BELIEVABILITY TEST

Here's a smell test for you. Bank deposits, just how safe are they, especially after Cyprus?

The following quote is from Ollie Rehnquist, the EU Commissioner For Economic and Monetary Affairs and the Euro.

Read it and let us know if it passes the olfactory test. 

"But there is a very clear hierarchy, at first the shareholders, then possibly the unprotected investments and deposits. However, the limit of 84,890 pounds is sacred, deposits smaller than that are always safe."

You can read the full story here. http://www.zerohedge.com/contributed/2013-04-08/eu-says-bank-moneys-safe-after-threats-take-it-ireland-still-looks-next-conta

THE PRESIDENT'S IRONY

I have never come to this president's defense before.

And I seriously doubt if in this lifetime I ever will again. 

But some people, left and right, never tire of the PC nonsense. To begin with, the nation has bigger problems. And what the president said is a fact: the attorney general of California is an attractive lady. And so are many other hard working women in this country.

Does anyone really want a nation where all the female attorneys look like Gloria Allred? No offense intended, just a standard for comparison, like hamburger and filet mignon or Republican and Democrat or liberal and uber-liberal.

 In the last few years television has more than a handful of attractive female attorneys spouting legalese into the tube. Just about every network has at least one. Though the television executives on the left or right won't admit it, that's at least one of the reasons they're there.

And how about most of those attractive female and male television anchor people around the country? That just happens by chance? Attractive sells. It's in the human genetic code. And all the king's horses and all the king's men ain't going to issue an estoppel certificate. Though one knows lots of folks would like to.

And about those attractive male anchors, are we to believe every female who watches tuned in strictly for the news?  Truth is women chatter about men's butts, maybe not anywhere to the degree men focus on female anatomy. But it's a fact, one mostly likely in their female DNA.

How many does it take to establish a fact, 5 of 10, 8 or 9 of 10? Do what psychologists and other study-lovers love to do, slip in an unnamed photo of the California Attorney General with several other photos of females and take a survey from both women and men. 

How many women watch George Clooney movies strictly to see his acting skills? Not too long ago a national tv commercial ran of a guy wearing a particular brand of blue jeans walking down the street with several girls ogling as he went past. 

Though the commercial didn't say it, the implied message did. He looked good in those jeans and jeans are about butts. Just ask any woman.

If there's a real irony here and there is one: the president gets caught up in the PC nonsense he and his party are most responsible for foisting on society.

THE FEEL GOOD NUMBERS

Here's another one of those great quotes, this time from a story about last week's pitiful new job numbers.

The Labor Department revises the numbers at least twice after they're initially released. Of course there are numerous reasons or excuses, some might say.

Yet frequent revisions to employment data suggest investors shouldn’t put too much faith in any one report. In the last 26 months extending to the start of 2011, the government has revised 19 monthly jobs reports to show bigger gains than initially reported. In some cases, job creation turned out to be much higher.

It's difficult to keep a straight face, but we'll try. The suggestion we shouldn't put too much faith in any one report is a misprint. It should read: investors shouldn't put much faith in any report.

Nineteen revisions, all of them upwards, in the last 26 months.

That's nearly 75% revision rate, again all upwards. Any hidden messages in there? Those are the kind of numbers most of us would love to have in Vegas, winning 75% of the time.

http://blogs.marketwatch.com/thetell/2013/04/05/was-job-growth-in-march-really-that-weak-well-know-in-a-year/

MONDAY READS

The Week Ahead
http://www.reuters.com/article/2013/04/07/us-usa-stocks-weekahead-idUSBRE9340XA20130407

Debate Fizzles
http://www.marketwatch.com/story/krugman-stockman-tv-debate-fizzles-2013-04-07?pagenumber=1

Mortgage Mods
http://t.ritholtz.com/bigpicture/#!/entry/california-housing-still-bouncing-along-the-bottom,51608166d7fc7b56709e3e01/2

If You Won't We Will
http://www.foxnews.com/us/2013/04/07/hundreds-texas-educators-take-free-handgun-class/

Slower Growth
http://www.futuresmag.com/2013/04/05/pimcos-gross-says-us-growth-wont-beat-2-in-2013?ref=hp

Big Bull Markets
http://www.moneynews.com/newswidget/Mobius-tremendous-bull-markets/2013/04/07/id/498173?promo_code=125A8-1&utm_source=125A8Moneynews_Home&utm_medium=nmwidget&utm_campaign=widgetphase1

Up Date
A few days ago we posted a brief about a deal between China and Brazil cutting a currency arrangement. Well, here's another story. Could China's end game be to derail US dollar as currency of international trade?
http://www.scmp.com/business/economy/article/1209560/china-looking-direct-yuan-trade-aussie-dollar

COMING ATTRACTIONS

Maureen Dowd, the NYT columnist, recently penned a piece about Hillary Clinton becoming Obama's successor, a real possibility if the American electorate don't soon awaken from their long slouching-towards-Brussels slumber.  

"Don't need your well-thought-out advice. Though I thank you all for being kind. I can make mistakes myself just find," go the words of a popular song some years ago.

Now this is not so much about Dowd. Or her column. She's a big girl and can spew her drivel without any help just fine. And here's a brief example. 

Dowd, trying to cast the old-take-no prisoners Hillary into a softer, more-human-electable light, writes "... her new haircut sends a signal of shimmering intention: she has ditched the skinned-back bun that gave her the air of a K.G.B. villainess in a Bond movie and has a sleek new layered cut that looks modern and glamorous."

Somewhere on this planet there's still a substance known as truth, though one usually doesn't expect to find it coming from anyone remotely associated with the NYT. Skinned-back bun or otherwise, no slight intended, Hilliary in her best days couldn't pass for a K.G. B. villainous in a short short let alone a Bond film.

So let's get real. The real concern isn't Dowd's column. Everyone by now knows what and where she is. Here's the real concern, a comment sent to Dowd from one her followers.

The problem, as I see it, is that we need, desperately, a Democratic president who will be a Democratic president. That is to say, we need the successor to Barack Obama to be unafraid of pushing for statutory changes that would help the labor movement, go after climate change, do something about the hollowing out of public education, and restore a real progressive cast to the tax code. I know that entitlements have to be tinkered with and I, personally, don't have a problem with doing that. But it is not realistic to expect long-term political success for the Democratic party if it continues down the path of Republican-lite, catering more to Wall Street than the middle class that so desperately needs a return to the policies of the 1930s-1960s that built it.

Now what part of that-we're-going-to-shove-it-down-your-throat-whether-you-like it-or- not agenda don't you recognize? There are some sick puppies out there. And make no mistake they intend to bring that sickness to a venue near you.

To set the record real we don't have a dollar's worth sympathy for either party. Both are more bankrupt than the country.  And if our informal surveys are even slightly accurate, millions of other Americans feel the same. They just have not been pushed to the point of expressing it yet.

But then that's why theaters everywhere show those coming attractions.

BLOWING BUBBLES AGAIN

Pretend you're sitting on a three-legged stool. It's not quite stable. It wobbles a bit, especially to one side. 

Each leg has a name: bonds, real estate and equities. Two of the legs are much longer than the shortest leg. The names of the two longer legs are equities and bonds.

Now if you want to get the three legs the same length, you have a couple of choices: trim the two longer legs to match the shortest one or somehow lengthen the shortest one, real estate, to match the longer legs, equities and bonds.

Suspend your judgments about evaluation for a moment. Equities and bonds many believe are already bubbles. That leaves only real estate, a much bigger component some would argue in the job creation equation.

Janet Yellen is Vice Chair of the Federal Reserve. She is also a likely candidate to replace Big Ben when he finally packs his bags for greener pastures, most likely a high paying consulting gig on Wall Street.

General Douglas MacArthur once noted, "Old soldier never die, they just fade away." We'll, old Washington bureaucrats and politicians don't fade away, they just land rich consulting fees at investment banks or law firms.

In a speech last month that she went to some pains to point out was about communication and transparency, Yellen noted her own beliefs run somewhat counter to the Bernanke QE parade. 

She then resorted to one of Wall Street's usual suspects, a bromide about this is an exceptional time, meaning it's different from all those other rough patches throughout history that were also supposed to be different. 

Short interpretation: "Though I'm on board, if I were Queen of the Fed I'd do more to tackle the unemployment rate." The official rate is 7.2%, a figure that many believe is at least 50% shy of the real rate of today's jobless folks.

 As nearly all know the Fed is spending $85B a month priming the pump, much of that going to purchase mortgage-backed securities. In other words, to bring that shorter, lagging third stool leg to where the stool doesn't wobble so much and everyone feels comfortable and safe sitting on it.

Perception rules.

And when it comes to bureaucrats and elected officials, like aces in poker, three bubbles are better than two.

THE FOUNDATION OF WEALTH

A friend likes to say he'd rather be smart than lucky.

He also told me for a long time many of his friends believed it was just a cute play on the old saying, It's better to be lucky than good.

Lady Luck my friend says is at best fickle. She's a lot like my old girlfriend. I never knew when she was going to show up or suddenly depart. 
  
Knowledge is like a library or the Internet. It's all there you just have bring your own container.

But what it really gets down to is something the late Peter Drucker wrote about in the 1990s in Post Capitalist Society. The essence of Drucker's message, and something he wrote and talked about, long before the computer age, is a society shaped and altered by information.

Knowledge in Drucker's view is more significant than capital. It's a society with two kinds of workers, those who provide services and those who provide knowledge.

Knowledge providers are clearly the more important of the two because they're the idea people. You don't need capital to create ideas. 

And once created finding people to fund them will happen and it will happen without the traditional lenders of the great industrial period, banks and other lending institutions.

Much of that has been happening for a few years now in places like the Silicon Valley and venture capital groups. There's even a popular television program, Shark Tank, centered on this exact premise.

To Drucker knowledge is the foundation of wealth.
http://www.peakprosperity.com/blog/81365/peter-drucker-post-capitalist-economic-transformation

FRIDAY READS

FEW JOBS
http://www.usatoday.com/story/money/business/2013/04/05/march-employment-report/2052529/

USED TO BE SHOTGUN WEDDINGS NOW
http://www.thefiscaltimes.com/Articles/2013/04/03/What-You-Never-Knew-About-Todays-Subprime-Auto-Loans.aspx#page1

TUITION SQUEEZE
http://www.guardian.co.uk/money/2013/apr/04/student-debt-threat-private-university

WORKING FOR THE MAN
http://blogs.marketwatch.com/taxwatch/2013/04/03/youll-work-5-extra-days-for-uncle-sam-this-year/

WORKING FOR THE MAN ACT II
http://blogs.marketwatch.com/taxwatch/2013/04/04/gas-gets-more-taxing-per-gallon/

A TRIBUTE TO ROGER EBERT
http://t.ritholtz.com/bigpicture/#!/entry/violence-movies-thoughts-by-roger-ebert,515e0e7bd7fc7b56709aa0d2/1

RERUN
http://www.hussmanfunds.com/wmc/wmc130401.htm

JOBLESS CLAIMS
http://www.guardian.co.uk/business/2013/apr/04/us-unemployment-claims-four-month-high

10-YEAR TREASURY HIT 4 MONTH LOW
http://www.reuters.com/article/2013/04/05/markets-treasuries-asia-idUSL3N0CS06M20130405

OFF SHORE ANYONE
http://www.guardian.co.uk/uk/2013/apr/03/offshore-secrets-offshore-tax-haven

CRYING TIME AGAIN

Looks like crying time again for the European Union as the ECB opts for the status quo and the latest bleak PMI numbers reveal the EU remains in an economic quagmire.

France, which we wrote about earlier, given all its political turmoil,  appears the sickest, with output falling faster than my relationship with my old girlfriend. 

How fast is that? Forget speeding bullets. Forget too any talk about real new orders. If manufacturing has a cold, services have the flu. Whatever you can say bad about one you can say worse about the other.

The service sector declined in March for the 14th straight month. New employment in the sector now sports a batting average of zero for 15 months.

Cyprus might be off the front page, but it appears to have cast a long shadow when it comes to confidence. Botched bailout is the kinder, gentler term to describe the Cyprus mess.

Italy is still trying to figure out Italy and how to hold a real election. Spain's demise has been greatly under-exaggerated.
And Germany, the one so-called bright star of probity in the whole galaxy, looks to be flat-lining, logging it feeblest growth in months.

Some observers after their meeting today accused ECB president Mario Draghi of being a drag. Steady as she goes on the rates and no new ideas about how to plug the gapping hole the bow of the Good Ship Euroland. 

The whole scene reminds of the little ditty we heard last time we were in Europe: "Don't let my boy grow up to be a Brussels' bureaucrat," the dying mother said. " Don't let him be a Brussels' bureaucrat, I'd rather see him dead."

Yes, it's crying time again and a lot of folks are hoping someone will get up and leave.

GREAT QUOTES

We love great quotes.

Especially when they're funny and true. The only thing missing in this one is Brussels.
http://www.moneynews.com/newswidget/Pickens-Washington-natural-gas-energy/2013/04/04/id/497780?promo_code=10907-1&utm_source=10907Financial_Content_Network&utm_medium=nmwidget&utm_campaign=widgetphase1