The problem with all Keynesian styled philosophy is, it works well, and seems utterly brilliant on paper and in the classrooms of academia - when trouble arises its "To the text books!" for answers and BAM! – crisis solved. However in the real world it doesn't work that way. Just like war, when the battle starts, all earlier plans get thrown in the dust heap. And make no mistake, this was all started via armchair generals who believed monetary policy could be managed from within the Ivory Towers of academia and the consequences of these policies are multiplying by the day. As Mike Tyson once said so eloquently: (I’m paraphrasing) "Everybody's got a plan – till someone punches them in the face." The SNB has just landed the first blow. Now what?
- Alexis Tsipras: the Syriza leader about to take charge in Greece (Guardian)
- Tsipras to form anti-bailout Greek government after big victory (Reuters)
- Tsipras Forges Anti-Austerity Coalition in EU Challenge (BBG)
- East Coast braces, flights canceled as 'historic' blizzard bears down (Reuters)
- Rebels press Ukraine offensive, Obama promises steps against Russian-backed 'aggression (Reuters)
- Syriza Victory Brings Hope for Immigrants of EU Access (BBG)
- For Saudis, Falling Demand for Oil Is the Biggest Concern (BBG)
- Oil prices fall on market relief over Saudi policy (Reuters)
This morning both the SNB stunner from two weeks ago, and the less than stunning ECB QE announcement from last Thursday are long forgotten, and the only topic on markets' minds is the startling surge of Syriza and its formation of a coalition government with another anti-bailout party - a development that many in Europe never expected could happen, and which has pushed Europe to the bring of the unexpected yet again. And while there is much speculation that this time Europe is much better positioned to "handle a Grexit", the reality is that European bank balance sheets are as bad if not worse than in 2014, 2013, 2012 or any other year for that matter, because none of ther €1+ trillion in NPLs have been addressed and the only thing that has happened is funding bank capital deficiencies with newly printed money. You know what they say about solvency and liquidity.
China has some stunningly beautiful natural landscapes, but, as boredpanda.com explains, they may not count for much when, in other parts of the country, pollution runs totally unchecked. China is very close in size to the USA. Yet, as The Burning Platform notes, their population is the size of the entire Western Hemisphere, plus Japan, Germany, and France. The land can not support this mass of humanity without very dire consequences, and these shocking photos show what severe pollution people have to deal with in some parts of China...
"My humble thesis tonight is that the entire 20th Century was a giant mistake. And that you can put the blame for this monumental error squarely on Thomas Woodrow Wilson - a megalomaniacal madman who was the very worst President in American history... well, except for the last two."
When you read about female doctors feeling forced to prostitute themselves to feed their children, about the number of miscarriages doubling, and about the overall sense of helplessness and destitution among the Greek population, especially the young, who see no way of even starting to build a family, then I can only say: Brussels is a bunch of criminals. And Draghi’s QE announcement is a criminal act. It’s a good thing the bond-buying doesn’t start until March, and that it’s on a monthly basis: that means it can still be stopped.
“No stock-market crash announced bad times. The depression rather made its presence felt with the serial crashes of dozens of commodity markets. To the affected producers and consumers, the declines were immediate and newsworthy, but they failed to seize the national attention. Certainly, they made no deep impression at the Federal Reserve.” - 1921 or 2015?
The US Dollar rally, combined with the ECB’s policies are at risk of blowing up a $9 trillion carry trade.
Well the day has finally arrived that after two years of promises, jawboning and hope - the European Central Bank finally announced they will take the plunge into the Quantitative Easing (QE) pool. Whether or not the ECB's QE program has the desired effect or not will not be realized for a while. However, this week's reading list is a variety of opinions and initial takes on the "ABC's of the ECB's QE."
There is no reason to assume that this time will be different. These boom-bust sequences will continue until the economy is structurally undermined to such an extent that monetary intervention cannot even create the illusory prosperity of a capital-consuming boom anymore. The bankers applauding Draghi’s actions today will come to rue them tomorrow.
Another day goes by. Another day of the West’s (the One Bank’s) economic terrorism against Russia: an overt attack on that nation’s currency, and thus the economy itself. As noted in the commentary which preceded this; such economic terrorism against the ruble damages Russia’s economy, on a percentage-for-percentage basis.
Another day of defiance: by Russia itself, and (increasingly) the Rest of the World. We now know that part (and perhaps most) of the motive for this escalation of Western terrorism against Russia is gold.
Euro Crash Continues Sending Stocks Higher, Yields To Record Lows; Crude Stabilizes On New King's CommentsSubmitted by Tyler Durden on 01/23/2015 07:03 -0500
Today's market action is largely a continuation of the QE relief rally, where - at least for the time being - the market bought the rumor for over 2 years and is desperate to show it can aslo buy the news. As a result, the European multiple-expansion based stock ramp has resumed with the Eurostoxx advancing for a 7th day to extend their highest level since Dec. 2007. As we showed yesterday, none of the equity action in Europe is based on fundamentals, but is the result of multiple expansion, with the PE on European equities now approaching 20x, a surge of nearly 70% in the past 2 years. But the real story is not in equities but in bonds where the perfectly expected frontrunning of some €800 billion in European debt issuance over the next year, taking more than 100% of European net supply, has hit new record level.
History proves a government can’t be fiscally responsible and the policeman of the world. All great empires were befallen by the inability of resources to keep up with ambition. From Alexander the Great to Rome to the great British Empire, hegemony doesn’t last forever. The U.S. government guarantees security to over 35 countries and has troops stationed in over 146 countries. Does such an astounding presence – completely unmatched by previous empires – really sound all that sensible?
The psychopathologizing of anti-authoritarian behavior is yet another step on what looks like an increasingly slippery slope and it strikes us as especially harmful. The American Diagnostic and Statistical Manual of Mental Disorders (DSM for short) defined a new mental illness, the so-called “oppositional defiant disorder” or ODD. As TheMindUnleashed.org informs us, the definition of this new mental illness essentially amounts to declaring any non-conformity and questioning of authority as a form of insanity. In short, as Natural News put it: According to US psychiatrists, only the sheeple are sane.
If speeches like the State of The Union this week, and the reactions to it, make anything clear, it’s that the PR guys won the fight against critical thinking. All you need to do is get people to believe whatever it is you got for sale. And 99.9% of people are easily fooled. That’s how you define democracy in 2015: how many people can you fool? Which is the most convincing sleight of hand?