Tag: news

Via The Onion,

This week saw the first confirmed case of Ebola virus within the United States, the latest development in an outbreak that has already claimed over 3,000 lives.

Here are some ways you can protect yourself against this deadly disease:

Boil all bodily fluids before consumption.

 

Regularly examine your DNA under an electron microscope for any indication that Ebola has attached itself to your cell membranes.

 

Recognize the symptoms of Ebola, which include fever, chills, and developing symptoms too late to do anything about them.

 

Cover the nose and mouth of Ebola patients when they sneeze to avoid spreading germs.

 

Avoid eating bat soup, which is actually pretty sound advice whether there’s an ongoing Ebola outbreak or not.

 

Ebola can only be spread once patients are symptomatic, so if you believe you’ve been exposed, get all your errands and public trips out of the way before your symptoms start showing.

 

Be sure to stay up to date on developments by signing up for the official CDC phone tree.

 

Try being born one of the 15 percent of rural Gabonese citizens with natural immunity to the virus.

 

Give billions of dollars to pharmaceutical companies.

 

If you see a suspicious-looking filamentous virus particle roughly one micron in length, stay away.

 

Continue following lifelong plan of avoiding Dallas, TX at all costs.

* * *

Humor? Maybe. But is it any less odd than the government’s approach – “Don’t worry about it”

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

Just my take on the whole Ebola situation which is unfolding at a rapid speed. As we are all well aware by now, Ebola is rapidly spreading across West Africa, and has made it to shore here in the U.S. Government officials are coming out in droves to tell citizens that the situation is under control and contained. They claim that Ebola does not spread easily like the flu or a cold, and that you can only contract the virus from exposure to bodily fluids. Not a doctor here, but if that was the case, please explain why the current death toll has now surpassed 3,400 according to the World Health Organization. Meanwhile, the U.S. government has ordered 160K HazMat suits. Not trying to instil fear with this post, but maybe this is far more serious than our government officials are claiming it to be. 

 

 

 

WH stages Friday afternoon press briefing to calm fears of Ebola outbreak in the US. http://ift.tt/1yCTa7g

— Mark Knoller (@markknoller) October 3, 2014

via Zero Hedge http://ift.tt/1vmhR1V StalingradandPoorski

Submitted by Lance Roberts of STA Wealth Management,

It has been an interesting week in the financial markets as the current correction process has continued. As shown in the chart below, the correction has primarily occurred in the mid, small and international equities as money has rotated into mega-large cap stocks for safety.

 

(The chart above shows each index on a performance basis relative to the S&P 500 since mid-August.)

The chart above suggests a couple of things:

1) Portfolios that have been allocated outside of a large cap domestic stocks have performed substantially worse than market headlines would suggest, and;

2) The leadership of the market has narrowed markedly in recent months which historically has been an indicator of late stage "bull-market" cycles.

The current correction in the S&P 500 has taken the index into very oversold territory on a short-term basis as shown below.  (As an aside, I do find it somewhat humorous to see the "panic" of individuals over a 3.4% dip. When a real correction occurs the "stampede for the exits" could be far greater than currently imagined.)

 

This short-term oversold condition should fuel a bounce off of the long-term support that has been in play since late 2012. Such a bounce will give investors an opportunity to rebalance portfolios while we wait for confirmation of a continuation of the "bull" rally. The failure of the market to attain new highs will suggest that a potential trend change has begun, and further correctionary action lays ahead. As discussed yesterday, it is "portfolio management" that creates long-term investment success by avoiding periods of capital destruction.

With that said, this weekend's reading list, as the title implies, is varied collection of observations to exercise your "grey matter." I have also linked opposing points of view to balance opinions.  Enjoy.

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1) Warning Flags In The Stock Market by A. Gary Shilling via Bloomberg

"Their enthusiasm waned in mid-January because of emerging-market woes, but soon returned, taking major indexes to all-time highs. Nevertheless, a number of warning flags are flying today. Among them:"

• High P/E Ratios
• Slow Economic and Corporate Revenue Growth
• Earnings Dependent on Profit Margins
• Fed Tapering

Read Also: Markets' Rational Complacency by Nouriel Roubini via Project Syndicate

2) Market Valuation Overview by Doug Short via Advisor Perspectives

"As I've frequently pointed out, these indicators aren't useful as short-term signals of market direction. Periods of over- and under-valuation can last for many years. But they can play a role in framing longer-term expectations of investment returns. At present market overvaluation continues to suggest a cautious long-term outlook and guarded expectations. However, at today's low annualized inflation rate and the extremely poor return on fixed income investments (Treasuries, CDs, etc.) the appeal of equities, despite overvaluation risk, is not surprising."

Read Also: Valuation Myths by Jeffrey Saut via Advisor Perspectives

But Also Read: Shiller's CAPE – Is There A Better Measure by Streettalklive.com

 

3) The Middle Class Is Poorer Today Than In 1989 by Matt O'Brian via WP Wonkblog

"The economy has gotten bigger, but much of that growth hasn't reached the middle class. Indeed, the top 1 percent grabbed 95 percent of all the gains during the recovery's first three years. And that's not even the most depressing part. Even adjusted for household size, real median incomes haven't increased at all since 1999. That's right: the middle class hasn't gotten a raise in 15 years."

Read Also: IMF Warns Of Mediocre Growth For Years via Reuters / DW

For More Study On The Middle Class Condition Read: For 90% Of Americans There Has Been No Recovery by Streettalklive.com

 

4) Peak Housing by Mark Hanson

"The take-away from last month’s housing data was that 'the market was returning to normal', which despite the persevering weakness, was viewed as a 'great thing'. This overly-simplistic and flawed assumption was made, as the all-cash cohort demand dramatically cooled and distressed supply and sales plunged YoY.

What people are suffering from is a lack of a medium-term memory, as what’s happening today happened in 2007/08; 'Peak Housing.'"

 

5) When Bad News Becomes Bad News by Albert Edwards vis ZeroHedge

"There were two key parts to our Ice Age thesis. First, that the West would drift ever closer to outright deflation, following Japan?s template a decade earlier. And second, financial markets would adjust in the same way as in Japan. Government bonds would re-rate in absolute and relative terms compared to equities, which would also de-rate in absolute terms. This would take many economic cycles to play out. Previous US equity valuation bear markets have taken 4-6 recessions to complete ? we?ve only had two thus far.

 

Another associated element of the Ice Age we also saw in Japan is that with each cyclical upturn, equity investors have assumed with child-like innocence, that central banks have somehow ?fixed? the problem and we were back in a self-sustaining recovery. Those hopes would only be crushed as the next cyclical downturn took inflation, bond yields and equity valuations to new destructive lows. In the Ice Age, hope is the biggest enemy."

Read Also: Are We In A Permanent Liquidity Trap? by Cullen Roche via Pragmatic Capitalist

But Also Read: What Is A Liquidity Trap? by Streettalklive.com

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"October: This is one of the particularly dangerous months to invest in stocks. Other dangerous months are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Have a great weekend.

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

Despite President Obama’s assurances that the chances of Ebola spreading to America were very small (against experts’ opinion that it was about a 20% probability), “it” is here; and so we look forward to hearing from The White House top experts on how well “contained” it is (despite 100 under surveillance and another case in Hawaii and in Washington) and why there’s no need for widespread panic.. at least not until the entire Government’s 160,000 HazMat suit order is filled…

As NY Times reports,

Under mounting pressure over their handling of the Ebola crisis, White House officials are planning a Friday afternoon briefing to outline how the government is responding to the epidemic.

 

The 3:30 p.m. briefing will feature administration officials including:

• Lisa Monaco, assistant to the president for homeland security and counterterrorism;
• Sylvia Mathews Burwell, secretary of health and human services; and
• Dr. Anthony S. Fauci, director of the National Institute of Allergy and Infectious Diseases at the National Institutes of Health.

Press Conference is due to start at 1630ET…

via Zero Hedge http://ift.tt/1vm35Z8 Tyler Durden

Despite a low-volume melt-up in stocks off yesterday's European close lows, US equities closed lower on the week with small caps once again the laggards. Even as stocks closed red, the costs of protection in credit and equity markets tumbled as the last 2 days volumeless liftathon in stocks took place against the background of very modest Treasury selling – this has the stench of high-yield bond exposure being significantyly reduced (and synthetic hedges being lifted) – something we saw Wednesday into the close. The USDollar rose the most in 15 months today (up for the 12th week in a row – longest streak since Bretton Woods) led by Cable and EUR weakness. Jobs data losses in bonds today were largely reversed with TSY yields ending the week dopwn 7-9bps. Commodities were ugly with silver and oil (under $90) joined at the hip and gold closing below $1200 for first time this year. The Russell 2000 closed lower for the 5th week in a row, the worst streak since Aug 2011.

 

Spot The Ramp Day (by looking only at the lower pane's relative volume chart)

 

Trannies scarmbled back to green on the week but the rest closed red with Russell lagging… Dow's first 200pt gain since March 4th…

 

Despite an epic surge off yesterday's European close lows…

 

Just looking across the corporate bond-equity-vol complex, we see notable Treasury buying, and protection (HY and VIX) unwinds in the last 2 days which are exactly the paradoxical moves we would expect from a major liquidation of high-yield credit exposure in a fund… of course this is interpreted by the machines as bullish (VIX/HY) and stock indices are lifted (on no 'real' volume) but in fact it is anything but as the reality of the cash market unwinds spreads to the primary issuance and finally stock markets…

 

and close up today..

 

VIX definitely saw more selling (unwind hedge) exposure than mere stocks alone would have expected…

 

The USD index rose 1.25% today…led by EUR and GBP weakness

 

The most in 15 months..

 

Silver and Oil (back under $90) moved in lockstep once again with various flushes on the week but all commodities closed lower against the strong USD..

 

Gold closed below $1200 for the first time this year…

 

Treasury yields closed the week 7-9bps lower (reversing most of today's jobs reaction losses)

 

Charts:Bloomberg

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

The drip-drip-drip of Fed-induced inflation is hardly felt by most Americans even on an annual basis; but take a step back over a generation of currency debasement and it becomes clear. As the following image shows, the cost of living since 1938 has, simply put, exploded. With incomes up just 30x in those 76 years, the cost of a home has risen 70x, the cost of bacon has risen 100x, and the biggest of all, the cost of a Harvard education has risen 142x. Insidious… "the road to poverty is paved with small inflations."

 

 

h/t @History_Pics

*  *  *

Mises Economic blog provides some more color on where America is heading… The Road To Poverty Is Paved With Small Inflations…

The value of Venezuela’s currency plummeted to record lows on the black market last week, with 100 ‘strong’ bolivars exchanging for $1 (ten times lower than the official rate), and annual price inflation reaching 63%. Chavez’s successor Nicolas Maduro, continuing to denounce the “capitalist economic war” on his socialist regime, now blames airlines for trying to collect ticket revenues the government isn’t able to pay. Meanwhile, the Venezuelan economy is showing symptoms of a rapidly forming crack-up boom: shortage of basic amenities, power outages, depletion of dollar reserves by 30%, and looming debt default. As people scramble to exchange paper money for anything and everything that can still be found on store shelves, “over there”—say their Columbian neighbors just across the border—“there’s no food.”

The ‘final and total catastrophe of the currency system’—as Mises called the terminus point of any sustained inflation—was in fact brewing in Venezuela long before Maduro’s regime, and the country experienced even higher price inflation in late 1990s. But because people held the belief that prices might fall at some point in the future, and continued to increase or maintain their cash balances, the earlier stages of the inflationary process were drawn out over many years. However, two Caracas entrepreneurs have warned that it is now too late for the government to salvage anything: “people clearly haven’t had confidence in [the bolivar] for decades; and even less now… It doesn’t look like the market has much confidence in the government’s ability to get things under control”.

While Maduro’s regime is leading its people to poverty in a quick, conspicuous manner, other governments are more willing to wait and conceal their intentions. Moderate price inflation has been simmering for decades in Western economies, where central banks make it their official mission to keep prices increasing at an annual rate of 2%—which means doubling them over the course of 30 years. Beneath this goal of ‘price stability’, central banks’ balance sheets quadrupled by 2012 and brought about a global financial crisis. However, this produced no rampant commodity price inflation, and no flight into real goods is likely to happen in the foreseeable future.

But does that really mean that we’re a world away from Venezuelan-like problems? As Mises pointed out, not necessarily:

If you talk about a catastrophe of the money, you need not always have in mind a total breakdown of the currency system… [Price] changes are not the same, nor [do they occur] to the same degree in various countries. But one should not exaggerate the difference in the effects brought about by the greater inflations as against the smaller inflations. The effects of the “smaller inflations” are also bad. […] If the government destroys the money, it not only destroys something of extreme importance for the system, the savings people have set aside to invest and to take care of themselves in some emergency; it also destroys the very system itself. Monetary policy is the center of economic policy (Mises 2010, 31-2)

 

[W]hat we have to realize, what we have to know when we are dealing with money and monetary problems, is always the same… the increase in the quantity of money, the increase of those things which have the power to be used for monetary purposes, must be restricted at every point (Mises 2010, 24)

Great or small, inflation hurts the masses, leading to the destruction of savings, as well as unemployment and overall impoverishment, while concentrating wealth in the hands of elites privileged by their position in the monetary hierarchy. If inflation doesn’t stop, the breakdown of the monetary system—whether fast or slow—will also bring about the destruction of the social division of labor. From this point of view, the difference between inflation ‘over here’ and inflation ‘over there’ is only a matter of how quickly we become poor.

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