Archive - Aug 14, 2012
The War For The White House: The Definitive Explanation Of How Money Buys Politics
Submitted by Tyler Durden on 08/14/2012 20:20 -0500
In America, winning the Presidency has proven to be a question of how much money you're willing to spend. The trend constantly shows that, he who spends the most money on elections, usually wins.
Aaaand It's Gone: This Is Why You Always Demand Physical
Submitted by Tyler Durden on 08/14/2012 20:09 -0500
We have said it over and over, we'll say it again. For all those who for one reason or another would like to boycott the broken markets, yet trade gold in paper form, please understand that all the invested capital is at risk of total loss and can and will be lost, commingled and rehypothecated, not necessarily in that order, with little to zero recourse and the residual claim on liquidating assets pushed to the very end of the queue. Because if Lehman, MF Global, Peregrine, and countless other examples were not enough, here comes Amber Gold: a gold-based investment ponzi scheme out of Poland, in which it is likely needless to say that the gullible investors never had actual possession of the gold. And when they tried, it was gone. All gone.
German Bailout Rebellion: “We Have Euro-Anarchy”
Submitted by testosteronepit on 08/14/2012 20:01 -0500In 2005, the French and Dutch “unexpectedly” voted for sovereignty, and killed the EU constitution. Germans might vote next.
Guest Post: What Does Liberty Really Mean?
Submitted by Tyler Durden on 08/14/2012 19:23 -0500"Personally, I look at the Americans and I see a people who have been very effectively brainwashed, or who simply have given in to the entirely human tendency to shuffle unquestioningly onto the path of least resistance and let themselves go. I see a people who, on a wholesale basis, have consciously or unconsciously decided to trade the idea of America for the false security of a totalitarian state."
David Galland
And the hard reality is that the vast majority would raise their hands in favor of the current system that has the state deeply involved in pretty much every aspect of the economy and society at large. The level of support for the very same tangled body of state-controlled handouts, regulations and central economic planning now choking the last gasps of life out of the body politic is obvious and overwhelming. The champions of liberty are fighting against a very entrenched and increasingly dangerous public mindset. Today the enemy (of true freedom) is within. In fact, the nation is overrun by them... they dominate in most every community, in most businesses and even in most families.
It's Not Enough To Be 'Well-Off' Anymore
Submitted by Tyler Durden on 08/14/2012 18:32 -0500
Since 1990, across the four 'major' emerging markets and the advanced economies, UBS estimates a point estimate of a 29% increase in the number of “well-off” households in these economies. This sounds like a new age of affluence. But before we get carried away by the rise of what might be termed the upper middle class, economist Paul Donovan notes that the number of well off households having increasing 29% from 1990 to 2010 needs to be compared against a rise in the global population of 30% over the same period. In other words, the number of “well-off” households has risen broadly in line with demographics. This then begs the question – why has income inequality increased, if the number of "well-off" households is rising proportionate to the increase in overall population? The answer, quite simply, is that in relative terms, the “well-off” are not as “well-off” as they used to be.
Complete Q2 Hedge Fund Holdings Summary
Submitted by Tyler Durden on 08/14/2012 18:16 -0500Q2 hedge fund reporting season has come and gone. Below is a summary of the key funds, and who held what at the end of June.
Ryan Versus Obama; Budget Plans Mean Fiscal Tightening Either Way
Submitted by Tyler Durden on 08/14/2012 17:51 -0500
Republican Presidential candidate Mitt Romney's selection of Rep. Paul Ryan (R-WI) as his running mate has generated renewed interest in the House-passed budget resolution that Ryan authored. Ryan's budget outline would reduce the deficit more quickly and impose more fiscal restraint than the President's budget proposal. However, as Goldman notes. while both proposals would increase revenues due to the scheduled expiration of the payroll tax cut at year end, the President's would raise income taxes as well. Rep. Ryan's plan, on the other hand, would cut spending sharply in 2013 and 2014, even though it assumes a one-year delay in the spending cuts under the "sequester" set to take effect at year-end. If the President wins reelection and/or Democrats hold their majority in the Senate, a bipartisan compromise would be necessary to enact fiscal reforms. This has been difficult to achieve over the last year or so and we expect compromise to be even tougher. We continue to believe that the economic effects of allowing the fiscal cliff to take effect in full will be the greatest motivation for members of Congress to reach an agreement.
This Is America's Sugar Addiction - An Infographic
Submitted by Tyler Durden on 08/14/2012 17:05 -0500
Want to solve the unresolvable issue of America's $100 trillion in unfunded welfare liabilities? Start with this: America's sugar addiction, because in 1822 America, the average person consumed 45 grams of refined sugar, or the amount found in one 12-ounce soda can, every 5 days; fast forward to 2012 and in the same period the average American now consumer a whopping 765 grams of sugar - the equivalent of 17 (non-diet) soda cans; also the equivalent of 130 pounds of refined sugar every year! More than anything, this country's fascination with the sugar high (as well as all other various forms of cheap fast food gratification) coupled with an increasingly sedentary "behind a computer" lifestyle is the leading contributor to obesity, chronic healthcare conditions, and numerous other known and unknown sources of emergency healthcare funds. As always: if one wants change, that change always has to start in the mirror.
Guest Post: Obama’s War On Whistleblowers Accelerates: Science Itself is Now Contraband
Submitted by Tyler Durden on 08/14/2012 16:54 -0500The Obama administration is evil. Sorry, there is no other adjective to describe it at this point. They know they are corrupt, they embrace their corruption and now they are doing everything possible to silence anyone who dares call them out on it. The latest case of Obama’s war on whistleblowers relates to how the Scientific Integrity Officer within the Interior Department, Dr. Paul Houser, was attacked when he started raising some scientific and environmental questions.
Full Breakdown Of David Einhorn Q2 Long Equity Holdings
Submitted by Tyler Durden on 08/14/2012 16:36 -0500Unlike Dan Loeb, David Einhorn did a far more calculated portfolio reshuffle in the three months of Q2, purging only 6 positions among which RIM, CA, Dell, HCA, the GDXJ Junior Gold Miners ETF, and Roundys. He appears to have also hired a new healthcare/insurance analyst after adding positions in Cigna, Coventry Health, UnitedHealth, Humana, Wellpoint, as well as Einstein Noah Restaurants, Virgin Media, Hess, Chipotle, Genworth and some Oaktree bonds. His top 5 positions are Apple, Seagate, Microsoft, Marvell Tech and Cigna. Overall, it does not appear as if he has had a major shift in perspective on the economy. Total reported long equity AUM as of June 30 was $6.4 billion.
Dan Loeb Purges Portfolio, Cuts Over Two Thirds Of Equity Holdings, Adds 25 New Positions
Submitted by Tyler Durden on 08/14/2012 15:59 -0500In Q2 Dan Loeb went to town to his holdings as of March 31. Of his roughly 38 different positions, Loeb cut 24 names to zero among which Cisco, Marvell Technology, Sara Lee, Google, Wells Fargo (with the Octogenarian of Omaha likely buying every share), El Paso, Abercrobmie, Goldman and many others. Of course, he kept his stake in Yahoo and added to Apple, while cutting his Delphi stake from 13.34 million shares to 11.5 million. He used the proceeds from these sales to add to new positions (latest 13F here) in new names such aws AIG, Aetna, Chesapeake, Cigna, Coca Cola, Enphase, Humana, News Corp, and Unitedhealth Group. Also, Loeb went quite optically against Bill Ackman and bought a $6.5 million share equivalent put in JCPenney. He is significantly in the money in this. Altogether, his disclosed equity stake was at $3.3 billion as of June 30, down from $4.1 billion at March 31. Dry powder? Or more likely getting more into bonds (which he doesn't have to disclose on any filing).
S&P 500 Futures 'Plunge' 1.25 Points - Most In 10 Days!
Submitted by Tyler Durden on 08/14/2012 15:19 -0500
Don't panic. Change is good. The S&P 500 futures market somehow dropped 1.25 points today - its worst in 10 days! - and yet, shock horror, data was positive, European leaders offered more jawboning support, and Treasuries weakened. NYSE volume remained bleak but S&P 500 e-mini futures (ES) volume rose to its highest in over a week (yes - we were stunned too - volume picked up as selling began) amid reasonable average trade size (especially as ES lost 1400). After VIX's implosion yesterday, it ramped over 1.25 vols higher today - testing back to 15% late on. The USD leaked higher all day, back to unchanged on the week (while Copper/Gold/Silver are all down 1.2-1.3% on the week - having gapped down on positive data this morning). Oil remains green on the week and spurted modestly higher on the day. Treasuries are still under pressure - not getting much back as equities sold off into the close - higher/steeper in yield by 4-8bps on the week now. Of course - the closing rampfest was inevitable as that stunning 4 point drop in ES was rapidly 'tickled' back up to near VWAP into the day-session close - though we note that ES was unable to get green and unable to reach the safety of VWAP with heavy 'down' volume after-hours. Cue 'Asian-opening-gap-worm' algo.
Is Investment Grade Issuance Driving Treasury Weakness (Again)?
Submitted by Tyler Durden on 08/14/2012 14:45 -0500
Back in March, the last time we saw a notable and relatively sustained rise in Treasury yields, we pointed out a potential driver for this 'apparent' weakness - the heaviness of investment grade corporate bond issuance. This drives relative selling pressure in Treasuries for three potential reasons: pre-emptive rate locks are positioned; managers hedge away interest-rate duration to lock in the 'spread' on the bonds as they are jig-sawed into existing portfolios; and most simply speculative rotation from Treasury bond 'cash' into new issues (thus avoiding the convexity issues associated with such low yields on existing 'secondary' bonds). As the charts below show, in March, as we noted at the time, issuance expectations (the forward calendar) were falling and we suggested Treasury yields would drop as this implicit selling pressure would also lift. While this time Gross and Singer have spurred some risk-aversion, no doubt, the IG calendar suggests a lifting of the selling pressure soon here too.
Fisker Lights Fire Under CEO Post, Hires Former Chevy Volt Head
Submitted by Tyler Durden on 08/14/2012 14:37 -0500
Fisker, whose Karma superburningcar made headlines two days ago for being the latest addition to America's New Spontaneously Combusting Green Normal, has decided to double down on that elusive spark, and has released the incendiary news that it has hired as CEO none other than head of that other hot selling eco-car, the Chevy Volt. From Reuters: "Fisker Automotive named the former head of General Motors Co's (GM.N) Chevrolet Volt program as chief executive on Tuesday, marking the second time the troubled, government-funded start-up has replaced its top executive this year. Tony Posawatz, who oversaw the development of the Chevy Volt plug-in hybrid for six years before he left GM this summer, will replace outgoing CEO Tom LaSorda. "I've been recruiting him for quite a while and certainly had some people assist me in giving him the full story," LaSorda said during a conference call with reporters. "He's come in with eyes wide open."" Hopefully he's also come in with a fire extinguisher.




