Category: zerohedge

When Barack Obama, floundering in the endless humiliation from the disastrous rollout of Obamacare, gave the country’s insurance  companies the “put option” to reject the one-year “cancellation” extension fix stemming from the whole “if you like your plan, you can keep it, period” fiasco, he committed a cardinal sin – he lost control of the situation, because from that point onward the decision was no longer in his court. Furthermore, due to the syndicate nature of insurance companies and state insurance commissioners implementing Obamacare, suddenly the decision was subject to game theoretical facets including cooperation and defection, or rather just defection since at this point the biggest spoils would go to whoever had the initial leverage or rather, defiance of the president. Sure enough, California just flopped on Obama’s most recent flip when the state, moments ago, rejected Obama’s proposed fix to allow legacy plans to survive for one additional year.

• CALIFORNIA REJECTS OBAMA’S INSURANCE CANCELLATION FIX
• CALIFORNIA REJECTS 1-YEAR EXTENSION OF CANCELED INSURANCE PLANS

More from Bloomberg:

California officials implementing President Barack Obama’s health-care overhaul rejected a one- year extension of insurance plans that are to be canceled under the law.

 

The president has urged states to give people with substandard medical plans an additional year to meet the law’s requirements after hundreds of thousands  received cancellation notices and were told new policies to meet minimum rules for coverage would cost more. “That’s making the best of not-great options, but I think it’s the best option and then we can focus in the coming months on the enrollment we need,” Peter V. Lee, the executive director of Covered California, the health exchange, said today at a meeting in Sacramento.

 

California’s decision is critical to the roll-out of Obamacare nationwide. The most populous U.S. state, which received almost $1 billion in federal grants to implement the Patient Protection and Affordable Care Act, led the U.S. in signups last month. The law requires all Americans to be covered next year or pay a penalty.

 

It’s up to state regulators and insurance companies to decide whether to delay the cancellations, which conflicted with Obama’s promise that consumers who liked their existing plans could keep them.

 

The exchange said 79,891 Californians had selected a health plan through Covered California as of Nov. 19. Enrollment began Oct. 1.

And from AP:

The board overseeing California’s health insurance exchange has voted to stick with its current approach of phasing out by year’s end health insurance policies that do not meet current benefit requirements. The Covered California Board of Directors voted 5-0 on Thursday to hold steady on its current approach, defying President Barack Obama’s recent flip on one crucial aspect of the Affordable Care Act.

 

The state insurance commissioner had said that 1.1 million Californians are receiving notices that their current individual health insurance policies will be discontinued in 2014 because they do not meet the benefit requirements of the federal health care overhaul.

 

That has angered some policy holders, many of whom will see their monthly premiums and deductibles rise sharply with the new plans being offered. It also flies in the face of promises Obama made repeatedly when he said people who liked their current health insurance policies could keep them under his health insurance reforms.

 

The president has since backtracked and has asked states to allow insurance companies to extend those older policies.

 

But many insurance companies oppose that, saying doing so would undermine the new markets being set up under Obama’s law. They also said they did not have enough time to rebuild policies they already had discontinued.

And while Calirofnia’s decision certainly makes sense financially for the insolvent state (if not any other more prudent states), it merely adds to Obama’s political crucifixion as now it will appear as if he has lost all control over not just the website enrollment process, but also the entire onboarding process and is unable to even keep beneficiary states under control.

Welcome to socialist central planning 101 – where everything that can go wrong, sooner or later does.

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“All fixed”

 

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“All fixed”

 

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France’s General de Gaulle once said that the only thing that would unite Europe would be China. At the time he was probably visionary in the knowledge that the Europeans would never unite. There was too much rivalry and there always has been. The British and the French have always been at odds and the French have always been jealously wary of the German’s capacity to work harder than they can and to show the full fruit of their industriousness. The Germans have always secretly known that they are the best and looked down upon the then agriculturally-oriented (and therefore worthless, in their eyes) countries like Italy, Spain and Portugal. He certainly got one other thing correct when he said that it would be the Chinese.

Europeans would only unite when the Chinese forced them to.

China has become not only demographically the leading country of the world, but they have become economically the country to invest in and commercially number one. That’s all cause for concern.

They have taken over from Japan as the Land of the Rising Sun. The sun set a long time ago on that Empire and we don’t even need to mention the failures of the US system that have resulted in its decline. The good thing about the Chinese is that they have no qualms about despising democracy and espousing dictatorship. The West just makes a show of brash support for the former and public outcry at the latter. Then, it does exactly as it chooses, flouting what itdictates to be democratic. The West dictates democracy while the Chinese plod on solemnly on their Long March towards success. China is already the number one trading nation of the world and has been since 2012.

Left in the Dark

The West will be left in the dark begging for the lights to come back on soon as they realize that China has not only become the world leader in yet something else, namely solar-panels, but also that the West has been pointing their own solar panels in the wrong direction now for years.

A new study that was carried out in the US has suddenly discovered that the solar panels that have been installed around the world and that all face South are in actual fact facing the wrong direction.

According to the study carried out by the Pecan Street Research Institute if the panels face West, they increase electricity production by 49% during peak demand.

What is surprising is that nobody has ever carried out a study on the best direction to gain increases in electricity generation. People simply presumed that it was South that would give the best energy-supply levels.  The study showed the panels that faced South only generated a 54%-peak reduction (peak: 3pm to 7pm), while panels that faced Westwards were able to generate a 65%-peak reduction. The CEO of Pecan Street Research Brewster McCracken stated that “there was no other residential demand response tool generating 60% reductions.”

Europe and the West will be going back to lighting candles that they will probably end up buying also from the Chinese in the next few years. How is it conceivable to imagine that those that are paid to do research might not have actually carried out tests to see in which direction the solar panels should have been facing?

• By using solar panels the world could be powered with relatively little surface area covered today by their installation.
• It would take about the surface area of Spain to do so or just over 190, 000 square miles.
• Today however the US only generates 0.17% of its power from photovoltaic sources, generating 6.9 million megawatt-hours of electricity.
• Solar energy has increased in the USA and in 2007 it increased by 17%.
• There are some that believe that it could grow to an estimated 10% of energy needs of the USA within the next decade.
• The US accounts for 10% of the world’s market share of installations and its own electric capacity from solar power increased by 76% between 2011 and 2012.
• The Federal government believes that it is a viable source of energy and just powering the US would only use 0.5% of the available energy that the sun has, according to experts.
• There is a current investment of $968 million via federal subsidies to the solar-power industry in the US.

China is set to become the world’s leader in all renewable energy sources. Not only will they have the world economically-speaking but they will have the world in terms of controlling their energy supply.

• China plans to produce 21 gigawatts by 2015 from solar power.
• 80% of electricity comes from coal today in China and the recent problems with air pollution that have plagued major cities are set to be a thing of the past.
• China has become the world’s largest producer of solar panels in the world and they have managed to do so in just two years (with 30% of the solar-panel market today).
• Research (Harvard and Tsinghua Universities) shows that all electricity demand could be met by renewable sources within the next fifteen years for the country.

Let’s hope they manage to get the panels facing in the right direction!

 

Originally posted: Solar Panels: Back to the Dark Ages

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 Indian Inflation: Out of Control? | Greenspan Maps a Territory | Gold Rush or Just a Streak? | Obama’s Obamacare: Double Jinx | Financial Markets: Negating the Laws of Gravity  |Blatant Housing-Bubble: Stating the Obvious | Let’s Downgrade S&P, Moody’s and Fitch For Once | US Still Living on Borrowed Time | (In)Direct Slavery: We’re All Guilty |

Technical Analysis: Bear Expanding Triangle | Bull Expanding Triangle | Bull Falling Wedge | Bear Rising Wedge | High & Tight Flag

 

 

 

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David Einhorn begins his discussion on the market warning that “certain aspects of the market are very much in bubble,”  with investors “dismissing valuation metrics.” “The market is confused,” between useful products and real profit streams, he suggests for a number of headline-grabbing higly speculative names. More broadly, Einhorn believes real damage has been done by Fed policy, and is “not convinced if or when they will ever taper.” Crucially, he adds, we may see another rollover/recession and “the Fed will pour more fuel on the fire.” The cognitive bias he exposes is that most people believe the Fed policy is supporting the economy (in some way), whereas (as we noted here) there are real costs and as Einhorn notes “Fed policy is a headwind to the economy,” as he quantifies the hundreds of billions in lost interest income relative to wealth gains. Owning gold makes sense, he adds, “in case they lose control.”

 

“I’m not convinced when — or if they’ll ever taper,” he said. “I don’t know. We may go into the next crisis, the next depression/recession rollover, and the next move might be to pour more fuel on the fire. It wouldn’t surprise me in the slightest.”

Einhorn’s broad market thoughts begin at 5:30,

 

And his gold comments begin at 10:30,

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/9Ep9fxC6idE/story01.htm Tyler Durden

David Einhorn begins his discussion on the market warning that “certain aspects of the market are very much in bubble,”  with investors “dismissing valuation metrics.” “The market is confused,” between useful products and real profit streams, he suggests for a number of headline-grabbing higly speculative names. More broadly, Einhorn believes real damage has been done by Fed policy, and is “not convinced if or when they will ever taper.” Crucially, he adds, we may see another rollover/recession and “the Fed will pour more fuel on the fire.” The cognitive bias he exposes is that most people believe the Fed policy is supporting the economy (in some way), whereas (as we noted here) there are real costs and as Einhorn notes “Fed policy is a headwind to the economy,” as he quantifies the hundreds of billions in lost interest income relative to wealth gains. Owning gold makes sense, he adds, “in case they lose control.”

 

“I’m not convinced when — or if they’ll ever taper,” he said. “I don’t know. We may go into the next crisis, the next depression/recession rollover, and the next move might be to pour more fuel on the fire. It wouldn’t surprise me in the slightest.”

Einhorn’s broad market thoughts begin at 5:30,

 

And his gold comments begin at 10:30,

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/9Ep9fxC6idE/story01.htm Tyler Durden

We wish we could say we didn’t warn Boeing’s machinists about the key trend taking place in the US economy under the Obama “recovery” but unfortunately we did. Three years ago, to be specific, when we wrote: “Charting America’s Transformation To A Part-Time Worker Society” and followed it up with “A “Quality Assessment” Of US Jobs Reveals The Ugliest Picture Yet” in which we explained that while the propaganda machine was fixated on numeric, quantitative, job additions every month, what has subversively going on, was the constant deterioration in the quality of jobs – and specifically the declining wages – available to those Americans who had not rotated outside of the labor force permanently (currently at a record 91.5 million). We say “alas” because it once again took several years before our cautions to be felt by the broader population, in this case the Boeing machinist union struggling to extract a wage increase from its employer: Boeing Airlines, whose stock keeps hitting new record highs with every passing day.

The machinists’ lament is well-known to virtually everyone who relies on labor instead of capital to exist: pay us more. Bloomberg reports:

“We need to focus on how many jobs there are that give an adult a chance to earn a decent living,” said Gordon Lafer, an associate professor at the University of Oregon’s Labor Education and Research Center in Eugene. “Too much of the discussion has been about the number of jobs, and that’s obviously important, but there’s also a crisis in the quality of jobs.”

That’s ironic: when we said it first three years ago, the mainstream media mocked it. Curious how things change when that hope you once believed in becomes a “zero balance” nightmare at the ATM machine, eh?

Blame it on the Fed, blame it on globalization, blame it on corporations who have a virtually unlimited labor, cheap and global pool to pick from, but the bottom line is US workers have zero leverage.

Where unions and their allies see reason for alarm, employers see a way to retain jobs against the lure of lower wages overseas. There were about 12 million U.S. factory jobs in October, buoyed by recent gains while still down 39 percent from 1979’s peak.

 

“We certainly have seen manufacturers become much more competitive,” said Chad Moutray, chief economist at the Washington-based National Association of Manufacturers. Falling labor costs have helped “keep U.S. manufacturers much more competitive and you’re seeing more investment in the U.S. as a result.”

The good news for workers: each day of pain for them means a day of joy for the shareholders – typically those in US society who already are the wealthiest.

Manufacturers’ after-tax profits rose to a record $289.1 billion last year, more than three times 2009’s tally, the Commerce Department reported. The Standard & Poor’s 500 Industrials Index has more than tripled since its 2009 low, and topped the broader index by 59 percentage points over that span.

 

“What’s being referred to as a recovery in manufacturing is to a large extent a recovery in profitability,” said Dean Baker, co-director of the Center for Economic and Policy Research, a Washington-based group funded by unions and private foundations. “That’s good for the companies and good for the shareholders but it’s not necessarily good for the workers.”

To some, labor’s epic lack of leverage has to do with lack of unionization to take on greedy coroprations.

Some of the states where factory jobs are growing the fastest are among the least unionized. In 2012, 4.6 percent of South Carolina workers were represented by unions, as did 6.8 percent of Texans, according to the U.S. Bureau of Labor Statistics. New York, the most-unionized, was at 24.9 percent.

 

Assembly workers at Boeing’s nonunion plant in North Charleston, South Carolina, earn an average of $17 an hour, compared with $27.65 for the more-experienced Machinists-represented workforce at the company’s wide-body jet plant in Everett, Washington, said Bryan Corliss, a union spokesman.

 

Higher wages also no longer go hand-in-hand with union jobs, as they once did.

But the reality is that in a world drowning in overcapacity, and in which globalization, technological innovation and improvements in productivity mean that Boeing can open a plant anywhere else in the US, or in the world and still pay less than it does currently, even if it means a lot of unhappy, and unemployed labor workers. For example:

General Electric Co. says it has added about 2,500 production jobs since 2010 at its home-appliance plant in Louisville, Kentucky. Under an accord with the union local, new hires make $14 an hour assembling refrigerators and washing machines, compared with a starting wage of about $22 for those who began before 2005. While CEO Jeffrey Immelt has said GE could have sent work on new products to China, it instead invested $1 billion in its appliance business in the U.S. after the agreement was reached.

 

The company is also moving work to lower-wage states. In Fort Edward, New York, GE plans to dismiss about 175 employees earning an average of $29.03 an hour and shift production of electrical capacitors to Clearwater, Florida. Workers there can earn about $12 an hour, according to the United Electrical, Radio and Machine Workers of America, which represents the New York employees.

In summary: here is the corporate speak:

“GE’s business units continuously review their operations and sometimes have to make tough decisions to keep up with market trends, address customer demands or reduce cost,” Duchamp said in an e-mail. “The intention of the proposed move is to address the increasing cost pressures and leverage the resources” available at the Florida site.

And here is the worker speak:

“This is really a symbol of what’s going on in this whole country,” said Machinist Thomas Campbell, 40. “We’re losing middle-class jobs.”

What is sad is that both are correct, and while Bernanke and his wealth effect policies do everything to make the rich, and the corporations, even richer, they continue to rob what little standard of living America’s workers have, and in the process continue to destroy what little is left of the middle class. Once again, as we warned, so long ago.

Tim Geithner was only kidding about “welcome to the recovery” – what he meant was “welcome to the new feudal system.”

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/xnTNsXO9BnY/story01.htm Tyler Durden

Supported by economic weakness overnight in Asia and a weak Philly Fed print (bad news is good news) along with hope from more QE out of the BoJ, JPY weakness floated all boats today as homebuilders and financials surged lifting stocks tick for tick with carry. Yellen's nomination provided yet another lift. Treasuries rallied (though the long-end remains +10bps on the week). Precious metals were monkey-hammered early then dead for the rest of the day (-4% on the week) as oil prices surged higher ( +1.6% on the week). The USD Index glitched lower on no neg rates chatter early from Europe but the quietness in the index hid major dispersion as AUD was craushed (now 1.6% lower on the week). Credit markets rallied (but remain well off stocks) and VIX was compressed as low volumes meant a slow lift higher (and Trannies best day in almost 5 weeks). Shorts suffered the most until POMO ended – tripling market performance.

 

The Dow closed above 16,000 for the first time ever…

 

The S&P managed to get back perfectly to yesterday's highs…

 

The early going was dominated by a smash higher in the most shorted names… again…

 

As homebuilders and financials soared…

 

Credit rallied but has a long way to go to catch up with stocks…

 

Commodities were dispersed with PMs weak and energy/growth strong…

 

As FX markets saw a small down day in the USD Index but major buying relative to JPY, CAD, and AUD…

 

Treasuries rallied modestly after Yellen's nomination…

With USDJPY crossing back over 101, stocks were simply all about the JPY carry trade once again as the promise of Kuroda wins the day…

 

Charts: Bloomberg

 

 

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Submitted by Lance Roberts of STA Wealth Management,

 

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Submitted by Lance Roberts of STA Wealth Management,

 

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