Wall Street Journal
The Wall Street Journal appears to be saving money by dispensing with journalists and using human drop boxes instead. Thus in the New York markets the “Hilsenramp” signal is already a well-known event which occurs at approximately 3pm on/during/after Fed meeting days, and is posted under the byline of “Jon Hilsenrath”. In simple packaged form it provides fast money speculators with a message from the B-Dud, otherwise known as William Dudley, President of the New York Fed, on why the Fed will back-up another run at still higher record highs. So today comes a drop box message with respect to ECB policy posted under the byline of “Brian Blackstone”.
There's not much good news for housing these days. For a little while, the Fed's suppression of interest rates juiced housing enough to distract Americans from weak job creation and stagnant real wages. Don't have a job? No problem! Just borrow against the appreciation of your house to feed your family. But Yellen's interest rate wand looks to be out of magic. The government had a pipe dream of white picket fences for everyone. But Americans can't refinance their way to wealth. Especially in the Greater Depression.
America Now Backs Al Qaeda and Nazis
"Government officials, reacting to the growing voice of conservative news outlets, especially on the internet, are angling to curtail the media’s exemption from federal election laws governing political organizations, a potentially chilling intervention that the chairman of the Federal Election Commission is vowing to fight." While the claims made by Federal Elections Committee (FEC) Chairman Lee E. Goodman are extraordinarily frightening, sometimes people with strong partisan leanings can exaggerate threats and so we have to be careful but- crucially - media, in particular the internet, must be kept free and open. The internet is what allows an individual like us, armed with only a computer and an internet connection, to reach thousands of people per day on a shoestring budget. This is a revolution in humankind and must be preserved at all costs.
If We Don’t Learn Our History … We May Very Well Blow Off Our Own Foot
Fits the pattern of gratuitous bank enrichment perfectly. But this time, the beneficiaries of the Fed are foreign banks.
It now appears the status quo is moving to destroy any last semblance of privacy with regard to your personal brokerage accounts. Yep, in the name of “stopping fraud” and the practices of unscrupulous brokers, the Financial Industry Regulatory Authority (FINRA) wants to launch a program called Cards, or the Comprehensive Automated Risk Data System. This electronic system sounds a lot like the so-called metadata the NSA is collecting on everyone’s internet usage. This “robocop” would collect a weekly “record of activity at all of the more than 4,100 brokerage firms nationwide.” For your own good of course. Oh, and yeah, to stop terrorists or something...
When it comes to the San Francisco Fed, it is best known throughout the financial community as the group of crack economists who spend millions of taxpayer funds to investigate such probing, for kindergarteners at least, topics as: is water wet, do trees make a sound when they fall in the forest, is it still worth going to college, and are hedge funds important in a crisis. Little did we know that, at least some of them, are homicidal psychopaths with suicidal tendencies. Because this is precisely what was revealed moments ago when Bloomberg reported that the chief operating officer of the Federal Housing Finance Agency and 26-year San Fran Fed veteran, Richard Hornsby, is facing a felony charge for threatening to kill the agency’s former top official, Ed DeMarco, and then kill himself.
Wall Street is back in the business of lending money at the Fed’s gifted rate of zero plus a modest 80 basis point spread - so that the fast money can buy CLO paper on 9 to 1 leverage. There is your triple shuffle. It didn’t work out last time, but that doesn’t matter because the game is obvious. After enough buying on Wall Street’s triple leverage, junk loan prices might temporarily rebound. Then the brokers will put out the call to retail: The junk loan asset class is rebounding - its time to come back. For the final shearing, that is!
The following story by David Sirota at PandoDaily is simply excellent. It zeros in on the secretive and rapidly expanding relationship between private equity firms and the public pensions that invest in them. It shows a crony capitalist love affair greased by lobbyist influence peddlers known as “placement agents”, as well as non-public agreements between PE firms and public pensions chock full of conflicts of interest, extremely high fees and underperformance. Unbelievably, in many instances the trustees of the public pensions are not allowed to know what funds the “fund of funds” invest in. This makes due diligence impossible, and in one particularly egregious example it led the Kentucky Retirement Systems to unknowingly invest in SAC Capital despite the fact it was under SEC investigation at the time.The chief villain in this article will be no stranger to readers of this site. It is Blackstone...
In the big pharma M&A scramble, TEVA has been hosting potential suitors and may become the next acquisition target.
Simply put, there are three downside risks for markets - that appear to be off the 'meme of the day' beaten track of any average investor nowadays eyeing the record highs and gloating at any bear left standing:
1) China has shifted from a monetary policy of choice to a monetary policy of necessity.
2) The Narrative of Fed Omnipotence continues to reign supreme, but now in a tightening monetary policy environment.
3) The Hollow Market is cracked open by well-intentioned but destructive regulators.
Too long to read? Attention Deficit Disorder let you down...? Read!
As tensions between all parties in Eastern Europe boil over, Chris Martenson provides a brief tour through just some of the antics surrounding the US' involvement in bringing about change (you can believe in!) in Ukraine. We raise these items to counter the usual clutter and complete lack of context being provided in the US press and to illustrate that the US is already in pretty deep and therefore unlikely to back down now. Before we move on, do you not find it at all strange that the US media, usually extremely sensitive to anti-semitism, has given the McCain and Nuland support of the Svoboda party a complete pass? I find it to be like the case of "the dog that did not bark", meaning the silence reveals a very fickle moral compass at the heart of the western press. The demonization of Putin as the bad guy here is near complete in western media. But there’s plenty of mischief all around and, as usual, the US finds itself with some pretty strange bedfellows as it seeks an outcome it likes.
China is a case of bastardized socialism on credit steroids. At the turn of century it had $1 trillion of credit market debt outstanding—-a figure which has now soared to $25 trillion. The plain fact is that no economic system can remain stable and sustainable after undergoing a 25X debt expansion in a mere 14 years.
It happened in 2000 and 2007. Spectacular consequences! Now it happened again. And beneath the blue-chip highs, parts of the market are already crashing.