Wednesday, June 19th, 2013

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*List news by publisher » Microsoft Loosens Xbox Game Policies
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What FedEx?s Earnings Say About the Global Economy
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', this, event, '150px')">EL-ERIAN: The Fed Better Be Right About The Economy
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The British government is considering breaking up Royal Bank of Scotland Group, the country’s Treasury chief said Wednesday, a potentially radical move that underscores policy makers’ mounting frustration with their inability to arrest a five-year banking crisis. George Osborne, the U.K.’s Chancellor of the Exchequer, said the Treasury “will urgently investigate” the case for splitting…

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Tags: also still looking for a CEO if anyone\'s interested, breakups, George Osborne, RBS

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The Brazilian protests, which swept through the country with the raging bear market (and the pulled mega-IPO) over the past week, and which had the goal of reducing a recent bus-fare increase among other assorted protest goals, appear to have succeeded. At least when it comes to the fare increase. As for the other protester demands, listed below, it may take a little longer.

AP reports:

Brazilian leaders in Sao Paulo say they are reversing a 10-cent hike in bus and subway fares that has sparked widespread protests across the nation.

Sao Paulo Mayor Fernando Haddad and Sao Paulo state Gov. Geraldo Alckmin said at a joint news conference Wednesday that the fare increase is now reversed.

However, it was not clear what impact the action would have on the protests that have broken out in several Brazilian cities.

The protests have evolved into communal outcries that have moved well beyond the original demand that public transportation fares be lowered.

Protests are continuing in Rio\'s sister city Niteroi and in northeastern Brazil.

The good news: protests still work in some cases. The bad news: a 10 cent fare increase is a far more manageable issue to resolve than corruption, violence, police repression, and corrupt politicians which are some of the other protest causes.

Then again, at least the Brazilians are protesting for change: in the US, one only has to consider the epic indignation that the recent NSA spying scandal has unleashed and the mass throngs of people demanding a return of their constitutional rights. Oh wait...

    ', this, event, '150px')">Brazilian Protests Succeed In Reversing Bus, Subway Fare Hike
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Larger Rival to Acquire 3-D Printing Start-Up MakerBot
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Casey Research\'s energy report discusses, countries that are not now known for their oil and gas production are showing much shale oil and gas promise.

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Brazil\'s Globo news outlet reports .

The mayor of Rio said public transport fares will be reduced to R$ 2.75 from R$ 2.95, Globo says. In São Paulo, the Governor and Mayor announced train, subway and bus fares will be $R instead of R$ 3.20.

NPR\'s Eydar Peralta reported earlier today 11 other cities had already bowed to pressure to reduce fares.

Brazil deployed special federal police Wednesday after a third day of protests broke out across the country, AlJazeera said.

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', this, event, '150px')">REPORT: Brazil Caves On Bus Fare Hikes
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Stratasys buys Makerbot 3-D printing company for $400 million
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Alliance Bernstein\'s Vadim Zlotnikov Gives Us The Argument For Active Management (Business Insider)

After the financial crash there has been a loss of confidence in active management as passive investing strategies have outperformed. Vanguard\'s Jack Bogle has built his entire reputation on passive investing, or investing in stock market indices.

Yet there is an argument to be made for active management, according to Vadim Zlotnikov, chief market strategist at Alliance Bernstein

\"Active management relies on the assessment of economic value in determining pricing of securities and assets. The last four years you have seen a significant divergence between the economic value of assets and its price in the market.

\"Active management is all about assuming that over long periods of time, pricing of securities and their values starts to converge. So the issue is not if it is going to work, it\'s when it\'s going to work. The time for it to work is when you have enough decline in the risk perception to at least believe that the future will exist and the future in some way, shape or form will be driven by historical rules. What has happened people have said is all these historical beliefs are no longer valid we\'re in a new world.

\"If you start to have at least some comfort that historical economic rules are valid going forward, active management will deliver enormous returns. And you\'ll see that in some pick in M&A, some pick up in LBO, because those are the long horizon economic buyers. They\'re not buying paper, they\'re obeying an underlying business and those are the guys that are willing to place capital against that arbitrage.\"

U.S. Target-Date Funds Saw 20% Growth In Assets Last Year (Reuters)

Assets in target date funds grew 20% in 2012, according to data from BrightScope. Target date funds are funds that pool together money from different investors that plan to retire around the same time, and in which asset allocation tends to become more conservative as this date approaches.

Target date funds had over $503 billion at the end of 2012, according to Brightscope. Recently, companies like Goldman Sachs and Oppenheimer Funds have exited the market, according to Reuters.

Here\'s The Chart That Predicts Recessions \'Without Fail\' (Gluskin Sheff)

\"If there is one metric that has worked so well over time it is household assessments of the labour market — the consumer sector tends to get it right,\" wrote Gluskin Sheff\'s David Rosenberg.

\"Specifically, the University of Michigan survey component that measures consumer expectations on expected changes in unemployment rate. As the chart clearly illustrates, recessions start when this metric slips below 65 without fail. We will start to get worried then when it breaks below 75 (it is now 96) as it did in August 2007, December 200, and May 1990 — all gave us 2-4 months of preparatory time ahead of the fact.\"

FINRA Requests Information On How Brokerages And Their Top Representatives Are Using Social Media (WealthManagement.com)

Financial Industry Regulatory Authority (FINRA) is keeping an eye on how brokerages are using social media like Facebook, Twitter, and LinkedIn. The regulator sent letters to brokerages requesting information on how they monitor the use of scale media and if it complies with industry standards, according to WealthManagement.com.The regulator also requested a list of the firm\'s \"top 20 producing registered representatives (based on commissioned sales) who used social media for business purposes to interact with retail investors as defined in FINRA Rule 2210(a)(6) during the time period February 4, 2013 through May 4, 2013.\"

GUNDLACH: The Only Place Investors Will Make Money In The Coming Weeks Is \'The Most Hated Asset Class On The Planet\' (CNBC)

While many on Wall Street expect Treasuries to continue selling-off after today\'s FOMC announcement. Jeff Gundlach think U.S. Treasuries are set to rally.

\"No one\'s making any money anywhere, and I think that\'s because people think the conviction of central banks to continue the amount of monetary stimulus through bond purchases is less. And that\'s where we are right now. That\'s what\'s going to happen today again...

\"I think, actually, rates are going to start falling. I think the place – the one place – that you\'re likely to make money in the next several weeks, maybe couple of months is actually, believe it or not, the most hated asset class on the planet: long-term U.S. government bonds.

\"That\'s what I think is going to be the most successful investment, and what I\'m really looking at to reach that conclusion is the fact that there is no inflation anywhere. There\'s no sign of inflation.\"

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', this, event, '150px')">FORGET JACK BOGLE: AllianceBernstein Makes The Case For Active Portfolio Management
(3 hours ago via Clusterstock)

told Wall Street Journal reporter Jon Hilsenrath he never predicated his arguments against Fed easing on inflation fears.

Of course, the lack of accelerating inflation over the past few years is in part what\'s allowed the Fed to continue its bond buying program and keep interest rates low.

Here\'s the exchange:

HILSENRATH: People have been saying for 3 or 4 years, \'Inflation inflation inflation!\' Show me! Show me...

SANTELLI: NO no no no no, that\'s not the issue. THE issue is, you\'re not going to have a lot of inflation showing up when you have no velocity. I\'ve talked about commodity price volatility in the past, go back to the tape…I never said it was about inflation.

But this \"Santelli Exchange\" segment from Oct. 2012 (via Zerohedge) certainly seems to suggest otherwise. In it he warns about how the seeds of Weimar were being sown by the Fed:

\"To be nor not to be — of course I\'m talking about inflation. But what\'s very interesting is, as I look up at gold — of course it\'s reversed off its highs — but today it hit a high of $1794.40. That\'s the highest intraday level for 2012, indeed it goes back to November last year when we traded over $1,800. But the issue is ,\'To be nor not to be?\' Is it inflation vacation or inflation gestation?…Let\'s consider a couple of things. Printing money — is it really the answer? ... If we just print a million dollars for every man woman and child in the country, and handed it to them, won\'t that fix everything? Because in order to really look at printing — I like to take everything to the extreme...Look at the Weimar Republic and their hyperinflation in the early \'20s. It didn\'t happen overnight, I\'ve ued the analogy, it\'s a lot like soybeans you plant em, you wait, conditions take some time, you need some sun you need some water, but ultimately things start to grow, and are we in that phase or not?\"

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', this, event, '150px')">Rick Santelli Caught Contradicting Himself About Past Inflation Warnings
(3 hours ago via Clusterstock)

B.I.G. Tips report sent out to our Premium subscribers yesterday, we noted that when the market is down at noon on Fed days, it typically continues lower for the remainder of the day. Today was the worst Fed day for the market since September 21, 2011 when the S&P 500 fell 2.94%. So what kind of follow-through should we expect in the days ahead? Will the market continue lower or bounce back?

Below is a table of all Fed days since 1995 that have seen the S&P 500 fall by more than 0.75%. Today was just the 20th time it has happened out of a total of 149 Fed days (non inter-meeting days). For each of the prior 19 days, we highlight the S&P 500\'s performance on the following day, over the next week and over the next month. As shown, on the day after these big down Fed days, the S&P 500 has averaged a move of...

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Tags: Bank of America, Citigroup, gray areas, JPMorgan, little guys, mortgage settlement, NBD, not that Joseph Smith, Wells Fargo

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Perhaps more importantly, today for the first time someone, not Hilsenrath of course, had the guts to ask Bernanke the hardest question: is the Fed\'s \"Stock not Flow\" worldview broken, and was it wrong all along? Of course, the implications of the Fed being wrong on this most critical aspect of monetary theory opens up a hornet\'s next of Pandora\'s boxes: just what else is the Fed wrong about, and how much will Bernanke be \"puzzled\" when one by one all of his flawed theories are revealed to be nothing but religious dogma.

And finally what happens to the BOJ when it too has to \"taper\" and it too realizes that it is all about the flow (in a country where the central bank is monetizing at a relative pace which is more than double the Fed\'s), and the second sentiment shifts, the entire liquidity bubble comes crashing down, taking not only Japan, but Europe - which is funded courtesy of the Japan carry trade - down with it?

To summarize: bonds collapsing - no worries... it\'s still the Stock... although not really... and optimism.

From today\'s press conference:

QUESTION: Mr. Chairman, you\'ve always argued that it\'s the stock of assets that the Federal Reserve holds which affects long-term interest rates.

How do you reconcile that with the very sharp rise in real interest rates that we\'ve seen in recent weeks? And do you think the market is correctly interpreting what you think is most likely to be the future path of the Federal Reserve\'s stock of assets? Thank you.

BERNANKE: Well, we -- we were a little puzzled by that. It was -- it was bigger than can be explained, I think, by changes in the ultimate stock of asset purchases within reasonable ranges, so I think we have to conclude that there are other factors at work, as well, including, again, some optimism about the economy, maybe some uncertainty arising. So I\'m agreeing with you that -- that it seems larger than can be explained by a changing view of monetary policy.

It\'s difficult to judge whether the markets are in sync or not. Generally speaking, though, I think that what I\'ve seen from analysts and market participants is -- is not wildly different from what, you know, the committee is thinking and trying -- as I tried today to communicate, I think the most important thing that I just want to convey again is -- is that it\'s important not to say this date, that date, this time.

It\'s important to understand that our policies are economic-dependent, and in particular, if financial conditions move in a way that make this economic scenario unlikely, for example, then that would be a reason for us to adjust our policy.

It\'s really the stock, stupid... (right?)

BERNANKE: And by the same token, as long as we\'re buying assets, we\'re adding to our holdings.

We do believe -- although, you know, there\'s room for debate -- we do believe that the primary effect of our -- of our purchases is through the stock that we hold, because that stock has been withdrawn from markets, and the prices of those assets have to adjust to balance supply and demand, and we\'ve taken out some of the supply, and so the prices go up, the yields go down. So that seems to me consistent with the -- with the idea that we\'re still adding liquidity, we\'re still adding accommodation to the system.

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The networking giant noted there\'s the potential for companies to generate as much as $14.4 trillion in revenue over the next decade (2013-2022), as more devices become connected to the grid. Companies are expected to generate at least $631 billion in profits this year (there\'s an additional $544 billion in value that\'s left on the table for 2013), so the far majority of the opportunity lies in the years ahead.

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From the 1960s onwards - a little earlier in Japan - the total support ratio rose everywhere and more or less continuously, until about 1990 in Japan, and 2005-2010 in the US and Europe.

The peaks coincided pretty well with the peaks in economic expansion and asset markets. The turn down in the total support ratio, however, is significant because it represents the combination of the negative, second-round effects of falling fertility on the working age population, the end of the fall in youth dependency, and, importantly, the point at which rising total dependency is exclusively down to the increase in old age dependency.

Japan?s support ratio is now approaching 1.5 workers per older citizen, and is predicted to carry on falling to parity in the middle of the century. The US and Europe are predicted to follow Japan, though support ratios are not expected to fall as far.

Demographic weaknesses in the labour market, exacerbated by the on-going balance sheet recession, are contributing to a loss of consumer, homeowner, and entrepreneurial mobility and flexibility. This undermines the productivity and higher labour force participation, which constitute two important coping mechanisms for population ageing.

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Ben Bernanke\'s subsequent press conference sent bonds tumbling.

The chart below shows the exact moments that triggered the sell-off in 10-year Treasury futures that caused bond yields to soar today.

The initial leg down in bonds came right after the release of the FOMC statement and updated macroeconomic forecasts at 2 PM ET. The FOMC is more optimistic on the economy than before, which means tapering back of bond purchases under the central bank\'s program of monetary stimulus will probably come sooner than previously expected.

The second, more notable, leg of the sell-off was triggered around 2:45 PM by Bernanke\'s response to a reporter\'s question about the sell-off in the Treasury market over the past several weeks that has sent bond yields soaring.

Bernanke said, \"Yes, rates have come up some. That\'s in part due to more optimism – I think – about the economy. It\'s in part due to perceptions of the Federal Reserve. The forecasts that our participants submitted for this meeting, of course, were done in the last few days, so they were done with full knowledge of what happened to financial conditions. Rates have tightened some, but other factors have been more positive – increasing house prices, for example.\"

Then, Bernanke concluded, \"If interest rates go up for the right reasons – that is, both optimism about the economy and an accurate assessment of monetary policy – that\'s a good thing. That\'s not a bad thing.\"

In other words, please proceed. And the bond market did just that.

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It’s a legitimate question and when legitimate questions need answering, there is no group of people more fit to answer them than the Dealbreaker community. So let’s get right to it. The facts: Ben Bernanke’s second term as Chairman of the Federal Reserve ends on January 31, 2014. Ben Bernanke has “already stayed a lot…

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Apparently, the highlight of the round-up of the G8 summit in Lough Erne might just have been that David Cameron went for a morning dip to swim a couple of lengths. That?s about as far as he might have got anyhow, considering that little all else was decided.

But, hey, it doesn?t matter. The G8 only cost a whacking $50 million in running costs for security. That?s eye-watering. All of that so that we could see Vladimir Putin pouting in press conferences because the others didn?t want to play cowboys and Indians with Syria?s Bachar Al-Assad.

But what exactly has come out of it all? The money, the guys and the one girl with no ties, that cool, no-flies-on-me look as if they were all buddies. Then came the press conferences with the pouting and the scowling as if the KGB, MI5 and the CIA were standing there behind them all breathing down their necks at the same time. Have we all paid for that? Let?s face it. If I?m paying, I want to see a smile on their faces, at the very least. The pizza-delivery guy has to do it when he turns up at the door. The till operator has to do it when she has been scanning your tea-bags all day long. We don?t care how long people have to work, but they have to smile. Especially, when I?m paying for it. So, why were there no smiles at the G8? Easy to understand why.

G8: Obama and Putin

Tax evasion was the point that was the highest up on the agenda for the two-day summit. A set of principles were agreed. Is that all? Principles? I have principles. We all do. Just depends along what scale of measurement that we are using. It was agreed, therefore, in principle, that they would all share tax information and stop countries shifting profits from one country to another so that they could avoid tax. But, principles have limits, don?t they? Nobody wanted to agree to go too far. Registers of public ownership will not be published and transparency is not the order of the day. A little. Maybe a little a lot. But, not too much. New feeding method of the public? Obama went as far as to say that that US tax information being made public would have an adverse effect if corrupt nations got to see what they were doing. Really? The UK?s overseas territories signed up and agreed to the principles, in principle.

The principles have been lambasted as nothing more than ?windy?. Probably, only on principle though. Whatever happens anyhow, we know that the tax evaders will not be waiting for the G8 to catch up with them before they decide to change tactics and exploit another loophole. Oh, the joys of politics. Long, hard and very slow slog, in principle.

Vladimir Putin was sticking to his principles too with regard to Syria. Naturally, recognizing that something had to be done to aid the population of Syria in the face of Al-Assad, would mean that Putin would have to forgo his arms deals with that country. It would also perhaps question the principle of Putin?s own regime and how it deals with its opposition. Some are saying that the next G8 summit in which Russia will assume the presidency (June 4th_5th2014, Sochi, Russia) will be another time for sour grapes and sulking. But, there are quite a few others that are demanding that the world take action to help the Syrian population out of their present plight and that something should be done way before 2014.

We shouldn?t forget either that principles were also decided upon concerning EU-US trade. Figures were branded about that would bring in ?119 billion a year for the EU and ?95 billion for the USA. Not bad! But, just how that is going to happen has yet to be decided upon. But, the principle is there! The US and the EU will be working together on this one to make sure that we all help each other out. But, it seems that they forget to address the principle of lack of stimulus and growth in the economy. That?s a harder one to deal with, surely.

The G8 summit closed with camaraderie and back-slapping. Words like ?potential? were branded about and ?success?. But, maybe that was just out of principle too!

But, out of principle, maybe, nobody seems to give two hoots, anyhow. the only thing that is worrying everybody at the moment is the Federal Reserve and what Ben Bernanke is going to announce.

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term we coined over a month ago would suddenly get so much airplay: why, it was none other than billionaire hedge fund investor David Tepper who said days later (and just in time to top tick the market) not to fear the taper, that it is a bullish sign. Looks like it wasn\'t. But at least Tepper sold everything he had to sell by now so someone is happy. As for what happens next, nobody still has any idea, although the first, and so far best, post-mortem of Bernanke\'s predicament comes from SocGen, whose opionion is simple enough: FOMC on track for September tapering.

From SocGen:

FOMC on track for September tapering

Today, we expected Bernanke to provide more helpful guidance on asset purchases and on eventual exit steps. We got what we wanted. Bernanke reiterated that tapering is likely to begin ?later this year? and end around mid-2014, i.e. when unemployment reaches 7%. Regarding exit principles, the only new colour was that the majority of the FOMC is now against ever selling the Fed?s MBS holdings.

Tapering guidance much improved

We?ve complained in the past that the guidance on asset purchases was too vague and flat out unhelpful. The Fed made a large step today toward addressing our concern. Rather than laying out specific conditions for tapering, Bernanke suggested that if incoming data is broadly consistent with the Fed?s forecast, it will be ?appropriate to moderate the monthly pace of purchases later this year.? The Fed projects that the unemployment rate will average around 7.4% in the fourth quarter (vs. 7.6%) today, which implies that the Fed sees a 7.5% level or thereabouts as consistent with tapering. After that, Bernanke suggested that the Fed will continue to reduce the pace of asset purchases through the first half of 2014, or until unemployment falls to roughly 7%. This would imply a roughly $10bn reduction in asset purchases per meeting.

The new guidance on tapering is broadly consistent with earlier hints, notably with the three conditions laid out in the minutes of the May meeting. At that time, most participants saw three criteria for tapering: continued progress on employment, improved confidence in the outlook, and reduced downside risks. It was probably not coincidental that the only changes in today?s FOMC statement alluded directly to two of those three conditions. First, in the economic assessment, the language on labor market conditions was changed from ?have shown some improvement? to ?further improvement?. And, the statement significantly downgraded downside risks to the economic outlook.

Back to data watching

The Fed?s economic forecasts have become an implicit benchmark against which investors should be evaluating incoming data and re-pricing the timeline on asset purchases. The Fed expects growth to average around a central tendency range of 2.3%-2.8% (or a midpoint of 2.5%) this year. Since Q1 GDP expanded by 2.4%, i.e. broadly in line with the full-year forecast, we simply need to see more of the same. Employment growth has averaged at 175,000 jobs per month so far this year vs. 80,000/month trend growth of the labor force. A mere continuation of this performance will continue to put downward pressure on the unemployment rate.

Our central scenario

We maintain our call for a September tapering. Prior to today?s meeting, we had assumed that asset purchases would come to a full stop by the January meeting. While Bernanke?s guidance suggested that buying will continue until mid-2014, our own forecast trajectory hits the 7% level of unemployment a bit earlier, before the end of Q1. We therefore still see the risks skewed toward a shorter tapering cycle than consensus currently assumes. After that, there is likely to be a long pause in Fed policy. Rates are still on track to remain at zero until 2015, and in fact Bernanke hinted that at some point the Fed could lower the 6.5% threshold for rate hikes. We assume that MBS runoff and reserve draining operations will begin about 6 months before the liftoff in rates, i.e. in late 2014. MBS asset sales now look unlikely, but it is not clear at this stage whether the Fed will reduce its Treasury holdings through sales or redemptions, or simply maintain a large balance sheet and allow the economy to grow into

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most were expecting Federal Reserve Chairman Ben Bernanke to attempt to soothe markets.

After all, volatility in the Treasury market, caused by uncertainties surrounding how soon the Fed will begin to taper the pace of its bond-buying program, has had earthshaking reverberations around the world. (Volatility in the Japanese government bond market has increased dramatically, and emerging market stocks, bonds, and currencies have been getting crushed as Treasury yields have risen in the States.)

Instead, Bernanke and the Fed did just the opposite. The FOMC revised up its economic forecasts – implying a quicker economic recovery, meaning tapering is closer than previously assumed – and even laid out a roadmap for tapering, saying bond buying could be completely finished by mid-2014.

This development wasn\'t even borne out of the discussion in the Q&A with reporters – Bernanke had it ready to go in his prepared remarks to launch the presser. Guns blazing.

\"If the incoming data are broadly consistent with this forecast, the Committee currently anticipates that it would be appropriate to moderate the monthly pace of purchases later this year,\" said Bernanke, referring to the FOMC\'s newly-released macroeconomic projections. \"And if the subsequent data remain broadly aligned with our current expectations for the economy, we would continue to reduce the pace of purchases in measured steps through the first half of next year, ending purchases around mid-year.\"

Bernanke went on to say that \"in this scenario, when asset purchases ultimately come to an end, the unemployment rate would likely be in the vicinity of 7%, with solid economic growth supporting further job gains.\"

\"Bottom line - no backing down, no turning back, the Fed will taper unless the data deteriorate,\" said Société Générale strategist Kit Juckes following the presser. \"There is debate, but the fact the vol has not prompted second thoughts seems to me key.\"

Indeed, when pressed during the Q&A about the recent surge in Treasury yields, Bernanke said, \"Yes, rates have come up some. That\'s in part due to more optimism – I think – about the economy. It\'s in part due to perceptions of the Federal Reserve. The forecasts that our participants submitted for this meeting, of course, were done in the last few days, so they were done with full knowledge of what happened to financial conditions. Rates have tightened some, but other factors have been more positive – increasing house prices, for example.\"

The bond market did not take the tapering road map nor Bernanke\'s assessment of Treasury market volatility very well. Treasuries, which were already taking a hit following the release of the 2 PM statement and forecasts, really started selling off as Bernanke spoke.

The yield on the 10-year Treasury note hit a high of 2.33% during the presser (versus levels around 2.21% before the 2 PM releases).

For now, it appears that the FOMC is undeterred by recent volatility in the Treasury market, and that\'s something investors should keep in mind.

ALSO ? FORMER FED GOVERNOR: Obama \'Basically Fired Ben Bernanke On The Spot\'

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Commodities were a one way street...

FX markets exploded with the USD bid (and if the bulls think carry will save the day - think again - this kind of vol means LESS carry not more)...

The Dow saw its 7th day of +/-100 p[oint days - first time since oct 11

Charts: Bloomberg and Capital Context

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statement and updated economic forecasts at 2:00 PM ET. The big takeaways were that the Committee saw \"further improvement\" in the labor market and said downside risks to the economy have diminished since autumn. They also significantly lowered their inflation expectations. It\'s worth noting that the Fed revised its 2014 unemployment rate forecast to a range of 6.5% to 6.8%, down from a previous range of 6.7% to 7.0%. In case you forgot, the Fed said at its December meeting that it would use unemployment rate and inflation rate thresholds to guide monetary policy. And its unemployment rate threshold is 6.5%. This suggests that the Fed may be warming up to the idea of tightening monetary policy sooner than later. Bernanke also addressed the taper, or gradual reduction, of its quantitative easing, or bond-buying, plan. Specifically, he said that if the Fed\'s economic forecasts hold, then it would be \"appropriate to moderate the pace of purchases later this year,\" ending mid-2014. Sixteen Economists Predict When The \'Taper\' Will Begin > Increasing optimism toward the economy and the prospect of a taper in the near-term appeared to be the catalyst for an interest rate rally. It also appeared to spook the stock market, which immediately crumbled. Don\'t Miss: GOLDMAN: Here Are The 6 Most Interesting Charts In The World Right Now >

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The question is - if the macro situation is so clearly weak, juist why is he is discussing a taper (if not because he knows he has broken the markets)

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http://gainspainscapital.com/protect-your-portfolio/

Best Regards

Graham Summers

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Alabaster & Chess.

But if you dread the thought of wearing business attire for any longer than you have to, there are also a few tricks to minimizing wrinkles, even if you\'re packing in a carry-on suitcase.

In the video below, Chess shows us the right way to pack a suit for a business trip.

// &lt;div&gt;Please enable Javascript to watch this video&lt;/div&gt;

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Dietz said IBM\'s portfolio of 100 cloud solutions applications is just what\'s needed to diffuse this tension because the comprehensiveness of the suite caters to multiple lines of business executives. ...

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At Bernanke\'s press conference he put it this way.

Bernanke: If forecast holds, \"appropriate to moderate the pace of purchases later this year,\" ending mid-2014.

— Binyamin Appelbaum (@BCAppelbaum) June 19, 2013

For full coverage of the press conference, see here.

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', this, event, '150px')">BERNANKE: If Our Economic Forecast Holds, Then The Taper Could Begin Later This Year
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Swiss parliament rejected a bill designed to resolve a dispute over undeclared bank accounts held by U.S. citizens, potentially setting the stage for American prosecution of the country?s banks. Members of parliament?s lower house voted 123 to 63 against the bill, which would have allowed Swiss banks to cooperate with the U.S. and to settle…

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Tags: shit just got extra real, Switzerland, tax evasion, they can take our lives but they\'ll never take our freedom to help wealthy Americans evade taxes

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abrupt and bizarre departure:

\"Over the last 40 years, I have built MW into a multi-billion dollar company with amazing employees and loyal customers who value the products and service they receive at MW. Over the past several months I have expressed my concerns to the Board about the direction the company is currently heading. Instead of fostering the kind of dialogue in the Boardroom that has in part contributed to our success, they Board has inappropriately chosen to silence my concerns through termination as an executive officer.\"

Zimmer\'s firing was announced in an icy company statement that implied he wouldn\'t be a part of Men\'s Wearhouse going forward. The company also postponed its annual shareholders meeting, scheduled for tomorrow.

Regardless of drama on the board, the company has been doing great. Men\'s Wearhouse just announced a 23% profit increase last week.

Here\'s the statement Men\'s Wearhouse released about Zimmer\'s termination:

FREMONT, Calif., June 19, 2013 /PRNewswire/ -- The Board of Directors of Men\'s Wearhouse (NYSE: MW) today announced that it has terminated George Zimmer from his position as Executive Chairman. The Board expects to discuss with Mr. Zimmer the extent, if any, and terms of his ongoing relationship with the Company.

In light of Mr. Zimmer\'s termination, the Company also announced that it is postponing its Annual Meeting of Shareholders, which had originally been scheduled for June 19, 2013, at 11:00 a.m. Pacific daylight time. The purpose of the postponement is to re-nominate the existing slate of directors without Mr. Zimmer.

The Company expects to announce the rescheduled date, time and location of the postponed Annual Meeting shortly. The Company will set a new record date, provide additional information with respect to the Annual Meeting in a supplement to its proxy statement to be filed with the Securities and Exchange Commission and commence a new solicitation with respect to the supplemented proxy materials. Shareholders are urged to read the supplement in its entirety, as it will contain important information about the Annual Meeting.

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December meeting, the Fed said it would use unemployment rate and inflation rate thresholds to help guide monetary policy.

Those thresholds: 6.5% unemployment rate and 2.5% inflation rate.

This suggests that the Fed may be warming up to tighter monetary policy sooner than later.

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', this, event, '150px')">A Very Important Hawkish Number Appeared In The Fed's Announcement
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latest FOMC statement on monetary policy, and bonds are taking a hit.

Before the release at 2 PM ET, the yield on the 10-year U.S. Treasury note was hovering around 2.21%. Following the release, the 10-year yield is up to 2.26%.

In addition to the FOMC statement, the Fed also released updated macroeconomic forecasts.

Given the language in the statement, which paints the economic recovery in a positive light, and the updated forecasts, which now assume lower unemployment and higher GDP growth than before, bonds are selling off.

The Fed has been adamant that it will only begin to taper back the pace of bond purchases it makes under its quantitative easing program of monetary stimulus when the economic data show enough improvement to justify such action.

The fear is that the Fed is starting to recognize improvements in the economy, and may as a result be more inclined to begin the tapering sooner than later.

Join the conversation about this story »

', this, event, '150px')">Bonds Getting Slammed After The Release Of The FOMC Statement
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The central fed tendency: i.e., pretty blue charts

Just as notable: 4 of 19 FOMC members saw the first firming take place before 2015.

Finally, looking at the short end, 3 FOMC members saw a 1% Fed Funds rate by the end of next year, with one expecting for a 1.5% print. Still, the bulk of Fed economists are not too worried about the short end of the curve until 2015.

Source

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Stocks - sold; Bonds - sold; Gold - sold; USD - bought.

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Bespoke Morning Lineup. The Bespoke Morning Lineup is your pre-market source for up-to-date information concerning market events overnight and in the morning. On a daily basis, we summarize major international market events, stock specific news of note, analyst actions, and economic indicators/events. In addition, we also outline what major indicators, events, earnings reports, conferences, dividends, splits, and upcoming index changes are due the following day so that you can plan ahead and be ready.

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