Nobel Laureate

The Recent Liquidation Avalanche As Explained By Dan Loeb, And Why He Is Back To Shorting Stocks Again

"Amidst this volatility and performance dispersion, we struggle with our instinct that it is a good time to short stocks with the reality of the past few years of short-selling carnage. We were intrigued by investment legend Julian Robertson’s recent comments that, “we had a field day before anyone knew anything about shorting. It was almost a license to steal. Nowadays it’s a license to get hosed.” There is no doubt that the complexities around single name short selling have increased massively following 2008 – partly as a function of government regulation and intervention, partly due to negative rebates being the norm – but we have slowly been getting back in to the shallow end of the pool." - Dan Loeb

Bill Gross Quits PIMCO, Which He Co-Founded, Joining Janus

After co-founding PIMCO in 1971, Bill Gross has called it quits...

*WILLIAM H. GROSS JOINS JANUS CAPITAL
*JANUS:GROSS TO START MANAGING FUND,RELATED STRATEGIES OCT.6,'14

“I look forward to returning my full focus to the fixed income markets and investing, giving up many of the complexities that go with managing a large, complicated organization,” said Mr. Gross. Full Bill Gross, Dick Weil statements...

Has Ukraine Shot Itself In The Foot With Gas Pipeline Deal?

Last week, Ukrainian Prime Minister Yatsenyuk pushed a bill through the Verkhovna Rada that would see his country’s gas transportation system sold off to a group of international investors. The provisions of the law would permit the transit of natural gas to be blocked. This decision may hurt the fragile industrial recovery in Germany and finish off Ukraine’s potential as a gas transit route to Europe.

What Does Bitcoin Mean For Austrian Money Theory?

Libertarians tend to agree with each other on most things. We all favor less government regulation, lower taxes, less involvement in international conflicts, and more personal freedom. There are a few areas, however, in which the movement remains sharply divided. One of these areas involves the nature of money. The two schools of thought are essentially the “gold standard” crowd versus the “competing currencies” crowd.

Carl Icahn Reiterates "We Are In A Major Asset Bubble"

A month ago, Carl Icahn told told CNBC that he was "very nervous" about US equity markets. Reflecting on Yellen's apparent cluelessness of the consequences of her actions, and fearful of the build of derivative positions, Icahn says he's "worried" because if Yellen does not understand the end-game then "there's no argument - you have to worry about the excesssive printing of money!" Today he follows up that warning with an op-ed that states "we are in a major asset bubble that continues to grow," supporting Stiglitz comments that "these very strong stock market prices are in a sense a symptom of the weak economy, not a symptom that we are about to have a strong recovery to our real economy."

Frontrunning: July 14

  • Secret Path Revealed for Chinese Billions Overseas (BBG)
  • Traders Flood U.S. With $3.4 Trillion of Bond-Auction Demand (BBG)
  • Just in time to cover bad earnings in a massive $3.8 billion "one-time charge": Citi says to pay $7 billion to settle securities investigation (Reuters)
  • Troubled Epirito Santo family loosens grip on Portugal's BES (Reuters)
  • BES puts in place new executives after central bank push (Reuters)
  • Bank of China-CCTV drama may reveal power struggle in Beijing (SCMP)
  • Portugal speeds up Banco Espírito Santo management changes (FT)
  • Dark pool probe builds pressure on Barclays boss (Reuters)
  • Russia Vows to Respond After Shelling From Ukraine (BBG)
  • Ukraine forces end rebel airport blockade (Reuters)
  • Obama Contends With Arc of Instability Unseen Since '70s (WSJ)
GoldCore's picture

Underappreciated risks to electronic bitcoin and all forms of investments and savings today, including gold, that are held electronically come in the form of modern warfare - involving as it does cyberwarfare and electromagnetic warfare. No electricity and no computer or internet access and you cannot access your savings, investments and money ...

Krugman, Who Is Paid $25,000/Month To Study Inequality, Says "Nobody Wants Us To Become Cuba"

Krugman: "There's zero evidence that the kind of extreme inequality that we have is good for economic growth. In fact, there's a lot of evidence that it is actually bad for economic growth. Nobody wants us to become Cuba." Ah yes, inequality, the same inequality that the Fed - Krugman's favorite monetary stimulus machine - has been creating at an unprecedented pace since it launched QE. Just recall: "The "Massive Gift" That Keeps On Giving: How QE Boosted Inequality To Levels Surpassing The Great Depression." So while Krugman is right in lamenting the record surge in class divide between the 1% haves and the 99% have nots, you certainly won't find him touching with a ten foot pole the root cause of America's current surge in inequality. And, tangentially, another thing you won't find him touching, is yesterday's revelation by Gawker that the Nobel laureate is the proud recipient of $25,000 per month from CUNY to... study inequality.

Futures Ignore Overnight Newsflow, Prepare For More Yen-Driven Momentum Ignition

One can see that while the traditional 6:00 AM USDJPY buy program is just duying to resume aggressive upward momentum ignition, futures are still leery and confused by the recent post-open high beta selloffs. Then again, things like yesterday's ridiculous no news 3:30pm ramp happen and confused them even more just as momentum is about to take a downward direction. Stocks in Asia (ex-China) advanced amid a reversal in sentiment after Citigroup (+4.15%) inspired positive close on Wall Street, however Shanghai Comp (-1.4%) underperformed as concerns over GDP data on Wednesday following weak money supply data weighed on sentiment. Stocks remained on the back foot (Eurostoxx50 -0.42%), with Bunds supported by the release of lower than expected German ZEW survey and also ongoing concerns surrounding the stand-off between Ukraine/Russia. Short-Sterling bear steepened after UK CPI fell to its lowest level since October 2009, but house prices across Britain posted its biggest rise since June 2010, reviving concerns over an overheating market.

The Problem With Forward P/Es

It is always interesting that, following two major bear markets, investors have forgotten that it was these very same analysts that had them buying into the market peaks previously. As we know repeatedly from history, extrapolated projections rarely happen.  Therefore, when analysts value the market as if current profits are representative of an indefinite future, they have likely insured investors will receive a very rude awakening at some point in the future. There is mounting evidence, from valuations being paid in M&A deals, junk bond yields, margin debt and price extensions from long term means, "exuberance" is once again returning to the financial markets.

Guest Post: Why Keynesian Political Economy Is Theft

The plague of our time is Keynesian economics. It has destroyed the economics profession and enabled the political class to obtain powers never intended. Keynesian economics provided the intellectual cover for the criminal class we politely call “government” to plunder its citizenry.

Pivotfarm's picture

Stiglitz: “Sick”!

Joseph Stiglitz, Nobel Laureate and Professor at Columbia University believes that the US economy was and still is sick. He believes that it will remain sick because of bad choices that have been made from 2008 onwards:

Market Bulls Should Consider These Charts

There have been a litany of articles written recently discussing how the stock market is set for a continued bull rally.  These are some primary points that are common threads among each of these articles which are:  1) interest rates are low, 2) corporate profitability is high, and; 3) the Fed's monetary programs continue to put a floor under stocks.  The problem is that while we do not disagree with any of those points - they are all artificially influenced by outside factorsInterest rates are low because of the Federal Reserve's actions, corporate profitability is high due to accounting rule changes following the financial crisis and the Fed's liquidity program artificially inflates stock prices. However, while the promise of a continued bull market is very enticing it is important to remember, as investors, that we have only one job:  "Buy Low/Sell High."  It is a simple rule that is more often than not forgotten as "greed" replaces "logic."

Guest Post: Krugman Blowing Bubbles

Saying we need continuous financial bubbles to keep full employment is such a flawed conception of economics, it belongs on an island of misfit philosophies. Krugman’s incessant promotion of statism is doing more harm to the economy than good. As an opinion-molder, he is perpetuating the economic malaise of the last few years. More bubbles won’t help the recovery, just harm it more. In the middle of a grease fire, Krugman calls for more pig fat. And the rest of us are the ones left burnt.