en 10 Reasons Washington Has War Fever <p><a href=""><em>Submitted by Ron Holland via The Daily Bell</em></a>,</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;War is merely the continuation of policy by other means.&quot; &ndash; Carl von Clausewitz</p> </blockquote> <p>The political elites, Federal Reserve and special interests that really run the show hiding behind Congress and the president of either party in America&#39;s closed two-party monopoly <strong>seem to be running scared in many regards</strong>. They rightly have many fears for their political future as well as the profits and survival of the major international corporations and banking interests that support the current political leadership and regime.</p> <p><strong>Never has our nation, corporations and wealthy top 1% faced so many new threats to their efforts to grow their power and wealth around the world.</strong> Although there is enough blame and mistakes to go around, many of these threats can not really be blamed on our political or financial leaders but rather result from changes in the fast-paced world we live in today.</p> <p>Conspiracy theorists prefer to see the world in black and white with no gray areas and keep it simple by criticizing secret groups or powerful interests for every problem but I believe the real situation is far more complicated. But everyone should realize the free America we grew up in has been long dead and buried with only the institutions and slogans remaining to lull the dumbed down public into apathy and acceptance. Our leaders are not omnipotent and certainly do not have all the answers and I suggest they have few answers and are actually making everything up as they go along, hence why I fear they will ultimately choose war as a solution to their problems.</p> <p><strong>Our America Does Not Exist Any More</strong></p> <p>Of course, conspiracies exist and thanks to Edward Snowden&#39;s publicity, America does indeed operate a global police state with intelligence gathering, torture and spying everywhere in the world. While I believe this effort is more directed toward controlling foreign and domestic politicians and powerful individuals than targeting helpless Americans who disagree with policies, this is a frightening situation for what once was the symbol of freedom and liberty for the entire world.</p> <p>But as Dorothy told her dog, Toto, in the classic &quot;Wizard of Oz&quot; movie, &quot;I&#39;ve a feeling we&#39;re not in Kansas anymore,&quot; we&#39;re also not in the America of our Founding Fathers any more, either. Real capitalism and free markets simply do not exist any longer. A few powerful interests manipulate all markets, unlimited fiat money is a profitable franchise and we are attempting to police and control the entire world to maintain our leadership position held since the end of World War Two.</p> <p>Today you are a fool to trust what the government or press claims is true, fair and balanced, as it&#39;s all just propaganda. Regulatory organizations exist only to protect the favored industries not the public, our legal system is a joke and all wars fought for democracy against evil are just looting expeditions against other nations out for profits, gain and natural resources.</p> <p>All governments issue propaganda and mainstream news organizations sell the secret agendas and policies to the people. But the world today and especially the United States faces new challenges not even war-gamed or focus-grouped a few years ago and here lies the problem and risks for the nation and citizenry.</p> <p><strong>War May Be the Only Solution Left For Our Political Elites To Survive &amp; Prosper</strong></p> <p>As Clausewitz so clearly stated, &quot;War is merely the continuation of policy by other means,&quot; and our leadership and the special interests behind them want to continue the policies and actions that have created so much wealth and world power for them. Think for a moment about the threats they are facing at home and abroad and how a major but limited war could solve or postpone most of their problems and threats to their powerbase.</p> <p>There are two problems with the war solution. First, while it may be in their best interest to guarantee their survival, war would be bad for our military, soldiers and civilians as well as our economy, private wealth and remaining liberties. Second, there is no guarantee that a real war once started would remain limited in nature. I think both world wars are historical examples of how plans for limited wars can turn into major wars killing tens of millions and all of this for power hungry politicians and vested economic interests. Remember this classic quote about war:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;No battle plan survives contact with the enemy.&quot;</p> <p>&nbsp;</p> <p>&ndash; Helmuth von Moltke, German military strategist</p> </blockquote> <p><strong>Wars Are Easy To Start and Rally Patriotism But Are Difficult to End</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;Naturally the common people don&#39;t want war: Neither in Russia, nor in England, nor for that matter in Germany. That is understood. But, after all, IT IS THE LEADERS of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is TELL THEM THEY ARE BEING ATTACKED, and denounce the peacemakers for lack of patriotism and exposing the country to danger. IT WORKS THE SAME IN ANY COUNTRY.&quot;</p> <p>&nbsp;</p> <p>&ndash; Hermann Goering at the Nuremberg Trials</p> </blockquote> <p>1. Wars can provide a crisis and justification to continue sovereign debt issuance and currency expansion for the duration of the conflict.</p> <p>2. War would allow the politicians to blame Russia and China for the coming end to the dollar as the world reserve currency as well as the looming dollar and debt crisis.</p> <p>3. The Federal Reserve and their global central banking cartel have really destroyed the economy of the West through excessive debt issuance, money creation and borrowing. A war would allow the blame to be transferred to the enemy nations for public consumption.</p> <p>4. War would allow the US to regain control over the European Union, individual European nations and NATO. Today, Germany, France and other nations are wavering in the lockstep support for US policies and war plans in the Ukraine.</p> <p>5. War would stifle secession movements in Spain and Scotland, Greece and Italy threats to withdraw from the EU and the common euro currency.</p> <p>6. A war would provide the excuse for the US to reestablish elite control over news and opinion from foreign news organizations and alternative Internet news competition.</p> <p>7. A war against Russia and Iran would safeguard competition from Russian and Iranian oil and gas delivery pipelines as well as allow us to control Middle East production and continue the Petrodollar system for years to come.</p> <p>8. As in both world wars, a major war would allow the government to terminate all domestic political movements and adversaries except for &quot;approved&quot; controlled opposition candidates from the two major parties.</p> <p>9. A successful war against allies of China would delay the global power challenge from a resurgent China for a few years.</p> <p>10. Finally, during a wartime crisis situation, politicians can always get away with attacks on civil liberties, freedom of the press and wealth confiscation to a degree never possible during peacetime and here lies the ultimate war threat to the majority of the American people. The much hyped and often undercover agent driven fake terror plots designed to keep the citizens living in fear and willing to give up liberties for safety simply does not work any longer now 14 years after 9/11.</p> <p>*&nbsp; *&nbsp; *</p> <p><strong>But a real war would provide the crisis excuse to confiscate your gold and &quot;excess&quot; retirement plan and IRA assets, reduce or curtail your social security benefits, dramatically raise taxes and institute total exchange controls while curtailing your remaining freedoms and ability to resist for the duration of the crisis.</strong>&nbsp;I&#39;ll be speaking on wars, conflicts and why you should have a safe haven residence at the upcoming&nbsp;<a href="">High Alert Investment Management Conference</a>&nbsp;in May.</p> <p><u><strong>I hope I&#39;m wrong about war becoming the solution of choice for Washington&#39;s many mistakes and shortcomings.</strong></u> Watch what happens in Syria, Iraq and the Ukraine over the next year and we will likely have the answer. But one of our founding fathers certainly knew better than to allow war or a war crisis to override good leadership and common sense.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;They that would give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.&quot; - Benjamin Franklin</p> </blockquote> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="580" height="335" alt="" src="" /> </div> </div> </div> China European Union Federal Reserve France Germany Greece Iran Iraq Italy Middle East Reserve Currency Sovereign Debt Ukraine Sat, 28 Feb 2015 03:05:34 +0000 Tyler Durden 502640 at MeeT JoHNNY JiHaD... <p style="text-align: center;"><iframe src="" width="1024" height="640" frameborder="0"></iframe></p> Sat, 28 Feb 2015 02:52:11 +0000 williambanzai7 502641 at The Net Neutrality Debate Proves The Opinions Are Far From Informed <p><a href=""><em>Via Mark St.Cyr</em></a>,</p> <p>As many of you know the FCC approved what is now considered the <strong>greatest change in the fundamental underpinnings of how the internet will be both used as well as &ldquo;allowed&rdquo; to be used</strong>. The regulation now known as Net Neutrality will supposedly make the internet more &ldquo;fair&rdquo; or &ldquo;equal&rdquo; to everyone. All I&rsquo;ll ask you to ponder is this: How&rsquo;s your cable bill working out for you?</p> <p>There&rsquo;s a lot of known and unknowns still to be had as we sit here today. Why? Regardless of what you&rsquo;ve heard or seen written in the press about this regulation;<strong> no one, and I do mean, no one knows the details to this new and sweeping regulation.</strong></p> <p>The reported 330-ish paged regulation was held in a way resembling sealed documents from a court case. The only people who read it are those that wrote it, and voted it into law. We now have to wait and see just how much everything changes.</p> <p><strong>Every future or current business, entrepreneur, as well as individual that accesses the web will be effected.</strong> Along with what everyone now&nbsp;takes for granted about the internet will also be changed.&nbsp;How much if any will remain the same, or even possible going forward no one yet knows. And that&rsquo;s not hyperbole. Everything that one thought they knew or even assumed has now changed. Period.</p> <p><strong>What took my breath away was just how many bought into the premise that all this was about (as in solely ) was not allowing ISP or cable providers to throttle content. </strong>i.e., Not allow a cable provider to charge more to a content provider for faster access to deliver their content and nothing more. And that regulating the internet would now fix this issue.</p> <p>The discussions and buttressing of arguments based on examples using monopolies and utilities by those pushing for it showed just how ill-informed many of the so-called &ldquo;experts&rdquo; were.</p> <p><strong>Just how little knowledge people have in their fundamental understanding of the differences between a real monopoly and a business impediment was just shocking. </strong>Although I shouldn&rsquo;t have been so surprised. After all, this was Silicon Valley where unicorns and rainbows still are accepted business plans for a round of VC funding. (but that window is closing far faster than many realize)</p> <p>Let me use an example to help illustrate. It&rsquo;s meant to be over simplistic however, it&rsquo;s far more instructive (in my opinion) than anything I&rsquo;ve heard from those who are so-called &ldquo;experts.&rdquo;</p> <p>Regardless of what you may think about your cable company or internet provider (and trust me I have no love for mine) the real issue in the end is what is known as &ldquo;the last mile.&rdquo; In other words the underlying issue of speed controls is in direct proportion to the ability for data to pass through efficiently in about the last mile to your home or computer. In other words the issue is basically from the pole to your house. Not from the provider to &ldquo;the pole.&rdquo; Again this is an oversimplification so please spare me the emails.</p> <p>The issue that was becoming relevant to where both sides of the content providers along with the customers found themselves was the bottleneck effect happening at the customer&rsquo;s home. i.e., within that last mile.</p> <p>There&rsquo;s only one way to resolve that issue. One and only one: You must build out the infrastructure to accommodate. And that requires money. Big money. The only question is who pays? You? The cable or ISP provider? Or the content creator. i.e., Netflix&trade; and others.</p> <p>Currently the &ldquo;individual&rdquo; paying is irrelevant for this argument. No one would solely pay the exorbitant amount of money it would cost on an individual level. That would come later in a collective form of billing such as &ldquo;service fees&rdquo; of some sort down the road. So it&rsquo;s left between the providers.</p> <p><strong>Contrary to what many are touting, a resolution (a private one as in a business to business decision and agreement) was being worked out. i.e., Netflix and others were in fact sitting down, working out monetary agreements and other particulars as to help remedy many current issues. The real issue was: It wasn&rsquo;t what &ldquo;issue politics&rdquo; wanted. And wanted &ndash; &ldquo;Right now!&rdquo;</strong></p> <p>Think about it this way. The electricity coming into your home works generally the same way. And this was used by many as an&nbsp;underpinning of their argument to express the &ldquo;utility&rdquo; equivalency discussion. Personally I thought it was the exact argument to show just how little many understood rather than solidify it.</p> <p><strong>If you want more power into your home guess what? You have to pay for the infrastructure not only at your home (e.g. update your wiring and more) but you also might need to pay for the build out from the pole. If you want or need 3 phase power? You&rsquo;re going to need to spend money. A lot of money. The power is there but if you want it, you&rsquo;re going to need to pay.</strong></p> <p>The infrastructure to carry what you currently have you paid for when the home was built. The electric company didn&rsquo;t pay, the home builder paid when the home was first constructed. If you want more power? You are going to pay. And here&rsquo;s where this issue really strike home to the &ldquo;utility&rdquo; issue used by so many.</p> <p><strong>If you don&rsquo;t like the power companies fees, service, regulations et al. Tough. Because you can&rsquo;t go around them.</strong> You can&rsquo;t build your own better, more customer friendly or compliant power company. They have a true monopoly. And no matter what you say or do, you are going to pay if it&rsquo;s decided by the regulating authorities, that no matter what &ndash; you are going to pay.</p> <p>Think not? You can go &ldquo;off grid&rdquo; you say? You&rsquo;ll find a way to &ldquo;hack.&rdquo; Not so fast. There are reports nationwide where it is illegal to disconnect your home from the &ldquo;power&rdquo; companies. Many are finding themselves facing both criminal as well as monetary charges for trying to &ldquo;disconnect.&rdquo; Your cable bill (or broadband) is going to fall into this category in coming years. After all, if it&rsquo;s now deemed as &ldquo;utility&rdquo; status why not? Think it&rsquo;s just the electricity? How about another &ldquo;utility?&rdquo;</p> <p>Try telling many city governments that you just spent $25,000 to update your septic system to a new state of the art standard so you don&rsquo;t need to connect to the cities new and improved or proposed &nbsp;sewer system. Ask them why you need to pay for some &ldquo;special assessment&rdquo; bill of a few thousand dollars payable in 30 days along with receiving a monthly bill for something you don&rsquo;t need or use?</p> <p>The response will be: &ldquo;Sorry, I just work here. Please pay the bill and make sure your property is accessible for the digging crews to connect your property. Have a nice day.&rdquo;&nbsp;And that&rsquo;s just the start. Welcome to the world of &ldquo;utility.&rdquo; and &ldquo;monopoly.&rdquo; Careful what you wish for &ndash; you just might get it!</p> <p>If you think those in the industry as in &ldquo;Silicon Valley&rdquo; have more of an understanding that you or I do. All I&rsquo;ll do is point you to the most recent as well as instructive or insightful understandings on this issue by one of net neutrality&rsquo;s foremost cheerleaders.</p> <p>I suggest you watch this short exchange that <a href="" title="link to interview">took place on CNBC&trade;</a>&nbsp;&nbsp;as to why this must take place and why its necessary for the good of the internet. Then ask yourself this question: <strong>The internet just moved from anything you knew it to be, into something no one has any understanding or clue as to what it will morph into from here. </strong>All based on a movement propelled on the understandings and insights professed by so-called &ldquo;experts&rdquo; as those in this video.</p> <p><strong>Personally I am stunned on just how little of an understanding of business those in Silicon Valley have.&nbsp;</strong>Yet maybe I shouldn&rsquo;t be. For there is no where else a business can be worth billions in market cap that either can&rsquo;t turn a profit, or better yet, can&rsquo;t keep a customer if they so dare as to charge a penny.</p> <p><strong>But that&rsquo;s now all about to change too.</strong> Because once new &ldquo;regulation&rdquo; concerns become part of the mix Wall Street has to think about when deciding who, what, or where will the hot money (if there&rsquo;s any left) will flow: Silicon Valley is going to find itself with not as much love as they once garnered. For nothing snuffs out the spark of VC free money for &ldquo;hacking&rdquo; or lets say &ldquo;Innovation&rdquo; like the threat and over arching hand &ndash; of regulation. Welcome to the land of utilities. Hope you like the new neighborhood.</p> <p>Forget about the once &ldquo;wild west&rdquo; of hackers. That&rsquo;s just been handed its death knell by their own hands. For one thing that&rsquo;s far mightier than a coders hack is a government bodies decree of regulation.&nbsp;There&rsquo;s no neutrality nor nothing &ldquo;free&rdquo; once you allow and call for the interjection and oversight of both the government along with its enforceable hand of law via regulations.</p> <p><strong>Just wait until all the details become known as well as imposed. I have a feeling net neutrality is going to feel a whole lot more like &ldquo;net injustice&rdquo; than anyone dared contemplate. Let alone imagined</strong></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="344" height="293" alt="" src="" /> </div> </div> </div> Free Money Sat, 28 Feb 2015 02:45:56 +0000 Tyler Durden 502625 at Self-Aware? World's Largest Hedge Fund Shifts Strategy To Artificial Intelligence <p>Despite warnings from the likes of Elon Musk and Stephen Hawking (and of course, Sarah Connor),<strong> Ray Dalio's $165 billion AUM hedge fund Bridgewater will start a new, artificial-intelligence unit next month</strong>. Despite the "new normal"'s total reversal of any and every historical rational trading pattern, the unit will attempt to create trading algorithms that make predictions based on historical data and statistical probabilities, as <strong><em>"machine learning is the new wave of investing for the next 20 years and the smart players are focusing on it."</em></strong> Does this mean the talking heads of CNBC, with their 'memes', 'myths', and 'mumbling' rationales for it always being a good time to buy are now obsolete? Or did the market just become self-aware?</p> <p>&nbsp;</p> <p><a href="">As Bloomberg reports,</a>The world’s largest hedge fund manager is banking on machines...</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Ray Dalio’s $165 billion Bridgewater Associates will start a new, artificial-intelligence unit next month with about half a dozen people,</strong> according to a person with knowledge of the matter. The team will report to David Ferrucci, who joined Bridgewater at the end of 2012 after leading the International Business Machines Corp. <strong>engineers that developed Watson</strong>, the computer that beat human players on the television quiz show “Jeopardy!”</p> <p>&nbsp;</p> <p><strong>The unit will create trading algorithms that make predictions based on historical data and statistical probabilities,</strong> said the person, who asked not to be identified because the information is private. The programs will learn as markets change and adapt to new information, as opposed to those that follow static instructions. A spokeswoman for Westport, Connecticut-based Bridgewater declined to comment on the team.</p> <p>&nbsp;</p> <p>...</p> <p>&nbsp;</p> <p><strong>“Machine learning is the new wave of investing for the next 20 years and the smart players are focusing on it,” </strong>Dolfino said.</p> <p>&nbsp;</p> <p>Some data scientists have been leaving firms outside of finance for larger paychecks at hedge funds, according to Dolfino.<strong> Quantitative firms have been on a winning streak and last year produced some of the highest returns in the $2.8 trillion hedge fund industry,</strong> by capturing price discrepancies across markets, making money from a plunge in oil prices and by purchasing government bonds that human traders dismissed.</p> </blockquote> <p>*&nbsp; *&nbsp; *</p> <p>Is it just us or does it seem that everyone has forgotten the flash-crash and the quant crash before that when all the machines chased down the same rabbit holes?</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="560" height="395" alt="" src="" /> </div> </div> </div> Bridgewater New Normal Sat, 28 Feb 2015 02:30:01 +0000 Tyler Durden 502637 at China And The Dragon Tail Of Marx <p><a href=""><em>Submitted by Charles Hugh-Smith of OfTwoMinds blog</em></a>,</p> <p><span><i>The dragon tail of Marx&#39;s end-game of overcapacity and finance capital is about to shred China&#39;s fantasy that the state can micro-manage both capitalism and financialization with no contradictions or consequences.</i></span></p> <div>&nbsp;</div> <div><span><b>Longtime readers know my one expertise is annoying the entire ideological spectrum in 1,000 words or less.</b>&nbsp;Today is one of those days, so strap on your blood pressure monitor and prepare for full-spectrum annoyance, regardless of your ideological leanings.</span></div> <div>&nbsp;</div> <div> <div><span><b>Marxism is typically considered discredited outside of a few protected fiefdoms of academia</b>&nbsp;which tend to engage in obscure debates over the labor theory of value and other signifiers of&nbsp;<i>membership in the inner circle of deep Marxist thinkers</i>.</span></div> <div>&nbsp;</div> <div><span>Outside these cloistered academic circles, Marxism is dismissed for two basic reasons:</span></div> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><div><span>1. the predicted final crisis and implosion of capitalism did not occur</span></div> <div>&nbsp;</div> <div><span>2. the vaguely outlined post-capitalist incarnation of a stateless worker&#39;s paradise not only failed to materialize, but was used to justify destructive, murderous totalitarian regimes.</span></div> </blockquote> <div><span><b>But those egregious failures of Marxist theory should not blind us to the value of his critique of capitalism.</b>&nbsp;After all, he was writing in the first stages of industrialization and global finance (late 19th century), and his failure to detail a&nbsp;<i>scientific socialism</i>&nbsp;beyond capitalism can be chalked up to a mix of naive idealism and a paucity of theoretical models to build on.</span></div> <div>&nbsp;</div> <div><span><b>Ironically, the one successful state that claims to be founded on Marxist principles, China, is poised to prove his analysis of capitalism&#39;s implosion was fundamentally sound.</b>&nbsp;Consider two major parts of Marx&#39;s analysis of capitalism:</span></div> <div>&nbsp;</div> <div><span>1. the consequences of overcapacity and competition</span></div> <div>&nbsp;</div> <div><span>2. the dominance of&nbsp;<i>finance capital</i>&nbsp;over&nbsp;<i>industrial capital</i></span></div> <div>&nbsp;</div> <div><span><b>Marx foresaw that the consequence of overcapacity and competition is the collapse of profits which leads to the collapse of wages and most competitors.</b>&nbsp;If there is any single word that defines China now, it&#39;s&nbsp;<i>overcapacity</i>.</span></div> <div>&nbsp;</div> <div><span>This is not a new dynamic; when I first visited China in 2000, the TV set industry was already suffering from overcapacity/overproduction and a resultant collapse of profits.</span></div> <div>&nbsp;</div> <div><span><b>What can any enterprise do when competition and overcapacity slash profit margins to near-zero? Slash payrolls and wages.</b>&nbsp;Profit margins are famously razor-thin in most Chinese industries, and despite wages that are a fraction of U.S./E.U. wages, automation of production lines is the only solution to Chinese companies beset by fierce competition and overcapacity in their sector.</span></div> <div>&nbsp;</div> <div><span>Automation only provides a brief competitive advantage, as one&#39;s competitors are busy lowering their input costs by automating production.</span></div> <div>&nbsp;</div> <div><span><b>Marx understood that the end-game of overcapacity is a reduction of capacity via bankruptcy and the establishment of competition-killing monopolies.</b>&nbsp;This is the stage of collapse that lies just ahead for the majority of Chinese industrial players.</span></div> <div>&nbsp;</div> <div><span><b>The equally devastating parallel implosion of factory jobs will crush demand.</b>&nbsp;The social safety net in China is threadbare compared to the West; laid off workers get little compensation or retraining; most face a return to rural villages and subsistence incomes from farm work that have dwindled to a few hundred dollars a year as a result of state policies that have made food cheaper for poor urban workers.</span></div> <div>&nbsp;</div> <div><span><b>If there is any major economy that demonstrates the dominance of&nbsp;<i>finance capital&nbsp;</i>over&nbsp;<i>industrial capital</i>, it&#39;s China.</b>&nbsp;The entire boom since the global financial meltdown in 2008 has been financed by cheap credit, leverage and speculative lending in an opaque shadow banking sector.</span></div> <div>&nbsp;</div> <div><b><span>Compare China&#39;s bank assets with those of the U.S., which has an economy of roughly the same size:</span></b></div> <div>&nbsp;</div> <div><span><img align="middle" border="0" src="" /></span></div> <div>&nbsp;</div> <div><span>It doesn&#39;t matter whether the banks are owned by the state or not; the net result is the same: massive malinvestment as productive investment is abandoned in favor of speculation.</span></div> <div>&nbsp;</div> <div><span><b>If any nation is poised to reap the consequences of rampant financialization, it&#39;s China.&nbsp;</b>In the global downturn that&#39;s just starting, China won&#39;t be able to boost capacity as a solution--the economy is already being crushed by overcapacity in virtually every sector.</span></div> <div>&nbsp;</div> <div><span>It also can&#39;t turn to the&nbsp;<i>financialization save</i>&nbsp;of unlimited expansion of credit and dodgy leverage--financialization has already been pushed to the redline. there is nothing left except&nbsp;<i>diminishing returns on additional expansions of credit and leverage</i>.</span></div> <div>&nbsp;</div> <div><span><b>Marx is about to demolish the fantasy in China that financialization can be controlled by the state.</b>&nbsp;Losses can be covered over and the next expansion of credit is just around the corner. Nice, but credit doesn&#39;t create jobs lost to overproduction, nor does it generate profits, nor does it generate collateral for the next round of shadow banking speculation.</span></div> <div>&nbsp;</div> <div><span><b>What Marx did not foresee is the critical role of the state in enforcing private monopolies and the predations of financialization.</b>&nbsp;While Marx understood the parasitic nature of Monopoly Capitalism, he did not anticipate the State&#39;s partnering with Cartel/Crony Capitalism. In effect, the Chinese State is now so dependent on financialization that it stripmines the citizenry to protect the financial sector from the consequences of their&nbsp;<i>business model</i>&nbsp;(excessive credit, leverage, fraud, embezzlement and the misrepresentation of risk). But the Chinese State doesn&#39;t merely enable the predation of its crony financiers; it also stripmines the citizenry to fund its own expansion into every nook and cranny of civil society.</span></div> <div>&nbsp;</div> <div><span><b>The dragon tail of Marx&#39;s end-game of overcapacity and finance capital is about to shred China&#39;s fantasy that the state can micro-manage both capitalism and financialization with no contradictions or consequences.</b>&nbsp;&quot;Dragon Seeks path. Dragon whips his tail.&quot; The dragon of capitalism isn&#39;t as easy to control as bureaucrats expect. </span></div> </div> <p>&nbsp;</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="398" height="320" alt="" src="" /> </div> </div> </div> China Meltdown Shadow Banking Sat, 28 Feb 2015 01:55:23 +0000 Tyler Durden 502639 at In "Paranormal" Europe, Banks Will Pay You To Borrow, And Charge You To Save <p>A month ago, we wrote about a bizarre situation involving Denmark's now totally broken monetary system, where as a result of an unprecedented scramble to weaken the currency in order to preserve the peg to the Euro the central bank unleashed a historic rate-cutting scramble, where in 4 consecutive rate cuts its pushed the interest rate to an unheard of -0.75% (while at the same time being the first modern central bank to unveil what we dubbed "<a href="">Bizarro Backdoor QE</a>"). The culmination of this series of events was the surreal realization by some debtors that the bank would now <strong>pay them the interest on their new or existing mortgage</strong>. </p> <p>The insanity was only compounded when one considers that in the vast majority of European countries, depositors are already (or will soon) pay for the "privilege" of providing banks with unsecured funds (in the US, <a href="">JPM recently also started charging some customers </a>- mostly corporate and hedge funds- for holding their deposits).</p> <p>In short, this is what Europe has become: <strong>savers </strong>- those who diligently put away the fruits of their labor - are now <em><strong>forced </strong></em>to pay, using banks as an intermediary, and subsidize the the debtor: spenders, who live beyond their means, and who in increasingly more frequent situations are now <em><strong>paid to take out even more debt</strong></em>! Call it monetary socialism. </p> <p>Which is probably why with a one month delay, none other than the NYT decided to cover precisely this topic with "<a href=";_r=0">In Europe, Bond Yields and Interest Rates Go Through the Looking Glass</a>"</p> <p>Here is the story in a nutshell, shown with pictures so even central bank idiots and other economist PhDs will get it:</p> <p><strong><span class="caption-text">A Denmark bank will pay Eva Christiansen, left, $1 a month for taking out a loan. Ida Mottelson's bank will charge her to hold her money:</span></strong></p> <p><a href=""><img src="" width="600" height="400" /></a></p> <p><span class="caption-text">The key highlights from the NYT story:</span></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><span class="caption-text">At first, Eva Christiansen barely noticed the number. Her bank called to say that Ms. Christiansen, a 36-year-old entrepreneur here, had been approved for a small business loan. She whooped. She danced. A friend took pictures. </span></p> <p>&nbsp;</p> <p><span class="caption-text"><strong>“I think I was so happy I got the loan, I didn’t hear everything he said,” </strong>she recalled. </span></p> <p>&nbsp;</p> <p><span class="caption-text">And then she was told again about her interest rate. <strong>It was -0.0172 percent — less than zero. While there would be fees to pay, the bank would also pay interest to her.</strong> <br /></span></p> <p>&nbsp;</p> <p><span class="caption-text">* * * </span></p> <p>... some corporate bonds, which are generally deemed less creditworthy than government bonds, are falling into the negative territory, including some issued by Nestlé and Novartis, a Swiss pharmaceutical company. While they did not initially have negative yields, investors bid up their prices after they were issued. “This is obviously a once-in-a-lifetime and once-in-history phenomenon,” said Heather L. Loomis, a managing director at JPMorgan Private Bank, who specializes in bonds, “and it is hard to make sense of it.” </p> <p>&nbsp;</p> <p>Ms. Christiansen, a sex therapist, took out a loan to finance a website called LoveShack that is part matchmaking site, part social network. For her, the full novelty of her loan didn’t sink in until a spokeswoman for the bank called her back. </p> <p>&nbsp;</p> <p>“She said, ‘Hi, Eva, they have contacted us from TV 2’ — it’s a big station in Denmark, one of the biggest — ‘and they would like to talk to you because of this loan,’” Ms. Christiansen said. “Then I was really like, ‘O.K., this is big.’” </p> <p>&nbsp;</p> <p>She said she was generally aware of what the Danish central bank was doing, but fuzzy on the specifics and had not paid close attention to the issue until she realized she might be asked about it in front of a camera. </p> <p>&nbsp;</p> <p>“When I was contacted by the television, I was like, ‘O.K., I need to know something,’” she said, laughing, during an interview at her office, where two distant windmills were visible outside the windows. “So I actually called my bank adviser and said, ‘Can we please have a meeting?’ Because all these financial terms, I’m not used to them,” she said. “If I talk about something, I’d like to know something about it.”</p> <p>&nbsp;</p> <p><span class="caption-text">* * *<br /></span></p> <p>Some other Danes are facing a related, if somewhat opposite, issue. </p> <p>&nbsp;</p> <p>Last month, Ida Mottelson, a 27-year-old student, received an email from her bank telling her that it would start charging her one-half of 1 percent to hold her money. <strong>“At first I thought I had misunderstood this, but I hadn’t,” </strong>she said.</p> <p>&nbsp;</p> <p>Ms. Mottelson is studying for a master’s degree in health sciences, and lives in Odense, a city about 100 miles west of Copenhagen. She said she had been following the news about the central bank, but called her own bank just to make sure she was reading the email correctly.</p> <p>&nbsp;</p> <p>“I asked him supernaïvely, ‘Can you explain this to me?’ And he tried, but I got the feeling he was like, come on, just move the money and you’ll be fine.”</p> <p>&nbsp;</p> <p>She does plan to move her money to another bank. <strong>“I’m not an expert,” Ms. Mottelson said, “<span style="text-decoration: underline;">but to me it sounds so weird that you have to pay to have your account at a bank</span>.”</strong></p> </blockquote> <p>You are right, Ms. Mottelson: it is. And it will only get much weirder from here. Because we have now gotten so far past the looking glass into a world in which the central banks have broken every correlation and logical relationship so profoundly, that nothing makes sense any more; whoever, before the now inevitable grand reset when everything finally collapses under the unsustainable weight of the global house of cards, things will only going get even stranger.</p> <p>And while we have been lamenting all of this years in advance, all of which we predicted would <a href="">happen back in June 2012</a>, we are delighted that even the mainstream media has once again, with the usual two to three year delay, caught up with what Zero Hedge readers knew long, long ago.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>These are strange times for European borrowers, as if a wormhole has opened up to a parallel universe where the usual rules of financial gravity are suspended. </strong>Investors lent Germany nearly $4 billion this week, knowing they would not be fully repaid. Bonds issued by the Swiss candy maker Nestlé recently traded in the market for more than they will ever be worth. </p> <p>&nbsp;</p> <p><strong>Consumers loans and mortgages with interest rates that are outright negative remain rare, and Ms. Christiansen appears to be one of the few who actually received one while banks mull how to proceed. Some other Danes are getting charged to park their money in their bank accounts.</strong></p> <p>&nbsp;</p> <p>* * * </p> <p>&nbsp;</p> <p><strong>Such paranormal financial episodes are taking place all across Europe.</strong></p> </blockquote> <p>Indeed, call it the new "paranormal", and thank the central-planners for bringing the world to the edge, and beyond, of reason, where nothing makes sense any more. But don't worry, because this time it's different, and there will be a happy ending for everyone involved...</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="400" height="300" alt="" src="" /> </div> </div> </div> Bond Central Banks Copenhagen Germany None Sat, 28 Feb 2015 01:20:57 +0000 Tyler Durden 502638 at The Forgotten War – Understanding The Incredible Debacle Left Behind By NATO In Libya <p><a href=""><em>Submitted by Mike Krieger via Liberty Blitzkrieg blog</em></a>,</p> <p><a href=""><img height="223" src="" width="377" /></a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong><em>In retrospect, Obama&rsquo;s intervention in Libya was an abject failure, judged even by its own standards. Libya has not only failed to evolve into a democracy; it has devolved into a failed state. Violent deaths and other human rights abuses have increased severalfold. Rather than helping the United States combat terrorism, as Qaddafi did during his last decade in power, Libya now serves as a safe haven for militias affiliated with both al Qaeda and the Islamic State of Iraq and al-Sham (ISIS). The Libya intervention has harmed other U.S. interests as well: undermining nuclear nonproliferation, chilling Russian cooperation at the UN, and fueling Syria&rsquo;s civil war.?</em></strong></p> <p>&nbsp;</p> <p><strong><em>As bad as Libya&rsquo;s human rights situation was under Qaddafi, it has gotten worse since NATO ousted him. Immediately after taking power, the rebels perpetrated scores of reprisal killings, in addition to torturing, beating, and arbitrarily detaining thousands of suspected Qaddafi supporters. The rebels also expelled 30,000 mostly black residents from the town of Tawergha and burned or looted their homes and shops, on the grounds that some of them supposedly had been mercenaries. Six months after the war, Human Rights Watch declared that the abuses &ldquo;appear to be so widespread and systematic that they may amount to crimes against humanity.&rdquo;?</em></strong></p> <p>&nbsp;</p> <p><strong><em>As a consequence of such pervasive violence, the UN estimates that roughly 400,000 Libyans have fled their homes, a quarter of whom have left the country altogether. ?</em></strong></p> <p>&nbsp;</p> <p>&ndash; From Alan Kuperman&rsquo;s excellent&nbsp;<em>Foreign Affairs</em> article:&nbsp;<a href="">Obama&rsquo;s Libya Debacle</a></p> </blockquote> <p>Regular readers will be somewhat familiar with the total chaos NATO left behind in the wake of&nbsp;its so-called &ldquo;humanitarian&rdquo; intervention in&nbsp;Libya, but I doubt many of you are aware of just how enormous the disaster actually has become.</p> <p><span class="caps">Alan J. Kuperman,&nbsp;</span>an Associate Professor at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin, wrote an incredible article in the latest issue of <em>Foreign Affairs, </em>which is an absolute must read. If the American public and politicians actually wanted to learn from their&nbsp;mistakes and avoid making them in the future, this piece could serve as a comprehensive warning about what not to do.</p> <p>That said, after reading this article the unfortunate truth becomes apparent;&nbsp;that there are only two logical conclusions that&nbsp;can be reached about American foreign policy leadership in the 21st century.</p> <p><em><strong>1) American leadership is ruthlessly pursuing immoral wars all over the world with the intent of creating outside enemies to focus public anger on, as a&nbsp;conscious diversion away&nbsp;from the criminality happening domestically. As an added bonus, the intelligence-military-industrial complex makes an incredible sum of money. The end result: serfs are distracted with inane nationalistic fervor, while the &ldquo;elites&rdquo;&nbsp;earn&nbsp;billions.</strong></em></p> <p><strong><em>2) American leadership is completely and totally inept; being easily manipulated into overseas conflicts by ruthless&nbsp;corporate interests and cunning foreign &ldquo;rebels&rdquo; in order to advance their own selfish interests, which are in conflict with the interests of the general public.</em></strong></p> <p>I can&rsquo;t come up with any other logical conclusion. Either way, such&nbsp;people have no business running the affairs of these United States, and their actions are merely increasing&nbsp;instability and violence across the planet. <strong>The longer they remain in charge with no accountability, the more dangerous this world will become.</strong></p> <p>From<a href=""><em> Foreign Affairs</em></a>:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>In March 17, 2011, the UN Security Council passed Resolution 1973, spearheaded by the administration of U.S. President Barack Obama, authorizing military intervention in Libya. The goal, Obama explained, was to save the lives of peaceful, pro-democracy protesters who found themselves the target of a crackdown by Libyan dictator Muammar al-Qaddafi. Not only did Qaddafi endanger the momentum of the nascent Arab Spring, which had recently swept away authoritarian regimes in Tunisia and Egypt, but he also was poised to commit a bloodbath in the Libyan city where the uprising had started, said the president. </em></p> <p>&nbsp;</p> <p><em>&ldquo;We knew that if we waited one more day, Benghazi&mdash;a city nearly the size of Charlotte&mdash;could suffer a massacre that would have reverberated across the region and stained the conscience of the world,&rdquo; Obama declared. Two days after the UN authorization, the United States and other NATO countries established a no-fly zone throughout Libya and started bombing Qaddafi&rsquo;s forces. Seven months later, in October 2011, after an extended military campaign with sustained Western support, rebel forces conquered the country and shot Qaddafi dead.</em></p> <p>&nbsp;</p> <p><em>In the immediate wake of the military victory, U.S. officials were triumphant. Writing in these pages in 2012, Ivo Daalder, then the U.S. permanent representative to NATO, and James Stavridis, then supreme allied commander of Europe, declared, &ldquo;NATO&rsquo;s operation in Libya has rightly been hailed as a model intervention.&rdquo; In the Rose Garden after Qaddafi&rsquo;s death, Obama himself crowed, &ldquo;Without putting a single U.S. service member on the ground, we achieved our objectives.&rdquo; Indeed, the United States seemed to have scored a hat trick: nurturing the Arab Spring, averting a Rwanda-like genocide, and eliminating Libya as a potential source of terrorism. ?</em></p> <p>&nbsp;</p> <p><em>That verdict, however, turns out to have been premature. In retrospect, Obama&rsquo;s intervention in Libya was an abject failure, judged even by its own standards. Libya has not only failed to evolve into a democracy; it has devolved into a failed state. Violent deaths and other human rights abuses have increased severalfold. Rather than helping the United States combat terrorism, as Qaddafi did during his last decade in power, Libya now serves as a safe haven for militias affiliated with both al Qaeda and the Islamic State of Iraq and al-Sham (ISIS). The Libya intervention has harmed other U.S. interests as well: undermining nuclear nonproliferation, chilling Russian cooperation at the UN, and fueling Syria&rsquo;s civil war.?</em></p> <p>&nbsp;</p> <p><em><strong>Despite what defenders of the mission claim, there was a better policy available&mdash;not intervening at all, because peaceful Libyan civilians were not actually being targeted.</strong> Had the United States and its allies followed that course, they could have spared Libya from the resulting chaos and given it a chance of progress under Qaddafi&rsquo;s chosen successor: his relatively liberal, Western-educated son Saif al-Islam. Instead, Libya today is riddled with vicious militias and anti-American terrorists&mdash;and thus serves as a cautionary tale of how humanitarian intervention can backfire for both the intervener and those it is intended to help.?</em></p> <p>&nbsp;</p> <p><em>Optimism about Libya reached its apogee in July 2012, when democratic elections brought to power a moderate, secular coalition government&mdash;a stark change from Qaddafi&rsquo;s four decades of dictatorship. But the country quickly slid downhill.<strong> Its first elected prime minister, Mustafa Abu Shagour, lasted less than one month in office. His quick ouster foreshadowed the trouble to come: as of this writing, Libya has had seven prime ministers in less than four years.</strong></em></p> <p>&nbsp;</p> <p><em>Islamists came to dominate the first postwar parliament, the General National Congress. Meanwhile, the new government failed to disarm dozens of militias that had arisen during NATO&rsquo;s seven-month intervention, especially Islamist ones, leading to deadly turf battles between rival tribes and commanders, which continue to this day. In October 2013, secessionists in eastern Libya, where most of the country&rsquo;s oil is located, declared their own government. That same month, Ali Zeidan, then the country&rsquo;s prime minister, was kidnapped and held hostage. In light of the growing Islamist influence within Libya&rsquo;s government, in the spring of 2014, the United States postponed a plan to train an armed force of 6,000&ndash;8,000 Libyan troops.?</em></p> <p>&nbsp;</p> <p><em>By May 2014, Libya had come to the brink of a new civil war&mdash;between liberals and Islamists. That month, a renegade secular general named Khalifa Hifter seized control of the air force to attack Islamist militias in Benghazi, later expanding his targets to include the Islamist-dominated legislature in Tripoli. Elections last June did nothing to resolve the chaos. Most Libyans had already given up on democracy, as voter turnout dropped from 1.7 million in the previous poll to just 630,000. Secular parties declared victory and formed a new legislature, the House of Representatives, but the Islamists refused to accept that outcome. <strong>The result was two competing parliaments, each claiming to be the legitimate one.?</strong></em></p> <p>&nbsp;</p> <p><em>In July, an Islamist militia from the city of Misurata responded to Hifter&rsquo;s actions by attacking Tripoli, prompting Western embassies to evacuate. After a six-week battle, the Islamists captured the capital in August on behalf of the so-called Libya Dawn coalition, which, together with the defunct legislature, formed what they labeled a &ldquo;national salvation government.&rdquo; In October, the newly elected parliament, led by the secular Operation Dignity coalition, fled to the eastern city of Tobruk, where it established a competing interim government, which Libya&rsquo;s Supreme Court later declared unconstitutional. <strong>Libya thus finds itself with two warring governments, each controlling only a fraction of the country&rsquo;s territory and militias.?</strong></em></p> <p>&nbsp;</p> <p><em>As bad as Libya&rsquo;s human rights situation was under Qaddafi, it has gotten worse since NATO ousted him. Immediately after taking power, the rebels perpetrated scores of reprisal killings, in addition to torturing, beating, and arbitrarily detaining thousands of suspected Qaddafi supporters. The rebels also expelled 30,000 mostly black residents from the town of Tawergha and burned or looted their homes and shops, on the grounds that some of them supposedly had been mercenaries. Six months after the war, Human Rights Watch declared that the abuses &ldquo;appear to be so widespread and systematic that they may amount to crimes against humanity.&rdquo;?</em></p> <p>&nbsp;</p> <p><em>As a consequence of such pervasive violence, the UN estimates that roughly 400,000 Libyans have fled their homes, a quarter of whom have left the country altogether. ?</em></p> <p>&nbsp;</p> <p><em>Libya&rsquo;s quality of life has been sharply degraded by an economic free fall. That is mainly because the country&rsquo;s production of oil, its lifeblood, remains severely depressed by the protracted conflict. Prior to the revolution, Libya produced 1.65 million barrels of oil a day, a figure that dropped to zero during NATO&rsquo;s intervention. Although production temporarily recovered to 85 percent of its previous rate, ever since secessionists seized eastern oil ports in August 2013, output has averaged only 30 percent of the prewar level. Ongoing fighting has closed airports and seaports in Libya&rsquo;s two biggest cities, Tripoli and Benghazi. In many cities, residents are subjected to massive power outages&mdash;up to 18 hours a day in Tripoli. <strong>The recent privation represents a stark descent for a country that the UN&rsquo;s Human Development Index traditionally had ranked as having the highest standard of living in all of Africa.?</strong></em></p> </blockquote> <p>So intervention actually destroyed a country that was doing very well compared to the rest of Africa, and turned it into a violent, economic disaster zone/terrorist camp.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>Although the White House justified its mission in Libya on humanitarian grounds, the intervention in fact greatly magnified the death toll there. To begin with, Qaddafi&rsquo;s crackdown turns out to have been much less lethal than media reports indicated at the time. In eastern Libya, where the uprising began as a mix of peaceful and violent protests, <strong>Human Rights Watch documented only 233 deaths in the first days of the fighting, not 10,000, as had been reported by the Saudi news channel Al Arabiya.</strong> In fact, as I documented in a 2013&nbsp;International Security&nbsp;article, from mid-February 2011, when the rebellion started, to mid-March 2011, when NATO intervened, only about 1,000 Libyans died, including soldiers and rebels. <strong>Although an Al Jazeera article touted by Western media in early 2011 alleged that Qaddafi&rsquo;s air force had strafed and bombed civilians in Benghazi and Tripoli, &ldquo;the story was untrue,&rdquo;</strong> revealed an exhaustive examination in the&nbsp;London Review of Booksby Hugh Roberts of Tufts University. Indeed, striving to minimize civilian casualties, Qaddafi&rsquo;s forces had refrained from indiscriminate violence.?</em></p> </blockquote> <p>Saudis lying as usual to get a war going. No surprise there.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>Moreover, by the time NATO intervened, Libya&rsquo;s violence was on the verge of ending. Qaddafi&rsquo;s well-armed forces had routed the ragtag rebels, who were retreating home. By mid-March 2011, government forces were poised to recapture the last rebel stronghold of Benghazi, thereby ending the one-month conflict at a total cost of just over 1,000 lives. <strong>Just then, however, Libyan expatriates in Switzerland affiliated with the rebels issued warnings of an impending &ldquo;bloodbath&rdquo; in Benghazi, which Western media duly reported but which in retrospect appear to have been propaganda.</strong> In reality, on March 17, Qaddafi pledged to protect the civilians of Benghazi, as he had those of other recaptured cities, adding that his forces had &ldquo;left the way open&rdquo; for the rebels to retreat to Egypt. <strong>Simply put, the militants were about to lose the war, and so their overseas agents raised the specter of genocide to attract a NATO intervention&mdash;which worked like a charm.</strong> There is no evidence or reason to believe that Qaddafi had planned or intended to perpetrate a killing campaign. ?</em></p> <p>&nbsp;</p> <p><em>This grim math leads to a depressing but unavoidable conclusion. Before NATO&rsquo;s intervention, Libya&rsquo;s civil war was on the verge of ending, at the cost of barely 1,000 lives. Since then, however, Libya has suffered at least 10,000 additional deaths from conflict.<strong> In other words, NATO&rsquo;s intervention appears to have increased the violent death toll more than tenfold.?</strong></em></p> <p>&nbsp;</p> <p><em><strong>Since NATO&rsquo;s intervention in 2011, however, Libya and its neighbor Mali have turned into terrorist havens.</strong> Radical Islamist groups, which Qaddafi had suppressed, emerged under NATO air cover as some of the most competent fighters of the rebellion. Supplied with weapons by sympathetic countries such as Qatar, the militias refused to disarm after Qaddafi fell. Their persistent threat was highlighted in September 2012 when jihadists, including from the group Ansar al-Sharia, attacked the U.S. diplomatic compound in Benghazi, killing Christopher Stevens, the U.S. ambassador to Libya, and three of his colleagues. Last year, the UN formally declared Ansar al-Sharia a terrorist organization because of its affiliation with al Qaeda in the Islamic Maghreb.?</em></p> <p>&nbsp;</p> <p><em><strong>NATO&rsquo;s intervention also fostered Islamist terrorism elsewhere in the region. When Qaddafi fell, the ethnic Tuaregs of Mali within his security forces fled home with their weapons to launch their own rebellion.</strong> That uprising was quickly hijacked by local Islamist forces and al Qaeda in the Islamic Maghreb, which declared an independent Islamic state in Mali&rsquo;s northern half. By December 2012, this zone of Mali had become &ldquo;the largest territory controlled by Islamic extremists in the world,&rdquo; according to Senator Christopher Coons, chair of the U.S. Senate Subcommittee on Africa. </em></p> <p>&nbsp;</p> <p><em>The harm from the intervention in Libya extends well beyond the immediate neighborhood. For one thing, by helping overthrow Qaddafi, the United States undercut its own nuclear nonproliferation objectives. In 2003, Qaddafi had voluntarily halted his nuclear and chemical weapons programs and surrendered his arsenals to the United States. His reward, eight years later, was a U.S.-led regime change that culminated in his violent death. That experience has greatly complicated the task of persuading other states to halt or reverse their nuclear programs. <strong>Shortly after the air campaign began, North Korea released a statement from an unnamed Foreign Ministry official saying that &ldquo;the Libyan crisis is teaching the international community a grave lesson&rdquo; and that North Korea would not fall for the same U.S. &ldquo;tactic to disarm the country.&rdquo; Iran&rsquo;s supreme leader, Ayatollah Ali Khamenei, likewise noted that Qaddafi had &ldquo;wrapped up all his nuclear facilities, packed them on a ship, and delivered them to the West.&rdquo; Another well-connected Iranian, Abbas Abdi, observed: &ldquo;When Qaddafi was faced with an uprising, all Western leaders dropped him like a brick. Judging from that, our leaders assess that compromise is not helpful.&rdquo;?</strong></em></p> <p>&nbsp;</p> <p><em><strong>The intervention in Libya may also have fostered violence in Syria.</strong> In March 2011, Syria&rsquo;s uprising was still largely nonviolent, and the Assad government&rsquo;s response, although criminally disproportionate, was relatively circumscribed, claiming the lives of fewer than 100 Syrians per week. After NATO gave Libya&rsquo;s rebels the upper hand, however, Syria&rsquo;s revolutionaries turned to violence in the summer of 2011, perhaps expecting to attract a similar intervention. &ldquo;It&rsquo;s similar to Benghazi,&rdquo; a Syrian rebel told&nbsp;The Washington Post&nbsp;at the time, adding, &ldquo;We need a no-fly zone.&rdquo; <strong>The result was a massive escalation of the Syrian conflict, leading to at least 1,500 deaths per week by early 2013, a 15-fold increase. ?</strong></em></p> <p>&nbsp;</p> <p><em>NATO&rsquo;s mission in Libya also hindered peacemaking efforts in Syria by greatly antagonizing Russia. With Moscow&rsquo;s acquiescence, the UN Security Council had approved the establishment of a no-fly zone in Libya and other measures to protect civilians. But NATO exceeded that mandate to pursue regime change. The coalition targeted Qaddafi&rsquo;s forces for seven months&mdash;even as they retreated, posing no threat to civilians&mdash;and armed and trained rebels who rejected peace talks. <strong>As Russian President Vladimir Putin complained, NATO forces &ldquo;frankly violated the UN Security Council resolution on Libya, when instead of imposing the so-called no-fly zone over it they started bombing it too.&rdquo;</strong> His foreign minister, Sergey Lavrov, explained that as a result, in Syria, Russia &ldquo;would never allow the Security Council to authorize anything similar to what happened in Libya.&rdquo; </em></p> <p>&nbsp;</p> <p><em><strong>Despite the massive turmoil caused by the intervention, some of its unrepentant supporters claim that the alternative&mdash;leaving Qaddafi in power&mdash;would have been even worse.</strong> But Qaddafi was not Libya&rsquo;s future in any case. Sixty-nine years old and in ill health, he was laying the groundwork for a transition to his son Saif, who for many years had been preparing a reform agenda. &ldquo;I will not accept any position unless there is a new constitution, new laws, and transparent elections,&rdquo; Saif declared in 2010. &ldquo;Everyone should have access to public office. We should not have a monopoly on power.&rdquo; Saif also convinced his father that the regime should admit culpability for a notorious 1996 prison massacre and pay compensation to the families of hundreds of victims. In addition, in 2008, Saif published testimony from former prisoners alleging torture by revolutionary committees&mdash;the regime&rsquo;s zealous but unofficial watchdogs&mdash;whom he demanded be disarmed.?</em></p> </blockquote> <p>The &ldquo;alternative would have been worse&rdquo; is the shallow response told by status quo criminals the world over when it comes to defending their crimes. It&rsquo;s the same response peddled by the architects of the &ldquo;too big&nbsp;to fail&rdquo; taxpayer bailout of financial oligarchs.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><div> <p><em><em>Even after the war began, respected observers voiced confidence in Saif. In a&nbsp;New York Times&nbsp;op-ed, Curt Weldon, a former ten-term Republican U.S. congressman from Pennsylvania, wrote that Saif &ldquo;could play a constructive role as a member of the committee to devise a new government structure or Constitution.&rdquo; <strong>Instead, NATO-supported militants captured and imprisoned Qaddafi&rsquo;s son.</strong></em></em></p> <p>&nbsp;</p> <p><em>Obama also acknowledges regrets about Libya, but unfortunately, he has drawn the wrong lesson. &ldquo;I think we underestimated . . . the need to come in full force,&rdquo; the president told the&nbsp;New York Times&nbsp;columnist Thomas Friedman in August 2014. &ldquo;If you&rsquo;re gonna do this,&rdquo; he elaborated, &ldquo;there has to be a much more aggressive effort to rebuild societies.&rdquo;?</em></p> <p>&nbsp;</p> <p><em>Humanitarian intervention should be reserved for the rare instances in which civilians are being targeted and military action can do more good than harm, such as Rwanda in 1994, where I have estimated that a timely operation could have saved over 100,000 lives. Of course, great powers sometimes may want to use force abroad for other reasons&mdash;to fight terrorism, avert nuclear proliferation, or overthrow a noxious dictator. But they should not pretend the resulting war is humanitarian, or be surprised when it gets a lot of innocent civilians killed.</em></p> </div> </blockquote> <p>Think about all of this very carefully and deeply. A conflict initiated based purely on lies and propaganda destroyed the lives of millions, destabilized several nations, created a terrorist breeding ground, crushed&nbsp;all incentives for nuclear disarmament, escalated the conflict in Syria, and damaged&nbsp;the U.S.-Russian relationship. Yet, despite all of this, the lesson Obama gleaned from the debacle was:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong><em>&ldquo;I think we underestimated . . . the need to come in full force. If you&rsquo;re gonna do this there has to be a much more aggressive effort to rebuild societies.&rdquo;?</em></strong></p> </blockquote> <p>Which is precisely why America will continue to gear up for war after war after war&hellip;</p> <p>*&nbsp; *&nbsp; *</p> <p><em>For related articles, see:</em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to More Foreign Policy Incompetence – U.S. Humanitarian Aid is Going Directly to ISIS">More Foreign Policy Incompetence &ndash; U.S. Humanitarian Aid is Going Directly to ISIS</a></em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to Leon Panetta, Head of Pentagon and C.I.A. Under Obama, Says Brace for 30 Year War with ISIS">Leon Panetta, Head of Pentagon and C.I.A. Under Obama, Says Brace for 30 Year War with ISIS</a></em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to U.S. Propaganda Enters Into Insane, Irrational Overdrive in Attempt to “Sell” War in Syria">U.S. Propaganda Enters Into Insane, Irrational Overdrive in Attempt to &ldquo;Sell&rdquo; War in Syria</a></em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to Obama’s ISIS War is Not Only Illegal, it Makes George W. Bush Look Like a Constitutional Scholar">Obama&rsquo;s ISIS War is Not Only Illegal, it Makes George W. Bush Look Like a Constitutional Scholar</a></em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to The American Public: A Tough Soldier or a Chicken Hawk Cowering in a Cubicle? Some Thoughts on ISIS Intervention">The American Public: A Tough Soldier or a Chicken Hawk Cowering in a Cubicle? Some Thoughts on ISIS Intervention</a></em></p> <p><em><a href="" rel="bookmark" title="Permanent Link to America’s Disastrous Foreign Policy – My Thoughts on Iraq">America&rsquo;s Disastrous Foreign Policy &ndash; My Thoughts on Iraq</a></em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="377" height="223" alt="" src="" /> </div> </div> </div> B+ Barack Obama Fail Iran Iraq New York Times North Korea Reality Switzerland Testimony Too Big To Fail Vladimir Putin White House Sat, 28 Feb 2015 00:45:27 +0000 Tyler Durden 502636 at Spot The Odd Vol Out <p>Despite the well-managed collapse of Equity, FX, and Rates volatility in February, the <strong>Oil complex is exhibiting Lehman-Depression-like levels of implied vol</strong> still as central planners seem unable (or unwilling) to manipulate the energy complex (rock of inflation and hard place of 'consumer tax cut'?). <a href="">As WSJ reports,</a> this volatility is roiling market makers, luring fast-money traders (and algos) and discouraging long-term investors from hedging/positioning. As one asset manager noted, <strong><em>"we like volatile two-way markets... but this is too high for us."</em></strong></p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="312" /></a></p> <p>&nbsp;</p> <p>Perhaps, just perhaps, given the potential difficulty/disagreement of central banks agreeing on how best to manipulate oil prices (and thus lower vol), it is the only (along with The Baltic Dry Index) <strong>indicator of the imbalance between excess mal-investment-driven supply and Greenspan's "Depression-like global demand."</strong></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="959" height="499" alt="" src="" /> </div> </div> </div> Baltic Dry Central Banks Volatility Sat, 28 Feb 2015 00:10:54 +0000 Tyler Durden 502634 at "Monetary Policy Is Bankrupt" Dr. Lacy Hunt Warns "Bonds, Not Stocks, Are A Good Economic Indicator" <p><a href=""><em>Submitted by Erico Matias Tavares via Sinclair &amp; Co.</em></a>,</p> <p><u><strong>In Search of Solutions &ndash; An Interview with Dr. Lacy H. Hunt</strong></u></p> <p><em>We had the great pleasure of speaking with Dr. Lacy H. Hunt on the current state of the economy, the limitations of monetary policy and potential solutions to the overindebtedness problem in the main global economies.</em></p> <p><em><strong>Erico Tavares: Dr. Hunt, thank you for being with us today. </strong><strong>Your firm manages over $6 billion in treasuries. With the S&amp;P500 at record highs, do you share equity investors&rsquo; enthusiasm with the economic prospects of America?</strong></em></p> <p>Lacy Hunt: <u>I think the S&amp;P is disconnected from the fundamentals in the US economy. </u>Growth last year was a quarter slower than it was in 2013. We&rsquo;re on the cusp of either zero inflation or deflation. Corporate profits using the Bureau of Economic Analysis numbers, compiled using data from the Internal Revenue Service, showed year over declines in all the first three quarters of last year (4Q is not yet available). In the third quarter, the after-tax profits adjusted for inventory gains/losses and over/under depreciation were 7% below a year ago.</p> <p><u>The standard of living declined again in 2014.</u> And a lot of the growth we had in 2014 really was a massive building of inventories, which is often the case when stock prices are high and top line is decelerating.</p> <p>The economy enters 2015 in very weak shape. None of the big ticket sectors are doing well. Capital spending is declining, being paced by extreme weakness in oil &amp; gas drilling, which has really been the driving force in manufacturing over the last four years. The best you can say about the housing sector is that it is flat. Not a very important sector.</p> <p>Vehicle sales are below the best levels of last year and the trade sector is deteriorating.<u> It is very difficult to move the US economy forward by selling things over the counter and through the shopping cart. The US economy is very fragile. And the fragility is highlighted by the fact that firms simply do not have pricing power.</u></p> <p><em><strong>ET: Historically the S&amp;P used to lead the economic cycle by a few months, sometimes there was a lag. In a sense the signaling of equity markets has been muffled by the excitement about central bank intervention. Is that correct?</strong></em></p> <p>LH: Well I&rsquo;m not an equity investor but<u> I don&rsquo;t believe in the wealth effect. While a theoretical possibility, it is not supported by economic fact. Let&rsquo;s go back and look at a few historical examples.</u></p> <p><u>The stock market did not turn down in 1927 and then the Great Depression started two years later. The stock market only turned down in 1929 in the same year as the economy. The stock market didn&rsquo;t turn down in 1998, two years before the recession. It turned down coincidentally. The fact of the matter is the stock market is not a very good indicator. The wealth effect is a theoretical possibility but no one can really measure it for the reasons that I discussed.</u></p> <p>Another problem here is that the threshold studies done by econometricians who look at folks that have income less than $130,000 can&rsquo;t even find a wealth effect and for good reason. These folks don&rsquo;t have equity holdings. Upper income individuals do, but they are not income constrained. So the fact of the matter is the wealth effect is a theoretical possibility but nothing more than that. <strong><u>And the stock market is not a good guide to the economy.</u></strong></p> <p><em><strong>ET: In a sense the search for yield pursuant to major central banks around the world pushing interest rates all the way down to zero has largely placed investors in the same side of the market. Just being moderately cautious has caused many equity fund managers to underperform their benchmarks, particularly since early 2013. </strong></em></p> <p><em><strong>As long as central banks continue to pump money and maintain interest rates at zero, do you see it as inevitable that equities will just have to keep going higher?</strong></em></p> <p>LH: I&rsquo;m a treasury investor and I can be anywhere in the curve. The Federal Reserve has made very significant pronouncements about economic growth. They have been overly optimistic at their final forecast in 2013 for 2014, projecting 3.2% growth which turned out to be 2.5%, and that may even be revised lower. Their inflation forecast was wide off the mark.</p> <p><u>As treasury investors we can&rsquo;t afford to listen to the Fed. </u>As a matter of fact we positioned ourselves at the long end of the curve, and have been there for a long time, and during this whole time period they were talking very optimistically about the economy, inflation and so forth, and none of those materialized.</p> <p>I&rsquo;m only going to defend what is going on in the bond market and <u>the bond market is a very good economic indicator. When bond yields are very low and declining it&rsquo;s an indication that the same is happening to inflation and that economic activity is weak. The bond yields are not here for any fluke of reason. They are here because business conditions in the US and abroad are quite poor.</u></p> <p><em><strong>ET: Keynesian theory has pretty much dominated macroeconomic thinking over the last thirty years. Its &ldquo;consume now, pay later&rdquo; policies provide a short-term boost and fit well with politicians&rsquo; desire to prop up the economy on their watch. A large number of economists in government, private sector and academia, believe that adding more debt to a debt-inspired crisis is the only solution, and that at some point the economy will reach escape velocity and help pay down those debts. </strong></em></p> <p><em><strong>Do you subscribe to this view, especially at these very high debt levels in the economy?</strong></em></p> <p>LH: <em>I think that monetary policy at this stage of the game is largely bankrupt. There is certainly nothing that they can do.</em></p> <p>Monetary policy works through price effects, quantity effects, the potential wealth effect and the currency depreciation effect. None of those mechanisms are operative.</p> <p><u>The price effects don&rsquo;t work because the short-term interest rates are at the zero bounds, so that&rsquo;s out of the picture.</u></p> <p>The US central bank, the ECB and the Bank of Japan have greatly expanded their balance sheets, but that&rsquo;s not printing money. Money is an increase in deposits that are available to households and businesses. US monetary growth today is under 6% in the last 12 months, which is lower than when quantitative easing started. The Bank of Japan has doubled the monetary base in the last two years and yet M2 growth is 3% and a little bit more. The same is true in Europe.</p> <p><u>Moreover, money alone does not determine economic activity.</u> The velocity of money has fallen to a six-decade low in the US. It has been falling substantially in Europe, as in Japan. When you look at money growth and velocity it&rsquo;s hard to see where nominal growth can be much better than 1% in Europe and Japan and no better than 2-2.5% in the US. Monetary policy does not benefit from quantitative effects when economies are extremely over indebted. The velocity of money falls and the banks are undercapitalized &ndash; banks don&rsquo;t make loans based on excess reserves, but rather based on capital.</p> <p><u>The currency depreciation option by excessive monetary liquidity does provide a transitory benefit. We saw this one when quantitative easing 1 was started in the US, but that&rsquo;s a transitory benefit: other countries eventually retaliate making everyone worse off.</u></p> <p><u>And the final option is the wealth effect but there is no empirical support for it.</u></p> <p><u>So there&rsquo;s really nothing that monetary policy can do and the fact that inflation in the US is substantially lower than when all of these quantitative easing efforts started is an indication that such policies are a bankrupt effort.</u></p> <p><em><strong>ET: So it seems that we are coming to the end of the rope here. We tried this one out, it did not quite work as the central bankers had expected it would, certainly the inflation is not here, but it did avoid a deflationary crash right?</strong></em></p> <p>LH: That&rsquo;s not clear because the results are not in and the fact of the matter is that according to new research by the McKinsey Global Institute, as well as others like the Geneva Group, the world is substantially more levered now than at the time of the failure of Bear Sterns and Lehman. They calculate that public and private debt is now $57 trillion greater than in 2007, or 17 percentage points higher relative to GDP.</p> <p><u>The overindebtedness buys a transitory gain in economic activity in lieu of a decline in future spending and, moreover, extreme overindebtedness cuts into the economic growth, it increases the risk of disinflation, if not deflation, and the fact of the matter is that the monetary efforts have probably made the world more unstable.</u></p> <p><em><strong>ET: It is said that organizations in crisis tend to repeat the same mistakes, only faster and with more intensity. Japan certainly seems to be following down that path with their latest rounds of aggressive quantitative easing.</strong></em></p> <p>LH: I think that&rsquo;s an excellent example.<u> In their panic of 1989 public and private debt was about 400% of GDP, more or less. It&rsquo;s currently at 650% of GDP. They have greatly increased the indebtedness of the overall economy but the level of nominal GDP is no higher than it was 23 years ago. The results have been very, very poor.</u></p> <p><em><strong>ET: A grounded perspective might have prompted a rethink of the current stimulative policies, but it seems too many people are vested in the status quo. Given your extensive experience as a senior economist across a number of prominent institutions, including the Federal Reserve system, is this resistance to change something that concerns you?</strong></em></p> <p>LH: I&rsquo;m not in the mind changing business; I&rsquo;m in the investment management business. I am just trying to execute a fiduciary responsibility to our clients and we are operating under the assumption that quantitative easing will not be successful. We&rsquo;ve operated under that assumption in the US.</p> <p>Those who believed that economic growth would accelerate and that inflation would go up thought that investing in long treasuries would be a bad idea, and that notion did not pan out. Investors who saw the failure of quantitative easing, poor economic performance and low inflation were amply rewarded by being long long-term treasuries.</p> <p>And so it is not my objective here to change how the world thinks. I&rsquo;m trying to execute a fiduciary responsibility and that&rsquo;s all.</p> <p><em><strong>ET: OK but let&rsquo;s consider a non-conventional solution and how that might impact your current assessment. The major central banks could get together and say you know what, we have too much debt in our books, our economies are overindebted, let&rsquo;s write off a chunk and move forward from here.</strong></em></p> <p>LH: Unfortunately those excess reserves are owned by the banks. If you wrote them off you would destroy a substantial portion of bank assets and the commercial banks and the other holders would go into a negative situation.</p> <p>It is a flight of fancy to assume that these debts can be written off. That&rsquo;s certainly not an option in the US, maybe the Europeans could do it but it would likely have the same effect. It is just not a realistic choice and it&rsquo;s not practical. The banks are already terribly undercapitalized, you could not take away $3 or $4 trillion dollars&rsquo; worth of assets from the system.</p> <p><em><strong>ET: What about some good ol&rsquo; fashion money-printing? In other words, why doesn&rsquo;t the government settle its debts with cash envelopes as opposed to having to issue more bonds? Of course this is highly inflationary, but isn&rsquo;t deflation what the central banks are desperately trying to avoid?</strong></em></p> <p>LH: Here again, in the case of the US you would have to abandon the fractional reserve requirement system which I don&rsquo;t think is doable. And I&rsquo;m doubtful it is doable in Europe. We can talk about it as a theoretical possibility but it does not really exist as an option.</p> <p><u>The fact of the matter is that a debt is an increase in current spending and decline in future spending unless the debt generates an income stream to repay principal and interest. More debt that is either unproductive or counterproductive is the path towards instability, disinflation and poor economic growth, not better economic performance.</u></p> <p><em><strong>ET: So how do you see all of this unfolding given the dearth of solutions at this point?</strong></em></p> <p>LH: I think it means we are in a protracted period of underperformance, minimal inflation, possibly deflation.</p> <p><u>There are fiscal policy solutions, but they require shared sacrifice, </u>explaining complex ideas to a public that is ill informed and strong political leadership, and we don&rsquo;t have that in the US, you don&rsquo;t have that in Europe, they don&rsquo;t have it in Japan.</p> <p>So for all intents and purposes fiscal policies is out of the game and in that environment the political sector turns to the central banks, but the fact of the matter is that the central banks&rsquo; bag of tricks is empty.</p> <p><em><strong>ET: Can you give an example of a fiscal policy that should be considered to address the problem?</strong></em></p> <p>LH: Well, you have to take advantage of the fact that we learned a great deal about the government expenditure multipliers and government tax multipliers.</p> <p><u>We&rsquo;ve learned that contrary to Keynesian theory the government expenditure multiplier is zero, if not slightly negative. </u>So there may be a transitory benefit to deficit spending but it is so quickly reversed that ultimately an expansion in government expenditure financed with debt will make economies weaker. So what you have to do is scale back government spending, particularly those types of spending that go to finance daily needs. But that&rsquo;s politically impossible to do.</p> <p>And at the same time you basically need to shift income based taxes to consumption based taxes, but you have to address the regressivity of the consumption based taxes. The multipliers of consumption based taxes are minus one, the multipliers on income based taxes are in the minus two to minus three.</p> <p><u>These concepts are too difficult for the general public to understand. So they really can&rsquo;t be explained to them. And furthermore you don&rsquo;t have the strong political leadership and it has to be done in the context of shared sacrifice.</u></p> <p>So there are fiscal policy options but they are not achievable. Now occasionally you get into an unusual circumstance where an exceptional individual steps forward and the country understands the nature of its problem. A number of years ago Canada had a very far-sighted financial leader by the name of George Martin who developed a program of shared sacrifice and was able to turn the country around. But people bought on to the program because everybody&rsquo;s ox was getting gored a little bit, and Martin had the rare capability of being able to explain the efficacy of the overall program.</p> <p>I don&rsquo;t see that happening in the US and Europe. Hopefully I am wrong on that, but the fiscal policy options are there although simply not achievable in the current environment.</p> <p><em><strong>ET: So a concern is that in Southern Europe people have been asked to make the sacrifice and implement austerity, but the results have been very dubious, where Greece provides an extreme example.</strong></em></p> <p>LH: I don&rsquo;t think that was an effective program. You have to move away from the government expenditure programs, but at the same time you cannot contract your economy. You need to make a shift from income based taxes, which have a high negative multiplier, to consumption based taxes, which have a low negative multiplier, and you have to do this in the context of not increasing the debt of the government institutions. And that&rsquo;s like trying to take a camel through the eye of a needle.</p> <p><em><strong>ET: You need a very good driver for that!</strong></em></p> <p>LH: Yes you do.</p> <p><em><strong>ET: Dr. Hunt, thank you very much for your time and your insights. This has been a really insightful discussion.</strong></em></p> <p>LH: That&rsquo;s great, nice to be with you.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="531" height="483" alt="" src="" /> </div> </div> </div> Bank of Japan Bond Central Banks Deficit Spending Equity Markets Excess Reserves Federal Reserve Great Depression Greece Japan Lehman M2 McKinsey Monetary Base Monetary Policy Nominal GDP None Quantitative Easing Recession Fri, 27 Feb 2015 23:35:19 +0000 Tyler Durden 502633 at WTF Chart Of The Day - Fantasy February Edition <p>Presented with little comment but to say <strong><em>"Thank you Jim..."</em></strong></p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="316" /></a></p> <p>&nbsp;</p> <p><a href="">His comments, as we noted previously,</a> changed the narrative back to "bad news is good news" and so it goes.</p> <p>&nbsp;</p> <p><em>Charts: Bloomberg</em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="958" height="505" alt="" src="" /> </div> </div> </div> Fri, 27 Feb 2015 23:00:09 +0000 Tyler Durden 502632 at