• Monetary Metals
    07/28/2014 - 02:38
    Notice the “icicles” dripping all over the place? They occur at different times of the day. What are they? Each one is a brief but dramatic price drop.

Tyler Durden's picture

John Hussman: "Make No Mistake - This Is An Equity Bubble, And A Highly Advanced One"

"Make no mistake – this is an equity bubble, and a highly advanced one. On the most historically reliable measures, it is easily beyond 1972 and 1987, beyond 1929 and 2007, and is now within about 15% of the 2000 extreme. The main difference between the current episode and that of 2000 is that the 2000 bubble was strikingly obvious in technology, whereas the present one is diffused across all sectors in a way that makes valuations for most stocks actually worse than in 2000. The median price/revenue ratio of S&P 500 components is already far above the 2000 level, and the average across S&P 500 components is nearly the same as in 2000. The extent of this bubble is also partially obscured by record high profit margins that make P/E ratios on single-year measures seem less extreme (though the forward operating P/E of the S&P 500 is already beyond its 2007 peak even without accounting for margins)."



Tyler Durden's picture

The Italian Government Owes Over $100 Billion To Private Suppliers

Much has been said in the popular press about Italy's surprising economic recovery (which based on recent data is starting to lose steam), as well as its much improved fiscal picture (even if the country's public debt hits record highs quarter after quarter and the bad debt within its banking system just rose by 24% from the prior year, to €169 billion the highest since 1998). Little has been said about just how Italy managed to pull this economic miracle off. The answer: robbing private suppliers to pay Paul, or rather, the public sector. According to Reuters, the Italian state owes some 75 billion euros ($102 billion)to private suppliers, as reported by the Bank of Italy. The unpaid bills have starved companies of cash and triggered layoffs, factory closures and bankruptcies.



Tyler Durden's picture

"London Fix" Gold Rigging By Bullion Bank Exposed In Class Action Lawsuit: The Complete Charts

While the allegations in the lawsuit are well-known to frequent (and all other) readers of Zero Hedge, we recommend reading the full filing as it explains in clear English just what the fixing process worked. Perhaps what is more interesting are the abnormalities in the price of gold as highlighted by Derksen, which clearly show the critical role the daily fix has in the manipulation of the price of gold, both in a downward and upward (mostly downward) direction: whichever suits the London Fix member banks.



Tyler Durden's picture

Gary Shilling: "Q2 GDP Was Closer To 1% Than To 3%. It Could Even Be A Negative Number"

This week, in the aftermath of the Q1 -2.9% GDP disaster, the biggest "non-recessionary" drop in 67 years which was blamed on harsh weather (because there have never been harsh winters in the past 67 years), we get the first glimpse of what Q2 GDP was in the US economy. It is expected to print just shy of 3%. However, one person disagrees: Gary Shilling believes that not only will Q2 GDP be closer to 1% than to 3%, there is a fairly good chance it could be negative, which of course would mean that the US economy has officially entered a recession.



Tyler Durden's picture

China Expands Live-Fire Gulf Of Tonkin Drill; Warns Of Massive Flight Disruptions

In a surprise announcement, China revealed that in addition to scheduled naval drills to be held near Vietnam (in case there isn't nearly enough tensions between China and the former US war foe) the country's Military of Defense announced that it would expand military drills in the East China Sea, which will re-escalate the already boiling territorial disputes which involve Japan, the Philippines and Vietnam. While the scale of the current drills is bigger than in the past, it’s a coincidence the annual exercises are being held at the same time, Beijing News reported yesterday, citing Zhang Junshe, a researcher at Navy Military Research Institute. The irony that this is happening as China is already conducting a massive live-fire drill off Beibu Bay, also known as Gulf ot Tonkin, will hardly escape readers, although we doubt even China will be so daring as to troll the US with a follow up "false flag" operation that launches a "contained" regional war.  In addition to Tonkin, China is also engaging in a drill in the Bohai Strait next to North Korea, and now: the East China Sea, just to make sure Japan and Taiwan are also covered just in case.



Tyler Durden's picture

Forget What They Say And Watch What They Do

Once again we are breaking records on a near weekly basis. Week after week and sometimes daily new never before seen in the history of financial markets record prints. Yet, business people across the spectrum don’t feel it, nor are they buying it. Should one be worried about this conundrum? Financial mavens say no. In earnest, most seem to insinuate one should “Just buy the all time highs and sleep like a baby.” Then again, that’s what they say all the time do they not? So what is someone to do that doesn’t believe the hype or the meme “it’s different this time” and can’t get that feeling out of their gut for they know – it truly never is? You pay attention to when implementations seem to be appearing on a near regular basis that can separate you from your money with, or by the force, of law.



Tyler Durden's picture

US Releases Satellite Images Allegedly Proving Russian Shelling Of East Ukraine

A week after Russia revealed photos of Ukraine deploying Buk missiles in the east as well as radar proof of Ukraine warplanes in the vicinity of MH-17, the US has yet to present any of the incontrovertible evidence supposedly in its possession that proves it was the separatists who shot down the plane, a narrative which has already propagated through western media. Instead, several hours ago the US. Office of the Director of National Intelligence released satellite images taken by the private civilian company Digital Globe (and thus not government sourced), which US officials say offer proof that Russian forces have been shelling eastern Ukraine in a campaign to assist rebel groups fighting Ukraine’s government in Kiev.



Tyler Durden's picture

America's Lost Decade: Typical Household Wealth Has Plunged 36% Since 2003

Does it feel like you're poorer? There is a simple reason why - you are! According to a new study by the Russell Sage Foundation, the inflation-adjusted net worth for the typical household was $87,992 in 2003. Ten years later, it was only $56,335, or a 36% decline... Welcome to America's Lost Decade.



Tyler Durden's picture

China Cements Eurasian Trade Routes With Great Silk Road Revival: The Infographic

When it comes to the rise of Eurasia as the ascendent axis set to oppose US global hegemony, conventional wisdom focuses on the roles of China and Russia. However, the changing geopolitical landscape is certainly far more nuanced than merely the "west" versus the BRICS, and as the following infographic from SCMP shows, China has been quietly working to recreate one of the most legendary trade routes, "the Silk Road", linking Africa to the Middle East (Iraq and Iran) to India, to Indonesia and all culminating in Beijing, while at the same time the reverse leg of the route goes to Kazakhstan, Moscow and ultimately, Germany. The purpose: "to enhance political and economic ties with southeast Asia and beyond."



Tyler Durden's picture

Runaway Ebola-Infected Woman Dies As US Doctor Tests Positive For Virus

It continues to go from worse to worser for Africa's "deadliest ever" Ebola epidemic which has officially claimed well over 600 lives, and unofficially many more. Following the death of a Liberian government worker two days ago who collapsed in the international airport of Nigeria's 20-million megacity, Lagos which resulted in a "red alert" Nigeria clamping down into a quasi-quarantine state, sending specialists to airports and seaports fo containment, overnight we got an update on the other major Ebola story from last week, namely the female patient whose family broke her out of a hospital in Sierra Leone's capital Freetown, and who had been on the loose of several days, leading to a nationwide hunt. She has passed away, dying in an ambulance on the way to hospital, Reuters reports. And while the US public has been generally unaware of the severity of the breakout, this may soon change following news that a 33-year-old US doctor in Liberia was the latest to test positive for the disease.



Tyler Durden's picture

Can Germany Carry Europe’s Weight In The Next Financial Crisis?

Within the European economic context Germany has been a star performer in recent years, outgrowing in GDP terms its Eurozone peer group as a whole in all but one year since 2006 (complete with a magnificent football/soccer team). This was quite a reversal of fortune from the ten years prior, when Germany consistently lagged in wealth creation. Together with its size and unwavering historical commitment to the EU project, this has created the expectation in political and even financial circles that if Europe faces another major economic crisis Germany will have no choice but to support the most vulnerable member states, possibly even relenting to the mutualisation of the Eurozone's debts. While this is a very complex topic, the following graph puts the odds in favor of one outcome: the next time push comes to shove in a big way, Germany will likely say NEIN!



Tyler Durden's picture

Has Fractional-Reserve Banking Really Passed the Market Test?

The reasons given for the persistence of the mispricing of fractional-reserve debt (IOUs + RP) are unsustainable in the long run. The lack of legal protection for genuine money titles is no more than a technicality, for there is nothing in practice that can sustainably prevent the existence of full reserve banks. Awareness that “deposits” are not actually money being held for safekeeping is a matter of educating the public, as is awareness that government’s deposit “guarantees” are not actually credible in the event of a systemic run.  If we assume, then, that fractional-reserve banking will come to its logical ending, there is good reason to believe that the shock will herald the endgame for fiat money. It is in fact the case that all fiat money is the liability of the central bank, which also carries the risk of non-repayment (default risk). This, again, means an arbitrage opportunity for market participants to withdraw the fiat money from the fiat money banking system. This confirms that the original basis for fiat money is destroyed, for its repayment to the central bank is not credible.



Tyler Durden's picture

Flight MH-17 Black Box Reveals "Massive Explosive Decompression"

While it was already reported that the black boxes of flight MH 17 were supposedly not tempered with, despite early propaganda attempts via planted YouTube clips to claim otherwise (clips which have since disappeared replaced by other propaganda), the question of what the data recovery team operating in London would find was unanswered, until earlier today when CBS reported that "unreleased data" from a black box retrieved from the wreckage of Malaysia Airlines Flight 17 in Ukraine show findings consistent with the plane's fuselage being hit multiple times by shrapnel from a missile explosion.



Tyler Durden's picture

Summarizing The President's Busy Weekend



Tyler Durden's picture

"It Can't Be A Bubble!"

If one wants to identify bubbles, one must perforce study monetary conditions. The comparison of historical data on valuations and other ancillary factors can only take one so far. The problem is that in times of strongly inflationary policy, the economy's price structure becomes thoroughly distorted, and that therefore a great many “data” can no longer be regarded as reliable... Most of the time, it's the eventual slowdown of money supply growth that brings a bubble to its knees.



Do NOT follow this link or you will be banned from the site!