Archive - Dec 2015 - Story

"The reaction of Erdogan and Turkish authorities can say one thing: they were stunned and shocked that Moscow has such evidence. This significantly affected the position of Turkey's NATO allies."

The dream and demand of Bernie Sanders and all of the other "democratic socialists" of all political parties is that all or at least significant parts of human life need to be micromanaged and controlled by government so people may be liberated from the "tyranny" of not having all they may want without finding effective ways of acquiring it through honest and peaceful work. The "freedom" about which Bernie Sanders speaks, and before him Franklin Roosevelt, in fact, involves a loss of liberty into an even greater degree of political paternalism.

Global equity markets, as measured by the MSCI Developed World index, are above the lows hit in early October but remain on a downtrend that began after markets peaked at the end of May this year. As SocGen's Andrew Lapthorne notes, the current level is now only just above where the index stood at the beginning of 2013 and less than 1% above the 2007 peak. In other words, as he warns, "the equity market has run out of momentum," and the 'bill' for the debt overhang is coming due.

Since taking office, Obama has boosted the number of people on the no fly list more than ten-fold, to an all-time high of 47,000 - surpassing the number of people barred from flying under George W. Bush. So should we be at all surprised that President Obama is using one egregious violation of Constitutional rights to target another?

The public-to-private sector "revolving door" has crossed into the macabre twilight zone.

Gold is an alternative to Fed “money.” If Fed money rises in value, gold deflates. Conversely, oil is a global GDP-commodity.  We believe the gold-to-oil ratio (GOR, gold/oz. divided by WTI oil/bbl.) is "deflation relative to reflation."

By excluding 294 "day of + day before" Fed meeting trading days (147 x 2 days excluded) out of over 4,500 total trading days since Jun-1997, the drop is ~50%. Basically, excluding just 6% of Fed-influenced days cuts the S&P 500 price in half.

"Invest for the long-term," "buy-and-hold," "stay diversified," are the mantra of every asset-gathering commission-taking 'manager' out there... However, as JPMorgan notes, empirically that is a loser's bet. In fact, investors owning just the top 10 performers of the S&P 500 has never suffered a single rolling 12 month period loss (lowest was April 2009 +0.24%).

“An unknown home-made explosive device has gone off at a public transport stop injuring three people"...

After September's record surge in total consumer credit, when non-revolving credit soared by $22 billion while credit card jumped by a whopping $6.7 billion, something appears to have snapped in October when according to the Fed, just $16 billion of new credit was created, almost half the prior month, and far below the consensus estimate of a $20 billion increase. And yet there is little risk that debt-fuelled spending on the two staples that have kept the US credit machine chugging along, namely student and car loans, both of which have just surpassed a total of $1 trillion in notional debt outstanding.

“A ban on assault weapons and large-capacity magazines might not prevent shootings in Highland Park (where they are already rare), but it may reduce the carnage if a mass shooting occurs. If a ban on semiautomatic guns and large-capacity magazines reduces the perceived risk from a mass shooting, and makes the public feel safer as a result, that’s a substantial benefit.”

Actions – including the state’s best-intentioned ones (giving them the benefit of the doubt) - have consequences, not all of them foreseen and some of them contrary to what was (we assume) intended.