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50 Years Of Political Polarization In One Chart

King County, Texas has seen the biggest shift in political preferences of all US counties since 1960 according to WaPo; but as io9's Mark Strauss notes reveal that during the last two decades, this is not unusual - an increasing number of Americans have chosen to veer Right or Left in their political orientation - with almost no center ground. That trend becomes especially apparent when looking at U.S. election results, county-by-county, since 1960.



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Salvador Dali - Central Banker?

Would Salvador Dali make a better Federal Reserve Chairman than Janet Yellen or Ben Bernanke before her?



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Jackson Hole: 'Tremendous' Downside Risks If Yellen Doesn't Go Full-Dovish

The consensus expectation is overwhelming that Fed Chair Yellen will deliver a dovish message at Jackson Hole. Macro investors have largely eliminated their short Treasury position and look to be long risk, particularly via equities and EM. FX positioning is long USD and long EM, the long USD largely because the euro zone economy is slipping again and the ECB is hinting at further ease. Our question is whether Yellen can be more dovish than what is now priced in, not whether she will be dovish on the Richter scale of dovishness. Full dovish, semi-dovish, or contingent dovish.



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US Attempted To Rescue James Foley, Other ISIS Hostages, Failed Because "Hostages Were Not Present"

If there was one thing the Obama administration did not need as it is careening from one international crisis to another, was compounding comparisons to the Carter administration and its botched attempt to rescue US hostages in 1980 Iran also known as Operation Eagle Claw. Well, as of moments ago, that comparison is now in play following what the Pentagon just revealed was a botched attempt to recue a number of American hostages held by ISIS, "early this summer." The reason why the mission failed: "tho hostages were not there." Why? "We don’t know. And that’s the truth. When we got there, they weren’t there. We don’t know why that is." At least we tried to rescue some folks.



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"Caught Between Iraq & A Hard Place"

Presented with no comment...



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Here's Who Profits From The Ferguson Riots

As Smedley Butler famously wrote "War is a racket," and despite those words being said 80 years ago, the last few weeks of violence in Ferguson have shown him correct as at least two firms have benefitted greatly. As Truthout reports, the majority of the munitions being used by police against protesters are made by Combined Systems or by the Defense Technology brand of the Safariland Group. The following map explores the owners and executives of these companies...



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Alternative Measures Suggest Weaker Economy

There is much hope pinned on continuing economic recovery in the United States despite a deterioration of the global economy virtually everywhere else. While it was not surprising to see a bounce back in activity after a contractionary first quarter, there are several economic data points that suggest that sustainability of the bounce is unlikely. Expectations are very likely well ahead of reality at the current time. This increases the risk of disappointment in the months and quarters ahead which could be a negative for the markets.



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Argentina Stuns Bondholders With Scorched-Earth "Cramdown" Plan

With the impasse over the latest Argentina default going nowhere fast, late last night president Kirchner stunned its creditors when she announced what amounts to a cramdown plan for holdouts, in which all bonds would be stripped of their existing indentures and converted to local law bonds. Or, as some would call it, a "scorched earth" transaction that burns all bridges, and goodwill, with the international creditor community and likely leaves Argentina unable to access global capital markets for the foreseeable future.



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Gold, Complacency, & Why Hookers And Bankers Share The Same Neighborhoods

Sometimes we are convinced it was completely by design, and not a weird little coincidence, that one of Germany’s most sprawling red light districts is just steps away from the European Central Bank. This fact becomes comically obvious right around happy hour... as self-congratulatory ECB economists and their bureaucratic bank underlings crowd the bars and cafes after work which are simultaneously frequented by pimps, thugs, and other assorted low-lifes. One would be forgiven for legitimately asking the question: which of these professions has done more damage to humanity? My [fiat] money’s on the bankers.



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Hawkish Fed Sends USD, Bond Yields Soaring; Stocks Dump & Pump

The last 2 days have seen the USD index rise at its fastest pace in almost 4 months, closing in on 1-year highs. Led by JPY and EUR weakness, the USD is up over 1% this week (which is set for the best week in 9 months). While stocks shrugged off the hawkish minutes initial kneejerk lower and surged towards new record highs, credit markets were not as exuberant about the great suck out of liquidity (and how they'll manage to roll the wall of debt forthcoming). VIX was slammed back to one-month lows (even as the Fed admitted greater uncertainty) slamming stocks higher. Treasury yields rose notably (with the short-end underperforming) as 2Y-5Y up 5-6bps, 10-30Y up 1-3bpsGold and silver drifted modestly lower and oil jerked higher. Copper was up from earlier on China restocking rumors. Into the close, stocks faded quickly - rather disappointingly ruining mainstream media's "new record high" headlines. Janet, save us....



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Goldman Post-Mortem: Minutes Have More Hawkish Tone

The July FOMC minutes generally had a slightly hawkish tone, warns Goldman's Jan Hatzius, emphasizing that labor market slack had improved faster than expected and that the labor market was now closer to what might be considered normal in the longer run. Overall, these remarks suggest that the change in the labor market language found in the July FOMC statement - shifting focus to broader labor market indicators rather than the unemployment rate specifically - was not intended to be a dovish change, as some commentators thought at the time. Finally, some participants noted some evidence of stretched valuations in specific markets.



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US To Sue Angelo Mozilo, Again

Nearly a decade after Countrywide was sold to Bank of America in what has become the worst M&A deal of all time, bar none, having resulted in tens of billions of legal charges for Bank of America shareholders, the most recent of which was revealed also minutes ago when Bank of America was said to reach a record $17 billion settlement with the government over the sale of mortgage-backed securities, moments ago Bloomberg announced that none other than Agent Orange himself, Angelo Mozilo, is about to be sued. Again, only this time the lawsuit may actually not be tossed or result in yet another DOJ trademark wristslap.



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The Market Reacts To The Fed's Minutes

The USD is soaring after somewhat hawkish Fed Minutes (up 1% this week) - pushing up towards critical resistance at 1-year highs. Treasury yields slammed 3-4bps higher and are holding those losses (30Y up 11bps this week). High yield credit is at the worst levels of the day as stocks retrace gains towards record highs. WTI crude jumped 1% on the minutes, back above $96 as gold slipped modestly back below $1290. Stocks, having kneejerked lower (below VWAP) have been ripped back higher by a VIX-slamming algo that decided that FOMC uncertainty is exactly the signal to buy certainty.



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Hilsenrath Warns Fed Rate-Hike Timing Debate Intensifying

The Wall Street Journal's Jon Hilsenrath unleashed an instantaneous reaction to today's FOMC minutes and the message is clear - markets are much less uncertain than the Fed about the timing (sooner rather than later) of the first rate-hike. The minutes of the meeting, Hilsy notes, provide fresh evidence of an intensifying debate inside the central bank about when to respond to a surprisingly swift descent in the unemployment rate and rising consumer prices. The minutes appeared to reflect a slightly more aggressive stance than Ms. Yellen's testimony.

 



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