Archive - May 16, 2015

The UN plans to launch a brand new plan for managing the entire globe at the Sustainable Development Summit that it will be hosting from September 25th to September 27th. For those wishing to expand the scope of "global governance," sustainable development is the perfect umbrella because just about all human activity affects the environment in some way. The phrase “for the good of the planet” can be used as an excuse to micromanage virtually every aspect of our lives.

Explaining all that is wrong with the fraudulent US "jobs recovery" using the case study of Japan.

One of the ways that the U.S. government most clearly expresses its deep dedication to global human rights, democracy and decency across the globe is via its unwavering support for the feudal, inhumane tyrannical monarchy of Saudi Arabia. In a punishment known as “crucifixion,” the executed person’s beheaded body is placed on public display for three days. Currently facing this fate are three political activists, including two children.

But, but, but... Q€...

There’s no question that the general level of stock investor sentiment is at historically high levels at this time. However, what has largely been absent, though, despite the elevated sentiment are examples of veritable investor euphoria. We did see traces of it over the past 2 years, especially in early 2013, but nothing consistent. Yesterday, however, we did see a possible example of this type of euphoria from the International Securities Exchange.

In recent months Goldman's chief equity strategist David Kostin has been getting increasingly "toppish" if not outright bearish on stocks. In his latest report he now openly warns that "the market will rise to 2150 by mid-year but fade after the Fed raises interest rates in September for the first time in nine years." As a result Goldman's "year-end forecast is 2100 and its 12-month target equals 2125." Which is where it closed on Friday. In other words, sell in May and come back until next May.

In a remarkable step up the cyber attack accusation ladder compared to last year's attempt to blame North Korea for cyber-sabotaging James Franco and Seth Rogen, the US now claims a sophisticated network of Chinese hackers has been stealing sesnsitive data from Penn State's engineering department for two years. Meanwhile, officials say China may be sending in "legions" of operatives disguised as graduate students to steal US military secrets.

It would be easy to scoff at these proposals as completely insane if the Fed hadn’t published a paper back in 1999 suggesting the implementation of a “carry tax” or taxing actual physical cash using an expiration date if depositors aren’t willing to spend the money.

"It’s not fair to the American people who work for a living that one day they can knock on the door, walk in their businesses, and say, ‘We just took your money’... I always thought your money was safe in the bank, but I wouldn’t say that now."

Neither would we!

Same laws, same gun, same street. What is the difference between these two Americans walking with an AR-15?

The Economist is a quintessential establishment publication. Keynesian shibboleths about “market failure” and the need to prevent it, as well as the alleged need for governments to provide “public goods” and to steer the economy in directions desired by the ruling elite with a variety of taxation and spending schemes as well as monetary interventionism, are dripping from its pages in generous dollops.  The magazine has one of the very best records as a contrary indicator whenever it comments on markets. While gold hasn’t yet made it to the front page, but the Economist has sacrificed some ink in order to declare it “dead” (or rather, “buried”).

Reading like his name-sake's horror novels, HSBC's Chief Economist Stephen King unleashes a torrent of truthiness about the Titanic-like economic ocean liner that is headed for an iceberg except this fragile ship doesn’t have lifeboats.

Saudi Oil Minister Ali al-Naimi may be one of the most powerful individuals in the global oil industry. But for all his power, is he the most ingenious? That question arises from the release of two reports on the current state of the oil industry that look at whether or not OPEC’s strategy of forcing US shale to cut back is succeeding.

The ECB warns Athens that Greece is rapidly approaching the "end game", as Tsipras sticks to 'red line' rhetoric. Meanwhile, FinMin Varoufakis claims the country will pay wages and pensions this month, but a leaked IMF memo indicates Greece will default on June 5 if it does not strike a deal with creditors by the end of the month.

Since the beginning of 2014, the 225 companies that have gone public in China have returned an average of 418% on their way to an average P/E of nearly 100X while growing earnings by an average of just 4%. Most absurd of all, software IPOs have returned 1,124%, have an average P/E of 311X on earnings growth of -5%.