Common sense has escaped the highest civilization in history….
Comments »Monthly Archives: March 2012
Incredibly Excessive: 450 Million Hollow Points
18 Year-Old Rescued after Month Adrift at Sea
By Rosa Prince, New York
9:32PM BST 28 Mar 2012
The 10-foot boat containing Adrian Vasquez had travelled more than 600 miles in 28 days when it was found off Ecuador’s Galapagos Islands by a commercial fishing vessel.
His two friends had died more than a week earlier, and Mr Vasquez survived by eating raw fish. He told his rescuers that a sudden rainstorm towards the end of his ordeal saved his life after he ran out of water.
Dozens of people turned out to welcome the noticeably-thin teenager home when he arrived back in Panama to be reunited with his relieved parents. He wept as he embraced his relatives but did not speak to journalists.
Captain Hugo Espinosa of the Ecuador coastguard, whose patrol boat picked Mr Vasquez up from the commercial fishing ship, said he was suffering from malnutrition and severe dehydration when he was found.
The captain said: “He didn’t know what was happening. He was quiet, looking lost. Little by little he began to react. But the subject of his dead friends made him stay silent and lower his gaze. It cost him a lot to discuss the matter.”
Read the rest here.
Inflation and the Illusion
Don’t tell the bull ’bout this….
[youtube://http://www.youtube.com/watch?v=bb8l8MWA7yk 450 300]
Why Wall Street Hates the Lazy Portfolios Strategy
By PAUL B. FARRELL
“America’s investors have been ripped off as massively as a bank being held up by a guy with a gun and a mask,” former Securities and Exchange Commission Chairman Arthur Levitt warned in an article in Fortune magazine a decade ago. That same year in his classic “Take On The Street,” Levitt lambasted the fund industry as “a culture that thrives on hype … withholds important information,” a “cutthroat business” that “misleads investors.” Today, it’s worse.
Lazy Portfolios were born as a defensive move against this relentless war by guys with “masks and guns … ripping off” America’s 95 million Main Street investors. And the strategies of men like Levitt, Vanguard’s Jack Bogle, Nobel Economist Daniel Kahneman, Warren Buffett, Yale’s Robert Shiller and other industry giants were the inspiration.
Lazy Portfolios give investors a far superior alternative than gambling retirement savings in Wall’s Street’s casino. Simple solutions: Just three to 11 no-load low-cost index funds, and zero trading. And in the past decade we’ve discovered eight great Lazy Portfolios that investors are using as guides to building their own portfolios, without brokers or advisers.
Today, Wall Street, the fund industry and brokers hate these eight Lazy Portfolios even more. Not just because they consistently beat the S&P 500 on a long-term basis. Not because they’re based on the exact same Nobel Prize-winning model Wall Street’s top wealth managers use. Not because you don’t need any fancy algorithms to rebalance your portfolio. And not because Bogle calls industry insiders casino “croupiers” because they skim a third of your market returns off the top, leaving you leftover crumbs.
The more you trade at Wall Street’s casino, the richer your broker gets.
Read the rest here.
Comments »A Rational Reason for High Oil Prices
via Econbrowser
“There is no rational reason for high oil prices,” writes Ali Naimi, Saudi Arabian Minister of Petroleum and Mineral Resources, in today’s Financial Times. Well, I can think of one– if oil prices were lower, the world would want to consume more than is currently being produced.
The graph below plots total world oil production over the last decade. After growing rapidly in earlier years, production hit a bumpy plateau. In November 2007, just before the U.S. recession began, the world was producing 84.9 million barrels each day, a little less than was produced in the spring of 2005. Although production stagnated, the demand curve continued to shift out, with world GDP growing 5.3% in 2006 and another 5.4% in 2007. Consumption of petroleum by China alone was 800,000 barrels/day higher in 2007 than it had been in 2005, meaning the rest of the world had to decrease consumption over this period.
Read the rest here.
Comments »Idiota: Man Saws Off Foot To Continue Receiving Jobless Benefits
Ex-MF Global Edith O’Brien takes fifth at hearing
Comments »WASHINGTON (AP) — A former MF Global executive has refused to answer lawmakers’ questions about $200 million that was transferred out of a customer account days before the firm collapsed, invoking her Fifth Amendment right against self-incrimination.
Edith O’Brien, a former assistant treasurer at MF Global, was subpoenaed to testify before the House Financial Services oversight subcommittee hearing about an email she sent, which appears to contradict testimony from Jon Corzine, the firm’s then-CEO.
The email says Corzine ordered the transfer on Oct. 28 to cover an overdraft in the firm’s bank account in London. The committee cited the email in a memo released last week.
“On the advice of counsel, I respectfully decline to answer based on my constitutional right,” O’Brien responded to a question about the transfer.
Corzine testified in December that he never directed anyone to use customer funds to fix the overdraft and he wasn’t told that customer money was used.
FB IPO targeting May
Comments »SAN FRANCISCO (Reuters) – Social networking site Facebook is halting the sale of its shares on secondary markets effective next week, aiming to reduce churn in its valuation which could complicate matters as it sets an IPO price, a person familiar with the situation said on Wednesday.
The company, which is preparing for what could be Silicon Valley’s largest initial public offering, has asked firms that arrange trading of its privately held shares to stop, the person said.
Earlier this week, one of the firms that arranges trading in Facebook shares, SharesPost Financial, told investors it was moving up the closing date for its Facebook auction to March 30 from April 2.
Facebook filed its paperwork to go public in early February. Its IPO, expected to value the company at around $100 billion, is expected in coming months.
A Facebook spokesman declined to comment. Representatives at SharesPost and SecondMarket, another firm that arranges trading in private shares, didn’t immediately respond to requests for comment.
EPA proposes first limits on new power plants
Sweet. Say hello to rotting infrastructure. If new plants are going to be this hindered compared to old plants, old plants become way more valuable. I wonder how many Senators have been stocking up on utilities?
Comments »WASHINGTON – The Obama administration forged ahead on Tuesday with the first-ever limits on heat-trapping pollution from new power plants, ignoring protests from industry and from Republicans who have said the regulation will raise electricity prices and kill off coal, the dominant U.S. energy source.
But the proposal also fell short of environmentalists’ hopes because it goes easier than it could have on coal-fired power – one of the largest sources of the gases blamed for global warming.
“Right now, there are no limits to the amount of carbon pollution that future power plants will be able to put into our skies — and the health and economic threats of a changing climate continue to grow,” said Lisa Jackson, the head of the Environmental Protection Agency.
Older coal-fired power plants have already been shutting down across the country, thanks to low natural gas prices, demand from China driving up coal’s price and weaker demand for electricity.
Regulations from the EPA to control pollution blowing downwind and toxic emissions from power plants have also helped push some into retirement, causing Republicans in Congress and on the campaign trail to claim the agency will cause blackouts. Numerous studies and an AP survey of power plant operators have shown that is not the case.
The proposed rule will not apply to existing power plants or new ones built in the next year. It will also give future coal-fired power plants years to meet the standard, because it will eventually require that carbon pollution be captured and stored underground, or injected to extract more oil and natural gas. Such carbon capture technology is not yet commercially available.
By contrast, a new natural gas-fired power plant would meet the new standard without installing additional controls.
“There are areas where they could have made it a lot worse,” said Scott Segal, director of the Electric Reliability Coordinating Council, a coalition of power companies. Still, “the numerical limit allows progress for natural gas and places compliance out of reach for coal-fired plants” not planning to capture and sequester carbon dioxide, the chief greenhouse gas.
U.S. Markets Get a Teflon Rating as the Bears Can Do No Harm
The market had a minor sell off today as traders await answers on the EU meeting to further resolve the ongoing debt crisis. Oil, gold, and most commodities led the way while hopium was spread by this morning’s durable orders number coming in slightly above expectations….really though everyone was expecting a much better #.
An interesting note was the VIX trade today. Spiking as much as 10% only to close down 0.26%.
Above all, the clam has a firm grip on risk and we will likely see more minor selling days on our way to 1450 S&P.
DOW DOWN 71
S&P DOWN 7
NASDAQ DOWN 15
GOLD DOWN $23.50 @ $1661.40
OIL – WTI DOWN $1.80 @$105.52
[youtube://http://www.youtube.com/watch?v=F9r6gV9XY7o 450 300]
[youtube://http://www.youtube.com/watch?v=Vnjt9NTQafQ 450 300]
Natty No Gas Hits 10 year Lows 2Day
Shocking: A Business Conundrum (video)
[youtube://http://www.youtube.com/watch?v=tb_VX5bIQlQ 450 300]
Comments »Freddie Mac Sees the 30Yr Mortgage Rate Moving Up to 4.5% This Year
One Hedge Fund Manager Says Add $1030 to Apple’s Share Price
Supreme Court Justices Ready to Strike Down the Entire Healthcare Law
The Supreme Court’s conservative justices said Wednesday they are prepared to strike down President Obama’s healthcare law entirely.
Picking up where they left off Tuesday, the conservatives said they thought a decision striking down the law’s controversial individual mandate to purchase health insurance means the whole statute should fall with it.
The court’s conservatives sounded as though they had determined for themselves that the 2,700-page measure must be declared unconstitutional.
“One way or another, Congress will have to revisit it in toto,” said Justice Antonin Scalia.
Agreeing, Justice Anthony Kennedy said it would be an “extreme proposition” to allow the various insurance regulations to stand after the mandate was struck down.
Meanwhile, the court’s liberal justices argued for restraint.Justice Ruth Bader Ginsburg said the court should do a “salvage job,” not undertake a “wrecking operation.” But she looked to be out-voted.
Chief Justice John G. Roberts Jr. and Justice Samuel A. Alito Jr. said they shared the view of Scalia and Kennedy that the law should stand or fall in total. Along with Justice Clarence Thomas, they would have a majority to strike down the entire statute as unconstitutional.
An Obama administration lawyer, urging caution, said it would be “extraordinary” for the court to throw out the entire law. About 2.5 million young people under age 26 are on their parents’ insurance now because of the new law. If it were struck down entirely, “2.5 million of them would be thrown off the insurance rolls,” said Edwin Kneedler….”
Comments »Bill Gross says it’s time for investors to plan a “Great Escape”
“Bond king Bill Gross says it’s time to get your portfolio ready for a long-period of lower market returns.
FORTUNE — Apparently, Bill Gross picks movies as well as investments.
Bond investor Gross, who runs the world’s largest mutual fund Pimco Total Return (PTTRX), is known for his quirky letters to investors. In the past he has dispensed love advice (specifically for Europe) and written about why he hates automatic flush toilets. His letter this month, which came out on Tuesday, instead offers movie advice. Gross’ big screen pick is The Great Escape.
The movie came out in 1963, is about World War II and stars Steve McQueen as the head of a group of American soldiers trapped in a German POW camp. Gross says the movie reminds him a lot of what it feels like to be an investor today. Ouch. Except it’s debt that is playing the role of the Nazis. And if you don’t dig a really big tunnel it’s not clear you will ever afford to retire. Not encouraging stuff.
Basically, Gross’ thesis is that the market, and investors, will be trapped in a low-return world for the next few years. That’s because all the things that have been boosting the market for the past few decades – rising debt, low inflation, low-interest rates – are about to reverse. And as all that unwinds, particularly the leverage, Gross sees some pretty strong headwinds for the market. Growth, at least in the 15 years that I have been watching the market, has always been one of the biggest factors in determining what a stock is worth. Less so, in the future Gross says. Because growth is going to be less predictable, and slower, and interest rates and inflation will be higher, lowering the present value of those future dollars (ask your MBA friends what that means), Gross says companies will get less of a premium for what might happen in the future. Instead he thinks companies that generate earnings now, and pay dividends now will get higher valuations, which again would be a big shift.
So what does Gross suggest you do? Generally, Gross, unsurprisingly, likes bonds over stocks. Even though he says bonds on average may only produce 4% returns. But if you are going to buy stocks, Gross says stay away from so-called growth stocks, like say Apple (AAPL), and instead buy consistent dividend paying stocks, like Exxon Mobil (XOM). So go for safety. And he says the shares of companies located in nations with emerging economies like China and Brazil should do better than American or European stocks. Lastly, Gross recommends adding commodities to your portfolio that can protect you from inflation.
The problem with Gross’ prediction of where the market is headed is his “Great Escape” scenario doesn’t sound all that different from his so-called “new normal,” a phrase Gross helped coin three years to describe where the market was headed at the time. And yet, once we got passed the correction of late 2008 and early 2009, being invested in the stock market has felt nothing like being in jail. Last year, was a rocky ride. But in general the market has done pretty well in this recovery, better than the economy in general. And stocks are up pretty significantly again this year….”
Comments »Interesting Times: WSJ: Fed Buying 61 Percent of US Debt
“The Federal Reserve is propping up the entire U.S. economy by buying 61 percent of the government debt issued by the Treasury Department, a trend that cannot last, Lawrence Goodman, a former Treasury official and current president of the Center for Financial Stability, writes in a Wall Street Journal opinion article published Wednesday.
“Last year the Fed purchased a stunning 61 percent of the total net Treasury issuance, up from negligible amounts prior to the 2008 financial crisis,” Goodman writes.
Goodman also warns that U.S. economy and markets are “at risk for a sharp correction” if conditions aren’t “normalized.”
“This not only creates the false appearance of limitless demand for U.S. debt but also blunts any sense of urgency to reduce supersized budget deficits.”
The U.S. government is growing increasingly more dependent on borrowing to finance itself, with net issuance of Treasury securities hitting 8.6 percent of gross domestic product (GDP) on average per annum, more than double levels before the crisis.
Fed intervention in the government debt market makes demand for Treasury bonds appear higher than it really is, as foreign creditors and other investors have fled U.S. government debt instruments and are looking elsewhere until the government makes serious attempts to curb spending and narrow its gaping deficits.
Goodman notes that foreign investors like Japan and China that once scooped up U.S. debt are shunning it. In 2009, such foreign purchases of U.S. debt amounted to 6 percent of GDP and has since falled by over eighty percent to a paltry 0.9 percent.
Without foreign buyers and a shrinking base of U.S. corporate and bank buyers, the Treasury has had to resort to the Federal Reserve itself to make the purchases. The Fed purchasing not only makes up the shortfall, but can keep long term interest rates artificially low.
“The Fed is in effect subsidizing U.S. government spending and borrowing via expansion of its balance sheet and massive purchases of Treasury bonds. This keeps Treasury interest rates abnormally low, camouflaging the true size of the budget deficit,” Goodman writes.
“Similarly, the Fed is providing preferential credit to the U.S. government and covering a rapidly widening gap between Treasury’s need to borrow and a more limited willingness among market participants to supply Treasury with credit.”
Political bickering on both sides of the aisle has prevented politicians from cutting spending and undertaking fiscal reform….”
Comments »“BILL THE BUTCHER” Raw Meat is Back in Style in New York City Restaurants
Story via NYPOST.com
A good 20 minutes before the West Village Japanese restaurant Takashi opens its doors at 6 p.m. on a recent Monday, there is already a line of hungry customers forming out front.
Alex Raij, 43, is one such customer. “We’re super-excited,” says Raij, who had enlisted her mother to watch her two kids so that she and her husband, Eder Montero, 36, could dine out.
“We’ve been really keen to try it.”
What could have stoked such excitement in Raij — herself a busy chef at highly regarded tapas spots Txikito and El Quinto Pino?
Raw meat.
Takashi is one of a small but growing number of restaurants around the city catering to those who are rah-rah about consuming their animal flesh raw-raw.
The heart sashimi is a popular draw at Takashi in the West Village — but it’s not for the faint of (heh, heh) heart.
The first dish to come out is the yooke, ground chuck prepared like a Japanese version of steak tartare. Topped with a raw quail egg, it’s adorned with Japanese seaweed and an enormous shiso leaf.
It’s also by far the tamest uncooked dish at Takashi, which gets its meat from some of the better purveyors around, such as Dickson’s Farmstand and Pat LaFrieda.
There’s the heart sashimi — the organ thinly sliced and simply dressed with wasabi and soy. There’s the namagimo — slivers of liver with sesame oil and rock salt. And, perhaps wildest of all, there’s the nama-senmai, a white, chewy third stomach. (Cows have four stomachs — the third one is used to absorb nutrients.) Flash-boiled but essentially raw, it’s served with spicy miso sauce and scallions and somewhat resembles a bowl of discarded computer parts. “I like that snappiness,” says Raij of the stomach dish. But it’s not her favorite. That would have to be the niku-uni, beef tartare topped with sea urchin and wasabi. “That was delicious. It really contrasted [with seared beef] in temperature and flavor,” she says.
While New Yorkers have long embraced the concept of raw fish, our relationship with raw meat has been more complicated. “Raw meats or undercooked foods leave you at risk of infection [of parasites or a slew of other illnesses],” says Dr. Michael Mansour of the division of infectious diseases at Massachusetts General Hospital.
The health risks — including tapeworms — are not all that different than the ones you face eating sushi. “If you are a person who is elderly, pregnant or your immune system is compromised . . . you should think very carefully about exposing yourself to raw foods, whether sushi or raw meat,” he adds.
According to NYC’s Department of Health, restaurants must notify diners when food isn’t cooked to required temperatures — either verbally or by printing this on the menu. A diner may also request such a dish. Basically, it’s buyer beware — though the DOH says it will investigate complaints of people getting sick from eating raw food. But with so many New Yorkers obsessed with high-quality ingredients, meat so fresh it can be served raw is seen as a benchmark — not a danger.
“There’s no better way to sample quality than when all the other things are stripped away,” says “Bizarre Foods” TV host Andrew Zimmern. The appeal of eating raw is that one tastes the meat without the smoke or the char associated with the cooking process.
And then there’s the primal urge: “Since cavemen have been dragging a brontosaurus leg to the homestead [people enjoyed raw meat],” adds Zimmern.
At downtown’s Acme, you’ll find endive leaves stuffed with a mix of raw bison and sweet shrimp. At Manzo in Eataly, Piedmontese beef is hand-cut and ground to order. Hakata Tonton, just a couple of blocks from Takashi, offers veal liver sashimi on its menu, as does EN Japanese Brasserie on Hudson Street. Last fall, Hecho en Dumbo in the East Village offered venison tartare on the chef’s menu. (It plans to bring it back next fall, too.)
“This is basically dzik,” says Danny Mena, chef of Hecho en Dumbo, referring to the Yucatan specialty. Mena puts his own spin on the dish by soaking cubes of raw venison in sour orange juice, radishes, red onion and cilantro.
And then there’s raw chicken, a dish not for the squeamish. “There are a lot of places in the city that serve raw chicken,” says Dave Pasternack, chef-owner of Esca in Hell’s Kitchen. But you might have to ask, with a nudge and a wink, to go off the menu.
For some, raw meat is uncontroversial. “It’s my soul food,” says Takashi’s Inoue, who grew up in Osaka. “That’s how we eat in my home in Japan. The meat is very, very fresh.”
At First Oasis, out in Bay Ridge, Said Albahri serves raw kebbeh — minced raw lamb mixed with cracked wheat, onions and spices.
“Raw meat is very popular in Syria,” says Albahri, who grew up in Damascus. His customers include plenty of Middle Easterners and locals — but also the epicurious from as far away as Queens.
Still, some dishes haven’t crossed the cultural divide. At the original branch of Eataly in Turin, Italy, you’ll find a raw sausage sandwich — an item you can’t get in NYC.
And despite the popularity of places like Takashi, it can still be a struggle to get diners to try their meat raw. Mena only serves venison tartare on his tasting menu, where there are no substitutions. “I would never put it on the regular menu,” he says. But one can’t argue with the reaction. “It was very positive,” says Mena. “The customers might not have ordered [it if it was served à la carte], but 99 percent of people would finish it.”
Read more: http://www.nypost.com/p/entertainment/food/they_like_it_raw_U1hn0eFWD4rCY2KlDQdm6L#ixzz1qRClL3TG
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