Janet Yellen is Taking Away the Punchbowl… For Now

Many commentators witnessed the first Q&A session with Janet Yellen as a disaster.

 

We don’t see it that way at all.

 

Yellen is widely believed to be a super dove at the Fed. This is largely due to her being a firm advocate for QE in the past few years.

 

However, Yellen is at least intelligent enough to know when the markets are out of control (something neither Bernanke nor Greenspan could do). To whit, Yellen publicly stated that housing was in a bubble in 2005. At the time she suggested deflating it (but was concerned about the deflation being too intense).

 

So, regardless of her various flaws as a forecaster and economist, Yellen has shown herself capable of: 

 

1)   Identify bubbles.

2)   Calling for action for rein them in.

 

With that in mind, Yellen’s decision to continue tapering QE indicates that she is aware of the fact the markets are getting out of control again or are approaching a bubble.

 

This is further confirmed this by her decision to drop the 6.5% unemployment threshold as well as her suggestion that interest rate hikes could come as soon as six months after QE ends this coming December.

 

In simple terms, Yellen is alerting Wall Street that she will not be the second coming of Bernanke (at least for now) and that she is going to be removing the punchbowl.

 

The markets typically take a while to register this. The fact that last week was a quadruple witching options expiration helped hold things together. But now that options expiration is over, we’re running out of reasons for the markets to hold up.

 

Moreover, we’ve recently seen a number of high profile investors (Icahn, Grantham) warn that the markets are overvalued and primed for a sharp drop.

 

Thus we find the following:

 

1)   Yellen is moving to rein in the markets.

2)   Investment legends are warning of a potential drop in asset prices.

3)   Corporate profits falling.

 

This environment is ripe for a market pullback. Smart investors should take this opportunity to prepare for it.

 

For a FREE Special Report on how to protect your portfolio from a sharp downturn, swing by:

 

http://ift.tt/RQfggo

 

Best Regards

Phoenix Capital Research

 


    



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“I grew up castrating hogs on an Iowa farm”: Meet Senate Hopeful Joni Ernst

Via Hot
Air.

“I grew up castrating hogs on an Iowa farm.”

Joni Ernst is one of six Republicans running for a chance to
replace retiring Sen. Tom Harkin (D-Iowa). Writes Hot Air’s
Allahpundit:

Charles Cooke rightly calls it the greatest opening line to
a campaign commercial ever. The last line’s cute too, although the
temptation to say it while holding up a pair of shears must have
been tremendous. That’s the tricky thing about castration humor:
How far is too far? Is a sight gag ever acceptable? Having taken
the plunge by introducing testicles into the discussion, how do you
pull back from total scrotal commitment? These are questions every
savvy political ad team must wrestle with.


More.

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Ebola Virus Outbreak Spreads To Canada

The last few days has seen a sudden jump in the news headlines about one of the deadliest viruses known to man. Ebola haemorrhagic fever has prung up in Guinea, Liberia, and Sierra Leone but now, as BBC reports, a man is in hospital in Canada with symptoms of a haemorrhagic fever resembling the Ebola virus, a health official has said.

“Ebola” is in the news again…

  • *GUINEA CONFIRMS EBOLA AS SOURCE OF EPIDEMIC, AFP REPORTS
  • *LIBERIA SAYS FIVE DIE OF EBOLA IN NORTH OF COUNTRY
  • *TWO SUSPECTED CASES OF EBOLA IN SIERRA LEONE, AFP SAYS

 

 

And that is definitley not a good thing…

 

As The BBC reports, Canada is now the latest nation to have a potential case…

The man had recently returned from Liberia in the west African region, currently suffering a deadly outbreak of an unidentified haemorrhagic fever.

 

He is in isolation in critical condition in Saskatoon, the largest city in Saskatchewan province.

 

 

Dr Denise Werker, the province’s deputy chief medical officer, declined to say how long the man had been in Africa but said he only fell ill after returning to Canada.

 

She said that was in line with the profile of common deadly haemorrhagic fever viruses Lassa fever and Ebola, which have an incubation period of up to 21 days.

 

She said the people most at risk were healthcare workers who do not protect themselves from contact with the patient’s bodily secretions.

 

“There is no risk to the general public,” she said. “We recognise that there is going to be a fair amount of concern and that is why we wanted to go public with this as soon as possible.”

 

A virus resembling Ebola has struck in Guinea, with cases also reported in Liberia.

 

As many as 61 people have died of the disease in the remote forests of southern Guinea.


    



via Zero Hedge http://ift.tt/1jEoas4 Tyler Durden

Reports of Four Loko’s Death Are Greatly Exaggerated. For Now.

You know how you sometimes read obituaries and the primary shock
comes from the fact that the person was still alive? That’s how I
felt when I saw this headline: 


Four Loko Alcoholic Energy Drink to Cease Production: Lisa
Madigan

Turns out that the news site, DNAinfo, or possibly Illinois
Attorney General Lisa Madigan, was confused about the terms of the
alcopop’s latest slide down the greasy pole. Four Loko limps along
after all.

The
settlement
actually allows continued sales of Four Loko, but
limits advertising to college students and underage drinkers,
including a ban on young-looking models in advertisements. Phusion
promises not to suggest that kids mix their product with something
caffeinated either. And the company will pay $400,000 to defray the
cost of the suit.

The decison was forced by a suit from 20 attorneys general.
Let’s pause for a name-and-shame: Thanks Massachusetts, New York,
Arizona, Connecticut, Idaho, Illinois, Indiana, Iowa, Kansas,
Kentucky, Maine, Maryland, Mississippi, New Mexico, North Carolina,
Ohio, Oregon, Pennsylvania, Tennessee, and Washington, plus the
city attorney of San Francisco!

Here’s Phusion Projects President Jim Sloan:

“While our company did not violate any laws and we disagree with
the allegations of the State Attorneys General, we consider this
agreement a practical way to move forward and an opportunity to
highlight our continued commitment to ensuring that our products
are consumed safely and responsibly only by adults 21 and
over.”

Four Loko hasn’t actually been caffeinated since 2010, something
Sloan must be damned tired of pointing out by now. It’s just a can
of not
especially high-proof sugary booze
, and has been for a good
while.

Want to feel especially sad? Here the last pathetic little bit
of fight that’s left in the company’s president:

“Phusion continues to believe, however, as do many people
throughout the world, that the combination of alcohol and caffeine
can be consumed safely and responsibly,” Sloan said.

In honor of this obviously true statement, the next time you
stir up an Irish coffee or sip a rum and Coke on a warm night, go
ahead and pour one out for the homies. Four Loko might not be dead
yet, but it’s hard to imagine meddlesome officials will leave this
particular horse alone until it’s well and truly beaten. 

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The Three Stooges Debunk myRA

Submitted by Dennis Miller via Casey Research,

A little skit ran through my head the other day…

The house lights dimmed and the bright American flag glistened in the background. The crowd hushed as a tall man in a strange costume strode confidently onto the stage. 

Curly turned to Larry and Moe and exclaimed, "Oh my, that's our favorite—Uncle Sam, our boyhood hero." Moe put his finger to his lips as if to say "Shhh!"

Uncle Sam rapped the microphone with his fingernail and the sound echoed throughout the hall. He then bellowed out, "Hello, my fellow Americans!" and the crowd cheered wildly.

He continued, "Today I want to announce the deal of a lifetime. We all know that IRAs and 401(k)s are tools greedy rich people use to save for retirement. I'm here to announce a new retirement program for everyday, ordinary people. Everyone should have the right to retire safely and with dignity, and that is what we are going to do for you."

Uncle Sam paused until the applause died down.

"Today we have introduced a new retirement program called myRA. It's pretty simple. Your employer can withdraw as little as $5 from your paycheck, and it will be invested in a new government bond that will earn the same variable-rate interest as those available through the government Thrift Saving Plan Government Securities Investment Fund (G fund). If you change jobs, it is totally portable. You can take it with you.

"While the final details are still being worked out, you can invest your money into safe, interest-bearing bonds and let it grow tax free. And the best part is: when you take your distribution out, you don't have to pay taxes on it either. 

"So, there you have it! You can have money taken out of your paycheck in small amounts. It will be invested in variable-interest government bonds paying a good return, and it will be there for your retirement along with Social Security, TAX FREE! Don't ever say Uncle Sam isn't looking out for you. 

"I know everyone is anxious to get started, but I will answer some questions now. Please raise your hand."

Curly raised his hand and Uncle Sam pointed in his direction. "You, baldy, what's your question?"

Curly cleared his throat and asked, "It looks to me like the government is acting like an insurance company. We give you our money and you look after it for our retirement. Is that correct?" 

"Exactly right," Uncle Sam responded. "Who else can keep money as safe as the US government?"

Curly, Larry, and Moe looked at each other quizzically. 

Moe raised his hand. Uncle Sam spotted him and said, "You, mop head, what is your question?"

Moe said, "The national debt clock shows the government already has over $128 trillion in unfunded promises to others. How will our money be invested? Will it be used to make good on promises already made to other people?"

Uncle Sam paused for a moment and said, "Those details will be worked out. While that may happen, younger people will take part in this program too, so they will help pay for your retirement when the time comes."

Moe could barely contain himself. "Isn't that a Ponzi scheme? I thought they were illegal?"

Uncle Sam paused and said, "Ponzi schemes are illegal, unless they are run by the government. What's your problem? I mean, come on! Doesn't everyone trust the government?"

51% of the audience cheered wildly while the other 49% remained silent.

Larry, not wanting to be outdone by his friends, raised his hand.

"You, half-bald mop-head, what's on your mind?"

Larry replied, "I have a two-part question. Why not use a Roth IRA instead? Aren't they available to everyone? Also, can't all self-directed retirement plans invest in government bonds now if they want to?"

Uncle Sam's face grew red as he responded, "Obviously, you don't get it. Nothing is safer than a retirement program totally invested with the government. You earn a decent yield without any worry."

Larry shouted, "Wait a minute! The government has already made over $128 trillion in promises it cannot keep. Now you want us to invest our money with you, at an interest rate that you control? What's the catch?"

Uncle Sam's face grew bright red as he exclaimed, "Everyone knows the government can do a better job of looking after your money than you can. You guys are just a bunch of stooges. This program is so good, but you dummies are too stupid to see that!"

Curly turned to Larry and Moe and said, "When Uncle Sam calls it an myRA he is right. 'My' means it is his. We may be dumb, but we are not that stupid. This is a terrible idea. They are just trying to grab our money so they can keep buying votes in the next election. I am not touching it."

"I heard that!" Uncle Sam screamed. "You are the kind of people who have torn America apart—greedy, selfish, and without compassion for the little guy. Audience, you heard them. Don't you agree?"

51% jumped to their feet screaming wildly while the other 49% sat silent. Once the noise died down, Larry uttered through the microphone, "It sounds to me like another money grab. We might be better off just leaving the country."

Uncle Sam realized this was an argument he had to win. "Look, you un-American radicals! We don't want your kind in this country. Those values have no place in a modern society. Go ahead! Get the hell out of here! Just leave your money behind. Audience, don't you agree it is time to tell those greedy buggers to hit the road? If they don't want to share, let them go elsewhere. I am sick of their selfish ways."

Again, 51% jumped to their feet screaming wildly, glaring at Larry, Curly, and Moe. The screaming would not stop. 49% quietly headed to the exits with the three stooges leading the way. Moe, speaking in almost a whisper, commented, "It seems the real stooges are the ones who fall for the scheme." The 49% nodded their heads in silent agreement.

Personally, I am a registered independent and have been for over 50 years. Both political parties have pushed the government to make $128 trillion worth of promises—with our money—that it cannot afford to pay. What a terrible burden to place on future generations!

Our national debt clock shows government liabilities of $1.1 million per taxpayer. They spend our money to buy votes to stay in power. The system is beyond repair.

Humor is a good outlet to help work through issues that might otherwise drive my blood pressure—and yours—to an all-time high. Here's the scary part we cannot laugh away: myRAs are real.

My advice: Just say no to myRA and open up a Roth IRA instead. You receive the same tax benefits but more options to invest your money ahead of inflation so you can actually enjoy retirement. Snake oil is snake oil, no matter how you try to package it.

As a person who has spent the last several years trying to help people understand investing so they may retire comfortably, I become more frustrated with the government every day. No one needs a myRA when they can invest in a Roth IRA with the same benefits but greater flexibility.

There are many ways for folks to save for retirement without turning to the government. After all, most realize it isn’t prudent to seek financial help from the most broke person (or entity, in this case) around. My weekly column, Miller’s Money Weekly, offers insights into alternative ways to protect and build your nest egg. Best of all, it’s free. Sign up today to receive articles like the one you just read and other actionable advice.


    



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Tell Us: What’s Libertarian About Your Favorite Video Games?

"Final Fantasy XII," where you had to buy licenses just to wear clothes, is completely disqualified from this debate.June’s issue of Reason
magazine will be exploring the most popular recreational pastime in
America (and several other countries as well) – video games! Many
Gen-Xers have grown up with video games, and video games have grown
up alongside of them to become a cultural and marketplace
juggernaut. In “Video Game Nation” we’ll be analyzing what it all
means, looking at how self-described gamers describe their
political leanings, tracking games’ growth as a form of expression,
documenting the moral panics surrounding games in the days of yore,
exploring what we can learn about economics from games, and
interviewing a game-loving congressman who rallied his community to
fight some bad Internet-related legislation. We’re planning several
game-related videos as well.

We know there plenty of gamers among the Reason crowd, so we
want to incorporate your experiences with games if we can. Are
there games that you love that you find particularly libertarian?
What makes them so libertarian? Sound off in the comments, and
we’ll pick some cogent or interesting choices to go along with our
package. You can go back as far as you like in game history. If you
want to make the case that Q-Bert argues for looser
borders and freer immigration policies, more power to you. Think
outside the box, or the pyramid of boxes, as the case may be.

If you need to refresh your memory, check out Peter Suderman’s
2013
list of video games all libertarians should play
. What would
you add?

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Anthony “@Hedgieguy” Davian Pleads Guilty To Fraud

Last August we presented the story of a very sad and misguided individual, one Athony Davian, who was then the first person charged with running a ponzi scheme off twitter. Specifically, we said:

Once upon a time there was a Twitter-based, pump-and-dumping daytrading bucket shop posing as a “successful hedge fund manager” also known as Davian Letter/Davian Capital Advisors run by an Ohio gentleman known as Anthony Davian, which for reasons unknown even managed to run outside capital (somehow raking up to $1.5 million in idiot AUM, mostly courtesy of his very aggressive self promotion on Twitter using the @hedgieguy handle), and which didn’t like Zero Hedge much.

(but that’s ok because the feeling was mutual – we had advised the SEC in late 2009 that the Davian operation was nothing but a ponzi scheme).

 

A few years later, said outside capital is gone (with losses that could have been prevented had the SEC moved earlier) and moments ago, following a four year delay since our notice, the SEC has finally acted and charged Anthony Davian with fraud.

Today, the sad story of Anthony “@Hedgieguy” Davian…

… comes to an end with his guilty plea to charges of fraud.

From Cleveland.com:

A Copley man today pleaded guilty to charges he operated a fraudulent investment scheme that caused his investors to lose about $1.8 million.

 

Anthony Davian, 34, was charged with 14 counts of securities fraud, mail fraud, wire fraud, and money laundering. He is scheduled to be sentenced July 2.

 

“This defendant deceived clients to line his own pockets,” said U.S. Attorney Steven Dettelbach. “We will continue to aggressively pursue cases in which investors are cheated out of their savings.”

 

Davian grew up in Parma and graduated from Holy Name High School in 1998. He attended the University of Akron but did not

graduate.

 

According to charging documents, from 2008 to 2013, Davian used his hedge fund, Davian Capital Advisers, LLC, to promote and sell securities to at least 20 investors across several states, resulting in $1.8 million in overall investor loss.

 

Davian purported to sell securities in the form of shares in the various funds he created and controlled, including Davian Capital, Rubber City Gravity, Rubber City Pure Alpha, Cleveland Precious Metals Fund, and others. 

 

Instead, he used the investors’ monies to pay back earlier investors, to enrich himself, and to pay off personal expenses, such as the purchase of an Audi Q7 Prestige, and the construction of a luxury home, according to the information.

 

The investigation revealed that Davian cajoled investors’ into giving him hundreds of thousands of dollars by claiming to manage hundreds of millions of dollars to make himself appear more sophisticated than he really was, and by falsifying client account statements, according to the information.

 

Last year, the Securities and Exchange Commission charged Davian and his Richfield-based hedge fund company with defrauding investors. The agency’s complaint characterized Davian Capital as “nothing more than Davian’s personal piggy bank,” and called Davian’s promise of returns on investments “figments of Davian’s imagination.”

One down. Many more to come.


    



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VIX Slam Fails But Blue Chips Pop As High-Beta Drops

Pre-open gold dump, USDJPY pump, check. Opening dump in USDJPY and stocks led by Momos and Biotechs, check. European close marks the bottom, check. EURJPY takes over and ramps stocks back up to highs, check. Fade into close, check. Today was an almost perfect echo of yesterday's market action with blue-chips benefitting from the weakness in Nasdaq and Russell high-beta honeys. Bonds were quite with very modest steepening. Gold and silver bounced off earlier lows but their losses mirror Copper's 1.7% rise on the week. The USD lost ground as Draghi's failed jawboning sparked EUR strength. VIX fell 1 vol to its lowest close in 2 weeks as a late-day VIX -slam failed to get SPX green post-FOMC.

 

EURJPY running the show into and beyond the European close – just like yesterday…

 

The Dow and Trannies are 'winning' on the week, S&P around unch, but high-beta leaders are lagging notably…

 

Whle the Dow remains red YTD, the S&P almost made it almost down to unch YTD again today. However, Post-FOMC, The Dow is leading…

 

Post-FOMC, homebuilders remain the laggards and financials (ahead of the CCAR) the leaders…(for now)…

 

Momos remain in trouble post-FOMC…

 

And Biotechs didn't exactly bounce strongly off their 100DMA again today…

 

VIX and stocks were in sync all day but a very late try to slam VIX appeared to fail…

 

and a close up on the idiocy at the close…it seems 330RAMP CAPITAL is running out of power?

 

Copper regained (and then lost $300) in this morning's ramp and lcung to it all day. Gold and silver are losing on the week…

 

FX markets continue to play their calm-to-chaos game (though yesterday's spike in EUR is still a mystery) – todasy saw a drop in EUR as Draghi started then a big surge in EUR as the market continues to pressure him to do something instead of keep practicing open-mouth operations…

 

Treasuries are a mixed bag in a tight range today. 10Y and 2Y are unch on the week as 5s and 7s are higher and 30s lower in yield (though today saw modest steepening)…

 

Charts: Bloomberg

Bonus Chart: Today's miss on home sales just adds more problems for builders who have been underperforming post FOMC – but as @Not_Jim_Cramer notes, they have a long way to go if the data surprises are anything like reality…

 

Bonus Bonus Chart: PLUG +56% – that is all…


    



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Jim Epstein on the Government’s Appalling Campaign Against Small Bus Companies

Jeff and Judy Rodgers, owners of Southeastern Tours, around 1994. |||

Eight months ago, Jeff and Judy Rodgers of Greenville, North
Carolina ran a thriving charter bus company called Southeastern
Tours with seven motor coaches and annual revenues of about a
million dollars. 

Today the company is on the verge of bankruptcy. The Rodgers
have returned six of their seven buses, and they may lose their
home of 22 years, which served as collateral on a business
loan.

Southeastern Tours is a victim of the government’s new
tough-on-crime approach to regulating the bus industry, which, as
Reason TV’s Jim Epstein explains, is forcing carriers with
impeccable safety records off the road and then denying owners
their constitutional rights to due process.

View this article.

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Obama Brushes Off Idea of Russia as Threat, US Accepts Ruling on No-Fly List Problems, IRS Classifies Bitcoins as Property: P.M. Links

  • Will the IRS accept payments in bitcoins?President Barack Obama,
    speaking in the Netherlands, brushed off the idea that Russia is
    America’s top geopolitical foe and called Moscow a “regional
    power
    .”
  • The United States will not appeal a court’s ruling that it
    failed to appropriately offer due process when it incorrectly added
    Malaysian architect Rahinah Ibraham to the
    no-fly list over mistaken suspicion of terrorist ties
    .
  • A Florida prosecutor officially said today that an FBI agent
    was justified in
    fatally shooting Ibragim Todashev
    during an interview last
    year. According to the report, the alleged friend of deceased
    Boston Marathon bomber Tamerlan Tsarnaev threw a coffee table at an
    agent and attacked him with a pole after admitting involvement with
    a triple homicide in Massachusetts. The Department of Justice also
    cleared the agent.
  • Terrible bureaucratic behavior from a charter school, but
    apparently resolved quickly. Kamryn Remfro, 9,
    shaved her head
    in support of a friend battling cancer. This
    was ruled to be a violation of Caprock Academy’s dress code in
    Colorado. The school booted her, but then quickly changed its mind
    and let her back today. School officials are holding a meeting to
    review the incident.
  • The IRS is
    classifying bitcoins as property
    and “tax principles applicable
    to property transactions apply to transactions using virtual
    currency.” Virtual currency is also subject to the appropriate
    taxes when used to pay employees or contractors.
  • The United Nations human rights commissioner has condemned the
    mass death sentences
    handed down to 528 Muslim Brotherhood
    members in Egypt as a breach of international human rights
    laws.

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and Twitter,
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content.

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