Archive - 2012 - Story
December 29th
French Constitutional Court Strikes Down 75% Millionaire Tax, Finds It "Unfair"
Submitted by Tyler Durden on 12/29/2012 11:18 -0500
In a crushing blow to socialism, wealth redistribution and purveyors of the "fairness doctrine" (as defined here first) everywhere, the French Constitutional Council ruled on Saturday that Hollande's brilliant idea to tax millionaires at a 75% tax rate - a move which has since seen numerous millionaires leave France and move to Belgium - is unconstitutional. Per Reuters, the Council ruled that the planned 75 percent tax on annual income above 1 million euros ($1.32 million) - a flagship measure of Hollande's election campaign - was unfair in the way it would be applied to different households. Which is ironic because just like in the US, so in France, the selective wealth redistribution campaign waged by the government against the "rich" (which have yet to be properly defined: those making over $250K? Over $400K? Over €1MM?) was based on the premise that it is only "fair" that the rich contribute more. Turns out fairness in the eye of the government beholder, was unfair. But the move begs the question: would the court have struck down the law had it been a merely 50% tax hike? And if the income cut off was, say, €500,000? The far bigger question is, and has been in this year of encroaching socialism, just what is the definition of "rich", what is the definition of "fair redistribution", and where do the two coincide. Finally, how soon until the US Supreme Court weighs in as well on any final Fiscal Cliff tax hike proposal which, like in France, will see the "rich" pay an abnormal share, and will that too be ruled unconstitutional?
Postponed
Submitted by Tyler Durden on 12/29/2012 10:30 -0500“Postponed” is the official stamp across the world. This is the operative word of governmental policy. Whether Europe or America, whether capitalist or socialist government; this is the credo, the banner, the flag waving in the wind for dealing with economic problems. Throw more money at it and barrels of it, have the central banks print and defer any pain much less any tough decisions. We live in a state of postponement, defer and delay which cancels the consequences of the moment but places more severe consequences, greater pain and tougher choices but moments out into our future. Make no mistake; the world has become a more dangerous place either haunted by the specter of rampant inflation or haunted by valuations of debt and currencies that could turn the financial markets into a swirl of dislocation where a plunge into a freezing sea of disarray awaits as capital goes to gold, senior debt regardless of yields and nations deemed to be safe havens.
December 28th
2012 - 'Year Of Living Dangerously' In Review
Submitted by Tyler Durden on 12/28/2012 19:49 -0500- Afghanistan
- Apple
- Barack Obama
- Ben Bernanke
- Ben Bernanke
- BLS
- China
- Corruption
- default
- European Union
- Foreclosures
- Germany
- High Frequency Trading
- High Frequency Trading
- Iran
- Iraq
- Israel
- Japan
- JC Penney
- Jim Cramer
- keynesianism
- Middle East
- Mortgage Loans
- National Debt
- Quantitative Easing
- Real Unemployment Rate
- Reality
- Recession
- Ron Paul
- Sears
- Short-Term Gains
- Sovereign Debt
- Unemployment
- Washington D.C.
Despite the fact that myself and everyone else acting like they know what lays ahead are proven wrong time and time again, we continue to make predictions about the future. It makes us feel like we have some control, when we don’t. The world is too complex, too big, too corrupt, too lost in theories and delusions, and too dependent upon too many leaders with too few brains to be able to predict what will happen next. This is the time of year when all the “experts” will be making their 2013 predictions - but few will address where they were wrong in previous predictions. I’m more interested in why I was wrong. It seems I always underestimate the ability of sociopathic central bankers and their willingness to destroy the lives of hundreds of millions to benefit their oligarch masters. I always underestimate the rampant corruption that permeates Washington DC and the executive suites in mega-corporations across the land. And I always overestimate the intelligence, civic mindedness, and ability to understand math of the ignorant masses that pass for citizens in this country. It seems that issuing trillions of new debt to pay off trillions of bad debt, government sanctioned accounting fraud, mainstream media propaganda, government data manipulation and a populace blinded by mass delusion can stave off the inevitable consequences of an unsustainable economic system. Will 2013 be the year it all collapses in a flaming heap of rubble? I don’t know. Maybe you should ask an “expert”.
This Is What America Really Thinks
Submitted by Tyler Durden on 12/28/2012 18:52 -0500
Presented with no comment.
16 Things About 2013 That Are Really Going To Stink
Submitted by Tyler Durden on 12/28/2012 18:11 -0500
The beginning of the year has traditionally been a time of optimism when we all look forward to the exciting things that are going to happen over the next 12 months. Unfortunately, there are a whole bunch of things about 2013 that we already know are going to stink. Taxes are going to go up, good paying jobs will continue to leave the country, small businesses will continue to be destroyed, the number of Americans living in poverty will continue to soar, our infrastructure will continue to decay, global food supplies will likely continue to dwindle and the U.S. national debt will continue to explode. Our politicians continue to pursue the same policies that got us into this mess, and yet they continue to expect things to magically turn around. But that is not the way that things work in the real world. Bad decisions lead to bad outcomes. Sticking our heads in the sand and pretending that everything will be “okay” somehow is not going to help anyone.
Obama To Assign Fault; Propose Plan D, Different From Last Friday's Plan C - Live Webcast
Submitted by Tyler Durden on 12/28/2012 17:31 -0500
We would expect the ingredients of the speech to be a pinch of self-denigration mixed with 6 fluid ounces of 'millionaires-and-billionaires', and a quart of "it's the other guys' fault." This coming from the man who precisely a week ago announced he would propose a "scaled down" plan, which today turned out was a complete lie: some leadership. Nevertheless. it will be interesting to see how his 'new' plan, same as the 'old' plan, is different from the 'new new' plan-to-come as he pushes the Senate to propose a 'new new new' deal that will really be a 'skinny irrelevant' deal - no doubt heralded by all asunder as a 'grand new' deal. Though it appears we should have no fear as McConnell and Reid are working on it and McConnell is "hopeful and optimistic." Farce!
CME Lowers Gold Margin By 9%
Submitted by Tyler Durden on 12/28/2012 17:07 -0500Adding to the confusion, for some, that is today's trading session, here comes the CME which in a post-closing announcement, proceeds to hike outright margins on a variety of petroleum and freight products, but more importantly just cut the margins on gold by 9%. Is it that time when the establishment is clearing the path for everyone to rotate out of equities (and/or bonds) into gold, just to set the trap and pull the trapdoor once everyone is once again left holding paper gold? We shall see, but following tonight's selloff, gold is now less than 5% less than stocks YTD. It may well be up to the last trading session of the year to determine who wins in 2012: rock or paper.
VIX Snaps To Six-Month Highs On Longest Stocks Slump Since May
Submitted by Tyler Durden on 12/28/2012 16:09 -0500
For the first time since May, the S&P 500 has fallen for 5 days in a row. VIX has very much heralded the fact that investors were not as bullish as media-types would like to believe - as we have vociferously noted - and today's jump in the VIX pushes it to six-month highs over 22.5%. The S&P 500 futures ended the day-session at the week's lows testing down just shy of last week's flash-crash lows. Meanwhile, while equities slumped catching down to Treasury yields, commodities were relatively flat as was the USD; it seems that the excess longs in equities relative to the rest are unwinding - a different picture than what was seen during last Summer's debt ceiling debate.
Obama: "My Offer Is Nothing" - Stocks Plunge
Submitted by Tyler Durden on 12/28/2012 15:40 -0500
Looks like today everyone in Congress was short. Here's why:
OBAMA SAID NOT TO MAKE NEW OFFER IN FISCAL CLIFF TALKS
OBAMA OFFER DETAILED BY SOURCE FAMILIAR WITH WHITE HOUSE MTG
OBAMA SAID REITERATING PROPOSAL FROM LAST WEEK ON FISCAL CLIFF
So much for a deal, and so much for the invisible DJIA support at 13,000.
End-Of-Week Algo-gasm Insanity Imminent?
Submitted by Tyler Durden on 12/28/2012 15:25 -0500
UPDATE: S&P says an impasse will not prompt an immediate downgrade - ramp-on (perfectly to VWAP and faded)
The Dow just breached 13,000 to the downside and S&P 500 futures are bleeding lower (catching down to a more anxious credit and Treasury market). Now well below VWAP, we worry that the plethora of headlines about to be unleashed on the investing world will create chaos in the markets (most likely futures first given liquidity). AAPL used the rampathon to get to Boxing Day's closing VWAP for a heavy dump. Will the meeting (which started at 1510ET) end after the day-session close allowing futures traders to play? who knows...
How Algos Orchestrate "Momentum Ignition" Chaos
Submitted by Tyler Durden on 12/28/2012 15:11 -0500
On December 26, 2012 at 11:02:59, the market suddenly exploded with activity (SPY dropped below 141.88 - a low set 12 days earlier on December 14). Approximately 3,800 March 2013 eMini futures contracts (S$P 500) were sold during that second. Nanex thought the sudden explosion in activity warranted a closer look. What they found was fascinating. It appears the entire market-wide move may have been carefully orchestrated. One thing for certain is that our regulators will never be able to see the big picture if their analysis tools (MIDAS) only looks at equity data. Analyzing price moves in futures and options is crucial to understanding market-wide moves in equities, and visa versa. The sad truth is that 'momentum ignition' events such as this occur all the time. See this page more details, including an animation that shows where and when these events have occurred since 2007.
Friday Humor: Top Ten Reasons Why Fiat Currency Is Superior To Gold
Submitted by Tyler Durden on 12/28/2012 14:43 -0500- Bank Failures
- Bank of England
- Bulgaria
- Central Banks
- China
- ETC
- Federal Reserve
- France
- Germany
- Global Economy
- Gold Bugs
- Goldilocks
- Great Depression
- Greece
- Hungary
- Hyperinflation
- Japan
- Keynesian economics
- Krugman
- Milton Friedman
- Money Supply
- Napoleon
- Paul Krugman
- Post Office
- Precious Metals
- Purchasing Power
- Quantitative Easing
- Roman Empire
- Unemployment
- Warren Buffett
- Yen

In the spirit of the holidays and hope for a more prosperous 2013, we thought readers might appreciate a little humor to partially offset the relentless 'cliff' doom and gloom. So please, don’t take this too seriously. But if you happen to stumble across a ‘paperbug’ or two over the holidays, perhaps you could share some of the points made here. Humor sometimes helps people realize just how hopelessly misguided they are... Quantitative easing changes nothing. Remember, the PhDs are in charge of our economies and they know exactly how much our money should be worth. Those of us concerned that our money might lose purchasing power are just being paranoid. Choice is dangerous. Think Adam and Eve and you’ll get my point. Those arguing in favour of monetary freedom, of choice in money, of repealing legal tender laws, they’re just like that nasty snake Lillith in the Garden of Eden, the source of all trouble I tell you. ‘Tis the season to borrow and spend folks, as indeed it has been since 1971.
Iran Launches "Massive" 6 Day Naval Wargame - Video Coverage
Submitted by Tyler Durden on 12/28/2012 14:16 -0500
As we reported previously, today Iran decided to launch a rather impromptu "massive" naval drill dubbed the Velayat 91, which will take place in the Oman Sea, North of Indian Ocean, in the Persian Gulf and East of Strait of Hormuz, and will cover an area of one million square kilometers right in the sweet zone of the US 5th Naval Fleet's AOR, where in addition to other resources, both the Stennis aircraft carrier and Peleliu amphibious warfare ship group are located. As PressTV reports, "On the first day of the drills, ships and submarines, will go to their locations and get ready for the tactical stage of the maneuvers. Forces in shores will also get ready for the tactical phase of the drills. In addition our 23rd fleet will be deployed to the high seas to protect commercial ships and oil tankers and to counter piracy in Gulf of Aden." All this will be taking place within kilometers of both the busiest seaborne transit corridor of crude oil in the world, as well as the headquarters of the US 5th Navy in Bahrain. What could go wrong.
Bob Shiller On The 'Housing Recovery': "Highly Uncertain, It's Risky"
Submitted by Tyler Durden on 12/28/2012 13:37 -0500
Sometimes, taking a break from the mainstream view of the world is healthy for our sheep-like tendencies to follow the herd. To wit, Robert Shiller can't understand the enthusiasm for the long-term recovery outlook of the housing market. With rentals rising and home-ownership dwindling, Shiller, in this Bloomberg TV clip, questions the positivity noting that the outlook is 'fuzzy' at best; and in fact in the short-term is negative as MoM things have deteriorated modestly (though seasonally). He note that the focus has been on multi-family residences and "if you are sitting in a suburban single-family house - what is your outlook? Highly uncertain - It's Risky!" And in one of the most prescient comments of recent weeks, Shiller admits something that many others should try: "[the outlook] could be up; but I don't see how anyone knows?" adding that another plausible outlook for the next five years is that "housing stays right where it is now," adding that Zillow's 1.3% annual real growth expectation could be too optimistic.




