Dollar Devaluation as an Elixir; Guv Health Care to Hijack Private Insurance; Oil Extraction Costs Rising

May 3, 2012


“When you start divorcing the creator of risk from the ultimate holder of the risk, it becomes an issue.” Louis Ranieri, inventor of Mortgage Backed Securities

“The thing that I fear is confiscation. Confiscation of my assets, confiscation of my clients’ assets. I fear that this thing could get out of [control]. I think we’re a year away from the French fully nationalizing their banking system…” ~ Eclectica’s Hugh Hendry

“There hasn’t been a case in history where they haven’t eventually printed money and devalued their currency” ~ Ray Dalio

“If I’m president, I will label China a currency manipulator and apply tariffs” ~ Mitt Romney, tradewar

Central Banking:

Since 1973, dollar’s value vs $USDJPY is down 5-fold, yet the US trade deficit with Japan has increased 10-fold ~ Financial Sense -further debunking debauching the currency as a path to prosperity

Greenspan says the effect of stimulus on equities underestimated~ #operationnewbubble fully underway


At Milken, Feelings of Malaise ~ DealBook

  • One new rule introduced as part of Dodd-Frank Act will force a PE firm to spend $50 million a year on new auditors and compliance officers 
  • “Panelists said that the new regulatory regime was making it harder for banks to lend, and leading to the rise of a shadow banking sector” 

U.S spends $300 billion a year on tax preparation, says Tom Coburn ~ bloomberg

Growth of smartphones: Samsung 235%, Other 219%, Huawei 180%, ZTE 155%, Apple 88%, LG 35%, Motorola 24%, HTC -29%, RIM -26%, ~ @asymco

107 people charged with $452 million in Medicare fraud ~ bloomberg – great, multiply that by 100, annually, and you’ve solved the problem.

Health care plan incentives companies to drop your health care coverage and dump you into the government system ~ Fox News

  • “Even after paying a penalty of $2,000 per employee, the companies stand to save $28.6 billion in 2014 alone by shifting employees to health insurance exchanges governed by strict federal standards.”


Kuwait: “many families take to subsidized foodstuff simply because it is there, and not because they need it”~ albawaba

Australian Iron Ore Billionaire to build Titanic replica (needs registration) ~ FT - excess is frequently one sign of a top

German tempers boil over back-door euro rescues ~ UK Telegraph

  • France’s share of eurozone exports has dropped from 17pc to 13pc since 2000

Total European Banking assets stand at $65 Trillion versus $12 trillion in US ~ Milken Institute ~ historysquared

Ugly Chart of Eurozone PMI ~ FT Alphaville

Marginal oil production costs are heading towards $100/barrel ~ FT Alphaville

Performance of the Thai Baht during the 1997 Asian Flu ~ currency trader magazine

Lessons from the 1997-1998 Asian Financial Crises ~ HistorySquared

FX and Gold Reserves in Europe, ~ currency trader magazine  risk increases when ST debt to reserves greater than one


International Comparison Retail Price of Gas, artificially cheap, often due to subsidies ~ twitter


Goldman Sachs says bank regulations to hurt corporate bond market and small businesses, cost 300,000 jobs, reduce GDP bt 0.4% says $GS ~ FT alphaville  -they’re biased, but points are notable

Resource companies by governments are “giant ATM machines” for governments and “patronage job creators” ~ Bloomberg

China’s Cash-Poor Developers Fuel Commercial Property Deals ~ Bloomberg  the vultures circle

Hong Kong Sells Land at $5,113.69 per square foot, below estimates ~ Bloomberg

Ugly Chart of Europe’s PMI ~ FT Alphaville

Living in China on $475 a month: own bedroom $95/mo; Internet $3/mo; Gym $11/mo; $12/mo all utilities ~ MiamiHerald 

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