In our recent post, "Wonder Why?"we mentioned the tax savings these companies get when moving off shore. In many cases it's bigger than big.
Congress in its infinite wisdom is constantly after China to strengthen it currency, the yuan, to help close the trade gap between the two nations. In economic parlance it's known as beggar thy neighbor. In a broader sense it very similar to countries that have lower corporate tax basis.
Attracting businesses is what its all about whether its the state of Texas or a country like Ireland or Canada.
The Pfizer-AstraZeneca deal is much in the news now and rumors about such a mega deal were afloat on the street for a while before it hit MSM. Here's more on the subject from Reuters.
http://www.reuters.com/article/2014/05/01/us-usa-tax-mergers-idUSBREA4003G20140501
Watch, wait and plan mode is how the Wall Street Journal described today's Fed announcement about what investors have come to know and fear as the Fed's tapering program.
Once upon a time in the Land of Monetary Policy there was QE, otherwise known as Fed speak for quantitative easing or let the ink on the printers fly. And fly it did. There are many kinds of highs in life. But for politicians and Wall Street denizens it's liquidity and easy money.
Any threat to that dynamic duo and it 's turn off the fans before you know what starts to fly. So the Fed played a little good cop bad cop announcing earlier in the day growth in the economy barely budged in the first quarter and following it up saying it will continue to pare back its bond and mortgage-back securities purchases in May.
http://online.wsj.com/news/articles/SB10001424052702304178104579533861135944336?mod=WSJ_hp_LEFTWhatsNewsCollection&mg=reno64-wsj
We've been harping about the bogus inflation crap coming from the Fed and its cronies in MSM for a long time now.
We don't want to confuse anyone with basic simple stuff like utilities, trash collection and a whole host of everyday stuff like food and energy; that would be too pedestrian. And, oh yea, property and sales and professional fee taxes, they're not part of one's increased costs of existing either.
Here in California the Freeway electric bulletin board signs now warn about a recently increased cell phone fine of $161-plus, a 30-percent-plus, to borrow the idiom of bureaucrats who cook this stuff up, hike for the infraction.
Maybe we're being a bit un-child like here for not appreciating more the now-you-see-it-now-you don't legerdemain. It's so magical.
http://davidstockmanscontracorner.com/memo-to-dr-yellen-on-the-low-flation-myth-inflation-seen-and-not-seen/?utm_source=wysija&utm_medium=email&utm_campaign=Mailing+List+AM+Wednesday
Some gloom, some doom and some pushback.
Normally, we'd post this under voices where we usually put market strategists and their economic meanderings. But Faber is fun to hear and to read.
And the guy from the Times makes a valid point. His comment implies the gloom and doomsters manipulate the market for personal gain. That's interesting and raises an interesting question: What does Wall Street with its horde of bankers like Goldman Sachs do, sell lollipops?
http://blogs.marketwatch.com/thetell/2014/04/30/crashy-marc-faber-its-too-late-to-buy-u-s-stocks-now/
This is a four-letter word we've alluded to before and, in our humble opinion, at least one reason the Fed is behind the curve.
Jobs. Yes, they're out there and this is not the first sign. Again, if Fed Chair Yellen, as she recently did, questions the accuracy of the Fed's models to adequately track prices is correct why would jobs be any better. The truth is they ain't.
The truth is the Fed is trying to muddle its way through a situation they muddled up to begin with. From Japan to the EU to the US as more and more of these economic soothsayers keep worrying about more deflation the less likely that's what's in store. As even Keynes pointed out: nine times out of 10 the most feared never happens.
http://www.businessweek.com/articles/2014-04-24/labor-shortages-pop-up-in-many-u-dot-s-dot-cities
We'll call this for want of a better term an interesting discussion that took place earlier today from a panel of three prominent American economists. Make of it what you you want. Our take, again for want of a better term, is a big yawn. Furthermore, it's just one more example, prominent economists or no, of "your guess is as good as mine."
http://blogs.marketwatch.com/thetell/2014/04/29/roubini-rogoff-taylor-debate-the-global-economy-live-blog/
A few years ago it was a Connecticut firm that sought to move off shore. Reason: To save on costs, a euphemism for tax bill.
Politicians on the left and right rallied to call the 100-plus year old company's move a bunch of names including ''un-American." The firm finally backed down and stayed in one of the highest tax states.
Now two more huge companies want to move their headquarters, Toyota and Pfizer, for reasons we'll leave you to figure out since elected official apparently can't or, worse yet, don't want to.
http://online.wsj.com/news/articles/SB10001424052702304163604579530162313579896?mod=WSJ_hps_sections_health&mg=reno64-wsj
http://www.cnbc.com/id/101625195
The European Union gets about 40% of its natural gas and 20% of its oil from Russia, not a good position to be in when you're doling out sanctions
Talk about biting the hand that feeds you. Europe is noted for its environmental activists and for years many countries there have been trying to clean up their greenhouse act. A noble goal to be sure. But so is trying to stay warm during frigid winters
One of the big greenhouse bogey men for decades has been coal, that thick-smoke-producing cheap energy industries worldwide depended on for years. Japan after it's Fukashima nuclear disaster is now considering coal to supply some of its energy needs. And China with its own energy problems, according to most reports, is one of the worlds largest importers of coal.
And there are others including India looking at coal. Though most environmentalists won't admit it, alternative sources ain't the answer for a variety of reasons too numerous to discuss.
(See http://ourfiniteworld.com/2014/04/23/eight-energy-myths-explained/.) Germany and Poland mine lots of the stuff. Coal is cheap as in the cheapest source of energy despite what many will say.
We're not predicting anything, but don't be too surprised if this turns out to be another chapter in what goes around comes around.
http://www.minyanville.com/sectors/energy/articles/Coal-Increasingly-Seen-As-Option-For/4/28/2014/id/54745
The glory that was once Roma.
Italy is one of the European Union's periphery nations like Greece and Portugal. As one of the richest institutions in the world, the Catholic church, prepares to canonize two still very-much-with-us former popes in a gala festival, Roma and the rest of the nation continues to crumble. And the madness continues.
It's a canonization MSM worldwide will be all over, a morally-bankrupt media covering a bankrupt nation.
Read the full story.
http://www.spiegel.de/international/europe/new-mayor-in-rome-seeks-to-prevent-further-decline-in-city-a-965806.html
