Free Republic

EL-ERIAN: The Fed Better Be Right About The Economy Mohamed El-Erian, ContributorJune 20, 2013REUTERS/Frank Polich Virtually every segment of the fixed income, equity and commodity markets sold off viciously this afternoon on the back of the Fed statement and Chairman Ben Bernanke’s subsequent remarks. In the process, liquidity evaporated in certain places causing even more disorderly price moves. The immediate trigger for this afternoon’s market debacle was heightened concern that the Fed intends to reduce its support of the economy, undermining the markets’ notion of the “central bank put.” And in reacting to signs that the Fed may gradually take...

Bernanke just now during his post-FED Meeting presser: "Between 5% and 6% unemployment is what we consider to be "Full Employment"". Remember when Nancy Pelosi and the TV told you that 4.3% Unemployment (1.8% in Indiana at the time) was "THE WORST ECONOMY SINCE THE GREAT DEPRESSION!!!" under Bush?

This article excerpts from a report called Measure for America, which created an index for well being in the 50 states and major metro areas. It leads with the fact that "red states" run by Republicans still score low on the index, and points out one non-shocker to Freepers: the city with the highest gains on the index in terms of rising incomes, education levels and healthcare? Guess...

A Democrat, A Union, And Myriad Businesses See Chaos In Obamacare The Daily ReckoningDustin Hurst June 19, 2013. Perhaps the question is no longer if Obamacare will wreak havoc on the American economy. Instead, the query seems to have morphed into something far more dire and prophetic: Just how much chaos will the law inflict upon the American people, businesses, and the economy? Many wonder, too, if the law will actually improve the country’s health care system. The law is having a rough spring, with criticism coming from its own architect, job creators worried about health care mandates, and science...

Reasons Why U.S. Housing Market Recovery Is Genuine Housing-Market / US Housing Jun 19, 2013 - 07:39 PM GMTGary Gately By: Money Morning Gary Gately writes: The housing market recovery is for real this time. Coming after the housing market crash, the recovery is welcome news to those in the industry - and bodes well for the economy as a whole. "It almost seems too good to be true," Lawrence Yun, the chief economist at the National Association of Realtors, told Money Morning. The latest confirmation of the market's rebound is the new survey of home builder confidence from Wells...

Federal Reserve officials both expect and want inflation to be higher than it is. So far, that isn’t happening. Consumer price data released Tuesday showed inflation rose a mere 1.4% in May from a year earlier. While the consumer price index isn’t the Fed’s preferred inflation measure — the personal consumption expenditures price index is — the reading is a reminder that price gains are still well below the central bank’s 2% target. Economists at Macroeconomic Advisers say the CPI rise likely translates to an annualized gain of 0.7% in the second quarter — a very weak reading.

You’d think when the Huffington Post’s top writer on finance writes about the tax code, he’d understand at least how the tax code works. But in an age when “finance” editors, like the HuffPo’s Mark Gongloff, are demonstrably anti-business, pro-Occupy and work as shills for progressive ideas, facts take a back seat to ideology, outrage and agendas. The latest outrage Gongloff has taken issue with is how little of the U.S. tax revenue, on a percentage basis, is generated by corporate taxes, as opposed to the good old days of the 1950s. He even has a chart to prove it...

One hundred and fifty years after twin defeats at Gettysburg and Vicksburg destroyed the South’s quest for independence, the region is again on the rise. People and jobs are flowing there, and Northerners are perplexed by the resurgence of America’s home of the ignorant, the obese, the prejudiced and exploited, the religious and the undereducated. Responding to new census data showing the Lone Star State is now home to eight of America’s 15 fastest-growing cities, Gawker asked: “What is it that makes Texas so attractive? Is it the prisons? The racism? The deadly weather? The deadly animals? The deadly crime?...

Hassan Rohani, Iran's new President, is being termed a “moderate” in Western media, but it appears that his moderation stops when it comes to Israel. In his first speech as Iran's new leader, Rohani quickly launched into a diatribe against Israel, blaming the Jewish state for Iran's economic problems. Those problems largely have their roots in the sanctions imposed by the West on Iran, the result of the previous government's refusal to allow international inspectors into some of its nuclear facilities, and its insistence at enriching uranium at a level that would allow Tehran to build nuclear weapons. Western countries...

Not so long ago, the Congressional Budget Office (CBO) said it expected the U.S. government to register a budget deficit in the current fiscal year of $642 billion. But hold on a minute… The budget deficit so far (as of May 31, 2013) has already hit $626.3 billion, and we still have four more months to go in the government’s current fiscal year!

Global Recession Forecast - Is PIMCO's Bill Gross Wrong Again? Stock-Markets / Financial Markets 2013 June 17, 2013 - 05:01 PM GMT By: Money Morning Keith Fitz-Gerald writes: Stuart Varney put the question directly to me last week during his Fox Business show: What do I make of comments from PIMCO's Bill Gross...that he's projecting a 60% chance of a global recession in the next three to five years? Now, Bill Gross is obviously one of the most powerful men in the world. PIMCO, the firm he founded, is the world's biggest bond manager. He has assets under management of...

Yes, At Some Point China Will Implode Henry BlodgetJune 17,2013 If there has been one prediction made more than any other over the past couple of decades, it's that China's miraculous economy is headed for a fall. China bears have pointed to a long list of disasters-in-the-making, from questionable economic statistics to skyrocketing real-estate prices to ghost cities to centrally planned growth to corruption to pollution to civil unrest to debt. And yet, despite all of these concerns, China's economic machine has just kept chugging along. But this time it's going to be different!, says an analyst from Fitch. This...

Until someone else takes this over, this is the Daily investment & finance thread (6-11-13 edition) ----   Trying to focus on the markets for today and each day and the economic news This is where you can exchange some investment opinions and advice  If you see another FR economic thread you like and want to link to it here, please do Post your favorite economic site links. Your favorite economic blogs and precious metals blogs and sitesPing list -- on or off let me know here or via freep-mail. If I missed you then Freep-mail me I might ping you to...

Congress is currently convulsed in a titanic struggle over immigration reform… a topic that rarely cracks the top-10 list of top concerns for the American people, and never gets into the top 5. Border security polls far higher than anything else in the “comprehensive immigration reform” basket, particularly among those Americans who actually live along the border, but that’s the one thing the ruling class most certainly does not care about. The Senate just gunned down a resolution to put border security first. The gap between the ruling class agenda, and the things most Americans really care about, has never...

•Palin would not have dismissed the Black Panther intimidation lawsuit that the government had already won. •Palin would not have seized two auto companies and give them to her cronies in and out of the UAW. •Palin and her supporters would not be claiming that her opponents were racists for disagreeing with her policies. •Palin would not have tried to block Boeing from building a factory in South Carolina as a gift to her union buddies in Washington state. •Palin would not have toured the world apologizing for America. If Palin Were President •Palin’s Homeland Security Department would not have...

Paul Krugman has a column today on a topic you don't normally get much of from economists: sympathy for the Luddites. Back in 2001, when I sat in on my last formal economics class, this was about as daring a proposition as "Sympathy for the Devil" was as an album title. ---snip--- But I have started worrying about what's taking place at the bottom of the economy. In much of the industrial world, it seems to be increasingly difficult for people to earn a decent living without a fairly elite set of skills--or an elite set of credentials that mimic...

ModMark wrote: One of the coal plants shut down in Chicago was built ~90 years ago. While upgraded in the 1950's. it still did not meet EPA standards before Obama was elected. These plants were grandfather in when the clean air act was past. These ancient relics should have been converted to natural gas long ago.Do you really want to live next to one of these ancient plants? –in response to Obama Promise Kept: Coal Plants to go Bankrupt with New EPA Carbon Cap Dear Comrade Mark, The building was built 90 years ago, but the actual power plant generating electricity is considerably...

The Gang of Eight’s immigration bill is nothing less than a frontal assault on America’s already-struggling blue collar population. Forget border security–the bill would be an abomination even if it could magically guarantee that upon passage, not a single person would ever again cross the border illegally. The bill is a disaster because of the legal immigration it will authorize, estimated at somewhere between 30 million and 57 million above current levels over the next ten years. And these new legal immigrants will be overwhelmingly–like, 90%–low-skilled and low-wage. What will that do to the employment prospects and wages–if they’re lucky...

The Mortgage Refinancing Boom Is Evaporating Before Our Eyes Mamta Badkar and Matthew Boesler June 14, 2013, 1:29 PM Mortgage rates have been climbing for five straight weeks, and the latest data from the Mortgage Banker's Association shows that the average 30-year fixed rate is now at 4.15%, up from 3.59% in the first week of May. Meanwhile, the MBA's refinancings index is down 36% from its peak at the beginning of May. The rise in mortgage rates has been driven by concerns about when the Federal Reserve will begin to slow its $85-billion-a-month bond purchase program, which is designed...

JIM O'NEILL: We Could See A Bond Crash Steven Perlberg Jun. 14, 2013, 12:33 PM As the market speculates on when the Fed will begin to slow its quantitative easing program, former Goldman Sachs Asset Management chairman Jim O'Neill isn't alone in believing a taper would mean turbulence for financial markets. But for O'Neill, it would also "not be a stretch" to see 5% yields on the 10-year Treasury, reports Bloomberg. Given the 10-year's current 2.11% yield, that would imply a big sell-off in the bond market. O'Neill talked about that — and his prediction for a bond crash —...

MADISON — Secretary of State Doug La Follette wants his fellow Democrats to quit bashing the Wisconsin Economic Development Corp. It appears that La Follette’s plea went unheard, as three senate Democrats on Wednesday called for a criminal investigation into the state’s main business subsidy agency. “In some cases, the violations of state statute that took place appear to have risen to the level of criminal offenses,” Democrat state Sens. Bob Wirch of Somers, Dave Hansen of Green Bay and Jon Erpenbach of Middleton wrote in a letter to Dane County District Attorney Ismael Ozanne. “We ask that you investigate...

The Nikkei Is Set To Surge When It Opens �Matthew Boesler Jun. 13, 2013, 4:16 PM Thursday, the Japanese Nikkei 225 stock index crashed 6.4% (down a whopping 844 points to 12,445). Nikkei futures have been rallying all day long, though – as U.S. stocks have advanced – and are currently trading at 13,080, up 635 points already from Thursday's close. That implies a 5.1% surge when the Nikkei re-opens Friday in Japan. Why is the Japanese stock market so volatile? WSJ chalks it up to day trading, which has surged in popularity as the market has stage a wild...

President Obama and his family will be going to Africa later this month. But the trip won't be cheap; it's expected to cost American taxpayers $60 to $100 million, according to the (The Washington Post) "When President Obama makes his first extended trip to sub-Saharan Africa later this month, the federal agencies charged with keeping him safe won’t be taking any chances. Hundreds of U.S. Secret Service agents will be dispatched to secure facilities in Senegal, South Africa and Tanzania. A Navy aircraft carrier or amphibious ship, with a fully staffed medical trauma center, will be stationed offshore in case...

FELIX ZULAUF: Japan Will Cause The Next Big Global Crisis Steven Perlberg June 13, 2013, 11:11 AM For weeks, Japan's stock market has been in an absolute freefall. Last night the Nikkei fell to 12,445, down 6.4%. But it wasn't long ago that commentators were rejoicing in Abenomics – the policy moniker for Japan's monetary stimulus and government spending plan – for its bold three-pronged approach to juice the Japanese economy. Now, with the Nikkei taking a turn for the worse and the yen strengthening, it appears Abenomics has not had the intended effect. Felix Zulauf, swiss hedge fund manager...

The U.S. jobs picture is bleaker than the most recent jobs reports may make you think. The economy added 175,000 jobs last month, but at the rate things are going, it would take almost a decade to get back to prerecession employment levels. A Job Openings and Labor Turnover Survey report released Tuesday by the Bureau of Labor Statistics digs in on the bad news: The number of job openings in the U.S. actually fell by 118,000 in April to 3.8 million.How bad can 3.8 million job openings be? The Economic Policy Institute looks at the number and sees that "the...

A Bit Of A Global Bloodbath Is Happening In Markets, And Here's What Traders Are Talking About Joe Weisenthal June 13,2013 Dave Lutz of Stifel, Nicolaus passes along the top topics about which he is chatting with clients this morning. As he puts it, there is a "bit of a bloodbath" in global markets today. Morning, a bit of a bloodbath in Global markets, but US futures have recovered from their lows thus far – Like yesterday, the SPX Futures are outperforming Japan and Europe – Losing only 30bp, but trading under the 50dma – a first since April. DAX...

The Obama administration is facing scandals everywhere -- using the IRS to punish political enemies, seizing the phone records of Associated Press and Fox News reporters, monitoring phone and email accounts of millions, and making up stories about what happened in Benghazi. In other words, the sort of government overreach that hardly raises eyebrows in Russia, China and most of Africa and Latin America is felonious here in the most free society in the world. Because of America's unique Constitution, and especially the Bill of Rights, for over two centuries Americans have taken as their birthright privacy and free expression,...

JAPAN IS CRASHING Joe Weisenthal Jun. 12, 2013, 9:36 PMKAPOW! Japan is crashing again. Earlier the Nikkei was down 5%. Now it's down over 6%. USDJPY (the dollar against the yen) is down to 95, which indicates significant yen strengthening. Not only is this a remarkable turn events for the Japanese market, but the long Nikkei/short yen trade has been one of THE trades of 2013 so far, so this is a brutal kick in the ass for hedge funds and speculators. And it's clear the bloom is coming off the rose for Abenomics (to some extent) the monetary stimulus...

STOCKS TUMBLE AGAIN: Here's What You Need To Know Matthew BoeslerJune 12, 2013 No economic data in the United States today, but the market fell all day long. First, the scoreboard: • Dow Jones: 14,994.69, -127.33, (-0.84%) • S&P 500: 1,612.54, -13.59, (-0.84%) • Nasdaq: 3,400.43, -36.52, (-1.06%) And now, the top stories: • 10-year U.S. Treasury yields climbed 5 basis points to 2.24% today. The sell-off in the bond market is being driven by rising real interest rates, which in turn are being driven by the threat that the Federal Reserve could taper back monetary stimulus this year. •...

ANALYST: 'There Are So Many Dominoes Just Waiting To Topple That We’re No Longer Sure What To Watch' �Matthew BoeslerJune 12, 2013 The reverberations emanating from rising U.S. Treasury yields over the past several weeks are shaking financial markets around the world. Almost every government bond market – across both developed and emerging economies – is experiencing rising yields as U.S. Treasuries get cheaper, yield more, and thus become more attractive to global investors. At the same time, fears that the Federal Reserve may begin to taper back monetary stimulus – which have been driving the rise in Treasury yields...

India's Apollo Tyres Ltd (APLO.NS) agreed to buy U.S.-based Cooper Tire & Rubber Co (CTB.N) for about $2.5 billion in a deal that would make it the world's seventh-largest tire maker and reduce its dependence on a slowing Indian auto market. Apollo, which currently gets two-thirds of its revenue from India, will pay $35 per share, representing a premium of about 43 percent to Cooper's Tuesday close. The acquisition of Cooper, the world's 11th biggest tire company with annual sales of $4.2 billion, will give Apollo access to the U.S. market for replacement tires for cars and light and medium...

We aren’t communist? When the obvious is obvious, why is it that there are those who can’t seem to see the obvious? Strange metaphor is it not? That we in this nation have those who can’t see this obvious scenario that this nation is as communist as any that has ever been, or will ever be! Perhaps it’s our identification of what we use as the yard stick to measure what is a communist government? When we look at the definition of communism, it is obvious that it had never existed, will not ever exist, and cannot exist as it...

Watch Peter Schiff in 2006/2007 state that the stock market and housing Market were about to crash. Watch the so-called experts laugh at Peter Schiff while claiming that the housing and stock markets were going to rocket upwards. Among the "experts who laughed at Schiff were Art Laffer and Ben Stein. Laffer, Stein and the others were wrong. Very wrong. Peter Schiff was right. By the way, Schiff has predicted an economy and stock market crash in 2013.

Markets Turning Ugly: Yen Soars, Italy Tanks, Emerging Markets Get Hammered Again Joe Weisenthal June 11, 2013, 5:48 AM The day started off somewhat quietly, if negative in tone, for global markets. But things have gotten worse no matter where you look. The yen is strengthening violently, as dollar-yen falls below 97. This yen strengthening comes in the aftermath of a BOJ decision to remain on course, and not do anything new. That lead to a 1.5% decline in the Nikkei during normal trading, but since then futures have weakened further. Meanwhile, the emerging market rout continues apace, as markets...

Recovery: Liberals are apoplectic about "austerity," claiming that draconian spending cuts are killing jobs and economic growth. But it's President Obama's tax hikes, not spending restraint, that are hurting growth prospects. Everywhere you turn these days, liberals are bemoaning the harm caused by "austerity." The left-wing Center for American Progress claims spending cuts will cost 2 million jobs over the next seven years. The Brookings Institution says they've already cost 2 million. [snip] But researchers at the Federal Reserve Bank of San Francisco looked at the data and came to a completely different conclusion.

Following slight budget cuts and a stalemate on taxes, Standard and Poors has upgraded the outlook for United States debt from negative to stable. Thank goodness for gridlock. “The U.S. has a less than one-in-three likelihood of a downgrade in the ‘near term’ with the revision,” reports Bloomberg. “The New York-based company said it sees ‘tentative improvements,’ such as the deal politicians reached to resolve what became known as the fiscal cliff and through spending cuts in the Budget Control Act of 2011.” Just think what good would happen if the president and Congress actually got together on something? OK-...

Standard & Poor's on Monday removed the near-term threat of another credit rating downgrade for the United States by revising its outlook to stable from negative, citing an improved economic and fiscal outlook. The change effectively means there is less than a one-third chance of a downgrade in the next two years. Moody's Investors Service and Fitch Ratings give the U.S. credit their highest rating but both have negative outlooks.

Ron Paul: “It’s Going to Get Much, Much Worse” Adam Taggert June 10th, 2013 Peak Prosperity Editor’s Note: The deceit, the statistical machinations, and the reality of the situation is being realized by more and more Americans every day. The mainstream media may not be talking about the severe storm that’s coming our way, but it is undeniable. While some doubt that legitimacy of the analysis and information being made available through alternative media, here’s the view from one insider known to most Americans as an honest straight shooter who has a working knowledge of economics, history, and how our...

Silicon Valley is world-renowned for the Nobel Prize winners and MacArthur "geniuses" behind theoretical breakthroughs in science, technology, engineering and math. Less well-known are people like Patrick Pickerell, a high school dropout whose $10 million-a-year Pleasanton metal manufacturing company is powered by people with no university credentials but plenty of math and fix-it skills -- ingredients essential to innovation. A new report, "The Hidden STEM Economy," reveals that a university degree is not required for 27.5 percent of all jobs in the San Jose area in the fields of science, technology, engineering and math. The number is even higher --...

The New York Stock Exchange is the largest gambling casino in the world. It is a place little fish are constantly eaten up by bigger fish. The big players are willing participants in the growth and maintenance of Barack Obama’s Potemkin Village. No one intelligent enough to have their hands on a large amount of money can possibly be ignorant of the chicanery that makes the Stock Market LOOK like an accurate reflection of the health of our economy. Indeed they take their seats in Obama’s casino every day counting on the $80 Billion the Fed is creating out of...

This is no longer the old Happy Meal economy of the 1980s, making toys and sneakers.

Happy weekend to one and all. And now for something completely different. Or, not: ---snip--- OK, so the question is, what is the craziest, dumbest, most relentlessly idiotic, jaw-droppingly imbecilic thing ever said to you by a liberal? And I don't mean the usual "Obama is good", "Republicans are mean" LIV talking points, I'm talking about remarks that are just so full of weapons-grade stupid that you're left gasping for air like a gutted fish, completely speechless, and feeling like your head has been filled with Elmer's glue. Just how dumb can they get? Let's see what you've got. And...

MAULDIN: I'm So Sure Japan Is Screwed That I'm Converting My Mortgage Into Yen John Mauldin, Thoughts From The FrontlineJune 9, 2013, 9:30 AM Wikimedia Commons Banzai! Banzai! Banzai!I shot an Arrow into the air It fell to earth I know not where…. - Henry Wadsworth Longfellow As kids, not knowing that we were being politically incorrect on so many levels, we would shout “Geronimo!” when we were playing war or getting ready to do something reckless. (For those not familiar, Geronimo was a rather fearsome Apache chief who plagued Mexico and the American cavalry.) Sam Houston and his fellows...

BRIAN BELSKI: Big Investors Aren't Ready For What Could Be Coming Next Sam Ro Jun. 9, 2013, 8:07 AM BMO Capital's Brian Belski has increasingly sounded alarms as the stock market blew past his once-bullish targets. Belski reiterates his thesis that the big investors are only buying into this rally now because they've been missing out. He believes this will only make things worse for everyone else should things turn south in a big way. "[W]e continue to believe that most institutional investors are not prepared for a potential period of market weakness," wrote Belski. "Therefore, we believe investors should...

Barbara1247 wrote:  The Republicans have helped bring us to this sorry state of affairs. - How About More Scandal, Incompetence, Venality, Hubris, Vanity and Error to Start Dear Comrade 1247, You’re a liberal, so even when you are right- like you are now- it’s accidental. So as a public service, let me explain to you, in the simplest terms, what you got right, accidentally. Certainly the GOP has helped establish a track record of what might be the sorriest 25 years of governing in American history. But it’s because they have supported watered-down versions of the Democrat agenda. For every...

Chains such as Rent-a-Wheel and Rimco are seeing business boom. Many consumers pay double or triple the cost of buying and face aggressive repossession policies. When the tires on their Dodge Caravan had worn so thin that the steel belts were showing through, Don and Florence Cherry couldn't afford to buy a new set. So they decided to rent instead. The Rich Square, N.C., couple last September agreed to pay Rent-N-Roll $54.60 a month for 18 months in exchange for four basic Hankook tires. Over the life of the deal, that works out to $982, almost triple what the radials...

Hedge Funds Haven't Owned This Much Of The Stock Market Since Right Before The Crash In 2008 Matthew Boesler June 8, 2013, 3:27 PM Two interesting stats on hedge fund exposure to the market via BofA Merrill Lynch analysts Stephen Suttmeier, Jue Xiong, and MacNeil Curry: 1.In the first quarter of 2013, net exposure (the difference between long and short positions in stocks) rose to match the previous peak (made in the second quarter of 2007). 2.The percentage of the stock market (specifically, the Russell 2000 float) owned by hedge funds is now the highest since the second quarter of...

It's A Mistake To Worry About Inflation Kenneth Rogoff, Project Syndicate June 8, 2013, 3:30 PM CAMBRIDGE – The world’s major central banks continue to express concern about inflationary spillover from their recession-fighting efforts. That is a mistake. Weighed against the political, social, and economic risks of continued slow growth after a once-in-a-century financial crisis, a sustained burst of moderate inflation is not something to worry about. On the contrary, in most regions, it should be embraced. Perhaps the case for moderate inflation (say, 4-6% annually) is not so compelling as it was at the outset of the crisis, when...

On the first Friday of each month, the financial markets, the mainstream media, and, in fact, the whole world eagerly await the U.S. monthly jobs report.  Tony Slydini, Doug Henning, Ricky Jay, Warren and Annabelle, and even Harry Houdini (some of the greatest magicians of all-time, apologies to others), would be truly proud of the art of misdirection repeatedly achieved by the Bureau of Labor Statistics (BLS) and subsequently via the Obama administration.  In the 1970s, inflation was so rampant — created by the move to fiat currency while totally abandoning the gold standard — that instead of dealing with...

All Signs Suggest This Is The End Of The Stock Market Rally Comstock Partners June 7, 2013, 11:06 PM The recent return of high volatility to the stock market, bond market and currencies suggest the end of the rally that started in November and probably to the upsurge since the March 2009 bottom. As we stated in last week’s comment the market now appears to be entering a lose-lose situation where economic growth is bad since it forces the Fed to “taper’ its bond buying program, a move that investors, as they have most emphatically demonstrated this week, do not...