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On Washington's Ukrainian Fiasco: "Who Is The Real Problem Here?"

In just 800 words Pat Buchanan exposes the sheer juvenile delinquency embodied in Washington’s current Ukrainian fiasco.
What motivates Putin seems simple and understandable. He wants the respect due a world power. He sees himself as protector of the Russians left behind in his “near abroad.” He relishes playing Big Power politics. History is full of such men. But what motivates those on our side who seek every opportunity to restart the Cold War? Is it not a desperate desire to appear once again Churchillian, once again heroic, once again relevant, as they saw themselves in the Cold War that ended so long ago? Who is the real problem here?

 



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China Raids Multiple Microsoft Offices, Media Demands "Severe Punishment"

With Chinese state media calling for "severe punishment" against American tech firms for helping the U.S government to steal secrets and monitor China, Reuters reports that Microsoft offices in Beijing, Shanghai, Guangzhou and Chengdu were raided this weekend. Chinese officials declined to give any reasons for the inspections. Whether this is ongoing blow-back from NSA revelations or a back-door Russia retaliation is unclear, but it is an escalation from the ongoing Windows 8 ban. Microsoft's only response, "we're happy to answer the government's questions."



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Today's Other Anniversary

As most are aware by now, today is the 100th anniversary of the start of World War I - the war which was supposed to end all wars, when in reality, in conjunction with the Federal Reserve - which was created just few shorts months prior - it merely unleashed the most deadly series of wars the world has ever seen. What may be less known is that today's "other" anniversary is perhaps just as momentous, if not (yet) as destructive or GDP boosting: on July 28, 2004 is when America got its first glimpse of a political newcomer few if any had heard of previously. Barack Obama.



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Is This How China Will Deal With Its Massive Mal-Investment?

There is no doubt that China's massive credit-fueled expansion has created the largest mal-investment boom the world has ever known (no matter how much anticipated urbanization or consumerization one really believes in)... so we wondered, how will they deal with this problem? Perhaps the following creative destruction is necessary...



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US May Send Military Aid To Ukraine; Accuses Russia Of Violating Nuclear Arms Treaty With ICBM Launch

If the specter of the second cold war descending into outright smoldering status doesn't send the S&P promptly to all time highs, nothing will. Moments ago the White House accused Russia of violating the 1987 missile treaty, in response to a still unspecified ICBM launch, calling the "breach" a "very serious matter." Bloomberg added that at issue was a ground-launched ICBM missile. And just so it is clear that the US is now picked the "escalation" of the prisoner's dilemma,  also moments ago AGP reported that the US is now weighing the risks of aiding Ukraine militarily. Specifically, senior American military officers are discussing the possibility of "providing Ukraine with more precise intelligence that would allow it to target missiles held by pro-Russian forces, US officials said Monday."



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Ukraine Army Takes Bloomberg Reporter Hostage: Fascinating Report Ensues

Thanks to a 5-word text message to his father, a Bloomberg reporter was taken hostage by Ukrainian soldiers at a checkpoint near Donetsk. What ensued is both frightening and fascinating...



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Is This The Chart That Has High-Yield Investors Running For The Hills?

We discussed the major rotation, overvaluation, and underperformance of high-yield credit markets recently as relevering stock-buying-back firms find their source of funding starting to dry up. The question is - why now? Perhaps this chart of the wall of maturing corporate debt ($3.9 trillion by 2019 which will need massive liquidity to roll-over and will eat earnings thanks to higher coupons) is what triggered the anxiety as the end of QE and start of rate-hikes looms close...



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Japanese Unemployment Jumps To Worst In 2014 As Household Spending & Retail Sales Drop For 3rd Month

Against an forecast drop to 3.5% joblessness, Japan's unemployment rate missed expectations by the most in 10 months and surged to 3.7% (its highest since Dec 2013). That likely explains why household spending and retail sales both dropped for the 3rd month in a row... (and why Abe's approval rating just broke back under 50%).



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Mass Incarceration: 21 Amazing Facts About America’s Obsession With Prison

Nobody in the world loves locking people behind bars as much as Americans do.  The US has more people in prison than any other nation on the planet.  The US also has a higher percentage of the population locked up than anyone else does by a very large margin.  But has all of this imprisonment actually made the US safer?  Well, the last time we checked, crime was still wildly out of control in America and for the most recent year that we have numbers for violent crime was up 15 percent.  The number of people that we have locked up has quadrupled since 1980, but this is not solving any of our problems. 



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You Know Iraq's Bad When...

While Malaysian Airlines may have still been flying over warzones, it appears things have become so unstable and dangerous in Iraq that none other than Emirates Airlines has chosen to "re-route' around the troubled nation:

*EMIRATES TAKING PRECAUTIONARY MEASURES TO AVOID IRAQ AIR SPACE

The re-routing is expected to take a few days according to an emailed statement as Emirates joins numerous other airlines in avoiding playing 'missile launcher roulette' with their passenger's lives to save a few bucks on gas. Of course, with the world increasingly at war, airspace (and energy) needs may soon be at a premium once again.



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NYSE Margin Debt Storms Back To All Time Highs

After dropping modestly from all time highs hit in February, NYSE margin debt has recouped virtually all its losses and is now essentially back to all time highs. And as a parallel to that, investor net worth, defined as total Free Credit Cash and Credit Balances in Margin accounts less Margin Debt, has once again dropped to all time lows.



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Here's How Obama Can Halt "Tax Inversions" Without Congress (& Why It Doesn't Matter)

As the topic of "unpatriotic" 'tax inversions' becomes a political issue, we thought it interesting to examine how big an economic issue it really is. How much income tax do U.S. companies actually pay every year to the Federal government? As ConvergEx's Nick Colas notes, the simple answer is “Not much”, at least as compared to any other major source of revenue. In Fiscal 2013, Colas adds, the total was $274 billion, or just 9.9% of all tax and withholding receipts. Your political leanings will inform your opinion about whether that number is too high or too low, of course; but we point out that, as Reuters reports, a former  international tax counsel at Treasury explains Obama could "slam dunk" dictate an end to 'tax inversions' without Congressional approval (by invoking a little known 1969 tax law)



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Marc Faber Responds To CNBC Mockery, Asks "How Has CNBC's Portfolio Done Since 1999?"

Having provided his clarifying perspective on why the markets are extremely fragile and due for a 20-30% correction, Marc Faber was assaulted by CNBC's Scott Wapner reading off a litany of recent calls that have not worked out as planned. His response was notable: "I started to work in 1970, and over that career, somehow, somewhere, I must have made some right calls; otherwise I wouldn't be in business." What CNBC then edited out of the transcript was Faber pointing out his 22% annualized return in his publicly-viewable funds since then and asking - sounding somewhat frustrated at the anchor's mockery (and background snickers) - "I wonder what the CNBC portfolio would look like since 1999?" The response: silence.



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Why Herbalife Is Crashing After Hours In Two Charts

Here are the two most important charts which explain why the stock is crashing over 11% after hours.



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Most Transparent Insider Trading Congress Ever Tells SEC To Shove it

"Do as we say, not as we do," appears the modus operandi of the current administration's increasingly totalitarian regime. Today's edition of 'wait, what?' comes from The WSJ who report that The U.S. House of Representatives told a federal court Friday it should dismiss a lawsuit filed by the SEC (regarding the long-running insider-trading investigation) because Congress is lawfully allowed to ignore requests to turn over records and testimony to the executive branch agency. Arguing "sovereign immunity" and responding in a rather snarky (almost "do you know who we are?" manner), House attorneys blasted the SEC's "fool's errand."



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