Category: zerohedge

“It’s time to put that power back where it belongs,” explains Jonathan Zimmerman in today’s Washington Post, “Barack Obama should be allowed to stand for re election just as citizens should be allowed to vote for — or against — him. Anything less diminishes our leaders and ourselves.” The 22nd Amendment, limiting the Presidential term, according to Zimmerman, reflected “a shocking lack of faith in the common sense and good judgment of the people.” Of course, in the increasingly ‘entitled’ America, it would only cost a few hundred million to bribe all the newly downgraded Middle-to-Lower class Americans with Obamaphones in order to finally get a “dictatorial democracy” by indirectly funding the lower common denominator with $400 in free money every election cycle.

 

End Presidential Term Limits (Jonathan Zimmerman),

Via WaPo,

I’ve been thinking about Kilgore’s comments as I watch President Obama, whose approval rating has dipped to 37 percent in CBS News polling — the lowest ever for him — during the troubled rollout of his health-care reform. Many of Obama’s fellow Democrats have distanced themselves from the reform and from the president. Even former president Bill Clinton has said that Americans should be allowed to keep the health insurance they have.

 

…

 

Or consider the reaction to the Iran nuclear deal. Regardless of his political approval ratings, Obama could expect Republican senators such as Lindsey Graham (S.C.) and John McCain (Ariz.) to attack the agreement. But if Obama could run again, would he be facing such fervent objections from Sens. Charles Schumer (D-N.Y.) and Robert Menendez (D-N.J.)?

 

Probably not. Democratic lawmakers would worry about provoking the wrath of a president who could be reelected. Thanks to term limits, though, they’ve got little to fear.

 

Nor does Obama have to fear the voters, which might be the scariest problem of all. If he chooses, he could simply ignore their will. And if the people wanted him to serve another term, why shouldn’t they be allowed to award him one?

 

…

 

the GOP moved to codify it in the Constitution in 1947, when a large Republican majority took over Congress. Ratified by the states in 1951, the 22nd Amendment was an “undisguised slap at the memory of Franklin D. Roosevelt,” wrote Clinton Rossiter, one of the era’s leading political scientists. It also reflected “a shocking lack of faith in the common sense and good judgment of the people,” Rossiter said.

 

…

 

“I think our people are to be safely trusted with their own destiny,” Sen. Claude Pepper (D-Fla.) argued in 1947. “We do not need to protect the American people with a prohibition against a president whom they do not wish to elect; and if they wanted to elect him, have we the right to deny them the power?”

 

It’s time to put that power back where it belongs. When Ronald Reagan was serving his second term, some Republicans briefly floated the idea of removing term limits so he could run again. The effort went nowhere, but it was right on principle. Barack Obama should be allowed to stand for re election just as citizens should be allowed to vote for — or against — him. Anything less diminishes our leaders and ourselves.

It was only yesterday that we highlighted what happens when the entitled elect themselves… a brutal hangover,” and the dismal waste of the Obamaphone program (among many others) suggests we are well down that route:

As Heritage reports, free cell phones for low-income Americans, one of the fastest growing welfare programs in the United States, is—by the Federal Communications Commission’s (FCC) own admission—rife with “waste, fraud and abuse.” And who is paying for these free Obamaphones? If you have a phone subscription, you are.

 

…

 

According to figures supplied by the FCC to The Wall Street Journal, 41 percent of subscribers were unable to prove their eligibility for the program.

 

Indifference to abuse of the program is appalling.

 

…

 

Lifeline has mutated from a program designed to help the needy into a glorified corporate subsidy. Abuse of the program will continue while the FCC scrambles to fix it.

 

An all-expense-paid cell phone, courtesy of those who actually pay for their own service, is not a human right; it’s an insult to struggling families who are reminded every month that their money is lost in yet another sloppy government slush fund.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/-vE5BDtvxCs/story01.htm Tyler Durden

“It’s time to put that power back where it belongs,” explains Jonathan Zimmerman in today’s Washington Post, “Barack Obama should be allowed to stand for re election just as citizens should be allowed to vote for — or against — him. Anything less diminishes our leaders and ourselves.” The 22nd Amendment, limiting the Presidential term, according to Zimmerman, reflected “a shocking lack of faith in the common sense and good judgment of the people.” Of course, in the increasingly ‘entitled’ America, it would only cost a few hundred million to bribe all the newly downgraded Middle-to-Lower class Americans with Obamaphones in order to finally get a “dictatorial democracy” by indirectly funding the lower common denominator with $400 in free money every election cycle.

 

End Presidential Term Limits (Jonathan Zimmerman),

Via WaPo,

I’ve been thinking about Kilgore’s comments as I watch President Obama, whose approval rating has dipped to 37 percent in CBS News polling — the lowest ever for him — during the troubled rollout of his health-care reform. Many of Obama’s fellow Democrats have distanced themselves from the reform and from the president. Even former president Bill Clinton has said that Americans should be allowed to keep the health insurance they have.

 

…

 

Or consider the reaction to the Iran nuclear deal. Regardless of his political approval ratings, Obama could expect Republican senators such as Lindsey Graham (S.C.) and John McCain (Ariz.) to attack the agreement. But if Obama could run again, would he be facing such fervent objections from Sens. Charles Schumer (D-N.Y.) and Robert Menendez (D-N.J.)?

 

Probably not. Democratic lawmakers would worry about provoking the wrath of a president who could be reelected. Thanks to term limits, though, they’ve got little to fear.

 

Nor does Obama have to fear the voters, which might be the scariest problem of all. If he chooses, he could simply ignore their will. And if the people wanted him to serve another term, why shouldn’t they be allowed to award him one?

 

…

 

the GOP moved to codify it in the Constitution in 1947, when a large Republican majority took over Congress. Ratified by the states in 1951, the 22nd Amendment was an “undisguised slap at the memory of Franklin D. Roosevelt,” wrote Clinton Rossiter, one of the era’s leading political scientists. It also reflected “a shocking lack of faith in the common sense and good judgment of the people,” Rossiter said.

 

…

 

“I think our people are to be safely trusted with their own destiny,” Sen. Claude Pepper (D-Fla.) argued in 1947. “We do not need to protect the American people with a prohibition against a president whom they do not wish to elect; and if they wanted to elect him, have we the right to deny them the power?”

 

It’s time to put that power back where it belongs. When Ronald Reagan was serving his second term, some Republicans briefly floated the idea of removing term limits so he could run again. The effort went nowhere, but it was right on principle. Barack Obama should be allowed to stand for re election just as citizens should be allowed to vote for — or against — him. Anything less diminishes our leaders and ourselves.

It was only yesterday that we highlighted what happens when the entitled elect themselves… a brutal hangover,” and the dismal waste of the Obamaphone program (among many others) suggests we are well down that route:

As Heritage reports, free cell phones for low-income Americans, one of the fastest growing welfare programs in the United States, is—by the Federal Communications Commission’s (FCC) own admission—rife with “waste, fraud and abuse.” And who is paying for these free Obamaphones? If you have a phone subscription, you are.

 

…

 

According to figures supplied by the FCC to The Wall Street Journal, 41 percent of subscribers were unable to prove their eligibility for the program.

 

Indifference to abuse of the program is appalling.

 

…

 

Lifeline has mutated from a program designed to help the needy into a glorified corporate subsidy. Abuse of the program will continue while the FCC scrambles to fix it.

 

An all-expense-paid cell phone, courtesy of those who actually pay for their own service, is not a human right; it’s an insult to struggling families who are reminded every month that their money is lost in yet another sloppy government slush fund.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/-vE5BDtvxCs/story01.htm Tyler Durden

As readers may or may not recall, one of the main arguments the bulls had in early 2008, a month after the recession had already begun (according to the NBER’s retrospective conclusion over a year later) to justify that the S&P 500, which had recently hit all time highs of 1546, was not in a bubble is that the projected EPS for the following year, 2009, were 120, which meant the multiple was an oh so very cheap 12x. The same analysis with the even nearer, 2008, S&P EPS which at that point were expected to print just below 100, suggested the S&P at around 1500 was a “healthy” 15x multiple. Unfortunately as the events of 2008 showed, not only did the financial system nearly implode, but earnings, both actual and projected, cratered. The result is that the 2009 EPS which was initially forecast to be $120 ultimately ended up being half of that, or $60 (see chart below), which also meant that the forward multiple of a “very cheap” 12x or so ended up being, drumroll, just a tad bubbly 24x!

Which is why we urge anyone using the naive argument that stocks now are cheap based on forward multiples to observe the following chart, which shows that S&P 500 2013 EPS, projected to be just below 110, are now just above what the S&P was supposed to earn in early 2008 and well below the then projected 2009 EPS. Where it gets more amusing is that the current estimate for 2014 EPS is precisely where 2009 EPS were supposed to land…. before those particular earnings ended up being crushed in half.

Finally as we will show in a subsequent post, 2013 EPS on a GAAP basis are currently precisely $100 with another $10.25 coming from adjustments and other write-offs. Which means that on a recurring Net Income basis, assuming Q4 earnings are roughly in line with expectations, the S&P 500 is currently trading at over 18x GAAP earnings, or as the same people who in 2008 said “the market is not in a bubble” would call it, “cheap.“

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/TJIdVcSMMr8/story01.htm Tyler Durden

We are still technically in the building season for oil supplies which peaked in late May just shy of 400 Million Barrels, before the drawing season kicked off with the exporting of gasoline through increased refinery utilization led by the gulf coast refiners with their increased capacity to take advantage of the spread differential and cheaper operational energy in natural gas to export refined products more competitively than peer nations.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/sxHtF3EuHnA/story01.htm EconMatters

Gross: We should call this “Green Friday” – Be careful, though, of red numbers in 2014. All markets are bubbly.

— PIMCO (@PIMCO) November 29, 2013

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/d-7dnizT-JQ/story01.htm Tyler Durden

Gross: We should call this “Green Friday” – Be careful, though, of red numbers in 2014. All markets are bubbly.

— PIMCO (@PIMCO) November 29, 2013

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/d-7dnizT-JQ/story01.htm Tyler Durden

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/j-ckSHibdLY/story01.htm williambanzai7

It is no secret that the bulk of “very rich people” in recent years has been created in Asia (where some $15 trillion in liquidity has entered broad circulation in just the past five years). As the FT reports, “Asia is producing more new wealth than any other part of the world at any point in history. Over the past five years, the assets of rich individuals have grown at triple the rate of the wealthy elsewhere, while the number of rich people has increased by twice that of other regions. Their number grew by almost 10 per cent to reach 3.7m last year, according to the survey, while their wealth expanded by 12 per cent to $12tn.” However, to find the truly ultra-high-net-worthy (UHNW), those with over $30 million in net assets, one has to go to the US and Europe – the places where Ben’s print baby print policy has most aggressively inflated the latest asset bubble, making the richest richester. “More people from the US and Europe entered this club in the past year than from anywhere else – the population in China and Brazil actually declined slightly.” So how many ultra-high-net-worth individuals are there? The answer: 199,235.

Some observations on how the UHNW allocate their wealth:

They will often have $20m tied in a business, with $5m in property and $5m to play with, says Mykolas Rambus, chief executive of Wealth-X.

…

For those with $30m or more, the first thing they want to buy once they hit that bracket is an aircraft, according to Bassam Salem, chief executive of Citi’s private bank in Asia.

 

“The newly rich are a bit more exuberant in terms of showing their wealth initially,” he says. “But it takes a little while to become ultra-wealthy for most. The richer you are, the less you want to show it in many countries.”

 

The exception to this is mainland China, where more people have become vastly rich in a much shorter time because of the explosive pace of growth in recent years. The average age of Citi’s ultra-rich clients in Asia excluding Japan is about 70, according to Mr Salem, whereas in China it is 35.

Another stunning age-related detail: “the average age of millionaires in China is about 33, but that of the world’s ultra-wealthy is 52.“

Naturally, the ultra wealthy – especially those from China – are the target audience of the UHNW advisors of the world.

“The reason this market is so lucrative is that a lot of the wealth is not very liquid yet,” he says. “They are likely to have a monetising event within a couple of years, like a listing, and they tend to spread their wealth around among a number of banks.”

 

There are many more potential clients among those with $5m or less, but they might only have liquid assets of $250,000 or less. “You cannot make money out of that in today’s high cost regimes,” Mr Rambus adds.

 

The newly rich can be much more demanding clients for private banks and other wealth managers, partly because they can take some convincing that a service they have never used or thought about is worth paying for. On top of this, as they are normally still tied in with their businesses, their investment expectations are for much higher returns than those who have been wealthier for longer and are more interested in preservation.

Sigh – the hard life of advising those for whom money is no object what to invest in…

Finally, if one moves beyond the merely UHNW set, and focuses squarely on the world’s billioanires, of which there are roughly 2170 as we observed previously, the story is a little different.

As Wealth-X reports, the average billionaire is worth US$3.0 billion with a liquidity of 18 percent, equal to US$545 million in cash and other liquid assets per person. This liquidity cushion of over half a billion dollars is higher than it was before the global financial crisis of five years ago, suggesting that the old mantra of “cash is king” remains as relevant as ever.

Private holdings still form the largest component of a typical billionaire’s wealth, with an average of over a US$1 billion in publicly-held companies on top of this.

The breakdown of the average billionaire’s wealth can be seen below:

Ah, the New Normal: $3 billion in assets for some, Wal-Mart stampedes for everyone else.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/hrCDvI_nx48/story01.htm Tyler Durden

It is no secret that the bulk of “very rich people” in recent years has been created in Asia (where some $15 trillion in liquidity has entered broad circulation in just the past five years). As the FT reports, “Asia is producing more new wealth than any other part of the world at any point in history. Over the past five years, the assets of rich individuals have grown at triple the rate of the wealthy elsewhere, while the number of rich people has increased by twice that of other regions. Their number grew by almost 10 per cent to reach 3.7m last year, according to the survey, while their wealth expanded by 12 per cent to $12tn.” However, to find the truly ultra-high-net-worthy (UHNW), those with over $30 million in net assets, one has to go to the US and Europe – the places where Ben’s print baby print policy has most aggressively inflated the latest asset bubble, making the richest richester. “More people from the US and Europe entered this club in the past year than from anywhere else – the population in China and Brazil actually declined slightly.” So how many ultra-high-net-worth individuals are there? The answer: 199,235.

Some observations on how the UHNW allocate their wealth:

They will often have $20m tied in a business, with $5m in property and $5m to play with, says Mykolas Rambus, chief executive of Wealth-X.

…

For those with $30m or more, the first thing they want to buy once they hit that bracket is an aircraft, according to Bassam Salem, chief executive of Citi’s private bank in Asia.

 

“The newly rich are a bit more exuberant in terms of showing their wealth initially,” he says. “But it takes a little while to become ultra-wealthy for most. The richer you are, the less you want to show it in many countries.”

 

The exception to this is mainland China, where more people have become vastly rich in a much shorter time because of the explosive pace of growth in recent years. The average age of Citi’s ultra-rich clients in Asia excluding Japan is about 70, according to Mr Salem, whereas in China it is 35.

Another stunning age-related detail: “the average age of millionaires in China is about 33, but that of the world’s ultra-wealthy is 52.“

Naturally, the ultra wealthy – especially those from China – are the target audience of the UHNW advisors of the world.

“The reason this market is so lucrative is that a lot of the wealth is not very liquid yet,” he says. “They are likely to have a monetising event within a couple of years, like a listing, and they tend to spread their wealth around among a number of banks.”

 

There are many more potential clients among those with $5m or less, but they might only have liquid assets of $250,000 or less. “You cannot make money out of that in today’s high cost regimes,” Mr Rambus adds.

 

The newly rich can be much more demanding clients for private banks and other wealth managers, partly because they can take some convincing that a service they have never used or thought about is worth paying for. On top of this, as they are normally still tied in with their businesses, their investment expectations are for much higher returns than those who have been wealthier for longer and are more interested in preservation.

Sigh – the hard life of advising those for whom money is no object what to invest in…

Finally, if one moves beyond the merely UHNW set, and focuses squarely on the world’s billioanires, of which there are roughly 2170 as we observed previously, the story is a little different.

As Wealth-X reports, the average billionaire is worth US$3.0 billion with a liquidity of 18 percent, equal to US$545 million in cash and other liquid assets per person. This liquidity cushion of over half a billion dollars is higher than it was before the global financial crisis of five years ago, suggesting that the old mantra of “cash is king” remains as relevant as ever.

Private holdings still form the largest component of a typical billionaire’s wealth, with an average of over a US$1 billion in publicly-held companies on top of this.

The breakdown of the average billionaire’s wealth can be seen below:

Ah, the New Normal: $3 billion in assets for some, Wal-Mart stampedes for everyone else.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/hrCDvI_nx48/story01.htm Tyler Durden

Despite a ratings ‘upgrade’ Spain’s youth unemployment rate has re-surged to a record 57.4% (just below that of Greece which still tops the scary chart list at 58%). Italy and Portugal also saw notable rises (despite the former’s record low short-dated bond yields) at 41.2% and 36.5% respectively. Ireland and France saw modest improvements but overall the Euro-zone’s youth unemployment just keeps rising. In spite of all the rhetoric from Merkel, Van Rompuy, and Barroso, 24.4% of Europe’s under-25 population is unemployed…

 

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/5PjwGU8OJgE/story01.htm Tyler Durden