August 21st, 2014
Presented with no comment...
Police in the Liberian capital fired live rounds and tear gas on Wednesday to disperse a stone-throwing crowd trying to break an Ebola quarantine imposed on their neighbourhood. As Reuters reports, at least four people were injured in clashes with security forces, witnesses said, though it was unclear whether anyone was wounded by the gunfire. Liberian authorities introduced a nationwide curfew on Tuesday and put the West Point neighbourhood under quarantine to curb the spread of the disease. "The soldiers are using live rounds," said army spokesman Dessaline Allison, adding: "The soldiers applied the rules of engagement. They did not fire on peaceful citizens." Locals are angry, "I don't have any food and we're scared," screamed one, adding, "it is inhumane."
Nowhere is the "financialization" of the US economy more evident than in this chart showing the relative net worth ratio of quntile to the next quintile right below it. Quote Census: "The distribution of net worth became more spread out between 2000 and 2011. The ratio of median net worth of the highest quintile to the second quintile increased from 39.8 to 86.8 between 2000 and 2011, and the ratio of the highest quintile to the third quintile increased from 7.7 to 9.2. The ratio of the highest quintile to the fourth quintile was 3.0 in 2000 and showed no statistically significant change over this period."
Forget Bloomberg, ignore Reuters, dismiss that 'well-informed trader' source... Ukraine's Central Bank has decided that critical medium for expressing its desperation to stop the collapse of its currency is... Facebook.
Meet the new Boogeyman, the same as the old Boogeyman...
It appears that while most of the world's great unwashed sell-side Economists were not invited to J-Hole this year, this group of protesters managed to sneak in and had a message for QE-ing elite...
The current occupation of the markets is both "unbelievable in power and grandeur." There is simply no denying the current bull market trend as "silent crowds remain stupefied by its immensity, its endlessness and its splendid perfection." The thought for the day is simply this: "Like the many proud soldiers that occupied Brussels then, two or three years from now, how many investors will be alive to 'tell the tale' of the occupation of the bull market today?" It is within "resigned complacency" that the risks to portfolios are easily dismissed with the conviction of strength and control. Yet, it is also within this illusion that the greatest defeats in history have been delivered.
Despite the constant hum of talking heads explaining how investors are "hating this rally" just ready to pile their last penny into stocks any minute (as soon as rates rise and destroy bondholders), AAII sees bullishness at 2014 highs... it appears retail is very much all-in and praying for Yellen's blessing tomorrow...
If QE is ending because it was so successful, then why is aggressive forward guidance necessary? If QE worked so well, then why will Yellen likely need to mention ‘the elevated number of part time workers’, ‘under-utilization of labor resources’ or ‘room for improvement in the labor market’? In regard to its inflation mandate, there is no evidence that QE has had any impact other than causing asset price inflation.
For almost a hundred years a group of movers and shakers of the diamond mining world dominated the market and pulled off arguably THE most successful marketing campaign in corporate history
Rumors are rife that Burton Malkiel is preparing a sequel to his previous blockbuster that will be titled "A Random Straight Line On Wall Street." Because, simply put, random walks are so pre-central-planning...
Anytime there are negative or even close to negative real rates for bonds that is a sign that central banks need to change policy.
Following Russia's closure on several McDonalds in Moscow, the CEO of the American Chamber of Commerce is worried: "The question on my mind is: Is this going to be a knock on the door, or is this going to be the beginning of a campaign?" As Reuters reports, businessmen from both West and East are increasingly frustrated with the tit-for-tat sanctions (and their apparent lack of efficacy at anything but slowing global growth). Russian and Ukrainian CEOs joined Richard Branson to write "We, as business leaders from Russia, Ukraine and the rest of the world, urge our governments to work together to ensure we do not regress into the Cold War misery of the past." As we noted previously, Europe has suffered most, and the following European companies remain the most exposed to escalation.
The Fed likes to claim that its policies are aimed at helping Main Street. Ben Bernanke began this argument when he was still Fed Chairman. Janet Yellen has since taken it a step further claiming that she comes from an “intellectual tradition” that it is important to use “public policy” to “make the world a better place.”
In addition to the countless other reason already presented here over the past year why the bond market simply refuses to sell (scarcity of "high quality collateral", shadow banking lubrication, fears over a slowing economy, reverse rotation by pension funds from stocks into bonds, etc), here is one more reason: today the spread between the 30 Year Bund and the 30 Year Treasury just hit a record wide.