Find The Lowest Price HERE

By Tyler Durden

Submitted by Brendan Brown via The Mises Institute,

In our time, the greatest source of money chaos is now the global 2%-inflation standard. Deflation-phobic central bankers, led by the FOMC at the Fed, are defying the natural rhythm of prices in a capitalist economy. Under sound money, there would be periods of both falling and rising prices.

Since central bankers choose to steadfastly ignore this reality, the result has been the emergence of three serious global asset price inflation diseases in just three decades. Their undermining of economic prosperity has shown up as a situation marked by low investment, malinvestment, and correspondingly weak real income and productivity growth. This has been coupled with episodes of huge profits for “Wall Street,” and the resulting increased inequality has made fertile ground for populism both on the left and the right. Meanwhile, the intensified regulatory state, which populism has helped produce, has compounded the economic malaise.

The Role of “Official” Productivity and Inflation

A principal tenet relied upon by the architects and advocates of the global 2% inflation standard has been that productivity growth is greater than is reported, while inflation is less than reported — according to the official statistics. And so, 2% inflation on the official measure might be only 0-0.5% in reality.

Meanwhile, the central bankers claim, statisticians are not correctly measuring the improvements in our daily lives that new technology brings. Price measurements, we’re told, don’t tell us enough about how much value is added by innovative products, such as time saved, or safety gained. The effort to include these improvements within the price measures is known as hedonic price accounting. Hedonics is designed to measure the fact that automobiles technology, for example, makes cars safer and more comfortable than you think. Yes, cars are much more expensive today — the argument goes — but we have to factor increases in quality and efficiency into modern prices. If you take this into account, the central bankers claim, then inflation is actually lower than you think, because the products we buy are all of higher quality now, and we’re getting more for our money.

Thus, if a piece of medical software does more today than 20 years ago, then inflation in the price of that good is actually less than the statistics suggest.

This Is Nothing New

The same point concerning price statistics could have been raised in the gold standard years of say 1870–1914, or in the 1920s, or the 1950s and 60s.

During those periods, incidentally, there was no hedonic price accounting then at all — so stable prices as measured by the available statistics would have been equivalent to say 1–2% “deflation” under today’s measurement techniques.

The transition from canals to railroad transportation — or from ice cupboards and salting to refrigeration — evidently had benefits which transcended crude price gathering by statistical offices.

Technological Innovation Has Both Costs and Benefits

Broader economic reflection suggests that the statisticians in the pre-hedonic price adjustment age — which began in the 1980s and was …read more

Source: How Central Banks Created "Trumpism"

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

After last Friday’s disastrous jobs report and concurrent prior revisions, few were expecting any remarkable developments from “Yellen’s favorite labor market indicator”, the BLS’ JOLTS, or Jobs Openings and Labor Turnover Survey, and yet there were two surprises.

First, when it comes to actual job openings, the number rose from a downward revised 5.675MM to 5.788MM, which meant the job opening rate remained flat at 3.9%, even if the actual number of job opening just matched the all time high of last July.

The biggest number of job openings were in the leisure and hospitality services industry, followed by accommodation and food services; retail trade; and education and health services, all the lowest or minimum wage paying jobs.

And while job openings continued rise, actual hiring slowed down substantially: at 5.092MM new hires in the month of April, this was the lowest since September of 2015. As the chart below, which correlates the 12 month change in NFPs to hires, the labor market may indeed be rolling over.

Netting out separations from hires, showed that net turnover of jobs – traditionally the equivalent series to the BLS’ monthly establishment payrolls data – printed at only 104K, this was the lowest addition since June 2014. We expect next month’s data to be even worse as it declines to match the 38K reported in May job gains.

Finally, all of this is summarized in the latest Beveridge curve below, which shows that something remains structurally broken with the work force as at this level of unemployment, the jobs opening rate should be at least one whole percentage point lower, suggesting wage pressures are building up. It is this slack that is resulting in so much confusion at the Fed, not to mention lack of wage growth.

This is how the BLS explains the above chart:

• The graph plots the job openings rate against the unemployment rate. This graphical representation is known as
  the Beveridge Curve, named after the British economist William Henry Beveridge (1879-1963). The economy’s
  position on the downward sloping Beveridge Curve reflects the state of the business cycle.
• During an expansion, the unemployment rate is low and the job openings rate is high. Conversely, during a contraction, the unemployment rate is high and the job openings rate is low. The position of the curve is determined by the efficiency of the labor market. For example, a greater mismatch between available jobs and the unemployed in terms of skills or location would cause the curve to shift outward (up and toward the right).
• From the start of the most recent recession in December 2007 through the end of 2009, the series trended lower and further to the right as the job openings rate declined and the unemployment rate rose. From 2010 to the present, the series has been trending up and to the left as the job openings rate increased and the unemployment rate decreased.
• In April 2016, the unemployment rate was 5.0 percent and the job openings …read more

  Source: The Beveridge Confusion: Hiring Tumbles Despite Job Openings Rising To Record High

      

  100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps
  Looking for something special ? Find The Lowest Price HERE

  
  

Find The Lowest Price HERE

By Tyler Durden

Today is a historic day for the corporate bond market: with the launch of the ECB’s CSPP, Mario Draghi is now directly buying European investment grade non-financial bonds. This means that no longer will European corporate bonds trade based on their fundamentals, but purely on expectations of frontrunning future ECB purchases. And to make the frontrunners’ lives easier, according to Bloomberg among the ECB’s purchases today were €3 million Engie bonds, Telecom Italia notes due in 2023 and 10-year Telefonica securities; the ECB also bought securities issued by Anheuser-Busch InBev NV, the world’s largest brewer; Telefonica SA, Spain’s former telecommunications monopoly; Siemens AG, Europe’s biggest engineering company; Assicurazioni Generali SpA, Italy’s top insurer; French automaker Renault SA and utilities Engie SA and RWE AG.

We expect their yields to tumble to even lower record lows in the coming days. Engie’s 300 million euros of notes maturing in 2111 rose as much 2.8 cents on the euro to the highest since April at 170 cents after it was reported that the French central bank bought the company’s bonds on behalf of the ECB.

RWE’s 600 million euros of notes due February 2033 rose 0.6 cents on the euro to 135.4 cents, the highest in four weeks, while Telefonica’s 1.35 billion euros of 10-year bonds rose to the highest on record, Bloomberg data show.

The ECB is targeting bonds with maturities of five years to eight years from chemical and real estate companies; six years to eight years for utilities; and two years to three years for auto firms.The ECB can choose from as many as 1,049 securities totaling 620 billion euros, according to data compiled by Bloomberg. CreditSights puts the size of the universe at about 628 billion euros, while Morgan Stanley estimates it is about 675 billion euros. The ECB will publish a list of its corporate bond holdings on July 18 and update it every Monday, according to the central bank.

As Regina Borromeo of Brandywine Global Investment Management said, “Draghi knows the ECB needed to come out with a big punch on the first day of its corporate purchase program to maintain credibility and confidence in his willingness to act.” And so he has: average yields for euro notes were down to 0.98% on Tuesday, the lowest in more than a year, according to Bank of America Merrill Lynch index data. The ECB’s intervention in the government bond market over the past year has pushed yields down to records, as pricing no longer reflects any fundamentals.

While the ECB having preannounced it would purchase these and other securities some three months ago, investors are watching for an indication of whether they were right to pile into investment-grade corporate bonds on the promise of ECB President Mario Draghi’s purchases.

Much is riding on the line for Draghi as a result of this unprecedented attempt to spur European inflation by way of encouraging stock buybacks, which is what the “logic”“There is a fair amount riding on this in terms of the ECB’s credibility,” …read more

Source: These Are The Bonds The ECB Is Now Buying

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

Two Alaska Air planes have completed commercial flights powered by a mixture of traditional jet fuel and a biofuel made from corn. …read more

Source: South Dakota corn may be fueling your next flight

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Find The Lowest Price HERE

By Tyler Durden

In an unexpected development, in his latest note the best market inflection point indicator alive, Dennis Gartman, has decided to pick on none other than billionaire Bill Ackman. This is the result:

We wish to talk once again about the incredible collapse of Valeant’s shares and the damage being wrought upon the reputation of those hedge fund managers still caught long of this company’s shares, with the leading example remaining the demise of the once sterling reputation of Mr. Bill Ackman of Pershing Square Capital. Here we have one of the true giants of the hedge fund industry; a gentleman once worth billions who ran billions more; a leader in the performance race for many years and now rather obviously a gentleman, who like Icarus of Greek mythology fame, flew too close to the sun and is now falling into oblivion.

Pershing Square’s assets are down 18.6% for the year as of the end of May we are told. We see no sense in being vindictive for there is nothing to be gained in being so; rather we wish simply to point out that the “Rules of Trade” are meant to be adhered to and that the “first among equal” of our rules of trading is the first: that one is never, ever, under any circumstance to average down into a trade. As our old friend, Paul Tudor Jones, says in this regard, “Losers average losers.”

When one averages down into a long position… or averages “up” into a short position… only one thing can be happening to the equity in one’s account: it must, by definition, be falling. If you buy a company’s stock at $25/share and it goes to $20/share, you are worth less than you were before. It cannot be otherwise. It is simple arithmetic. On the other hand, if you buy a company’s shares at $25/share and they go to $30/share your equity can only be larger. Why, we ask, would you wish for the former?

When a stock begins to fall there is no actual way of telling how far down it may fall before its weakness is stemmed. Enron’s shares fell relentlessly… inexorably… from $85/share to zero, and it was considered to be under-valued at every single penny lower as it fell. Buyers bought all the way down into bankruptcy. We watched as USAirways’ stock fell from $125/share all the way to zero, with some of the great minds in the business having owned it… and having bought it… all the way down into oblivion. We watched as sugar prices in the early 70’s fell from $1.25/lb. to $0.03/lb., with buyers all the way down, and over the past three decades we’ve watched as the coupon on the long bond here in the US has gone from 14.25% to where it is today in single digits.

The purpose for this exercise is to learn the lesson that Mr. Ackman is learning the very hardest of ways: that the market is wiser and larger and …read more

Source: Dennis Gartman Mocks Bill Ackman’s "Demise"; Tries To Understand Bitcoin, Fails

    

100% Pure Garcinia Cambogia Extract – Appetite Suppressant – Carb Blocker Capsules – 2100 MG – 90 Caps

Looking for something special ? Find The Lowest Price HERE