Archive - Jul 4, 2013
Guest Post: A Surprising New Twist in the U.S. Natural Gas Market
Submitted by Tyler Durden on 07/04/2013 20:03 -0500
The U.S. natural gas market may be on the verge of a big swing. And it’s not about the talk of the town, Liquid Natural Gas (LNG). It's about an unexpected source of natural gas demand...
Which State Drinks The Most (And Least) Beer?
Submitted by Tyler Durden on 07/04/2013 18:55 -0500
On a day when the underlying reason for celebration in the US is often washed away by a few gallons of alcohol, we thought it timely to see just which states are the biggest soaks. It is likely no surprise that Utah is the driest state but the top 4 states seem head and shoulders above the rest with North Dakota topping the list at 45.8 gallons of beer per capita per year (or an average of just over 1 pint per day - which seems very reasonable?).
Clashes Between Foes, Supporters Of Mursi In Cairo Caught On Tape
Submitted by Tyler Durden on 07/04/2013 18:45 -0500
How the times change: two years ago, the victorious, resurgent, and US-supported, Muslim Brotherhood seemed unstoppable and was literally and metaphorically wiping out all obstacles in its way to the top, often times violently. Today, it is on the receiving end with the Egyptian military having somewhat curiously flipped its allegiance in a matter of days culminating with the overthrow of the "democratically elected" president Mursi in a largely bloodless coup over the past week. The video below from Al Arabiya shows how yesterday's winner can easily become today's recipient of mob scorn, not to mention punches. A far bigger question is just how will the "brotherhood" take its dramatic overthrow from power: quietly, with the occasional flaring of anger as the nation peacefully recovers from its second coup in two years, or with ever escalating protests that eventually morph into constant civil strife and/or all out civil war.
The Men That Broke Banks - Rogue Traders
Submitted by Pivotfarm on 07/04/2013 18:42 -0500An unprincipled, deceitful, unreliable scoundrel. A vicious and solitary animal. An organism that shows a variation from the standard. What are we talking about? Rogue Traders! Does the cap fit?
Say Hello to Inflation, Inflation is Dead
Submitted by ilene on 07/04/2013 18:03 -0500When enough of us realize the extent of inflation, bond buyers will likely demand higher coupon rates; the government's cost of debt service could soar.
The Next American Revolution
Submitted by Tyler Durden on 07/04/2013 17:30 -0500
The next American Revolution will not be an event, it will be a process. We naturally turn to the past for templates of the future, but history has a way of remaining remarkably unpredictable. Indeed, all the conventional long-range forecasts made in 1900, 1928, 1958, 1988 and 2000 missed virtually every key development--not just in the distant future, but just a few years out. The point is that extrapolating the present into the future fails to capture sea changes and developments that completely disrupt the supposedly unchanging, permanent Status Quo. The idea that the next revolution will take a new form does not occur to conventional forecasters, who readily assume the next transition will follow past critical junctures: armed insurrection against the central authority (The first American Revolution, 1781), civil war (1861) or global war (1941). We submit that the next American Revolution circa 2021-23 will not repeat or even echo these past transitions. What seems likely to me is the entire project of centralization that characterized the era 1941-2013 will slip into irrelevance as centralization increasingly yields diminishing returns.
China 'Officially' Moves From Made-Up Data To Hiding Data
Submitted by Tyler Durden on 07/04/2013 16:15 -0500
When the official Chinese PMI printed a few days ago we noted the 'odd' fact that several of the key sub-indices were 'missing'. While most put this down to some 'hiccup' or aberration, we wondered at the time what this might mean in a nation that has seemingly gone out of its way to baffle with Schrodinger bullshit for much of the last few 'recovery' years in the face of collapsing electricity production, copper/cement/steel prices, fake trade invoices, and a shadow-banking system so re-hypothecated that even the PBOC has decided enough is enough. Well, as Bloomberg reports, it turns out it wasn't an aberration, but new policy from China's Federation of Logistics and Purchasing which has now officially suspended the release of industry-specific data from the monthly survey of manufacturers. As one analyst put it, "the random absence of official data is disorienting," which is likely exactly the plan.
This $1.2Bn Crime Affects YOU!
Submitted by ilene on 07/04/2013 15:48 -0500Stolen from US consumers this week...
A Can't Lose Deal... "Public" Venture Capital
Submitted by Capitalist Exploits on 07/04/2013 15:45 -0500At 25% of GM's market cap, yet sporting just 0.6% of GM's sales, Tesla Motors is extremely overvalued.
Not Yours To Give
Submitted by Tyler Durden on 07/04/2013 15:20 -0500
"There are in that House many very wealthy men - men who think nothing of spending a week’s pay, or a dozen of them, for a dinner or a wine party when they have something to accomplish by it. Some of those same men made beautiful speeches upon the great debt of gratitude which the country owed the deceased — a debt which could not be paid by money — and the insignificance and worthlessness of money, particularly so insignificant a sum as $20,000 when weighed against the honor of the nation. Yet not one of them responded to my proposition. Money with them is nothing but trash when it is to come out of the people. But it is the one great thing for which most of them are striving, and many of them sacrifice honor, integrity, and justice to obtain it."
"So you see, Colonel, you have violated the Constitution in what I consider a vital point. It is a precedent fraught with danger to the country, for when Congress once begins to stretch its power beyond the limits of the Constitution, there is no limit to it, and no security for the people. I have no doubt you acted honestly, but that does not make it any better, except as far as you are personally concerned, and you see that I cannot vote for you."
- Col. David 'Davy' Crockett
4 Lessons From A Life On Wall Street
Submitted by Tyler Durden on 07/04/2013 14:14 -0500
In 20+ years of life on Wall Street, ConvergEx's Nick Colas has had four mentors who helped him make sense of the business. Some were very hands-on, and others taught more by example. In an intriguing note, Nick explains the four key lessons he learned from them. The single most useful lesson, especially for a brokerage analyst: “Message plus repetition equal franchise.” Other sayings that have stuck with Nick are “If you want and answer, you need to ask a question” and “do things the way you want to do them.” While simple to say, behind those simple aphorisms sit much richer messages.
Revolution: Corzine in Prison? And, Denninger on the Fed.
Submitted by EB on 07/04/2013 13:21 -0500Independence? Corzine's cooked and so is the Fed. But why did it take the CFTC two years to hunt down Corzine?
Guest Post: The New Praetorians And The New Cold War
Submitted by Tyler Durden on 07/04/2013 13:15 -0500
In a democracy rule is by consent. In a dictatorship it is by control. Which do we have in the West? It seems to me, it is no longer clear. We certainly still have the rituals of rule by consent. But behind the elected front men and women is a shadow state. It’s people ritually swear allegiance to those we elect. They declare themselves there to serve and protect. But when it is us they spend their time spying on, whose interests are they protecting? Can you really serve those you do not trust?
Kyle Bass Hunkers Down: "We Dramatically Reduce Portfolio Risk"
Submitted by Tyler Durden on 07/04/2013 12:14 -0500
"China’s direct contribution to global growth is enormous, but perhaps equally as important is its role in generating growth in developed and emerging economies. A slowdown, whether significant or extreme, in the Chinese economy heralds very bad news for asset prices around the world. A growth crisis centered in Asia will further exacerbate the instability and volatility in Japan and have a devastating impact on second derivative marketplaces such as Australia, Brazil and developing markets in South East Asia. The combination of rich valuations and further threats to growth has led us to dramatically reduce risk in the portfolio and actively position ourselves to withstand the uncertainty and instability ahead"
The Diminishing Effects Of QE Programs
Submitted by Tyler Durden on 07/04/2013 11:42 -0500
There has been much angst over Bernanke's recent comments regarding an "improving economic environment" and the need to begin reducing ("taper") the current monetary interventions in the future. What is interesting, however, is the mainstream analysis which continues to focus on one data point, to the next, to determine if the Fed is going to continue its interventions. Why is this so important? Because, as we have addressed in the past, the sole driver for the markets, and the majority of economic growth, has been derived solely from the Federal Reserve's programs. The reality is that such analysis is completely useless when considering the volatility that exists in the monthly data already but then compounding that issue with rather subjective "seasonal adjustments." The question, however, is whether such "QE" programs have actually sparked any type of substantive, organic, growth or simply inflated asset prices, and pulled forward future consumption, for a short term positive effect with negative long term consequences? The recent increases in interest rates, combined with still very weak wage growth, higher costs of living and still elevated unemployment is likely to keep the Fed engaged for the foreseeable future as any attempt to remove its "invisible hand" is likely to result in unexpected instability in the financial markets and economy.






