Economics should not not try to effect human behavior, but to explain it. It does, however understand how incentives and disincentives affect behavior. All political visions involve the improvement of man and/or society by changing the nature of man. Social planners want to “improve” and “perfect” matters according to their ideas of what these terms imply. Little commonality exists regarding utopian visions. One commonality between these utopian ideas does exist — the universal failure of all such schemes. There is no better way to understand the wisdom “the perfect is the enemy of the good” than to study the historical wreckage that has resulted from trying to “perfect” society.
- M&A Mystery: Why Are Takeover Prices Plummeting? (WSJ)
- Hedge-Fund Fight Club Traded Illegal Tips Not Punches (BBG)
- Speed Traders Meet Nightmare on Elm Street With Nanex (BBG)
- A new wave of U.S. mortgage trouble threatens (Reuters)
- Penny Lane: Gitmo's other secret CIA facility (AP)
- US hardens threat to leave Afghanistan with no troops (WSJ)
- Russian Prison Stuns Captain of Greenpeace’s Bombed Ship (BBG)
- ECB's Weidmann Warns Central Banks Might Be Too Dominated by Fiscal Concerns (WSJ)
- China Air Move Splits Japan as Carriers Obey New Rules (BBG)
- Inside the Breakup of the Pritzker Empire (WSJ)
After a year of talks over the post-2014 US military presence in Afghanistan, the US administration announced last week that a new agreement had finally been reached. Under the deal worked out with Afghan President Hamid Karzai, the US would keep thousands of troops on nine military bases for at least the next ten years. In fact, much of the US government’s desire for an ongoing military presence in Afghanistan has to do with keeping money flowing to the military industrial complex. Addressing Afghan tribal elders last week, Karzai is reported to have expressed disappointment with US assistance thus far: “I demand tanks from them, and they give us pickup trucks, which I can get myself from Japan… I don’t trust the U.S., and the U.S. doesn’t trust me.” Let us hope that Karzai sticks to his game with Washington. Let the Obama administration have no choice but to walk away from this twelve-year nightmare. Then we can finally just march out.
"We, the German Fuhrer and Chancellor, and the British Prime Minister, have had a further meeting today and are agreed in recognizing that the question of Anglo-German relations is of the first importance for our two countries and for Europe. We regard the agreement signed last night and the Anglo-German Naval Agreement as symbolic of the desire of our two peoples never to go to war with one another again. We are resolved that the method of consultation shall be the method adopted to deal with any other questions that may concern our two countries, and we are determined to continue our efforts to remove possible sources of difference, and thus to contribute to assure the peace of Europe. My good friends, for the second time in our history, a British Prime Minister has returned from Germany bringing peace with honor. I believe it is "peace for our time." Go home and get a nice quiet sleep." - Neville Chamberlain, September 30, 1938
With 1 Week Left Until November 30 Obama Scrambles To Boost Obamacare Enrollment; Propaganda Enters Overdrive ModeSubmitted by Tyler Durden on 11/23/2013 11:12 -0500
With just a week to go until the Obama-promised "all clear" healthcare.gov date of November 30, the president is scrambling to boost enrollment in the 11th hour. As reported by Reuters, the administration announced a flurry of fixes to its troubled HealthCare.gov website on Friday that officials said would soon double its current capacity, a crucial step toward getting the system working by a November 30 deadline. It also pushed back a deadline for people to enroll in insurance plans for 2014 under President Barack Obama's Affordable Care Act in a nod to millions of applicants who have been unable to sign up because of technical glitches for nearly two months. The reason for the push is that consumers need to make decisions on healthcare plans in December if they want insurance in place by January.
Following yesterday's latest Taper Tantrum, it was critical to get a smattering of bad global overnight news to provide the ammunition for the algos that not all in the world is fine and the easy monetary policy will continue indefinitely pushing stocks ever higher at the expense of the global economy. Sure enough first China, and then Europe complied, following the biggest China Flash PMI miss and drop in 6 months, followed shortly thereafter by a miss and a drop in the Eurozone Composite PMI down from 51.9 to 51.5, below expectations of an increase to 52.0, primarily on the back of a decline in the Service PMI from 51.6 to 50.9, with 51.9 expected even as the Mfg PMI rose modestly from 51.3 to 51.5. The country breakdown showed a significant deterioration in France and an improvement in Germany. But the biggest overnight driver by a wide margin was the Yen, which tumbled nearly 100 pips and the USDJPY hit an overnight high of just over 100.90, which pushed the Nikkei up by almost 2%, and kept the futures well bid. However, what has confused algos in recent trading is the expected denial by Draghi of a negative interest rate, which while good for the EURJPY that drives the ES, what is the flipside is that this means less easing by the ECB, and thus interpreting the data does not result in a clear BTFD signal. Which may be a problem because should stocks close red today it will be the first 4 day drop in who knows how long.
At this point it is incredible that there are any Americans that still trust anything that comes out of the administration's collective mouth. And of course it is not just Obama that has been lying to us. Corruption and deception are rampant throughout the entire federal government, and this has been the case for years. Now that some light is being shed on this, hopefully the American people will respond with overwhelming outrage and disgust. Aside from the now "fake" employment data, the following are five massive economic lies that the government has been telling you... Our financial system is far more vulnerable than we are being told. We are in the terminal phase of the greatest debt bubble in the history of the planet, and when this bubble bursts it is going to be an absolutely spectacular disaster. Please don't believe the mainstream media or the politicians when they promise you that everything is going to be okay.
- JPMorgan $13 Billion Mortgage Deal Seen as Lawsuit Shield (BBG)
- J.P. Morgan Is Haunted by a 2006 Decision on Mortgages (WSJ)
- World powers, Iran in new attempt to reach nuclear deal (Reuters)
- Keystone Foes Seek to Thwart Oil Sands Exports by Rail (BBG) - mostly Warren Buffet?
- How Would Fed Deal With Debt Ceiling Crisis? Look to Minutes for Clues (Hilsenrath)
- Anything to prevent the loss of prop trading: 'Volcker Rule' Faces New Hurdles (WSJ)
- BOE Sees Case for Keeping Record-Low Rate Beyond 7% Jobless (BBG)
- Obama Backs Piecemeal Immigration Overhaul (WSJ)
- Abenomics Seen Cutting Japan Bad-Loan Costs to 2006 Low (BBG)
You may find what is happening at one Wal-Mart in Ohio very hard to believe. At the Wal-mart on Atlantic Boulevard in Canton, Ohio employees are being asked to donate food items so that other employees that cannot afford to buy Thanksgiving dinner will be able to enjoy one too. On the one hand, it is commendable that someone at that Wal-Mart is deeply concerned about the employees that are so poor that they cannot afford to buy the food that they need for Thanksgiving. On the other hand, this is a perfect example that shows how the quality of the jobs in this country has gone down the toilet.
As H.L. Mencken opined, 'The most dangerous man to any government is the man who is able to think things out for himself, without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane, and intolerable.' It is no wonder that, according to a Gallup Poll conducted in early October, a record-low 14% of Americans thought that the country was headed in the right direction, down from 30% in September. That's the biggest single-month drop in the poll since the shutdown of 1990. Some 78% think the country is on the wrong track. Simply put, Faber explains, it is most unlikely that US economic growth will surprise on the upside in the next few years. It is more likely there will be negative surprises.
The stock below is up 1200% year-to-date. The company in question is insolvent by any and all measures and has a "parent" under great pressure to take whatever gains it can get (as opposed to leave anything for shareholders). The company is exposed to the worst of the worst in the housing market. The smart money (as they are called) is piling in. The company is, of course, Fannie Mae (or Freddie Mac - same discussion). This chart, like none other, reflects the "investment" thesis in America today, as Grenwood's Walter Todd notes, “Either you’re going to make a lot of money or you’re going to lose everything you put into it."
The establishment desires to acclimate Americans to the idea that being anti-government is wrong; that it is a despicable philosophy embracing social deviance, aimless violence, isolation and zealotry. Looking beyond the mainstream position, my question is, is it really such a bad thing to be anti-government today?
UnitedHealth, the nation's largest provider of privately managed Medicare Advantage plans, has dropped thousands of doctors from its networks in recent weeks citing "substantial funding pressure from the federal government." The WSJ reports that physician groups are protesting as many elderly patients are now unsure about whether they need to switch plans to keep seeing their doctors. Doctors in at least 10 states have received termination letters, some citing "significant changes and pressures in the health-care environment." UnitedHealth said its provider networks are always changing and that it expects its Medicare Advantage network "to be 85% to 90% of its current size by the end of 2014," due to the new health law (Obamacare). More job creation?
The only way to keep the status quo from imploding is to banish common-sense.
Japan growth cut in half, Europe growth cut by more than half, but none of that matters: today it will be all about the coronation of QEeen Yellen, who testifies before the Senate Banking Committee at 10am. Not even Japanese finance minister Aso's return to outright currency intervention warnings (in addition to the BOJ's QE monetary base dilution), when he said that Japan must always be ready to send signal to markets to curb excessive and one sided FX moves and it is important that Japan has intervention as FX policy option, which sent the USDJPY back up to 100 for the first time since September 11 made much of an impact on futures trading which after surging early in the session following the release of Yellen's prepared remarks, have now "tapered" virtually all gains. Certainly, the follow up from Europe doing the same and also warning it too may engage in QE, has been lost. Which is odd considering the entire developed world is now on the verge of engaging in the most furious open monetization of virtually everything in history.