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The World's Greatest Oil Chokepoints, And Why Yemen Matters

About half the world's oil production is moved by tankers on fixed maritime routes, according to Reuters. The blockage of a chokepoint, even temporarily, can lead to substantial increases in total energy costs and thus, these checkpoints are crucial to global energy security. While Hormuz remains the largest chokepoint (and along with Bab el-Mandeb explains why Yemen matters so much), Malacca (as we noted previously) is quickly becoming another area of potential problems.



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Caught On Tape: Saudi Warplanes Bomb Yemen

Yesterday we saw the tracers against the dark night sky, tonight we get the video of Saudi warplanes bombing various Houthi positions. All looks quite "decisive" to us...



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It's The End Of March And 99.85% Of California Is Abnormally Dry Already

With NASA scientists warning about California only having one year of water left, it appears The Kardashians and March Madness continue to distract Americans from the ugly looming reality of water shortages. With summer around the corner, the US Drought Minitoring service reports today that a stunning 99.85% of California is "abnormally dry," and 98.11% of the state is in drought conditions leaving over 37 million people in harm's way.



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The US Housing Bubble In One Chart: Home Prices Outpace Wage Growth 13:1

If there is one chart that most clearly captures the unsustainable US home price appreciation bubble, it is the following which was released overnight from RealtyTrac: home price appreciation nationwide has outpaced wage growth by a 13:1 ratio!



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The US-Iran "Misunderstanding"

Lost in translation?



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China "Is Not Another US", Does Not Seek "Yuan Hegemony"

"The establishment of the Asian Infrastructure Investment Bank (AIIB) has been depicted by a few overseas media outlets as if China is building its own version of the Bretton Woods system. The Bretton Woods system is a product of the old days. The new global trends created the AIIB and there is no room to look back to the old days of one currency's hegemony," a state-controlled news outlet says, just as China pushes for yuan dominance in the AIIB.



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3 Things: No Money, Wall Street's Big Scam, Bottom 80%

Much of the commentary from the more liberal leaning media has continued to tout that the rise in asset markets over the last few years are clear evidence of economic prosperity in this country. However, is that really the case? In order for rising asset prices to be reflective of overall economic prosperity, the "wealth" generated by those rising asset prices should impact a broad swath of the American populous. Let's take a look to see if that is the case.



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That Ain't No Margin Debt: THIS Is Margin Debt

We find it amusing how many people try to read into the tealeaves when looking at the NYSE margin debt, when the real action is half way around the world. Because, in the imortal words of Crocodile Dundee, "That is not margin debt. This is margin debt."



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Building Explodes, Collapses In Manhattan, Multiple Injuries Reported - Live Webcast

While it is unclear at this moment if this is merely the latest casualty of below normal Capex (or was the result of a gas leak), or if there was foul play involved, moments ago the NYC scanner was lit up with reports that a building had collapsed, following an explosion, on 7th street and 2nd avenue, in the East Village in Manhattan.



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Yemen Ground Invasion By Saudi, Egyptian Troops Imminent

Moments ago AP reported that Egyptian military and security officials told The Associated Press that the military intervention will go further, with a ground assault into Yemen by Egyptian, Saudi and other forces, planned once airstrikes have weakened the capabilities of the rebels. "The assault will be by ground from Saudi Arabia and by landings on Yemen's Red and Arabian Sea coasts. The aim is not to occupy Yemen but to weaken the Houthis and their allies until they enter negotiations for power-sharing, the officials said."



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What Would Happen If ETF Holders Sold All At Once? Howard Marks Explains

What would happen, for example, if a large number of holders decided to sell a high yield bond ETF all at once? In theory, the ETF can always be sold. Buyers may be scarce, but there should be some price at which one will materialize.  But we can’t get away from depending on the liquidity of the underlying high yield bonds. The ETF can’t be more liquid than the underlying, and we know the underlying can become highly illiquid.... no investment vehicle should promise more liquidity than is afforded by its underlying assets. Do these recent promises represent real improvements, or merely the seeds for subsequent disappointment?



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CSX Cuts Outlook Despite CEO Saying "Expects No Impact From Low Oil Prices"

When CSX CEO Michael Ward arrogantly strode onto CNBC six weeks ago and proclaimed, he has "not seen any changes," suggesting everything's fine down to $30-35 oil and "expected no impact on crude shipments," we carefully suggested he was being a little careful with the truth. So, when today, the company issued the following statement:

*CSX DOESN'T EXPECT TO REACH HIGH END OF CRUDE-BY-RAIL FORECAST

We could not help but wonder just how rapidly the deterioration had occurred or if, once again, a CEO had come on business media and lied through his teeth.



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Putin Says Attempts To Tip Nuclear Balance Don't Scare Russia, Moscow Will Uncover "Schemes"

Russia is once again ratcheting up the rhetoric, this time to a fever pitch. Just a day after Putin’s Security Council posted a remarkably accurate and amusingly concise assessment of US foreign policy aims on its website, a spokesman for the Russian Foreign Ministry as well as President Putin himself are out with strong condemnations of both the NATO presence in Eastern Europe as well as US plans to arm Kiev.



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