http://www.zerohedge.com/fullrss2.xml en Hryvnia Rallies To 1-Month Highs After Ukraine Raises Benchmark Rate To 30% http://www.zerohedge.com/news/2015-03-03/hryvnia-rallies-1-month-highs-after-ukraine-raises-benchmark-rate-30 <p>Ukraine&#39;s infamous pink Porsche-driving central bank governor, Valeriya Gontareva, <strong>raised the nation&#39;s refinancing rate from 19.5% to a stunning 30%</strong> (effective Wednesday) in order to &quot;stabilize the situation in the money and lending markets,&quot; and imposed some <strong>&#39;capital controls&#39; on exporters holding foreign cash</strong>. For now, the hink to the highest rate since 2000 is having a positive effect as UAH has rallied 2-3 handles back to one-month highs against the USD - having lost over 60% of its value in the last year (though we note these are the &#39;official&#39; rates and may not represent actual UAH transactions in the real world). &quot;The central bank is trying to send a strong signal that it is in charge,&quot; noted on analyst as the country <strong>desperately waits for its $17.5bn bailout from <strike>US taxpayers</strike> The IMF</strong>.</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150303_UAH.jpg"><img height="313" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150303_UAH_0.jpg" width="600" /></a></p> <p>&nbsp;</p> <p><a href="http://www.bloomberg.com/news/articles/2015-03-03/ukraine-central-bank-increases-refinancing-rate-to-30-"><em>As Bloomberg reports,</em></a><strong> Ukraine&#39;s central bank is &ldquo;eager&rdquo; to strengthen the hryvnia toward the 21.7 per dollar average rate in the 2015 budget, which is important to ensure a board approval of the IMF loan next week...</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>Ukraine&rsquo;s central bank raised its benchmark interest rate to the highest since 2000 as policy makers struggle to curb a decline in the nation&rsquo;s currency and seek to move closer to obtaining an emergency loan.</p> <p>&nbsp;</p> <p><strong>The National Bank of Ukraine raised its refinancing rate to 30 percent from 19.5 percent, effective Wednesday, to &ldquo;stabilize the situation on the money and lending markets,&rdquo;</strong> Governor Valeriya Gontareva told reporters in Kiev. The regulator also retained a requirement for exporters to convert 75 percent of their foreign-currency revenue, helping the hryvnia strengthen 9.3 percent against the dollar.</p> <p>&nbsp;</p> <p>Ukraine is working to access an International Monetary fund loan to avert default after the war with pro-Russian separatists in the country&rsquo;s east helped wipe 15.2 percent off the economy last quarter compared with a year earlier. <strong>Authorities are also trying to prevent capital flight and stabilize the hryvnia, which has lost 60 percent against the dollar in the past year to become the world&rsquo;s worst-performing currency.</strong></p> <p>&nbsp;</p> <p>&ldquo;The rate hike will increase the appeal of holding hryvnias, so it will be a positive factor, but I&rsquo;m not sure that it alone will be enough to fix a rather acute deficit of dollar supply,&rdquo; Fyodor Bagnenko, a Kiev-based trader at Dragon Capital, said by e-mail. <strong>&ldquo;What&rsquo;s really needed in this situation is a combination of administrative and monetary measures -- and it seems like this is exactly what the central bank is doing.&rdquo;</strong></p> <p>&nbsp;</p> <p>All laws demanded by the IMF for the approval of a four-year $17.5 billion loan program have been adopted by lawmakers, Gontareva said.</p> <p>Ukraine&rsquo;s First Deputy Finance Minister Ihor Umanskyi said Feb. 27 that IMF funds will go into reserves, because &ldquo;it will be very difficult to douse the fire and panic without additional resources poured in.&rdquo;</p> </blockquote> <p>*&nbsp; *&nbsp; *</p> <p>So it would appear - by raising rates so dramatically, and choking off any hope of economic recovery - that <strong>the central bank is betting the netire nation&#39;s future on achieving the target FX rates that enable money to flow from The IMF...</strong></p> <p>Ironically, The IMF, at the same time, is drawing blood from Greece&#39;s stone (as it raids its pension funds to cover its debt).</p> <p>*&nbsp; *&nbsp; *</p> <p><strong>Ukraine credit risk remains the worst in the world...</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="960" height="500" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150303_UAH.jpg?1425389160" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-03/hryvnia-rallies-1-month-highs-after-ukraine-raises-benchmark-rate-30#comments default Greece International Monetary Fund recovery Ukraine Tue, 03 Mar 2015 13:26:31 +0000 Tyler Durden 502745 at http://www.zerohedge.com Frontrunning: March 3 http://www.zerohedge.com/news/2015-03-03/frontrunning-march-3 <ul> <li>3 days after <a href="http://www.zerohedge.com/news/2015-02-28/here-reason-why-stocks-just-had-their-best-month-october-2011">Zero Hedge</a>, here's Bloomberg: Company Cash Bathes Stocks as Monthly Buybacks Set Record (<a href="http://www.bloomberg.com/news/articles/2015-03-03/company-cash-bathes-stocks-as-monthly-buybacks-set-record">BBG</a>)</li> <li>Israel's Netanyahu to address Congress in speech that has strained ties with Obama (<a href="http://www.reuters.com/article/2015/03/03/us-usa-israel-idUSKBN0LZ0BS20150303">Reuters</a>), Risks Diplomatic, Political Pain If Speech Falls Flat (<a href="http://www.bloomberg.com/politics/articles/2015-03-03/netanyahu-risks-diplomatic-political-pain-if-speech-falls-flat">BBG</a>)</li> <li>Before Key Speech, Netanyahu Hails U.S. Ties (<a href="http://www.wsj.com/articles/u-s-s-power-u-s-israel-alliance-cannot-be-politicized-1425310411?mod=WSJ_hp_LEFTTopStories">WSJ</a>)</li> <li>$1.92 bilion FX rigging charge: Barclays Posts Loss as Foreign-Exchange Provisions Rise (<a href="http://www.wsj.com/articles/barclays-posts-full-year-loss-1425367979?mod=WSJ_hp_LEFTWhatsNewsCollection">WSJ</a>)</li> <li>Barclays Awards Jenkins First Bonus as CEO, Cuts Pay Pool (<a href="http://www.bloomberg.com/news/articles/2015-03-03/barclays-pays-jenkins-first-bonus-as-ceo-cuts-variable-pay-pool">BBG</a>)</li> <li>Exxon’s Russia Exposure Surges as Long View Outweighs Sanctions (<a href="http://www.bloomberg.com/news/articles/2015-03-03/exxon-s-russia-exposure-surges-as-long-view-outweighs-sanctions">BBG</a>)</li> <li>Obama says Iran must halt key nuclear work for at least a decade (<a href="http://www.reuters.com/article/2015/03/02/us-usa-obama-idUSKBN0LY2GA20150302">Reuters</a>)</li> <li>Yellen Turning from Friend to Foe for Dollar Bulls (<a href="http://www.bloomberg.com/news/articles/2015-03-03/dollar-bulls-undone-by-yellen-question-rally-s-legs-currencies">BBG</a>)</li> <li>Google to launch small US mobile network (<a href="http://www.ft.com/intl/cms/s/0/ba562796-c0e9-11e4-876d-00144feab7de.html">FT</a>)</li> <li>Jeff Immelt’s Overhaul of GE Impeded by Falling Oil Prices (<a href="http://www.wsj.com/articles/jeff-immelts-crude-problem-at-ge-1425382202?mod=WSJ_hp_RightTopStories">WSJ</a>)</li> <li>Iraqi forces try to seal off Islamic State around Tikrit (<a href="http://www.reuters.com/article/2015/03/03/us-mideast-crisis-iraq-idUSKBN0LZ10Q20150303">Reuters</a>)</li> <li>Best Buy to Buy Back Shares, Raise Dividends After Earnings Surge (<a href="http://www.wsj.com/articles/best-buy-to-buy-back-shares-raise-dividends-after-earnings-surge-1425385478?mod=WSJ_hp_LEFTWhatsNewsCollection">WSJ</a>)</li> </ul> <p>&nbsp;</p> <p><strong>Overnight Media Digest</strong></p> <p><em><span style="text-decoration: underline;">FT</span></em></p> <p>Google will launch its own mobile network in the United States, threatening the traditional carriers with competition if they don't innovate quickly to better improve Internet connectivity.</p> <p>According to a September 2013 audit report, the U.S. Office of Personnel Management's inspector general had warned Anthem of vulnerabilities in its computer system two years before online criminals broke into its records and stole personal information belonging to about 80 million people.</p> <p>Veteran investor Bill Gross has criticised the move by global economies to cut interest rates, opining that the move would hinder rather than help growth. "Low interest rates globally destroy financial business models that are critical to the functioning of modern day economies," Gross wrote.</p> <p>USA Today publisher Gannett Co Inc. has settled a corporate governance dispute with activist investor Carl Icahn ahead of its spin-off of its publishing arm. In January, Icahn, who holds a 6.6 percent interest in the company, alleged that the company's board might take steps to prevent the takeover of its publishing arm. </p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">NYT</span></em></p> <p>* Energy prices began falling last summer, but economists are stumped on what consumers are doing with the extra money. They are not shopping. One hint at what consumers might be thinking came Monday, when new government data on the economy showed a healthy gain for wages and salaries in January, even as spending by consumers inched lower for the second month in a row. (<a href="http://nyti.ms/1vWdAaD" title="http://nyti.ms/1vWdAaD">http://nyti.ms/1vWdAaD</a>)</p> <p>* The diverging prospects for JPMorgan's biggest businesses are reflective of a split within the broader financial industry. (<a href="http://nyti.ms/1Ge1ayq" title="http://nyti.ms/1Ge1ayq">http://nyti.ms/1Ge1ayq</a>)</p> <p>* How Etihad Airways runs and is financed are central in a fight with airlines in the United States, which accuse Persian Gulf carriers of stealing passengers. (<a href="http://nyti.ms/1Ckyi6u" title="http://nyti.ms/1Ckyi6u">http://nyti.ms/1Ckyi6u</a>)</p> <p>* A growing number of the wealthy British residents do not have to pay tax on their foreign income or assets, thanks to an Edwardian-era law. (<a href="http://nyti.ms/1wO95dA" title="http://nyti.ms/1wO95dA">http://nyti.ms/1wO95dA</a>)</p> <p>* A little over a month ago, Carl Icahn seemed poised for a fight at the Gannett Co Inc. Now, the veteran activist investor is backing down. Gannett disclosed on Monday that Icahn had withdrawn his two nominees for its board, as well as his corporate governance proposals that would have made it easier to sell the media company. (<a href="http://nyti.ms/1Nb2pAp" title="http://nyti.ms/1Nb2pAp">http://nyti.ms/1Nb2pAp</a>)</p> <p>* Convicted in 2005 of looting nearly $100 million from Tyco International, L. Dennis Kozlowski was the face of Wall Street gluttony. Now a free man, he speaks for the first time of his more modest life. (<a href="http://nyti.ms/1AtyysV" title="http://nyti.ms/1AtyysV">http://nyti.ms/1AtyysV</a>)</p> <p>* Under a government crackdown on for-profit schools that leave students with useless credentials and punishing debt, some colleges have converted to nonprofits, in lucrative deals. (<a href="http://nyti.ms/1wO8gBw" title="http://nyti.ms/1wO8gBw">http://nyti.ms/1wO8gBw</a>)</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Canada</span></em></p> <p>THE GLOBE AND MAIL</p> <p>** The Canadian government is actively searching for a new top military commander to succeed General Tom Lawson after he asked that his three-year appointment not be extended. (bit.ly/1AAJp4j)</p> <p>** Oxford Properties Corp and Ivanhoe Cambridge Inc, two of the country's largest landlords have moved quickly to snap up 11 of their best leases from insolvent Target Canada for what it describes as a premium price, underlining their urgency to take back control of their retail space. (bit.ly/1wLOzKz)</p> <p>&nbsp;<br />** For a new advertising campaign for McDonald's Canada, launched on Monday evening, a small film crew crisscrossed the country interviewing more than 450 McDonald's customers, staff, and suppliers. Some of those people will be the face of the "Welcome to McDonald's" campaign. (bit.ly/1vXqx4d)</p> <p>NATIONAL POST</p> <p>** Ottawa's bumpy mission to foster fiercer wireless competition across the country is set to reach a climax when Industry Canada reveals the results of the AWS-3 spectrum auction to be held on Tuesday. (bit.ly/1EdoTww)</p> <p>** Two transactions in Toronto that saw institutional buyers swoop in and make offers to condo developers for entire buildings, squeezing out all the small-time investors, have caught the eye of people in the high-rise industry. (bit.ly/1EJ1eVq)</p> <p>** Refugee immigrants are reporting higher incomes to the Canada Revenue Agency than investor-class immigrants, according to data compiled by Citizenship and Immigration Canada. The rate of investor immigrants reporting any income whatsoever is far below the Canadian average. (bit.ly/1DCZ5pM)</p> <p>** Concerns that arms could end up "in the hands of extremists" made Ottawa reluctant to support the Syrian opposition in the aftermath of the August 2013 chemical weapons attack in Damascus, newly released documents show. (bit.ly/1AALmOa)</p> <p>** The Ontario government has opened the possibility of appealing a court ruling, which allowed a young aboriginal girl with leukemia to abandon chemotherapy, after an unusual, belated decision to get involved in the contentious case. (bit.ly/1EdyCTu)</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">China</span></em></p> <p>CHINA SECURITIES JOURNAL</p> <p>- China's banking industry should accelerate the transformation of the way it makes profits, improve innovation capacity and further develop risk-control management in order to better adapt to the "new normal" of the Chinese economy, Shang Fulin, president of the China Banking Regulatory Commission, wrote in a state-owned magazine recently.</p> <p>- The revenue and profits made by 421 companies on Shenzhen's ChiNext board, China's Nasdaq-style board of high-growth companies, hit a three-year high in 2014, according to company results posted on the exchange website.</p> <p>SECURITIES TIMES</p> <p>- China Vanke Co Ltd, the nation's biggest property developer, denied a rumor that the company plans to lay off staff to improve profits amid the ailing property market.</p> <p>SHANGHAI SECURITIES NEWS</p> <p>- Starting April 1, all Chinese trust companies are required to allocate one percent of their total assets to a trust insurance fund, the paper reported citing a recent internal statement circulated by the China Banking Regulatory Commission. The trust was set up to reduce financial risk in shadow banking.</p> <p>- China has imposed a total of 72.3 million yuan ($11.53 million) of fines in 136 environment pollution cases since the revision of the environmental law, said Pan Yue, vice-minister of the Ministry of Environmental Protection.</p> <p>CHINA DAILY</p> <p>- Attempts to promote a separatist agenda in the Hong Kong Special Administrative Region will be futile, according to an editorial in the official paper. It will only lead the city to a political and economic dead end, said the editorial.</p> <p>&nbsp;</p> <p><em><span style="text-decoration: underline;">Britain</span></em></p> <p>The Times</p> <p>HOUSE PRICES FALL FOR FIRST TIME IN FIVE MONTHS</p> <p>House prices fell for the first time in five months in February as the property market slowed more sharply than expected, according to figures from Nationwide. (<a href="http://thetim.es/18fVfua" title="http://thetim.es/18fVfua">http://thetim.es/18fVfua</a>)</p> <p>UK MANUFACTURING HITS SEVEN-MONTH HIGH</p> <p>The UK's manufacturing output has reached a seven-month high in the latest sign that the economy is gathering pace after a slowdown towards the end of last year. (<a href="http://thetim.es/1BQ8UWH" title="http://thetim.es/1BQ8UWH">http://thetim.es/1BQ8UWH</a>)</p> <p>The Guardian</p> <p>THOUSANDS MISS FIRST SECONDARY SCHOOL CHOICE AS DEMAND RISES ACROSS UK CITIES</p> <p>Tens of thousands of children have missed out on their first choice of secondary school this year as pressure on places mounts, with almost half failing to get into their top preference in some areas of London. (<a href="http://bit.ly/1aJagGB" title="http://bit.ly/1aJagGB">http://bit.ly/1aJagGB</a>)</p> <p>MPS CALL FOR END TO INDEFINITE DETENTION OF MIGRANTS</p> <p>A cross party-group of MPs has called for an end to the indefinite detention of migrants, warning that too many people are being unnecessarily detained, sometimes for as long as four years, under a system they characterise as "expensive, ineffective and unjust". (<a href="http://bit.ly/1NadIc7" title="http://bit.ly/1NadIc7">http://bit.ly/1NadIc7</a>)</p> <p>The Telegraph</p> <p>CO-OP BANK EXECUTIVE LEAVES IN LATEST HIGH-PROFILE EXIT</p> <p>A senior executive at the Co-operative Bank has left the company after little more than a year, in the latest high-profile departure from the troubled bank. (<a href="http://bit.ly/1zBKqJh" title="http://bit.ly/1zBKqJh">http://bit.ly/1zBKqJh</a>)</p> <p>RUSSIANS TO FIGHT UK'S NORTH SEA GASFIELDS DECISION</p> <p>A group of billionaire Russian investors plans to challenge a UK decision to block their attempt to seize control of a clutch of North Sea gasfields worth billions. (<a href="http://bit.ly/1vVoSfq" title="http://bit.ly/1vVoSfq">http://bit.ly/1vVoSfq</a>)</p> <p>Sky News</p> <p>STANCHART RISKS REIGNITING BANK BONUS ROW</p> <p>The emerging markets bank Standard Chartered Plc will risk reigniting a row over City bonuses this week when it reveals that it is cutting bonuses by a smaller percentage than its decline in profits. (<a href="http://bit.ly/1GJAiUt" title="http://bit.ly/1GJAiUt">http://bit.ly/1GJAiUt</a>)</p> <p>TWO-THIRDS OF 'CHESHUNT NINE' LEAVE TESCO</p> <p>Two-thirds of the executives suspended over Tesco Plc's 263 million stg profits overstatement scandal have left the supermarket giant. (<a href="http://bit.ly/18hpK2N" title="http://bit.ly/18hpK2N">http://bit.ly/18hpK2N</a>)</p> <p>The Independent</p> <p>LLOYDS TO PAY FIRST DIVIDEND SINCE 2008 BAILOUT</p> <p>Lloyds Banking Group, which is backed by the taxpayer, is to pay its first dividend since 2008 as its chief executive collected a 7.4 million stg bonus. (<a href="http://ind.pn/1LQmPNv" title="http://ind.pn/1LQmPNv">http://ind.pn/1LQmPNv</a>)</p> <p></p> <p>&nbsp;</p> <p><strong>Fly On The Wall Pre-Market Buzz</strong></p> <p>ECONOMIC REPORTS</p> <p>No major domestic economic reports scheduled for today.</p> <p>ANALYST RESEARCH</p> <p>Upgrades<br />Citi (C) upgraded to Overweight from Neutral at JPMorgan<br />DURECT (DRRX) upgraded to Buy from Hold at Cantor<br />LabCorp (LH) upgraded to Buy from Hold at Canaccord<br />NXP Semiconductors (NXPI) upgraded to Neutral from Sell at Goldman<br />Quest Diagnostics (DGX) upgraded to Buy from Hold at Canaccord</p> <p>Downgrades</p> <p>AK Steel (AKS) downgraded to Neutral from Buy at Nomura<br />American Express (AXP) downgraded to Underperform from Neutral at Macquarie<br />Cerner (CERN) downgraded to Hold from Buy at Topeka<br />Fifth Third (FITB) downgraded to Market Perform from Outperform at Keefe Bruyette<br />Freescale (FSL) downgraded to Neutral from Overweight at Piper Jaffray<br />KBR (KBR) downgraded to Hold from Buy at Jefferies<br />LTC Properties (LTC) downgraded to Neutral from Buy at Mizuho<br />MannKind (MNKD) downgraded to Sell from Neutral at Goldman<br />Mavenir Systems (MVNR) downgraded to Hold from Buy at Deutsche Bank<br />Medifast (MED) downgraded to Underperform from Neutral at BofA/Merrill<br />Micron (MU) downgraded to Neutral from Buy at Nomura<br />PVH Corp. (PVH) downgraded to Neutral from Conviction Buy at Goldman<br />U.S. Steel (X) downgraded to Neutral from Buy at Nomura<br />Vivendi (VIVHY) downgraded to Underperform from Hold at Jefferies<br />Yum! Brands (YUM) downgraded to Neutral from Outperform at RW Baird</p> <p>Initiations</p> <p>Easterly Government Properties (DEA) initiated with an Outperform at RBC Capital<br />Hilton (HLT) initiated with an Outperform at RBC Capital<br />MPLX (MPLX) initiated with a Hold at Evercore ISI<br />Marriott (MAR) initiated with an Outperform at RBC Capital<br />Nexvet Biopharma (NVET) initiated with an Outperform at JMP Securities<br />Shell Midstream (SHLX) initiated with a Buy at Evercore ISI<br />Starwood (HOT) initiated with a Sector Perform at RBC Capital<br />Sunoco Logistics (SXL) initiated with a Hold at Evercore ISI<br />Syneron Medical (ELOS) initiated with a Buy at Brean Capital<br />Tesoro Logistics (TLLP) initiated with a Buy at Evercore ISI<br />Valero Energy Partners (VLP) initiated with a Buy at Evercore ISI<br />Vista Outdoor (VSTO) initiated with a Buy at CRT Capital</p> <p>COMPANY NEWS</p> <p>Boise Cascade (BCC) announces 2M share repurchase program<br />Bristol-Myers (BMY) reports hepatitis C cure rate of 97% in study&nbsp; <br />Cisco (CSCO), Telecom Italia announce intent to enter cloud services agreement<br />Citi (C) confirms sale of OneMain Financial To Springleaf to $4.25B<br />FMC Corporation's (FMC) sale of Alkali business to Tronox clears antitrust review<br />Intuitive Surgical (ISRG) awarded $430M government contract<br />Jiayuan.com (DATE) receives 'going private' proposal<br />Macau reports February casino revenue down 48.6% to 19.54B patacas<br />Ocwen (OCN) hired Moelis, Barclays to explore strategic options<br />Ocwen (OCN) not anticipating any material fines from regulators<br />Petrobras (PBR) announces $13.7B two-year divestment plan<br />Pluristem (PSTI) announce data showing PLX-R18 cells improve bone marrow transplant<br />STAAR Surgical (STAA) appoints Caren Mason as CEO<br />Salix (SLXP) discloses internal probe of disclosures of wholesaler inventory levels<br />Scientific Games (SGMS) signs contract with ALC to provide lottery game system<br />SunOpta (STKL) announces $30M share repurchase program</p> <p>EARNINGS</p> <p>Companies that beat consensus earnings expectations last night and today include:<br />Tarena (TEDU), Avolon (AVOL), Stage Stores (SSI), JD.com (JD), Nortek (NTK), Halozyme (HALO), Puma Biotechnology (PBYI), Meadowbrook Insurance (MIG), Acura Pharma (ACUR), Diplomat Pharmacy (DPLO), Altisource (ASPS), Opower (OPWR), Intrexon (XON), DTS, Inc. (DTSI), MBIA (MBI), Guidewire (GWRE), McDermott (MDR), Fox Factory (FOXF), DURECT (DRRX), Matador (MTDR), Everyday Health (EVDY), Nutrisystem (NTRI), IGI Laboratories (IG), RigNet (RNET), Palo Alto (PANW), CNinsure (CISG), Epiq Systems (EPIQ), Chuy's (CHUY)</p> <p>Companies that missed consensus earnings expectations include:<br />SunOpta (STKL), Nabors Industries (NBR), FS Investment (FSIC), Compass Diversified (CODI), Baltic Trading (BALT), Mid-Con Energy (MCEP), New Mountain Finance (NMFC), Cumulus Media (CMLS), Sanchez Energy (SN), Aerie Pharmaceuticals (AERI), Arena Pharmaceuticals (ARNA), Carmike Cinemas (CKEC), Salix (SLXP), Caesars Acquisition (CACQ), Caesar's (CZR), Portfolio Recovery (PRAA), DXP Enterprises (DXPE)</p> <p>Companies that matched consensus earnings expectations include:<br />KYTHERA (KYTH), Chimera (CIM), Revance (RVNC), Mylan (MYL)</p> <p>NEWSPAPERS/WEBSITES</p> <p>Apple (AAPL)-Google (GOOG) proposed $415M settlement headed towards approval, Reuters says<br />Judge pauses attorney general piracy probe against Google (GOOG), AP says<br />Obama task force on police doesn't call for body cameras (TASR, DGLY), NY Times says<br />Taiwan orders Alibaba (BABA) to withdraw from country, Financial Times reports<br />Toyota (TM) promises to stay profitable in Russia, Financial Times reports</p> <p>SYNDICATE</p> <p>Callidus Software (CALD) files to sell 4M shares of common stock<br />Concert Pharmaceuticals (CNCE) files $125M mixed securities shelf<br />Diamond Resorts (DRII) files to sell 4.83M shares for holders<br />General Finance Corp (GFN) files to sell 4.4M shares of common stock<br />Harman (HAR) files to sell 839,673 shares of common stock for holders<br />Heartland Express (HTLD) files to sell 3.25M shares of common stock for holders<br />Markel (MKL) files automatic mixed securities shelf<br />NorthStar Asset Management (NSAM) files automatic mixed securities shelf<br />Northstar Realty (NRF) files to sell 60M shares of common stock<br />Oaktree Capital (OAK) files to sell 4M Class A units<br />Pfizer (PFE) files automatic mixed securities shelf<br />Santander Consumer (SC) files to sell 245.6M shares for holders<br />TESARO (TSRO) files to sell $150M of common stock<br />Taylor Morrison (TMHC) files to issue 1.4M shares of Class A stock to holders</p> <p></p> http://www.zerohedge.com/news/2015-03-03/frontrunning-march-3#comments American Express Apple Barclays Best Buy Bill Gross Carl Icahn China CSCO Deutsche Bank Evercore Gannett GOOG Google Hong Kong Iran Keefe Lloyds Merrill New Normal Nomura NRF Oaktree recovery Reuters Shadow Banking Standard Chartered Starwood Toyota Tronox Yuan Tue, 03 Mar 2015 13:05:30 +0000 Tyler Durden 502744 at http://www.zerohedge.com Hillary Clinton's Latest Scandal: Former SecState Exclusively Used Undocumented, Personal Email Account http://www.zerohedge.com/news/2015-03-03/hillary-clintons-latest-scandal-former-secstate-used-personal-email-exclusively-comm <p>While the Hillary Clinton campaign seems unperturbed by recent problematic <a href="http://www.politico.com/magazine/story/2015/03/clinton-foundation-eric-braverman-115598.html#.VPWjyPnF9PI">disclosures by Politico </a>into the Hillary Clinton Foundation, the former first lady and current democrat presidential hopeful will have a field day explaining why, as the <a href="http://www.nytimes.com/2015/03/03/us/politics/hillary-clintons-use-of-private-email-at-state-department-raises-flags.html?hp&amp;action=click&amp;pgtype=Homepage&amp;module=first-column-region&amp;region=top-news&amp;WT.nav=top-news&amp;_r=0">NYT reported overnight</a>, Hillary - in her role as Secretary of State - "<strong>exclusively used a personal email account to conduct government business</strong>" according to State Department officials in violation of "federal requirements that officials’ correspondence be retained as part of the agency’s record."</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Mrs. Clinton did not have a government email address during her four-year tenure at the State Department. <strong>Her aides took no actions to have her personal emails preserved on department servers at the time, as required by the Federal Records Act.</strong></p> </blockquote> <p>Why is this a deeply troubling breach of protocol, not to say a substantial threat to national security by America's former top diplomat? For starter, using Hotmail or Aol instead of a protected, encrypted government address leaves little to the hacker's imagination.&nbsp; But what's worse is that as a result of exclusive reliance on non-government platforms, which have no document retention policy and in fact have a "straight to trash" policy, any and all emails regarding the Benghazi scandal, many of which were FOIAed, could have been and were simply deleted without ever leaving a trace. Or as NSA Nate summarized:</p> <blockquote class="twitter-tweet" lang="en"><p><a href="https://twitter.com/hashtag/FOIA?src=hash">#FOIA</a> <a href="http://t.co/jXycJI5QAd">pic.twitter.com/jXycJI5QAd</a></p> <p>— NSA Nate (@NSANate) <a href="https://twitter.com/NSANate/status/572592891094306816">March 3, 2015</a></p></blockquote> <script src="//platform.twitter.com/widgets.js"></script><p>Even the left-leaning NYT couldn't find the appropriate damage control spin to an action that would lead many to question her common sense sensibilities as a future president:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Her expansive use of the private account was alarming to current and former National Archives and Records Administration officials and government watchdogs, who called it a serious breach.</p> <p>&nbsp;</p> <p>“It is very difficult to conceive of a scenario — short of nuclear winter — where an agency would be justified in allowing its cabinet-level head officer to solely use a private email communications channel for the conduct of government business,” said Jason R. Baron, a lawyer at Drinker Biddle &amp; Reath who is a former director of litigation at the National Archives and Records Administration.</p> </blockquote> <p>In other words, nothing Clinton did for four years has a paper trail mandated of any and all other civil servants. </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Under federal law, however, letters and emails written and received by federal officials, such as the secretary of state, are considered government records and are supposed to be retained so that congressional committees, historians and members of the news media can find them. There are exceptions to the law for certain classified and sensitive materials.</p> <p>&nbsp;</p> <p>“I can recall no instance in my time at the National Archives when a high-ranking official at an executive branch agency solely used a personal email account for the transaction of government business,” said Mr. Baron, who worked at the agency from 2000 to 2013.</p> </blockquote> <p>That, and the clear security threat:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Mr. Blanton said high-level officials should operate as President Obama does, emailing from a secure government account, with every record preserved for historical purposes. <strong>“Personal emails are not secure,” he said. “Senior officials should not be using them.”</strong></p> </blockquote> <p>But why this "<em>deus ex</em>" could not have come at a better time for the GOP: "Regulations from the National Archives and Records Administration at the time required that any emails sent or received from personal accounts be preserved as part of the agency’s records. As the NYT adds "others who, like Mrs. Clinton, are eyeing a candidacy for the White House are stressing a very different approach. Jeb Bush, who is seeking the Republican nomination for president, <em>released a trove of emails in December from his eight years as governor of Florida.</em>"</p> <p>Things get worse when looking at the initial response by the flailing Clinton camp, who <em>said it was not her responsibility </em>to keep a track of the emails: someone else would - after all for every email there is a sender and recipient:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Mr. Merrill, the spokesman for Mrs. Clinton, declined to detail why she had chosen to conduct State Department business from her personal account. He said that because Mrs. Clinton had been sending emails to other State Department officials at their government accounts, she had “<strong>every expectation they would be retained</strong>.” He did not address emails that Mrs. Clinton may have sent to foreign leaders, people in the private sector or government officials outside the State Department.</p> </blockquote> <p>And this: "A spokesman for Mrs. Clinton, Nick Merrill, defended her use of the<br /> personal email account and said she has been complying with the “letter<br /> and spirit of the rules.”"</p> <p>Well, no. She failed to comply with rules in every possible form. </p> <p>Finally, how was the deeply damaging discovery made?</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>The existence of Mrs. Clinton’s personal email account was discovered by a House committee investigating the attack on the American Consulate in Benghazi as it sought correspondence between Mrs. Clinton and her aides about the attack.</p> <p>&nbsp;</p> <p>Two weeks ago, the State Department, after reviewing Mrs. Clinton’s emails, provided the committee with about 300 emails — amounting to roughly 900 pages — about the Benghazi attacks.</p> </blockquote> <p>So surely she will release all the emails into the public domain now, especially with the Benghazi investigation still ongoing? Well no.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Mrs. Clinton and the committee declined to comment on the contents of the emails or whether they will be made public.</p> </blockquote> <p>All of which begs the question: when third party citizens demanded FOIA production of Clinton's emails, related to Benghazi or otherwise, <a href="https://www.muckrock.com/foi/united-states-of-america-10/hillary-rodham-clinton-email-search-180/#files">such as Muckrock's Jason Smathers here, </a>just what was the Department of Homeland Security's Privacy Office looking at when deciding it would deny said request?</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/03/DHS%20hillary.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/03/DHS%20hillary_0.jpg" width="600" height="805" /></a></p> <p>It also explains why the DHS is so desperate for funding: otherwise, how will the massive government agency sort through <em><strong>non-existant </strong></em>emails to fabricate a reason why they can't be produced in response to "Freedom of Information" requests?</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="499" height="270" alt="" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/Hillary%20foia.jpg?1425385680" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-03/hillary-clintons-latest-scandal-former-secstate-used-personal-email-exclusively-comm#comments Florida FOIA Merrill national security Nomination President Obama Twitter Twitter White House Tue, 03 Mar 2015 12:32:58 +0000 Tyler Durden 502743 at http://www.zerohedge.com Market Wrap: Futures Decline; Treasurys Weak On Actavis Mega-Deal, Dollar At 12 Year High http://www.zerohedge.com/news/2015-03-03/market-wrap-futures-decline-treasurys-weak-actavis-mega-deal-dollar-12-year-high <p>With little newsflow out of Europe, and just as little on deck out of the US (just NY ISM and auto sales later today), the main overnight events were out of Asia where first the RBA decided to leave rates unchanged (despite the majority calling for a rate cut) when as Bloomberg's Richard Breslow noted, in the RBA communique the central bank "changed their reference to China from “China’s growth was in line with expectations” to “China’s growth will slow a little from last year’s outcome.” Whatever may be happening with China, one thing is clear - either the RBA announcement was leaked a minute early, or HFT algos took a huge gamble and soared higher up to a minute earlier (more shortly). </p> <p>Speaking of China, the rate-cut euphoria lasted just one day, and after a feeble 0.8% bounce on Monday, the SHCOMP was down 2.2% this morning over fears the PBOC is doing too little, too late to halt what is now perceived by many as a massive "tightening" capital flight out of China. Finally, Japan made the newsflow, after it JGBs continued to slide following a weak auction, fears that the BOJ is done easing after Abe advisor Etsuro Honda warned against overheating, and after the biggest jump in base pay in over a decade led some to think the BOJ may soon have to halt easing altogether, especially if real wages proceed to rise.</p> <p>Another notable development is the ongoing weakness in US rates even as the ECB-buying backstop has made selling of rates in Europe virtually illegal. The weakness in the US 10Y however can be almost entirely attributed to the "mammoth" Actavis-Allergan issue, which is now said to be more than 4x oversubscribed, with nearly $90 billion in orders for just over $20 billion in paper. The result is weakness for matched Treasurys due to rate locks: as InTouch David Fuller's writes watch for “late rate lock unwinds into/out of pricing” though it depends on how big rate lock was Feb. 26 and “whether end-users buy it outright or vs USTs." Once this latest mega issue is absorbed expect the convergence trade to resume.</p> <p>Wrapping up the key moves, the dollar index rose modestly to 95.53 this morning, hitting the highest since 2003, as further easing pressure builds on banks around the world as the US marches along to what is seen by many as a de minimus rate hike come hell, high water, or any economic data whatsoever.</p> <p>European equities currently reside in modest positive territory in what has been yet another session so far which has been relatively void of pertinent newsflow from the Eurozone. On a sector specific basis, financial names have been placed under some minor pressure in the wake of Barclay’s (-2.8%) pre-market report whereby the Co. increased their provisions for the FX probe by GBP 500mln and said they could not be certain over whether they would need to set aside further provisions. From a fixed income perspective, Bunds initially saw a subdued first half of the session in tandem with the rangebound performance seen across European equities with participants still monitoring the ongoing negotiations between Greece and their Eurozone counterparts with European Commission President Juncker suggesting that a third bailout for Greece has not been discussed. Heading into the North American crossover, Bunds and USTs saw a modest downtick with volumes in the Bund rolling from the March contract to June, while Finland has also opened books on its EUR 3bln 2031 offering. Additionally, Actavis' mammoth nine-part offering is expected to be priced today, with the size of the issuance expected to be in excess of USD 22bln. Note, this placed downward pressure on USTs heading into the close yesterday.</p> <p>In FX markets, AUD has managed to hold onto its gains seen overnight after the RBA unexpectedly left its Cash Rate Target steady at 2.25%. Nonetheless, the central bank also signalled further easing by saying it may be appropriate over the period ahead, which capped further AUD gains. Elsewhere, USD-index has recovered off its worst levels amid no fundamental news, although USD/JPY remains in negative territory following comments from Japanese PM Advisor Honda who also said current USD/JPY levels are a kind of an upper limit in the exchange rate’s comfort zone. GBP was granted a brief spell of reprieve following the latest UK construction PMI reading which exceeded expectations (60.1 vs. Exp. 59.1), however, GBP remains relatively unchanged against the Greenback.</p> <p>In the commodity complex, spot gold resides in modest positive territory, reversing some of the losses seen during yesterday’s session alongside the strength in US equities. Elsewhere, Copper prices pulled further back from their 7-week highs as Chinese risk sentiment was dampened on IPO concerns after China’s securities regulator approved 24 IPO’s which could lock up a record value of CNY 3trl. In energy markets, both Brent and WTI crude futures trade in the green ahead of the after-market API inventory release with energy newsflow overall relatively light.</p> <p><em><strong>In summary: </strong></em>European shares remain higher, though off intraday highs, with the food &amp; beverage and personal &amp; household sectors outperforming and financial services, banks underperforming. RBA leaves rates unchanged, Australian dollar rises. Swiss economy grew faster than forecast before franc cap removal. The French and Italian markets are the best-performing larger bourses, Swedish the worst. The euro is weaker against the dollar. Japanese 10yr bond yields rise; French yields increase. Commodities gain, with natural gas, copper underperforming and Brent crude outperforming. U.S. ISM New York, vehicle sales, IBD/TIPP economic optimism,&nbsp; due later.</p> <p><strong>Market Wrap</strong></p> <ul> <li>S&amp;P 500 futures down 0.1% to 2112.5</li> <li>Stoxx 600 up 0.2% to 392.2</li> <li>US 10Yr yield up 2bps to 2.1%</li> <li>German 10Yr yield up 1bps to 0.37%</li> <li>MSCI Asia Pacific up 0.1% to 146.3</li> <li>Gold spot up 0.1% to $1208.2/oz</li> <li>56% of Stoxx 600 members gain, 42% decline</li> <li>Eurostoxx 50 +0.2%, FTSE 100 +0.1%, CAC 40 +0.3%, DAX +0.2%, IBEX -0.1%, FTSEMIB +0.2%, SMI -0.1%</li> <li>Asian stocks little changed with the Sensex outperforming and the Shanghai Composite underperforming.</li> <li>MSCI Asia Pacific up 0.1% to 146.3</li> <li>Nikkei 225 down 0.1%, Hang Seng down 0.7%, Kospi up 0.2%, Shanghai Composite down 2.2%, ASX down 0.4%, Sensex up 0.5%</li> <li>Euro down 0.13% to $1.117</li> <li>Dollar Index up 0.03% to 95.49</li> <li>Italian 10Yr yield up 0bps to 1.35%</li> <li>Spanish 10Yr yield down 0bps to 1.35%</li> <li>French 10Yr yield up 2bps to 0.66%</li> <li>S&amp;P GSCI Index up 0.8% to 416.4</li> <li>Brent Futures up 2.1% to $60.8/bbl, WTI Futures up 1.5% to $50.3/bbl</li> <li>LME 3m Copper down 0.9% to $5850/MT</li> <li>LME 3m Nickel down 0.8% to $13740/MT</li> <li> Wheat futures up 0.3% to 501.3 USd/bu</li> </ul> <p><strong>Bulletin Headline Summary From RanSquawk and Bloomberg</strong></p> <ul> <li>European newsflow is relatively quiet so far with participants now awaiting the US’ arrival to the market</li> <li>AUD manages to hold onto its overnight gains after the RBA refrained from cutting rates, although warned that further easing may be appropriate over the period ahead</li> <li>Looking ahead, today sees the release of Canadian GDP at 1330GMT/0730CST</li> <li>Treasuries extend yesterday’s decline before Actavis prices 9-part deal that could be second-largest on record; market focus also on Friday’s payrolls and average hour earnings data.</li> <li>Order book for Actavis deal said to be around $90b; pricing expected today</li> <li>Global banks are EU305b ($341b) short of a target for easy-to-sell assets intended to prevent another financial crisis, according to the latest data from the Basel Committee on Banking Supervision; LCR takes full effect in 2019</li> <li>Draghi will have an opportunity at ECB meeting Thursday to add to details of the EU1.1t QE plan announced in January; will also unveil the ECB’s first growth and inflation forecasts for 2017, numbers that will have significance for program’s duration</li> <li>ECB’s QE plan might have already blown a EU92b hole in defined-benefit pension plans by depressing bond yields, S&amp;P said Feb. 26; if the actual start of QE&nbsp; pushes yields further, for longer, companies may have to take drastic measures to make ends meet, and could face a hit to their credit ratings</li> <li>Reserve Bank of Australia said further interest-rate cuts could be needed to bolster growth after it unexpectedly left its benchmark unchanged</li> <li>PBOC Deputy Governor Yi Gang says he doesn’t see urgent need to change yuan band, current range for yuan trading is “much more flexible than before”</li> <li>The Swiss economy grew twice as fast as economists forecast at the end of 2014, indicating resilience before the central bank scrapped a currency cap that was shielding exporters</li> <li>Hillary Clinton used personal e-mail account to conduct govt business as secretary of state, State Department officials say, and may have violated federal requirements that official correspondence be retained as part of agency’s record: NYT</li> <li>Sovereign 10Y yields higher. Asian stocks mostly lower. European stocks stocks gain; U.S. equity-index futures decline. Crude higher; gold little changed, copper falls</li> </ul> <p><strong>US Economic Data</strong></p> <ul> <li>9:45am: ISM New York, Feb. (prior 44.5)</li> <li>10:00am: IBD/TIPP Economic Optimism, March, est. 47.5 (prior 47.5)</li> <li>Wards Total Vehicle Sales, Feb., est. 16.7m (prior 16.56m)</li> <li>Wards Domestic Vehicle Sales, Feb., est. 13.4m (prior 13.31m)</li> </ul> <p><strong>DB's Jim Reid completes the overnight news roundup</strong></p> <p>Over the last few weeks it feels like there's been a big story to talk about everyday. We had the build-up and announcement of ECB QE, the SNB shock, the Greece story, negative bond yields and numerous central banks easing across the globe. This morning it feels like we're in a little lull and the story that has caught our eye most over the last 24 hours is purely a sentimental one. Yesterday the NASDAQ closed above 5000 for the first time since March 2000. At the time we have fond memories of showing a graph of the S&amp;P 500 after 1929, pointing out that after that bubble burst, it took until 1954 for the index to scale its former peak. Well on this measure the NASDAQ has done rather well, only taking 15 years to get close to its old peak (of 5049).</p> <p>The NASDAQ 2000 bubble and the current negative government bond yields are linked in our opinion. Over the last 15-20 years policy makers have tried to limit the fall-out from various major shocks/events by very aggressive stimulus not seen before in history. No bubble has been allowed to fully correct naturally without such intervention. To cut a long story short this has ensured rolling bubbles through the financial system (equities, finance, housing, credit, private debt) and there's little doubt in our mind that there is a now a bubble in parts of the government bond market as a result of this policy super-cycle. It’s very hard to say when this bond bubble will burst as indeed its needed to some degree to smoothly finance the mountain of debt we have. However it will likely burst in some form eventually. The best case scenario for this to unwind and avoid a financial crisis will be for bond holders to take a slow and long haircut via inflation. There is precedent for this as US and UK government bond investors saw their investments half in real-terms in the 35 years that followed WWII after a large debt build up. A stunningly bad period for fixed income returns but one without defaults. </p> <p>The conclusion from this is that we believe there are long cycles in markets. When equities are chronically overvalued they can easily go nowhere for a couple of decades. However when bonds are chronically over-valued you may either never get your money back or have it eroded aggressively by inflation. Fascinating times. I'm really not sure how central banks get out of this one longer-term without serious damage. However the start of the resolution to this story could still be someway ahead. </p> <p>While we're on this subject a reminder that yesterday we published a note looking at the record monthly run of positive total returns of the iBoxx Euro indices. In the note we showed that the government benchmark to these indices was now negative for the first time and the credit index now below 1% (also for the first time). We also showed that a 2bps increase in yields in a month was now enough for a negative total return for Euro credit indices. So while we still like spreads, periodic negative total return months are becoming inevitable.</p> <p>Following on from this yesterday was a day of rising bond yields. 10y Bunds rose 2.7bps to 0.354% which much of the move coming late in the day whilst US Treasuries went back above 2% climbing 8.9bps to 2.082%. It was weaker day across the Treasury curve in fact as 2y yields closed at 0.662% (+4.4bps) and are now just off the 2015 highs in yield we saw back in early January (0.665%). Although yesterday’s macro data was mixed, there was enough in it to disturb bonds a little. Following the weak Chicago PMI on Friday, it was all eyes on the ISM manufacturing yesterday afternoon in the US which, despite falling 0.6pts to 52.9 and the lowest reading since January last year, was more or less in line with expectations (53.0) and helped abate some of the earlier fears from Friday’s shock reading. In conjunction with the better sentiment from the China move over the weekend, the S&amp;P 500 closed +0.61% - offsetting three previous days of decline to record a fresh record high. </p> <p>Data elsewhere in the US was largely mixed. Both personal income (+0.3% mom vs. +0.4% expected) and personal spending (-0.2% mom vs. -0.1% expected) were a touch below expectations. The PCE deflator was as expected with the energy influenced headline down to +0.2% yoy (from +0.8%) and the core unchanged at +1.3% yoy. Meanwhile, in contrast to the ISM print, the final reading of the Markit manufacturing PMI rose 0.8pts to 55.1 in February. Finally the ISM price paid was unchanged at 35 (although below expectations of 37.5) and construction spending surprised to the downside (-1.1% mom vs. +0.3% expected). </p> <p>Meanwhile in Europe yesterday, focus was on the inflation print for the Euro-area which helped support a move wider in bond yields across the region. The headline CPI estimate of -0.3% yoy for February was down three-tenths of a percent from January but came in a touch ahead of expectations (-0.4% yoy) whilst the final core reading for the month was unchanged at +0.6% yoy. Elsewhere, it was case of generally mixed prints. Unemployment came in below consensus (11.2% vs. 11.4% expected) whilst the final February manufacturing PMI print for the region was revised down a tenth to 51.0 as Germany was revised up (51.1 vs. 50.9 previously) but offset by a lower revision for France (47.6 vs. 47.7 previously). Meanwhile the preliminary February manufacturing PMI reading for the UK was firmer than expected at 54.1 (vs. 53.3) – and was in fact the highest reading since July last year. </p> <p>Despite the better than expected inflation print, bourses in Europe were generally subdued with the Stoxx 600 finishing -0.23% and DAX +0.08%. Energy stocks (-1.30%) were a notable drag however after Brent (-4.86%) in particular took a sharp leg lower. </p> <p>There was further chatter in Greece yesterday after the Spanish economy minister, Luis de Guindos, suggested that the Eurogroup were looking at a third bailout package for Greece worth in the range of €30bn - €50bn. Specifically, Guindos was quoted on the FT as saying that ‘we are negotiating a third rescue for Greece’ which would likely provide for ‘flexibility’ and include new attached conditions. The suggestions of a third package is not a surprise although it’s the first signs from Euro members that talks of such nature have happened beyond just the extension of the current programme. Attention in the near term however continues to be on current financing for Greece with continued worries that the government is due to run out of cash this month. An upcoming T-Bill auction tomorrow will be watched closely given the €1.4bn maturing on Friday for the nation as well as a €300m IMF repayment. With tensions clearly running high on the current liquidity position, according to the UK Telegraph, the Greek economy minister Stathakis was reported as saying that the government could also draw upon various central bank deposits including pension reserves.</p> <p>Quickly glancing over our screens this morning, focus has been on Australia in large part following the RBA meeting in which the Central Bank has, to some surprise, kept rates on hold – however there was some indication in the statement that further rate cuts could be appropriate over the near term. The AUD has rallied around +0.8% versus the Dollar following the news whilst the ASX has fallen 0.42% as we type. </p> <p>Elsewhere, bourses are generally mixed. The Shanghai Comp (-1.12%) is weaker whilst the Nikkei (-0.04%) and Hang Seng (-0.05%) are largely unchanged and the Kospi (+0.24%) is higher. In terms of the day ahead, it’s a lighter calendar in Europe today with Euro-area PPI, German retail sales and Spanish employment data all due up. Meanwhile across the Atlantic this afternoon in the US we’ve got the ISM NY, IBD/TIPP economic optimism index and February vehicle sales data all due.</p> http://www.zerohedge.com/news/2015-03-03/market-wrap-futures-decline-treasurys-weak-actavis-mega-deal-dollar-12-year-high#comments Australia Australian Dollar Auto Sales Bond Central Banks Chicago PMI China Copper CPI Crude Eurozone Finland fixed France Germany Greece HFT Japan Jim Reid Markit NASDAQ Natural Gas Nikkei Personal Income RANSquawk Unemployment Yuan Tue, 03 Mar 2015 11:58:15 +0000 Tyler Durden 502742 at http://www.zerohedge.com Gold and Debt: Astonishing Comparisons http://www.zerohedge.com/news/2015-02-28/gold-and-debt-astonishing-comparisons <p>&nbsp;</p> <p>&nbsp;</p> <p>&nbsp;</p> <p><span style="text-decoration: underline;"><em><strong><a href="http://www.sprottmoney.com/sprott-news?mw_aref=d0d00a311961371d69bcc0f5d530833e">Posted with permission by&nbsp;Gary Christenson - The Deviant Investor</a></strong></em></span></p> <p>&nbsp;</p> <p>&nbsp;</p> <p>Debt and budgets in the trillions of dollars and euros are difficult to comprehend. The US budget is nearly $4 Trillion per year while the US official national debt exceeds $18 Trillion. A single large bank may hold contracts for more than $50 Trillion in derivative contracts. Global debt is approximately $200 Trillion.</p> <p>&nbsp;</p> <p>Let’s relate those numbers to gold prices, gold mined each year, and gold mined throughout history.</p> <p>&nbsp;</p> <ul> <li>According to McKinsey &amp; Company total global debt as of December 2014 was about $200 Trillion. Although the exact amount of mined gold is unknown, assume that 172,000 metric tons of gold have been mined throughout history. At 32,151 (troy) ounces per metric ton, that calculates to about 5.5 billion ounces of gold. If that gold backed the debt at 100%, <strong>each ounce of gold would back $36,000 in debt</strong>.</li> </ul> <ul> <li>According to McKinsey &amp; Company, the global debt has increased by about $57 Trillion in the last seven years. In round numbers 3,000 metric tons of gold are mined each year. <strong>The debt increase in the last seven years would equate to gold mined in those seven years at nearly $85,000 per ounce.</strong></li> </ul> <ul> <li>Official United States national debt increased in the last ten years by about $10.5 Trillion. Assuming the US mines about 200 metric tons of gold per year, <strong>the US added approximately $160,000 in debt per ounce of gold mined in the US.</strong></li> </ul> <ul> <li>Many people watched the super bowl earlier this month. To indicate how little gold exists in the world, imagine a layer of gold covering the football field, which is 360 feet by 160 feet. That layer of gold would be about 6.5 feet high, about the height of a lineman, and would be all the gold mined throughout history. If it were a cube it would be about 72 feet high, wide, and deep. For a soccer (futbol) field the sheet of gold would be a few centimeters thinner than two meters.</li> </ul> <ul> <li>The US government will spend approximately $4 Trillion this year. Assuming the United States still has the 260,000,000 ounces of gold that it claims – which has not been audited in about 60 years – that means <strong>the government spends the equivalent of its entire (supposed) hoard of gold (at $1,200 per ounce) in less than 30 days.</strong></li> </ul> <p>&nbsp;</p> <p>&nbsp;</p> <h3><strong>Summary:</strong></h3> <ol> <li>If all the gold ever mined were used to back global debt, each ounce of gold would back about $36,000 in debt.</li> <p></p> <li>But if we look at only the increase in global debt in the past seven years and compare to the gold mined during that time, the number increases to about $85,000 in debt per ounce of gold.</li> <p></p> <li>For the United States over the past decade, official debt increased at about $160,000 for every ounce of gold mined in the US.</li> <p></p> <li>All the gold ever mined in history would fit on a football or soccer field and rise to a height of about six feet. Clearly there has been little gold mined in the past 10,000 years because it is so rare.</li> <p></p> <li>US government expenses are so large that the government spends the equivalent of its entire (official) gold hoard, at current prices, every 30 days.</li> <p></p> <li><strong>Gold is rare and much too inexpensive compared to the $ trillions of debt created each year.</strong></li> <p></p> <li><strong>Gold prices will rise or the amount of debt in the world will seriously contract. Bet on rising gold prices.</strong></li> </ol> <p>&nbsp;</p> <p>&nbsp;</p> <p>&nbsp;</p> <p><span style="text-decoration: underline;"><em style="line-height: 20.7999992370605px;"><strong><a href="http://www.sprottmoney.com/sprott-news?mw_aref=d0d00a311961371d69bcc0f5d530833e">Posted with permission by&nbsp;Gary Christenson - The Deviant Investor</a></strong></em></span></p> http://www.zerohedge.com/news/2015-02-28/gold-and-debt-astonishing-comparisons#comments McKinsey National Debt Tue, 03 Mar 2015 04:55:57 +0000 Sprott Money 502663 at http://www.zerohedge.com Despite Russian Warnings, US Will Deploy A Battalion To Ukraine By The End Of The Week http://www.zerohedge.com/news/2015-03-02/despite-russian-warnings-us-will-deploy-battalion-ukraine-end-week <p><em>&quot;<strong>Before this week is up, we&rsquo;ll be deploying a battalion... to the Ukraine</strong> to train Ukrainian forces for the fight that&#39;s taking place,&quot;</em> stated US 173rd Airborne Brigade Commander Colonel Michael Foster said at the Center for Strategic and International Studies in Washington, DC on Monday. <a href="http://www.zerohedge.com/news/2015-03-02/russia-warns-nato-any-threat-ukraine-will-see-military-response">Despite earlier warnings from Russia (and claims that NATO had not agreed to any such foreign &#39;boots on the ground&#39; action&#39;)</a>, <a href="http://sputniknews.com/military/20150303/1018973141.html">Sputnik News reports</a>, Foster added, &quot;what we&rsquo;ve got laid out is <strong>six United States companies that will be training six Ukrainian companies throughout the summer.</strong>&quot;</p> <p><a href="http://www.zerohedge.com/news/2015-02-24/western-boots-ground-ukraine-britain-sends-75-military-advisers-combat-russia-backed">This comes a week after PM David Cameron confirmed</a> <strong>Britain will be sending 75 military personnel to help combat Russian military aggression.</strong></p> <p>Despite earlier reports from Russia&#39;s NATO envoy that, <a href="http://tass.ru/en/world/780572"><em>as TASS reports,</em></a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>NATO has taken no decisions on sending British or any other instructors to Ukraine</strong>, Russia&rsquo;s Ambassador to the North Atlantic Alliance Alexander Grushko said on Monday.</p> <p>&nbsp;</p> <p>&quot;NATO has taken no decisions on sending instructors,&quot; he told the Rossiya 24 television channel. &quot;NATO is implementing the decisions that were taken at the political level at the Wales summit in September 2014.&quot;</p> <p>&nbsp;</p> <p><strong>Moscow will take all measures, including military-technical, to neutralize possible threat from NATO presence in Ukraine, he added.</strong></p> </blockquote> <p>It seems it is happening, <a href="http://sputniknews.com/military/20150303/1018973141.html">as Sputnik News reports</a>,</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>The United States will deploy personnel by the end of this week to train the Ukrainian national guard,</strong> US 173rd Airborne Brigade Commander Colonel Michael Foster said at the Center for Strategic and International Studies in Washington, DC on Monday.</p> <p>&nbsp;</p> <p><strong>&ldquo;Before this week is up, we&rsquo;ll be deploying a battalion minus&hellip; to the Ukraine to train Ukrainian forces for the fight that&rsquo;s taking place,&rdquo; </strong>Foster stated. &ldquo;What we&rsquo;ve got laid out is six United States companies that will be training six Ukrainian companies throughout the summer.&rdquo;</p> <p>&nbsp;</p> <p>...</p> <p>&nbsp;</p> <p><strong>The current plan is for US forces to stay six months,</strong> he said, and noted there have been discussions about how to increase the duration and the scope of the training mission.</p> <p>&nbsp;</p> <p>The current channels for military training set up between Ukraine and the United States would not be used for transferring defensive lethal aid if the United States decided to provide arms to Ukraine, Foster told Sputnik on Monday.</p> <p>&nbsp;</p> <p><strong>&ldquo;It would go through something separate... We would not funnel the lethal aid or arms through that [training] event, we would use a secondary method for that,&rdquo;</strong> Foster said, adding that a completely separate process is preferable.</p> </blockquote> <p>*&nbsp; *&nbsp; *</p> <p><strong>Here is the full interview with Colonel Foster</strong>: &quot;If Russia will invade Ukraine, why would we not think they will invade the US next?&quot;</p> <p>At 14:45, Colonel Foster discusses the deployment of US troops to Ukraine...</p> <p><iframe frameborder="0" height="315" src="https://www.youtube.com/embed/3s7Dpm5RyJo" width="560"></iframe></p> <p>*&nbsp; *&nbsp; *</p> <p>Of course, <a href="http://www.zerohedge.com/news/2015-01-25/out-my-face-please-why-are-us-soldiers-mariupol">we already knew American military boots were on the ground in east Ukraine...</a></p> <p><iframe allowfullscreen="" frameborder="0" height="360" src="https://www.youtube.com/embed/jW1JdOXdJkU" width="480"></iframe></p> <p>&nbsp;</p> <p>But this seems like a direct aim at Putin after the war-mongery rhetoric this morning:</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="314" height="291" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150302_ukr1.jpg?1425345520" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-02/despite-russian-warnings-us-will-deploy-battalion-ukraine-end-week#comments Ukraine Tue, 03 Mar 2015 04:00:51 +0000 Tyler Durden 502739 at http://www.zerohedge.com $4 Million In Gold Bars Stolen In 11th Largest Heist In History http://www.zerohedge.com/news/2015-03-02/4-million-gold-bars-stolen-11th-largest-heist-history <p>Long-time Zero Hedge readers may remember the rather surreal moment towards the beginning of the long-running German tungsten/gold repatriation saga, when Bundesbank Executive Board member Andreas Dombret <a href="http://www.zerohedge.com/news/2012-11-03/bundesbank-continues-golden-damage-control-invokes-ghosts-simon-gruber-and-goldfinge">assured the NY Fed</a> that Germany wasn’t afraid of Simon Gruber (or Goldfinger for that matter) “masterminding gold heists in U.S. vaults.”&nbsp;</p> <p>Well, since it now appears Germany is all set to ramp up its repatriation efforts (see the NY Fed’s November <a href="http://www.zerohedge.com/news/2015-01-19/bundesbank-resumes-gold-repatriation-transfers-120-tonnes-physical-gold-paris-and-ny">monthly outflow</a> numbers), Buba may want to reconsider its stance on the threat posed by ambitious bandits, <strong>as less than 24 hours ago, an estimated 4 million in gold bars were commandeered (on the side of I-95 no less), by gun wielding desperados.</strong></p> <p>From CBS:&nbsp;</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>North Carolina authorities and the FBI are investigating the theft of an estimated $4 million worth of gold allegedly stolen during an armed robbery along Interstate 95 on Sunday evening, CBS affiliate WRAL reports.</em></p> <p><em><br /></em></p> <p><em>After mechanical problems with their truck, two armed guards who were traveling from Miami to Massachusetts with a shipment of silver and gold pulled over at mile marker 114 on the Interstate.</em></p> <p><em><br /></em></p> <p><em>According to the station, the sheriff's office says the guards reported that three armed men in a white van approached them, ordered them to the ground, tied their hands behind their backs and forced them to walk into some nearby woods. Investigators, who responded to the scene shortly before 7 p.m., said the men then reportedly took several barrels of gold and left while the guards were in the woods.</em></p> </blockquote> <p>While it’s not clear if the perpetrators here were in fact relatives of anyone killed by John McLane, what we do know is that this was no small feat. Here’s local affiliate WNCN:&nbsp;<em><span style="font-size: 1em; line-height: 1.3em;">“...gold robberies of this magnitude are rare. The largest gold robbery in Florida, for example, was the $2.8 million stolen in 2012.”&nbsp;</span></em></p> <p><span style="font-size: 1em; line-height: 1.3em;"><strong>A quick look back at last year’s <a href="http://www.zerohedge.com/news/2014-10-07/15-greatest-gold-heists-all-time">ZH post chronicling</a> the 15 greatest gold heists of all-time reveals that yesterday’s 6:50 p.m. robbery was in fact the 11th biggest gold bullion heist ever!</strong> Below, find the original infographic.&nbsp;</span></p> <p>&nbsp;</p> <p>&nbsp;</p> <div style="clear: both;"><a href="http://www.visualcapitalist.com/15-greatest-gold-heists-time/"><img src="http://2oqz471sa19h3vbwa53m33yj.wpengine.netdna-cdn.com/wp-content/uploads/2014/10/15-greatest-gold-heists.jpg" border="0" /></a></div> <div>Courtesy of: <a href="http://www.visualcapitalist.com">Visual Capitalist</a></div> <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="304" height="300" alt="" src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/SimonGrue.jpg?1425329323" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-02/4-million-gold-bars-stolen-11th-largest-heist-history#comments FBI Florida Germany Tue, 03 Mar 2015 03:54:35 +0000 Tyler Durden 502724 at http://www.zerohedge.com Is the Media Trying to "Disappear" Rand Paul (Just Like His Father)? http://www.zerohedge.com/news/2015-03-02/media-trying-disappear-rand-paul-just-his-father <p><a href="http://libertyblitzkrieg.com/2015/03/01/is-the-media-trying-to-disappear-rand-paul-as-was-done-to-his-father/"><em>Submitted by Mike Krieger via Liberty Blitzkrieg blog</em></a>,</p> <p>On Friday, the <em>Wall Street Journal</em> ran <a href="http://www.wsj.com/public/resources/documents/pageone0227.pdf">a cover photo</a> of the Republican hopefuls set to attend&nbsp;the Conservative Political Action Conference (CPAC) in Maryland. The caption at the bottom of the picture read:<strong> <em>At a meeting of the Conservative Political Action Conference, an attendee holds photos of possible presidential candidates.</em></strong></p> <p>This is what the photo looked like:</p> <p><a href="http://libertyblitzkrieg.com/wp-content/uploads/2015/03/Screen-Shot-2015-02-28-at-3.06.04-PM.jpg"><img alt="Screen Shot 2015-02-28 at 3.06.04 PM" class="alignnone size-large wp-image-21727" src="http://libertyblitzkrieg.com/wp-content/uploads/2015/03/Screen-Shot-2015-02-28-at-3.06.04-PM-1024x749.jpg" style="width: 600px; height: 439px;" /></a></p> <p>&nbsp;</p> <p><strong>Notice anything bizarre about this photograph? Let&rsquo;s see. </strong>There&rsquo;s Scott Walker, Marco Rubio, Jeb Bush, Chris Christie, Rick Santorum, Ted Cruz, Sarah Palin and Rick Perry. Basically every insane hack and oligarch puppet imaginable is prominently featured. <u><strong>Yet, the man who would go on to<a href="http://www.huffingtonpost.com/2015/02/28/cpac-straw-poll-results-2015_n_6776028.html"> win the CPAC straw poll</a>, Rand Paul, isn&rsquo;t anywhere to be seen.</strong></u></p> <p>Actually, upon further inspection, his curly locks appear to be protruding from behind Chris Christie&rsquo;s gigantic&nbsp;skull, while&nbsp;his ear is softly caressing Rick Santorum&rsquo;s right eyeball.<strong> The only other face that is&nbsp;entirely covered up seems to be the biggest laughing stock of them all, Donald Trump, </strong>who may&nbsp;actually be a good candidate considering his unique ability to repeatedly emerge from bankruptcy unscathed (yes, I&rsquo;m joking).</p> <p>While this is just one picture, and could indeed be a regrettable&nbsp;oversight<strong>, the reason I brought it up, is because the media shamelessly went out of its way to pretend his father, Ron Paul, didn&rsquo;t exist back in 2012. It was so bad, that Jon Stewart made a classic clip exposing the entire spectacle. </strong>Watch below:</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/qtDJ6Ay4QMw" width="560"></iframe></p> <p>&nbsp;</p> <div class="jetpack-video-wrapper">*&nbsp; *&nbsp; *</div> <p><em>For related articles, see:</em></p> <p><em><a href="http://libertyblitzkrieg.com/2015/02/27/jeb-bush-forced-to-bus-supporters-from-washington-d-c-to-cpac-as-attendees-walk-out-on-him/" rel="bookmark" title="Permanent Link to Jeb Bush Forced to Bus Supporters From Washington D.C. to CPAC as Attendees Walk Out On Him">Jeb Bush Forced to Bus Supporters From Washington D.C. to CPAC as Attendees Walk Out On Him</a></em></p> <p><em><a href="http://libertyblitzkrieg.com/2015/02/18/oligarch-rules-jeb-bush-surrounds-himself-with-the-architects-of-his-brothers-iraq-war/" rel="bookmark" title="Permanent Link to Jeb Bush Exposed Part 1 – His Top Advisors Will Be the Architects of His Brother’s Iraq War">Jeb Bush Exposed Part 1 &ndash; His Top Advisors Will Be the Architects of His Brother&rsquo;s Iraq War</a></em></p> <p><em><a href="http://libertyblitzkrieg.com/2015/02/19/jeb-bush-exposed-part-2-he-thinks-unconstitutional-nsa-spying-is-hugely-important/" rel="bookmark" title="Permanent Link to Jeb Bush Exposed Part 2 – He Thinks Unconstitutional NSA Spying is “Hugely Important”">Jeb Bush Exposed Part 2 &ndash; He Thinks Unconstitutional NSA Spying is &ldquo;Hugely Important&rdquo;</a></em></p> <p><em><a href="http://libertyblitzkrieg.com/2013/06/28/jeb-bush-to-present-the-liberty-medal-to-hillary-clinton/" rel="bookmark" title="Permanent Link to Jeb Bush to Present the “Liberty Medal” to Hillary Clinton">Jeb Bush to Present the &ldquo;Liberty Medal&rdquo; to Hillary Clinton</a></em></p> <p><em><a href="http://libertyblitzkrieg.com/2015/02/20/hilary-clinton-exposed-part-1-how-she-aggressively-lobbied-for-mega-corporations-as-secretary-of-state/">Hillary Clinton Exposed Part 1 &ndash; How She Aggressively Lobbied for Mega Corporations as Secretary of State</a></em></p> <p><em><a href="http://libertyblitzkrieg.com/2015/02/26/hilary-clinton-exposed-part-2-clinton-foundation-took-millions-from-countries-that-also-fund-isis/">Hillary Clinton Exposed Part 2 &ndash; Clinton Foundation Took Millions From Countries That Also Fund ISIS</a></em></p> http://www.zerohedge.com/news/2015-03-02/media-trying-disappear-rand-paul-just-his-father#comments Donald Trump Iraq Jon Stewart Ron Paul Wall Street Journal Washington D.C. Tue, 03 Mar 2015 03:30:22 +0000 Tyler Durden 502737 at http://www.zerohedge.com US Macro Weakest Since July 2011 As Goldman Affirms Global Economy In Contraction http://www.zerohedge.com/news/2015-03-02/us-macro-weakest-july-2011-goldman-affirms-global-economy-contraction <p>Goldman&#39;s Global Leading Indicator (GLI) final print for February affirms the <strong>global economy has entered a contraction</strong> with accelerating negative growth. Just six months after &quot;expansion&quot;, the Goldman Swirlogram has collapsed into &quot;contraction&quot; with monthly revisions notably ugly and <strong>9 out of 10 components declining in February</strong>. Some have suggested, given US equity&#39;s strong February (<a href="http://www.zerohedge.com/news/2015-02-28/here-reason-why-stocks-just-had-their-best-month-october-2011">buyback-driven</a>) performance, that the US economy will decouple from the world... or even drive it.. but that is 100% incorrect.<strong> US Macro data has fallen at its fastest pace in 3 years and is at its weakest level since July 2011</strong> as 42 of 48 data items have missed since the start of February.</p> <p>&nbsp;</p> <p>With 9 of 10 components negative in February,<strong> Goldman&#39;s Swirlogram has collapsed from expansion to contraction within just 6 months...</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro3.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro3.jpg" style="width: 600px; height: 516px;" /></a></p> <p>&nbsp;</p> <p>First negative print since 2012 - i<strong>ndicating global industrial production is set to contract...</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro2.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro2_0.jpg" style="width: 600px; height: 531px;" /></a></p> <p><em><strong>What is the GLI:</strong> The Global Leading Indicator (GLI) is a Goldman Sachs proprietary indicator that is meant to provide an early signal of<br />the global industrial cycle on a monthly basis. There is an Advanced reading for each month, released mid-month, followed by the Final reading, released on the first business day of the following month.</em></p> <p>*&nbsp; * *</p> <p><strong>But for those who look at US stocks and somehow believe America is an island economy capable of decoupling from the world... think again</strong> - it&#39;s all a lead-lag cycle and the global contraction blowback is boomeranging back to US data...</p> <p>Today was ugly... nowhere worse than spending...</p> <p><u><strong>For the first time since Q1 2009 (i.e. post Lehman), we have just had back to back drops in consumer spending...</strong></u></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_EOD10.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_EOD10_0.jpg" style="width: 600px; height: 302px;" /></a></p> <p>&nbsp;</p> <p>The Bloomberg US Macro Surprise Index just dropped - after today&#39;s dismal data showing - to its lowest absolute level since July 2011. The last 3 months have seen it fall at the fastest pace sinceJuly 2012. <strong>Notice the lower peaks and lower troughs on each cycle since 2012...</strong></p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_macro1_0.jpg" style="width: 600px; height: 302px;" /></a></p> <p><em>Note: this index tracks not just miss/beat but absolutepositive or negative data items - key to the cyclical aspect is the over-optimism and over-pessimism of economist&#39;s forecasts. The last 3 years (lower peaks and lower troughs) suggest economists are strongly biased to over-optimistic forecasts and normally this kind of drop woul dhave stopped but economists continue to look for hockey-sticks which, perhaps, in this case will be absent (and have been for a month).</em></p> <p>But of course that doesn&#39;t matter...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_EOD1.jpg"><img alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/03/20150302_EOD1_0.jpg" style="width: 600px; height: 316px;" /></a></p> <p>&nbsp;</p> <p><strong><a href="http://www.zerohedge.com/news/2015-02-28/here-reason-why-stocks-just-had-their-best-month-october-2011">A reminder of how this happened</a> </strong>(clue: non-economic buyers)...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/02/announcements%20of%20stock%20buybacks.jpg"><img height="338" src="http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2015/02/announcements%20of%20stock%20buybacks_0.jpg" width="500" /></a></p> <p>&nbsp;</p> <p><span style="text-decoration: underline;"><strong>From the start of February...</strong></span></p> <p><span style="text-decoration: underline;"><strong>MISS</strong></span></p> <ol> <li>Personal Spending</li> <li>Construction Spending</li> <li>ISM New York</li> <li>Factory Orders</li> <li>Ward&#39;s Domestic Vehicle Sales</li> <li>ADP Employment</li> <li>Challenger Job Cuts</li> <li>Initial Jobless Claims</li> <li>Nonfarm Productivity</li> <li>Trade Balance</li> <li>Unemployment Rate</li> <li>Labor Market Conditions Index</li> <li>NFIB Small Business Optimism</li> <li>Wholesale Inventories</li> <li>Wholesale Sales</li> <li>IBD Economic Optimism</li> <li>Mortgage Apps</li> <li>Retail Sales</li> <li>Bloomberg Consumer Comfort</li> <li>Business Inventories</li> <li>UMich Consumer Sentiment</li> <li>Empire Manufacturing</li> <li>NAHB Homebuilder Confidence</li> <li>Housing Starts</li> <li>Building Permits</li> <li>PPI</li> <li>Industrial Production</li> <li>Capacity Utilization</li> <li>Manufacturing Production</li> <li>Dallas Fed</li> <li>Chicago Fed NAI</li> <li>Existing Home Sales</li> <li>Consumer Confidence</li> <li>Richmond Fed</li> <li>Personal Consumption</li> <li>ISM Milwaukee</li> <li>Chicago PMI</li> <li>Pending Home Sales</li> <li>Personal Income</li> <li>Personal Spending</li> <li>Construction Spending</li> <li>ISM Manufacturing<span id="cke_bm_495E" style="display: none;">&nbsp;</span></li> </ol> <p><span style="text-decoration: underline;"><strong>BEAT</strong></span></p> <ol> <li>Markit Services PMI</li> <li>Nonfarm Payrolls</li> <li>JOLTS</li> <li>Case-Shiller Home Price</li> <li>Q4 GDP Revision (but notably lower)</li> <li>Markit Manufacturing PMI</li> </ol> <p>*&nbsp; *&nbsp; *</p> <p>Of course, earnings expectations are not encouraging...</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/02-overflow/20150227_macro_0.jpg"><img height="301" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/02-overflow/20150227_macro1_0.jpg" width="600" /></a></p> <p>*&nbsp; *&nbsp; *</p> <p><strong>But apart from that... everything is awesome.</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="483" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150302_macro1_0.jpg?1425340869" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-02/us-macro-weakest-july-2011-goldman-affirms-global-economy-contraction#comments Global Economy Goldman Sachs goldman sachs Lehman Market Conditions Markit Tue, 03 Mar 2015 03:00:31 +0000 Tyler Durden 502735 at http://www.zerohedge.com Breaking Bad (Debt) - Episode 3 http://www.zerohedge.com/news/2015-03-02/breaking-bad-debt-episode-3 <p><a href="http://www.theburningplatform.com/2015/03/01/breaking-bad-debt-episode-three/"><em>Submitted by Jim Quinn via The Burning Platform blog</em></a>,</p> <p>In <strong><a href="http://www.theburningplatform.com/2015/02/27/breaking-bad-debt-episode-one/">Part One</a></strong> of this three part article I laid out the groundwork of how the Federal Reserve is responsible for the excessive level of debt in our society and how it has warped the thinking of the American people, while creating a tremendous level of mal-investment. In <strong><a href="http://www.theburningplatform.com/2015/02/28/breaking-bad-debt-episode-two/">Part Two</a></strong> I focused on the Federal Reserve/Federal Government scheme to artificially boost the economy through the issuance of subprime debt to create a false auto boom. In this final episode, I&rsquo;ll address the disastrous student loan debacle and the dreadful global implications of $200 trillion of debt destroying the lives of citizens around the world.</p> <h2>Getting a PhD in Subprime Debt</h2> <p style="padding-left: 30px;"><em>&ldquo;When easy money stopped, buyers couldn&rsquo;t sell. They couldn&rsquo;t refinance. First sales slowed, then prices started falling and then the housing bubble burst. Housing prices crashed. We know the rest of the story. We are still mired in the consequences. Can someone please explain to me how what is happening in higher education is any different?This bubble is going to burst.&rdquo; </em><strong>&ndash; <a href="http://www.amazon.com/How-Win-Sport-Business-Can/dp/1626810915/ref=as_sl_pc_tf_til?tag=thebur01-20&amp;linkCode=w00&amp;linkId=QEXBOB5OLHLZTFOP&amp;creativeASIN=1626810915">Mark Cuban</a></strong></p> <p><img alt="" height="206" src="http://i1.cpcache.com/product_zoom/214581475/subprime_nation_shirt.jpg?color=White&amp;height=250&amp;width=250&amp;padToSquare=true" width="206" />&nbsp;<img alt="http://www.nationofchange.org/sites/default/files/StudentLoanDebt070313_0.jpeg" class="decoded" height="205" src="http://www.nationofchange.org/sites/default/files/StudentLoanDebt070313_0.jpeg" width="308" /></p> <p>Now we get to the subprimiest of subprime debt &ndash; student loans. Student loans are not officially classified as subprime debt, but let&rsquo;s compare borrowers. A subprime borrower has a FICO score of 660 or below, has defaulted on previous obligations, and has limited ability to meet monthly living expenses. A student loan borrower doesn&rsquo;t have a credit score because they have no credit, have no job with which to pay back the loan, and have no ability other than the loan proceeds to meet their monthly living expenses. And in today&rsquo;s job environment, they are more likely to land a waiter job at TGI Fridays than a job in their major. These loans are nothing more than deep subprime loans made to young people who have little chance of every paying them off, with hundreds of billions in losses being borne by the ever shrinking number of working taxpaying Americans.</p> <p>Student loan debt stood at $660 billion when Obama was sworn into office in 2009. The official reported default rate was 7.9%. Obama and his administration took complete control of the student loan market shortly after his inauguration. They have since handed out a staggering $500 billion of new loans (a 76% increase), and the official reported default rate has soared by 43% to 11.3%. Of course, the true default rate is much higher. The level of mal-investment and utter stupidity is astounding, even for the Federal government. Just some basic unequivocal facts can prove my case.</p> <p>There were 1.67 million Class of 2014 students who took the SAT. Only 42.6% of those students met the minimum threshold of predicted success in college (a B minus average). That amounts to 711,000 high school seniors intellectually capable of succeeding in college. This level has been consistent for years. So over the last five years only 3.5 million high school seniors should have entered college based on their intellectual ability to succeed. Instead, undergraduate college enrollment stands at 19.5 million. Colleges in the U.S. are admitting approximately 4.5 million more students per year than are capable of earning a degree. This waste of time and money can be laid at the feet of the Federal government. Obama and his minions believe everyone deserves a college degree, even if they aren&rsquo;t intellectually capable of earning it, because it&rsquo;s only fair. No teenager left behind, without un-payable debt.</p> <p><img alt="" class="aligncenter" height="278" id="irc_mi" src="http://s.wsj.net/public/resources/images/OB-YT630_colleg_E_20130903153611.jpg" width="419" /></p> <p>&nbsp;</p> <p>According to <a href="http://nces.ed.gov/fastfacts/display.asp?id=372"><strong>National Center for Educational Statistics</strong></a>, colleges and universities will award 1 million associate&rsquo;s degrees and 1.8 million bachelor&rsquo;s degrees in 2014-2015. So they are admitting more than 5 million in the front end, with only 2.8 million ever earning a degree. That means almost 50% never graduate, confirming the SAT predictive results. Then there is the fact an associate&rsquo;s degree and most of the liberal arts degrees awarded qualify the graduate for a fry cook job at Burger King. What is even more fascinating in this episode of absurdity is the fact undergraduate enrollment has fallen by 930,000 in the last two years and stands only 700,000 higher than when Obama took office. A critical thinking person might ask how student loan debt could grow by $500 billion when college enrollment only grew by 700,000. That is $711,000 per additional student in college. Something doesn&rsquo;t add up.</p> <p>The Federal government couldn&rsquo;t possibly have doled out $500 billion to anyone with a&nbsp;pulse as a way to manipulate the national unemployment rate lower, because anyone in school is not considered unemployed. Do you think the $500 billion was spent on tuition and books? Or do you think those &ldquo;students&rdquo; used it to for hookers, blow, booze, iGadgets, HDTVs, online poker, weed, fantasy football entry fees, and Linkedin stock? &ndash; Whatever it takes to boost GDP. With default rates already at all-time highs and accelerating skyward, with $131 billion of loans already in serious delinquency, you don&rsquo;t need a PhD from the University of Phoenix (where default rates exceed 30%) like Shaq to realize the American taxpayer is going to get it&nbsp;good and&nbsp;hard once again.</p> <p><img alt="" class="aligncenter" height="231" src="http://img140.imageshack.us/img140/6407/73561060.jpg" width="483" /></p> <p>It seems the for-profit diploma mills and community colleges account for a huge percentage of loan defaults. They are nothing but bottom feeders in a feeding frenzy of Federal loans. The five schools in the country with the highest level of defaulters from 2011 through 2014 are as follows:</p> <ol> <li>University of Phoenix &ndash; 45,123</li> <li>ITT Technical Institute &ndash; 11,260</li> <li>Kaplan University &ndash; 10,684</li> <li>DeVry University &ndash; 9,081</li> <li>Ivy Tech Community College &ndash; 7,237</li> </ol> <p>These institutions of lower learning spend more annually on marketing than Ivy League business schools generate in total revenue. They are nothing more than swindlers, gaming the Federal loan system, and dispensing virtually worthless diplomas, and leaving its students deep in debt. The true consequence of providing easy money to people who shouldn&rsquo;t be in college has been to drive up tuition rates at all colleges and universities. Without this $500 billion infusion of illusion, demand would drop, the diploma mills would go out of business, and legitimate institutions would have to lower tuition rates to attract students. But that&rsquo;s not how Obama and his administration roll.</p> <p>The biggest scam is the reported default rate disseminated by the Fed and regurgitated by the mainstream media. There are over 7 million borrowers in default on a federal or private student loan. Roughly a third of Federal Direct Loan Program borrowers have been forced into choosing alternative repayment plans to lower their payments. The reported 11.3% delinquency rate is based on total student loans outstanding. In reality 50% of the loan balances are held by students still in school, in their grace period, in deference, or in forbearance. They haven&rsquo;t been required to make a payment yet. Of course the loans in deference or forbearance due to unemployment or economic hardship are essentially an allowable delinquency. The true delinquency rate on loans in the repayment cycle is 23%. This strongly implies that taxpayers will be on the hook for at least $250 billion of losses.</p> <p>The long term impact on borrowers is also dire. Student loan debt cannot be extinguished in bankruptcy. It will follow them throughout their lives. Defaulting on a federal student loan has serious consequences. Unlike other consumer credit, borrowers in default on a federal student loan might see their tax refund taken and their wages garnished without a court order. The impact on their credit rating will keep them from buying a home. The pure volume of student loan debt is currently restricting household formation, first time home buyers, marriages, and consumer spending. The unintended negative consequences of issuing hundreds of billions in bad debt have far outweighed the ephemeral short term fake benefits. But short-term appearances are all that matter to the ruling class.</p> <p><img alt="" class="aligncenter" src="http://libertystreeteconomics.typepad.com/.a/6a01348793456c970c01b7c74c5c80970b-pi" /></p> <p>As of the fourth quarter of 2014, 11.3% of all borrowers were in default, with an additional 7% of borrowers having defaulted in the past. Another 6% of borrowers were in earlier stages of delinquency, but not yet defaulted; fully 37% of borrowers had at least one missed payment on their credit report. The chart below shows the cohort of student loans since 2005. Each cohort has progressively worse default experience. Roughly one quarter of each of the cohorts has defaulted as of the fourth quarter of 2014. The default rate of the 2009 cohort has surpassed that of the earlier cohorts much more quickly. Based on historical trends, the 2009 cohort will experience close to a 40% default rate. And this is before Obama unleashed the torrent of subprime student loan debt.</p> <p>Only an Ivy League educated Princeton economist could examine the facts presented and conclude these were brilliant fiscal policy decisions which have boosted economic activity and fended off another Depression. A rational thinking person would conclude these desperate reckless measures will result in far worse outcomes when the debt dominoes begin to fall.</p> <p><img alt="" class="aligncenter" height="288" src="http://www.scmp.com/sites/default/files/styles/486x302/public/2014/07/11/6ba75b8b8dbc2375da4c4c0c221c47e2.jpg?itok=w3URuJZa" width="463" /></p> <h2>We are in a World of Debt</h2> <p style="padding-left: 30px;"><em>&ldquo;After the 2008 financial crisis and the longest and deepest global recession since World War II, it was widely expected that the world&rsquo;s economies would deleverage. It has not happened. Debt continues to grow. Since 2007, global debt has grown by $57 trillion, raising the ratio of debt to GDP by 17 percentage points.&rdquo;</em> &ndash; <strong>McKinsey</strong></p> <p><img alt="" class="aligncenter" height="351" src="http://confoundedinterest.files.wordpress.com/2015/02/debt-crisis-resolved.jpg?w=792&amp;h=542" width="514" /></p> <p>It seems McKinsey is making the mistake of thinking like a logical sentient human being, rather than intellectually dishonest central bankers, criminally psychotic Wall Street CEOs, greedy myopic mega-corporation CEOs, or captured cowardly politicians. In a world run by honest, intelligent, rational people who cared about the long-term sustainability of our economic system, the actions taken after the 2008 debt fueled implosion would have been far different than the actions taken by the psychopathic, greedy, ego maniacal, hubristic moneyed interests over the last six years.</p> <p>The 2008 worldwide financial crisis was produced due to excessively easy monetary policy, which caused the largest debt driven mal-investment in housing, automobiles, and Chinese produced crap in world history. It was done purposely by a uber-wealthy ruling class who call the shots, rig the game, reap the benefits, and deny responsibility when their machinations create havoc and suffering across the globe for the masses.</p> <p>The consequences of this debt bacchanalia should have been the orderly liquidation of the Wall Street entities that created the crisis, the writing off of trillions in bad debt, corporate and personal bankruptcies of businesses and people who borrowed recklessly, a sharp steep economic decline to cleanse the excesses, and politicians who immediately began the process of reducing budgets and addressing long term unfunded unpayable liability promises. Instead, the psychotic oligarchs did not want to lose any of their power, wealth or control over the proletariat. They have done the exact opposite of what needed to be done. You must deleverage to solve a crisis caused by excessive debt. The oligarchs have succeeded in further raping and pillaging the working class, but have only delayed the final reckoning and guaranteed a debt apocalypse when their futile schemes fail again. And fail they will.</p> <p>Arrogant condescending central bankers, narcissistic Wall Street psychopaths, crooked bought off politicians, and narrow-minded government apparatchiks across the developed world have colluded to add $57 trillion of additional debt to the existing Himalayan Mountain of unpayable debt we started with in 2008. We&rsquo;ve entered the NIRP phase of the currency debasement race for the bottom.</p> <p>Households throughout the developed world have acted in a relatively rational manner by paying down credit card debt and attempting to live within their means, because their real wages continue to decline and they are receiving no return on their savings. The moneyed interests continue to prey on the desperate and financially ignorant in their last ditch desperate attempt to loot the remaining treasure from the U.S.S. Titanic, hijack the remaining lifeboats, and leave the American people to sink into the frigid murky depths.</p> <p>Corporate titans have added $18 trillion of debt as they take on debt to buy back their overpriced stock, artificially enhancing earnings per share and boosting their own compensation packages. Investing in their business is passé. We&rsquo;ve entered a new paradigm where driving your stock price higher is all that matters to the Ivy League MBA executives. The Financial sector has shifted most of their toxic debt onto the Federal Reserve balance sheet and the backs of the American taxpayer.</p> <p>The governing bodies of Japan, the EU, and the US have accounted for the vast majority of the $25 trillion increase in debt by the government sector. Total world debt as a percentage of World GDP is now approaching 300%. In 2000, the percentage was 185%. This level of debt can&rsquo;t be sustained at zero interest rates, let alone normalized rates of 5%. Something that can&rsquo;t be sustained won&rsquo;t be. It is mathematically impossible for $200 trillion of debt to ever be repaid. It&rsquo;s just a question of who gets screwed. And if the moneyed interests have their way, it&rsquo;ll be you.</p> <p><img alt="" class="aligncenter" height="310" src="http://confoundedinterest.files.wordpress.com/2015/02/gloutdebt.jpg" width="455" /></p> <p>Everyone loves a boom. The party from 1996 to 2000 was a blast. Remember your moronic brother-in-law boasting about getting rich day trading. The bust was a bummer and your brother-in-law had to get a job at Wendy&rsquo;s. The highly educated academics at the Fed couldn&rsquo;t allow the pain or consequences to last. They made it their sole responsibility to create another boom from 2003 to 2008. It was a real doozy. The hangover afterwards was going to be epic.</p> <p>The party should have been over, but Ben and Janet know better than the rest of us. Ben is a self-proclaimed expert on the Great Depression. Pain isn&rsquo;t fun. Corrections and adversity must be banned. They have now created the most all-encompassing debt fueled contrived boom in history, with debt, stocks, and real estate all outrageously overvalued. The party has been going on for over five years. The inevitable collapse will be earth shatteringly horrendous. The public will be shocked once again. The anger, disillusionment, and shattering of confidence in the powers that be will be monstrous. This time there will be blood.</p> <p style="padding-left: 30px;"><em>&ldquo;The boom produces impoverishment. But still more disastrous are its moral ravages. It makes people despondent and dispirited. The more optimistic they were under the illusory prosperity of the boom, the greater is their despair and their feeling of frustration. The individual is always ready to ascribe his good luck to his own efficiency and to take it as a well-deserved reward for his talent, application, and probity. But reverses of fortune he always charges to other people, and most of all to the absurdity of social and political institutions. He does not blame the authorities for having fostered the boom. He reviles them for the inevitable collapse. In the opinion of the public, more inflation and more credit expansion are the only remedy against the evils which inflation and credit expansion have brought about&rdquo;. <strong>&ndash; </strong></em><strong><a href="http://www.amazon.com/Human-Action-Treatise-Economics-Volume/dp/0865976317/ref=as_sl_pc_tf_til?tag=thebur01-20&amp;linkCode=w00&amp;linkId=W7GXNDCDCJ437EEH&amp;creativeASIN=0865976317">Ludwig von Mises</a></strong></p> <p>Despite the non-stop propaganda campaign waged by the ruling class through their media mouthpieces about a non-existent economic recovery, the papering over of the gaping funding holes through the issuance of $57 trillion more debt, the waging of wars against terrorists we created to distract the masses, conducting coups against our latest perceived enemies, and the blatant rigging of financial markets to extract the remaining wealth of the nation from the people, the crack-up boom is nearing its endgame. The system is exceptionally fragile. Confidence in leaders is waning. The people are growing weary of the lies and their restlessness will morph into anger when the economic collapse resumes. You can sense things are not right. Trust in the system has turned to suspicion and cynicism. The growing anger in the nation and the world is palpable. Violent protests are a daily event, even if the mainstream media doesn&rsquo;t report them.</p> <p><img alt="" class="aligncenter" height="382" src="http://1.bp.blogspot.com/-tsoeQpegFtw/VO91cngVxmI/AAAAAAAA9tE/XkmxuF6raSI/s1600/economics.JPG" width="514" /></p> <p>Yellen, Draghi, and Kuroda speak as if they know what they are doing, perform confidently when on stage, but continue to act in desperate manner five years into a supposed economic recovery. The emergency measures they continue to employ and expand upon reveal their angst and inability to implement a monetary solution. Their only tool is the printing press and when confidence in their infallibility dissipates, the system will fail. The stench of fraud, cronyism, corruption, and hypocrisy of the moneyed interests permeates our degraded culture of materialism, greed and criminality. The party was fun while it lasted, but it is reaching its sordid drunken climax in the near future. There is no means of avoiding the final collapse of this Federal Reserve created boom.</p> <p><img alt="" class="aligncenter" height="319" src="http://modernsurvivalblog.com/wp-content/uploads/2014/04/the-coming-dollar-collapse.jpg" width="516" /></p> <p style="padding-left: 30px;"><em>&ldquo;There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.&rdquo; </em>&ndash; <strong><a href="http://www.amazon.com/Human-Action-Treatise-Economics-Volume/dp/0865976317/ref=as_sl_pc_tf_til?tag=thebur01-20&amp;linkCode=w00&amp;linkId=W7GXNDCDCJ437EEH&amp;creativeASIN=0865976317">Ludwig von Mises</a></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="285" height="197" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150302_debt.jpg?1425341449" /> </div> </div> </div> http://www.zerohedge.com/news/2015-03-02/breaking-bad-debt-episode-3#comments B+ Consumer Credit Corruption CRAP Cronyism default Default Rate Fail Federal Reserve Great Depression Housing Bubble Housing Prices Japan Ludwig von Mises McKinsey Monetary Policy Real estate Reality Recession recovery Student Loans The Graduate Unemployment Tue, 03 Mar 2015 02:30:05 +0000 Tyler Durden 502736 at http://www.zerohedge.com