“The finances of many states and cities are in dire straits, meaning many of them may join Detroit in bankruptcy, says former New York Lieutenant Gov. Richard Ravitch, an adviser to the bankruptcy judge in Detroit.

“The crisis is deepening,” he writes in The Wall Street Journal.

One major problem is that contributions to employee pension funds frequently fall short of the amounts necessary to make sure that benefits that are contractually or constitutionally guaranteed end up getting paid, Ravitch says.

Government officials want to keep contributions low to avoid raising taxes, and public unions want to avoid layoffs and benefit reductions, he writes.

“The most critical piece of the states’ fiscal dilemma is that they are borrowing to cover their operating deficits,” Ravitch argues.

As a result of state and municipal fiscal crises, investment in physical and human infrastructure is inadequate, which are “the necessary underpinning of future growth,” he maintains….”

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“Stocks are likely to take their cue from the bond market in the coming week, as traders worry low yields are a warning that the economy is not springing back.

Even with the choppy trading of the past week, the Nasdaq eked out a small gain while the Dow, S&P 500 and Russell 2000 were all lower. The 10-yearyield, a lightning rod for stocks, rose to 2.519 percent after better-than-expected housing starts Friday.

The week ahead is light on economic data, but much of what is available will have to do with housing—an area of concern. Existing home sales are Thursday and new home sales are reported Friday. There is also the release of minutes from the last Federal Reserve meeting on Wednesday afternoon, and about a half dozen Fed speakers will be discussing the economy throughout the week.

“The key indicator will be the yield on the 10-year,” said Art Cashin, director of floor operations at UBS. “Unless the saloon full of Fed speakers says something to move the market, you’ve got to watch the 10-year.”

Earnings from home improvement retailers Home Depot and Lowe’s are also expected, as are reports from Campbell Soup and Hewlett-Packard.

The 10-year yield, along with the entire Treasury curve, has been moving lower, reaching 2.47 percent Thursday, the lowest level since July. Some of the decline was due to short covering by investors. Yields, which move lower as bond prices rise, were also moving in lockstep with a global rate move, triggered by expectations the European Central Bank will announce a stimulus plan in June.

Cashin said a big concern for the market is deflation….”

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“(Reuters) – Top hedge funds shed their stakes in high-profile Internet names such as Netflix Inc and Groupon Inc in the first quarter, moving to peers viewed as more mature and less volatile.

High-growth Internet software and biotech companies were the darlings of 2013, but their shares started to fall sharply in early March. Netflix, last year’s biggest S&P 500 gainer and an important hedge fund holding, is down more than 24 percent from its closing high this year.

Hedge funds invested in technology and healthcare fell 3.65 percent in April, the biggest monthly decline since October 2008 and extending March’s 1.8 percent decline, according to data from Hedge Fund Research.

Among prominent hedge fund managers, Carl Icahn cut his holding in Netflix by 15.8 percent in the first quarter, reducing it to about 2.2 million shares. Tiger Global Management sold its entire stake of 663,000 shares during the quarter.

Netflix was up on the year for most of the first quarter, so the fund is likely to have sold at the right time.

Tiger also dumped its stake of 11.46 million shares in ….”

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So this article is a bit old, but interesting none the less. Enjoy!

“There are very few heroes in economics but for me one of the patron saints of that profession should be Nikolai Kondratiev who was shot by firing squad on the orders of Stalin in 1938. He died for what he believed was the truth. His execution was ordered because his academic work propounded that the capitalist system would not collapse as a result of the great depression of 1929. This truth Stalin did not want to hear, thus Nikolai was exterminated and his work suppressed for over two decades.

Kondratiev’s analysis described how international capitalism had gone through many such “great depressions” and as such were a normal part of the international mercantile credit system. The long term business cycles that he identified through meticulous research are now called “Kondratieff” cycles or “K” waves.

The K wave is a 60 year cycle (+/- a year or so) with internal phases that are sometimes characterized as seasons: spring, summer, autumn and winter:

• Spring phase: a new factor of production, good economic times, rising inflation
• Summer: hubristic ‘peak’ war followed by societal doubts and double digit inflation
• Autumn: the financial fix of inflation leads to a credit boom which creates a false plateau of prosperity that ends in a speculative bubble
• Winter: excess capacity worked off by massive debt repudiation, commodity deflation & economic depression. A ‘trough’ war breaks psychology of doom.

Increasingly economic academia has come to realize the brilliant insight of Nikolai Kondratiev and accordingly there have been many reports, articles, theses and books written on the subject of this “cyclical” phenomenon. An influential essay, written by Professor W. Thompson of Indiana University, has indicated that K waves have influenced world technological development since the 900’s. His thesis states that “modern” economic development commenced in 930AD in the Sung province of China and he propounds that since this date there have been 18 K waves lasting on average 60 years.

William R. Thompson:

“Most people are quite familiar with business cycles that tend to be denominated in terms of months. Sales are good, people are confident about the future, and unemployment is reduced. Then sales fall off, the immediate future seems gloomier, and unemployment increases. The Kondratieff wave is a longer version of economic fluctuation, albeit with the added traits of initial spatial concentration of technological innovation and subsequent diffusion at the world level. It also has some rather major implications for war, peace, and order in the world system that conventional, short-term business cycles lack. Therefore, the k-wave is a core component part of the most significant processes of the world system. Precisely what drives k-waves has been the subject of considerable analytical dispute. Arguments have been advanced that bestow main driver status on investment, profits, population growth, war, agricultural-industrial tradeoffs, prices, and technological innovations. This debate has by no means been settled but at this time the emphasis on technological changes appears to be the best bet…

In the case of the Kondratieff, the argument is that the first appearance of a paired K-wave pattern in economic innovations is found in the 10th century in Sung China which is sometimes credited with developing the first modern economy. The expansion of maritime trade in the South China Sea and the Indian Ocean, as well as the revived use of the Silk Roads on land, facilitated the transmission of long wave, paired growth impulses to the other end of Eurasia. Thus Modelski and Thompson analyze 18 k-waves encompassing some one thousand years between 930 and 1973…

In sum, the Kondratieff wave appears to be a highly pervasive and hence a critical process in the functioning of the world system. As such, it deserves more recognition than it currently receives. When more attention is paid to its influences, we will no doubt discover that it is even more central to world system development than we suspect currently.”

In addition to technology being a major factor in K cycles, credit and banking also play a crucial role. This is due to the fact that new technology spurs growth, initiative and risk taking. This mindset encourages investment and lending, thus, when the multiplier effect kicks in, economies expand rapidly. Thus, as we focus our analysis on more modern times we find that periods of “K” expansion and contraction bring with them phases of bigger booms and busts. The picture is doubly exacerbated by increasingly more integrated world funding mechanisms which means these booms and busts are global rather than local and increasingly more political than economic.

Implications for 2012 and Beyond….”

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[youtube://http://www.youtube.com/watch?v=xlzOSzO0p1U#t=54 450 300]

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“Former Federal Reserve Chairman Alan Greenspan said JPMorgan Chase & Co. is akin to Fannie Mae and Freddie Mac because taxpayers would shoulder the burden of its rescue in an emergency, rather than let it collapse.

JPMorgan, the nation’s largest bank, is an example of implicit government guarantees not measured in the nation’s official public-debt statistics, Greenspan, 88, said Wednesday at a forum in Washington organized by the Peter G. Peterson Foundation. The reality is that the government would prop up many financial firms and other companies if needed, he said.

“JPMorgan is a Fannie Mae-, Freddie Mac-type of institution, because they are indeed too big to fail, and taxpayer monies will come in behind them to hold them up if necessary,” said Greenspan. He sat on New York-based JPMorgan’s board before his appointment to Fed chairman in 1987.

Housing financiers Fannie Mae and Freddie Mac, which buy loans and package them into securities, were taken into government conservatorship during the financial crisis and received $187.5 billion in taxpayer funds to stay afloat before a market turnaround propelled them to record profits. The pair now back about two-thirds of new U.S. home-loan originations.

U.S. debt statistics should include a “very significant part of the financial institutions,” Greenspan said. Because the government also bailed out automakers and insurer American International Group Inc., the public debt includes “a lot of the nonbanking as well,” he said…..”

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“David Tepper, who made the most money of any hedge fund manager in 2013 at $3.5 billion, believes investors better approach the market with more caution now.

“I’m not saying go short, I’m just saying don’t be too fricking long right now,” the head of Appaloosa Management told a few thousand of his colleagues Wednesday at SkyBridge Capital’s SALT 2014 conference in Las Vegas.

Among his concerns are a deflationary environment, weaker-than-expected U.S. growth and a European Central Bank (ECB) that badly needs to ease monetary policy.

The result is a market that not that long ago was fairly easy to play but which is now getting trickier.

“Now I have a position (where) I’m long enough with exposure where I can bring it up or I can take it down,” Tepper said. “I am nervous. I think it’s nervous time.”

He is especially concerned about the ECB, which targets inflation at a lower rate than the U.S. Federal Reserve, which is looking to keep inflation below 2.5 percent.

Recent reports have indicated …”

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“Bob Doll, chief equity strategist at Nuveen Asset Management, says it’s finally full steam ahead for the U.S. economy — he is looking for 4 percent GDP growth in the second quarter, as the restraints from a harsh winter melt away.

In his weekly market commentary, Doll sees a host of reasons why he thinks the U.S. economy is gaining momentum.

Among them, he mentioned “significantly less fiscal drag” from the federal government, higher state and local government spending and an improving trade picture.

“A lagged impact of Fed stimulus is lifting the money supply and bank loans,” Doll said. “Consumer deleveraging headwinds and severe weather are behind us. The impacts of both the manufacturing and energy renaissances are broadening.”

Doll is heartened by the fact that first-quarter earnings marked the third consecutive quarter of higher corporate revenue and earnings per share growth.

“Several reasons support our view that second-quarter GDP growth will exceed 4 percent — decline in initial unemployment claims, increases in service sector activity, higher weekly mortgage applications and a solid rise in home prices.”

Doll mentioned two potential areas of concern, however.

First, he noted, U.S. corporate taxes are the highest in the developed world. “As the only industrialized country to double tax foreign sources of profits, U.S. companies may re-incorporate businesses outside the country to reduce the tax burden,” he warned.

Second, while he likes the fundamentals in the U.S. economy, Doll said the technical picture of the United States might not be as healthy at the moment….”

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“Despite some investors becoming increasingly wary of asset valuations, Sheila Patel, the CEO of Goldman Sachs Asset Management International, has told CNBC that the current bull market has longer to run and the search for yield will continue.

“I do think that there are places you can find value,” she told CNBC Wednesday.

“If you start to believe in the U.S. recovery there is certainly a school of thought that that’s the gorilla still in global growth. And if that is coming then emerging markets is a real place to take a second look.”

Following the financial crash of 2008, investment companies around the globe were restricted as stock prices plunged to historic lows. Investors fled for safe havens, shunning riskier assets, and central banks made government bond purchases to try to inject liquidity into economies.

The following five years – a typical duration of a bull market, according to some analysts – led to a search for yield across emerging markets, flickering signs of a housing recovery in the U.S. and interest rates on fixed income falling to record lows. Last year this culminated in a stellar rally for equity markets which saw both the Dow Jones and the S&P 500 break into fresh highs. Meanwhile, bond prices have shown signs of peaking and emerging markets have fallen out of favor as investors have returned to the U.S. dollar in the anticipation of rate hikes…..”

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“Despite the current administration’s track record on transparency (completely lousy from nearly every angle), there’s little being done by the majority of the press to work around the roadblocks being set up by the government. While the administration has offered a few half-measures aimed at reining in the NSA in the wake of the leaks, the ODNI (Office of the Director of National Intelligence) has gone the other way, forbidding employees from speaking to the media about even unclassified information.

The media claims to be more interested in exposing government wrongdoing than ever before, but it is less willing to get its hands dirty doing it, according to a study by the Indiana University of Journalism.

One of the most surprising developments over that period over the past ten years, is the steep decline in the percentage of journalists who say that using confidential documents without permission “may be justified.” That number has plummeted from about 78 percent in 2002 to just 58 percent in 2013. In 1992, it was over 80 percent.

That’s even more notable given that the survey took place from August to December of last year, not long after Edward Snowden became a household name for stealing classified documents that revealed the extent of NSA surveillance. The journalists who worked with him to share that information with the public won the Pulitzer Prize last month.

There are several theories as to the drop in the number of journalists willing to publish leaks or push reluctant individuals for information. Some of that is the political climate. The report notes that journalists identify themselves as Democrats at a rate of 4-to-1 over Republicans, so there may be some deferral to the “home team” administration. Backing this theory up is the fact that the highest numbers listed here were recorded during the two Bush presidencies.

Then there’s the general chill against whistleblowing, one that has never been colder than it is right now. It’s been well documented that the Obama administration has prosecuted more than twice as many whistleblowers than all other administrations combined. Post-Wikileaks and post-Manning, there aren’t too many journalism outlets willing to sacrifice freedom for a story.

Other, more questionable methods (hidden mics, confidential informants, buying documents), are on the decline as well. Again, the administration’s aggressive push to snuff out leaks is partly to blame, as well as the legal ramifications of questionable tactics deployed by UK tabloids, which have raised the ire of both that nation’s politicians as well as the targets of these “investigative” efforts. Better safe than jailed/fined/sued, it would appear.

But there’s another downside to this, one that plays right into the hands of the self-declared “most transparent administration,” as Kevin Gostola at Firedoglake points out.

The Associated Press found, when conducting its annual review of responses to Freedom of Information Act requests, that the “government more than ever censored materials it turned over or fully denied access to them, in 244,675 cases or 36 percent of all requests. On 196,034 other occasions, the government said it couldn’t find records, a person refused to pay for copies or the government determined the request to be unreasonable or improper.” The media organization concluded the “government’s efforts to be more open about its activities last year were their worst since President Barack Obama took office.”

First, you seal off the documents. Then, you start threatening the access. Faced with this, it appears many journalistic entities have decided to defer to authority and simply publish unquestioned statements from officials unwilling to back up their words with a name…..”

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“Back in the late 1990s, my wife was expecting our second daughter and we were really anxious to buy a home.

But the real estate market was soaring … prices were insane.

I can’t tell you how many times we lost out on a house we really liked because some other buyer was willing to pay 25% or more above the asking price – or was an “all-cash” buyer.

I never play that game – and never pay more than list.

Although real estate agents urged me to “look at the market” and “play the game” to get into a house, I refused. Overpaying, I knew, might work in the moment. But when the market got back to normal, I’d be left owning a house that was worth less than I paid for it.

You just can’t make money that way.

As it turns out, we ended up buying a great house for thousands under the asking price. Not only that, but the agents cut their commissions to make the deal and actually paid us cash to move in.

I’m telling you this tale for a reason.

My story underscores the importance of managing risk in a turbulent market.

And what’s true of real estate is just as true for stocks, including tech stocks. At their core, houses and tech stocks are both financial assets. Managed recklessly, they can drive you into the poor house.

But managed skillfully, they can make you rich.

During my 30 years as an investor, I’ve developed five tools for turbulent markets. Through the years, they’ve always turned the table to my advantage.

And today I want to share them with you.

With the Nasdaq Composite Index – and tech stocks in general – going through a turbulent stretch of their own, these five rules will help keep you from making mistakes.

My five rules will help you navigate the choppy markets we’re seeing right now. And, in the long run, they will help make you wealthy.

Choppy Market Tool No. 1: Make Lowball Offers

I understand why many investors are confused these days. After all, the markets are all over the place.

But don’t worry: These rules are a set of tools that, used correctly, will put your mind at ease in any kind of market. And, in the long run, they’ll help get you to the “Winner’s Circle” so you can profit.

By making crazy low offers in a torrid real estate market, I bought a home with built-in profits. It’s a time-honored investment principle: Make your money when you buy, not when you sell.

With stocks, it’s easy to make lowball orders. These are called “limit” orders, meaning you only buy when the stock hits your chosen personal target price.

Let’s say momentum investors have piled into XYZ Software Corp., causing it to double in a short amount of time. Now, it’s sold off a bit, and is locked in a directionless, “sideways” market.

You want to buy the stock for the long haul: It has great financials, strong management, excellent products, and a strategically sound position in a growing market.

Suppose XYZ had a recent high of $100 and then dropped to $75. A lowball limit order of, say, $60 (a 20% discount) will protect your risk of losses and greatly boost your long-term gains.

Remember to stay focused and disciplined. If your research has yielded a price that makes sense, stick to it. You can set it up so the lowball limit order automatically expires in 60 days, which is called “good till canceled.”

If the order doesn’t fill, don’t worry about it. You’ll have plenty more opportunities in the future.

Choppy Market Tool No. 2: Buy “Test Shares”

Buying test shares is a powerful way to turn the investing odds in your favor. And it works in any kind of market…..”

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“Edward Chancellor, a strategist at money-management firm GMO, believes U.S. stock prices are at bubble levels because “most of the conditions under which earlier bubbles have appeared are present in the U.S. markets today.” He lists eight such conditions, and warns that “this all bodes ill for long-term investors in U.S. stocks.”

The first three are “irrational exuberance, Ponzi finance and overblown growth stories,” he says in GMO’s quarterly letter to investors.

If you want an example of irrational exuberance, take a look at the initial public offering (IPO) market, Chancellor writes. “The IPO market in 2013 and into the first quarter of 2014 has become particularly speculative.” IPOs soared 20 percent on average in their first day of trading last year, he says.

Editor’s Note: 5 Shocking Reasons the Dow Will Hit 60,000

When it comes to Ponzi finance, “manic markets are often marked by a decline in credit standards,” Chancellor writes. “We have recently witnessed the lowest yields for junk bonds in history. The quality of debt issuance has been deteriorating.”

On the subject of overblown growth stories, investors have snapped up many of the market’s hottest growth stocks for reasons as flimsy as those used to justify buying of Internet stocks in the late 1990s, Chancellor says. Those hot stocks include shares in the social networking, biotechnology and Internet sectors.

Chancellor’s other five reasons why stocks are in a bubble include:

• “This-time-is-different mentality.” Bubbles often arise as investors reason that history no longer is relevant in predicting the future, Chancellor says. “Most commentary assumes that U.S. profits have reached, in Irving Fisher’s immortal phrase, a ‘permanently high plateau.'” Good luck on that, Chancellor writes.

• “Moral hazard.” When market participants believe the government will bail them out of financial problems, bubbles expand, he says. “Whenever a cloud appears over Wall Street, market participants have come to expect more quantitative easing and guarantees of perpetually low interest rates.”

• “Easy money.” Low interest rates go along with bubbles….”

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“By Mohamed A. El-Erian

U.S. financial markets have been in a familiar pattern, with stock indexes fluctuating to new highs while yields on 10-year Treasury bonds remain largely range-bound. Yet close observers should note some nuances that are likely to become more important in the weeks and months ahead.

As in previous weeks, two sets of corporate announcements supported stocks last week: earnings that tended to exceed (lowered) consensus expectations and new merger-and-acquisition deals. Central banks also helped meaningfully as both Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi reiterated their commitments to bolster economic growth while limiting the risk of damaging deflation. Draghi went even further, signaling that the ECB could boost its stimulus efforts next month.

Yet all was not smooth, contributing to quite a bit of intraweek volatility. Chinese and European data suggested that the global recovery is not as robust as many had hoped. Optimism about the impact of a perceived softening in Russian President Vladimir Putin’s position on Ukraine was dashed by disturbing on-the-ground realities. And investors showed little tolerance for any bad news from stocks with markedly high valuations.

Don’t expect this market tug of war to subside easily in coming weeks. Over the next few days, new data on U.S. retail sales, housing, inflation and industrial production will provide a fuller picture of the strength of the economic rebound from a weather-depressed first quarter, but they will not tip the balance decisively one way or another. That said, savvy investors will be keeping a close eye on two evolving trends that could well become more significant drivers of market behavior going forward.

First, the Fed is in the midst of a transition…”

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“Nomura’s Bob Janjuah has released an update on his market take.

Time has come to update my views. I have not written since late January as markets and economies have by and large moved as we expected back then. That late January note – which set out in detail my market views into April/May – is reproduced in its entirety below, and below each main bullet point I set out (in bold font) my latest views:

Bob’s World: Is it bear ‘clock now?

(original release date 27 January 2014)

It’s funny how – after not writing for over two months – I put a note out last week (highlighting some key levels) and within hours of publishing we have gone on to test and break some of these key levels. So in the spirit of the ongoing narrative:

1 – I remain firmly and resolutely structurally BEARISH the post-2008/09 QE-driven rally in risk assets. So no change there. As the year unfolds in both EM and DM we will, I think, see that most major and relevant data (economic) and earnings trends will be weak or deflationary. QE has so far failed to create the broad-based real economy inflation in incomes, earnings and productivity needed to get growth going again and thus has largely failed to achieve its primary objective, which was to drive the muchneeded post-2008/09 debt deleveraging – heavy indebtedness, now also including the EM bloc, still dominates.

May 2014 Update: The global data and earnings flow since January has supported my views outlined above, and over the belly (middle two calendar quarters) of 2014 I continue to expect downward growth and earnings revisions, with global deflation being the key macro theme. In particular, the risk of STRONG headline inflation, specifically in food prices driven by the Ukraine situation and by El Nino, and at the same time weak and weakening core inflation driven by weak income growth and soft discretionary consumption, will present a major (net) deflationary growth challenge to policymakers and markets.

2 – QE has been a friend for the paper wealth of the top 1%, at the expense of the many, through boosting speculation and financial engineering. But QE stopped being a friend of commodities in 2010/11, it stopped being a positive for EM around late 2012/13, has I think stopped being a positive for housing assets from around mid-2013/early 2014, and in 2014/15 the “last man standing” in the QE fan club – equities – will also fall out of love with QE. Why? Because as 2014 unwinds the data will, I think, expose policymakers as falling far behind the curve, persisting with a policy tool, whose “success” is increasingly narrowly based and which is failing to deliver broad-based inflation, growth or any other meaningful positives to the real economy, whose incomes, earnings and cashflows must ultimately validate all financial market asset valuations. I think later in 2014 the themes of deflation and recession will dominate, and in the middle of this it will I think be difficult to watch Fed Chair Janet Yellen and other policymakers flip flop and attempt to extract themselves from their policies.

May 2014 Update: No change of view – see update above. The waning of US housing data and the lack of growth in leverage by the US real economy (the private sector) over the past three to four months IMHO strongly support the views outlined above. And, it is now a consensus opinion, among many investors that I talk to, that we are dependent on policymakers and their willingness to persist with a set of policies that have largely failed real economies, but which have led to what many now increasingly see as speculative financial asset ‘bubbles’ in which the global top 1% has been the winner, largely at the expense of the other 99%. Civil society is the big loser. And while the top 1% may live comfortably in ‘gated communities’ and alike, this misses the bigger picture – the recent EM civil unrest shows clearly what can happen when wealth disparity gets too large (and which needs to be addressed sooner rather than later). The claimed ‘wealth’  effect and the trickle-down theory of economics are increasingly disputed and real redistribution policies are inevitable.

3 – We think that weak Chinese data explain last week’s price action….”

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“The U.S. Federal Reserve is in no rush to decide the appropriate size of its balance sheet, but if it ultimately shrinks it to a pre-crisis size, the process could take the better part of a decade, Fed Chair Janet Yellen said on Thursday.

Yellen, in testimony to a Senate panel, said no decision had yet been made on the central bank’s portfolio of assets, which has swollen to $4.5 trillion from about $800 billion in 2007.

Three rounds of asset purchases meant to stimulate the economy in the wake of the 2007-2009 financial crisis have boosted the balance sheet to this record level. Unsatisfied with the U.S. recovery, the Fed is still adding $45 billion in bonds each month, though the purchases should end later this year.

Yellen said the portfolio should start to shrink once the Fed decides to raise near-zero interest rates.

“We’ve not decided, and we’ll probably wait until we’re in the process of normalizing policy to decide, just what our long-run balance sheet will be,” she told lawmakers, adding it will be “substantially lower” than it is now.

While the central bank could sell the mortgage-based bonds it has accumulated, in the past it has telegraphed that it would more likely simply stop re-investing funds from expired assets and then, over years, let the assets run off the balance sheet naturally.

“If we do that and nothing more, it would probably take somewhere in the neighborhood of five to eight years to get it back to pre-crisis levels,” Yellen said of halting reinvestments.

It was the Fed’s most explicit time frame yet for the delicate task of shrinking its balance sheet to a more normal level. The massive portfolio has sparked worries that, once the Fed starts to raise rates, inflation will shoot up. The Fed could also absorb losses if it decides to sell assets in the years ahead, a potential political headache for Yellen.

The five-to-eight-year timeline generally aligns with estimates of both private economists and a paper published last year by top Fed economists. A paper by JPMorgan economists predicts shrinking the Fed’s portfolio would take seven years.

A COMMUNITY BANKER FOR FED BOARD

Yellen, in her second day of testimony before lawmakers, again stressed that low inflation drags on economic growth. But she rejected the idea, floated by some private economists, of trying to boost inflation above the Fed’s 2-percent target to ratchet down unemployment, saying it was critical to keep inflation expectations firmly anchored…..”

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“Long-term interest rates should remain low amid positive fundamentals for bonds, says financial market guru Jeremy Siegel, a finance professor at University of Pennsylvania.

“Everyone expected the 10-year [Treasury yield] to be 3.5 percent by now on its way to 4 percent. It’s closer to 2.5 percent,” he tells CNBC. The 10-year yield stood at 2.63 percent Thursday morning and touched a two-month low of 2.57 percent Monday.

Siegel admitted that he was part of the chorus predicting higher yields. “Now I think we’re going to have low interest rates on that long-term [bond] for quite a while now no matter what [Federal Reserve Chair] Janet Yellen says,” he argues….”

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“Companies seem to have found a sure-fire way to lift their stock prices: jettison their employees.

A total of 14 companies in the S&P 500 have erased jobs in each of their past five fiscal years.

And those companies’ shares have outperformed the index, USA Today reports.

The stocks increased 18.8 on average over the past year, besting the 15.5 percent rise for the S&P 500, according to the paper and S&P Capital IQ. Over the past five years, the job cutters lead the index 269 percent to 103 percent.

To be sure, not all the job losses stem from layoffs, USA Today notes. Some come from restructurings and divestitures.

In any case, leading the 14 companies in reducing headcount over the last five years is telecommunications equipment maker Motorola Solutions. Its workforce dropped 67 percent during the period, and its stock gained 50 percent….”

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“If one really wanted to opt out of a global banking system that far too many still regard as the way monetary transactions should be carried out, would one ask the U.N. for an alternative?

By Christina Sarich

The secret cabal’s control over international markets is becoming less of a mystery as increasing numbers of markets reveal themselves so obviously to be fixed.

Just in case you haven’t been keeping up with the ‘tin-foil’ hat conspiracies, increasingly proven to be true, the Federal Reserve Bank of New York, is the center of a secret global economy that has bailed out American International Group Inc., huge insurance companies like AIG, Goldman Sachs Group Inc., Merrill Lynch & Co., J.P. Morgan,Societe Generale and Deutsche Bank AG, among others.

The secret cabal’s control over international markets is becoming less of a mystery as increasing numbers of markets reveal themselves so obviously to be fixed. The cabal cheats on the 99% with Libor interest rates, foreign exchanges, and gold, silver, and platinum price fixing. Then there’s high-frequency trading (HFT), where Wall Street banks use supercomputers to monitor incoming stock market orders, analyze their likely impact on prices, and place orders ahead of those trades to capture a bit of the price impact, called ‘stealing’ if it were properly named.

HFT data helps to explain the frenzy in today’s markets: The most aggressive firms tend to earn the biggest profits, hence the incentive to trade as quickly and as often as possible. Furthermore, these traders make their money at the expense of everyone else, including less-aggressive high- frequency traders. It is simply the latest and greatest scam on stock holders looking for real value in a company, thinking they can compete with the big guys.

Just a few weeks ago, 132 nations decided they’ve had enough of the ‘secret’ money jig we’ve all been dancing to. One of the largest coalitions of developing nations in history has urged Secretary-General of the United Nations Ban Ki-moon, to provide, “as soon as possible…alternative options for banking services.” 132 countries, including China are done with the funny money scheme.

This comes on the heels of a mass cancellation of bank accounts in U.N. missions and those of foreign US diplomats. The G77 urges the secretary-general to review the

“U.N. Secretariat’s financial relations with the JP Morgan Chase Bank and consider alternatives to such financial institutions and to report thereon, along with the information requested.”

JP Morgan is the left arm of the cabal, along with other ‘big banks’ who were benefactors of billions in our tax money. They have shorted silver along with Citibank to increase their physical silver holdings by 500%. They are also the ‘big bank,’ along with Chase that failed to stopPonzi-schemer Bernard Madoff. Why do that? He was cut from the same clothe as their top executives.

JPMorgan Chase & Co CEO Jamie Dimon pleaded with and complained to the U.S. Justice Department a few years back but couldn’t convince the government to end its criminal probe of his bank because prosecutors couldn’t figure out just how crooked this banking system really was.

Banks like these helped crash our economies, and they are trying to do the same now, so that they can profit from it.

The problem for countries around the world is simple: Chase bank currently handles billions in accounts maintained by the United Nations and its agencies, in guess where – NEW YORK CITY.

The countries express a ‘deep concern’ over the decisions made by several other banking institutions, known puppets for the cabal, including JP Morgan Chase, in closing bank accounts for mostly developing countries. The resolution proposed, still subject to amendments cites a 1947 agreement between the US and UN, which:

 “. . .guarantees the rights, obligations and the fulfillment of responsibilities by member states towards the United Nations, under the United Nations Charter and international law.” ….”

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“Jeremy Stein, in one of his last speeches as a Federal Reserve governor, said policy makers are set for a smooth end to their bond-buying program that won’t whipsaw investors with shifting interest-rate expectations.

Investors “almost uniformly expect” that the Federal Open Market Committee will continue tapering purchases in “further measured steps” through the rest of the year, Stein said Tuesday in remarks prepared for delivery in New York. The Fed has slowed buying in $10 billion increments over the past four meetings to $45 billion a month.

“We are currently in a very good position with respect to the market’s expectations for our asset purchases,” Stein said. “With these expectations in place, the execution of the taper itself becomes much easier, as we no longer have to worry about a step-down at each meeting sending a potentially misleading message about our intentions with respect to the future path of the federal funds rate.”

Fed Chair Janet Yellen and her colleagues are starting the process of dialing back the most aggressive policy actions in the central bank’s history, aiming to do so without destabilizing financial markets. They have kept the main rate near zero since December 2008 and more than quadrupled the balance sheet to almost $4.3 trillion.

Stein said he agrees with Yellen’s comment at her March press conference that the FOMC’s views on policy will evolve as the economy does, and that uncertainty shouldn’t be eliminated.

“As policy normalizes, forward guidance will be less commitment-like and, hence, a less precise guide to our future actions than it has been in the recent past,” Stein said…..”

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“The Federal Reserve will likely bring its massive bond-buying program to an end in October, and only after that will it consider when to raise U.S. interest rates, a top Fed official said on Sunday.

“I personally expect us to end that program in October,” Dallas Federal Reserve Bank President Richard Fisher said in an interview on Fox News. “Then we have to see how the economy is doing, including these broader measures of unemployment and where we stand before we can talk about how we might move the short-term rate.”

U.S. unemployment registered 6.3 percent in April, a government report showed on Friday. But broader measures of the strength of the labor market, including the labor participation rate and hourly wages, indicated the jobs market is still far from strong…..”

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