Archive for 2014

What The $1+ Trillion Student Debt Bubble Is Being Spent On

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

By now everyone knows there is an unprecedented student debt bubble, amounting to well over $1 trillion and rising at a rate of nearly $200 billion per year. However, what is far less known, is what all these hundreds of billions in government loan proceeds are being spent on.

The following two charts should shed some light on this matter of just how Government money goes from Point A to Point B, using indebted to the hilt students as a pass-thru.

First, the change in the number of higher education employees since the mid-1970s, broken down by job category. One can almost see why preserving the status quo of the Keynesian religion is the lifetime goal of most professors.

And then, the change in average salaries across the higher education spectrum. It would appear the only thing Krugman would want more than being a tenured op-ed writer, pardon professor, is CEO of a private college.

Source: American Association Of University Professors, Losing Focus: The Annual Report on the Economic Status of the Profession, 2013-14





China Beige Book, HSBC Manufacturing PMI Paint Diametrically Opposing Pictures Of China’s Economy

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

S&P 500 futures are jumping exuberantly as Japan and China PMIs print above expectations and back in expansion territory (Japan best in 3 months, China best in 7 months). This is China's best 2-month PMI rise since Oct 2010 (which makes perfect sense amid the collapsing housing market and CCFD ponzi probe) – which provides the perfect propaganda meme that targeted RRR cuts workl. However, while stocks don;t care to scratch the surface, there are 2 glaring similarities that could become a problem. Both China and Japan saw employment drop (Japan's first in 11 months) and furthermore both China and Japan saw input prices rise and output prices decline – not exactly the margin expansion dream everyone is hoping for… and all this as China's Beige Book shows the slowdown deepening on weak investment.

 

China's Manufacturing PMI saw its best 2 months since Oct 2010… so RRRs work right?

 

Which is odd given that GDP expectations continue to collapse… (h/t @M_McDonough )

 

And China and Japan both see employment drop and margin pressures build…

 

as Japan employment tumbles…

 

But none of that "fact" details matter – you buy stocks…

 

As China's Beige Book was anything but positive…

  • CHINA BEIGE BOOK SAYS SLOWDOWN DEEPENING ON WEAK INVESTMENT
  • CHINA BEIGE BOOK SAYS FEWER COMPANIES ACCESSED CREDIT IN 2Q

China’s economy continues to decelerate quarter-on-quarter, driven by “perhaps unprecedented weakness” in capital expenditure, China Beige Book says in its 2Q survey released today.

* Fewest number of firms increasing investment and most pronounced quarter-on-quarter drop in 10 quarters of surveys
* Fewer companies surveyed accessed credit from banks, shadow lenders and the bond market
* Survey finds loan rates inverted, with bank interest rates ticking up in the quarter while non-bank rates saw a “substantial slide” to below levels offered by banks
* Firms appear to be responding to current economic conditions by borrowing and spending less
* Weakness in investment has “sweeping effects” on sectors, regions and gauges of company performance
* Services weakened more sharply while transportation, mining, and retail slowed
* Manufacturing showed year-on-year growth for the fourth quarter in a row and was stable vs previous quarter
* In property sector, residential and commercial realtors “were pummeled,” while builders reported higher starts…
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LNG: The Long, Strategic Play For Europe

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by James Stafford of OilPrice.com

LNG: The Long, Strategic Play for Europe: Interview with Robert Bensh

Liquefied natural gas (LNG) to Europe isn’t a get-rich-quick scenario for the impatient investor: It’s a long, strategic play for the sophisticated investor who can handle no small amount of politics and geopolitics along the way. When it comes to Europe, Russia’s strategy to divide and conquer has worked so far, but Gazprom is a fragile giant that will eventually feel the pressure of LNG.

Robert Bensh is an LNG and energy security expert who has over 13 years of experience with leading oil and gas companies in Ukraine. He has been involved in various roles in finance, capital markets, mergers and acquisitions and government for the past 25 years. Mr. Bensh is the Managing Director and partner with Pelicourt LLC, a private equity firm focused on energy and natural resources in Ukraine.

In an exclusive interview with Oilprice.com, Bensh tells us:  

•    Why the smart LNG play is a long-term one
•    How LNG fits into the European energy picture
•    Why LNG will eventually pressure Russia in Europe
•    Why Gazprom is but a fragile giant
•    How Russia combines gas and political influence in Eastern Europe
•    How the European Union is easy to divide and conquer
•    Why the Ukraine crisis has brought attention to the South Stream pipeline
•    Why Bulgaria is the new front line
•    How Lithuania succeeded in negotiating down Gazprom
•    What Moscow’s Crimea annexation really achieved
•    Why it’s game over for Gazprom prices when Turkey steps in

James Stafford: Where does LNG fit into the overall European energy picture?

Robert Bensh: A better question might be, “When does LNG fit into the European energy picture?” When the price is right, it fits into the picture across the European Union, with new import terminals under construction, plenty of transmission lines to deliver it to land-locked countries and the prospect of deliveries from rising energy hub Turkey. And while it may not be a reality at this very moment, it is the prospect of cheaper LNG and the pace of LNG infrastructure development that has Gazprom worried about maintaining its monopoly.

James Stafford: So from an investor’s perspective, what do we need to know here?

Robert Bensh: Listen, the LNG economics are marginal. LNG is about long-term,…
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Pension Money Already Flowing In To Prop Up Japan’s Stocks

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

With almost metronomic regularity, Japan will gush forth a headline proclaiming the ever-closer time when all the nation's retirees savings will be greatly rotated to the stock market and away from the nation's largest bond market in the world. This week was no exception; however, as Nikkei Asian Review reports, it appears the "all-talk" has turned to action…The Government Pension Investment Fund and other public pensions sold about 1.8 trillion yen ($17.4 billion) more in Japanese government bonds than they bought in the first three months of the year, fueling speculation that the GPIF may be rebalancing its portfolio sooner than expected. It seems rotating away from government bonds (which the GPIF has been worried about since 2011) into junk bonds and junk stocks is a far better use of 'wealth' – we can only imagine the GPIF risk models just got switch to '11'. As we explained last year, Japan's Plan B is not only not a panacea, but it is a House of Bonds Cards that would not survive an even modest gust of wind, and an even more modest contemplation into its true internal dynamics. We would urge Messrs Abe and Kuroda to come up with a fall back plan to the fall back plan before it, once again, becomes too late.

As Nikkei Asian Review reports,

The Government Pension Investment Fund and other public pensions sold about 1.8 trillion yen ($17.4 billion) more in Japanese government bonds than they bought in the first three months of the year, fueling speculation that the GPIF may be rebalancing its portfolio sooner than expected.

 

The pensions' net selling of JGBs and "zaito" bonds — the latter used to finance the government's fiscal investment and loan program — totaled 1.85 trillion yen, according to flow-of-funds statistics released Wednesday by the Bank of Japan. This marked the third consecutive quarter of net selling and the largest sum since the April-June quarter of 2012.

 

The GPIF is the world's largest pension fund, with roughly 130 trillion yen in invested assets, and is set to revise its portfolio by autumn. As part of its growth strategy, the government has been considering raising the proportion of domestic stocks in the fund to nearly 20% from


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The God-less-father: Pope Excommunicates All Mobsters From Catholic Church

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

After hundreds of years knowing that no matter how many ‘double-taps to the head’ or ‘sleeping with the fishes’ orders they give, a quick penance and the mafia is going to pass through the pearly gates; the Pope, having met the father of a 3-year-old boy slain in the region’s drug war, declared that all mobsters are automatically excommunicated from the Catholic Church. “Those who go down the evil path, as the Mafiosi do, are not in communion with God. They are excommunicated,” Pope Francis decreed during his one-day pilgrimage to the southern region of Calabria – the heart of Italy’s biggest crime syndicate. With the world already having a ChairSatan, is it now time for The SatanFather?

 


As CBS reports,

Pope Francis journeyed Saturday to the heart of Italy’s biggest crime syndicate, met the father of a 3-year-old boy slain in the region’s drug war, and declared that all mobsters are automatically excommunicated from the Catholic Church.

 

During his one-day pilgrimage to the southern region of Calabria, Francis comforted the imprisoned father of Nicola Campolongo in the courtyard of a prison in the town of Castrovillari.

 

In January the boy was shot, along with one of his grandfathers and the grandfather’s girlfriend, in an attack blamed on drug turf wars in the nearby town of Cassano all’Jonio. The attackers torched the car with all three victims inside.

 

Calabria is the power base of the ‘ndrangheta, a global drug trafficking syndicate that enriches itself by extorting businesses and infiltrating public works contracts in underdeveloped Calabria.

 

During his homily at an outdoor Mass, Francis denounced the ‘ndrangheta for what he called its “adoration of evil and contempt for the common good.”

 

“Those who go down the evil path, as the Mafiosi do, are not in communion with God. They are excommunicated,” he warned.

 

As much as the church has been a force against the mafia there have also been instances of priests colluding with them, CBS News correspondent Allen Pizzey reports from Rome. Francis’ visit and rhetoric could also be seen as a message that that won’t happen again.

The big question, of course, is if there is a ‘godthering’ clause that enable the Dons access to the after-life? How long before Francis gets an offer he can’t refuse?





Gauging Investor Sentiment with Twitter: Weekly Update

Courtesy of Doug Short.

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.


The Downside Hedge Twitter sentiment indicator for the S&P 500 Index (SPX) spiked this week when the market first made new highs, but the subsequent days had tepid readings. This is causing a negative divergence in smoothed sentiment that is now three weeks old. This suggests that market participants aren’t enthusiastic about the move above 1950 on SPX. Regardless of the divergence, smoothed sentiment is still above zero and a confirming trend line so the odds favor higher prices even if they’ll be slow in coming.

Support and resistance levels gleaned from the Twitter stream continue the same pattern. Almost no calls for prices above the market and scattered tweets below. 1925 on SPX is the only real support and 2000 is resistance. However, there haven’t been significant tweets for the 2000 level for more than 2 weeks. This suggests that traders are simply watching the action rather than anticipating higher or lower prices.

Sector sentiment has had all positive readings for four weeks in a row. This is a very unusual circumstance and suggests that rotation to safety is ongoing. As I’ve mentioned before when all sectors have positive readings short term tops are near.

Overall sentiment is a bit cautious with smoothed sentiment diverging from price, traders reluctant to target higher prices, and the sectors suggesting market participants are rotating to safety. The silver lining is that smoothed sentiment is still above zero and a confirming trend line. This suggests the market should move higher, but it has some headwinds.


Blair Jensen at Downside Hedge tracks Twitter sentiment and provides hedging strategies for individual investors.





Despite “Giving Americans A Blow Job”, Polish Foreign Minster Says “US Alliance Is Worthless”

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Well this is awkward. A week after the Polish central bank was busted offering favors to the government (exposing its utter un-independence); the same Polish news magazine has obtained s ecret recording of Foreign Minister Radoslaw Sikorski saying that Poland’s relationship with the United States was worthless. The Wprost news magazine said the recording was of a private conversation between Sikorski and Jacek Rostowski (finance minister) with such headlines as “you know that the Polish-US alliance isn’t worth anything;” also describing Warsaw’s attitude towards the United States using the Polish word “murzynskosc” – roughly translated as a negro slave – “It is downright harmful, because it creates a false sense of security … Complete bullshit. We’ll get in conflict with the Germans, Russians and we’ll think that everything is super, because we gave the Americans a blow job. Losers. Complete losers.” USA – making friends wherever they go.

 

As The Guardian reports,

A Polish news magazine said on Sunday it had obtained a secret recording of Foreign Minister Radoslaw Sikorski, in contention for a senior European Union job, saying that Poland’s relationship with the United States was worthless.

 

The Wprost news magazine said the recording was of a private conversation earlier this year between Sikorski and Jacek Rostowski, a member of parliament with the ruling Civic Platform who until last year was finance minister.

 

 

Aides to Sikorski and Rostowski said they had no immediate comment. A government spokeswoman said it was hard to form a view based on a few excerpts of a conversation, but there might be a comment later.

 

According to a transcript of excerpts of the conversation that was published by Wprost on its Internet site, Sikorski told Rostowski: “You know that the Polish-US alliance isn’t worth anything.”

 

“It is downright harmful, because it creates a false sense of security … Complete bullshit. We’ll get in conflict with the Germans, Russians and we’ll think that everything is super, because we gave the Americans a blow job. Losers. Complete losers.”

 

According to the transcript, Sikorski described Warsaw’s attitude towards the United States using the Polish word “murzynskosc.”

 

That derives from the word “murzyn,” which denotes a dark-skinned person and someone who does the work for somebody


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Daily Market Commentary: Watch for Nasdaq Breakout

Courtesy of Declan.

Lots of buying volume on Friday, although only small gains to match. The Nasdaq is best poised to advance on Monday given it lies just shy of resistance. The narrow range day also offers itself as a swing trade opportunity (with a stop on the flip side).  Trend direction suggests this will push higher, becoming a nail in the coffin to what had looked like a (complex) bearish head-and-shoulder reversal.


There is little to add on the S&P. The very narrow range day may again offer itself as a swing trade play, although given how tight the range is there is a strong chance of a whipsaw signal.  I’m still unchanged on the idea the S&P will make it to the 10% envelope (i.e. 10% above its 200-day MA) this summer.

The Russell 2000 inched higher, but hasn’t yet reached resistance defined by the March high. Trend followers can look to follow the minor gains, but it’s not as attractive as the Nasdaq or S&P.

As a final note, the Semiconductor index continued its narrow ascent higher. The next sell off will scare weak hands, but will likely offer itself as a good long term buying opportunity.  This index looks to be building a secular advance which could last many years.

For Monday, eyes should be on the Nasdaq. If the week starts well I would look for Tech averages to outperform as traders jump on the breakout bandwagon.





Analysis of Obama’s Plan to Save the World From Greenhouse Gasses

Courtesy of Mish.

By executive order, president Obama has acted to cut greenhouse gas emissions in the US, allegedly to halt global warming.  However, greenhouse gas production is a global thing so it’s important to consider global ramifications of US policy decisions.

Starting with Europe’s carbon cap-and-trade, let’s take a look at global events and policies to see if Obama’s plan has any chance of success.

Collapse of Carbon Price Trading

Europe’s cap-and-trade effort is in crisis as a Collapse in EU Carbon Price has rendered the program useless.

The EU Emissions Trading Scheme is in crisis. Yesterday, the European Parliament voted against the backloading proposal which was aimed at increasing the price of carbon permits. After the vote, the price of carbon permits dropped by about 40% to its lowest ever price of €2.63. New Energy Finance predicts that it might fall as low as €1.

Mark Whitaker (BBC): Today, European MPs vote no to a plan to boost the idea of carbon trading as the weapon to combat climate change.

Tamra Gilbertson (Carbon Trade Watch): Perhaps this can be a signal to the rest of the world that emissions trading and market-based solutions are not the solution to climate change.

Mark Whitaker: Not everyone is convinced it actually works, but the cornerstone of Europe’s effort to combat climate change is something called carbon trading, which works on the idea that companies are allowed to buy permits to cover any carbon emissions they make. It’s based on the principle that the polluter pays.

The trouble is, the price of carbon permits has dropped so low that there was scarcely any deterrent at all to pumping out carbon.

Today, the European Parliament voted not to intervene in the carbon permit market to prop up the price of the permits. MEPs had been invited to vote for something called backloading, that’s a plan to delay the issue of any more permits in order to boost the price. It was an invitation that they declined.

Australia Plans to Scrap Carbon Tax

Bloomberg reports Australia’s Abbott Revives Proposal to Scrap Carbon-Price Levy

Australia will re-introduce a bill to repeal a carbon-price mechanism brought in by the previous Labor government ahead of a power shift in the Senate, which has previously rejected the levy’s removal.



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Obama’s Middle East Foreign Policy (In 2 Cartoons)

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Swallowed alive with strange bedfellows… yep, that about sums it up.

 

 

 

Source: Sunday Funnies





 
 
 

Phil's Favorites

Brexit identities: how Leave versus Remain replaced Conservative versus Labour affiliations of British voters

 

Brexit identities: how Leave versus Remain replaced Conservative versus Labour affiliations of British voters

Courtesy of Geoffrey Evans, University of Oxford and Florian Schaffner, University of Oxford

British politics was relatively stable in the post-war decades, and voters’ strong party loyalties were influenced by their place in society. More recently, there has been a marked decline in the number of people identifying with a political party, and in the strength of that attachment.

Now, our new research for a repor...



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Zero Hedge

Stocks Jump On Kudlow Denial: "There Is No Cancellation. None. Zero."

Courtesy of ZeroHedge. View original post here.

"There are no cancellations. None. Zero. Let's put that to rest."

Hours after a headline from the FT about the US cancelling a round of trade talks with two senior Chinese ministers send stocks reeling to their lows of the day, the administration has dispatched Larry Kudlow (who apparently had to wait until 20 mins before the close thanks to CNBC's wall-to-wall Davos coverage) to jawbone the markets back into the green by...



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Kimble Charting Solutions

S&P and Crude both testing key breakout levels!

Courtesy of Chris Kimble.

The correlation between Crude Oil and the S&P 500 has been rather high over the last 100-days, as each looks to have peaked at the same time around the 1st of October at (1).

After peaking together in October, Crude fell over 40% and the S&P nearly declined 20%, with both bottoming on Christmas Eve at each (2).

Both have experienced counter-trend rallies since the lows, as Crude is up 23% and the S&P 13%.

These rallies have both testing dual resist...



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Insider Scoop

Cowen Suits Up With Nike, Looks To Outperform

Courtesy of Benzinga.

Related NKE Consumer Discretionary Q4 Earnings: U.S. Consumer Appears Strong Amid Heightened Global Uncertainty Golf Equipmen...

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Chart School

Weekly Market Recap Jan 20, 2019

Courtesy of Blain.

After entering the week quite overbought, indexes took a small retreat Monday before hurling back upwards.  This is typical of the “V” shaped moves up after any significant selloff, we’ve seen most of the past decade and watching them unfurl is quite amazing actually.  Thought maybe this time would be “different” but not so much.  So two week’s ago we asked “Has the Fed solved all the market’s problem in 1 speech?” – and thus far the market has answered resoundingly yes.  The word of the year thus far in 2019 is “patience” as that simple insert into a speech change the whole complexion of everything.

China has also been busy stimulating; on Tuesday:

An announcement from the People’s Bank of China that ...



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ValueWalk

Everyone Else Is Selling Stocks, So Is It Time To Buy?

By Michelle Jones. Originally published at ValueWalk.

After a difficult few trading days in the beginning of the year, U.S. stocks are bouncing back with meaningful gains on Monday following Friday’s strong rally. The S&P 500, Dow Jones Industrial Average and Nasdaq 100 were all up by more than half a percent by midday. It looks like investors could be taking advantage of the end-of-the-year declines, but is this a wise time to be buying?

Trying to time the bottom of the market will almost always be a fool’s errand, but one firm suggests equities could have much farther to fall before they hit bottom in 2019.

...



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Digital Currencies

Transparency and privacy: Empowering people through blockchain

 

Transparency and privacy: Empowering people through blockchain

Blockchain technologies can empower people by allowing them more control over their user data. Shutterstock

Courtesy of Ajay Kumar Shrestha, University of Saskatchewan

Blockchain has already proven its huge influence on the financial world with its first application in the form of cryptocurrencies such as Bitcoin. It might not be long before its impact is felt everywhere.

Blockchain is a secure chain of digital records that exist on multiple computers simultaneously so no record can be erased or falsified. The...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

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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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

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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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