If You Think The Employment Numbers Are Good, Then You Really Need To Read This Article By Michael Snyder, on August 3, 2013

Do you actually believe that the employment numbers are getting better?  Do you actually believe that there is a bright future ahead for American workers?  If so, then you really need to read this article.  The truth is that we are in the midst of the worst employment crisis since the Great Depression, and there has been absolutely no employment recovery.  In fact, the percentage of working age Americans that are employed is just about exactly where it was during the darkest days of the last recession.  But the mainstream media is not telling you this.  The mainstream media is instead focusing on the fact that the official "unemployment rate" declined from 7.6% in June to 7.4% in July.  That sounds like great news, but when you take a deeper look at the employment numbers some very disturbing trends emerge. (Read More....)

Over the past several years, almost the entire decline in the unemployment rate can be accounted for by people "leaving the workforce".  The "unemployment rate" has not been going down because people are actually getting jobs.  Rather, the "unemployment rate" has been going down because the government has been pretending that millions upon millions of American workers simply do not want jobs anymore.  This is extremely misleading.

We are being told that 162,000 jobs were created in July.  Okay, so that is just barely enough to keep up with population growth, and most of the jobs that were created last month were part-time jobs.

Meanwhile, the jobs numbers for the two previous months were both revised down...

The change in total nonfarm payroll employment for May was revised from +195,000 to +176,000, and the change for June was revised from +195,000 to +188,000. With these revisions, employment gains in May and June combined were 26,000 less than previously reported.

Will this month eventually be revised down too?

When it comes to measuring employment in the United States, I believe that a much more accurate measurement than the highly manipulated "unemployment rate" is the civilian employment-population ratio.  This ratio tells us what percentage of working age Americans actually have a job.

Just prior to the last recession, about 63 percent of all working age Americans had a job.  During the recession, that number plunged dramatically and ultimately fell below 59 percent, and it has stayed below 59 percent for 47 months in a row...

This is the first time in the post-World War II era that the employment-population ratio has not bounced back after a recession.

So there has not been an employment recovery.  Anyone that tells you that there has been an employment recovery is lying to you.

Since the end of 2009, we have been treading water at best.  But during that time, another disturbing trend has emerged.  Good paying full-time jobs are rapidly being replaced by low paying part-time jobs.

And this trend has definitely accelerated this year.  If you can believe it, an astounding 76.7 percent of the jobs that have been "created" in 2013 have been part-time jobs.

As I wrote about last month, the employment landscape in this country is fundamentally changing.  At this point, the number one employer in this country is Wal-Mart, and the number two employer in this country is a temp agency (Kelly Services).

This is a huge reason why the middle class is dying.  You simply can't raise a family on a part-time income.

Our young adults are being hit particularly hard.  According to Gallup, the percentage of working age Americans under the age of 30 with a job fell from 47.0% in June 2012 to 43.6% in June 2013...

Fewer Americans aged 18 to 29 worked full time for an employer in June 2013 (43.6%) than did so in June 2012 (47.0%), according to Gallup's Payroll to Population employment rate. The P2P rate for young adults is also down from 45.8% in June 2011 and 46.3% in June 2010.

When our young people get out of school and enter the real world, they are finding that "good jobs" are few and far between.  But unless our young people can find "breadwinner jobs", they are not going to be able to get married, buy homes and raise families.

A lot of young people are doing their best, but things are really tough out there right now.  The lack of good jobs is the primary reason why families that have a head of household under the age of 30 have a poverty rate of 37 percent.

A lot of young adults are coping with this employment crisis by moving back in with their parents.  According to one recent study, 36 percent of all young adults in the 18 to 31 age bracket are currently living with their folks.

Are you starting to understand that our system is broken?

The quality of jobs in this country continues to steadily decline.  Just consider the following numbers from one of my previous articles...

-The number of part-time workers in the United States has just hit a brand new all-time high, but the number of full-time workers is still nearly 6 million below the old record that was set back in 2007.

-In America today, only 47 percent of adults have a full-time job.

-At this point, one out of every four American workers has a job that pays $10 an hour or less.

-An astounding 53 percent of all American workers make less than $30,000 a year.

And as I mentioned yesterday, until we have a jobs recovery there will be no housing recovery no matter how much the Federal Reserve tries to manipulate the system.

The mainstream media continues to insist that "things are looking up" for the housing market, and yet the home ownership rate in the United States is the lowest that it has been in 18 years.

In order for the middle class to thrive, people have got to be able to get good jobs and people have got to be able to buy homes.

Instead, the percentage of good jobs in our economy continues to shrink, the level of home ownership continues to decline, and less than half of all Americans now consider themselves to be middle class.

The next wave of the economic crisis has not even hit us yet, but we continue to see poverty rates soar all over the nation.  In fact, just this week there was an article about the tent cities that are starting to pop up all over New Jersey...

Tent cities have popped up across New Jersey including the state's poorest city.

Meg Baker chased the story of Camden's tent city.  Residing off Route 38 at Wilson Boulevard under an overpass, through woods and down a path of trash lays a community of people living in tents.  This particular community was relocated from Federal Street and it's inhabited by an array of people: addicts, people who have fallen on hard times and some with mental illness.

Baker took a tour of this run down community and the pictures show just how heart-wrenching this situation really is.  Among the homes are decomposing food, broken furniture, and feral cats.

This is supposed to be "the economic recovery".

If things were going to get "better" it should have happened by now.

But things didn't get better, and now the next wave of the economic crisis is rapidly approaching.

As I tried to explain the other day, the most important number in our economy is the yield on 10 year U.S. Treasuries.  As that number goes up, interest rates all over our economic system go up.  And much higher interest rates would be absolutely devastating for our economy.

Unfortunately, many analysts now believe that interest rates are going to go much, much higher than they are right now.  Just check out this excerpt from a recent CNBC article...

The Federal Reserve will lose control of interest rates as the "great rotation" out of bonds into equities takes off in full force, according to one market watcher, who sees U.S. 10-year Treasury yields hitting 5-6 percent in the next 18-24 months.

"It is our opinion that interest rates have begun their assent, that the Fed will eventually lose control of interest rates. The yield curve will first steepen and then will shift, moving rates significantly higher," said Mike Crofton, President and CEO, Philadelphia Trust Company told CNBC on Wednesday.

If interest rates do go that high, our economy simply will not be able to handle that.  It would cripple the finances of state and local governments all over the nation, it would absolutely crush the housing market, and it would cause a derivatives crisis unlike anything that we have ever seen before.

The smart money knows that rising interest rates spell big trouble and they are already pulling their money out of the market as a Bloomberg article recently detailed...

Private-equity managers from Fortress Investment Group LLC (FIG) to Blackstone Group LP (BX), which made billions by buying low and selling high, say now is the time to exit investments as stocks rally and interest rates start to rise.

And Apollo Global Management LLC Chief Executive Officer Leon Black said the following back in April...

"It’s almost biblical: there is a time to reap and there’s a time to sow," Apollo (APO)’s Black said at a conference in April. "We think it’s a fabulous environment to be selling. We’re selling everything that’s not nailed down in our portfolio."

The smart money is getting out while the getting is good.

They know that a storm is coming.

They know what higher interest rates will do to the economy.

As bad as the employment picture is right now, this is NOTHING compared to what is coming.

This is about as good as things are going to get.  It is all downhill from here.

So enjoy this false bubble of pseudo-prosperity while you still can.

When the next great wave of the economic crisis strikes, millions upon millions of Americans are going to lose their jobs and the official unemployment rate is going to soar well up into the double digits.

Why Another Great Real Estate Crash Is Coming By Michael Snyder, on August 1st, 2013

There are very few segments of the U.S. economy that are more heavily affected by interest rates than the real estate market is.  When mortgage rates reached all-time low levels late last year, it fueled a little "mini-bubble" in housing which was greatly celebrated by the mainstream media.  Unfortunately, the tide is now turning.  Interest rates are starting to move up steadily, even though the Federal Reserve has been trying very hard to keep that from happening.  A few weeks ago, when Federal Reserve Chairman Ben Bernanke suggested that the Fed may start to "taper" the rate of quantitative easing eventually, the bond market had a conniption and the yield on 10 year U.S. Treasuries shot up dramatically.  In an attempt to calm the market, the Fed stopped all talk of a "taper" and that helped settle things down for a brief period of time.  But now the yield on 10 year U.S. Treasuries is starting to rise aggressively again.  Today it closed at 2.71 percent, and many analysts believe that it will go much higher.  This is important for the housing market, because mortgage rates tend to follow the yield on 10 year U.S. Treasuries.  And if mortgage rates keep rising like this, another great real estate crash is inevitable. (Read More....) This wasn't supposed to happen.  Federal Reserve Chairman Ben Bernanke said that he could use quantitative easing to control long-term interest rates.  He assured us that he could force mortgage rates down for an extended period of time and that this would lead to a housing recovery.

But now the Fed is losing control of long-term interest rates.  If this continues, either the Federal Reserve will have to substantially increase the rate of quantitative easing or else watch mortgage rates rise to absolutely crippling levels.

Three months ago, the average rate on a 30 year mortgage was 3.35 percent.  It has shot up more than a full point since then...

Mortgage buyer Freddie Mac said Thursday that the average on the 30-year loan rose to 4.39% from 4.31% last week. Rates are a full percentage point higher than in early May.

And as the chart below shows, mortgage rates have a lot more room to go up...

As mortgage rates go up, so do monthly payments.

And monthly payments are already beginning to soar.  Just check out this chart.

So what happens if mortgage rates eventually return to "normal" levels?

Well, it would be absolutely devastating to the housing market.  As mortgage rates rise, less people will be able to afford to buy homes at current prices.  This will force home prices down.

To a large degree, whether or not someone can afford to buy a particular home is determined by interest rates.  The following numbers come from one of my previous articles...

A year ago, the 30 year rate was sitting at 3.66 percent.  The monthly payment on a 30 year, $300,000 mortgage at that rate would be $1374.07.

If the 30 year rate rises to 8 percent, the monthly payment on a 30 year, $300,000 mortgage at that rate would be $2201.29.

Does 8 percent sound crazy to you?

It shouldn't.  8 percent was considered to be normal back in the year 2000.

And we are already seeing rising rates impact the market.  The number of mortgage applications has fallen for 11 of the past 12 weeks, and this has been the biggest 3 month decline in mortgage applications that we have witnessed since 2009.

Rising interest rates will also have a dramatic impact on other areas of the real estate industry as well.  For example, public construction spending is now the lowest that it has been since 2006.

And I find the chart posted below particularly interesting.  As a Christian, I am saddened that construction spending by religious institutions has dropped to a stunningly low level...

So what does all of this mean?

Well, unless interest rates reverse course it appears that we are in the very early stages of another great real estate crash.

Only this time, it might not be so easy for the big banks to swoop in and foreclose on everyone.  Just check out the radical step that one city in California is taking to stop bank foreclosures...

Richmond is the first city in the country to take the controversial step of threatening to use eminent domain, the power to take private property for public use. But other cities have also explored the idea.

Banks, the real estate industry and Wall Street are vehemently opposed to the idea, calling it “unconstitutional” and a violation or property rights, and something that will likely cause a flurry of lawsuits.

Richmond has partnered with San Francisco-based Mortgage Resolution Partners on the plan. Letters have been sent to 32 servicers and trustees who hold the underwater loans. If they refuse the city’s offer, officials will condemn and seize the mortgages, then help homeowners to refinance.

If more communities around the nation start using eminent domain to stop foreclosures, that is going to change the cost of doing business for mortgage lenders and it is likely going to mean more expensive mortgages for all the rest of us.

In any event, all of this talk about a "bright future" for real estate is just a bunch of nonsense.

You can't buy a home if you don't have a good job.  And as I wrote about the other day, there are about 6 million less full-time jobs in America today than there was back in 2007.

You can't get blood out of a stone, and you can't buy a house on a part-time income.  The lack of breadwinner jobs is one of the primary reasons why the homeownership rate in the United States is now at its lowest level in nearly 18 years.

And we aren't going to produce good jobs if our economy is not growing.  And economic growth in the U.S. has been anemic at best, even if you believe the official numbers.

We were originally told that the GDP growth number for the first quarter of 2013 was 2.4 percent.  Then it was revised down to 1.8 percent.  Now it has been revised down to 1.1 percent.

So precisely what are we supposed to believe?

Overall, since Barack Obama has been president the average yearly rate of growth for the U.S. economy has been just over 1 percent.

That isn't very good at all.

But remember, the government numbers have been heavily manipulated to look good.

The reality is even worse.

According to the alternate GDP numbers compiled by John Williams of shadowstats.com, the U.S. economy has continually been in a recession since 2005.

And now interest rates are rising rapidly, and that is very bad news for the U.S. economy.

I hope that you have your seatbelts buckled up tight, because it is going to be a bumpy ride.

Barack Obama: Anti Patent Troll-In-Chief

Submitted by Tyler Durden on 08/03/2013 - 17:51

The man who in the first months of his reign took over the bankruptcy process turning it over on its head to benefit the state over centuries of established creditor rights (with GM, Chrysler and a whole lot of union votes), and who defined his entire first term by nationalizing the US healthcare system, who personally determined the cutoff for "wealth" at $250,000 per year (with the corresponding tax hike "benefits" to go with it), not to mention inheriting the George W. Bush personal surveillance apparatus and taking the nationalization of individual rights and liberties to a whole new level, has just decided to branch out and subordinate yet another two birds of distributed, efficient, global decision-making to his will: trade and patent law.

America’s Urban Distress: Which States And Regions Set Up Their Cities To Fail?

Submitted by Tyler Durden on 08/03/2013 - 15:56

In a nutshell:

Relatively low unemployment rates for the “Western Leaders” aren’t just an artifact of recent strength in, say, energy production and commodities. These states have consistently outperformed the rest of the country.

Abysmally high unemployment rates for the “Eastern Super-laggards” have also persisted for over two decades, exceeding all other parts of the country.

The “Northern Coastal and Great Lakes Laggards” and “Western Laggards and Southeast” fall somewhere between the other two regions, but always favoring the southern states over the northern states.

Not surprisingly, California, Nevada and Florida are more volatile than the other regions, cycling well above and then back toward the Western Leaders in each of the past two decades. Also, the unemployment problems in California and Nevada have been consistently worse than Florida’s unemployment. These trends may or may not persist in coming years. But if your goal is to anticipate the next Stockton, San Bernardino or Detroit, watch the unemployment data closely and pay particular attention to the cities listed here.

Interactive Global Valuation Heatmaps

Submitted by Tyler Durden on 08/03/2013 - 15:08

Yesterday, we reported about private equity's laments that even with ZIRP there are no longer any bargains available in the US (which is why, naturally, the PE industry is now actively selling) with EV/EBITDA multiples north of the traditional 8x borderline benchmark level. Sure enough, as can be seen below, this is indeed the case as the US is now overpriced even for those who have direct access to the Fed's near zero-cost debt funding. So where are PE firms looking next (if anywhere, assuming they aren't spending their time selling "anything that isn't nailed down" which as we know from Leon Black's presentation from April is precisely what they are doing)? The following heatmap of global aggregate Enterprise Value/EBITDA will hopefully put things in their proper, highly overvalued, perspective.

Which Companies (And Cities) Are Spooking Credit Investors The Most?

Submitted by Tyler Durden on 08/03/2013 - 14:07

The Race For The (Fed) Throne - An Update On The Nominees

Submitted by Tyler Durden on 08/03/2013 - 13:45

Confused by all the trial balloons, meandering daily Op-Eds (most of which written by novice journalists with even more bizarre agendas), and "paddy power" market updates? Then here is Scotiabank's Guy Hasselman with his latest rundown on just where we stand in the race for the next Fed chairman.

S&P 500 Profit Margins Plunge To Three Year Lows

Submitted by Tyler Durden on 08/03/2013 - 12:46

That S&P500 revenues are contracting for the second quarter in a row (i.e. a revenue recession) is by now well-known even to CNBC. This is just as we predicted in June of last year, because in a world devoid of growth capital expenditures (and judging by the amount of train, plane and other crashes lately, maintenance capex as well), there can be no organic growth.What, however, may come as a surprise to the market cheerleaders (who unknowingly, or knowingly, are merely cheering Ben Bernanke's magic bubble blowing machine, see final chart) is that that other key component of bottom line improvement, profit margins, are not only not at record highs contrary to what conventional wisdom may incorrectly believe, but have been consistently sliding for three years now, and while earnings margins are 'only' back to June 2011 levels at 8.7%, it is the far more critical Operating Margin which has tumbled in the past two years after peaking in Q3 2011 and is now back down to 8.4%, a level not seen since mid-2010.

Guest Post: Drones And The Right To Privacy

Submitted by Tyler Durden on 08/03/2013 - 10:45

On August 6th, the small town of Deer Trail, Colorado is set to vote on an ordinance that will permit the hunting of unmanned surveillance drones. The author of the ordinance, Phillip Steel, claims the gesture is “symbolic.” A handful of other American states are pursuing measures to limit the spying operations of Uncle Sam’s unmanned aerial vehicles. One has to be either lying or painfully ignorant to believe government will not abuse surveillance drones. State officials have rarely failed to use their capacity to terrify the populace. The prospect of around-the-clock surveillance is a chilling thought and one that should not be taken lightly. Unfortunately the only means to achieve some semblance of privacy requires a luddite approach to technology and a hermit’s approach to community. Otherwise, you avail yourself to the terror of visibility in what should otherwise be, in Thomas Paine’s words, the blessing of society.

Moderate To Modest - The Fed "Word Change" Heard Around The World

Submitted by Tyler Durden on 08/03/2013 - 10:04

It started moments after the release of the Federal Reserve’s latest decision on interest rates. Even though officially they announced maintaining the same policies of low rates and Quantitative Easing, it was a single word change in the official text of their press release from the prior month that sent shockwaves around the world and changed everything forever...

Marc Faber On The Sino-American "Manipulative And Protectionist" Standoff

Submitted by Tyler Durden on 08/02/2013 - 20:48

In an important diversion from a pure markets focus, Marc Faber outlines his concerns and hopes for the "economic battle between the US and China," noting that as the gap between the Western world and the US narrows so "through trading links, [China] has more and more influence," especially (he adds) in Africa. His biggest fear, and one stoked every day, is that if the Chinese economy slows down meaningfully, they will depreciate their currency, leaving the world's largest economies "in a mode of protectionism - not just through import quotas - but through currency manipulation." And for now Russia is happy just tp upset the US via diplomatic means, but, Faber warns, should we see commodity prices slide further, low growth in Russia may prompt further actions - especially given US interference in markets and politics.

Eric Sprott On The Detroit Template

Submitted by Tyler Durden on 08/02/2013 - 20:08

The problem is clear; every level of government has promised too much and is now faced with the politically unappealing prospect of either drastically increasing taxes for the working age population or significantly reducing benefits for the retired (or future retired). As evidenced by the Detroit bankruptcy, the longer we wait, the worse it will get. The greater the delay, the more pain and suffering citizens will face when the benefits and safety nets they have come to expect from the government suddenly disappear. Over time, politicians from all stripes have proven adept at cognitive dissonance, but these increases in taxes and cuts to benefits will have to happen, one way or another; it is just a matter of time.

Record 21 Million 'Young Adults' Now Live With Their Parents

Submitted by Tyler Durden on 08/02/2013 - 19:30

Just about a year ago we questioned the "demographic demand" thesis for why the US housing 'recovery' would become self-sustaining and lead to yet another fiscal and monetary 'nirvana'. However, while the 'household formation' meme remains front-and-center among bloviating Fed apologists; the sad facts are that not only is household formation actually still falling but, as a recent Pew Research study finds, a record 21 million young adults are now living at home with their parents.

Guest Post: Enron Redux – Have We Learned Anything?

Submitted by Tyler Durden on 08/02/2013 - 18:48

Greed; corporate arrogance; lobbying influence; excessive leverage; accounting tricks to hide debt; lack of transparency; off balance sheet obligations; mark to market accounting; short-term focus on profit to drive compensation; failure of corporate governance; as well as auditors, analysts, rating agencies and regulators who were either lax, ignorant or complicit. This laundry list of causes has often been used to describe what went wrong in the credit crunch crisis of 2008-2010. Actually these terms were equally used to describe what went wrong with Enron more than twenty years ago. Both crises resulted in what at the time was the biggest bankruptcy in U.S. history — Enron in December 2001 and Lehman Brothers in September 2008. Naturally, this leads to the question that despite all the righteous indignation in the wake of Enron's failure did we really learn or change anything?

Citi: "Be Careful Of The Big Con"

Submitted by Tyler Durden on 08/02/2013 - 18:08

Despite rising gas prices, rising mortgage rates, slowing income growth and the rise of 'low-quality' part-time jobs, 'con'sumer 'con'fidence 'con'tinues to rise to post-recession highs. However, as Citi's FX Technicals group notes, for the 3rd time in the last 17 year period we may be looking at a 4-year-4-month rise in consumer confidence before a turn lower again; and in spite of the Fed's rosy forecasts (and the market's expectations), we should be careful being too quick to believe that the sluggish economic dynamic that has 'dogged us' for the last 6 years is yet fully behind us.

Guest Post: Why Another Great Real Estate Crash Is Coming

Submitted by Tyler Durden on 08/02/2013 - 17:39

There are very few segments of the U.S. economy that are more heavily affected by interest rates than the real estate market is.  When mortgage rates reached all-time low levels late last year, it fueled a little "mini-bubble" in housing which was greatly celebrated by the mainstream media.  Unfortunately, the tide is now turning.

Taxpayers to foot bill for congressional employees' health care...

Will pay 75% of premiums...

DEAL: 'Exempt from Obamacare'...

Oregon Sheriff’s Dept. Allows Public Insight Through Citizen Training Courses

Infowars.com | Oregon sheriff’s department opens its doors and offers citizens opportunity to observe department’s inner workings.

U.S. Issues Global Terror Threat Alert

Julie Wilson | “We know about it, and we may know about you.”

Backpacks, Pressure Cookers, and the Truth

Bob Adelmann | It was a confluence of magnificent proportions.

One Day After Russian Asylum for Snowden: Obama Administration Launches Terror Scare

Thomas Gaist | None of the government’s claims should be taken for good coin.

XKeyscore: Instrument of Mass Surveillance

Stephen Lendman | Police states operate this way.

John McCain Wants a New Cold War With Russia Over Snowden

Kurt Nimmo | Also exploits former NSA analyst in bid to rescue Rothschild collaborator Mikhail Khodorkovsky.

Bradley Manning Verdict Convicts Washington

Paul Craig Roberts | Americans do not understand that the “justice system” is corrupted.

Should Hitler Dog Be Destroyed?

Prison Planet.com | JC Penny recently pulled a kettle off it’s shelves because of some perceived likeness to Adolf Hitler.

Watchdog Group Sues For Details Of Obama Luxury Holidays

Steve Watson | Wants cost breakdown of “weekend with the boys, presidential style”.

Designing the mind: a fable

Jon Rappoport | It’s easy to believe the mind is little more than a series of programs that can switched and replaced with no damage done.

Apple proposes new terms in e-books battle

cnet.com | Company offers own set of measures for complying with fallout from loss against Justice Department.

NSA Spying Directly Harms Internet Companies, Silicon Valley, California … And the Entire U.S. Economy

Washington’s Blog | Mass Surveillance Is “Killing Our Most Productive Golden Goose”.

Obama defends Larry Summers against charges he is unfit to be Fed chairman

The Hill | President Obama on Wednesday defended Larry Summers from liberal charges that the former Treasury secretary is unfit to head the Federal Reserve.

Colorado foreclosure firm on hot seat

Denver Post | Whistle-blower alleges law group padded expenses, kept refunds due clients.

Paul Ryan’s claim that $15 trillion has been spent on the war on poverty

Glen Kessler | “It seems government’s approach to poverty — including how it measures poverty — is in need of serious rethinking.”

Study: Record Number 21 Million Young Adults Living With Parents

CBS D.C. | New study from Pew Research finds that 36 percent of Millennials – young adults ages 18 to 31 – are living at their parents’ homes.

Type The Wrong Thing Into A Search Engine And The Secret Police Will Come Knocking On Your Door

The control freaks are out of control.  Once upon a time America was “the land of the free”, but now it has become “the land of the bureaucrats”, and these bureaucrats are absolutely obsessed with watching, tracking, monitoring and controlling virtually everything that you do.  Last month, I wrote about how the Obama administration forced a small-time magician out in Missouri to submit a 32 page disaster plan for the little rabbit that he uses in his magic shows for kids.  A lot of people thought that story was quite humorous, but the examples in this article are not so funny.  In recent days we have learned that the government is monitoring just about everything that we do on the Internet, and we have also learned that a couple of innocent Google searches can result in armed government agents pounding on your front door.  If you do not believe this, read on… (Read More.....)

DEMS: BAIL OUT DETROIT

QAEDA RISES AGAIN...
STATE DEPT ISSUES WORLDWIDE TRAVEL ALERT...
U.S. EMBASSIES ACROSS MIDDLE EAST TO SHUT DOWN SUNDAY...
Obama's birthday...
'Precautionary'...
UPDATE: Dozens of CIA ops on ground during Benghazi hit...
'Running arms-smuggling team when consulate was attacked'...
Rep: Obama admin hiding survivors, changing their names...

NJ TENT CITY FOR POOR...

SEC investigates company co-founded by Terry McAuliffe...
McAuliffe's multiple meetings with Obama nominee raise red flags...

953,000 Jobs Created In '13 -- 731,000 Part-Time!
Study: Record Number 21 Million Young Adults Living With Parents...
BLACK TEEN UNEMPLOYMENT RATE 41.6%...

LAWYER: Snowden finds 'safe place' to live...
Asylum threatens U.S.-Russia talks...
COLD: Russia gave USA no heads up on release...
'No plans to leave': Has job offer, awaits reunion with family, girlfriend...
Putin Shows Global Mojo...

Teen With Muscular Dystrophy Beaten, Stabbed, Robbed, Dumped Over Hillside... { Yet another typical nigger soiree! }

Rangel: Tea Party Is Bunch Of 'White Crackers'... { Riiiiight! No uncivilized niggers allowed! }

Watchdog Group Sues For Details Of Obama Luxury Holidays

Steve Watson | Wants cost breakdown of “weekend with the boys, presidential style”.

News Editor Fired for Headline Critical of Obama

Julie Wilson | “I just became the first person in the history of newspapers to be fired for writing a paper’s most-read article,” he tweeted.

Small Town Police Are Tooling Up With Elite Military Hardware

Steve Watson | Line between police and troops is now a blur.

Foster Care System Traps Children into Vicious Cycle of Sex Abuse

Lee Ann McAdoo | Children rescued from sex abuse are placed right back into it.

War, Murder, Rape: Blame Climate Change

Kurt Nimmo | Even domestic violence in India is related to weather, according to warmist scientists.

Arkansas Arms Teachers In Schools; Hiding and Locking Doors “Is Not a Plan”

Steve Watson | School officials to undergo elite training.

Celebrities as symbols

Jon Rappoport | A museum show of celebrity photographs would be meaningless if you hadn’t been “prepped.”

How the NSA Manipulates Language To Mislead The Public

Michael Krieger | It’s no wonder Big Brother emphasized language in order to exert mind control on the population.

Paul Ryan’s claim that $15 trillion has been spent on the war on poverty

Glen Kessler | “It seems government’s approach to poverty — including how it measures poverty — is in need of serious rethinking.”

Study: Record Number 21 Million Young Adults Living With Parents

CBS D.C. | New study from Pew Research finds that 36 percent of Millennials – young adults ages 18 to 31 – are living at their parents’ homes.

New Rudd Government tax on bank deposits will hit you

The Advertiser | The “savings tax” would mean a customer with a $100,000 deposit could lose $4 a month in interest.

MiNiPaX ORDeR OF THe DaY...

Submitted by williambanzai7 on 08/02/2013 15:46 -0400

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The Trader Games Are Ending Posted by: Phoenix Capital... Post date: 08/02/2013 - Traders shot for and managed to hit 1,700 on the S&P 500. At this point, there is no real reason for this other than trader games (start of the month buying).

NFP Shakedown! Posted by: Pivotfarm Post date: 08/02/2013 - A discussion post NFP of markets, economics and tapering!

Obamacare Full Frontal: Of 953,000 Jobs Created In 2013, 77%, Or 731,000 Are Part-Time

Submitted by Tyler Durden on 08/02/2013 - 09:04

When the payroll report was released last month, the world finally noticed what we had been saying for nearly three years: that the US was slowly being converted to a part-time worker society. This slow conversion accelerated drastically in the last few months, and especially in June, when part time jobs exploded higher by 360K while full time jobs dropped by 240K. In July we are sad to report that America's conversation to a part-time worker society is not "tapering": according to the Household Survey, of the 266K jobs created (note this number differs from the establishment survey), only 35% of jobs, or 92K, were full time. The rest were... not.

Citi: "Be Careful Of The Big Con"

Submitted by Tyler Durden on 08/02/2013 - 18:08

Despite rising gas prices, rising mortgage rates, slowing income growth and the rise of 'low-quality' part-time jobs, 'con'sumer 'con'fidence 'con'tinues to rise to post-recession highs. However, as Citi's FX Technicals group notes, for the 3rd time in the last 17 year period we may be looking at a 4-year-4-month rise in consumer confidence before a turn lower again; and in spite of the Fed's rosy forecasts (and the market's expectations), we should be careful being too quick to believe that the sluggish economic dynamic that has 'dogged us' for the last 6 years is yet fully behind us.

Guest Post: Why Another Great Real Estate Crash Is Coming

Submitted by Tyler Durden on 08/02/2013 - 17:39

There are very few segments of the U.S. economy that are more heavily affected by interest rates than the real estate market is.  When mortgage rates reached all-time low levels late last year, it fueled a little "mini-bubble" in housing which was greatly celebrated by the mainstream media.  Unfortunately, the tide is now turning.

The Week That Was: July 29th - Auguest 2nd 2013

Submitted by Tyler Durden on 08/02/2013 - 17:18

Succinctly summarizing the positive and negative news, data, and market events of the week...

Friday Humor: US Citizens 'Just' Want To Be Safe, Happy, Rich, Comfortable, & Entertained At All Times

Submitted by Tyler Durden on 08/02/2013 - 16:42

Fact or Fiction: In a new report released Wednesday, Americans indicated that when it comes to what they expect from their country, all they really want is to be safe, happy, rich, comfortable, and entertained at absolutely all times.

S&P Closes At Record High Thanks To "BTFATH Mentality"

Submitted by Tyler Durden on 08/02/2013 - 16:07

Well that's that - Bad is definitely good. While an initial dip was seen in US equities (as the rest of the asset-classes shifted in Taper-off mode after the dismal jobs/factory orders data), it didn't take long (and took no volume) to wriggle us back up to green and a new all-time high for stocks. But while stocks ended unch for all intent and purpose, the moves were violent elsewhere. 10Y yields collapsed the most in over 5 months today (continuing its ECG-like performance recently); the USD dropped over 0.5% on the day; and while gold ended the day unch, silver (and gold) gapped higher on the NFP release (ending the week lower though). High-yield credit markets are not amused - following long-dated bonds' 7bps yield increase on the week (confirming unwind fears as opposed to growth-driven hopes). Homebuilders gained over 4% on the week (just because). On the week, 'most-shorted' stocks tripled the market's performance. VIX closed at 12.00% - lowest in almost 4 months. BTFATH

Geithner To Advise Obama On Next Fed Chairman

Submitted by Tyler Durden on 08/02/2013 - 15:39

While assuring the world that he will not give advantage to Larry Summers, we wonder if the meeting with the President will sound a little like this?

Presenting Today's Blatant Bond Market Manipulation (Or BLS Leak)

Submitted by Tyler Durden on 08/02/2013 - 15:32

Today is the second time in three months that someone, or something, either leaked the Non-farm payroll data just ahead of its official release, or if not leaked then a trading algorithm manipulated the bond market ahead of the official data release by launching a "momentum ignition" (see here, here and here for much more on how HFT uses this strategy over and over to set trading bands) launch higher just ahead of the official data release at 8:30:00:0000 am that desperately needed to push 10 Year yields, already on the verge of a 2 year breakout, lower.

When The "Market" Thinks The Taper Will Begin?

Submitted by Tyler Durden on 08/02/2013 - 14:56

With the return of Federal Reserve Chair(wo)man odds at PaddyPower (leaving Summers a dreary 28% likelihood of winning) comes the Irish bettors' latest gamble... when will the US Fed initiate Tapering of QE? Based on the month during which the first reduction of QE bond-buying from the current $85bn per month, it seems (unlike the majority of prognosticators and standing blithely in the face of technical, political, and deficit reasons) that tapering will not begin until December at earliest with most believing 2014-or-later...

Guest Post: Amazon.com Creates 5,000 Jobs, Destroys 25,000 In The Process?

Submitted by Tyler Durden on 08/02/2013 - 14:25

The past few weeks have seen the tech and business media abuzz about a not-so-little warehouse in Tennessee. That's because this distribution center, opening its doors with a burst of fanfare and even a few visits from nearby politicians, isn't a jumping-off point for Macy's or Target. Instead, the warehouse is the latest in a series of new locations being opened by retail technology giant Amazon.com. The jobs this new mega-warehouse is purported to create: 5,000. However, as we discuss below, for every job Amazon "creates," four other jobs go away at a company like TJX.

Chart Of The "Recovery": GDP vs Market Capitalization Since "The Lows"

Submitted by Tyler Durden on 08/02/2013 - 13:55

In short:

Since the March 2009 lows, US GDP has increased by $2.3 trillion.
Since the March 2009 lows, the capitalization of the US stock market has increased by $12.3 trillion.
Delta between the two: 436% in favor of stocks.

Guest Post: The Snowden Time-Bomb

Submitted by Tyler Durden on 08/02/2013 - 13:18

In the aftermath of the global financial crisis, world leaders repeated a soothing mantra. There could be no repeat of the Great Depression, not only because monetary policy was much better (it was), but also because international cooperation was better institutionalized. And yet one man, the American former intelligence contractor Edward Snowden, has shown how far removed from reality that claim remains. Prolonged periods of strain tend to weaken the fabric of institutional cooperation. The two institutions that seemed most dynamic and effective in 2008-2009 were the International Monetary Fund and the G-20; the credibility of both has been steadily eroded over the long course of the crisis. The Snowden affair has blown up any illusion about trust between leaders – and also about leaders’ competence.

Spain To Suffer At Least 25% Unemployment Until 2018, IMF Forecasts

Submitted by Tyler Durden on 08/02/2013 - 12:43

With the mean-reverting extrapolators all calling the bottom in Europe and scandal-plagued PM Rajoy desperate for distraction repeatedly arguing that the country's depressed economy is finally emerging from a two-tear slump, the FT reports that IMF has just popped that balloon of hope. "Spain has historically never generated net employment when the economy grew less that 1.5-2%,” the IMF notes, pointing out "yet growth is not projected to reach these rates even in the medium-term." In fact, echoing recent warnings from independent economists at exuberance over the most recent data (driven by seasonally-enhanced tourism) as the start of a new trend, the IMF warns, "the weak recovery will constrain employment gains, with unemployment remaining above 25 per cent in 2018." So, for Rajoy, its back to the grift.

Pakistan Bans Gold Imports for 30 Days

Submitted by Tyler Durden on 08/02/2013 - 12:19

The latest buzz circulating around the gold market relates to news that Pakistan’s Economic Coordination Committee of the Cabinet (ECC) has decided to ban duty free gold imports for thirty days. Why you ask? Because those pesky Indians are using Pakistan as a conduit to get around the country’s recent 8% duty imposed on gold imports. All of this of course begs the question: With the price of gold “plunging” over the past several months, why did Pakistan and India both feel the need to take such draconian measures against a barbarous relic that everyone is supposedly panic selling? If there is so much gold to be had and no one wants it, what’s the problem? Strange indeed...

US Escalates: Issues Worldwide Travel Alert Following Embassy Closures

Submitted by Tyler Durden on 08/02/2013 - 11:49

With US leaks about Israeli air strike on Syria, John Kerry stirring the civil war pot in Egypt, and the closure of US embassies across the Muslim world (Iraq, Afghanistan, Qatar, Bahrain, Oman, Kuwait, Bangladesh, Saudi Arabia, Libya, Yemen, UAE, Algeria, Mauritania, Sudan, Israel (Tel Aviv) and Jordan), it appears something is afoot. To add to the intrigue, the US State Department just issued a worldwide travel alert for US citizens.

*STATE DEPARTMENT WORLDWIDE TRAVEL ALERT EXPIRES AUGUST 31, 2013
*STATE DEPT ISSUES WORLDWIDE TRAVEL ALERT FOR U.S. CITIZENS

An Al-Qaeda threat has been posited but with no follow-up but we can't help but fear what we wondered about previously - the need for deficits to re-awaken (via some external event that no-one can 'un-patriotically' demur) providing more room for Bernanke to avoid his need for Taper.

Guest Post: 10 Reasons Why Obamacare Is Going To Ruin Your Medical Care... And Your Life

Submitted by Tyler Durden on 08/01/2013 - 20:32

The bottom line is that Americans are losing more and more of their medical freedom.  By 2015, so many workers will be trapped in the government-run health insurance exchanges that there will be no going back to the private plans we have today. At this rate, single-payer proponents will drive private insurance companies out of business, which has been their intention all along. Obamacare is a hodgepodge of new regulations, requirements, and penalties. Here are the ten most important points that doctors should tell their patients.

A Perfect Symmetry?

Submitted by Tyler Durden on 08/01/2013 - 19:59

With rates rising amid the glorious faith that recovery is upon us, tapering is a storm in a teacup, and nothing can stop us now, we present the dreadful symmetry of the US leverage situation (Federal Debt-to-GDP) relative to rates. We suggest investors be careful what they wish for on 'rotational' fantasies as GDP growth won't save us this time and the deleveraging effect of any serious retrenchment in debt will feedback into the 'credit-is-growth' drain-circling that has been evident for the last 30 years... So, if we do indeed have perfect historic symmetry, what will be the 'event' that takes total US debt from well over 100% of GDP to less than half of that?

Correlation Collapse Cause For Corrective Concern

Submitted by Tyler Durden on 08/01/2013 - 19:23

Intra-stock correlation of the top 50 market cap names has plunged in the past month. As Citi's Tobias Levkocich warns that suggests that investors might be overly focused on stock picking and have begun to ignore broader influences such as Fed policy, market valuation, European growth trends, economic surprise indices and the like. As performance issues have forced some investors into higher beta areas in order to boost outcomes, one would think that a more precarious correlative environment such as this would imply taking down more aggressive portfolio risk. Given today's ramp in builders and transports, that appears a far flung idea for now...

Court sides with retailers, goes against Fed rule on debit card fees

The Washington Post | A judge overturned a Federal Reserve rule capping debit card fees that banks collect from merchants.

Fed keeps stimulus going, leaves rates unchanged

Jeff Cox | Federal Reserve will keep interest rates unchanged and keep buying $85 billion in bonds every month.

10 Reasons the U.S. Economy Is Stuck

Moira Herbst | The reality is that we’re hollowing out the middle class.

Footage of Nancy Pelosi In Secret Obama-care Meeting

Infowars.com | This satirical reenactment is not 1% as bad as the truth.

Pentagon Has Awarded Contracts To Al-Qaeda In Afghanistan

Steve Watson | Obama is the global head of terrorist network.

Vermont Man Handcuffed, Detained by Police for Legal Open Carry

Adan Salazar | National Guard veteran detained for doing nothing illegal.

Chris Matthews: Ted Cruz is a Terrorist

Kurt Nimmo | The teleprompter reader Chris Matthews is at it again.

Security Consultant Heckles NSA Head: Shouts “Freedom!”; “Read The Constitution!”

Steve Watson | Gen. Alexander claims “We stand for freedom”.

Snowden’s Father Calls Out Obama On Nuremberg Crimes

Kurt Nimmo | U.S. national security state media refused to run open letter sent to Obama.

Your Tax Dollars at Work in Afghanistan Supporting al-Qaeda

Kurt Nimmo | Supposed enemies on the government payroll — again.

Rand Paul Strongly Hints At 2016 Presidential Run

Steve Watson | Senator offers to take Christie for a beer, but maintains attacks are “stupid”.

The Most Important Number In The Entire U.S. Economy

Submitted by Tyler Durden on 08/01/2013 - 16:56

There is one vitally important number that everyone needs to be watching right now, and it doesn't have anything to do with unemployment, inflation or housing.  If this number gets too high, it will collapse the entire U.S. financial system.

Those Hard(ly) Working French

Submitted by Tyler Durden on 08/01/2013 - 18:21

Just four months ago, the CEO of Titan International laid down some ugly truthiness on the dismal realities in the united socialist states of France. It was not well-received by the French. But it seems we have been too hasty with our prognostications on the hard-working (or hardly working) French. As Reuters reports, despite France's move to a 35-hour week (a flagship of the socialist government) a decade ago, French workers put in an 'astounding' 39.5 hours a week in 2011. While management complain that these policies have bloated labor costs and hurt their ability to compete globally (as Taylor argued), "this is the problem of France. It's cut in half. Half the French are working like madmen to make up for the other half who stick to their hours." But just for some context, this rise in French (average) working hours, leaves them ranked 21st in terms of hours worked per week out of the 27 states that comprised European Union in 2011.

Spot The Odd One Out

Submitted by Tyler Durden on 08/01/2013 - 17:52

Sustainable?

Bank Of America Reveals Pending DOJ Civil Charges Against It, Merrill Lynch

Submitted by Tyler Durden on 08/01/2013 - 17:36

Lurking deep in the just filed Bank of America 10-Q (alongside data on its quarterly trading acumen which as usual made a mockery of random statistical probability distribution with just 7 days of losses and profits on 57) is this nugget which shows BAC's litigation expenses may be set to surge once more.

Quote Of The Day From An "Accountable, Transparent" Goldman Sachs

Submitted by Tyler Durden on 08/01/2013 - 16:27

Today's quote of the day from Goldman Sachs spokesman Michael DuVally, who in the aftermath of the Fab Tourre verdict, had this to say.

"As a firm, we remain focused on being more transparent, more accountable, and more responsive to the needs of our clients."

That pretty much sums up everything one needs to know about the new normal.

Trannies Top; Bonds Bottom; Credit Crumbling

Submitted by Tyler Durden on 08/01/2013 - 16:07

Trannies 3.3% gain today is the best in 20 months - which makes perfect sense given that WTI crude prices are also spiking 2.7% breaking back above $108 (and XOM biggest miss on earnings in forever). Treasuries continue to suffer with 7Y worst - up an stunning 14bps on the day (its biggest jump in a month) as 30Y breaks above 2013 high yields. Credit markets disconnected from equity markets new reality and ended the day wider (as once again credit tracked rates - which does not bode well for stock valuations since it is clearly not a move based on growth). Considerable USD strength across all the majors, gold/silver modestly lower, Oil and copper surging. All-time record highs for the S&P and Dow. BTFATH

Domestic Car Sales Miss, Biggest Drop In 9 Months

Submitted by Tyler Durden on 08/01/2013 - 15:51

Another example of the unintended consequence of a taper-growth-rotation rise in interest rates? Who knows, but yet another pillar of the 'recovery' just started to crack... Where's Phil LeBeau, when we need him the most, to tell us how great this?

Unfabulous Fab: Tourre Found "Liable" In Defrauding Investors

Submitted by Tyler Durden on 08/01/2013 - 15:36

Someone is going to face the music after all. It seems the SEC has its mid-level (non-executive) crisis scapegoat:

*TOURRE LOSES SEC CASE CLAIMING FRAUD IN $1 BILLION CDO

Tourre has been found guilty on 6 of the 7 cases - we await news on the financial penalties. Perhaps more critically, this finding (in favor of the SEC) may open the door for more lawsuits against Goldman with regard similar transactions.

Long Dated Bonds Surge To 3.77% - 2 Year Highs

Submitted by Tyler Durden on 08/01/2013 - 15:21

Equities appear to be celebrating the bond market's rapid collapse today but there are already unintended consequences. With the entire complex seeing yields spike the most in a month (cracking back above yesterday's post-FOMC spike highs), 30Y yields have broken to new two-year high levels at 3.77%. As rates rise, issuers are struggling. Whether it is because of Detroit concerns or the sell-off in bonds, Michigan's Genesee County just pulled its $53mm muni offering  as "investors wanted a much higher interest rate than the county wanted to pay." The offering didn't attract buyers for a 29-year bond, the longest maturity in the deal, at an interest rate or 5.34%. Perhaps they should have issued stock?

Guest Post: Why Oil Could Move Higher... Much Higher

Submitted by Tyler Durden on 08/01/2013 - 14:52

The conventional wisdom of the moment is that a weakening global economy will push the cost of commodities such as oil down as demand stagnates. This makes perfect sense in terms of physical supply and demand, but this ignores the consequences of financial demand and capital flows. The total financial wealth sloshing around the world is approximately $160 trillion. If some relatively modest percentage of this money enters the commodity sector (and more specifically, oil) as a low-risk opportunity, this flow would drive the price of oil higher on its own, regardless of end-user demand and deflationary forces. If we grasp that financial demand is equivalent to end-user demand, we understand why oil could climb to $125/barrel or even higher despite a physical surplus.

The J.C.Petanic: Why Are All These Executives Bailing The Sinking Retailer?

Submitted by Tyler Durden on 08/01/2013 - 14:27

There have been 10 senior-level management departures since Ron Johnson left the company in April. As Citi notes, the current state of the business is making it difficult for JCP to attract management talent and without a turnaround team, there is no turnaround. Key positions that remain vacant include Chief Marketing Officer, Chief Technology Officer, GMM of Home, and EVP, Real Estate. But apart from that, JCP is great...

Furious White House Blasts Russian Asylum For Snowden

Submitted by Tyler Durden on 08/01/2013 - 13:52

The U.S. is "extremely disappointed" in the move by Russia to grant 'temporary asylum' to Edward Snowden, White House spokesman Jay Carney told reporters this morning. Carney appeared to add a threat, as the WSJ reports, he added that the Russian decision undermines law-enforcement cooperation between Moscow and Washington. Russia's decision also threatens to derail a planned September summit in Moscow between Obama and Putin (oh to be a fly on that wall), as Carney advised "we are evaluating the utility of a summit in light of this." Snowden's earlier comments that "over the past eight weeks we have seen the Obama administration show no respect for international or domestic law, but in the end the law is winning," did not help, adding that he thanks "the Russian Federation for granting  asylum in accordance with its laws and international obligations." US politicians see it a little differently, U.S. Sen. John McCain (R-A.Z.) called the move "a disgrace and a deliberate effort to embarrass the United States." Seems they are managing that all on their own.

Court Kicks Berlusconi Trial Can: Confirms Conviction, Orders Review Of Political Ban

Submitted by Tyler Durden on 08/01/2013 - 13:51

In what is a relatively surprising headline, the Italian court has decided to uphold Berlusconi's Mediaset Tax fraud conviction... but appears to have left the door open for some more fun and games...

*COURT CONFIRMS BERLUSCONI CONVICTION

Court confirms Berlusconi prison sentence (Reuters)

But, it would seem, we may just see him make a run at the PM spot once again (once he gets out of clink)...

*ITALY COURT ORDERS REVIEW OF PUBLIC-OFFICE BAN FOR BERLUSCONI

Of course, his 'sex with an under-age person' trial remains...(along with its potential life-time ban)

Guest Post: How America’s Working Stiffs Got Stiffed

Submitted by Tyler Durden on 08/01/2013 - 13:17

The real wages of the typical working man in the US have gone down for the last 60 years. In terms of his time, his most important purchases are more expensive today than they were in 1950. How did American workers survive with lower real wages and higher living costs? First, they began to work longer hours. Wives went to work. Husbands worked a second job. Now Americans work more hours than any other group. Second, and most importantly from our point of view, they began to borrow. Aided, induced and bamboozled by the feds’ EZ credit policies... they went deep into debt to keep up with their own standards of living.

Boehner Prepares To Kick The Can Again: "It's In The Nation's Interest"

Submitted by Tyler Durden on 08/01/2013 - 12:54

While vainly attempting to look like he is still in the driver's seat, it would appear that John Boehner has once again folded on fiscal conservancy. "It’s clear that we're not going to have the appropriations bills finished by Sept. 30," Boehner noted this morning, adding "I believe a continuing resolution for some short period of time would probably be in the nation’s interest." So it's for our own good - especially as the Fed is set to Taper - that we keep borrowing and spending. But, Boehner adds after seemingly kicking the can, "the idea of operating for an entire year under a CR is not a good way to do business. And I’ve been working try to find a way to actually do all of these appropriations bills." Indeed, get back to work, Mr. Boehner.

Bonds 'Cheapest' To Stocks In Two Years

Submitted by Tyler Durden on 08/01/2013 - 12:29

Presented with little comment aside to note that 'reaching for yield' may soon having an entirely different meaning...

Car Sales Miss Expectations Across The Board

Submitted by Tyler Durden on 08/01/2013 - 12:01

While much is being made of the ISM smash this morning and China's 'official' PMI overnight, it seems cognitive dissonance is on the rise as China's 'other' PMI collapsed and US Construction Spending dropped precipitously. It was only a month ago that ISM was sub-50 and that housing (and construction spending) was set to lift us out of the growth-scare. Apparently not. But there is another pillar of this recovery that has been stalwart during the equity market rally - that of US auto sales... until now...

*FORD U.S. VEHICLE SALES UP 11%, EST. UP 17%
*GM JULY U.S. VEHICLE SALES RISE 16%, EST. UP 20%
*CHRYSLER JULY U.S. VEHICLE SALES UP 11%, EST. UP 16%

It seems that all that channel-stuffing, subprime-lending, term-extending has hit its peak as, despite smiles and being 'pleased', US auto companies are underperforming expectations (as Ferrari exceeds).

Snowden Has Left The Airport - Photographic Proof

Submitted by Tyler Durden on 08/01/2013 - 11:37

Edward Snowden's first taste of fresh Russian air in weeks...

Guest Post: The Fed Matters Much Less Than You Think

Submitted by Tyler Durden on 08/01/2013 - 11:31

Those who follow the mainstream media’s “all Federal Reserve, all the time” coverage of financial news naturally conclude that Senator Chuck Schumer neatly summarized reality last year when he declared that the Federal Reserve “is the only game in town.” This lemming-like belief in the power of the Federal Reserve generates its own psychological force field, of course; the actual power of the Fed is superseded by the belief in its power.  The widespread belief in the Fed’s omnipotence is the source of the Fed’s power to move markets. We can thus anticipate widespread disbelief at the discovery that the Fed is either irrelevant or an impediment to the non-asset-bubble parts of the economy. There is much we, as individuals, can do to ignore the Emperor's clothes (or lack thereof) and focus on how to pursue our own prosperity and happiness irrespective of the meddling of central planners. The real power is in our hands, should we choose to believe it.

Images From A Cave-Hiding, Cloud-Seeding Chinese Heat-Wave

Submitted by Tyler Durden on 08/01/2013 - 11:05

Record-breaking temperatures have been searing large swaths of China, resulting in dozens of heat-related deaths and prompting authorities to issue a national alert. As CNN reports, people are packing into swimming pools or taking refuge in caves in their attempts to escape the fierce temperatures. Local governments are resorting to cloud-seeding technology to try to bring rain to millions of acres of parched farmland. The worst of the smoldering heat wave has been concentrated in the south and east of the country, with Shanghai experiencing its hottest July in at least 140 years. In Shanghai, the heat was being blamed for mounting numbers of dead fish in ponds and rivers and is likely to continue into the middle of August.

"Recovery" Data Point Of The Day

Submitted by Tyler Durden on 08/01/2013 - 10:39

*FERRARI SAYS 1H NET INCOME RISES 20%

*PORSCHE JULY U.S. SALES UP 36%

Manufacturing ISM Smashes Expectations, Surging To 2011 Levels As Construction Spending Plunges

Submitted by Tyler Durden on 08/01/2013 - 10:16

Readers may recall that in our commentary to yesterday's Chicago PMI disappointment we had a simple prediction "What this means for the ISM is not exactly clear due to the long-running tradition of baffle with BS, but on the surface it is hardly optimistic... which likely means ISM will explode higher." Sure enough, to no surprise at all, it just did with the headline ISM manufacturing print for July exploding from 50.9, trouncing expectations of 52.0 with the biggest beat in two years, and hitting 55.4, driven mostly by a surge in production which rose from 53.4 to a ridiculous 65.0, the highest since 2004. And while virtually all of the key subindices in yesterday's Chicago PMI dipped, today it is the opposite, with New Orders (+6.4), Employment (+5.7) and Deliveries (+2.1) all posting increases. Humorously, while Chicago PMI said Prices Paid exploded, today the ISM refuted that and indicated Prices Paid dropped to lowest in a year. One just has to laugh at the Chinazation of US economic data.

Scramble To Exit Housing Market Peaks With "American Homes 4 Rent" IPO Pricing At 44% Discount

Submitted by Tyler Durden on 08/01/2013 - 09:51

Two months ago we first observed the scramble by various hedge funds, in this case Blue Mountain, to take advantage of the peak sentiment in housing, and specifically rental housing (which just hit an all time high as reported previously) by rushing to capitalize on recent investments and dump exposure to the witless public. Specifically, we envisioned the then just announced IPO of the aptly named American Homes 4 Rent (yes, with a "4" not "for"), also known as AMH, which however came at precisely the wrong time for the market: just as mortgage rates were soaring and Colony American Homes postponed its own parallel IPO. Two months later, with the market about to pass 1700 and fears about the housing market put back in the shelf despite a glaringly obvious collapse in mortgage demand, these IPOs are back and with a vengeance, although now reflecting a far more subdued, tapered if you will, view about the house leasing sector. Not surprisingly, AMH priced overnight, selling 44.1 million shares at a price at the bottom of the $16-18 range to raise a total of $706 million: a 44% discount to the $1.25 billion suggested in the prospectus filed back in June.

S&P 500 Hits 1,700 (Rising At A 140% Annualized Rate)

Submitted by Tyler Durden on 08/01/2013 - 09:35

After spending the last two weeks in a 20 point range, the S&P 500 has finally passed the all-important 1,700 level after the Fed's directionless statement was trumped by Hilsenrath's confirmation that the Taper 'may' be delayed and the late-day collapse in stocks was trumped by a 'miracle' from China and this morning's promises from Draghi. After its initial spurt off the 6/24 un-taper lows, the S&P surged at a wonderful 200% annualized pace but the sideways oscillation of the last few days has dragged that extrapolated performance exuberance down to a mere 140% annualized. As a reminder, there is a buyer (retail) for every seller (professional); what could possibly go wrong? It seems 'on hold' is the new BTFATH (and sell bonds).

Guest Post: Canada Threatens U.S. With Oil Trains If Keystone XL Not Built

Submitted by Tyler Durden on 08/01/2013 - 09:11

On 6 July, a Montreal, Maine & Atlantic train carrying 72 tank cars filled with oil exploded after its brakes apparently failed, sending it rolling into the small Quebec town of Lac-Megantic, where it derailed and then exploded. In the conflagration that followed, an estimated 47 people were killed. Whether Canadians like it or not, the use of such trains has soared in recent years. Now, in a breathtaking display of chutzpah, the Canadian ambassador to the U.S. is warning President Obama if he does not approve the controversial Keystone XL pipeline, then he can expect similar oil trains and even trucks to enter the U.S..

Initial Claims Beat, Lowest Since Jan 2008

Submitted by Tyler Durden on 08/01/2013 - 08:41

Good news appaears (for now) to not be bad news for stocks but it is bad news for bonds as they sell-off modestly on the best beat in initial claims in 3 months and the lowest absolute (pre-revision next week) level since January 2008. The highest insured unemployment rates in the week ending July 20 were in Puerto Rico (4.9), New Jersey (3.6), Connecticut (3.5), Alaska (3.4), California (3.4), Pennsylvania (3.4), New Mexico (3.2), Nevada (2.9), Virgin Islands (2.9), Illinois (2.8), New York (2.8), Oregon (2.8), and Rhode Island (2.8). So these are pre-recessionary levels of jobless claims and extended claims continue to slide (and Challenger this morning was positive) - but how does this exuberant job situation fit with the dismal economic data? Perhaps this?

Mario Draghi's ECB Press Conference - Live Webcast

Submitted by Tyler Durden on 08/01/2013 - 08:30

Following his decision to leave rates unchanged, the investing public can only buy-first and hold their breath for some hint at more fragmentation-beating, collateral-easing, negative-rate hinting 'promises' from the most important man in the world for today.

*DRAGHI SAYS ECB EXPECTS RATES TO STAY LOW FOR EXTENDED PERIOD
*DRAGHI SAYS EURO AREA GROWTH RISKS REMAIN 'ON THE DOWNSIDE'
*DRAGHI SAYS WEAK LOAN DYNAMICS REFLECT STAGE OF BUSINESS CYCLE
*DRAGHI SAYS ESSENTIAL FOR FRAGMENTATION TO DECLINE FURTHER
*DRAGHI SAYS COUNTRIES SHOULD STEP UP STRUCTURAL REFORM PROCESS

July's Best And Worst Performers

Submitted by Tyler Durden on 08/01/2013 - 08:26

Edward Snowden Leaves Moscow Airport, Gets 1 Year Russian Asylum

Submitted by Tyler Durden on 08/01/2013 - 07:55

Snowden gets job offer from Russia's Facebook

MOSCOW (Reuters) - American fugitive Edward Snowden was offered a job by Russia's top social networking site on Thursday, hours after the former intelligence contractor received a year-long asylum in Russia.

"We invite Edward Snowden to Petersburg and will be happy if he decides to join the star team of programmers at VKontakte," Pavel Durov, one of the founders of the St. Petersburg-based VKontakte, Russia's answer to Facebook, said on his profile.

Snowden's temporary asylum papers allow him to work in Russia, according to Anatoly Kucherena, a lawyer close to the Russian authorities, who has been assisting the American.

Moscow has refused Washington's repeated requests to hand over the 30-year-old to face trial on espionage charges after he leaked details of secret U.S. surveillance programs involving phone and Internet data.

Seeking to avoid U.S. prosecution, Snowden arrived to Moscow from Hong Kong on June 23 has been stuck in the transit zone of the Sheremetyevo airport for more than a month before slipping out on Thursday with new refugee documents.

Edward Snowden Granted AsylumPlay video."

The spat over Snowden's fate has added to tensions between Russia and the United States, already at loggerheads over the conflict in Syria as well as other defense and human rights issues.

But Snowden is also a useful propaganda tool for Moscow, which often accuses Washington of preaching on human rights abroad what it does not practice at home.

Durov of VKontakte, or "InTouch", which says it has more than 210 million registered profiles and up to 47 million daily users, said he took pride in Russia's decision to harbor Snowden.

"Today Edward Snowden - the man who denounced U.S. security services' crimes against citizens of the whole world - received temporary asylum in Russia," Durov said.

"In such moments one feels pride with our country and regret over the course taken by United States - a country betraying the principles it was once built on," he added.

WikiLeaks' Assange condemns Manning verdict, Obama Reuters By Andrew Osborn. LONDON | Tue Jul 30, 2013 8:17pm EDT. LONDON (Reuters) - WikiLeaks founder Julian Assange accused President Barack Obama of "national security extremism" on Tuesday after an American military judge convicted Bradley Manning ...

Related Bradley Manning » WikiLeaks »

Manning's ConvictionsWall Street Journal

WikiLeaks founder condemns Manning verdict, ObamaTribune-Review

Featured:Julian Assange, on Eve of Verdict: 'Bradley Manning Is a Hero'National Journal - by Matt Berman

Opinion:A double-edged verdict on Bradley ManningLos Angeles Times

In Depth:Bradley Manning acquitted of aiding the enemyCBS News

Homeownership at 18-Year Low...
Rents Hit Record Highs...
Detroit home priced at $1 sits on the market for 519 days...

TePCO 2020 Posted by : williambanzai7 Post date: 07/31/2013 - And we don't mean vision...

TePCO 2020

Submitted by williambanzai7 on 07/31/2013 13:48 -0400

.

BANZAI7 NEWS--Tokyo Electric Power Co. acknowledged for the first time this week that its Fukushima Dai-ichi plant was leaking contaminated underground water into the ocean, a problem many experts had suspected since shortly after the crisis unfolded more than two years ago.

The operator of Japan's crippled nuclear plant said that it delayed acknowledging that the plant was leaking contaminated water into the sea because it did not want to worry the public until it was certain there was a problem.

As Tokyo enters its final lap in the race to host the 2020 Summer Olympic Games, some investors are already betting on who they think will grab the gold: the wide swath of Japanese corporations who will score lucrative contracts if the metropolis’s bid succeeds: radiation bathing studios, wearable geiger counters, hot buns, nuclear waste mismanagement consultants, cesium rice crackers and strontium green tea ice cream are key industries to watch.

NSA Spying Directly Harms Internet Companies, Silicon Valley, California … And the Entire U.S. Economy Posted by: George Washington Post date: 07/31/2013 - Mass Surveillance Is “Killing Our Most Productive Golden Goose”

Obama’s Corporate Tax ‘Grand Bargain’ Posted by: Pivotfarm Post date: 07/31/2013 - Obama wants to give middle-class Americans a ‘grand bargain’. Roll up! Roll up! You won’t believe your eyes.

44 Facts About The Death Of The Middle Class That Obama Should Know

Submitted by Tyler Durden on 07/31/2013 - 20:03

As Obama parades around middle-America, promoting hope-and-change amid a "Better-Bargain for the middle-class," it seemed only appropriate to lay out a few 'facts' before his next pronouncement. Once upon a time, the United States has the largest and most vibrant middle class in the history of the world. Sadly, things have dramatically changed in America since that time.  There just aren't as many "middle class jobs" as there used to be.  In fact, just six years ago there were about six million more full-time jobs in our economy than there are right now.  Those jobs are being replaced by part-time jobs and temp jobs. We live at a time when incomes are going down but the cost of living just keeps going up. As a result, the middle class in America is being absolutely shredded and the ranks of the poor are steadily growing. The following are 44 facts about the death of the middle class that every American - especially President Obama - should know...

China Bucks AsiaPac Trend With 'Miraculous' Rise In Its PMI

Submitted by Tyler Durden on 07/31/2013 - 21:09

Following Japan's disappointing PMI last night, and after some 'hope' in June,  Aussie PMI collapsed from an almost 'recovering' 49.6 to 42.0 with only 1 in 12 industries expanding and production, employment, and new orders all falling further into contraction. Then came a formerly consistent bellwether of the global recovery (until of course it started to fall when it became irrelevant) - South Korea's PMI tumbled to 47.2 (from 49.4) - its lowest since Sept 2012 (and falling for the 3rd month in a row) and employment down the fastest in 17 months. Then after the early Flash HSBC PMI printed at 11-month lows (final HSBC PMI shortly) and firmly in contraction, China's official PMI just arrived at a perfectly 'reasonable' 50.3 (highest in 2 months) and well ahead of a contractionary 49.8 expectation. Remember this is the same data whose subsets were temporarily (and then permanently) removed last month. This is the widest disparity from HSBC's measure in 15 months.

NSA Admits: 'We Do Store All Your Data But We Don't Look At It All'

Submitted by Tyler Durden on 07/31/2013 - 20:35

The Director of National Intelligence released three declassified "in the interests of transparency" documents this morning that authorized and explained the bulk collection of phone data - one of the secret surveillance programs that Snowden revealed. As Reuters reports, much of what is contained in the documents has already been divulged in public hearings by intelligence officials but the National Security Agency's "Bulk Collection Program," carried out under the U.S. Patriot Act, is now in the open. Have no fear though, "Although the programs collect a large amount of information, the vast majority of that information is never reviewed by anyone in the government," the report said. As Senator Patrick Leahy commented, "what has to be of more concern in a democracy is whether the trust of the American people is beginning to wear thin."

Dylan Grice On The Intrinsic Value Of Gold, And How Not To Be A Turkey

Submitted by Tyler Durden on 07/31/2013 - 19:23

Today’s bizarre confluence of negative real interest rates, money printing, eurozone sovereign default, aberrant asset prices, high unemployment, political polarization, growing distrust… none of it was supposed to happen. It is the unintended consequence of past crisis-fighting campaigns, like a troupe of comedy firemen leaving behind them a bigger fire than the one they came to extinguish. What will be the unintended consequences of today’s firefighting? We shudder to think.

Presenting The Location Of The NSA's Secret FISA Court

Submitted by Tyler Durden on 07/31/2013 - 18:25

The nation's spy court has begun operations in a new, secure space on the third floor of the E. Barrett Prettyman Courthouse in downtown Washington, ending its 30-year run of issuing secret warrants from within the Justice Department, according to three sources connected to the Foreign Intelligence Surveillance Court who spoke on the condition of anonymity, citing the strict secrecy surrounding it.

Count Yourself Among The Poor!

Submitted by Tyler Durden on 07/31/2013 - 17:47

Go ahead, be a fool, tell yourself that you are still part of that once proud American “middle-class,” then dare look in the mirror and see yourself as nothing but a zombie. Or, rather, the new identifiable species in the US: the Amerizombie, a reanimated economic corpse, undead but politically clueless to the new global realities.

Financial Sense And Nonsense

Submitted by Tyler Durden on 07/31/2013 - 17:07

“…the best way to get interest rates up is to have low interest rates" —Fed Chairman Bernanke responding to a Congressional testimony question

“We all know it’s going to end badly, but in the meantime we can make some money.” —Jim Cramer, CNBC

“Thank God for the Fed.” —Australian Treasurer Wayne Swan

“Let’s be clear. We’ve intentionally blown the biggest government bond bubble in history.” —Andy Haldane, Bank of England director of financial stability

The Financial System Doesn't Just Enable Theft, It Is Theft

Submitted by Tyler Durden on 07/31/2013 - 16:49

It is painfully self-evident that our financial system doesn't just enable theft, it is theft by nature and design. If you doubt this, please follow along...

"The first panacea for a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permanent ruin. But both are the refuge of political and economic opportunists."

Ernest Hemingway, The Next War

Fed Humiliated With Red Close Despite Dovish FOMC And GDP Revision

Submitted by Tyler Durden on 07/31/2013 - 16:17

A very volatile day in stocks ended with a violent high volume dump from post-FOMC highs on heavy MoC selling pressure that left the S&P and Dow with red closes. S&P futures still managed their best month since Oct 2011 - though unable yet again to capture the 1,700 flag. The size and scale of the 'rotation' into the close (and strength in bonds) leaves us wondering who is buying and who is selling. For some context, post-FOMC, S&P -4pts, 10Y -8bps, Gold +$10, USD -0.15%; so it seems bonds benefited the most and stocks seem to be crying out for moar. The Dow has now closed red for 3 days-in-a-row - the worst streak in seven weeks.

It Really Isn't Ackman's Day As CIT Pulls JCPenney Credit

Submitted by Tyler Durden on 07/31/2013 - 15:38

While we have heard this rumor before, the NY Post is reporting that CIT - the largest commercial lender/factor in the US apparel industry - has abruptly stopped supporting deliveries from smaller manufacturers to JCPenney stores. Insiders speculated that CIT got skittish after meeting with JCP officials yesterday and getting a glimpse of financials. It really is not Bill Ackman's day - HLF +10%, JCP -6.7%.

Chart Of The Day: Foreigners Are Quietly Getting Out Of Dodge

Submitted by Tyler Durden on 07/31/2013 - 15:26

While the Fed is posturing daily whether it will or it won't monetize an ever greater portion of gross US issuance (and considering the drop in US funding needs, unless the Fed tapers it will soon very soon buy more than 100% of all 10 Year equivalent issuance going forward), foreigners have made their position vis-a-vis US paper loud and clear. What is their position? The following chart from today's TBAC presentation to the Treasury makes it very clear. With an ever declining, and recently the smallest on file, notional amount of Treasurys at auction going to foreigners since 2009 (and certainly much further back), they are not sticking around to see what happens.

Shorting Stocks On These POMO Days Will Be Frowned Upon By The Fed

Submitted by Tyler Durden on 07/31/2013 - 15:09

While 'tentative', the Fed's POMO schedule for August signals no Taper anytime soon. But, the Fed has generously 'allowed' 4 days for the shorting of stocks in August (Friday 2nd, Friday 9th, Wednesday 21st, and Friday 30th). Away from those days - BTFATH...

Forget The FOMC, Here Is Hilsenrath

Submitted by Tyler Durden on 07/31/2013 - 14:41

Anyone, or rather any vacuum tube algo, hoping that Fed mouthpiece Jon Hilsenrath's traditional post mortem would be kind enough and summarize the FOMC with a simple one or at most two-word phrase ("Buy" or "Superstrong Buy") will be disappointed. At best, the following summary can be summarized as "Neutral", or "Cautiously Non-committal", although as he correctly points out "Modest" is worse than "Moderate" as most recall from elementary school - it is unclear if this news is horrible enough to send the S&P to record highs.

Algorithmic Knee Jerk To FOMC Signals Vacuum Tube Confusion

Submitted by Tyler Durden on 07/31/2013 - 14:37

The usual schizophrenic reactions across asset classes are progressing but with 30 minutes down, it appears bonds are benefitting most (10Y -5bps), gold is up modestly (+$10 at $1320), and the USD down small after swinging both ways already. Stocks are the most 'confused' but just as they tumbled on the realization that the taper is not only still on the table but coming, a rumor spread like wildfire that Hilsenrath was about to provide the much needed "Strong Buy" interpretation of the virtually unchanged from June FOMC statement.

Fed Releases Broken Record: "Prepared To Increase Or Reduce QE", No Taper Mention - Full Redline Comparison

Submitted by Tyler Durden on 07/31/2013 - 14:04

The FOMC appears to have 'tweaked' its message to fit with Bernanke's confusing commentary and confirms that 'tapering is not tightening'.

FED SAYS INFLATION 'PERSISTENTLY' BELOW 2% GOAL COULD POSE RISK

FED SAYS ECONOMIC GROWTH WILL PICK UP FROM RECENT PACE

FED REPEATS RATES 'EXCEPTIONALLY LOW' UNTIL JOBLESS AT 6.5%

FED SAYS UNEMPLOYMENT WILL GRADUALLY DECLINE

FED SAYS 'DOWNSIDE RISKS' DIMINISHED 'SINCE THE FALL'

FED NOTES THAT MORTGAGE RATES HAVE RISEN SOMEWHAT

FED SAYS IT IS PREPARED TO INCREASE OR REDUCE THE PACE OF PURCHASES

Bullard no longer dissenting, George is sole dissenter. And don't forget, of course, that this is all pretense in the face of the inevitability of the taper due to refunding, political, and technical reasons. As we noted earlier, it seems preferable to pretend the economy is strong enough to withstand less-easing (tightening) than admit the Fed is cornered.

Pre: S&P Futs 1685, 10Y 2.65%, USD Index 81.80, WTI $104.65, Gold $1311

Redline to follow

The Most Important Number In The Entire U.S. Economy

There is one vitally important number that everyone needs to be watching right now, and it doesn't have anything to do with unemployment, inflation or housing.  If this number gets too high, it will collapse the entire U.S. financial system.  The number that I am talking about is the yield on 10 year U.S. Treasuries.  When that number goes up, long-term interest rates all across the financial system start increasing.  When long-term interest rates rise, it becomes more expensive for the federal government to borrow money, it becomes more expensive for state and local governments to borrow money, existing bonds lose value and bond investors lose a lot of money, mortgage rates go up and monthly payments on new mortgages rise, and interest rates throughout the entire economy go up and this causes economic activity to slow down.  On top of everything else, there are more than 440 trillion dollars worth of interest rate derivatives sitting out there, and rapidly rising interest rates could cause that gigantic time bomb to go off and implode our entire financial system.  We are living in the midst of the greatest debt bubble in the history of the world, and the only way that the game can continue is for interest rates to stay super low.  Unfortunately, the yield on 10 year U.S. Treasuries has started to rise, and many experts are projecting that it is going to continue to rise. (Read More....) On August 2nd of last year, the yield on 10 year U.S. Treasuries was just 1.48%, and our entire debt-based economy was basking in the glow of ultra-low interest rates.  But now things are rapidly changing.  On Wednesday, the yield on 10 year U.S. Treasuries hit 2.70% before falling back to 2.58% on "good news" from the Federal Reserve.

Historically speaking, rates are still super low, but what is alarming is that it looks like we hit a "bottom" last year and that interest rates are only going to go up from here.  In fact, according to CNBC many experts believe that we will soon be pushing up toward the 3 percent mark...

Round numbers like 1,700 on the S&P 500 are well and good, but savvy traders have their minds on another integer: 2.75 percent

That was the high for the 10-year yield this year, and traders say yields are bound to go back to that level. The one overhanging question is how stocks will react when they see that number.

"If we start to push up to new highs on the 10-year yield so that's the 2.75 level—I think you'd probably see a bit of anxiety creep back into the marketplace," Bank of America Merrill Lynch's head of global technical strategy, MacNeil Curry, told "Futures Now" on Tuesday.

And Curry sees yields getting back to that level in the short term, and then some. "In the next couple of weeks to two months or so I think we've got a push coming up to the 2.85, 2.95 zone," he said.

This rise in interest rates has been expected for a very long time - it is just that nobody knew exactly when it would happen.  Now that it has begun, nobody is quite sure how high interest rates will eventually go.  For some very interesting technical analysis, I encourage everyone to check out an article by Peter Brandt that you can find right here.

And all of this is very bad news for stocks.  The chart below was created by Chartist Friend from Pittsburgh, and it shows that stock prices have generally risen as the yield on 10 year U.S. Treasuries has steadily declined over the past 30 years...

When interest rates go down, that spurs economic activity, and that is good for stock prices.

So when interest rates start going up rapidly, that is not a good thing for the stock market at all.

The Federal Reserve has tried to keep long-term interest rates down by wildly printing money and buying bonds, and even the suggestion that the Fed may eventually "taper" quantitative easing caused the yield on 10 year U.S. Treasuries to absolutely soar a few weeks ago.

So the Fed has backed off on the "taper" talk for now, but what happens if the yield on 10 year U.S. Treasuries continues to rise even with the wild money printing that the Fed has been doing?

At that point, the Fed would begin to totally lose control over the situation.  And if that happens, Bill Fleckenstein told King World News the other day that he believes that we could see the stock market suddenly plunge by 25 percent...

Let’s say Ben (Bernanke) comes out tomorrow and says, ‘We are not going to taper.’ But let’s just say the bond market trades down anyway, and the next thing you know we go through the recent highs and a month from now the 10-Year is at 3%. And people start to realize they are not even tapering and the bond market is backed up....

They will say, ‘Why is this happening?’ Then they may realize the bond market is discounting the inflation we already have.

At some point the bond markets are going to say, ‘We are not comfortable with these policies.’ Obviously you can’t print money forever or no emerging country would ever have gone broke. So the bond market starts to back up and the economy gets worse than it is now because rates are rising. So the Fed says, ‘We can’t have this,’ and they decide to print more (money) and the bond market backs up (even more).

All of the sudden it becomes clear that money printing not only isn’t the solution, but it’s the problem. Well, with rates going from where they are to 3%+ on the 10-Year, one of these days the S&P futures are going to get destroyed. And if the computers ever get loose on the downside the market could break 25% in three days.

And as I have written about previously, we have seen a huge spike in margin debt in recent months, and this could make it even easier for a stock market collapse to happen.  A recent note from Deutsche Bank explained precisely why margin debt is so dangerous...

Margin debt can be described as a tool used by stock speculators to borrow money from brokerages to buy more stock than they could otherwise afford on their own. These loans are collateralized by stock holdings, so when the market goes south, investors are either required to inject more cash/assets or become forced to sell immediately to pay off their loans – sometimes leading to mass pullouts or crashes.

But of much greater concern than a stock market crash is the 441 trillion dollar interest rate derivatives bubble that could implode if interest rates continue to rise rapidly.

Deutsche Bank is the largest bank in Europe, and at this point they have 55.6 trillion euros of total exposure to derivatives.

But the GDP of the entire nation of Germany is only about 2.7 trillion euros for a whole year.

We are facing a similar situation in the United States.  Our GDP for 2013 will be somewhere between 15 and 16 trillion dollars, but many of our big banks have exposure to derivatives that absolutely dwarfs our GDP.  The following numbers come from one of my previous articles entitled "The Coming Derivatives Panic That Will Destroy Global Financial Markets"...

JPMorgan Chase

Total Assets: $1,812,837,000,000 (just over 1.8 trillion dollars)

Total Exposure To Derivatives: $69,238,349,000,000 (more than 69 trillion dollars)

Citibank

Total Assets: $1,347,841,000,000 (a bit more than 1.3 trillion dollars)

Total Exposure To Derivatives: $52,150,970,000,000 (more than 52 trillion dollars)

Bank Of America

Total Assets: $1,445,093,000,000 (a bit more than 1.4 trillion dollars)

Total Exposure To Derivatives: $44,405,372,000,000 (more than 44 trillion dollars)

Goldman Sachs

Total Assets: $114,693,000,000 (a bit more than 114 billion dollars - yes, you read that correctly)

Total Exposure To Derivatives: $41,580,395,000,000 (more than 41 trillion dollars)

That means that the total exposure that Goldman Sachs has to derivatives contracts is more than 362 times greater than their total assets.

And remember, the biggest chunk of those derivatives contracts is made up of interest rate derivatives.

Just imagine what would happen if a life insurance company wrote millions upon millions of life insurance contracts and then everyone suddenly died.

What would happen to that life insurance company?

It would go completely broke of course.

Well, that is what our major banks are facing today.

They have written trillions upon trillions of dollars worth of interest rate derivatives contracts, and they are betting that interest rates will not go up rapidly.

But what if they do?

And the truth is that interest rates have a whole lot of room to go up.  The chart below shows how the yield on 10 year U.S. Treasuries has moved over the past couple of decades...

As you can see, the yield on 10 year U.S. Treasuries was hovering around the 6 percent mark back in the year 2000.

Back in 1990, the yield on 10 year U.S. Treasuries hovered between 8 and 9 percent.

If we return to "normal" levels, our financial system will implode.  There is no way that our debt-addicted system would be able to handle it.

So watch the yield on 10 year U.S. Treasuries very carefully.  It is the most important number in the entire U.S. economy.

If that number gets too high, the game is over.

Why Are The Chinese Gobbling Up Real Estate And Businesses In Detroit?

Something very strange is happening to Detroit.  Once upon a time, it was the center of American manufacturing and it had the highest per capita income in the United States.  But now the city is dying and the Chinese are moving in to pick up the pieces.  Lured by news stories that proclaim that you can buy homes in Detroit for as little as one dollar, Chinese investors are eagerly gobbling up properties.  In some cases, this is happening dozens of properties at a time.  Not only that, according to the New York Times “dozes of companies from China” are investing in businesses and establishing a presence in the Detroit area.  If this continues, will Detroit eventually become a city that is heavily dominated by China? (Read More.....)

Has An Ancient Giant Handprint Been Found In A Cave In Nevada?

Something really weird has been found on the wall of a cave in Nevada, and it is shaking a lot of people up.  Two paranormal investigators named MK Davis and Don Monroe claim to have stumbled upon the handprint of an ancient giant in Lovelock Cave, and the pictures that have been released to the public are absolutely startling.  If this handprint is real, it is estimated that it would have belonged to someone 18 feet all.  And what makes all of this even more compelling is that there is a very old Native American tradition that says that a tribe of red-haired giants was burned inside that cave a very long time ago.  So could we actually be looking at solid evidence that the old Native American tradition about the red-haired giants is actually real?

There has been a tremendous amount of interest in this particular cave going all the way back to 1911.  At that time, two guano miners claimed that they discovered several sets of giant bones inside the cave…

In 1911 David Pugh and James Hart, two guano miners (yes, mining bat poo is really a thing) (Read More....)

July 30th, 2013 | Tags: Ancient Giant, Giant Finger, Giant Footprint, Giants, Michael T. Snyder, Paranormal Discoveries, Red-Haired Giants, Weird | Category: Nephilim | 5 comments

Is Our Sun In The Very Early Stages Of Shutting Down?

Something is up with the sun.  It has begun to behave very erratically, and scientists don’t know quite what to make of it.  Sunspot activity appears to be slowing down with each new cycle and absolutely gigantic holes have started to appear in the sun.  At the moment, the sun is approaching the peak of its 11 year cycle, and an increasing number of scientists are becoming concerned about what the next cycle will bring.  If sunspot activity continues to diminish, could the sunspot cycle eventually die altogether?  Is it possible that we could be approaching another ice age?  Even worse, could the increasingly erratic behavior of the sun be an indication that the sun is dying?  Traditionally, scientists have taught that the sun won’t die until billions of years from now, but in recent years astronomers have observed stars similar to our own sun suddenly begin to behave very erratically and then rapidly die.  Is it possible that the same thing could happen to our sun?

It is a fact that the current solar cycle has been the weakest in 100 years.  This has many scientists searching for answers…

The Sun is acting weird. It typically puts on a pageant of magnetic activity every 11 years for (Read More....)

July 29th, 2013 | Tags: Another Ice Age, Astronomy, Holes In The Sun, Michael T. Snyder, Scientists, Sunspot Activity, Sunspot Cycle, The Sun, The Sun Is Dying | Category: Earth Changes | 23 comments

20 Controversial Questions The Mainstream Media Won’t Touch With A Ten Foot Pole

Why are so many incredibly important news stories completely ignored by the mainstream media in the United States?  Why do they seem to want to avoid many “controversial questions” as if they were the plague?  Why does the media tend to label those that are willing to ask the hard questions and seek the truth as “conspiracy theorists”?  Sadly, the truth is that the mainstream media in America does not do much real journalism anymore.  At this point, approximately 90 percent of what you see on television is controlled by just 6 giant media corporations.  That is why “the news” seems to be so similar no matter what channel you watch.  Well, it turns out that a lot of Americans are getting tired of the safe, censored, pre-packaged news that they get from the corporate-controlled media.  One recent poll found that 77 percent of all Americans do not trust television news at this point.  This distrust has helped fuel the rise of the alternative media, which has absolutely exploded in (Read More....)

FOURNIER: What If Obama Can't Lead?

'Remarkable combination of arrogance, impotence'...

STILL PUMPING...

Inflation 'persistently' below target...

Commerce Dept revises economy numbers -- back to 1929...

NSA database tracks FACEBOOK chats...

TWITTER: Gov't Info Requests on the Rise...

Dog Chews Off Paralyzed Man's Testicle While He Sleeps...

VIDEO: Man Offers to Help Disabled Woman -- Then Chokes, Robs Her... { Yup…nigger kindness in action! }

Infowars Announces the Grand Prize Winner of Operation Paul Revere

Infowars.com | The Grand Prize winner of $100,000 is…

Top 20 Jokes of Weinergate

Adan Salazar | Weiner stands up despite criticism.

Court Rules Cops Don’t Need Warrant to Track Cell Phones

Kurt Nimmo | Supreme Court reluctant to rule on Fourth Amendment and new technologies.

Government Report: TSA Corruption, Misconduct Soaring

Steve Watson | Up 26% in three years; no consistency in disciplining thieves, molesters, and those neglecting security.

San Diego Mayor Sued by His Own City

Julie Wilson | San Diego Mayor asks City Council to pay his legal fees.

Social Security Administration Now Hiring for Counterintelligence Operations

Kit Daniels | SSA joining Dept. of Defense in efforts to downplay negative news and influence the public’s behavior.

Consumer alert: Most common vitamins, including children’s vitamins, found to contain GMOs

Mike Adams | Large number of multivitamins and nutrient vitamins formulated with ingredients derived from genetically modified corn.

Bank Of England Helped Reichsbank Sell Its Nazi Gold

Zero Hedge | Bank of England facilitated sale of gold looted by Nazis after invasion of Czechoslovakia in 1938.

Fed keeps stimulus going, leaves rates unchanged

Jeff Cox | Federal Reserve will keep interest rates unchanged and keep buying $85 billion in bonds every month.

10 Reasons the U.S. Economy Is Stuck

Moira Herbst | The reality is that we’re hollowing out the middle class.

Hawaii sets aside $100,000 to offer homeless people a one-way ticket home

The Daily Mail | Supporters hope to take some weight off an overburdened shelter system.

Dozens of CIA operatives on the ground during Benghazi attack...

ZDRAVSTVUJ!

Who Is Responsible For The Bizarre Cattle Mutilations That Are Happening All Over America?

All over the United States, cattle are being brutally mutilated and nobody seems to know who is doing it.  Hearts, udders, teets, ears, tongues and reproductive organs are being removed, and in most of these cases the cuts are made with surgical precision and no trace of blood is left behind at the scene.  Sometimes the mutilated cattle are left in the mud or in deep snow, but there are no footprints or any other signs that anyone had ever been there.  This phenomenon has been going on for many years, especially in the western half of the U.S., and yet authorities have no leads and absolutely no explanation for why this is happening.  Could it be possible that there is not a natural explanation for this unexplained mystery?

That is what one rancher out in Missouri thinks.  She has had several cattle mutilated over the past few years, and the latest incident that happened on her ranch got so much national attention that it even made the Drudge Report.

The mutilation of her cows fits the same pattern that we have seen all over America, and she is convinced that it could be the work of aliens.  The following is how (Read More....)

July 31st, 2013 | Tags: Aliens, Cattle Mutilation, Cattle Mutilations, Cow Mutilation, Michael T. Snyder, No Explanation | Category: Unexplained Mysteries | 4 comments

Has An Ancient Giant Handprint Been Found In A Cave In Nevada?

Something really weird has been found on the wall of a cave in Nevada, and it is shaking a lot of people up.  Two paranormal investigators named MK Davis and Don Monroe claim to have stumbled upon the handprint of an ancient giant in Lovelock Cave, and the pictures that have been released to the public are absolutely startling.  If this handprint is real, it is estimated that it would have belonged to someone 18 feet all.  And what makes all of this even more compelling is that there is a very old Native American tradition that says that a tribe of red-haired giants was burned inside that cave a very long time ago.  So could we actually be looking at solid evidence that the old Native American tradition about the red-haired giants is actually real?

There has been a tremendous amount of interest in this particular cave going all the way back to 1911.  At that time, two guano miners claimed that they discovered several sets of giant bones inside the cave…

In 1911 David Pugh and James Hart, two guano miners (yes, mining bat poo is really a thing) (Read More....)

July 30th, 2013 | Tags: Ancient Giant, Giant Finger, Giant Footprint, Giants, Michael T. Snyder, Paranormal Discoveries, Red-Haired Giants, Weird | Category: Nephilim | 9 comments

Is Our Sun In The Very Early Stages Of Shutting Down?

Something is up with the sun.  It has begun to behave very erratically, and scientists don’t know quite what to make of it.  Sunspot activity appears to be slowing down with each new cycle and absolutely gigantic holes have started to appear in the sun.  At the moment, the sun is approaching the peak of its 11 year cycle, and an increasing number of scientists are becoming concerned about what the next cycle will bring.  If sunspot activity continues to diminish, could the sunspot cycle eventually die altogether?  Is it possible that we could be approaching another ice age?  Even worse, could the increasingly erratic behavior of the sun be an indication that the sun is dying?  Traditionally, scientists have taught that the sun won’t die until billions of years from now, but in recent years astronomers have observed stars similar to our own sun suddenly begin to behave very erratically and then rapidly die.  Is it possible that the same thing could happen to our sun?

It is a fact that the current solar cycle has been the weakest in 100 years.  This has many scientists searching for answers…

NSA PAYS BRIT SPIES