New Normal

These Are The Best And Worst U.S. Cities To Own A House

At the top, with annual price increases over 9% and as high as 11.9% in the case of Portland, we also find Seattle Denver and - of course - San Francisco. On the other end are Washington, Chicago and oddly enough, New York. We wonder if Case Shiller used the UMich "random" telephone directory to calculate that NYC home prices rose at precisely the rate of core inflation in the past 12 months while ignoring the dramatic moves in the ultra luxury high end segment.

Why Oil Dropped: Saudis Set To Boost Production In Scramble For Chinese Demand

After meandering steadily higher for the past week, and completely ignoring the negative newsflow out of the Doha meeting, today oil took an unexpected leg lower to 4-day lows, leaving many stumped: what caused this drop? The answer: it looks increasingly likely that the Kingdom is targeting another 0.5-m b/d of sales, bringing its production up to a steadier 11-m b/d or higher as it scramble to regain Chinese market share lost in recent months to Russia.

CEOs Are Hopeful But "Looking For A Macro Curveball"

It's not just Halliburton ("What we are experiencing today is far beyond headwinds; it is unsustainable") and Intel (12,000 layoffs amid re-evaluation of programs) that are facing up to a new normal very different from expectations. As Avondale Asset Management notes, having poured over 100s of earnings transcripts, while most CEOs don’t see signs of an imminent downturn, the environment still feels a little fragile. It seems that almost everyone is on high alert for a macro curve-ball...

Weekend Reading: It's Probably A Trap

The “bullish case” is currently built primarily on “hope.” Hope the economy will improve in the second half of the year; Hope that earnings will improve in the second half of the year; Hope that oil prices will trade higher even as supply remains elevated; Hope the Fed will not raise interest rates this year; Hope that global Central Banks will “keep on keepin’ on.”  Hope that the US Dollar doesn’t rise; Hope that interest rates remain low; Hope that high-yield credit markets remain stable.

China's Other Big Problem - Porkflation

For those who believe that broad-based stimulus is coming to save the world from China (via RRR cuts or even pure QE) - as opposed to the hole-filling credit pump they just supported - think again. As we warned last year, this is 'western' thinking as the go to policy of the rest of the world's central banks has been - put on pants, print money, paper over cracks, proclaim victory. However, in China there is one big problem with this... stoking inflation... and most crucially the social unrest concerns when suddenly a nation of newly minted equity - and now bond - losers can no longer afford their pork - which is surging to record highs.

Trump Hints He Would Replace Janet Yellen

Three weeks after angering the mainstream media with his apocryphal assessment that the US "Is Headed For A Massive Recession" and that "It's A Terrible Time To Invest In Stocks", Trump is likely set to make even more waves with an interview he gave to Fortune magazine, which will be released in its entirety later this week, in which Trump says that while he likes Janet Yellen’s low interest rates, he is not a big fan of Janet Yellen herself.  "I think she’s done a serviceable job," Trump tells Fortune. "I don’t want to comment on reappointment, but I would be more inclined to put other people in."

Intel Fires A Massive 12,000 Workers, 11% Of Its Entire Workforce, As It Misses Q1 Sales, Guides Lower

There were some rumors reported late last week that the world's biggest chip maker was about to fire a major portion of its workforce. Moments ago the company confirmed these rumors, when it reported that it was firing a whopping 11% of its entire workforce, laying off a massive 12,000 workers. Confused? Don't be: it's all part of the new normal recovery, and don't forget the spin: don't think of its as 12,000 highly paid engineers and tech workers fired, think of it as 12,000 brand spanking new waiters and bartenders.

One Trader Finally Loses It

"A portfolio built to only withstand stress thanks to central bank intervention is one destined to blow-up spectacularly."

Pepsi Earnings Explained For 17-Year-Old Hedge Fund Managers

Just to help 17-year-old hedge fund managers reconcile the confusion generated by Pepsi's two sets of numbers, the ghastly GAAP ghastly, and the nice non-GAAP, the company continued the tradition of dramatically dumbing down everything that happens in the quarter with yet another admission that it knows very well who its main "investor base" is these days, namely "attention-deficited", 17-year-old hedge fund managers (and algos of course), all of whom need a simple, portable story on which to BTFD (or BTFATH).

Standing At The Crossroads

The market is standing at the proverbial “crossroads” of bull and bear. From a “fundamental” perspective there is not much good news. The past week we saw numerous companies beating extremely beaten down estimates. However, while JPM and C got a boost to their stock price, the actual earnings, revenue and profits trends were clearly negative. But that is the new normal. We live in an environment where Central Banking has taken control of financial markets by leaving investors “no option” for a return on cash. Therefore, the “hope” remains that asset prices can remain detached from underlying fundamentals long enough for them to catch up.

Denmark, Belgium, Now The Netherlands: Negative Mortgage Rates Spread Across Europe

"Unless a miracle happens and the European and Japanese economic cadavers suddenly sit up and rub their eyes, central banks will eventually have to give up and admit defeat. The hope will be that not too much damage has been inflicted.... But that is central banking for you, in the era of leverage: take from the savers and give to the borrowers in the hope that they will "do something".Not so far, they’re not … they’re just punting it on real estate."

These Are The 10 Worst (And Best) Jobs In America

A new survey of the best and worst jobs in the country has declared that being a newspaper reporter (blogger may or may not fall under this umbrella definition) is the worst career you could be pursuing.

WTI Crude Tops $42 As Russia "Hopes" For Deal At Doha

Despite the day's rampacious rally in stocks and crude aftwer "unidentified sourtces" said a Russia-Saudi deal was done, Russia's Dmitry Peskov just issued a statement that "there is hope" for a deal at Doha. This sent stocks and crude jumping once again... even though we suggest "hope" for a deal is not "a deal."