Guest View
User: Pass: | become a member
Author Archive for Zero Hedge

The Austrian Case Against Economic Intervention

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Patrick Barron via Mises Canada,

The basic unit of all economic activity is the un-coerced, free exchange of one economic good for another based upon the ordinally ranked subjective preferences of each party to the exchange. To achieve maximum satisfaction from the exchange each party must have full ownership and control of the good that he wishes to exchange and may dispose of his property without interference from a third party, such as government. The exchange will take place when each party values the good to be received higher than the good that he gives up. The expected, but by no means guaranteed, result is a total higher satisfaction for both parties. Any subsequent satisfaction or dissatisfaction with the exchange must accrue completely to the parties involved. The expected higher satisfaction that one or each expects may not be dependent upon harming a third party in the process.

Several observations can be deduced from the above explanation. It is not possible for a third party to direct this exchange in order to create a more satisfactory outcome. No third party has ownership of the goods to be exchanged; therefore, no third party can hold a legitimate subjective preference upon which to base an evaluation as to the higher satisfaction to be gained. Furthermore, the higher satisfaction of any exchange cannot be quantified in any cardinal way, for each party’s subjective preference is ordinal only. This rules out all utilitarian measurements of satisfaction upon which interventions may be based. Each exchange is an economic world unto itself. Compiling statistics of the number and dollar amounts of many exchanges is meaningless for other than historical purposes, both because the dollars involved are not representative of the preferences and satisfactions of others not involved in the exchange and because the volume and dollar amounts of future exchanges are independent of past exchanges.

Let us examine a recent, typical exchange that violates our definition of a true exchange yet is justified by government interventionists today–subsidized, protected, and mandated use of ethanol. Number one, the use of ethanol is coerced; i.e., the government requires its mixture into gasoline. Government does not own the ethanol, so it cannot possibly hold a valid subjective preference. The parties forced to buy ethanol actually receive some dissatisfaction. Had they desired to purchase…
continue reading





Meet The Future Of Trading: A 25-Year-Old… Math PhD

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Forget the middle-aged belt-and braces stockbroker who ‘knows’ a good stock. Ignore the 5-star tech analysts who never saw a startup he didn’t like (with your money). Meet 25-year-old math PhD Sam Barnett, CEO of SBB Research – a quant hedge fund – who, instead of wild extrapolations and Keynesian hockey-sticks, trades the market by “using data to mine information before it is encoded into the markets.”

 

While several of the CNBC team flounders to show why their commissions are worth it, and why a 25-year-old could not possibly ‘know’ anything, we for once agree with their premise – this IS the future of trading – 25-year-old math PhDs mining data faster than a fat finger can press buy.





Name The Exponential Chart

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

It’s not just the exponential rise in US debt that threatens the future ‘freedom’ of Americans…

 

Source: Goldman Sachs

 

Answer here (guess first!!)





Former Airline CEO Claims US Military Shot Down MH370 Near Diego Garcia

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

A second senior airline industry source has revealed his belief that there is some sort of conspiracy behind the disappearance of Malaysia Airlines flight MH370. As The Herald Sun reports, Emirates president and CEO Sir Tim Clark made world headlines in October when he revealed his doubts about the fate of the missing plane, which disappeared early in the morning of March 8 this year. Now a second senior airline industry source has voiced his doubts about the fate of the plane, with the even wilder claim that the Boeing 777 may have been shot down by US military personnel who were fearing a September 11-style attack on the US Navy base on Diego Garcia.

 

As The Herald Sun reports,

Now a second senior airline industry source has voiced his doubts about the fate of the plane, with the even wilder claim that the Boeing 777 may have been shot down by US military personnel who were fearing a September 11-style attack on the US Navy base on Diego Garcia.

 

The former boss of Proteus Airlines, Marc Dugain, put forward his theory that the Malaysia Airlines plane crashed near the remote Indian Ocean island in a recent edition of Paris Match.

 

Dugain speculated that the plane’s computers may have been subject to a remote hacking, or an on-board fire, which prompted a diversion from its flight path.

 

Diego Garcia is a British territory but has been used as a significant US military base and refuelling stop since the 1970s. It is currently home to 1700 military personnel and 1500 civilian contractors.

Many conspiracy theories about the island have been aired since the disappearance of MH370, but the US government has repeatedly denied that the plane came anywhere near the remote territory, which is 3600km from Africa’s east coast and 4700km northwest of Australia.

 

Dugain said the downing of the plane may have come about for a range of different reasons, including the possibility that it may have been shot out of the sky by the US military, who were fearing a September 11-style attack on the base.

 

He pointed to the testimony of residents of the Maldives, who reported seeing an airliner travelling towards Diego Garcia on March 8,


continue reading





How Japan Bankrupted Itself – Lessons For Europe

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Daniel Stelter via The Globalist blog,

Following the start of Abenomics in 2012, Japan moved back to the center of attention of global financial markets. After two and a half decades of economic stagnation, hopes were high that Japan would escape its long stagnation and deflation.

Plenty of economists around the globe hoped that, in so doing, Japan would show the western world, mainly the Eurozone, the way to do the same and avoid a similar long period of low growth and stagnating incomes.

Conversely, the failure of Abe’s plan for Japan’s recovery would not only be a disaster for the country of the rising sun.

It would also be very bad news for central bankers and politicians in the west as well. It would prove that Keynesian policies don’t work in a world of too much debt and shrinking populations.

To assess the probabilities of these scenarios, it is worthwhile to have a deeper look on how Japan ended up in the current economic malaise.

The erstwhile poster child

Japan served globally as a role model for economic development in the 1980s. After an economic miracle following the Second World War, Japanese companies started to dominate in leading industries like machinery and equipment, automotive and consumer electronics.

Similar to today’s views on China, back then books explaining the Japanese miracle and describing the unstoppable rise of the nation to the leading economic powerhouse of the world were highly popular around the globe.

Japanese corporations also began to invest in prestigious artwork and trophy real estate assets around the world. When the Japanese bubble – like all bubbles – deflated from 1990 onwards, asset prices collapsed. However, credit levels in Japan remained high.

Japan acted just as the Keynesian textbook prescribes. It compensated a deep drop in domestic demand with higher government expenditures. As a result, many companies, which in reality were insolvent, were not restructured – but kept alive with low interest rates and bridge financing.

What happened over the past 25 years is simple: Japan’s corporate sector was a net saver and reduced its leverage. Private households also reduced their savings significantly, from levels of 20% to 3% today. Finally, the Japanese government built up a huge debt load, rising from about 50% of GDP at the end of the 1980s
continue reading





Monday Humor: Now Available With A 30 Year Fixed-Rate FHA Loan

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

"Because moar is always betterer…"

 

h/t @Stalingrad_Poor

 

It seems the reviewers had more to say…

 

And the Q&A also provided some insight…

 

So sure enough – too much demand…

 

Source: Amazon.com





The Doom Boom: US Families Increasingly Prepared For “Modern Day Apocalypse”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

From the outside America may seem to be a land of endless optimism and confidence. But, as Sky News reports, an increasing number of Americans seem to think it is danger of falling apart, and they're preparing for the end. "We're not talking about folks walking around wearing tin foil on their heads,; we're not talking about conspiracy theorists. I'm talking about professionals: doctors and lawyers and law enforcement and military. Normal, everyday people. They can't necessarily put their finger on it. But there's something about the uncertainty of our times. They know something isn't quite right."

 

A now-privately-held ex-nuclear-missile base in Kansas has been turned into luxury "post-apocalyptic refuge for the very rich"

"It's an undergorund complex straight out of a bond flick"

 

As Sky News reports,

They call themselves preppers. Mainstream suburban Americans hoarding supplies and weapons while leading otherwise perfectly normal lives.

 

 

[they are] afraid of some impending catastrophe but also what that will do to American society.

 

"I think that is what I'm scared of the most," he told Sky News, "Not the actual events. I've already prepared for that. It's the aftermath, when there are no police, there are no military to protect us, we're going to be protecting ourselves."

 

The trigger could be a terrorist attack, a monetary collapse, cataclysmic failure in power generation, or a natural disaster. Preppers fear what comes next and have no faith in either their government or human nature.

 

"Once people use up all their resources, they're going to come after the people that prepared and had more resources. So basically we have to take care of ourselves."

 

 

"We're not talking about folks walking around wearing tin foil on their heads," Jay tells Sky News. "We're not talking about conspiracy theorists.

 

"I'm talking about professionals: doctors and lawyers and law enforcement and military. Normal, everyday people. They can't necessarily put their finger on it. But there's something about the uncertainty of our times. They know something isn't quite right."

 

Jay is a celebrity in the strange but increasingly mainstream world of preppers, writing prepper books and touring America, speaking at prepper expos where a bewildering range of survival supplies and


continue reading





Ukraine Central Bank Conned Into Swapping Its Gold For Lead Bricks

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Just when one thought the story of Ukraine and its (now non-existant) gold could not get any more surreal, it did.

As a reminder, it was about a month ago when we learned courtesy of an interview on Ukraine TV with the country’s central bank head Valeriya Gontareva, that Ukraine’s gold was virtually all gone, when she made the stunning admission that “in the vaults of the central bank there is almost no gold left. There is a small amount of gold bullion left, but it’s just 1% of reserves.”

That in itself would have been sufficient to explain why just a few short days later, the Netherlands shocked the world when it announced it had secretly repatriated 122 tonnes of gold from the NY Fed, and had the story of Ukraine’s missing gold ended there (or even with the criminal probe launched by Ukraine whether the central bank head had abused her power and misused her office when she “intentionally committed an extremely unfavorable transaction for the gold and forex reserves of Ukraine”), it still would have been one of the most bizarre, surreal stories of 2014.

Luckily, the story just got far better, and far, far more bizarre and surreal.

As Bloomberg reports, Ukraine opened a criminal probe after several gold bars at the central bank’s storage in the southern city of Odessa turned to be painted lead.

“The management of the central bank’s branch in Odessa asked us to investigate fraud by their employee,” Volodymyr Shablienko, head of the Odessa police’s press office, said by phone today. “We are conducting a forensic audit now.”

As Bloomberg explains, the latest gold fraud involved a central bank employee passing lead bars covered with golden paint to the storage unit, registering them as gold, the Vesti newspaper reported today, citing an unidentified person with knowledge of the matter in Odessa’s police department.

According to additional information from RT, the central bank was actually conned into buying the gold-plated lead.

Yes lead, not even tungsten.

RT adds that the National Bank of Ukraine (NBU) has confirmed the theft of several kilograms of gold in the Odessa region. The cashier involved has apparently fled to Crimea, Vesti Ukraine reports. Criminal…
continue reading





NYC Mayor de Blasio Slams Reporters For “Enabling” Racial Hatred

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

New Yokr Mayor de Blasio had strong ‘not-my-fault’ words for the media during today’s press conference about the assassination of 2 NYPD cops over the weekend. De Blasio begins blasting media, “What are you guys gonna do? … Are you going to keep dividing us?” He then gets on a roll and blames reporters for inciting protesters to confront police – “you all
[reporters] enable that [racial divide]… that’s how you want to
portray the world.” Yep – all their fault…

 

At around 51:30 De Blasio begins blasting media, “What are you guys gonna do? … Are you going to keep dividing us?”

At 53:00, De Blasio blames reporters for inciting protesters to confront police – “you all [reporters] enable that [racial divide]… that’s how you want to portray the world.”

At 56:30, Commissioner Bratton notes “do some officers not like this mayor?  Guaranteed!”

 





This Is For You Steve Liesman… Welcome To Economics

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Thad Beversdorf via First Rebuttal blog,

I stumbled onto one of Peter Schiff’s radio shows and it was the one where he discusses CNBC chief economic correspondent, Steve Liesman’s call that the American economy needs more consumer debt, which is right in line with the Keynesian theory of spending our way to prosperity.  I expect most non-liberal arts degree carrying economists would agree that Steve, once again, out did himself to put economic analysis through a meat grinder and serve it up as a David Burke’s Primehouse 40-day-bone-in ribeye.  I’m going to prove that such a theory is simply impossible, and show how it has become that basis of American economics.  This is going to get a bit heavy so grab a coffee.

Steve says consumer debt is the bridge between working hard and playing hard.  America was built on consumer debt he argues.  He claims that debt levels are very low in America which he claims is a sign of a bad economy.  Now he also seems to have a hint of understanding that too much debt can cause bubbles and he uses student loans as an example, yet he says that a bit trepidatiously despite the fact that we’re still trying to crawl out of one of the worst credit induced recessions in history.   However, despite his caution with student debt he claims the over leverage from the mid 2000′s “has been unwound” and that we are now at the “bottom of the credit cycle”.  And that is why, he claims, the American economy needs more consumer debt.

Ok so lot’s of interesting claims there by Mr. Liesman.  What I’d like to do here is have a very deep look into the American economic psyche and de-engineer some understanding about GDP, the economy and the American standard of living.  To some extent I think we’ll find that Liesman is not all wrong.  However, his call for more consumer debt might actually be the worst piece of economic analysis I’ve ever witnessed on national television.    But Liesman is just a symptom to the larger problem in our distorted understanding of economics here in America.  In any case let’s dig into the matter.

Why don’t we start by having a quick long term look at American consumer debt levels.

Screen Shot 2014-12-19 at 4.09.33 PM

Screen Shot 2014-12-19 at 3.59.31 PM

And well it becomes…
continue reading





 
 
 

Zero Hedge

The Austrian Case Against Economic Intervention

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Patrick Barron via Mises Canada,

The basic unit of all economic activity is the un-coerced, free exchange of one economic good for another based upon the ordinally ranked subjective preferences of each party to the exchange. To achieve maximum satisfaction from the exchange each party must have full ownership and control of the good that he wishes to exchange and may dispose of his property without interference from a third party, such as government. The exchange will take place when each party values the good to be received higher than the good that he gives up. The expected, but by no m...



more from Tyler

Sabrient

Sector Detector: Fed's patience puts bulls in a hurry

Courtesy of Sabrient Systems and Gradient Analytics

U.S. stocks found support once again last week and rallied on strong volume. Of course, the main catalyst was the FOMC policy statement on Wednesday that maintained its dovish language with a pledge of considerable time before raising the fed funds rate and adding that it would be patient as it begins the process of normalizing monetary policy. The result was yet another classic V-bottom. Ho, ho, ho. Say hello to Santa Claus.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast rankings of the ten U.S. business sectors, and then offer up some actionable trading ideas, including a sector rotation strategy using ETFs and an enhanced version using top-ranked stocks from the top-rank...



more from Sabrient

Phil's Favorites

Chinese Banks Hemorrhaging Deposits, 1st Quarterly Drop Since 1999; Banks Offer iPhones, Even Cars for Large Deposits

Courtesy of Mish.

Chinese banks have experienced an outflow of deposits for the quarter for first time since 1999. Customers are attracted to trust funds and the stock market which has been on a tear, up 43% in the last six months.

In the first week of December, Chinese investors opened almost 600,000 stock-trading accounts, a 62 percent increase over the previous week, according to China Securities Depository and Clearing Co.

To compete for funds, Chinese banks offer anything from fresh vegetables for small deposits to a Mercedes A180 for deposits big enough and long enough. The effective yield on the Mercedes is approximately seven percent!

China Daily explains the setup in Lenders Look to Attract Deposits with Goodies.
Lenders in China, de...



more from Ilene

All About Trends

Mid-Day Update

Reminder: David 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...

more from David

OpTrader

Swing trading portfolio - week of December 22nd, 2014

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 ...



more from OpTrader

Chart School

Have a Great Christmas and New Year! Small Caps - It's Over To You....

Courtesy of Declan.

I will be keeping posts to a minimum until the New Year. Friday finished with a bit of a high volume flourish, which added a nice gloss to Thursday's big gains.

The Russell 2000 managed to go one step further with a breakout. Watch this index over the coming days; if it can hold the move it will bring other indices with it. The Russell 2000 has under-performed (relatively) all year, and if bulls are to maintain a broader market rally into a sixth year then the Russell 2000 will have to do most of the leg work. As an important side note, the Russell 2000 turned net bullish technically. The flip-side is to watch for a 'bull trap', but even here, this might instead widen the recent trading range handle as major resistance lives at 1,210/15 not at 1,190.

...

more from Chart School

Pharmboy

2015 - Biotech Fever

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

PSW Members - well, what a year for biotechs!   The Biotech Index (IBB) is up a whopping 40%, beating the S&P hands down!  The healthcare sector has had a number of high flying IPOs, and beat the Tech Sector in total nubmer of IPOs in the past 12 months.  What could go wrong?

Phil has given his Secret Santa Inflation Hedges for 2015, and since I have been trying to keep my head above water between work, PSW, and baseball with my boys...it is time that something is put together for PSW on biotechs in 2015.

Cancer and fibrosis remain two of the hottest areas for VC backed biotechs to invest their monies.  A number of companies have gone IPO which have drugs/technologies that fight cancer, includin...



more from Pharmboy

Digital Currencies

Chart o' the Day: Don't "Invest" in Stupid Sh*t

Joshua commented on the QZ article I posted a couple days ago and perfectly summarized the take-home message into an Investing Lesson. 

Chart o’ the Day: Don’t “Invest” in Stupid Sh*t

Courtesy of 

The chart above comes from Matt Phillips at Quartz and is a good reminder of why you shouldn’t invest in s...



more from Bitcoin

Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly.

Click here and sign in with your user name and password. 

 

...

more from SWW

Option Review

SPX Call Spread Eyes Fresh Record Highs By Year End

Stocks got off to a rocky start on the first trading day in December, with the S&P 500 Index slipping just below 2050 on Monday. Based on one large bullish SPX options trade executed on Wednesday, however, such price action is not likely to break the trend of strong gains observed in the benchmark index since mid-October. It looks like one options market participant purchased 25,000 of the 31Dec’14 2105/2115 call spreads at a net premium of $2.70 each. The trade cost $6.75mm to put on, and represents the maximum potential loss on the position should the 2105 calls expire worthless at the end of December. The call spread could reap profits of as much as $7.30 per spread, or $18.25mm, in the event that the SPX ends the year above 2115. The index would need to rally 2.0% over the current level...



more from Caitlin

Market Shadows

Official Moves in the Market Shadows' Virtual Portfolio

By Ilene 

I officially bought 250 shares of EZCH at $18.76 and sold 300 shares of IGT at $17.09 in Market Shadows' Virtual Portfolio yesterday (Fri. 11-21).

Click here for Thursday's post where I was thinking about buying EZCH. After further reading, I decided to add it to the virtual portfolio and to sell IGT and several other stocks, which we'll be saying goodbye to next week.

Notes

1. th...



more from Paul

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!




FeedTheBull - Top Stock market and Finance Sites



About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

Learn more About Phil >>


As Seen On:




About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>