Author Archive for Zero Hedge

Central Banks Are “Malicious Tools Of Wholesale Cultural Destruction”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Originally posted at The Daily Bell,

Stock markets suspect Federal Reserve has interest rate jitters … Hints that the Fed won't raise interest rates in March are proving to be good news for miners and oil producers' share prices The Federal Reserve's William Dudley said further strengthening in the dollar could have 'significant consequences' for the health of the US economy. – UK Guardian

Blame it on the dollar!

The Federal Reserve hiked a tiny bit and markets around the world plunged. This is the big story that implies the further loss of Fed credibility.

But there is an even bigger one that we'll discuss at the end of this article.

Let's continue with this Guardian analysis. The reporting is along the lines we would expect: We learn that market players have come to the logical conclusion that the Fed is not going to raise interest rates again any time soon.

Or even if they do "raise" them, they'll have a negligible impact on real rates.

On Thursday, large stocks moved up and reports circulated that Fed officials were continuing to have "second thoughts" about a series of rate hikes. Here, more from the Guardian:

William Dudley, a top Fed official, said on Wednesday that monetary conditions had tightened since December's quarter-point rise and rate setters would have to take note. Further strengthening in the dollar, added Dudley, could have "significant consequences" for the health of the US economy. Translation: the Fed probably won't raise in March.

The dollar then sold off yesterday, while commodity prices rose, especially the share prices of miners and oil and gas producers. It was quite a clever statement, helping move the dollar down and the market up.

Even more importantly, it began the process of Fed damage control. The Fed hike had not merely bashed stocks, it had buttressed the dollar.

A stronger dollar, Dudley says, may preclude further near-term rate hikes. Thus, the Fed, conveniently, doesn't have to acknowledge – directly, anyway – that further hikes are on hold because of damage done to equities.

That would be embarrassing!

Of course, there are additional sub-plots, one courtesy of Goldman Sachs, as reported in the Australian Financial Review:

US Federal Reserve will lift rates higher than market thinks: Goldman Sachs' US economist Jan Hatzius predicts the


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The World Is Turning Japanese

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Nearly a year ago, Bank of Japan governor Haruhiko Kuroda described the unlikely inspiration behind Japan’s unprecedented monetary stimulus: Peter Pan.

I trust that many of you are familiar with the story of Peter Pan, in which it says, ‘the moment you doubt whether you can fly, you cease forever to be able to do it’. Yes, what we need is a positive attitude and conviction. Indeed, each time central banks have been confronted with a wide range of problems, they have overcome the problems by conceiving new solutions.

As VisualCapitalist's Jeff Desjardins notes, Kuroda’s optimism is desperately needed in a country that has now been officially “leapfrogged” by the four Asian Tigers in terms of Real GDP per capita (PPP). With over a decade of experimentation in extreme monetary policy under their belts, Japan has very little to show for it.

It would be fine if this story of economic malaise could be confined as a global outlier. However, recent circumstances have prodded the world’s central bankers to finally buy into the tale of Peter Pan.

The world is turning Japanese.

Courtesy of: Visual Capitalist

So Much Negativity

Negative interest rates were an economic pipe dream many decades ago, but the idea of “charging” interest to hold money is now becoming mainstream. Conventional wisdom was that depositors would just hoard cash rather than depositing at a cost, but now the people running central banks are beginning to believe that this fear is misplaced. Especially as society becomes more cashless, the inconvenience of withdrawing money to save a few bucks isn’t worth it.

Central banks in Switzerland, Sweden, Denmark, and Japan now all have negative interest rates. The ECB has also held their Deposit Facility Rate for overnight deposits in the negative since June 2014.

In recent weeks, the interest in this economic experiment has risen significantly. Sweden cut their rates deeper into negative territory, signalling to the rest of the world that there is nothing to fear. Meanwhile, both the Federal Reserve and the Bank of Canada have openly pondered the possibility of NIRP in their respective jurisdictions.

Misplaced Conviction?

Not everyone agrees with the central bankers in seeing the Peter Pan analogy to be a fitting representation.

We’d liken it…
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US Allies Are Now Fighting CIA-Backed Rebels In Syria

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Claire Bernish via TheAntiMedia.org,

On the same day Syrian President Bashar al-Assad claimed his fighters would retake the entire country “without hesitation,”unnamed American defense officials revealed to the Daily Beast that the same Iraqi militias who were previously fighting ISIL alongside the U.S. are now actively collaborating with Russian and Iranian forces to “crush” American-backed rebels in Aleppo. According to the report:

“At least three Shia militias involved in successful battles against ISIS in Iraq — the Badr Brigade, Kata’ib Hezbollah, and the League of the Righteous — have acknowledged taking casualties in fighting in south and southeast Aleppo province. U.S. defense officials confirmed to The Daily Beast that they believe ‘at least one’ unit of the Badr Brigade is fighting in southern Aleppo alongside other Iraqi militia groups. Those groups are backed by Russian airpower and Iranian troops — and all of whom are bolstering President Bashar al-Assad’s Syrian Arab Army.”

Telling of the complex quagmire, the report indicates the same Shia militias fighting with the U.S. to maintain its installed government in Iraq are battling against the U.S.-backed forces – including those armed by the CIA – by bolstering Russian and Iranian efforts to bring control of the Syrian city back to Assad.

Of course, Saudi Arabia recently entered the Syrian theater under the premise of fighting ISIL, though as Saudi Foreign Minister Adel al-Jubeir reiterated on Friday, according to Al-Jazeera, “Unless and until there is a change in Syria, Daesh [IS, ISIS, ISIL] will not be defeated in Syria.” Reinforcing, to a degree, the U.S. stated purpose in Syria of deposing Assad, he added,“When Assad goes, the fertile environment which Daesh operates in Syria will be removed.”

As part of a tentative agreement among the major players in the Syrian imbroglio, including the U.S., Saudi Arabia, Russia, and Iran, there will be a cessation of hostilities which was set to begin yesterday – though that arrangement excludes ISIL and Jabhat al-Nusra, and shortly after negotiations, Russian airstrikes reportedly continued in Homs in earnest.

As Phillip Smyth of the University of Maryland, who studies Shia militias, said, “It is clear Iran is routing as many fighters as possible to Syria, particularly on the Aleppo front,” reported the Daily Beast.

Though murky politics and shifting or seeming contradictory alliances persist
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Presidents Day (For Millennials)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

“Change” you just can’t believe…

Source: Investors.com





NWO (revisited again and again)…

Courtesy of ZeroHedge. View original post here.

Submitted by williambanzai7.

HILLARY CRONY





“Autocracy” Vs. “Democracy”: Stunning Before And After Pictures Of Syria’s Largest City

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

As we documented last autumn in “Syria Showdown: Russia, Iran Rally Forces, US Rearms Rebels As ‘Promised’ Battle For Aleppo Begins,” Syria’s largest city has been among the hardest hit of the country’s urban centers over the course of the last five years.

Newsweek documented the destruction in a series of stark and profoundly indelible images in 2012, perhaps the most striking of which was this:

Recapturing the city is critical to restoring Bashar al-Assad’s grip on power.

If Aleppo is liberated, the rebellion will be all but crushed. The Alawite government would once again control the country’s urban backbone in the west and, more importantly from a big picture perspective, Iran would have scored a major victory in the effort to preserve the Shiite crescent not to mention its supply lines to Hezbollah.

Likewise, a victory at Aleppo would invalidate US claims that Vladimir Putin was destined to get Moscow into a “quagmire” in Syria and the Russians would score a major geopolitical coup by effectively replacing the US as Mid-East superpower puppet master.

As for the Gulf monarchies, the demise of the Sunni insurgency in Syria would be a bitter blow. The effort to roll back Iranian influence would be forever remembered as an abject failure and Tehran would score sectarian bragging rights over Riyadh just as international sanctions are lifted and Iran ramps up crude production.

So important is the battle for the city that Quds commander Qassem Soleimani himself supervised the initial stages of the push north from Latakia before disappearing into thin air in November only to resurface two days ago at a rally celebrating the Islamic Revolution. 

Now that the eyes of the world are on Aleppo which may well go down in history as the site where World War III began, we thought it an opportune time to bring you the following before and after images which depict what life was like in the city under the “brutal dictatorship” of Bashar al-Assad and what life is like now that the US has exported democracy to Syria.

Autocracy:

Democracy:

Autocracy:

Democracy:

Autocracy:

Democracy:

Autocracy:

Democracy:

Autocracy: 

Democracy:

“Yes we can”… destroy the entire Middle East…

h/t: @BBassem7 and @lika__333





What Happens Next?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

With so much riding on the American "consumer" – given the collapse of the US manufacturing industry and massive mal-investment over-stocking falsely signalled by The Fed's "help" – one wonders just what happens next as the Services economy begins to roll over and the gap between the consumer and industrial America – which has never, in over 30 years, been wider – converges back to a new normal dystopia.

It's different this time…

And while Goldman desperately does not want to admit reality, they are forced to… but manage to find a possible silver lining…

The industrial and non-industrial parts of the economy have recently disconnected for only the third time in the past 40 years.

The Current Activity Indicator (CAI) represents a real-time proxy of economic activity. Like GDP, the CAI may be sub-divided into components. Industrial and non-industrial measures of activity are usually highly correlated. The gap reflects the collapse in oil prices and drag on industrial activity.

The most analogous precedent is 1986 when crude prices dropped by 70% in six months and industrial demand plummeted. However, during that episode the consumer remained healthy and continued to spend, the US avoided a recession, and equities climbed. A similar pattern may occur in 2016.

So now that comparisons with 1998 are thrown out of the window, the last saving grace is whether it is 1986… but we all know what happened after that (as reality once again set in)…





Supreme Court Justice Antonin Scalia Found Dead At West Texas Ranch

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Moments ago the judicial world was hit with what is the most significant news since the passage of Obamacare, when the San Antonio Express first reported that one of the more, if not most, conservative Supreme Court Justices, Antonin Scalia, was found dead of apparent natural causes Saturday on a luxury resort in West Texas, federal officials said. Scalia, 79, was a guest at the Cibolo Creek Ranch, a resort in the Big Bend region south of Marfa.

According to the initial report, Scalia arrived at the ranch on Friday and attended a private party with about 40 people. When he did not appear for breakfast, a person associated with the ranch went to his room and found a body. Chief U.S. District Judge Orlando Garcia, of the Western Judicial District of Texas, was notified about the death from the U.S. Marshals Service.

U.S. District Judge Fred Biery said he was among those notified about Scalia’s death.

“I was told it was this morning,” Biery said of Scalia’s death. “It happened on a ranch out near Marfa. As far as the details, I think it’s pretty vague right now as to how,” he said. “My reaction is it’s very unfortunate. It’s unfortunate with any death, and politically in the presidential cycle we’re in, my educated guess is nothing will happen before the next president is elected.”

A federal official who asked not to be named said there was no evidence of foul play and it appeared that Scalia died of natural causes.

According to CNN, Scalia died in his sleep. A government official said Scalia went to bed Friday night and told friends he wasn’t feeling well. Saturday morning, he didn’t get up for breakfast. And the group he was with for a hunting trip left without him. Someone at the ranch went in to check on him and found him unresponsive.

The U.S. Marshal Service, the Presidio County sheriff and the FBI were involved in the investigation. Officials with the law enforcement agencies declined to comment.

A gray Cadillac hearse pulled into the ranch last Saturday afternoon. The hearse came from Alpine Memorial Funeral Home.

Texas governor Abbott confirmed the news:


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This Is Wall Street At Its Most Fatalistic: “Markets Are Now Coupled In A “Destructive” Way”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

The text that follows may be the best summary of what has happened on Wall Street – both forensically and philosophical – over the past 7 years, explaining how central banks broke the “market”, and why traders, investors, regulators, policy makers, and everyone else suddenly has no idea either what is going on or what to do next. Not surprisingly, it comes from Deutsche Bank, which this week has been staring at the corpe of Lehman Brothers and wondering if it is next…

From DB’s Aleksandar Kocic

Asphyxiation — code orange?

We believe for the past few weeks we’ve been experiencing an accelerated reaction to a policy mix that caused a general shift in perception of risk from isolated idiosyncratic flare-ups to pseudo systemic. The mix is defined by seven years of unprecedented liquidity injection with low rates and record low volatility on one side, and bank regulation with diminished capacity of the market to extend liquidity on the other.

The first effect alone has three major consequences. Low rates had been making UST investments unattractive (expensive). So, investors sought yield elsewhere. This is where low volatility played the role. Portfolio managers adjust their position on the mean-variance frontier by matching their risk limits to a particular return. Extinguishing volatility pushes them towards riskier assets without a need to change their risk limits. This was ok as long as volatility remained low. Instead of investing in UST, duration players moved across the credit line into IG, HY, etc., which offered higher yield and superior carry. In these markets carry becomes the main theme and everyone who refuses to play that game is punished by high negative carry. This was stimulating for risk, and risk assets outperformed in low rates and low volatility environment. Correlations between risk assets and yields changed sign, but nobody complained because both stocks and bonds rallied.

Negative carry of any contrarian position was punitive which resulted in massive one-sided positioning. The problems began with the start of stimulus unwind as all of its underlying aspects began to reinforce each other and regulatory environment amplifies their effect.

There is a huge overweight in relatively illiquid assets. While positioning grew, regulation has significantly diminished dealers’ capacity to absorb those unwinds, which would have been difficult even without the regulatory restrictions. Volatility is on…
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Socialism & The Battle Of Ideas

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Authored by Ludwig von Mises via The Mises Institute,

[This article is excerpted from Socialism: An Economic and Sociological Analysis]

It is a mistake to think that the lack of success of experiments in Socialism that have been made can help to overcome Socialism. Facts per se can neither prove nor refute anything. Everything is decided by the interpretation and explanation of the facts, by the ideas and the theories.

The man who clings to Socialism will continue to ascribe all the world's evil to private property and to expect salvation from Socialism. Socialists ascribe the failures of Russian Bolshevism to every circumstance except the inadequacy of the system. From the socialist point of view, Capitalism alone is responsible for all the misery the world has had to endure in recent years. Socialists see only what they want to see and are blind to anything that might contradict their theory.

Only ideas can overcome ideas and it is only the ideas of Capitalism and of [Classical] Liberalism that can overcome Socialism. Only by a battle of ideas can a decision be reached.

Liberalism and Capitalism address themselves to the cool, well-balanced mind. They proceed by strict logic, eliminating any appeal to the emotions. Socialism, on the contrary, works on the emotions, tries to violate logical considerations by rousing a sense of personal interest and to stifle the voice of reason by awakening primitive instincts.

Even with those of intellectually higher standing, with the few capable of independent reflection, this seems to give Socialism an advantage. With the others, the great masses who are unable to think, the Socialist position is considered unshakable. A speaker who inflames the passions of the masses is supposed to have a better chance of success than one who appeals to their reason. Thus the prospects of Liberalism in the fight with Socialism are accounted very poor.

This pessimistic point of view is completely mistaken in its estimate of the influence which rational and quiet reflection can exercise on the masses. It also exaggerates enormously the importance of the part played by the masses, and consequently mass-psychological elements, in creating and forming the predominant ideas of an epoch.

It is true that the masses do not think. But just for this reason they follow those who do think. The intellectual guidance…
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Phil's Favorites

Should You Be 100% Long Stocks?

 

Should You Be 100% Long Stocks?

Courtesy of Joshua Brown

The New York Times is out with an investing column that posits the following: You should be 100% stocks in your portfolio because, given enough time, they should outperform everything else you can possibly own in an investment account.

And here is the data that “proves” it – as long as you’re willing to bet that the future will look precisely like the past:

I’m troubled by this idea, although I do agree that there are select cases where this could make sense. The author is David A. Levine, a former chief economist at Sanford C. Bernstein & Company. And, to his credit, he does pay lip service to the...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Global trade is worse than it was during the financial crisis (Business Insider)

"It is worse than in 2008. The oil price is as low as its lowest point in 2008-09 and has stayed there for a long time and doesn't look like going up soon. Freight rates are lower. The external conditions are much worse."

Bond Investors Looking Out for Stimulus Hint in Draghi Testimony (Bloomberg)

Investors will look next week for a whiff of confirmation from Mario Draghi that they weren’t wrong to push bond yields to record...



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Zero Hedge

Central Banks Are "Malicious Tools Of Wholesale Cultural Destruction"

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Originally posted at The Daily Bell,

Stock markets suspect Federal Reserve has interest rate jitters ... Hints that the Fed won't raise interest rates in March are proving to be good news for miners and oil producers' share prices The Federal Reserve's William Dudley said further strengthening in the dollar could have 'significant consequences' for the health of the US economy. – UK Guardian

Blame it on the dollar!

The Federal Reserve hiked a tiny bit an...



more from Tyler

Chart School

Power of Mean Reversion

Courtesy of Read the Ticker.

The power of reverting to the mean. Life time buys, or miserable bust! The rubber band does smack back eventually!

More from RTT Tv




NOTE: readtheticker.com does allow users to load objects and text on charts, however some annotations are by a free third party image tool named Paint.net

Investing Quote...

.."There is a time for all things, but I didn’t know it. And that is precisely what beats so many men in Wall Street who are very far from being in the main sucker class. There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks h...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Kimble Charting Solutions

Big test for those that have been wrong, says Joe Friday

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

In May of last year, the S&P hit a key level and stopped on a dime. We applied Fibonacci tools to the highs in 2007 and the lows in 2009, to the chart above. The 161% Fibonacci extension level came into play in the 2,150 zone last year and when hit at (1), the markets stopped on a dime.

If your tools or adviser has suggested to be long and strong since May of 2015, that advice has been costly.

Our take, “Free advice that is wrong, is expensive!!!”

Below looks at stock i...



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OpTrader

Swing trading portfolio - week of February 8th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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ValueWalk

Why Most Investors Fail in the Stock Market

 

Why Most Investors Fail in the Stock Market

Courtesy of ValueWalk, by  

Throughout the past 30 days of wild volatility, here’s what I didn’t do.

Panic. Worry. Sell.

In fact, the best I did was add to a couple of positions yesterday. The world was already in an uncertain state for the past 3+ years. It’s just that with the market rising, we pushed the issue to the back of our  mind and ignored it.

If you read Howard Marks latest memo, ...



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Digital Currencies

2016 Theme #3: The Rise Of Independent (Non-State) Crypto-Currencies

Courtesy of Charles Hugh-Smith at Of Two Minds

A number of systemic, structural forces are intersecting in 2016. One is the rise of non-state, non-central-bank-issued crypto-currencies.

We all know money is created and distributed by governments and central banks. The reason is simple: control the money and you control everything.

The invention of the blockchain and crypto-currencies such as Bitcoin have opened the door to non-state, non-central-bank currencies--money that is global and independent of any state or central bank, or indeed, any bank, as crypto-currencies are structurally peer-to-peer, meaning they don't require a bank to function: people can exchange crypto-currencies to pay for goods and services without a bank acting as a clearinghouse for all these transactions.

This doesn't just open t...



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Sabrient

Sector Detector: New Year brings new hope after bulls lose traction to close 2015

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Chart via Finviz

Courtesy of Sabrient Systems and Gradient Analytics

Last year, the S&P 500 large caps closed 2015 essentially flat on a total return basis, while the NASDAQ 100 showed a little better performance at +8.3% and the Russell 2000 small caps fell -5.9%. Overall, stocks disappointed even in the face of modest expectations, especially the small caps as market leadership was mostly limited to a handful of large and mega-cap darlings.

Notably, the full year chart for the S&P 500 looks very much like 2011. It got off to a good start, drifted sideways for...



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PSW is more than just stock talk!

 

We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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Pharmboy

Baxter's Spinoff

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

Baxter Int. (BAX) is splitting off its BioSciences division into a new company called Baxalta. Shares of Baxalta will be given as a tax-free dividend, in the ratio of one to one, to BAX holders on record on June 17, 2015. That means, if you want to receive the Baxalta dividend, you need to buy the stock this week (on or before June 12).

The Baxalta Spinoff

By Ilene with Trevor of Lowenthal Capital Partners and Paul Price

In its recent filing with the SEC, Baxter provides:

“This information statement is being ...



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Mapping The Market

An update on oil proxies

Courtesy of Jean-Luc Saillard

Back in December, I wrote a post on my blog where I compared the performances of various ETFs related to the oil industry. I was looking for the best possible proxy to match the moves of oil prices if you didn't want to play with futures. At the time, I concluded that for medium term trades, USO and the leveraged ETFs UCO and SCO were the most promising. Longer term, broader ETFs like OIH and XLE might make better investment if oil prices do recover to more profitable prices since ETF linked to futures like USO, UCO and SCO do suffer from decay. It also seemed that DIG and DUG could be promising if OIH could recover as it should with the price of oil, but that they don't make a good proxy for the price of oil itself. 

Since...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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