Archive - May 2015 - Story

The US is applying political pressure to Greece in an effort to dissuade Athens from participating in Russia's Turkish Stream Pipeline project which has been implicitly used, at various times, as a negotiating tactic in discussions with EU creditors. As the Times suggests, this is further evidence that Washington is becoming increasingly concerned that the world is rapidly shifting away from the US-dominated, unipolar model that has existed, in one form or another, since the collapse of the Soviet Union. This consternation is beginning to manifest itself in the revitalization of Cold War politics.

The system can certainly be given some sort of name, but a functioning democracy it’s not. If anything, a democracy is “A system of government in which power is vested in the people”. Makes us wonder how many clients of the 421 foodbanks and counting have voted Conservative and figured they were proudly doing their democratic duty.

The trends in both Japanese income and spending moved downward not at the inception of the tax increase but at the very start of QQE itself. Science is the study of observation whereas monetary economics has become the science of avoiding them. If economists want to see recovery in that they should be honest about so redefining the term. BoJ is two years into QQE and the hole that has been dug for the Japanese people is enormous, so it will be extremely difficult at this point just to get back to even without ever accounting for lost opportunity for compounding and time. Maybe that doesn’t count as the typical, natural recession but it is nothing short of a man-made disaster.

Only 56% of Americans said they were "very proud" of their nation, according to World Values Survey data, down from over 62% in 2009 (71.1% in 2004, and 77% in 1999). Behind nations such as Libya, Nigeria, Egypt, and Poland, 'exceptional' America now ranks only 30th in the world for national pride...

In the coming months, however many hours Clinton spends introducing herself to voters in small-town America, she will spend hundreds more raising money in four-star hotels and multimillion-dollar homes around the nation. The question is: "Can Clinton claim to stand for 'everyday Americans,' while hauling in huge sums of cash from the very wealthiest of us?" This much cannot be disputed: Clinton's connections to the financiers and bankers of this country - and this country's campaigns - run deep. As Nomi Prins questions, who counts more to such a candidate, the person you met over that chicken burrito bowl or the Citigroup partner you met over crudités and caviar?

"It is clear that the correction in external trade cannot be easily explained by the CNY distortion factor. The exports would be more struggling from the soft demands from the major trade partners and deteriorating international competitiveness in the low end manufacturing sector."

America’s uniquely irrational behavior among civilized nations, whether or not a product of our diverse multi-racial society, has not served the country well during the past two decades adding the social problems created by racial inequality to an ever-widening economic inequality among Americans that Ronald Reagan legated to us. And as social inequality merges with economic inequality, a synergy of resentful rage is being created in cities and communities largely populated by people of color. Enter the city of Baltimore with a two-thirds black population, America’s problem-du-jour.

The graduating class of 2015 is the most heavily-indebted college class in history and the chart is "up and to the right," which in the case of student loans, is anything but encouraging. Fortunately, we have some advice for this year's graduating seniors...

Unless you are growing sales i.e. expanding the business, any growth in cash flow is temporary.  And that is really the point of all this isn’t it? So go ahead boys tell me how the market is fairly valued.  Tell me that PE’s prove it.  Tell me how earnings are great and that unemployment is bang on in line with a full steam ahead economy.  Tell me the lackluster economic growth year on year since the big bang is just transitory pains with a bit winter thrown in.  I, like you, will smile and nod, both knowing it’s a lie and both of us preparing for the reset. 

In what was an "unambiguously" unpleasant April jobs payrolls report the fact that the number of Americans not in the labor force rose once again, this time to 93,194K from 93,175K, with the result being a participation rate of 69.45 or just above the lowest percentage since 1977, will merely catalyze even more upside to the so called "market" which continues to reflect nothing but central bank liquidity, and thus - the accelerating deterioration of the broader economy.

"Tah-dah" indeed...

"The median stock in the S&P 500 is the most expensive it has even been (for as long as we have data). That's never a good sign! If your favorite valuation indicator is not at 'the highest ever', then it is likely now at 'the highest ever except 2000'. That's not good company unless you are a short seller."