by ilene - April 23rd, 2015 11:08 am
Facebook Is Hiring Like Crazy (Bloomberg)
Mark Zuckerberg is going to need to find some more pinball machines and rock-climbing walls. The social networking company, known for its many perks that make it a regular on the hottest-places-to-work lists, is increasing headcount at an incredible pace.
China Still Has Plenty of Savings to Unleash (Bloomberg)
The People’s Bank of China lowered banks’ required reserve ratios on Monday, making the largest cut since Nov. 2008. Even so, they still have about 23 trillion yuan ($3.7 trillion) to lock away, begging the question: how much will be allowed to flow into the nation’s slowing economy and boost lending?
Garrett Camp made a fortune helping people navigate the digital world, then a far larger fortune helping them navigate the physical one. The Canadian-born Camp co-founded StumbleUpon, the early online links hub, in 2002, sold it to eBay for $75 million in 2007, and bought it back for 40 percent less in 2009. That same year, it occurred to him that many taxi drivers tooling around in search of their next fares had smartphones in their pockets and could be easily summoned by an app that made use of GPS data. The idea became Uber, and co-founder Camp is now worth an estimated $5.3 billion. As Uber’s chairman, he doesn’t have an operational role at the company, so he had enough time last year to found the tech industry incubator Expa, spread lavishly across the 27th floor of a downtown San Francisco office tower.
Vladimir Putin is determined to make sure that Russians don’t run out of affordable bread, even if it means a few bankrupt farmers and a disrupted grain market.
The country that last year was the fourth-largest wheat exporter is now taxing all overseas sales of the grain. Shipments dropped by more than half, and the loss of income is squeezing already thin profits for growers. While Putin’s move kept more wheat at home, farmers have cut back spending to stay solvent, including using
by ilene - April 22nd, 2015 8:07 pm
The trade that George Soros and Stanley Druckenmiller pulled off in 1992 by betting against the British pound — and making $1 billion in the process — has gained legendary status. (More)
Sales of previously owned homes jumped in March by the most in four years, putting the U.S. residential real estate market on firm footing heading into the busiest time of year.
Purchases increased 6.1 percent to a 5.19 million annualized rate, the highest level since September 2013, figures from the National Association of Realtors showed Wednesday in Washington. Houses were snapped up in 52 days on average, the fastest since July, and property values appreciated. (Continue)
The European Central Bank almost doubled an increase in emergency funding to Greek banks from last week before political talks shift to Brussels and Latvia over the country’s bailout review.
The European Central Bank’s Governing Council raised the cap on Emergency Liquidity Assistance by about 1.5 billion euros ($1.6 billion) to 75.5 billion euros on Wednesday, people familiar with the decision said. ELA is funding provided by national central banks at their own risk and is extended against lower-quality collateral than the ECB accepts. (More)
If you want a consistent stream of income when you retire, you’ve probably heard about a few familiar investment strategies. A dividend-paying stock gets you a regular cash payout from a company while letting you participate in the stock market’s upside. Municipal bonds are safely backed by governments, and their income usually isn’t taxable. (Read more)
Google Inc. is taking a plunge into the $189 billion market for wireless service, creating fresh competition for Verizon and AT&T and stepping up efforts to boost sales and lure users to its Android mobile-phone software. (
by ilene - April 21st, 2015 5:07 pm
By John Mauldin
I can sense a growing unease as I talk with investors and other friends, from professional market watchers and traders to casual observers. What in the Wide World of Sports is going on? It is not just that markets are behaving in an unusual and volatile manner (see chart below showing multiple double-digit moves in the last few months); it’s that the data seems to be so conflicting. One day we get data that shows the economies of the developed world to be slowing, and the next day we get positive numbers. The ship of the economy seems to be drifting rudderless.
My dad used to say about a situation that just didn’t seem quite right that things were “about a half a bubble off dead center.” (This was back in the days when we used bubble levels to determine whether something was level or plumb – before today’s fancy digital gadgets.)
There is a reason, I think, that everything seems just a little out of kilter. I believe that central banks, in their valiant, unceasing efforts to restore liquidity and growth, have unleashed numerous unintended consequences that are beginning to show up in earnest. Today we are going to review the well-meaning behavior of central banks for clues about our near future.
But first, let me take one final opportunity to invite you to come to the 2015 Strategic Investment Conference. We’ve assembled an amazing cast of speakers who will delve deeply into what is really driving the world’s economy. I have some of the finest experts on China from around the world, central bankers, some very powerful analysts whose work commands the attention of the biggest institutions and hedge funds in the world (and whose work costs 20 times or more the price of my conference). Market analysts, geopolitical wizards, and futurists will be on hand, too. This is really the finest gathering of minds I have been pleased to assemble for a Strategic Investment Conference. Click on the link above and peruse the lineup and schedule. The conference starts in a little over a week, on the evening of April 29, and lasts through…
by ilene - April 11th, 2015 1:59 pm
Interesting weekend reading via Zero Hedge. You've probably heard of the Bank of International Settlements, but did you know the members run the world?
Over the centuries there have been many stories, some based on loose facts, others based on hearsay, conjecture, speculation and outright lies, about groups of people who "control the world." Some of these are partially accurate, others are wildly hyperbolic, but when it comes to the historic record, nothing comes closer to the stereotypical, secretive group determining the fate of over 7 billion people, than the Bank of International Settlements, which hides in such plain sight, that few have ever paid much attention.
This is their story.
First unofficial meeting of the BIS Board of Directors in Basel, April 1930
* * *
The following is an excerpt from TOWER OF BASEL: The Shadowy History of the Secret Bank that Runs the World by Adam LeBor. Reprinted with permission from PublicAffairs.
The world’s most exclusive club has eighteen members. They gather every other month on a Sunday evening at 7 p.m. in conference room E in a circular tower block whose tinted windows overlook the central Basel railway station. Their discussion lasts for one hour, perhaps an hour and a half. Some of those present bring a colleague with them, but the aides rarely speak during this most confidential of conclaves. The meeting closes, the aides leave, and those remaining retire for dinner in the dining room on the eighteenth floor, rightly confident that the food and the wine will be superb. The meal, which continues until 11 p.m. or midnight, is where the real work is done. The protocol and hospitality, honed for more than eight decades, are faultless. Anything said at the dining table, it is understood, is not to be repeated elsewhere.
Few, if any, of those enjoying their haute cuisine and grand cru wines— some of the best Switzerland can offer—would be recognized by passers-by, but they include a good number of the most powerful people in the world. These men—they are almost all men—are central bankers. They have come…
by ilene - April 6th, 2015 2:25 pm
We live in a time of unprecedented financial repression. As I have continued writing about this, I have become increasingly angry about the fact that central banks almost everywhere have decided to address the economic woes of the world by driving down the returns on the savings of those who can least afford it – retirees and pensioners.
This week’s Outside the Box, from my good friend Chris Whalen of Kroll Bond Rating Agency, goes farther and outlines how a low-interest-rate and massive QE environment is also destructive of other parts of the economy. Counterintuitively, the policies pursued by central banks are actually driving the deflationary environment rather than fighting it.
This is a short but very powerful Outside the Box. And to further Chris’s point I want to share with you a graph that he sent me, from a later essay he wrote. It shows that the cost of funds for US banks has dropped over $100 billion since the financial crisis, but their net interest income is almost exactly the same. What changed? Banks are now paying you and me and businesses $100 billion less. The Fed’s interest-rate policy has meant a great deal less income for US savers.
[My bold emphasis. ~ Ilene]
It is of the highest irony that Keynesians wanted to launch a QE policy that would increase the value of financial assets (like stocks), which they claimed would produce a wealth effect. I made fun of this policy some five years ago by calling it “trickle-down monetary policy.” Subsequent research has verified that there is no wealth effect from QE. Well, it did make our stocks go up, on the backs of savers. We’ve transferred interest income from savers into the stock market. We’ve made retirement far riskier for our older pensioners than it should be.
As Chris writes:
Indeed, in the present interest rate environment, to paraphrase John Dizard of the Financial Times, it has become mathematically impossible for fiduciaries [brokers, investment advisors and managers of pension funds and annuities]
by Promotions - March 28th, 2015 7:45 am
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 the year with a brand new trade idea)
by Promotions - March 25th, 2015 5:34 pm
The replay will be available on their website after the showing tonight. I'll also post up a link to the replay as soon as it's available!
by ilene - March 7th, 2015 6:58 am
Watch: A 92/Y "7 Days of Genius" video program featuring Nobel laureates Paul Krugman and Joseph Stiglitz and French economist Thomas Piketty who discuss the "genius of economics" with MSNBC's moderator Alex Wagner.
Paul Krugman: “It seems safe to say that Capital in the Twenty-First Century, the magnum opus of the French economist Thomas Piketty, will be the most important economics book of the year—and maybe of the decade. Piketty, arguably the world’s leading expert on income and wealth inequality, does more than document the growing concentration of income in the hands of a small economic elite. He also makes a powerful case that we’re on the way back to ‘patrimonial capitalism,’ in which the commanding heights of the economy are dominated not just by wealth, but also by inherited wealth, in which birth matters more than effort and talent.”
by ilene - March 5th, 2015 10:26 pm
If you missed this earlier, be sure to watch Scott Galloway's presentation on the large global technology companies and the challenges facing them. Galloway discusses Amazon ("pure play commerce doesn't work"), its disruption by Uber, and Macy's, Facebook's bait-and-switch, Instragam ("the most powerful platform in the world"), the smartphone economy (outstanding for employment, terrible for wages), attracting better mates with an iPhone, Apple's successful move down the torso into luxury, and more.
Galloway speaks fast so you may want to watch it twice.
Courtesy of Joshua M Brown
Professor Scott Galloway (NYU) delivers one of the most masterful 15 minutes worth of important tech trends I’ve ever seen. He’s got strong opinions about what’s to become of Amazon, Facebook, Google and Apple – and the charts to back these opinions up.
An amuse bouche: “Google Glass is not a wearable, it’s a prophylactic ensuring you will not concieve a child because no one will get near you.”
Thanks to my friend Ken S. for passing this on. Watch it or miss out on what’s really happening:
Back to me: Watch also Winners/Losers in a Digital Age. In Winners/Losers, Galloway discusses general trends in the digital age, winners and losers in retail, social media and the broader society. He explores wealth inequality and the 0.01% (an "upward spiral downward"), the US tax code, education costs, the middle class, job shifts, the "ipad effect," the myth of progress, and a number of large tech and retail companies including AMZN (the "Tony Soprano of ecommerce"), TWTR, EL, TGT, and ("the first trillion dollar company") AAPL's brilliant move into the business of luxury. Apple is, without a doubt, winning the war. ~ Ilene
by ilene - February 27th, 2015 6:46 pm
By John Mauldin
There is an obsession in the marketplace over the date when the Fed will once again begin to raise rates. As if another 25 basis points is going to change the economics on tens of trillions of dollars of investments. But as we reflect on the issue more deeply, it becomes obvious that a minor bump in the fed funds rate will indeed change a great deal of economics all over the world.
No, it won’t do much to the cap rate on your latest real estate purchase, but it is likely to greatly affect the pricing of the currency and commodity markets. And those markets will affect corporate profits, which will affect the stock market. It’s all connected.
And what if the Fed has lost control? What if they are in a no-win situation where raising rates will cause reactions they don’t want, but not raising rates will result in equally unpleasant reactions?
A big part of the problem lies in what we analysts call divergent and convergent monetary policies. With Japan mounting an unprecedented quantitative easing attack on currencies everywhere and Europe getting ready to join in, with smaller nations all over the world lowering their interest rates, if the US were to raise rates, that move would strengthen the dollar even more. But that would mean even more deflation imported into the US.
Today we find that the headline CPI was -0.7% for January, coming on the heels of two previous months at -0.3%. The year-over-year rate slipped into negative numbers for the first time since October 2009, when we were still reeling from a deep recession.
The Fed typically raises rates when it wants to lean into inflation, not when inflation is falling. Yes, I know that Yellen in her testimony and in recent Fed releases has said the Fed is confident that inflation will once again rise to 2%. And that, even if you take out food and energy, inflation has still risen at 1.6% over the last 12 months.