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David Stockman Ruins The Perennial Myth Of Crumbling Infrastructure





Whenever the beltway bandits run low on excuses to run-up the national debt they trot out florid tales of crumbling infrastructure - that is, dilapidated roads, collapsing bridges, failing water and sewer systems, inadequate rail and public transit and the rest. This is variously alleged to represent a national disgrace, an impediment to economic growth and a sensible opportunity for fiscal “stimulus”. But most especially it presents a swell opportunity for Washington to create millions of “jobs”. One thing is clear. There is no case for adding to our staggering $17 trillion national debt in order to replace the bridges of Madison county; or to fix state and local highways or build white elephant high speed rail systems; or to relieve air travelers of paying user fees to upgrade local airports or local taxpayers of their obligation to pay fees and taxes to maintain their water and sewer systems. At the end of the day, the ballyhooed national infrastructure crisis is a beltway racket of the first order. It has been for decades.

 
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America's Nine Classes: The New Class Hierarchy





There are many ways to slice and dice America's power/wealth hierarchy. The conventional class structure is divided along the lines of income, i.e. the wealthy, upper middle class, middle class, lower middle class and the poor. We suggest that a more useful scheme is to view America through the lens not just of income but of political power and state dependency. Sadly, eight of the nine classes are hidebound by conventions, neofeudal and neocolonial arrangements and a variety of false choices.

 
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Time For More Costs? Pro-Russian Forces Storm Luhansk Police Buildings - Live Feed





One of East Ukraine's largest cities, Luhansk, has seen its police headquarters over-run by pro-Russian activists (with machine guns and greande launchers evident):

*GUNSHOTS HEARD AS POLICE BUILDING STORMED IN LUHANSK: IFX
*PRO-RUSSIAN PROTESTERS STORM LUHANSK POLICE BUILDINGS: IFX

In the immediate aftermath, the police chief has resigned over the separatist demands but as France24 reports, Ukraine's president has slammed police 'inaction' and 'criminal treachery' as rebels stormed state buildings. The demonstrators chanted "Referendum Russia" and raised a Russian flag over the building after the takeover.

 
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Gunmen Storm Libyan Parliament, Start Shooting





When it comes to expressing democratic opinion, one can wait for one's corrupt congressional critter to do something, which will never happen if that something is against the will of the largest lobbying client, or one can take matters into their own hands. The latter is what disgruntled Libyans did moments ago. From Reuters:

  • GUNMEN STORM LIBYAN PARLIAMENT, START SHOOTING AND FORCE LAWMAKERS TO ABANDON VOTE ON NEXT PM -SPOKESMAN
  • SEVERAL PEOPLE WOUNDED BY SHOOTING AT LIBYA'S PARLIAMENT, GUNMEN ARE ALLIED TO ONE OF THE DEFEATED PM CANDIDATES -SPOKESMAN

It may not be the most polite way to get one's views across but it gets the job done. But more importantly, when it comes to the epic chaos that is post-CIA intervention Libya, what difference does it make if parliament is stormed by enraged vigilantes?

 
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China Slams US Over Russian Sanctions; Warns "Will Escalate Tensions"





Having previously called Russia a "good neighbor, good partner, and good friend," it seems increasingly clear that the West faces not just Russia but China too as it brings more sanctions to bear. As The BRICS Post reports, Beijing announced its support for a beleaguered Moscow, calling on all parties to resolve the crisis, and warning that they "believe that sanctions are inconducive to the solution of problems. On the contrary, they will escalate tensions."

 
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Relax! SEC's Mary Jo White Says "Markets Are Not Rigged" - Live Feed





During her testimomy to the House Financial Services Committee, SEC's Mary Jo White confidently proclaimed (despite her questioner doubting her beliefs):

US SEC CHAIR MARY JO WHITE RESPONDS TO MICHAEL LEWIS BOOK IN TESTIMONY, TELLS CONGRESS "THE MARKETS ARE NOT RIGGED"

"Investors should be protected from shisters," blasted the committee member, as he took White to task..

 
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Gold Fix Manipulation Crackdown: Deutsche Officially Resigns London Fix Seat





Three months ago, we discussed the increasingly close eye that regulators were keeping on Deutsche Bank (and in fact many other precious metal fix providers) as manipulation concerns shifted from conspiracy theory to conspiracy fact. At the time, Deutsche - among other banks - had suggested it would relinquish its role on the London Fixing committee and was actively marketing its seat to other LBMA members - it failed to find a willing buyer; the WSJ now confirms...

DEUTSCHE BANK SAID TO BE UNABLE TO FIND BUYER FOR GOLD SEAT
DEUTSCHE BANK RESIGNS SEAT ON GOLD, SILVER FIX, GIVES TWO WEEKS NOTICE - SOURCE

This is hardly surprising given previous comments that possible manipulation of precious metals "is worse than the Libor-rigging scandal." but it does leave us wondering who is left to do the manipulating? It seems no one wants to be part of the fixing process (critical for so many derivatives contracts) unless they are allowed to manipulate it to their own needs.

 
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Consumer Confidence Misses; Present Situation Tumbles Most In 15 Months





After March's exuberant surge to the higest level since Jan 2008, serial extrapolators drew their lines and proclaimed that Consumer Confidence would jump further to 83.2 - it didn't. Confidence dropped from a revised 83.9 to 82.3 as Present Situation dropped its most in 15 months. Hope (expectations) remains at its highest in 8 months but plans to buy a car dropped to 1 year lows  (with its biggest 2-month drop in 11 years) and plans to buy a major appliance dropped to 5 month lows.

 
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World's Largest Pork Supplier Pulls Asia's Biggest IPO For 2014 Due To "Deteriorating Market Conditions"





In light of deteriorating market conditions and recent excessive market volatility, the company, having consulted the joint sponsors, has decided that the global offering will not proceed at this time.”

 
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Un-De-Escalation Fears Spike Gold And Oil, Stocks Don't Care (Yet)





Since the headlines hit this morning of further escalation in Ukraine, no troop withdrawals and more building takeovers, gold and oil prices have surged higher as it is clear that any hope for de-escalation is just that - hope. Treasury yields remain up but notably less than equity markets would imply by their move as safe haven demand is confused with rate-locks for the massive AAPL new issue (and are misread by stocks as being bullish). Equity markets, of course, don't care, JPY leads the way and there are stops to run and it's Tuesday...

 
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Icahn And Ackman Have Kissed And Made Up





CNBC must be reeling this morning as probably the highest-rated rivalry among hedge-fund managers has ended. As The WSJ reports, the hatchet was buried on Thursday. Mr. Ackman spoke with Mr. Icahn's assistant on April 24 saying, "I am calling to forgive Carl," according to Mr. Ackman. Mr. Icahn, 78 years old, returned the call and told Mr. Ackman, 47, that "it is a blessing to forgive," Mr. Icahn said, "and I forgive you." The acrimonious activists thus closed the door on one of the ugliest spats in financial market history as forgiving being called "a crybaby" and forgetting being labelled "a dishonest man" has been trumped by. as Ackman notes, the "much greater possibility that we are on the same side than the opposite."

 
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Case-Shiller Has Longest Home Price Decline Stretch Since 2012; 13 Of 20 Cities See Price Drops





Even Case Shiller itself appears to have given up on housing as the driver of the wealth effect: "Five years into the recovery from the recession, the economy will need to look to gains in consumer  spending and business investment more than housing. Long overdue activity in residential  construction would be welcome, but is certainly not assured." And looking at actual city level data, we find that just 5 cities saw price increases in February; 13 of 20 cities saw their home prices decline.

 
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Active Shooter At FedEx Facility In Atlanta: 6 Gunned Down, FBI On Scene - Live Feed (UPDATE: Shooter Dead)





UPDATE: Shooter found dead - from self-inflicted gunshot wound

Police are looking for a man (reportedly a baggage handler) suspected of shooting six people at the FedEx facility in Kennesaw. As NBC11 reports, the shooting occurred at 545am as the male suspect arrved at the facility and started shooting:

*POLICE CONFIRM 6 INJURED IN SHOOTING AT GEORGIA FEDEX FACILITY
*POLICE SAY 'ACTIVE AND FLUID' SITUATION AT FEDEX BUILDING

The facility is on lockdown with workers already at work being held in a warehouse and new arrivals turned away.

 
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No Deescalation: Separatists Storm Another Ukraine Administration Building; NATO Says No Troop Withdrawal





Another false de-escalation gambit in Ukraine, after as Reuters reported earlier, "NATO has seen no sign that tens of thousands of Russian troops are withdrawing from close to the Ukraine border, a NATO official said today, despite a Russian statement that the troops had returned to their permanent positions." But... the algos said that all is well again? Guess not. But perhaps the best example of what is really going on, we read this:

PROTESTERS STORMING REGIONAL BUILDING IN LUHANSK: INTERFAX
PRO-RUSSIA SEPARATISTS CONTROL ADMIN. BUILDING IN LUHANSK: RIA

Interfax adds that some of protesters are carrying sticks, batons, and probably other pain-creating objects. Oh well, the "de-escalation" was fun while it lasted. Back to the same old daily grind again.

 
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Apple Files To Sell Seven Part, Multi-Billion Debt Offering





In what turned out to be immaculate timing, it was only yesterday that we previewed the collapse in Apple's domestic cash hoard (at the expense of its soaring, if non-recourse offshore cash)  which we concluded by saying that "what this simply means is that after making the history books with the biggest ever, $17 billion bond offering 12 months ago, Apple is about to issue a whole lot more of debt." Less than 24 hours later, it did just that. Moments ago Apple filed a bond offering prospectus, in which it laid out a 7-part bond offering consisting of two FRN tranches (due 2017 and 2019), and 5 fixed rate tranches (due 2017, 2019, 2021, 2024 and 2044), with Goldman and Deustche Bank as lead underwrtiers.

 
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