Archive - Mar 14, 2015 - Story

In the first part of this article series, we discussed the true state of global demand, along with the unstable situation within numerous indicators from exports to retail. Swiftly falling global demand for raw materials as well as consumer goods is an undeniable reality. This is a distinct problem in terms of the U.S., which has been, up until recently, the primary consumption driver for much of the world. As we will show, U.S. demand is about to fall even further into the abyss as real unemployment and personal debt take their toll.

In the discourse of statists, there is a group of phrases of which one or more tend to be present in nearly every argument. While this is not an exhaustive listing of that group, it does contain twenty-five of the most common phrases that statists use in their arguments. As propaganda has a tendency to be repetitive, some of these phrases contain the same logical fallacies, and will therefore have similar refutations...

The bust of Aussie boom-towns, collapse of the mining industry, dramatic capital outflows, and a bursting housing bubble all have one thing in common, according to billionaire hedge fund manager Crispin Odey - "China is everything to Australia in lots of ways." Simply put, he tells The Australian Financial Review, economies dependent on China for income, including Australia, are headed for recession and central banks will not be able to able to come to the rescue because they have exhausted the arsenal of policy weapons. "We've got a very old-fashioned recession which is spreading across the world," and Australian banks face a tough time ahead too because there are indications bad debt risks are rising.

US sales of what the industry calls "luxury" rolls — anything quilted, lotioned, perfumed or ultra-soft, from two- to four-ply — climbed to $1.4 billion last year, outpacing all other kinds of toilet paper for the first time in nearly a decade, data from market research firm Euromonitor International show. The luxury market is one-fourth the size of the standard TP market, but its prominence in Big Wipe is growing faster than many industry watchers expected. Luxury toilet paper sales have grown more than 70 percent since 2000, and they're expected to keep growing faster than all other categories every year through at least 2018.

Keep your friends close...

Nearly 100 years after its creation, the power of the U.S. Federal Reserve has never been greater. Markets and governments around the world hold their breath in anticipation of the Fed Chair's every word. Yet the average person knows very little about the most powerful - and least understood - financial institution on earth. "Money For Nothing" is the first film to take viewers inside the Fed and reveal the impact of Fed policies - past, present, and future - on our lives. Join current and former Fed officials as they debate the critics, and each other, about the decisions that helped lead the global financial system to the brink of collapse in 2008. And why we might be headed there again...

On the scale of 'unpatriotic' things to suggest, there is only one thing worse than a tax inversion for an American to do... suggest something positive about Russia, Russian markets, or Russia's economy. So it perhaps ultimately ironic that none other than Goldman "doing God's work" Sachs suggests Russian bonds are both cyclically and strucuturally under-priced.

According to The New York Times, some $1 million in money the CIA delivered to the Afghan government was handed over to Al Qaeda in 2010. As The Times notes, this is merely the latest "in a long list of examples of how the United States, largely because of poor oversight and loose financial controls, has sometimes inadvertently financed the very militants it is fighting." 

Rich valuations point to the likelihood of low returns across asset classes. [W]e develop a cross-asset approach to risk premia and implement it across the asset classes. The results show that valuations are rich across the board. This indicates markets may become shaky as we get closer to the first Fed rate hike in nine years.

This anti-capitalistic mentality has brought about today’s essentially bankrupt “middle of the road” welfare state system, in which governments and big business are in a tight embrace that utterly deadens economic progress. The EU’s latest “Four Year Plan” is yet another in a long list of examples of this prototypical continental tradition (incidentally, Europe’s moribund banking system is one of the end results of these economic policies as well). What is really required is a return to free market principles, not yet another “government plan”.

Someone call the ECB because it looks like the game is well nigh up. Greek FinMins are taking time away from photo shoots and looting pension funds to call out QE for creating equity bubbles and the mainstream financial news media has figured out that there’s an acute collateral shortage and that buying €1.1 trillion in bonds €15 million at a time probably indicates a forced deviation from the original plan.

The Washington Post notes that "many Western countries are cutting their defense budgets, while military spending in Russia and China surges," leading some US and UK officials to question whether the West is prepared to counter the "greatest threats to global security." 

To truly understand monetary policy, we go to the source...  Sounding supremely self-righteous, the New York Fed concludes, "making monetary policy is a complicated job but it's necessary in order for our economy to enjoy continued growth along with stable prices." And besides, if you lot are allowed to think for yourselves, who knows what could happen?

The relative lack of political and internet freedom in China is well known, as is the egregious treatment of the Tibetan people. Despite having controlled Tibet since 1949, and the subsequent intentional migration of ethnic Han Chinese into the region in order to dilute the culture, Chinese authorities remain paranoid and filled with fear. So much so that the government is panicking at recent statements by the Dalai Lama that he may not be reincarnated. This screws up the government’s plan to name the next Dalai Lama and use him as a puppet stooge for the regime. Truly embarrassing.