Reality

"While it is human nature to think and expect along linear lines, our World just doesn’t work that way. Instead, everything moves in cycles, some short and shallow, while other cycles are long and deep. What we are experiencing today is the likely turning point in a very long cycle of borrowing, borrowing and then borrowing some more."

The "engine of our economy", the "cradle of innovation", the "land of tomorrow" -- whatever breathless hyperbole the fawning media is using this week -- is a sham. Silicon Valley has become a factory of hype, funneling gobs of early-stage capital into whatever half-credible concepts it can think of, and then pimping the artificially-inflated initial results of those tarted-up ventures to whichever "greater fool" is willing to acquire it or buy its IPO. Let that idiot figure out if it will ever turn a profit...

If we, and Bloomberg, are correct, and if the CFD unwind has only just started impacting the true supply/demand dynamics, and thus price, of copper, then we are only 30% of the way through the unwind of China's copper "carry trade" and thus the 'over-capacity' concerns are massively under-appreciated.

"You thought it was safe to drive 90 miles an hour on a rain-slicked narrow road while you were tipsy because the airbag would save you, but it still hurts when you crash." This is the Paradox of Risk: the more risk is apparently lowered, the higher the risk we are willing to accept.

Venezuela’s economy is in desperate trouble. The country is highly dependent on oil reserves and has no significant substitute for black gold in the near term. That reality makes Venezuelan President Nicolas Maduro’s recent efforts to tout the country’s technology industry laughable.

Every day, there are a set of messages broadcast to the population. These messages are projected to replace what people would think on their own, if left to their own devices. What they’re supposed to think about nuclear weapons, pesticides, medical drugs, vaccines, presidential elections, major media, the CIA, US foreign policy, mega-corporations, brain research, collectivism, surveillance, psychiatry, immigration... It seems today that the main attribute of the individual is "perceiving what is." Perceiving Reality.

No professional or successful investor every bought and held for the long-term without regard, or respect, for the risks that are undertaken. If the professionals are looking at "risk" and planning on how to protect their capital from losses when things go wrong - then why aren't you?  Exactly how many warnings do you need?

So what's left in the toolbag of central banks and states to stimulate recessionary economies if QE has been discredited? The answer: Helicopter Money.

• Playboy to Drop Nudity as Internet Fills Demand (NYT)
• Stock futures fall on weak China trade data (Reuters)
• Any Hall is down 20% YTD (WSJ)
• Global Stocks Slide With Metals After Chinese Imports Tumble (BBG)
• Clinton's tack to the left to be on display in Democratic debate (Reuters)
• Switzerland Said to Impose 5% Leverage Ratio on Big Banks (BBG)
• AB InBev, SABMiller brew up $100 billion deal (Reuters)

Major Chinese telecom supplier Fu Chang Electronic Technology Co. (also known as Fosunny), shocked its 3,800 employees when  instead of going public, the company announced it would be going dark instead when it issued a statement saying it was ceasing operations due to liquidity problems resulting from legal and debt issues.

"A U.S. official confirmed Sunday that a decision had been made to conduct such patrols but said it was unclear when that might happen or where exactly. 'It’s just a matter of time when it happens,' the official said. Another U.S. official indicated that the operation could come within days."

Don't look at their corporate bonds...

They are spending it on... gas.