Pick Pocket Culture Gone Wild

Sometimes to make a correct assessment of reality one must pay close attention to what is being said about you or something. Here is some interesting commentary on derivatives and financial product design.

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“The majority of Americans seem OK with just waddling through life, accepting the lies and misinformation blasted from the boob tube and their various iGadgets by their owners, gorging themselves to death on Twinkies and Cheetos, paying 15% interest on their $10,000 rolling credit card balance, and growing ever more dependent on the welfare/warfare state to provide and protect them from accepting personal responsibility for their lives. A minority of critical thinking people have chosen to question everything they see and hear being spewed at us by the propagandist mainstream media. What do ‘we, the people’ want? As it seems the entitlement “free shit” mentality permeates our culture. The question is whether we will stand idly by, fiddling with our gadgets, tweeting about Honey Boo Boo, or will we regain our sense of duty to the future generations of this country.”

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In order to help those who do not have access to proper financial and banking services the two companies will offer a pre-paid debit card called Bluebird. Competitor debit card companies saw their stocks fall on the news this morning.

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“(Reuters) – The largest U.S. weapons maker, Lockheed Martin Corp (LMT.N), said it plans to split its electronic systems business into two separate operations focused on missiles and training, a move it said would save $50 million and eliminate 200 jobs.

The change, effective December 31, will give Lockheed five business areas: aeronautics, space systems, information systems, missiles and fire control, and mission systems and training.

Marillyn Hewson, who currently heads the electronic systems business, is scheduled to take over as president and chief operating officer of Lockheed on January 1.”

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Analysts are lowering estimates and telling investors to brace themselves for a not so good earnings reports. Energy and materials are expected to lead to the downside in earnings.

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Scientists aligned with business always seem to make the same mistakes no matter what the industry is. That is what happens when you pay experts to producethe results you want.

The dangers of fracking are developing in Wyoming…

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Via B.I. the presentation is available for you to feast on….

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“Baby boomers took the economic equivalent of a king salmon from their parents and, before they passed it on, gobbled up everything but the bones.”

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Apple Inc. is anticipating a smash hit with the iPad mini. They have ordered 10mn units from suppliers according to sources.

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“WASHINGTON (AP) — American companies should avoid doing business with China’s two leading technology firms because they pose a national security threat to the United States, the House Intelligence Committee is warning in a report to be issued Monday.

The panel says U.S. regulators should block mergers and acquisitions in this country by Huawei Technologies Ltd. and ZTE Corp, among the world’s leading suppliers of telecommunications gear and mobile phones.

Reflecting U.S. concern over cyber-attacks traced to China, the report also recommends that U.S. government computer systems not include any components from the two firms because that could pose an espionage risk.”

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“(Reuters) – Marathon Petroleum Corp said on Monday it has signed a definitive agreement to purchase BP’s Texas City refinery, three intrastate natural gas pipelines and other assets in a deal worth up to $2.5 billion.

Marathon Petroleum’s shares rose to $56.38 in pre-market trading, after closing on Friday on the New York Stock Exchange at $54.87.

The U.S. company said it will also acquire an allocation of BP’s Colonial Pipeline Co shipper history, four terminals, retail marketing contract assignments for approximately 1,200 branded sites, and a 1,040 megawatt cogeneration facility.

The refinery has capacity of 451,000 barrels per calendar day and 475,000 barrels per stream day.

The base purchase price is $598 million, plus inventories estimated at $1.2 billion, Marathon Petroleum said.

The agreement also contains an earnout provision under which MPC could pay up to an additional $700 million over six years, subject to certain conditions.”

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“UnitedHealth Group Inc. will spend about $4.9 billion to buy a majority stake in a Brazilian health benefits and care provider, as the largest U.S. health insurer leaps into an international market it says is primed for growth.

UnitedHealth, based in Minnetonka, Minn., said Monday that it will pay cash for about 90 percent of the outstanding shares of Amil Participacoes SA. The Brazilian company provides health and dental benefits and runs a care delivery network that includes 22 hospitals, about 50 clinics. It serves more than 5 million people.

UnitedHealth currently operates in 70 countries, and its services include expatriate coverage for people living outside their home countries. But company spokesman Don Nathan said it had only a “very small” presence in Brazil before this deal.

The insurer’s international operations also represent a relatively minor slice of UnitedHealth’s total business, which is largely focused in the United States. UnitedHealth revenue totaled $101.9 billion last year. Nathan declined to say how much of that came from international markets.”

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“TOKYO (Reuters) – A polarized Washington that cannot find a way around the looming “fiscal cliff” is compounding economic uncertainty, freezing business investment and threatening growth, the IMF’s No. 2 official and its top-ranking American said on Monday.

In an interview with Reuters in Tokyo, IMF First Deputy Managing Director David Lipton said theUnited States needs to do more to show it is trying to address the expiring tax cuts and automatic spending reductions that will hit early next year unless Congress acts.

The looming fiscal tightening in the United States and the euro zone economic crisis are the two biggest risks facing the world economy, Lipton said. While most of the focus has been on Europe, Lipton stressed that the U.S. fiscal problems also posed a significant threat.

“We would like to see the United States lower the level of uncertainty by embracing more specifically the need to avoid the fiscal cliff and deal with the medium-term problems,” said Lipton, a former economic adviser to President Barack Obama.”

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EU finance ministers are meeting to discuss how to solve Spain’s debt problems. Officials are trying to avoid disruptions to the central bank fueled rallies around the world.

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“Gold fell for a second day in New York as some investors sold the metal after its rally to the highest in almost 11 months and as a stronger dollar curbed demand for an alternative investment.

The dollar climbed versus the euro as European finance ministers meet in Luxembourg today, while German Chancellor Angela Merkel visits Greece tomorrow for the first time since the crisis erupted. Gold futures reached $1,798.10 an ounce on Oct. 5, the highest since Nov. 9, before a report showed the U.S. unemployment rate fell to the lowest since January 2009.

“We’re seeing a stronger dollar which is translating into weaker gold,” Bernard Sin, head of currency and metal trading at bullion refiner MKS Finance SA in Geneva, said today by phone. “We’ve had a very good run-up. We’re seeing a bit of profit-taking.”

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“The World Bank said policy makers in Asia’s emerging economies have room to provide more fiscal stimulus as China’s slowdown drags the region’s growth to an estimated 11-year low in 2012.

Growth in developing East Asia, which excludes Japan and India, will probably ease to 7.2 percent from 8.3 percent in 2011, the Washington-based lender said in a report today. That is the slowest pace since 2001, according to World Bank data, and lower than a forecast in May of 7.6 percent.

The International Monetary Fund is set to reduce its global forecast for this year tomorrow at an annual meeting in Tokyowhere officials will tackle a slowdown triggered by Europe’s sovereign-debt crisis. Central banks are stepping up efforts to protect the worldwide recovery, with the U.S. expanding monetary easing, the Bank of Japan boosting its asset purchases and the Bank of Korea forecast to cut interest ratesthis week.

“On the monetary side, interest rates are already quite low and liquidity is relatively high in many other countries,” Bert Hofman, World Bank chief economist for East Asia and the Pacific, said in an interview with Bloomberg Television today. “On the fiscal side, there is clear scope, deficits are relatively low and debts are not very high.”

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Global markets and currencies took a step back after recent rallies on hopes Europe will contain the sovereign debt crisis.

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U.S. stock futures fell, following last week’s rally in benchmark indexes, as European finance ministers prepared to meet to discuss the region’s debt crisis.

Bank of America Corp. (BAC) and Monsanto Co. (MON) each retreated 1.4 percent to pace declines among the biggest companies. KeyCorp (KEY), Ohio’s second-largest bank, decreased 1.2 percent after Deutsche Bank AG reduced its recommendation for the shares. Netflix Inc. (NFLX), the world’s largest video-subscription service, advanced 6.4 percent after being raised at Morgan Stanley.

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The global economic recovery is on the ropes, battered by political conflicts within and across countries, lack of decisive policy actions, and governments’ inability to tackle deep-seated problems such as unsustainable public finances that are stifling growth. Growth in global trade has weakened and the spectre of currency wars, with countries looking to maintain export competitiveness by keeping their currencies weak, has returned to the fore.

The Brookings-FT Tiger index shows growth momentum has dissipated in nearly all major advanced and emerging market economies. Central banks of the major advanced economies have responded with a range of conventional and unconventional policy monetary policy actions. These measures have put a floor on short-term financial market risks but have been unable to reverse declining growth momentum. As a result, financial markets continue to go through short-term cycles of angst and euphoria even as indicators of real economic activity remain mired in weakness.

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Great analysis by Rhoads on the VIX and VXN, here.