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  • The Stock Market Has Reached "A Permanently High Plateau" -- If The Fed Does Not Mess Up Again [View article]
    "This is the inverse of 'The Death of Equities' article, now seen as the perfect time to go long equities."

    Yes, bringing up a reprise of Irving Fisher's immortal "permanently high plateau" assessment from 1929 and applying it - seriously! - to today's Fed and debt-pumped equities casino using cherry-picked supporting data only, is best seen as a ringing of the bell near the top.
    Jul 24 02:19 PM | 3 Likes Like |Link to Comment
  • What We're Reading This Morning — July 23, 2014 [View instapost]
    Thanks for some most interesting and worthwhile reading.

    Brief, too!
    Jul 23 01:03 PM | Likes Like |Link to Comment
  • Making The Rich Richer [View article]
    Rolling Stone magazine article in 2009 by Matt Taibbi referring to Goldman Sachs (NYSE:GS), the world's most powerful investment bank: "A great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."

    Macro Investor - Yes, we should worry about giant squids.
    Jul 22 06:04 AM | Likes Like |Link to Comment
  • The Fed's Rocket To Nowhere [View article]
    The herd assumes Treasuries are "risk-free" and are thus sure to remain the asset of choice in any "flight to safety" and will that they will only gain in value if the economy continues to tank even though that will result in an even more ludicrous level of supply.

    Tank it does, on Main Street during this pathetic statistical "recovery" bought by the most expensive public debt-fueled "wealth effect" ever devised. As the world has been flooded by unprecedented Treasuries and other Western debt yet bid this paper to it's highest levels ever along with the obvious junk, little attention has been given the increase of risk that goes by definition with excess supply which are claims which the issuers are expected to pay.

    This (payment of interest, let alone principle) becomes impossible short of printing even more fiat currency (Quantitative Counterfeiting) when "recovery" fades which at some point interest rates will rise rather than fall during the next economic dip due to an even more grossly excessive supply of debt and a belated recognition of a national solvency crisis.

    At some point given the hopeless addiction of Western politicians to the vastest Tulip Mania of all time, sovereign debt issuance, the teaser rates on public debt to finance parasitism, paper profits and elite bailouts at the expense of productive enterprise will expire and the paper issued to finance this, Treasuries, for the most grandiose of all Ponzi schemes will head towards it's true, far lower, value.
    Jul 21 08:25 AM | 2 Likes Like |Link to Comment
  • eBay Has Its Positives, But Don't Buy It Just Yet... Here Is Why [View article]
    "A lot of the "potential" that many speculators are claiming Alibaba has to significantly alter the current system is over-blown."

    What part about Alibaba charging 3-4% fees as compared with Ebay charging small sellers 10% plus 4% for using Paypal which is required, is over-blown as an advantage to sellers? It's actually simple: Ebay and Amazon have become hooked on massively overcharging for their services to pad management bonuses and have left the door open for another site to charge at the level Ebay once did when it expanded to become the once-dominant site in e-commerce. It's not complicated how they relinquished their competitive advantage via excessive charges and destructive rule-changes.
    Jul 20 06:25 PM | Likes Like |Link to Comment
  • eBay Has Its Positives, But Don't Buy It Just Yet... Here Is Why [View article]
    "Perhaps the company is actually a strong company, but unfortunately structured in a way that cannot allow management to realize its full potential."

    The problem is an upper management culture that is addicted to short-term fixes for quarterly bonuses and which is utterly out of touch with and alienated against it's natural core constituency and customers - small sellers.

    Technologically Ebay has always been a day late and a dollar short on it's site (it's not in Amazon's league) and likely with Paypal as compared with competitors and with possibilities that Paypal could facilitate such as the vast potential for serving customers via reducing transaction and currency conversion costs perhaps through an e-currency. No, it is mostly left to others more enlightened to carry out worthwhile endeavors that genuinely serve customers rather than the focus on the overcharging that is CEO John Donahoe's core business strategy.

    Viral internet support and far greater success overseas were easily within Ebay's grasp but for the antipathy Donahoe brings to small sellers who are recognized as failures by definition to Ebay and thus carelessly alienated and cast aside. This has created an amazing and entirely unnecessary culture clash that has hobbled one of the most obvious and successful cash cows of all time - the online Ebay marketplace - and it's growth to below the rate of online commerce generally.

    If CEO John Donahoe is replaced, there could be a serious chance yet for Ebay and Paypal to present an investment opportunity with real possibilities, but until then Ebay will continue to wither as compared against competition which it once dwarfed while focusing on it's misguided efforts to ape Amazon and in finding new ways to overcharge it's customers rather than better ways that enable them to succeed in a relationship of mutual benefit.
    Jul 20 11:16 AM | 1 Like Like |Link to Comment
  • The Counterfactual Case Against ZIRP [View article]
    Nice summation of many factors that constitute the distortion of signals that ZIRP provides markets that gives insider participants perverse incentives to game the system for personal short term paper gains that create no wealth or value outside the small circle of these beneficiaries. And clearly the "wealth effect" that has benefitted the wealthy so disproportionately has not trickled down to Main Street which remains comatose.

    Many paper positions will be unwound forcibly under more normalized conditions and it is seen who has been swimming naked. And leverage will be found to have been used more than ever by Wall Street to magnify their gains in this artificially low interest rate environment that will dwarf the excesses exposed in the 2008 meltdown as is clearly evidenced by the record margin debt that is one of the props to equities now.

    This doesn't even address the use of Quantitative Counterfeiting to keep ZIRP on track. And when ZIRP teaser rates expire, governments spending and obligations will be found overcommitted to say the least, which will create unprecedented havoc at just the wrong moment since the gross misallocation of capital is a hallmark of Western governments on a grander scale than ever before given record low rates for Treasuries and even lower rates for Greek and Spanish bonds LOL.

    ZIRP has been a fraud and it facilitates fraud by obliterating legitimate economic signals while benefiting the few and enabling governments to bloat via unprecedented deficits while private jobs and productive wealth creation languish. Eventually it will dawn on enough participants that no viable stream of income or assets is backing much of the record mountain of debt issued, which will create an unwind like no other even as the devastated taxpayer balance sheet and unmerited "confidence" in fiat scrip no longer provide cover for even more extravagantly "extraordinary" measures.
    Jul 18 08:10 AM | 1 Like Like |Link to Comment
  • Making The Rich Richer [View article]
    Exactly true by definition: The policy of creating a "wealth effect" has only enriched those with assets - mostly the rich - and created mostly just additional costs for Main Street for all essentials that had been mercifully eased during the "dark" days of 2008-9, such as sub-$1.50/gallon gas. We know that was "bad" because all elites and policymakers including our President tell us so, and that right now we need mainly fear deflation even as gas prices hover around $4.00/gallon.

    Unfortunately the apparent success of all this mind-numbing lying and phoniness is a culmination of many generations of increasingly acclimating Americans to herding and becoming followers, starting with banal but not innocuous centralized curricula emanating from Washington and accompanied by centralized MSM lying and academic sycophancy that would make Orwell blush. And hopeless levels of debt, now heaped on the society to directly benefit ever-expanding parasitism and to collectivize the losses of the rich are a well-known method of suppressing independence as the founders of the United States repeatedly warned.

    That lying by statistics and via acclimation by elites is becoming more blatant than ever is seen in a stated policy of creating a "wealth effect" and denying that it benefits almost exclusively the wealthy.
    Jul 17 07:45 AM | 14 Likes Like |Link to Comment
  • Will Amazon's Drones And Other Novel Initiatives Ever Justify Its Lofty Multiple? [View article]
    Sure, and they sell for instance, books both themselves and through third parties, so adding wouldn't be their first additional bells and whistles duplication likely to earn more of the heretofore perennial applause of bubbly, Bernankebucks-fueled Wall Street.
    Jul 14 06:40 PM | 2 Likes Like |Link to Comment
  • Will Amazon's Drones And Other Novel Initiatives Ever Justify Its Lofty Multiple? [View article]
    When one considers the imminent entrance of Alibaba into online commerce in the US, a company which has grown to a larger size than Amazon and Ebay combined thanks to the grossly exorbitant fees the American companies have milked their 3rd party sellers for, Amazon's days at dotcom redux valuations are numbered for this reason alone.

    That there are forays into commoditized businesses that have no prospect of high margins ever shows that markets can remain irrational longer than.....

    Idea to Jeff Bezos: How about getting into the pet supply business? The name "" may still be available for a reasonable fee and I'm sure Wall Street is ready to bid the stock price higher on the news.
    Jul 14 02:38 PM | 2 Likes Like |Link to Comment
  • U.S. Dollar Chart: Clueless About Currency Markets [View article]
    This author's work is quite similar to the those found in the Mensa Bulletin where most of the writing is spent citing author's amazing thought process with surprisingly little actual substance, given the abundent self-observed gifts available to the task.

    There is little but surmise, anecdotes and hubris supporting the conclusion of this article, which contradicts the fact that the Industrial Revolution took place in the US with a dollar that retained roughly the same value from the late 18th century until 1911 just before banksters and big government advocates spawned a Federal Reserve that enabled a culture of ponzi finance and insider profiteering far more than any actual human progress that has since transpired.
    Jul 11 02:45 PM | 3 Likes Like |Link to Comment
  • Wall Street Breakfast: GM Testimony, Citigroup Settlement, Immigration Crisis [View article]
    "Oddly enough I do think millions of new citizens who vote a particular way does benefit some in Washington.....I honestly believe this is the story behind all these contrasting views and has little to do with desire to help and be humanitarian."

    Jul 9 09:06 AM | 5 Likes Like |Link to Comment
  • 3 Reasons Today's Environment Is Not Like The 1970s [View article]
    The 70's featured a US that was the world's greatest creditor. Now it's the all-time king of debtors in a world awash with staggering sovereign debtors. Hence, how much more "dry powder" aside from more printed or ponzi-financed can there be for Washington to hyperspend on additional crisis or merely to keep the same dreary joke of a New Normal "recovery" going that requires at least hundreds of conjured $billions to come from somewhere every year?
    Jul 9 08:27 AM | 2 Likes Like |Link to Comment
  • Seadrill cancels $1B debt issue after steep slide in share price [View news story]
    Been a lot of pump articles on SDRL lately, lauding it's spending-intensive acquisition of more and newer everything for all occasions. The dump may have come prematurely as it did spike the latest binge in company plans.
    Jul 9 08:06 AM | 1 Like Like |Link to Comment
  • Wall Street Breakfast: GM Testimony, Citigroup Settlement, Immigration Crisis [View article]
    "So who buys Greek bonds for 'just under 3%'?"

    Behind the curtain no doubt stand the CB's working together orchestrating the Great Ponzi to it's final crescendo. Low rates for all who are deemed systemically important so there is even more fundamentally worthless and unbacked financial paper for mega financiers to leverage and dump onto the taxpayers when it eventually fails.
    Jul 9 07:54 AM | 4 Likes Like |Link to Comment