This is the simplest argument we’ve seen for leaving the Euro

There are loads of good arguments out there for why Greece (or Italy, or Spain, or Portugal) should leave the Euro.  We’ve always been partial to the basic philosophical truth that monetary policy lies at the core of national sovereignty. No nation is sovereign if they can’t set monetary policy. And then we saw this chart (from the […]

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China markets get obliterated. This is why you need to pay attention.

It’s been an ugly week for Chinese equities, but today’s performance is a whole other level of ugly: Today marked the fourth largest decline of the Shanghai Composite in two decades. We’ve discussed the insane valuations on the Shanghai and Shenzen stock-exchange before. As our regular readers will know, today’s fireworks have been a long time in […]

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Why do we survey economists’ opinions when the majority are wrong?

When it comes to the question of when (and if) the Federal Reserve will raise interest rates, we’re not really sure why the media continues to report on “what economists think“.   It’s clear to anyone who is paying attention that economists are not good at making predictions, and that the consensus of economists has been consistently wrong after […]

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Is Deutsche Bank the next Lehman?

Looking back at the Lehman Brothers collapse of 2008, it’s amazing how quickly it all happened.  In hindsight there were a few early-warning signs,  but the true scale of the disaster publicly unfolded only in the final moments before it became apparent that Lehman was doomed. First, for purposes of drawing a parallel, let’s re-cap the events of […]

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Oops! Philly Fed Admits QE widens inequality

Once again, the Federal Reserve proves that it’s the last one to know everything that we knew already.   Today’s stunning announcement:  The Philadelphia Fed admits they (“may have”) made the wealthy wealthier and Main Street poorer. Oops.  Sorry America. The Philly Fed insists that “redistributing wealth” to the wealthy isn’t the main idea, but just a potential side […]

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The Financial Singularity Cometh

More than two millennia ago Plutarch wrote these simple words:  “An imbalance between rich and poor is the oldest and most fatal ailment of all republics”. The real zinger of a word there is “fatal“. History has shown us time and again that a nation can not and will not survive once the disparity between rich and poor passes a […]

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China’s equity bubble is going supernova

A supernova is a stellar explosion that is so bright it momentarily outshines the entire galaxy. The most massive supernovae are caused by stars which collapse under their own gravity, sending massive shockwaves radiating outwards into space.   Any onlooker happening to see a supernova might be forgiven for thinking that these super-bright objects are the most awesome stars in the sky […]

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Monetary Apocalypse Now: Venezuela

While the world watches Greece’s economy approach the cliff-edge, and Europe’s banking elite employ more and more desperate accounting tricks to magically conjure Eurozone solvency – we would like to point our readers’ attention to Venezuela, which provides a useful illustration of what happens to all fiat currencies on a long enough timeframe. The Venezuelan bolivar is […]

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Breach shows government can’t protect data. But FBI wants to abolish encryption anyway.

By now, everyone has heard that the US government was “hacked” by Chinese hackers who may or may not have been affiliated with the Chinese government.   President Obama wasted little time in stirring up the hornet’s nest by pointing the finger at the Chinese premier and demanding that China take responsibility for the breach.  The […]

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Fed just said it will raise rates when economy of the WORLD improves.

The greatest disconnect in the world today must be the vast chasm between what the Federal Reserve “thinks we think” and what the rest of us “actually think”. What the Fed “thinks we think” is that there’s some significant possibility that they will raise rates sometime soon. What we “actually think” is that any meaningful hike in rates will instantly […]

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Never go full retard: Bloomberg calls for “helicopter money”

Clive Crook, a member of Bloomberg View’s editorial board, has gone where the sensible have long feared to tread.  In today’s Bloomberg View, he recommends stimulating the economy by just giving everyone free money. Crook also may have set a Bloomberg View record for getting everything so wrong, so quickly.   By his third sentence Clive is clearly lost. […]

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Awesome: WikiLeaks crowd-sources $100,000 bounty for TPP information

Today WikiLeaks launched a crowd-sourcing campaign to raise a $100,000 reward for some of the world’s deepest secrets: The remaining 26 never-before-seen chapters of the TPP. WikiLeaks has already published three chapters from this top-secret, closed-door deal,  but 26 chapters have never been seen by anyone other than insiders.     The new crowd-sourcing campaign is the first example […]

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Stanley Fischer’s statement of the obvious: “Bankers should be punished for financial crimes”

Federal Reserve vice chairman Stanley Fischer’s speech yesterday met with disbelief and snickers when he announced that those who commit financial crimes should “suffer”. So where was Mr. Fischer back before the statute of limitations on the largest crimes ran out? Of course, we know. He was busily destroying the US economy with a deadly cocktail of unproven, fringe economic […]

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Government attempts to regulate Bitcoin. Government will fail.

The news that New York State’s top financial regulator has announced the first-ever set of regulations for firms doing business in the BitCoin space shows just how deep the government misunderstanding of BitCoin goes. On Thursday, Benjamin M. Lawsky, the superintendent of financial services, announced proposed regulations for virtual currency companies operating in New York. […]

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Nigel Farage: “It’s like good old Soviet times!” — Must Watch!

For those who haven’t yet seen Nigel Farage’s latest rant against the absurdity of European “democracy”, this is classic Farage.   Please watch and pass this on! Partial Nigel Farage transcript European Parliament, Strasbourg, July 15, 2014 as transcribed by NotQuant: “If this is European democracy in action this morning, I suggest we have a re-think” […]

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Will there be an epic (final) US Dollar rally?

When large ships first begin sinking, they tend to sink evenly.  The lowest part of the hull, or bilge,  fills with water increasing the weight of the ship and pulling the entire ship down evenly.  Then as the water-level reaches successively higher decks, the rushing water often causes an increase in weight towards the bow or the stern. The increased weight […]

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