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Santelli Stunned As Janet Yellen Admits “Cash Is Not A Store Of Value”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Intended warning or unintended slip? After Alan Greenspan’s confessional admission that

Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it,”

we found it remarkable that during the Q&A after her speech today that Janet Yellen, when asked about negative rates, admitted that

“cash in not a very convenient store of value,”

seemingly hinting at Bernanke’s helicopter and that there will be no deflation in The US ever…  

Rick Santelli then sums it all up perfectly…  

“deflation is clearly the boogeyman… and the only thing that will save the middle class.”

*  *  *

Yellen: “cash is not a convenient store of value”

* * *

So if cash is not a very convenient store of value… what is? Biotechs? As Rick Santelli explains… this is the scariest thing she has ever said…

Santelli: “deflation is the boogeyman… and the only thing that can save the middle class is lower prices”





Obama Administration Bullies Allies Over Iran Nuke Deal Dissent

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

President Obama is "blowing up our alliances to secure a deal that paves Iran’s way to a bomb," according to European sources close to the negotiations, and as Washington Free Beacon reports, efforts by the Obama administration to stem criticism of its diplomacy with Iran have included threats to nations involved in the talks, including U.S. allies. France has borne the brunt of Obama's wrath as one source in Europe close to the ongoing diplomacy said the US has begun to adopt a “harsh” stance toward its allies in Paris because "the clarifications expose just how weak the Americans’ deal is shaping up to be."

As The Washington Free Beacon reports,

A series of conversations between top American and French officials, including between President Obama and French President Francois Hollande, have seen Americans engage in behavior described as bullying by sources who spoke to the Washington Free Beacon.

The disagreement over France’s cautious position in regard to Iran threatens to erode U.S. relations with Paris, sources said.

Tension between Washington and Paris comes amid frustration by other U.S. allies, such as Saudi Arabia and Israel. The White House responded to this criticism by engaging in public campaigns analysts worry will endanger American interests.

Western policy analysts who spoke to the Free Beacon, including some with close ties to the French political establishment, were dismayed over what they saw as the White House’s willingness to sacrifice its relationship with Paris as talks with Iran reach their final stages.

A recent phone call between Obama and Hollande was reported as tense as the leaders disagreed over the White House’s accommodation of Iranian red lines.

“The French want a deal, but they see no rush and repeat that Iranians need a deal more than we do, and that we shouldn’t fix artificial deadlines that put more pressure on us than Iran.”

One source in Europe close to the ongoing diplomacy said the United States has begun to adopt a “harsh” stance toward its allies in Paris.

“There have been very harsh expressions of displeasure by the Americans toward French officials for raising substantive concerns about key elements of what the White House and State Department negotiators are willing to concede to Iran,” said the source, who spoke on condition of anonymity. “That is because the


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Crude Carnage & Hawkish Yellen Leave Dow In The Red For 2015

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

After all the exuberance last week following Janet Yellen's utter confusion, stocks suffered their worst week in months… even with th epanic buying on INTC news and in anticpation of Yellen…

Very quiet last two days… with some excitmenmt from Intel and Yellen at the close…

But futures show the reality of the volatility…

As The S&P 500 was pinned at unchanged YTD (Dow red in 2015)

Energy stocks outperformed (though closed red on the week) but Financials were the worst sector this week, down over 3% – the worst week for financials in 11 months

Biotechs dropped over 6% on the week (with highest volume ever) - the biggest drop since early Oct 2014 (but the swing from last week's highs to this week's lows of over 15% was the biggest in 11 months)

Trannies were worst this week, and suffered their biggest weekly drop in almost 6 months – Trannies are now down since the end of QE3

All down post-FOMC…

This was on course to be the best week for crude since July 2013 until prices collapsed in the last hour or so… ending up 4% – still the best since early Feb.

After 5 straight weeks up… AAPL is down 4 of last 5 weeks

Intel did its best to drag The Dow into the green YTD…

Treasury yields ended the week very modestly higher, rallying all day today…not 5 days in a row of USD selling during EU day session

The US Dollar ended the week lower by around 0.4% led by EUR and Swissy strength…

but Silver and The Russian Ruble remain the best performers against the USD year-to-date…

Copper lost ground as China growth fears spread but PMs rose on weaker dollar and war fears… oil did its crazy thing…

Charts: Bloomberg





FeaTHeReD VaRMiNT…

Courtesy of ZeroHedge. View original post here.

Submitted by williambanzai7.





Janet Yellen To Discuss “The New Normal For Monetary Policy”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

In a few minutes, Janet Yellen will address a lunch session in her native SF Fed (the same place which earlier this week finally figured out what debt is) during a conference whose topic is The New Normal for Monetary Policy (the typo from “Paranormal” is easy to make).

The full formal agenda is shown below.

The informal agenda will be Yellen’s explanation of how she plans on achieving the yield curve which we predicted back in 2010 is just a matter of time.

And while it is unlikely Yellen will say much if anything actionable, the speech taking place 15 minutes before market close on a Friday has many wondering: why now, and how will the algos react to the headlines from her speech, if not so much in the Emini where lately it has been all Citadel and the Bank of Japan, then more in the EURUSD and USDJPY.

We will post the full speech once it is released in a few minutes.

And here are the headlines:

  • YELLEN: TIGHTENING PACE COULD SPEED UP, SLOW, PAUSE OR REVERSE
  • YELLEN: GRADUAL RISE IN RATES APPROPRIATE OVER NEXT FEW YEARS
  • YELLEN SAYS RATE RISE MAY WELL BE WARRANTED LATER THIS YEAR
  • YELLEN: STRONGER DOLLAR HURTING EXPORTS; HOUSING STILL SUBDUED
  • YELLEN SAYS LABOR MARKET RECOVERY HAS BEEN SUBSTANTIAL
  • YELLEN SAYS CAN’T WAIT UNTIL INFLATION BACK TO 2% BEFORE MOVING

But the punchlines, and why a rate hike appears a done deal at least in the eyes of the Fed:

I would first note that the current stance of monetary policy is clearly providing considerable economic stimulus. The near-zero setting for the federal funds rate has facilitated a sizable reduction in labor market slack over the past two years and appears to be consistent with further substantial gains. A modest increase in the federal funds rate would be highly unlikely to halt this progress, although such an increase might slow its pace somewhat.

Second, we need to keep in mind the well-established fact that the full effects of monetary policy are felt only after long lags. This means that policymakers cannot wait until they have achieved their objectives to begin adjusting policy. I would not consider it prudent to postpone the onset of normalization until we have


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Saudi Arabia Then & Now (In 1 Cartoon)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

“Unintended Consequences”?

Source: Townhall





Central Banks Are Paralyzed At The Zero Bound

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Alasdair Macleod via GoldMoney.com,

Though the Fed would deny it, it is clear from the minutes of the last Federal Open Market Committee (FOMC) meeting that a rise in interest rates has been put off indefinitely.

The subsequent rally in the price of gold and the sudden fall in the dollar tend to confirm this conclusion.

The Fed Funds Rate, which is the interest rate the Fed targets to set all other rates, has now been less than 0.25% for six and a quarter years, gradually declining from roughly 0.15% to about 0.10% today. It was set at a target range of between zero and 0.25% in December 2008.

Effective Fed Funds Rate

According to the Policy Normalisation Principles and Plans issued last September, the FOMC will raise its target range for the Fed Funds Rate "primarily by adjusting the interest rate it pays on excess reserve balances" when the Fed normalises interest rates, "using reverse repurchase agreements to take money out of circulation to the degree necessary". The Fed also intends to reduce its holdings of securities and contract its balance sheet in the longer run.

If normalisation is the result of economic recovery we will be familiar with the playbook. Demand for money in the economy picks up, and instead of pyramiding bank credit on reserves held at the Fed, the Fed feeds back the excess reserves to the banks by selling government securities into the markets. The bear market in government bonds should be manageable because of underlying pension and insurance company demand coupled with a diminishing budget deficit. This is the long-understood theory behind withdrawing from deficit financing.

The reality has been very different as we all know. The Fed has to face the possibility that, for whatever reason, highly suppressed interest rates are not working, and an escape from the zero interest rate bound without economic recovery may have to be contemplated.

However, if the Fed raises the Fed Funds Rate in the absence of genuine economic recovery, there will be little or no expansion of bank credit to offset, and commercial banks will want to dump their Treasuries, not buy more from the Fed. There would be no offsets to cushion the unwinding of long bond positions. In other words the effect of even…
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Housing Contribution To US GDP Lowest In Post-War Era

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

In “Underwater Homeowners Here To Stay” we highlighted a report from Zillow which showed that negative equity has now become a permanent fixture of the US housing market. The report also showed that the percentage of homeowners who are underwater was flat from Q314 to Q414, breaking a string of 10 consecutive quarters of declines. We also recently noted that a completely ridiculous new home sales print that defied all logic notwithstanding, housing data, including starts and existing home sales, has come in below expectations. On a side note, home price appreciation has outpaced wage growth at a rate of 13:1, to which we would add: 

Of course, the biggest determinant of home price appreciation over the past 2 years has nothing to do with US consumers, or household formation, as confirmed by the collapse in first-time homebuyers or the unprecedented depression in new mortgage origination, and everything to do with what we first suggested is one of the main drivers of the US housing bubble – foreigners parking their illegally procured cash in the US and evading taxes, now that US housing, with the NAR’s anti-money laundering exemption blessing, is the new normal’s Swiss Bank Account. That and flipping homes from one “all-cash” buyer to another “all-cash” buyer in hopes of a quick capital appreciation and the constant presence of the proverbial dumb money.

Against this backdrop, Deutsche Bank is out predicting that a sluggish US housing market is likely to impact the supply of MBS going forward. As DB notes, housing isn’t the GDP contributor it once was and not by a long shot. Not only that, but when it comes to recoveries, the housing market’s GDP contribution was 7 times below its post WW2 average in year one and has fared even worse since. Here’s DB with more:

The contribution of housing to US GDP continues to run at some of the lowest levels since the end of World War II. New construction of single- and multi-family homes, renovations, broker fees and the like still only make up a bit more than 3% of current GDP, well below the post-war average of 4.7%. Not only has the level of lift from housing come in low, but it has bounced out of the last official recession slowly, too. Housing


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Police Gas Student Protesters In Quebec

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Earlier this week we reported that the Blockupy movement — supporters of which set fire to the streets of Frankfurt earlier this month in an anti-austerity protest timed to coincide with the grand opening of the ECB’s new headquarters — had apparently spread across the Atlantic to the streets of Montreal where students describing themselves as “an association of young communists and anti-capitalists” got tear gassed, sound bombed, and shot with rubber bullets after they failed to provide police with an itinerary as to what they planned to vandalize and when. 

Just days later and aggrieved Canadian students are at it again, this time in Quebec City where hundreds gathered to protest austerity measures like shorter library hours. Here’s more from RT News

Students in Quebec City were sprayed with tear gas by Canadian police after holding an ‘illegal’ gathering to protest the provincial budget. A brief scuffle broke out before law enforcement officers began randomly gassing the demonstrators.

Hundreds of students, some traveling from as far as Montreal, had gathered in front of the National Assembly to protest the Quebec government’s budget, which had been table on Thursday.

The demonstrators wanted to hold a protest in front of the National Assembly to show their disgust at cuts to services such as healthcare on campus and library hours. They were met by a line of riot police in full body armor.

According to reports, this group made the same mistake as the last group by not providing police with an itinerary thus rendering the whole endeavor illegal from the get go and so in the end, the outcome was largely the same: some folks got gassed..





Yemen “Gulf Intervention” Premium Erased, WTI Tumbles Back Below $49

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Well that was a quick geopolitical event. On the heels of what was set to be Crude’s best week since July 2013, Stratfor clarifying little risk of disruption to crude supplies, Goldman confirming neglible impact from Yemen and more to Iran, and reports from Saudi Arabia that “this [Yemen] operation will not go on for long, I think it will be days,” WTI crude has tumbled back to the $48 handle and erased all the “gulf intervention” premium – refocusing on domestic storage concerns.

As Reuters reports,

The Arab military campaign against Yemen’s Houthi militia is likely to last days rather than weeks, Yemeni Foreign Minister Riyadh Yaseen told Saudi-owned al-Arabiya television on Friday.

In answer to a question about whether he thought the Saudi-led operation, which began on Thursday, would last days or weeks or more, Yaseen replied: “I expect that this operation will not go on for long, I think it will be days.”

*  *  *





 
 
 

Zero Hedge

Proof Positive That the "Recovery" is a Lie and the Fed Is Only Interested in the TBTFs

Courtesy of ZeroHedge. View original post here.

Submitted by Phoenix Capital Research.

By basing the whole “recovery” argument on fraudulent data, the Fed and Federal Government have backed themselves into a corner.

After all, anyone with a functioning brain knows that the unemployment data, and, GDP growth data are massaged at best and totally bogus at worst. By using these data points as bricks to build the argument that somehow spending $4 trillion in newly printed money (and issuing $11 trillion in new debt) was needed only reinforces one of two things:

1)   None of the people in charge of steering the economy have a clue what they’re doing …

 

Or...



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Promotions

Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene

 

The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Phil's Favorites

Patriot Act Vote Coming Up: Google joins Apple, Others Requesting Spying Controls

Courtesy of Mish.

The Patriot act expires in June, and anyone in their right mind would wish the entire concept to go away entirely. NSA Spying has a 100% perfect track record of failure.

Sadly, the answer to the question Would NSA Data Surveillance End With Patriot Act? is a resounding "No".
The National Security Agency would lose its legal justification for collecting data on Americans' phone and email activity if Congress does not reauthorize the Patriot Act by June 1, but privacy advocates are skeptical about whether that would mean the end of the controversial surveillance program.

President Barack Obama has called on Congress to pass a bill that would end the bulk surveillance program while keeping certain spying powers intact for national...



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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...

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Insider Scoop

Raymond James Downgrades Power Integrations To Market Perform

Courtesy of Benzinga.

Related POWI Benzinga's Top Downgrades Benzinga's Volume Movers

Analysts at Raymond James downgraded Power Integrations Inc. (NASDAQ: POWI) from Outperform to Market Perform and removed the price target of $57.00.

Power Integrations shares have dropped 18.42% over the past 52 weeks, while the S&P 500 index has surged 10.69% in the same period.

Power Integrations' shares fell 1.51% to $51.65 in pre-market trading.

Latest Ratings for POWI DateFirmActionFrom...

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Chart School

S&P 500 Snapshot: Selloff Ends with a Modest Gain

Courtesy of Doug Short.

Friday was a mixed bag of economic data. Hopes for an upward revision to Third Estimate of Q4 GDP were disappointed when the BEA left the annualized rate at 2.2%. The final Michigan Consumer Sentiment for March was an improvement on the preliminary reading, but it was below the February final and well off the January 11-year high. The S&P 500 spent the day in a narrow range, ending with a modest 0.24% gain, which snapped a four-day selloff. The index was down 2.33% for the week, its second worst weekly performance of 2015 (the worst being the -2.77% plunge in late January).

The yield on the 10-year Note fell 7 bps to 1.95%.

Here ...



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Sabrient

Sector Detector: Bulls retake the wheel, with a little help from their friends at the Fed

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

Courtesy of Scott Martindale at Sabrient Systems

Well, it didn’t take long for the bulls to jump on their buying opportunity, with a little help from the bulls’ friend in the Fed. In fact, despite huge daily swings in the market averages driven by daily news regarding timing of interest rate hikes, the strength in the dollar, and oil prices, trading actually has been quite rational, honoring technical formations and support levels and dutifully selling overbought conditions and buying when oversold. Yes, the tried and true investing clichés continue to work -- “Don’t fight the Fed,” and “The trend is your friend.”

In this weekly update, I give my view of the cur...



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OpTrader

Swing trading portfolio - week of March, 23rd, 2015

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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Digital Currencies

Bitcoin vs. Uber: Bitcoin Lovers Respond to Mish

Courtesy of Mish.

I recently commented that it would not surprise me if bitcoin plunged to $1.00. That was not a prediction, it was a comment.

Still, I still feel a collapse in bitcoin is likely.

For discussion, please see Cash Dinosaur: France Limits Cash Transactions to €1,000, Puts Restrictions on Gold; Bitcoin End Coming?

In response, reader Creighton writes ...

Hello Mish

While I'm not going to argue the point about the possibility that Bitcoin drops to $1, or less, (that could happen yet, but not for the reasons you propose) I felt it necessary to point out something you seem to have overlooked.

While it's likely that the US government watching Bitco...



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Market Shadows

Kimble Charts: South Korea's EWY

Kimble Charts: South Korea's EWY

By Ilene 

Chris Kimble likes the iShares MSCI South Korea Capped (EWY), but only if it breaks out of a pennant pattern. This South Korean equities ETF has underperformed the S&P 500 by 60% since 2011.

You're probably familiar with its largest holding, Samsung Electronics Co Ltd, and at least several other represented companies such as Hyundai Motor Co and Kia Motors Corp.

...



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Option Review

Cypress Semi Draws Bullish Option Plays

Bullish trades abound in Cypress Semiconductor options today, most notably a massive bull call spread initiated in the July expiry contracts. One strategist appears to have purchased 30,000 of the Jul 16.0 strike calls at a premium of $0.89 each and sold the same number of Jul 19.0 strike calls at a premium of $0.22 apiece. Net premium paid to put on the spread amounts to $0.67 per contract, thus establishing a breakeven share price of $16.67 on the trade. Cypress shares reached a 52-week high of $16.25 back on Friday, March 13th, and would need to rally 4.6% over the current level to exceed the breakeven point of $16.25. The spread generates maximum potential profits of $2.33 per contract in the event that CY shares surge more than 20% in the next four months to reach $19.00 by July expiration. Shar...



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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...



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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. 

 

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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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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...

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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.

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