en A Blueprint for Investing in Frontier Markets <p style="text-align: center;"><span style="color: #800000;">By: Mark Wallace at&nbsp;</span><a href="" style="text-align: left;"></a></p> <p> <strong><em>Our friends at Pathfinder Capital have created an excellent report on frontier markets. These guys live and breath the frontier, putting boots on the ground where most of us wouldn't care to visit. </em></strong></p> <p><strong><em></em></strong></p> <p>Both of the founders are ex-military guys who cut their teeth in places like Libya, Iraq and eastern Europe. Chris and I have spent a lot of time with them, including at our Meet Ups in Mongolia, Cambodia, Singapore and Sri Lanka. We really respect their analysis and expertise. We recommend taking the time to download and review their report linked at the end of this post.</p> <p>-------- </p> <p> <em>Courtesy of Pathfinder Capital</em></p> <p>Last week we attended an asset management conference in London, in which the agenda featured several prominent speakers and a panel conference on emerging markets. We noted that some of the UK's largest fund managers would be represented in the discussion, so with our curiosity piqued we walked down to Threadneedle Street in order to listen in.</p> <p>For the most part the event did not disappoint – it's always useful to hear other fund managers discuss the issues that keep them awake at night. However we were somewhat taken aback by one comment at the emerging markets panel; in general, this person (a partner at a firm claiming to focus on the emerging markets) told the audience that he didn't see any reason to distinguish between the emerging and frontier markets, given the relatively high correlations of their currencies and equity indices.</p> <p><a href=""><img src="" alt="Emerging and Frontier Markets Performance" width="430" height="271" style="display: block; margin-left: auto; margin-right: auto;" class="aligncenter size-alert-medium wp-image-8108" /></a> </p> <p>In our opinion, this comment couldn’t have been further off the mark – and we have the empirical evidence to back it up. At the bottom of this post you can see a link to our latest white paper "Introducing the I-3". We have spent the past several months building this document, with special thanks to our friends Owain Mulligan (currently at London Business School) and Joe Holliday (currently at Harvard Business School) for their invaluable assistance.</p> <p>Many institutional investors have acknowledged that frontier markets deserve consideration as a distinct asset class. After twenty years of strong growth, the "traditional" emerging markets (the famed BRICs of Brazil, Russia, India and China) are beginning to resemble developed Western economies. However, the majority of global growth in the next decade will instead be generated by "frontier markets". Indeed, over the past five years, 43 of the 47 highest-growth economies have come from the frontier. Less than one third of those are represented on mainstream equity indices. </p> <p><a href="" style="font-size: 1em; line-height: 1.3em;"><img src="" alt="Kuwait Stock Exchange" width="300" height="225" style="display: block; margin-left: auto; margin-right: auto;" class="aligncenter size-medium wp-image-8106" /></a><span style="font-size: 1em; line-height: 1.3em;"><br /> </span></p> <p><span style="font-size: 1em; line-height: 1.3em;">Traditional definitions of the frontier market are unsatisfactory. They are typically defined as "those markets that are not yet classified as developed or emerging markets". While this is technically true, and a valid first step, frontier markets can also be defined by the specific characteristics they exhibit in comparison to more developed economies:</span></p> <ul> <li>Lower liquidity</li> <li>Smaller market capitalization</li> <li>Higher trading costs</li> <li>Higher volatility</li> <li>Reduced transparency</li> <li>Higher geopolitical/sovereign political risk</li> </ul> <p> It should also be recognized that frontier markets are not homogenous. In fact, they can be further broken down into three distinct categories that we have identified as the I-3: </p> <ul> <li><strong>Indexed Frontier.</strong> Countries that are included on mainstream equity indices.</li> <li><strong>Illiquid Frontier.</strong> Countries that have small stock exchanges with low trading volumes and low market cap-to-GDP ratios.</li> <li><strong>Isolated Frontier.</strong> Those high-growth economies that do not have a sovereign stock exchange, or participate in a regional stock exchange.</li> </ul> <p> Between 2008 and 2012, forty-seven economies achieved an average annual GDP growth rate greater than 5% (see Figure 1). Of these, none were developed economies and only four were classified as emerging markets, leaving 43 from the frontier.</p> <p><a href=""><img src="" alt="Frontier Markets Table" width="530" height="520" style="display: block; margin-left: auto; margin-right: auto;" class="aligncenter size-alert-max wp-image-8103" /></a> </p> <p>Most investors overlook frontier markets due to perceptions of higher risk and, often more so, a general lack of familiarity. Frontier markets also have little or no representation in mainstream equity indices and are therefore not easily investable. While a handful of frontier-focused indices exist, their market capitalization remains very small when compared to emerging markets equity indices. This lack of representation creates difficulties for the investor who seeks exposure to this exciting asset class. In this era of quantitative easing and negative real deposit rates, investors are increasingly turning to the high growth opportunities offered in the frontier markets. After reading the attached document, we believe that the reasons behind this trend will become plainly evident. </p> <p> -------- </p> <p> You can read Pathfinder's latest "Introducing the I-3" white paper <a href=";id=da5f1c6e23&amp;e=412da3a6f5" target="_blank">here</a>. </p> <p> - Mark </p> <p> <em>"Country selection is more important in frontier markets than in emerging markets."</em> - Cliff Quisenberry, Caravan Capital Management</p> Brazil BRICs China Eastern Europe Gross Domestic Product Harvard Business School India Institutional Investors Iraq None Quantitative Easing Transparency Volatility Fri, 18 Apr 2014 00:01:38 +0000 Capitalist Exploits 487455 at Putin's Top 10 Q&A Quotes: "The US Will Cut Off Their Nose To Spite Their Face" <p><em>Originally posted at <a href=";a-ukraine-crimea-220/">Russia Today</a>,</em></p> <p>Ukraine&rsquo;s crisis was, predictably, at the center of Vladimir Putin&rsquo;s annual televised interview. He said the situation can only be solved through a compromise between internal players. Below are the president&rsquo;s ten most significant quotes.</p> <h2>&ldquo;[Yanukovich] didn&rsquo;t have the heart to sign an act that would see force used against his citizens&rdquo;</h2> <p>Answering a question from an ex-Berkut - Ukrainian special forces - commander as to whether the ousted Ukrainian President Viktor Yanukovich has always been such a <em>&ldquo;weakling and traitor,&rdquo;</em> Putin said that Yanukovich did his duty as he thought was right, proper and necessary.</p> <p><em>&ldquo;I spoke with him, certainly, many times, during the crisis, and after he arrived in the Russian Federation; we talked about using force&hellip; The gist of his answer was that he thought about using force many times, but he didn&rsquo;t have the heart to sign an act that would see force used against his citizens,&rdquo;</em> Putin said.</p> <h2>&ldquo;Faina Ivanovna, dear, what would you need Alaska for?&rdquo;</h2> <p>Asked by a pensioner if Alaska could follow Crimea&rsquo;s example, Putin said <em>&ldquo;We&rsquo;re a northern country. 70 percent of our territory is in the North or Far North. Is Alaska in the southern hemisphere? It&rsquo;s cold there as well. Let&rsquo;s keep cool about it,&rdquo;</em> Putin said.</p> <p>According to Putin, he is also aware of the fact that some Russians call Alaska &ldquo;Ice-Krym&rdquo; (&ldquo;Krym&rdquo; is the Russian for Crimea).</p> <h2>&ldquo;Tanks, jets against own people?! Are they nuts?&rdquo;</h2> <p>The Russian President said he thought that asking activists in the southeast of Ukraine to hand in their weapons was the right approach, but this measure should also be applied to armed Ukrainian nationalist groups.</p> <p>Putin also said that the crisis in Ukraine can only be solved through a compromise in the interests of the Ukrainian people.</p> <p><em>&ldquo;The coup-appointed government in Kiev needs to come to its senses before we can negotiate,&rdquo;</em> said Putin.</p> <p><img src="" /></p> <h2>&ldquo;They don&rsquo;t want to see us in PACE? Better lost than found!&rdquo;</h2> <p>Russia won&rsquo;t insist on staying in several international organizations, but isn&rsquo;t planning to walk out in protest, Putin said.</p> <p><em>&ldquo;The world is developing intensively, and if there a player who wants to turn it unipolar and align all organizations according to their will, it won&rsquo;t succeed,&rdquo;</em> the president added.</p> <h2>&ldquo;It&rsquo;s hard to speak with people who whisper at home, afraid of US surveillance.&rdquo;</h2> <p>Putin noted that there are some problems in the dialogue between Moscow and its European partners.</p> <p><em>&ldquo;Many Western countries have voluntarily relinquished a large part of their sovereignty. That is, among other things, the result of bloc policy. It&rsquo;s sometimes really difficult to negotiate with them on geopolitical issues,&rdquo;</em> he said.</p> <p><em>&ldquo;It&rsquo;s difficult to talk to people who whisper even at home, afraid of Americans eavesdropping on them. It&rsquo;s not a figure of speech, not a joke, I&rsquo;m serious.&rdquo;</em></p> <h2>&ldquo;Obama is a decent, courageous man, he would save me from drowning&rdquo;</h2> <p>To the question whether Obama would save the Russian President from drowning, Putin answered that the US president is <em>&ldquo;a decent, courageous man&rdquo;</em> and <em>&ldquo;would save&rdquo;</em> him.</p> <p>However, Putin stressed that the relationship between them wasn&rsquo;t a close one.</p> <p><em>&ldquo;In addition to intergovernmental relations, there are personal relations, but I don&rsquo;t think I have a close personal relationship with Obama,&rdquo;</em> the president said.</p> <h2>&ldquo;You&rsquo;re an ex-intelligence agent, I have something to do with intelligence, let&rsquo;s use professional terms&rdquo; &ndash; Putin to Snowden</h2> <p>Russia&rsquo;s president received a question from Edward Snowden who was granted political asylum last August. Snowden asked Putin if Russia is involved in <em>&ldquo;intercepting, storing and analyzing the data on communication carried out by millions of people&rdquo;</em> and whether Russia&rsquo;s president thinks this kind of mass control is fair and justified.</p> <p><img src="" /></p> <p>Putin stressed Snowden was an ex-intelligence agent, while he himself used to be in intelligence, so Russia&rsquo;s president said he would be speaking <em>&ldquo;using professional terms.&rdquo;</em></p> <p><em>&ldquo;First of all, we have strict laws governing the usage of any special means &ndash; including ones to monitor telephone conversations or the internet - by intelligence. This regulation makes it necessary to get a court order to surveil an individual. That&rsquo;s why we can&rsquo;t carry out mass surveillance, and we don&rsquo;t, in accordance with our law,&rdquo;</em> Putin said.</p> <h2>&ldquo;No plans to remain President for life&rdquo;</h2> <p>Putin, who served as president for two consecutive terms between 2000 and 2008 and was elected again in 2012, was asked if he wanted to remain Russia&rsquo;s head of state for life.</p> <p><em>&ldquo;No,&rdquo;</em> was his answer.</p> <p><img src="" /></p> <h2>&ldquo;Russia didn&rsquo;t annex Crimea by force, but created conditions for people&rsquo;s self-determination&rdquo;</h2> <p><em>&ldquo;Russia did not annex Crimea by force. Russia created conditions &ndash; indeed, with the help of special formations and the armed forces, I&rsquo;ll be honest &ndash; for the free expression of will by people living in Crimea and Sevastopol,&rdquo;</em> Putin said.</p> <p><em>&ldquo;The decision on joining [Russia] was made by the people themselves. Russia responded to that appeal and accepted Crimea and Sevastopol into its family. That&rsquo;s natural, it couldn&rsquo;t be any other way.&rdquo;</em></p> <h2>&ldquo;Punishing others, the US will cut off their nose to spite their face&rdquo;</h2> <p>Putin was asked why the US can do whatever it wants and no one punishes them, while attempts are being made to punish Russia.</p> <p><em>&ldquo;The US is certainly one of the world&rsquo;s leaders. At some point it seemed that it was the only leader and a uni-polar system was in place. Today it appears that is not the case. Everything in the world is interdependent and once you try to punish someone, in the end you will cut off your nose to spite your face,&rdquo;</em> he said.</p> Ukraine Vladimir Putin Thu, 17 Apr 2014 23:51:13 +0000 Tyler Durden 487453 at Wave To The Webcam Caption Contest <p>For an administration run by a "straight to TV" teleprompter, it is only fitting that the inspiration for reaching out to the unemployed masses should come straight from the Oscars. No Samsung's media stunt this time, just America's figurehead leaders kindly requesting everyone to please wave to the NSA-controlled webcam: after all they are on the other end, and smiling.</p> <blockquote class="twitter-tweet" lang="en"><p>Pals. <a href=""></a></p> <p>— The White House (@WhiteHouse) <a href="">April 17, 2014</a></p></blockquote> <script src="//"></script> Twitter Twitter White House Thu, 17 Apr 2014 23:11:59 +0000 Tyler Durden 487452 at Guest Post: Liberty Movement Rising <p><em>Submitted by Brandon Smith of <a href=""></a>,</em></p> <p><em><strong>&quot;Freedom had been hunted round the globe; reason was considered as rebellion; and the slavery of fear had made men afraid to think. But such is the irresistible nature of truth, that all it asks, and all it wants, is the liberty of appearing.&quot;&nbsp; - Thomas Paine </strong></em></p> <p>The label of &ldquo;fringe&rdquo; is a common one used by statists, bureaucrats and paid shills in order to marginalize those who would stand against government corruption. The primary assertion being sold is that the &ldquo;majority&rdquo; joyously supports the establishment; and the majority, of course, is always right.</p> <p>The liberty movement, which is a collection of numerous freedom organizations and political activists brought together by a shared philosophical bond, has been accused of &ldquo;fringe&rdquo; status for quite some time. With corporatist dominance over the mainstream media for decades backing an elitist machine in Washington and a global banking cartel footing the bill with money created from thin air, any such accusation can be made to seem &ldquo;real&rdquo; to those who are unaware.</p> <p>The problem has always been a matter of physical action giving rise to an acknowledgment of numbers.</p> <p>We have all heard the old story of the debate within the ancient Roman government over the idea of forcing the slave population to wear distinct armbands so that they could be more easily identified among the regular population. The concept was rejected on the realization that if the slaves were given a visual confirmation of their considerable numbers and strength, they would be encouraged to revolt against the Roman tyrants. That is to say, as long as the slaves felt isolated, they would remain apathetic and powerless. Of course, that was not always the case. Sometimes, a small group would stand up despite their supposed isolation, and the rest of the world, wide-eyed and astonished, would take notice.</p> <p>The liberty movement has just experienced one of its first great moments of realization and empowerment in Clark County, Nev., and millions of past naysayers have been shell-shocked.</p> <p>I covered my views in detail on the Bundy Ranch saga in Nevada in my article <a href="" target="_blank">&ldquo;Real Americans Are Ready To Snap,&rdquo;</a> amid the usual choir of disinformation agents and nihilists desperate to convince Web audiences that the liberty movement would do nothing to stop the Bureau of Land Management&rsquo;s militant assault on Cliven Bundy&rsquo;s cattle farm. This assault included hundreds of Federal agents, helicopters, contractors hired essentially as cattle rustlers and even teams of snipers.</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="//" width="560"></iframe></p> <p>The statists and socialists were certainly out in force to misrepresent the Bundy issue and frighten anyone who might consider taking a stand for the family. The <a href="" target="_blank">Southern Poverty Law Center</a>, not surprisingly, was hard at work spreading lies and disinformation about the confrontation in Nevada, painting a picture of fractured patriot groups and militiamen with &ldquo;little training&rdquo; going to face unstoppable Federal BLM agents and likely &ldquo;ending up dead.&rdquo; The SPLC insinuated that the movement was ineffective and in over its head.</p> <p>The reality was much the opposite. Liberty groups arrived in droves and were staunchly unified &mdash; not by a centralized leadership, but in defense of the basic moral principles outlined in the U.S. Constitution and Bill of Rights. Sources on the ground at the Bundy ranching operation relayed to me that at least 1,000 activists and militia members arrived over the weekend, with many more on the way. This one event proved certain points:</p> <ol> <li>The liberty movement is not afraid to put itself in harm&rsquo;s way for the right cause &mdash; even if this means facing off against highly armed government thugs.</li> <li>The liberty movement has the ability to field a response team or even an army anywhere in the country at any time within a couple of days.</li> <li>The liberty movement has the ability to change the course of events, even to the point of removing Federal agents from a region who are acting in an unConstitutional manner.</li> <li>The Federal government is not invincible, nor is it unfazed by liberty movement opposition. They worry about our strength and ability.</li> </ol> <p>Over the past weekend, we witnessed the true influence of the liberty movement. As thousands of activists and militia arrived in the area, the BLM finally began to understand what it was facing. The government agency that has been terrorized farming communities throughout the West for years, the agency armed with military-grade weaponry and hundreds of agents, ran away, as <a href="" target="_blank">freedom fighters</a> descended on the region.</p> <p>Nevada Governor Brian Sandoval and Clark County Sheriff Doug Gillespie, two politicians who were deathly silent during the beginning of the Federal incursion on the Bundy ranch, have now suddenly become vocal in defense of Nevada ranchers against the BLM. It&rsquo;s amazing how &ldquo;inspired&rdquo; politicians can become to do the right thing when they see an army of <a href="" target="_blank">liberty activists</a> marching against tyranny in their own backyard.</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="//" width="560"></iframe></p> <p>Not only was the BLM forced to remove itself from the area, but it was also forced to relinquish all the cattle it had stolen from Bundy over the course of the past week. Here, liberty groups close in on the cattle holding pens of the BLM and take back Bundy&rsquo;s property.</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="//" width="560"></iframe></p> <p>Statists are indignant and furious over the surrender of the BLM. The same people who boasted that liberty activists would be slaughtered by Fed agents are now frothing at the mouth because they did not get their massacre. Not only that, but the bureaucracy they worship has shown itself to be impotent in the face of Constitutional champions. All I can say is nothing puts a bigger grin on my face than to see statists cry like babies when their delusions of grandeur are trampled on.</p> <p>This was a major victory for the liberty movement. But let&rsquo;s be clear; the fight is just beginning.</p> <p>I suspect that the Bundy event will be spun by news agencies and the government until it is unrecognizable. They will claim that the BLM left not because they were wrong, but because they were trying to keep people safe. They will claim that liberty movement protesters were the aggressors and the poor BLM agents were just trying to do their jobs. They will play the race card as they always do, much like <a href="">this pathetically lazy and unprofessional article from Slate</a>, which asserts that if the Bundy&#39;s had been black, the Liberty Movement would have never supported them. They will argue the so-called Federal legality of the raid itself, and paint Bundy as a &ldquo;freeloader&rdquo; who refuses to pay taxes and who is living off the American people. They will do everything in their power to destroy the image of the victory and soil the name of the Bundy family.</p> <p>What they don&rsquo;t seem to understand, though, is that the liberty movement does not care what the Federal government deems &ldquo;legal&rdquo; or &ldquo;illegal.&rdquo; Our only interest is what is Constitutional and what is moral. The dispute was never about the &ldquo;legality&rdquo; of Bundy&rsquo;s use of the land, which his family used for grazing without interference for generations &mdash; until 1993, when the BLM used the absurd endangered species protection racket to put all of his neighbors out of business and threaten his ranch with invasion.&nbsp; Add to this the recently discovered fact that Senator Harry Reid&#39;s former assistant and friend <a href="">Neil Kornze is now head of the BLM</a> due to Reid&#39;s influence, and the fact that Harry Reid and his family are reaping financial rewards by driving farmers from all over the region where Cliven Bundy&#39;s ranch sits <a href="">while arranging land deals with Chinese solar companies</a>, and one has to ask, why should Bundy pay any of his hard earned money to the federal government when they are just going to use it to bulldoze his cattle and make Harry Reid more rich?</p> <p>Disinformation websites <a href="">like Snopes</a> contend that Reid&#39;s &quot;projects&quot; are not being established anywhere near the Bundy Ranch, yet, one such project has already been <a href="">launched only 35 miles south of Bundy</a>, and, the BLM has erased a page from its website specifically mentioning the Bundy Ranch and it&#39;s <a href="">&quot;interference&quot; with Dry Lake Solar Energy Zone Projects</a>, the same projects Harry Reid and his son are heavily involved in.</p> <p>What is amazing to me is that in light of this information hardcore socialists are still willing to defend Reid and the BLM.&nbsp; My question is, if the BLM is so innocent, then why are they erasing such data from their website at all?&nbsp; What were they trying to hide?</p> <p>Harry Reid has not responded to the facts behind his financial involvement in the BLM&#39;s attacks on Nevada farmers, except to say that they are &quot;conspiracy theories&quot;.&nbsp; He added when asked about the status of the confrontation:</p> <p><em><strong>&ldquo;Well, it&rsquo;s not over. We can&rsquo;t have an American people that violate the law and then just walk away from it. So it&rsquo;s not over...&rdquo; </strong></em></p> <p>Yes, Harry, it won&#39;t be over until men like you are thrown behind bars.</p> <p>Note that he says &quot;an American people&quot;; as if he is separate, as if he is referring to all of us as a subservient organism, or servant class.&nbsp; What Reid is saying is, the elites can&#39;t have &quot;an American people&quot; openly exposing their criminality and defying their tyranny, and then just walking away.&nbsp; I&#39;m sorry to break it to Reid, but that is exactly how all of this is going to end.</p> <p>Statists and bureaucrats like Reid continually attempt to argue this issue from the standpoint of Federal legality, obviously because the Federal government has the legislative and bureaucratic power to make any despicable action legal (at least on paper) if it wishes. However, the liberty movement has no interest whatsoever in Federal interpretations of legal precedence. We are only concerned with what is right. As the old saying goes, when injustice becomes law, rebellion becomes duty.</p> <p>The liberty movement also fully understands that the Bundy victory was only one battle at the beginning of a long war.</p> <p><strong>The BLM may very well be waiting for activists to leave the area before attacking again. </strong>And even if that is not the case, tyrannical systems have a way of attempting to make up for signs of weakness by escalating violence during the next siege. That is to say, we should expect the next event involving the BLM or other government agencies to be even more vicious than the Bundy incident. It is simply the natural inclination of totalitarian systems to exaggerate their power when their failings have been exposed.</p> <p>That said, it should be noted that <strong>corrupt leadership often crumbles in the face of steadfast resolve and courage.</strong> We have a long way to go before this Nation is once again truly free, but the liberty movement has proven its invaluable worth over the course of the past several days. We arrived at a crossroads, and we are now moving forward in the right direction &mdash; without fear and without regret. It is in these moments when history is made &mdash; when common men and women thwart the odds, defy the darkness and make good on their beliefs by risking everything in the name of freedom.</p> Bond Corruption Guest Post Reality Thu, 17 Apr 2014 22:23:43 +0000 Tyler Durden 487451 at If The Smart Money Is Selling, Who's Buying? <p>Based on Bloomberg's Smart Money Flow indicator, there is a very significant amount of distribution going on... the question is just who is soaking up the smart money selling? <em>Company buybacks, Johnny 5, or a greater-fool retail investor?</em></p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="318" /></a></p> <p>&nbsp;</p> <p>Perhaps this chart from Lance Roberts at STA Wealth provides some color for who?</p> <p><a href=""><img src="" width="548" height="372" /></a></p> <p>&nbsp;</p> <p>However, <strong>the idea that individual investors are still </strong><em><strong>"out of the market" should be taken with a bit of caution.</strong> The chart below is data compiled by the American Association of Individual Investors (AAII) which surveys it membership on portfolio allocation. &nbsp;The data is compiled and released monthly.&nbsp;</em></p> <p><em><br /></em></p> <p><em></em></p> <p class="title" style="text-align: justify;"> <a href="" target="_blank" class="highslide ageent-ru"><img src="" width="600" class="i_want_img5" /></a></p> <p>&nbsp;</p> <p>With cash hovering at the lowest levels since the <em>"Tech Wreck,"</em> and equity exposure at the highest,<strong> investors are more than just <em>"warming up"</em> to equities. They are effectively <em>"all in"</em> with respect to the financial markets.</strong></p> <p>&nbsp;</p> <p><em>Chart: Bloomberg</em></p> <p></p> <p>&nbsp;</p> Smart Money Thu, 17 Apr 2014 21:48:01 +0000 Tyler Durden 487450 at It's Time To Ditch The Consumer Price Index (CPI) <p><em>Submitted by Charles Hugh-Smith of <a href="">OfTwoMinds blog</a>,</em></p> <p><span style="-webkit-text-stroke-width: 0px; background-color: white; color: #404040; font-family: Verdana, sans-serif; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; orphans: auto; text-align: -webkit-left; text-indent: 0px; text-transform: none; white-space: normal; widows: auto; word-spacing: 0px;"><i>So why does the government maintain such a transparently inaccurate and misleading metric? For three reasons.</i></span></p> <p><span style="font-family: Verdana, sans-serif;"><b>That the official rate of inflation doesn&#39;t reflect reality is obvious to anyone paying college tuition and healthcare out of pocket.</b>&nbsp;The debate over the accuracy of the official consumer price index (CPI) and personal consumption expenditures (PCE--the so-called core rate of inflation) has raged for years, with no resolution in sight.</span></p> <p><span style="font-family: Verdana, sans-serif;">The CPI calculates inflation based on the prices of a basket of goods and services that are adjusted by hedonics, i.e. improvements that are not reflected in the price of the goods. Housing costs are largely calculated on equivalent rent, i.e. what homeowners reckon they would pay if they were renting their house.</span></p> <p><span style="font-family: Verdana, sans-serif;">The CPI attempts to measure the relative weight of each component:</span></p> <p><span style="font-family: Verdana, sans-serif;"><img align="middle" src="" style="border-width: 0px; border-style: solid; height: 359px; width: 601px;" /></span></p> <p><span style="font-family: Verdana, sans-serif;">Many argue that these weightings skew the CPI lower, as do hedonic adjustments. The motivation for this skew is transparent: since the government increases Social Security benefits and Federal employees&#39; pay annually to keep up with inflation (the cost of living allowance or COLA), a low rate of inflation keeps these increases modest.</span></p> <p><span style="font-family: Verdana, sans-serif;">Over time, an artificially low CPI/COLA lowers government expenditures (and deficits, provided tax revenues rise at rates above official inflation).</span></p> <p><span style="font-family: Verdana, sans-serif;">Those claiming the weighting is accurate face a blizzard of legitimate questions. For example, if healthcare is 18% of the U.S. GDP, i.e. 18 cents of every dollar goes to healthcare, then how can a mere 7% wedge of the CPI devoted to healthcare be remotely accurate?</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>In my analysis, the debate over inflation is intrinsically flawed.</b>&nbsp;What really matters is not the overall rate of inflation, which can be endlessly debated, but the&nbsp;<i>purchasing power of earned income, i.e. wages</i>&nbsp;and the&nbsp;<i>exposure to real-world costs</i>.</span></p> <p><span style="font-family: Verdana, sans-serif;">In other words, those households with zero exposure to college tuition and the full costs of daycare, medical care and healthcare insurance may well experience low inflation, while the household paying the full costs of daycare, college tuition and healthcare insurance will experience soaring inflation.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>Here&#39;s one example of how CPI fails to capture real-world inflation/loss of purchasing power.</b>&nbsp;Let&#39;s say an employee works for a company or agency that pays his/her healthcare insurance. The monthly cost has risen from $1,000/month to $1,500/month. The employee&#39;s wage has remained stagnant but the&nbsp;<i>total compensation costs</i>&nbsp;paid by the employer have gone up by $500/month.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>Now the employer shifts that $500/month to the employee</b>&nbsp;as their share of the healthcare insurance cost. Since the average full-time worker earns around $40,000 a year, and pays around 18% in taxes, their take-home pay is around $33,000 annually.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>The employee&#39;s co-pay of $6,000 a year ($500/month) represents 18% of their take-home wage.</b>&nbsp;This is an 18% reduction in earnings, or the equivalent of 18% inflation (i.e. a reduction in purchasing power).</span></p> <p><span style="font-family: Verdana, sans-serif;">This shifting of the skyrocketing burden of healthcare costs acts the same as 20% inflation, yet it doesn&#39;t even register in the current CPI.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>The geography of inflation doesn&#39;t register, either.</b>&nbsp;Soaring rents in Brooklyn, NY and the San Francisco Bay Area have a profound effect on those exposed to these rapidly rising costs, yet these impacts are massaged to zero by national CPI calculations.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>So once again we have a bifurcated society: those protected by the state from rising costs and those exposed to real-world reductions in purchasing power.</b>Households that receive government subsidies and direct payments have little exposure to real-world healthcare costs, since they are covered by Medicaid, and modest exposure to housing if they receive Section 8 benefits (Section 8 recipients pay 30% of their income for rent, regardless of the market price of the rental). Retirees on Medicare also have limited exposure to the real-world costs of their care paid by the government.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>If we analyze inflation by these two metrics, we find the middle class is increasingly exposed to skyrocketing real-world prices.</b>&nbsp;Pundits in the top 5% have the luxury of pontificating on the accuracy of the CPI while those protected by government subsidies and coverage have the luxury of wondering what all the fuss is about. Only those 100% exposed to the real costs experience the full fury of actual inflation.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>So why does the government maintain such a transparently inaccurate and misleading metric? For three reasons: 1) it is useful propaganda; 2) it suppresses the state&#39;s cost-of-living increases and 3) it lowers the government&#39;s cost of borrowing.</b>&nbsp;The benefits of reducing COLA adjustments are self-evident, as is the benefit of borrowing money at low rates of interest, but the propaganda benefits are more subtle.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>The key to enabling the endless printing of money that enriches the banks and the top .1% is low inflation.</b>&nbsp;Asset bubbles can be inflated, ballooning the wealth of the owners of the assets, as long as inflation is near-zero.</span></p> <p><span style="font-family: Verdana, sans-serif;">Indeed, the Federal Reserve claims it&nbsp;<i>must print money</i>&nbsp;to counter low inflation.</span><br /><span style="font-family: Verdana, sans-serif;"><b>Meanwhile, in the real economy, those exposed to the real costs of college tuition, healthcare, childcare, etc. are seeing their purchasing power evaporate like a puddle of water in Death Valley.</b>&nbsp;The Fed needs low inflation to justify its continuing enrichment of the financial elite, and the Federal government needs low inflation to keep its COLAs and borrowing costs low.</span></p> <p><span style="font-family: Verdana, sans-serif;">There are two ways to mask real-world reductions of purchasing power: 1) skew the CPI by distorting the component percentages, hedonics and how costs are measured, and 2) protect enough of the populace from real-world increases so they no longer care. Seniors, who famously vote in droves, have no idea what their Medicare benefits actually cost. As a result, they have no experience of healthcare inflation /reduction of purchasing power.</span></p> <p><span style="font-family: Verdana, sans-serif;">This works in all sorts of industries. As I have often mentioned here, the F-35 Lightning fighter aircraft costs in excess of $200 million each, roughly four times the cost of the F-18F it replaces. This extraordinary inflation is not experienced directly by the taxpayer who is paying for the boondoggle, as the Federal government borrows trillions of dollars to pay for such boondoggles, effectively passing the inflated costs on to future generations.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>These costs are hidden by the low cost of borrowing trillions to pay for boondoggles.</b>&nbsp;If real-world inflation is (say) 5%, then interest rates would typically adjust to a few points above that rate, to compensate capital for the erosion of purchasing power. If the Treasury had to pay 7% to borrow money, the interest cost would soon cripple Federal spending. People would be forced to focus on how all those trillions of dollars are being spent, and to whose benefit.</span></p> <p><span style="font-family: Verdana, sans-serif;">But with borrowing costs so low, nobody cares.</span></p> <p><span style="font-family: Verdana, sans-serif;"><b>The solution? One, abolish the Fed and let the market discover interest rates, and two, abandon the simplistic notion that one number of inflation has any meaning</b>&nbsp;in a complex economy with numerous subsets of exposure to market costs and the loss or gain of purchasing power.</span></p> <p><span style="font-family: Verdana, sans-serif;">Will we muster the will to look past failed models and metrics? Sadly, the answer is no. Why?</span></p> <p><span style="font-family: Verdana, sans-serif;">As I noted yesterday in&nbsp;<a href="" target="resource">What&#39;s the Difference Between Fascism, Communism and Crony-Capitalism? Nothing</a>,&nbsp;<b>a system set up to enrich political and financial elites is incapable of reform.</b>&nbsp;the only way the CPI will ever be replaced is when the Status Quo collapses in a heap of lies and insolvency. Until then, propaganda and gaming the system to protect vested interests will rule.</span></p> Borrowing Costs CPI ETC Federal Reserve Gross Domestic Product Medicare Personal Consumption Purchasing Power Reality Thu, 17 Apr 2014 21:12:09 +0000 Tyler Durden 487449 at Growth Rate China Slowest in 18 Months <p><a href="" style="font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 14px; line-height: 20px;">Follow ZeroHedge in Real-Time on FinancialJuice</a></p> <p><img src="" style="vertical-align: middle; max-width: 100%; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 14px; line-height: 20px;" /></p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">You know when you want to read that last page of the book just before you fall off into the Land of Nod and the Sandman comes and sandbags you to fall asleep? Or, when you really battle to keep your eyes open when you’ve paid for that seat at the theatre and the only thing you could do to stay awake is pop a couple of matchsticks in your eyeballs to keep them open? Well, it’s a bit like the China story over the slowdown in growth. Yawn! Yawn! It’s almost as boring as the US deficit. It’s there, nobody cares, because we will find a way out of it like printing money, taking over a country to exploit their oil or just laying the workers off so that we can save a dime or two. For the Chinese it’s the same. The West mainstream media revels in the scare-mongering tactics of telling us, ‘shock, horror; have you seen how bad the growth in China is today?’. We’ve been hearing it for years and it still seems to be way better than anything they can write home about in their own back yards in the USA.</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">So,&nbsp;<strong>China’s</strong>&nbsp;<strong>growth rate</strong>&nbsp;is the slowest it has been for the past&nbsp;<strong>18</strong>&nbsp;months in the first quarter of&nbsp;<strong>2014</strong>. So, the Chinese government may not reach their target of growth for this year set at&nbsp;<strong>7.5%</strong>. So, there was a drop from 7.7% in Gross Domestic Product in the last quarter of 2013. So, in comparison with last year there has been a year-on-year increase of 7.4%. It’s a lot better than some were predicting, hailing a massive drop to&nbsp;<strong>7.2</strong>%. That was wishful thinking by the West, wasn’t it? Less for them and more for us? Errhhm, maybe that’s the way it went in the past. But, it hasn’t been MOAR for the West for a long time now. Less for China will just mean more for other countries like India or Russia or Brazil.</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;"><strong>Chinese industrial production</strong>&nbsp;increased last month by&nbsp;<strong>8.8</strong>% year-on-year. That was above the&nbsp;<strong>February</strong>figure of&nbsp;<strong>8.6</strong>%. Economists had been targeting a&nbsp;<strong>9</strong>% increase. Isn’t it always funny that the figures that are provided are always forecast lower than they really are for growth and yet higher than they ever could be for industrial production? You don’t have to look very far as to why.</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;"><strong>Retail sales</strong>&nbsp;for China grew by&nbsp;<strong>12.2</strong>% in&nbsp;<strong>March</strong>&nbsp;year-on year and in&nbsp;<strong>February</strong>&nbsp;that growth stood at&nbsp;<strong>11.8</strong>%.</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">The big difference with the stimulus plan that the Chinese state is implementing and the&nbsp;<strong>Quantitative Easing</strong>of the&nbsp;<strong>Federal Reserve</strong>&nbsp;is that the latter just printed money aimlessly that took flight as far as it possible could from the USA to emerging countries to make the investment bankers richer. The Chinese are putting their money into projects including spending on railways and support for small companies. Say what you will, but if the Federal Reserve had had the common sense to invest at home rather than throwing the money to the banks, then we wouldn’t be in the sorry state that we are now. We might have actually improved the US industrial sector, given jobs to people and boosted the growth of the economy. The Chinese in their mini-stimulus will provide:</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">• <strong>Tax-breaks</strong>&nbsp;for small and micro companies (extended until&nbsp;<strong>2016</strong>).<br />• <strong>6.6</strong>&nbsp;thousand km (4.1 thousand miles) of new&nbsp;<strong>railway</strong>&nbsp;(an increase of 1 thousand on&nbsp;<strong>2013</strong>’s figure). Yes, massive engineering projects will boost their economy and increase employment and at the same time better infrastructure.<br />• A railway fund will be created of 200-300 billion Yuan ($32-48 billion) every year for development projects.<br />• There are plans to boost domestic consumption and employment (to be announced later in the year).</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">It’s not a patch on the $<strong>586</strong>&nbsp;billion that was invested in the economy to stimulate it in the aftermath of the financial crisis. Of course China’s growth is slowing down. It’s an economy that is out of the dizzy stages of youth and now entering maturity. It would be impossible to sustain growth of the levels that were experienced in the period prior to the financial crisis.</p> <p style="font-size: 14px; line-height: 20px; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;">Why should we expect more from them when we are doing nothing for ourselves?</p> <p style="font-family: 'Lucida Grande', Verdana, sans-serif; font-size: 13px; line-height: 17.333332061767578px;"><strong>Originally posted:&nbsp;</strong><strong style="font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif; font-size: 14px; line-height: 20px;"><a href="">Growth Rate China Slowest in 18 Months</a></strong></p> <p style="font-family: 'Lucida Grande', Verdana, sans-serif; font-size: 13px; line-height: 17.333332061767578px;"><span style="color: #1e439a; font-family: 'Helvetica Neue', Helvetica, Arial, sans-serif;"><span style="font-size: 14px; line-height: 20px;"><strong><a href="">Day Trading Data Sheets&nbsp;Futures and Forex</a></strong></span></span></p> <p style="font-family: 'Lucida Grande', Verdana, sans-serif; font-size: 13px; line-height: 17.333332061767578px;"><a href="" style="text-decoration: underline; color: #000000; line-height: 17.328125px;"><img src="" width="300" height="150" style="max-width: 100%; height: auto;" /></a></p> Brazil China Federal Reserve Gross Domestic Product India Yuan Thu, 17 Apr 2014 21:08:22 +0000 Pivotfarm 487448 at The Great Stock Buyback Craze Is Finally Ending <p>As we reported <a href="">last night</a>, whether as a result of Snowden revelations and NSA blowback by BRIC nations, or simply because the global economy is contracting far faster than rigged and manipulated markets worldwide will admit, IBM's Q1 revenues not only missed consensus earnings, but dropped to their lowest level since 2009. And yet, IBM stock is just shy off its all time highs and earnings per share have been flat if not rising during this period, leading even such acclaimed investors who never invest in tech companies as Warren Buffett to give IBM the seal of approval. How is that possible? </p> <p>Simple: as we <a href="">forecast first in 2012</a>, all that investment grade companies like IBM have done in the New Normal in order to preserve the illusion of growth, is to use cash from operations, or incremental zero-cost leverage, to fund stock buybacks with the express goal of reducing the number of shares, and hence dilution, in the EPS calculation. In essence a&nbsp;<em>balance sheet for income statement tradeoff</em>. Earlier today, <a href="">David Stockman touched just on this issue</a>.</p> <p>However, that "<em>great stock buyback craze</em>" as we call it, is finally coming to an end.</p> <p>Why? </p> <p>Before we explain, in order for readers to get a sense of the true perspective of how massive IBM's stock buybacks have been over the past two years, here is a chart showing the quarterly amount of net debt issued by Big Blue as well as the total notional in stock buybacks. </p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="435" /></a></p> <p>&nbsp;</p> <p>And yes, in the just completed quarter, <strong>IBM bought back a record $8+ billion of its own stock.</strong></p> <p>Before we proceed, for those wondering if IBM is allocating more cash to buybacks or capex, here is a quick and simple explanation. </p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="435" /></a></p> <p>As the chart above shows, since 2012, IBM has used roughly four times as much cash to spend on stock buybacks, as it has on capital expenditures. And not only IBM: this relationship is largely true of most investment grade companies. Incidentally, for anyone curious why there is no revenue growth, show them this chart. As long as corporate management teams seek to appease hedge fund raiders and activist shareholders who merely intend to use a company as a leveragable piggy bank vessel for a brief period of time, and buybacks explode at the expense of true investment in the future by way of capex, there simply can not be true organic growth. Period.</p> <p>Now going back to the original topic, here is the first chart above presented in the form of a snapshot in time, showing that since the start of 2012 nearly identical amounts have been spent to fund stock buybacks as has been raised through net debt issuance: some whopping $34 billion of buybacks to be precise.</p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="385" /></a></p> <p>&nbsp;</p> <p>Summarizing the chart above: in the past 2+ years, <strong>virtually every dollar in debt IBM has issued </strong>has gone for shareholder friendly actions (this chart does <em>not </em>include some $8.8 billion in dividends over the same time period).</p> <p>Which brings us to the topic at hand. While for a over a year, starting in 2012, IBM generated enough cash to where the incremental debt-funded buybacks did not result in a major change in the company's net leverage, starting about a year ago, organic cash flow declined so much that IBM had no choice but to see its net debt surge, and in fact since Q1 2012 has risen from $20 billion to nearly $35 billion, a 75% increase in just about two years!</p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="401" /></a></p> <p>&nbsp;</p> <p>But while net debt soaring is an unpleasant, if perfectly expected consequence of trying to mask income statement weakness with ever more debt, the piece de resistance is a chart showing IBM's Debt to Equity ratio. Because while a company can grow its debt indefinitely for a long time, unless it is also generating retained earnings, the party is ending. <strong>And as of this quarter, IBM's debt to equity ratio has risen to the highest on record, surpassing even the highs hit during the Lehman crisis</strong>! </p> <p>&nbsp;</p> <p><a href=""><img src="" /></a></p> <p>One can be certain that the rating agencies are certainly taking a long hard look at this massive jump and are currently wonder if and to what degree they should cut IBM's credit rating.</p> <p>Which, in turn, leaves Big Blue in a very unpleasant situation: should it continue buying back stock at record levels, all funded through new debt issuance, but at least preserving for one more quarter the illusion that EPS is stable and maybe even growing while revenues keep declining in the process risking the very basis of what allowed the company to kick the can for so long, its pristine credit rating, or should IBM finally throw in the towel, and instead preserve its balance sheet while allowing EPS to finally track revenue growth. Or lack thereof.</p> <p>Considering that for IBM its balance sheet is far more precious than its income statement and what its stock does over the near-term (all the more so since unlike many other companies it is not being accosted by random pesky hedge fund activists) especially since its price per share is just shy of all time highs, we can only assume that IBM will promptly slow down if not end outright, its stock buyback gimmick routine. First IBM, and then every other investment grade company that like Big Blue has postponed the day of income statement reckoning by unleashing record amounts of debt on what was once upon a time a pristine balance sheet.</p> <p>Which is naturally great news for those who are sick and tired of every form of manipulation and rigging big and small that has been plaguing the market ever since Bernanke made capital markets a policy vehicle for the Fed's central-planning mandate. Because once the buyback fraud is gone, and the crackdown on HFTs' market rigging and order frontrunning practices is complete, the only entity responsible for a criminally manipulated market will be none other than the Federal Reserve. Luckily, with Yellen in charge, it is only a matter of time before that final support of this epically-rigged travesty formerly known as the market, gives way and ushers in the grand reset so critical for restoring investor faith in what was once a real and fair marketplace.</p> Activist Shareholder Ben Bernanke Capital Expenditures Capital Markets Federal Reserve Global Economy Investment Grade Lehman New Debt Issuance New Normal None Rating Agencies Warren Buffett Thu, 17 Apr 2014 20:30:55 +0000 Tyler Durden 487447 at BTFDe-Escalation <p><strong>VIX-slamming, USDJPY-ramping, BTFDe-escalating muppetry </strong>and we end the week near the highs with the S&amp;P and Trannies comfortably green YTD (though notably underperforming gold still). <strong>Treasuries were sold hard today</strong> (7Y +10bps) as the D word was bandied about by the politicians (while in reality de-escalation was anything but what was happening), but the 5s30s still flattened modestly further. <strong>10Y saw one of its worst days of the year</strong> and yields pressed up to their 200DMA. <strong>Gold and silver were flat to modestly lower </strong>as copper and oil limped higher. FX markets were relatively calm as the <strong>USD pushed higher</strong> on the week (+0.5%). Stocks <strong>closed weak</strong> into the close but after 3 days of ramp, it&#39;s hardly surprising.</p> <p>&nbsp;</p> <p>It seems the President&#39;s less exuberant belief in the De-Escalation was not liked by the market...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>Another day another ramp job but a weaker close...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 282px;" /></a></p> <p>&nbsp;</p> <p>But from the US Open today things are not quite as exuberant...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>As we close this shortened week, YTD stocks remain laggards of bonds and gold...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>Year to date, the S&amp;P and Trannies are green but Nasdaq and Russell and Dow notably red still...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>USDJPY led stocks...but stocks close ugly...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>VIX was slammed...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>Treasuries were monkey-hammered today...across the curve</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>As a flattening yield curve is now the excuse to BTFD...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>and 10Y yields jammed higher to the 200DMA...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p>Credit does not seem as excited either about the &quot;d&quot; word...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 353px;" /></a></p> <p>&nbsp;</p> <p>In commodity land, safe haven PMs were sold and growthy excitment was bid...</p> <p><a href=""><img alt="" src="" /></a></p> <p>&nbsp;</p> <p><em>Charts: Bloomberg</em></p> <p><strong>Bonus Chart: Weibo stick-saved or the entire Alibaba derivative trade is fucked...</strong></p> <p><a href=""><img alt="" src="" /></a></p> Across the Curve Copper NASDAQ Reality Yield Curve Thu, 17 Apr 2014 20:05:33 +0000 Tyler Durden 487446 at President Obama Discusses Obamacare And The (De)Escalation - Live Feed <p>An impromptu press conference... on Obamacare but we are sure there'll be time to poke the bear...</p> <p>&nbsp;</p> <p><object width="480" height="300" data="" type="application/x-shockwave-flash"><param name="allowScriptAccess" value="always" /><param name="wmode" value="opaque" /><param name="bgcolor" value="#FFFFFF" /><param name="scale" value="showall" /><param name="quality" value="best" /><param name="align" value="l" /><param name="allowfullscreen" value="true" /><param name="play" value="false" /><param name="menu" value="false" /><param name="loop" value="false" /><param name="flashvars" value="player=;src=rtmp://;scaleMode=stretch&amp;link=;path_to_image=;width=480&amp;height=300" /><param name="src" value="" /></object></p> <!-- LIVE CHAT --><!-- LIVE CHAT --><div style="background-color: #282828; width: 480px; font-size: 10px; font-family: Arial, Helvetica, Sans-Serif;"> <div style="border-top: solid 1px #666666; margin: 0 10px; height: 40px; display: block;"> <div style="background: url( no-repeat; padding-top: 13px; height: 30px; float: left;"><a href="" style="text-decoration: none; color: #ababab; margin-left: 28px;">JOIN THE LIVE CHAT</a></div> <div style="padding-top: 13px; height: 30px; float: right;"><a href="" style="text-decoration: none; color: #ababab;">VISIT WHITEHOUSE.GOV</a></div> </div> </div> <!-- END LIVE CHAT --><!-- END LIVE CHAT --> Obamacare President Obama Thu, 17 Apr 2014 19:42:20 +0000 Tyler Durden 487445 at