Meltdown

Tyler Durden's picture

The Magic Of CPI: Watch How Economists Transform A 400% Price Increase Into A 7.1% Decline





Confused how your cost of living increase is always orders of magnitude above the "inflation" reported by the BLS' Consumer Price Index? Then prepare for your daily dose of Keynesian epiphany, with this step by step guide from the BLS of how to use the Hedonic Quality Adjustment to turn a 400% price increase into a 7.1% decline.

 

 
Phoenix Capital Research's picture

Will the US Dollar Trigger Another 2008 Event?





The US Dollar is moving up RAPIDLY. Will this blow up the financial system as it did in 2008? We’ll soon find out.

 
 
Tyler Durden's picture

1,001 Nights Of Stock Market Stories





There is an old Wall Street chestnut that goes, “It’s not a stock market; it’s a market of stocks.”  Fair enough, but we’ll take a different approach today to complete this aphorism: “It is a market of stories.”  Yes, it is stories that vie for our attention, define our realities, and spur us to action.  Recent academic work on the subject reveals that the right narrative – ideally one with a strong human element – physically changes how we process information and make us more likely to empathize with and ultimately believe the stories we hear.  Too fluffy a concept for you?  The research we cite was partially funded by the U.S. Department of Defense’s Advanced Research Projects Agency (DARPA), and when they have an interest in something, rest assured it has a very serious purpose.  As for applications in the world of investing, recognizing powerful stories earlier than the pack is pretty much the job description for a nalysts and portfolio managers alike.  Just be aware that it is all too easy to fall for one as well. 

 
Tyler Durden's picture

Anatomy Of A Failing State: Japan's Budgetary Nightmare





What do you get after 25 years of stagnation and Keynesian Cargo Cult monetary stimulus? A failing state, that's what. The intellectually bankrupt ruling Elites of Japan have no solution for Japan's slow stagnation, as real reform would diminish their wealth and power. So their only "solution" is to double-down on monetary stimulus. Once the global economy rolls over into contraction, the tide will recede and Japan's fiscal and monetary bankruptcy will become painfully apparent.
 
Tyler Durden's picture

Nomi Prins: Why The Financial & Political System Failed And Stability Matters





The recent spike in global political-financial volatility that was temporarily soothed by ECB covered bond buying reveals another crack in the six-year-old throw-money-at-the-banks strategies of politicians and central bankers. The very fact - that without excessive artificial stimulation or the promise of it - more hell breaks loose - is one that government heads neither admit, nor appear to discuss. But the truth is that the global financial system has already failed. The political system that stumbles to sustain the illusion that economies can be built on rampant financial instability, has also failed us. Past presidents talked of a square deal, a new deal and a fair deal. It’s high time for a stability deal that prioritizes the real financial health of individuals over the false one of financial institutions.

 
Tyler Durden's picture

We Don't Have One Problem - We Have Three Interlocking Sets Of Problems





The conventional view tacitly assumes the global economy is dealing with one problem: recovering from the Global Financial Meltdown of 2008-09. Stimulating a "recovery" has been the focus of central banks and states everywhere. However, the additional sets of problems added as "solutions" only guarantee that the third and final crash of asset bubbles just ahead will be far more devastating than the crashes of 2000 and 2009.

 
Tyler Durden's picture

A Furious Albert Edwards Lashes Out At Central Bankers: "Will These Morons Ever Learn?"





Albert Edwards is angry, and understandably so: almost exactly two weeks after warning readers to "sell everything and run for your lives" and the market was on the verge of its first correction in years, several powerful verbal interventions by central banks from the Fed, to the BOJ to the ECB have staged yet another massive rebound which has nearly wiped out all the October losses. Central-planning aside (and ask how much the USSR would have wished for central planning to indeed have been "aside") we share his frustrations, almost to the point where we would reiterate word for word Edwards' furious outburst, as follows: "Simply put, the central banks for all their huffing and puffing cannot eliminate the business cycle. And they should have realised after the 2008 Great Recession that the longer they suppress volatility, both economic and market, the greater the subsequent crash. Will these morons ever learn?"

 
Phoenix Capital Research's picture

The Fed's Hands Are Tied Unless the Market Crashes





Having just engaged in QE for TWO SOLID YEARS STRAIGHT the Fed would totally destroy any and all credibility in its monetary policies to engage in QE anytime within the next three to six months.

 
 
Marc To Market's picture

Post-Taper Tantrum II: The Week Ahead





If there is a cabal running things, they are not doing a good job.  Maybe they are not really running things.  Here is what next week looks like if we did not know it was all pre-determined.  

 
Tyler Durden's picture

Forget Ebola - Here's Why US Banks Are Now Extremely Vulnerable





With a combined position of nearly $2 trillion in US government debt, against which they hold little or no capital buffer, US banks are now extremely vulnerable to a bond market sell-off.

 
Tyler Durden's picture

5 Things To Ponder: "Buy" or "Run"





This past week investors took a blow from a sharp selloff in the financial markets. Now that the correction has occurred, at least to some degree, the question that must be answered is simply: “Is it over?” That is the basis of this weekend’s reading list which is a compilation of reads that debate this point. The bulls remain wildly bullish, believing that this is simply a “dip” in the ongoing “bull market.” The more pessimistic crowd sees the opposite.

 
Tyler Durden's picture

Deflation Flirts With America





"I see deflation flirting with America." Retail sales equals consumer spending equals velocity of money. And unless the money supply is rising, hardly likely in the taper, less spending is deflation by definition. Forget about PMI and all that kind of data, it’s much simpler than that. Central banks can do all kinds of stuff, but they can’t make us spend our money on things we don’t want or need. Let alone make us borrow to do so. And if we don’t, deflation is an inevitable fact. That doesn’t mean prices for some items won’t go up, but that’s not what counts. It’s about how fast we either spend the money we have – if we have any left – or how much we borrow. And if time is money, then borrowed money is borrowed time. So we really shouldn’t.

 
Tyler Durden's picture

Why Is the Put-Call Ratio (Fear Gauge) Higher Than In The Lehman Collapse Of 2008?





The rising fear may reflect a shift in sentiment from faith in the omnipotence of central banks to skepticism.

 
Tyler Durden's picture

Will The Fed Let The Stock Market Crash Before An Election?





If central banks have learned anything since 2008, it's that waiting around for the panic to deepen is not a winning strategy. Put yourself in their shoes. Isn't this what you would do, given the dearth of alternatives and the very real risks of implosion? Anyone in their position with the tools at hand would not have any other real option other than to buy stocks in whatever quantity is needed to reverse the selling and blow the shorts out of the water. If $1 trillion doesn't do the job, make it $3 trillion, or $5 trillion. At this point, it doesn't really matter, does it?

 

 
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