The Mess That Greenspan Made - Part 11

Monday Morning Links

MUST READS
Shanghai index jumps 3% on SOE reform – China Daily
Fitch downgrades Japan citing economic concerns – AP
NYSE Margin Debt Hits an All-Time High – short.com
The Nasdaq is looking heady, but this time its different – AFR
“Frustrated” Germany says ball is in Greece’s court – Reuters
Greek President Promises Repayment of all Debt – Spiegel
Greece faces criticism, as ‘plan B’ speculation mounts – euobserver
Greeks’ view of the debt crisis: ‘What lies ahead is great, great hardship’ – Guardian
The gluten-free movement is ruining our relationship with food – Washington Post
Desalination plants aren’t a good solution for California drought – LA Times
This Is How Fast America Changes Its Mind – Bloomberg
New Highs To Nowhere On Nothing – Mark St. Cyr
Pro-Bubble – Credit Bubble Bulletin

MARKETS/INVESTING
Stocks rise despite Japan downgrade, lack of Greece deal – AP
The Magic NASDAQ Record Number: 6,941 – Fox Business News
Fair Value on the S&P 500 Has Three Digits – Hussman Funds
Deflation? Oil’s 45 percent rebound could be markets’ next headache – Reuters
Just the Idea of Inflation Is Spooking Bond Traders Again – Bloomberg
Gold climbs back above $1,180/oz as European stocks wilt – Reuters
China, India Import Massive Quantities of Gold from Switzerland – GoldCore
How central banks mislead on gold reserve reporting – Mineweb
China Uses Gold To Pursue Global Power – Seeking Alpha

ECONOMY/WORLD/HOUSING/BANKING
The rich really do get richer – USA Today
Who actually makes the minimum wage today – Washington Post
Reminding Voters That American Wages Have Flatlined – Daily Beast
China employment growth weakens amid slowdown – xinhuanet
Spain: PM says economy on track to grow 2.9 pct this year – AP
Is another housing bubble just around the corner for London? – Telegraph
Views of Home Buying Climate Slightly Less Positive in U.S. – Gallup
Millennials shun the new home sales market – Dr. Housing Bubble
More central banks meet, but ability to pilot economies in doubt – Reuters
Fed Triggers Bank Flight From Emerging Markets – Bloomberg

 

New Rules for the Bronconeers

I’m not a big fan of Amy Schumer (don’t know why – things just seem to rub me the wrong way far too often or I’m just too old for her brand of humor), but this sketch about football and rape is pretty funny and, as is the case for most good satire, quite instructive.

These videos of Rodney Dangerfield and Robin Williams on the Tonight Show with Johnny Carson that showed up in the Up Next sidebar are more my style – I guess I am getting old…

 

Friday Morning Links

MUST READS
Equities at all-time high after Nasdaq record – Reuters
Investors’ exuberance at frighteningly high level – MarketWatch
Greece’s Scary Calendar of Debt Payments Due – Bloomberg
Greece, European creditors fail to reach deal on bailout – US News
EU Frustration Mounts as Greeks Try to Bypass Aid Process – Bloomberg
U.S. sues Quicken Loans, accuses it of mortgage lending violations – Fortune
Confirmed: Oklahoma Earthquakes Caused By Fracking – EcoWatch
Oklahoma Lawmakers Vote To Outlaw Fracking Bans – Think Progress
Clinton Campaign Not Answering Questions About Sketchy Donations – reason.com
Two-thirds of Americans don’t understand how credit cards work – My Budget 360
Where the Bad of Deflation Looks Good – true economics
Crash Boys – Lewis, Bloomberg

MARKETS/INVESTING
Stocks mostly up after Nasdaq record – AP
Google, Amazon poised to lead Nasdaq higher – MarketWatch
Oil prices trade near 2015 highs on Yemen worries – Reuters
Problem: Many investors are ‘rate hike newbies’ – CNN/Money
As China Stocks Outrun the 2007 Bubble, UBS Braces for Clampdown – Bloomberg
If China Sees Capital Outflows Now, What Happens in Crisis? – Bloomberg
Gold retreats as global equities hit all-time highs – Reuters
The Rehypothecation of Gold, and Why It Matters – of two minds
Silver – Four Years Later – GoldSilverWorlds

ECONOMY/WORLD/HOUSING/BANKING
The Disappointing U.S. Economy – Bloomberg
Strong dollar winning in Battle Against Cheap Gas – NY Times
Paul Volcker Isn’t Worried About Low Inflation. You Shouldn’t Be Either – Bloomberg
Are Leading Economists Corrupt, or Just Mind-Blowingly Ignorant? – Washington’s Blog
Putin’s Miracle Dissolves as Russian Middle Class Faces Crunch – Bloomberg
RT News: When words speak louder than guns – euobserver
Work Tensions Rise in China, Despite Calls for Harmony – WSJ
The Recovery in the Housing Market is Still Blotchy – Fox Business News
Julian Castro, HUD Secretary, Admits Affordable Housing Difficulties – Latin Post
Swiss Central Bank Says Negative Rates Won’t Become ‘New Normal’ – WSJ
San Francisco Fed Sticks to Rosy Forecast Despite Recent Weakness – WSJ

 

Another Stunning Long-Term Chart

From a recent presentation(.pdf) by Agustín Carstens, Bank of Mexico governor and chairman of the IMF’s International Monetary and Financial Committee, via this item at Wolf Street comes the chart below that, once again, reminds us all how far removed the global financial system is from anything that could be considered “normal”.

Carstens doesn’t oppose recent interest rate and QE policies by central banks, but he is quite concerned about how it all turns out, summing things up rather nicely by noting:

The crux of the matter is that financial risk-taking has been far more responsive to unconventional monetary policies than real risk-taking has been.

This would be less troubling (well, at least a little less troubling) if not for the fact that the world’s most important central bankers in general (and former Fed Chief Bernanke in particular) have never acknowledged that “the reach for yield” even exists.

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