RALLY ARTIFICIAL?
http://www.moneynews.com/newswidget/El-Erian-Fed-market-central-banks/2013/03/29/id/496934?promo_code=10907-1&utm_source=10907Financial_Content_Network&utm_medium=nmwidget&utm_campaign=widgetphase1
NANNY STATE A PENNY PER OUNCE
http://online.wsj.com/article/SB10001424127887324789504578380271797966326.html?mod=opinion_newsreel
JAPANESE INFLATION
http://www.reuters.com/article/2013/03/31/us-economy-global-weekahead-idUSBRE92U07920130331
ARRESTED
http://www.guardian.co.uk/world/2013/mar/31/egypt-orders-arrest-tv-satirist
SMALL BUSINESSES MAY FURTHER DAMAGE EU
http://www.reuters.com/article/2013/03/28/us-italy-spain-banks-idUSBRE92R03K20130328
KOREAN SITUATION AND THE MARKETS
http://www.futuresmag.com/2013/03/31/commodity-stock-markets-assess-risk-of-korean-war?ref=hp&t=forex&page=2
HOLD THAT TAX
http://www.reuters.com/article/2013/03/31/us-brazil-economy-cartax-idUSBRE92U00N20130331
WHAT'S IN YOUR WALLET?
http://www.moneytalksnews.com/2013/03/28/what-should-and-what-shouldnt-be-in-your-wallet/?utm_source=newsletter&utm_campaign=email-2013-03-31&utm_medium=email
GOOD ADVICE
http://www.psychologytoday.com/blog/strategic-thinking/201303/why-we-ignore-good-advice
Sunday, March 31, 2013
HIGH STAKES
If you track hydrocarbons you'll usually find the trail leads to more than just some information about oil and gas reserves.
Forget the Bourne Identity or Bond. Truth is far more intriguing than fiction.
US special forces have been training Syrian rebels for some time now. That's not news. What is news is the US government's sudden efforts to get the story out and to make it look as if it's a leak.
Unlike some of its neighbors Syria is not landlocked, a key point. This is about more than helping to remove a government regime viewed as unfriendly to the West. This is about gas, lots of it and who controls it.
Recall the story involving Attorney General Eric Holder and those weapons that allegedly found their way into the wrong hands, agents of Mexico's infamous drug cartel. Well, Syria holds a similar time bomb for the administration: Just who are the American forces in Syria training, true independents or jihadist who have infiltrated the movement?
As Jen Alic for Oilprice.com notes, reports from the area state the Free Syrian Army, the people the US is supposedly training, have been heavily infiltrated by jihadists. Officials in Washington claim American special forces there are training Jordanians in Jordan, not members of the Free Syrian Army.
Last week the Associated Press, citing several un-named officials, began "leaking" the story. Whoever the US is training, Jordanians or otherwise, reports say that information is being passed across the border to Syrians where the the fighting between the Free Syrian Army and government forces rages. CIA operatives hover nearby.
Enter Ghassan Hitto, a former resident of Murphy, Texas, who was born in Damascus, United Arab Republic (now Syria) in 1963 and migrated to the US in 1980. Educated here Hitto holds degrees in mathematics and computer science, he worked in technology and was one of the founding members after 911 of the Muslim Legal Fund of America to give legal aid to Muslims. He is Kurdish.
Late last year he suddenly moved to Turkey and got involved with the National Coalition for Syrian Revolutionary and Opposition Forces. In mid-March he was elected prime minister of an interim government in a split election that was boycotted by some members of the Coalition, including some of the Free Syrian Army, one of the major groups aligned against Assad's troops.
The truth is the Eastern Mediterranean is gas rich, a fact of more than passing interest to any number of players, not the least of which include: Russia, Europe, Turkey and the US. Hitto is the US's man in waiting. Some say he's also Turkey's choice.
The US itself is a surrogate man in waiting. A lot remains at stake here. More than many would imagine. Different countries are backing the various so-called freedom fighters for different reasons.
Cyprus is just a tiny part of a story that could easily rival most spy thrillers. Noble, a Houston-based oil company, is set soon to start drilling for gas in a block in the Mediterranean owned by Cyprus. They're looking for oil and gas, not something endearing them to Turkey.
Cyprus is two-thirds controlled by Greek-Cypriates, the other by those with ethnic Turkish ties. Turkey just severed an agreement with Italian oil company, Eni, presumably because the Italian firm recently started operations off the Cyprus coast.
When in 2004 the tiny island was accepted into the EU it was only the Greek-Cypriot two-thirds, the Greek-Cypriot Republic of Cyprus, that joined the union. Turkey only recognizes the northern third.
Turkey's press release about its actions against Eni cited concerns about Cyprus' Turkish population getting its fair share of the possible proceeds coming from Cyprus-owned Mediterranean oil and gas blocks.
The timing of the announcement, many observers believe, coming just days ahead of scheduled biddings for more Cyprus oil and gas licenses, sends a subtle message: drill offshore in Cyprus, miss out in Turkey.
Russia now supplies Europe with a major portion of it natural gas. New supplies from the eastern Mediterranean, depending on who controls them, could threaten that hold. Here are some links about what's at stake from a report way before the Cyprus story hit the international media.
As we said big players, high stakes and lots of intrigue.
http://carnegieendowment.org/2013/02/08/battle-for-syria/f6t6
http://oilprice.com/Energy/Crude-Oil/Recent-Oil-Discovery-off-Lebanese-Coast-Draws-Naval-Powers-to-East-Med.html
Forget the Bourne Identity or Bond. Truth is far more intriguing than fiction.
US special forces have been training Syrian rebels for some time now. That's not news. What is news is the US government's sudden efforts to get the story out and to make it look as if it's a leak.
Unlike some of its neighbors Syria is not landlocked, a key point. This is about more than helping to remove a government regime viewed as unfriendly to the West. This is about gas, lots of it and who controls it.
Recall the story involving Attorney General Eric Holder and those weapons that allegedly found their way into the wrong hands, agents of Mexico's infamous drug cartel. Well, Syria holds a similar time bomb for the administration: Just who are the American forces in Syria training, true independents or jihadist who have infiltrated the movement?
As Jen Alic for Oilprice.com notes, reports from the area state the Free Syrian Army, the people the US is supposedly training, have been heavily infiltrated by jihadists. Officials in Washington claim American special forces there are training Jordanians in Jordan, not members of the Free Syrian Army.
Last week the Associated Press, citing several un-named officials, began "leaking" the story. Whoever the US is training, Jordanians or otherwise, reports say that information is being passed across the border to Syrians where the the fighting between the Free Syrian Army and government forces rages. CIA operatives hover nearby.
Enter Ghassan Hitto, a former resident of Murphy, Texas, who was born in Damascus, United Arab Republic (now Syria) in 1963 and migrated to the US in 1980. Educated here Hitto holds degrees in mathematics and computer science, he worked in technology and was one of the founding members after 911 of the Muslim Legal Fund of America to give legal aid to Muslims. He is Kurdish.
Late last year he suddenly moved to Turkey and got involved with the National Coalition for Syrian Revolutionary and Opposition Forces. In mid-March he was elected prime minister of an interim government in a split election that was boycotted by some members of the Coalition, including some of the Free Syrian Army, one of the major groups aligned against Assad's troops.
The truth is the Eastern Mediterranean is gas rich, a fact of more than passing interest to any number of players, not the least of which include: Russia, Europe, Turkey and the US. Hitto is the US's man in waiting. Some say he's also Turkey's choice.
The US itself is a surrogate man in waiting. A lot remains at stake here. More than many would imagine. Different countries are backing the various so-called freedom fighters for different reasons.
Cyprus is just a tiny part of a story that could easily rival most spy thrillers. Noble, a Houston-based oil company, is set soon to start drilling for gas in a block in the Mediterranean owned by Cyprus. They're looking for oil and gas, not something endearing them to Turkey.
Cyprus is two-thirds controlled by Greek-Cypriates, the other by those with ethnic Turkish ties. Turkey just severed an agreement with Italian oil company, Eni, presumably because the Italian firm recently started operations off the Cyprus coast.
When in 2004 the tiny island was accepted into the EU it was only the Greek-Cypriot two-thirds, the Greek-Cypriot Republic of Cyprus, that joined the union. Turkey only recognizes the northern third.
Turkey's press release about its actions against Eni cited concerns about Cyprus' Turkish population getting its fair share of the possible proceeds coming from Cyprus-owned Mediterranean oil and gas blocks.
The timing of the announcement, many observers believe, coming just days ahead of scheduled biddings for more Cyprus oil and gas licenses, sends a subtle message: drill offshore in Cyprus, miss out in Turkey.
Russia now supplies Europe with a major portion of it natural gas. New supplies from the eastern Mediterranean, depending on who controls them, could threaten that hold. Here are some links about what's at stake from a report way before the Cyprus story hit the international media.
As we said big players, high stakes and lots of intrigue.
http://carnegieendowment.org/2013/02/08/battle-for-syria/f6t6
http://oilprice.com/Energy/Crude-Oil/Recent-Oil-Discovery-off-Lebanese-Coast-Draws-Naval-Powers-to-East-Med.html
Friday, March 29, 2013
WEEKEND READS
ONCE THE SAFEST
http://www.marketwatch.com/story/money-market-funds-are-a-most-dangerous-investment-2013-03-29?pagenumber=2
BEWARE OF THE HUNGARIAN FORINT
http://www.bondvigilantes.com/
CONGRESS EXPORTING MORE IGNORANCE
http://cafehayek.com/
KNOW YOUR FRIENDLY DENTIST
http://www.chron.com/news/us/article/HIV-test-urged-for-7-000-Oklahoma-dental-patients-4392561.php
OIL,STEEL, RAIL AND AYN RAND
http://blogs.oilandgasinvestor.com/
JINGOISM
http://www.reuters.com/article/2013/03/29/us-korea-north-idUSBRE92R13R20130329
MUCH NEEDED HARD TO DIGEST
We came across a French poll earlier this year that showed 80% of the people polled believed their country was bankrupt.
Well, here's France's new president, Francois Hollande, a Socialist many in European media gloated over when he won, calling for no new taxes, protecting defense spending, cutting state spending and red tape for businesses.
Mr. Obama and Mr. Krugman, are you paying attention?
French unemployment is in double-digit land and the spread premium between German and French 10-year government bonds widened again recently, up 16 basis points since last December.
More incentives for those drawing unemployment to return to work, unbelievable coming from a socialist politician.
But the real irony is many of these changes are mere extensions of those started by his free-market talking predecessor, Nicolas Sarkozy.
According to polls Hollande is the most unpopular French president in 30 years.
One thing remains clear. Such changes, if they get implemented, would have digested a lot smoother had they been done a lot earlier.
http://www.bloomberg.com/news/2013-03-28/hollande-presses-french-to-embrace-social-revamp-to-spur-growth.html
Well, here's France's new president, Francois Hollande, a Socialist many in European media gloated over when he won, calling for no new taxes, protecting defense spending, cutting state spending and red tape for businesses.
Mr. Obama and Mr. Krugman, are you paying attention?
French unemployment is in double-digit land and the spread premium between German and French 10-year government bonds widened again recently, up 16 basis points since last December.
More incentives for those drawing unemployment to return to work, unbelievable coming from a socialist politician.
But the real irony is many of these changes are mere extensions of those started by his free-market talking predecessor, Nicolas Sarkozy.
According to polls Hollande is the most unpopular French president in 30 years.
One thing remains clear. Such changes, if they get implemented, would have digested a lot smoother had they been done a lot earlier.
http://www.bloomberg.com/news/2013-03-28/hollande-presses-french-to-embrace-social-revamp-to-spur-growth.html
BEWARE OF OCTOPI ON PEDS
It's that time of year again, tax time.
Since the market is closed Good Friday and markets in Europe will be off Monday, maybe a little levity in the face of all the turmoil going on might lighten things up a bit. We'll see.
Nearly a decade ago when my retired partner and I ran a small Newport Beach investment boutique for private clients, we ran into a lot of AMT, the alternative investment tax. In short, it's one of Congress' most clucked-headed, dumbest ideas. And that covers some serious ground.
And that's where the levity comes in. Sometimes you have to just laugh at the stupidity of these folks, it's magnitude. We spent a lot of keyboard time writing about it then, trying to inform and warn. It's like an octopus on performance enhancing drugs whose tentacles keep getting longer every year.
Yet there's something about even the mildly complex that turns many people off. That is, until it hits their wallet and they have to tell their significant other.
We'll spare you the angry-provoking details. It's another one of those to-get-the-few-you-concoct-an idiotic-complex tax that eventually gets the innocent and the many and zero of the few.
So with that introduction, happy tax time to all and here is a link for your reading pleasure.
http://www.thefiscaltimes.com/Articles/2013/03/28/10-Tax-Laws-That-Hurt-the-Economy-Most.aspx#page1
Since the market is closed Good Friday and markets in Europe will be off Monday, maybe a little levity in the face of all the turmoil going on might lighten things up a bit. We'll see.
Nearly a decade ago when my retired partner and I ran a small Newport Beach investment boutique for private clients, we ran into a lot of AMT, the alternative investment tax. In short, it's one of Congress' most clucked-headed, dumbest ideas. And that covers some serious ground.
And that's where the levity comes in. Sometimes you have to just laugh at the stupidity of these folks, it's magnitude. We spent a lot of keyboard time writing about it then, trying to inform and warn. It's like an octopus on performance enhancing drugs whose tentacles keep getting longer every year.
Yet there's something about even the mildly complex that turns many people off. That is, until it hits their wallet and they have to tell their significant other.
We'll spare you the angry-provoking details. It's another one of those to-get-the-few-you-concoct-an idiotic-complex tax that eventually gets the innocent and the many and zero of the few.
So with that introduction, happy tax time to all and here is a link for your reading pleasure.
http://www.thefiscaltimes.com/Articles/2013/03/28/10-Tax-Laws-That-Hurt-the-Economy-Most.aspx#page1
Thursday, March 28, 2013
GOOD FRIDAY READS
Big Brother
http://www.guardian.co.uk/world/2013/mar/28/aclu-stingray-surveillance-police-cellphones
Later Or Sooner
http://blogs.marketwatch.com/thetell/2013/03/28/default-only-answer-to-cyprus-crisis-mark-mobius/
US Migration
http://news.investors.com/032813-649561-americans-are-migrating-to-more-free-republican-states.aspx?ref=HPLNews
Buy Or Lease
http://www.dailyfinance.com/2013/03/27/car-buy-lease-readers-advice/
DOES IT MATTER?
Analogies can be dangerous.
Comparing one thing to another can often leave room for criticism.
In this case, however, when it comes to trusting bureaucrats to look after your welfare and that of greater society, the rewards far outweigh the risks.
We all know that so-called watchdogs in the US failed to keep their eyes on the hen house in more than one bubble since 2000. The too big to fail, for example, in the view of many has simply led to fewer, even bigger too big to fail financial institutions.
If you read the following story you'll learn, if you don't already know, that such events given the recent Cyprus turmoil, aren't unique to the US. Boys might be boys as the old saying goes. But so are bureaucrats.
In the late 1990s the UK faced a banking crisis. Confidence waned and a new government watchdog, the FSA, was established to prevent it from happening again. The rest, as by now, you should already know.
Initials get changed, a few chairs shuffled. But business as usual prevails.
http://www.futuresmag.com/2013/03/27/fsa-fails-to-reach-16th-birthday-as-crisis-spoils?ref=hp
Comparing one thing to another can often leave room for criticism.
In this case, however, when it comes to trusting bureaucrats to look after your welfare and that of greater society, the rewards far outweigh the risks.
We all know that so-called watchdogs in the US failed to keep their eyes on the hen house in more than one bubble since 2000. The too big to fail, for example, in the view of many has simply led to fewer, even bigger too big to fail financial institutions.
If you read the following story you'll learn, if you don't already know, that such events given the recent Cyprus turmoil, aren't unique to the US. Boys might be boys as the old saying goes. But so are bureaucrats.
In the late 1990s the UK faced a banking crisis. Confidence waned and a new government watchdog, the FSA, was established to prevent it from happening again. The rest, as by now, you should already know.
Initials get changed, a few chairs shuffled. But business as usual prevails.
http://www.futuresmag.com/2013/03/27/fsa-fails-to-reach-16th-birthday-as-crisis-spoils?ref=hp
THURSDAY READS
Oil Demand Drying Up?
http://blogs.marketwatch.com/energy-ticker/2013/03/27/citi-to-wall-street-oil-demand-may-peak-before-decade-is-over/
So Much For More Choices
http://www.futurity.org/society-culture/more-choices-lead-to-bigger-gambles/
Asian Sell Off
http://www.cnbc.com/id/100598570?__source=stocktracker&par=stocktracker
Gold Worst Quarter
http://www.bloomberg.com/news/2013-03-28/gold-headed-for-worst-quarterly-run-since-2001-amid-weak-demand.html
Gloom And Doom
http://blogs.marketwatch.com/thetell/2013/03/27/marc-faber-aka-dr-doom-says-theres-nowhere-to-hide-from-bubblegeddon-not-even-gold/
Actuaries Spread More Gloom
http://blogs.marketwatch.com/health-exchange/2013/03/27/actuaries-say-individual-plan-claims-will-rise-32-under-obamacare/
Wednesday, March 27, 2013
LAND OF THE NEARSIGHTED
A long weekend awaits.
Traders traditionally don't like to go into three day weekends with positions that could turn vulnerable quickly.
Given all the turmoil in Europe and other spots, we could see further weakness into Thursday since the market will observe Good Friday. A recent survey in France revealed 80% believe their country is bankrupt. Are they realists or just slow learners?
At the same time the trouble warrants some snooping as Euro shares take a hit. If you buy into the US recovery story, you might want to snoop out some of Europe's better multinationals. They're out there.
Money always leaves the overbought. Buy what's cheap. If you don't know what's cheap, find out.
If you think deflation is the problem, then the safer bet favors utilities and drug stocks, things people depend on and use like booze and tobacco and sex.
If you like to buy the out-of-favor, downtrodden, snoop around cyclicals and mining companies particularly gold mining shares. Some even offer decent payouts like Newmont.
We know gold is under pressure, hedge fund selling, prospects of stronger dollar and higher interest rates. A key question here is when does the Fed's QE end, this year or early next. Big Ben surely wants to put it to bed for his legacy before he ponies back to the College of New Jersey, otherwise known as Woodrow Wilson U.
Rather than hide from the turmoil embrace it. It is what it is. Chaos creates opportunity. As long as you know your tolerance level, have done your homework and you understand the risks, you can still get jarred. But you're not flying blindly.
Leave that for the politicians and the bureaucrats. If there were just put options on those boys and gals, we could all get George-Soros rich.
Remember cyclops rule in the land of the nearsighted.
SO MUCH FOR ACCURACY
To use the following linked study's own words: The chart’s data were taken from a 50,000-loan sample of Freddie Mac-backed fully amortizing 30-year fixed-rate single-family mortgages that were originated in 2011.
http://blogs.marketwatch.com/thetell/2013/03/27/new-freddie-mac-data-show-the-difficulty-in-identifying-mortgage-risks/
These were not those subprime honeys done way back in 2005 or so. These were fixed-rate loans that usually require much more diligence on the borrower to meet more stringent standards of the lender.
It shouldn't pump up your confidence in bureaucrats. What this should tell you is these folks have a hard time getting it right even under supposedly the best of conditions.
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