Archive for 2015

France Local Elections: Hollande’s Party (PS) Trounced by Sarkaozy (UMP) and Le Pen (FN)

Courtesy of Mish.

In local French elections over the weekend, Conservatives Hold Off National Front while PS, the party of president Francois Hollande finished a distant third.

France’s centre-right UMP party and its allies have taken first place in the first round of local elections, partial results show.

Projections suggest that the far-right National Front – despite strong gains – came second with about 25% of the vote, behind the conservatives on 30%.

President Francois Hollande’s governing Socialists came third with about 20%.

Voters are electing representatives in 101 departments, or counties, charged with issues like schools and welfare.

The results mean the second round on 29 March will see a run-off between the UMP and the FN in many constituencies.

Le Pen: “We Dislodged PS”

Following the election, a triumphant Marine Le Pen announced “We dislodged PS“.

Via translation from Le Monde:

In an exclusive interview with Le Monde, the president of the National Front believes that the score of his party in the first round of the departmental elections, Sunday, March 22, is a “feat”.

Le Pen: I have always said that beating the results of the European election [25%] would be a triumph. We beat that score score tonight.

Le Monde: You cannot dislodge the role of Nicolas Sarkozy.
Le Pen: The one that has been dislodged is the PS. It was dislodged in a thousand cantons!

Le Monde: You pay for your policy of isolation. The dynamic alliance between the UMP and the UDI allows to garner more votes.
Le Pen: We went from zero local presence to many second rounds. It’s spectacular! Our score reassures everyone, it shows that our standards have reached such a point that some blow when one makes 27%.



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The Web: Destroyer or Savior of Culture, Pay and Employment?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Submitted by Charles Hugh-Smith of OfTwoMinds blog, 

The cost of creating and distributing content has fallen to near-zero, and that is not going away.

Last month I explored the contentious question, Is the Web Destroying the Cultural Economy? In my recent video discussion with analyst Gordon T. Long, we expanded this question to pay (earned income) and jobs, i.e. is the Web eroding pay and jobs?

I also discussed these issues with Mike Swanson of Wall Street Window in a podcast Is The Web Destroying the Cultural Economy? An historian by training, Mike is well-placed to put these issues in a larger context.

There are several key dynamics at work. One is the democratization of expression and journalism unleashed by the Web has eroded the industrial meritocracy of gatekeepers and vertically integrated content-media corporations: music labels, publishers, newspapers, etc.

The web has enabled virtually anyone with Internet access to create a nearly-free global distribution network--what I have termed 800 Million Channels of Me (February 21, 2011). This blog is obviously one of those millions of globally distributed channels.

Critics of this democratization feel that this has unleashed an avalanche of mediocrity that is judged on “likes” and pages views--a process in which talent is “lost in a sea of garbage.”

The other side of the debate sees the demise of the gatekeepers, who could enforce their own view of what was valuable culturally and economically, as freeing all those who could never get past the gatekeepers. This explosion of creativity and expression is an unalloyed good thing.

It does create a new problem and a new need--some way to curate the flood of new content, as no one digital consumer can possibly listen to, read or watch more than a tiny sliver of the content being produced.

This curation and editorial selection is an intermediary layer between the creator of content and the end user--a layer that replaces the old industrial-meritocracy with a free-floating, self-organizing group of intermediaries who add value by sorting through a larger slice of the web’s gargantuan output of content.

But few deny that this flood of free content--music, books, articles, videos, etc.--has drastically reduced the income paid to content creators. Take the porn industry, for example, a once-profitable distribution system for adult content. Now that virtually anyone can…
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Is It Racist? Starbucks Gives Up Trying To Solve America’s ‘Other’ Great Divide

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Just as The Fed folded this week on ending the nation's booming income inequality problem (by reinforcing the Yellen put for longer), so Starbucks has folded in its effort to fix the other growing divide in America – racism. Careful not to admit that it was due to pressure from the avalanche of less-than-positive social media reactions, AP reports Starbucks baristas will no longer write "Race Together" on customers' cups. "Nothing is changing," Starbucks claims it was all part "of the cadence" of the plan – hhmm. "Most people come to Starbucks for coffee," concludes one young African-American, adding "race is an uncomfortable thing to bring up, especially in a Starbucks."

As AP reports,

Starbucks baristas will no longer write "Race Together" on customers' cups starting Sunday, ending as planned a visible component of the company's diversity and racial inequality campaign that had sparked widespread criticism in the week since it took effect.

The coffee chain's initiative will continue more broadly without the handwritten messages, Starbucks spokesman Jim Olson said.

The cups were always "just the catalyst" for a larger conversation, and Starbucks will still hold forum discussions, co-produce special sections in USA TODAY and put more stores in minority communities as part of the Race Together initiative, according to a company memo from CEO Howard Schultz said.

The campaign has been criticized as opportunistic and inappropriate, coming in the wake of racially charged events such as national protests over police killings of black males. Others questioned whether Starbucks workers could spark productive conversations about race while serving drinks.

The phase-out is not a reaction to that pushback, Olson said. "Nothing is changing. It's all part of the cadence of the timeline we originally planned."

He echoed the company memo, saying of the Race Together initiative, "We're leaning into it hard."

As one commentator noted, "I've not read a single positive Tweet or commentary on the @Starbucks #RaceTogether effort."

At a Starbucks in Pittsfield Township, Michigan, near Ann Arbor, two customers said on Sunday they didn't think a coffee shop was the right place for race relations dialogue.

Ninette Musili, a junior biomolecular science major at the University of Michigan, said the campaign seemed to her like an insincere publicity stunt that wasn't executed properly.

Like many who criticized Starbucks, she goes to


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“Unequivocally Good” For Obama’s Middle Class

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Presented with no comment…

Source: Townhall





Spot The Odd One Out

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

We hate to spoil the surprise, but the answer, as clearly shown by the first blue bar on the chart below, is Energy, and specifically the ridiculous valuation that energy companies are currently trading at. Why? Because as the following Factset chart shows, the forward P/E of the energy sector is currently 27x – an all time high – and which is more than double the historical multiple of this sector.

It also means that even though earlier today we were amused by the ridiculous valuation of the profitless biotech sector, perhaps it is time to mock the various energy names just as vociferously.

So how does one explain this lunacy? Simple: the BTFDers who are by now largely all-in the energy space, are hoping other BTFDers will come and lift oil, despite our repeated warnings that the price of oil is very more likely to plunge in June not only as a result of the US running out of storage capacity but, perhaps far more importantly as we first reported yesterday, North Dakota is likely to see a “big surge” in production this June, potentially besting another supply record even if prices continue to crater, according to Lynn Helms, director of the state’s Department of Mineral Resources, as a result of a tax loophole that will be triggered in June.

Then again, in a market in which central banks are willing and able to buy CL and Brent futures, nothing would surprise us anymore, and it possible that oil will surge right back to $88 and above, the only price at which the current valuation of energy companies makes sense. If it doesn’t, and the closer we get to the end of 2015 the more unrealistic this assumption becomes, energy stocks are looking at an air pocket that will wipe out some 50% of their value in the near future as we explained almost two months ago in “Either Oil Soars Back To $88, Or Energy Stocks Have To Tumble By Over 40%.”

Indicatively, back then the forward energy P/E multiple was “only” 22.4x. Now it is 27x and rising with every passing day!

So for those who missed our analysis back then, here it is again. The only thing that has changed is how much energy equities would have to…
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Central Banks, Credit Expansion, and the Importance of Being Impatient

Courtesy of ZeroHedge. View original post here.

Submitted by rcwhalen.

Below is an extended excerpt from a research note based on the presentation I am giving at the Banque de France on Monday, March 23, 2015, for an event organized by the Global Interdependence Center (GIC) entitled “New Policies for the Post Crisis Era.” You can read the entire note and all of KBRA’s excellent research at www.kbra.com.  Free registration is required. — Chris 

Summary

Investors are keenly focused on the Federal Open Market Committee (FOMC) to see whether the U.S. central bank is prepared to raise interest rates later this year – or next. The attention of the markets has been focused on a single word, “patience,” which has been a key indicator of whether the Fed is going to shift policy after nearly 15 years of maintaining extraordinarily low interest rates. This week, the Fed dropped the word “patience” from its written policy guidance, but KBRA does not believe that the rhetorical change will be meaningful to fixed income investors. We do not expect that the Fed will attempt to raise interest rates for the balance of 2015. 

This long anticipated shift in policy guidance by the Fed comes even as interest rates in the EU are negative and the European Central Bank has begun to buy securities in open market operations mimicking those conducted by the FOMC over the past several years. Investors and markets need to appreciate that, regardless of what the FOMC decides this month or next, the global economy continues to suffer from the effects of the financial excesses of the 2000s. 

The decision by the ECB to finally begin U.S. style “quantitative easing” (QE) almost eight years after the start of the subprime financial crisis in 2007 speaks directly to the failure of policy to address both the causes and the terrible effects of the financial crisis. Consider several points:

  • QE by the ECB must be seen in the context of a decade long period of abnormally low interest rates.  U.S. interest rate policy has been essentially unchanged since 2001, when interest rates were cut following the 9/11 attack. The addition of QE 1-3 was an effort at further monetary stimulus beyond zero interest rate policy (ZIRP) meant to boost asset prices and thereby change investor tolerance


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Large Cap ‘Bull Traps’ Under Pressure

Courtesy of Declan.

Friday’s solid gains helped push both the Dow Jones Industrial Average and S&P into challenges of their respective ‘Bull Traps’. The big volume surge also marked a strong accumulation day for both indices. In the case of the S&P, there was a MACD trigger ‘buy’, but not quite an On-Balance-Volume ‘buy’ trigger, with which to work with.


The Dow Jones Industrial Average hasn’t quite generated a MACD trigger ‘buy’, but it did manage an On-Balance-Volume ‘buy’ signal.

The Russell 2000 isn’t having any such worries. Small Caps gapped higher and closed near highs. The index has plenty of wiggle room to nearest support.

The Nasdaq gapped higher and finished at a new high. However, it wasn’t able to build off the opening gap, although it’s coming close to tagging the 10% envelope (from the 200-day MA) and technicals returned net bullish.

The Semiconductor Index was able to do a little better, although it finished just shy of a new high. Aside from the Russell 2000, this has been (for me) one of the star performers over the last 6 months.

Next week is likely to be about consolidation for the Russell 2000 and breakouts for the S&P and Dow. Tech indices are caught a little in the middle, so it will likely take a few days to determine what may be next in store for them.

You’ve now read my opinion, next read Douglas’ and Jani’s.





Drowning In Liquidity But None In The Bond Market: The Spark Of The Next Financial Crisis?

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Of all the themes we’ve been pounding the table on of late, the idea that a lack of liquidity in certain markets will eventually lead to an “accident” or “adverse event” (to use the Center for Financial Stability’s words) is perhaps the most pressing because with the Mario Draghis and Haruhiko Kurodas of the world intent on monetizing every bit of government paper they can get their hands on, “outlier” events such as the Treasury flash crash that occurred last October are likely to become far less outlier-ish as central banks discover that depriving the market of anything that even approximates high quality collateral can have a rather nasty destabilizing effect in a pinch. Two weeks back, we summarized the situation as follows: 

As central banks work to monetize all net (and sometimes gross) government bond issuance in their respective jurisdictions, QE is destabilizing markets by sapping liquidity which in turn inhibits price discovery and creates volatility. This is on display in Japan, where 2 out of 3 dealers think the JGB market is impaired thanks to BoJ asset purchases and where many officials are beginning to get more vocal about the possibility that a lack of liquidity could have “dire consequences.” Similarly, market financing via shadow banking conduits has declined by nearly half since 2008 in the US, and with dealers unwilling to hold inventory of corporate paper thanks to tougher capital requirements, the stage is set for what the Center for Financial Stability recently called “an accident.” Here’s what  the SEC’s Daniel Gallagher had to say recently about liquidity in the US corporate bond market (via Bloomberg): “Lack of liquidity in corporate bond market is ‘systemic risk’ not addressed by regulators, SEC Commissioner Daniel Gallagher says in public remarks. Gallagher cites 80% decline in corporate bond inventories among dealers and impact of higher interest rates on future trading needs; ’that has accompanied a record level of issuance year after year since 2008 of $1 trillion-plus of corporate debt.’”

Building on this theme, we went on to highlight a UBS note which analyzed Fed rate hiking cycles for clues as to what the market should expect in terms of corporate spreads if and when a “diminutive” Janet Yellen decides to go ahead with a “liftoff.” What UBS found was rather disconcerting: …
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The Perfect Storm For Oil Hits In Two Months: US Crude Production To Soar Just As Storage Runs Out

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Less than two weeks ago we warned that based on the current oil production trend, the US may run out of storage for crude as soon as June.

This is what we said back in early March when the BTFDers were hoping WTI in the low $40s would never again be seen:

Come June, when all available on-land storage is exhausted, each incremental barrel will have to be dumped on the market forcing prices lower and inflicting further pain on the entire US shale complex (just as Q1 results are released which will invariably show huge writedowns as companies will no longer be able to hide behind the SEC-mandated accounting trick that made Q4 results appear respectable). Here’s Soc Gen:  “…oil markets can be impatient and prices could drop considerably lower. As we have written previously, we are currently more concerned about downside risk than upside risk.”

Since then, as expected, crude tumbled to new post-Lehman lows, confirming the global deflationary wave is raging (for more details please see China), and WTI only posted a rebound on quad-witching Friday as another algo-driven stop hunt spooked all those who were short the energy complex.

The problem is that despite the latest “dead oil bounce” we have since had to revise our forecast for full US oil storage, and pulled forward the date when this will happen in the aftermath of the latest API inventory data.

Recall that earlier this week API reported, and EIA later confirmed, that for the 10th week in a row there was a “massive 10.5 million barrels (far bigger than the 3.1 million barrel expectation) and a 3 million barrel build at Cushing. If this holds for DOE data tomorrow (and worryingly API has tended to underestimate the build in recent weeks) it will be the biggest weekly build since 2001.”

The DOE indeed confirmed all of this:

It also means that at the current rate of record oil production, storage will be exhausted in under two months, some time in mid-May. At that point, with no more storage to buffer the record oil production, the open market dumping begins and prices of WTI will crater as every barrel will have to be sold at any clearing price, since the…
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Washington Blinks: Will Seek Partnership With China-Led Development Bank

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Don’t look now, but Washington just blinked. As we’ve documented exhaustively over the past week, pressure has been building steadily for the US to strike some manner of conciliatory tone towards China with regard to the Asian Infrastructure Investment Bank, a China-led institution aimed at rivaling the US/Japan-backed ADB. Britain’s decision to join China in its new endeavor has prompted a number of Western nations to throw their support behind the bank ahead of the March 31 deadline for membership application. Because the AIIB effectively represents the beginning of the end for US hegemony, the White House has demeaned the effort from its inception questioning the ability of non-G-7 nations to create an institution that can be trusted to operation in accordance with the proper “standards.” Now, with 35 nations set to join as founders, it appears Washington may be set to concede defeat. Here’s more, via WSJ:

The Obama administration, facing defiance by allies that have signed up to support a new Chinese-led infrastructure fund, is proposing the bank work in a partnership with Washington-backed development institutions such as the World Bank.

The collaborative approach is designed to steer the new bank toward economic aims of the world’s leading economies and away from becoming an instrument of Beijing’s foreign policy. The bank’s potential to promote new alliances and sidestep existing institutions has been one of the Obama administration’s chief concerns as key allies including the U.K., Germany and France lined up in recent days to become founding members of the new Asian Infrastructure Investment Bank.

The Obama administration wants to use existing development banks to co-finance projects with Beijing’s new organization. Indirect support would help the U.S. address another long-standing goal: ensuring the new institution’s standards are designed to prevent unhealthy debt buildups, human-rights abuses and environmental risks. U.S. support could also pave the way for American companies to bid on the new bank’s projects.

“The U.S. would welcome new multilateral institutions that strengthen the international financial architecture,” said Nathan Sheets, U.S. Treasury Under Secretary for International Affairs. “Co-financing projects with existing institutions like the World Bank or the Asian Development Bank will help ensure that high quality, time-tested standards are maintained.” 

So essentially this is just the old “if you can’t beat ‘em, join ‘em” strategy disguised as an…
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ValueWalk

#1 Performing Global Macro Hedge Fund Sees More Shorts Opportunities Ahead As China Bursts

By Jacob Wolinsky. Originally published at ValueWalk.

Crescat Global Macro Fund update to investors on 1/19/2019

Crescat Global Macro Fund and Crescat Long/Short fund delivered strong returns for both December and full year 2018 in a difficult market. Based on ...



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Zero Hedge

Johns Hopkins, Bristol-Myers Face $1 Billion Suit For Infecting Guatemalan Hookers With Syphilis 

Courtesy of ZeroHedge. View original post here.

A federal judge in Maryland said Johns Hopkins University, pharmaceutical company Bristol-Myers Squibb and the Rockefeller Foundation must face a $1 billion lawsuit over their roles in a top-secret program in the 1940s ran by the US government that injected hundreds of Guatemalans with syphilis, reported Reuters.

Several doctors from Hopkins an...



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Phil's Favorites

Divisive economics

 

Guest author David Brin — scientist, technology consultant, best-selling author and futurist — explores the records of Democrats and Republicans on the US economy in the following post. For David's latest posts, visit the CONTRARY BRIN blog. For his books and short stories, visit his web...



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Kimble Charting Solutions

Stock declines did not break 9-year support, says Joe Friday

Courtesy of Chris Kimble.

We often hear “Stocks take an escalator up and an elevator down!” No doubt stocks did experience a swift decline from the September highs to the Christmas eve lows. Looks like the “elevator” part of the phrase came true as 2018 was coming to an end.

The first part of the “stocks take an escalator up” seems to still be in play as well despite the swift decline of late.

Joe Friday Just The Facts Ma’am- All of these indices hit long-term rising support on Christmas Eve at each (1), where support held and rallies have followed.

If you find long-term perspectives helpf...



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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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Insider Scoop

Cars.com Explores Strategic Alternatives, Analyst Sees Possible Sale Price Around $30 Per Share

Courtesy of Benzinga.

Related 44 Biggest Movers From Yesterday 38 Stocks Moving In Wednesday's Mid-Day Session ...

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Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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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"

 

 

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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.

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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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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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