Sunday, May 15, 2011

Submitted by Tyler Durden on 05/15/2011 21:17 -0400

A French reader of Zero Hedge steps up and makes the following bold prediction: a "Tiger Woods effect" is now imminent, as many other rape accusations against Domonique Strauss-Kahn emerge, since yesterday's rape episode is most certainly not the first time this has occurred (granted, DSK is innocent until proven guilty). "Until now, hes has been bale to fight back allegations by "fixing" the situation through influence and keeping the French press shut up, or by pressuring the women into not getting into a public battle with him." Now this status quo is over, and it is very likely that very soon many more will step up from under the cloak of anonymity and tell their story.

Complacency That Makes You Go Hmmm

Submitted by Tyler Durden on 05/15/2011 20:47 -0400

Time for another dose of original observations and compiled content from the pen of Grant Williams and his latest "Things that make you go hmmmm" which this time focuses, appropriately, on the topic of complacency: "It seems to me that if there were a futures contract in complacency, it would certainly not be in need of a CME margin hike due to a completely lopsided supply/demand picture. Yes I’m sure there would be all kinds of whack-jobs talking about a conspiracy to sell complacency short and thus flood the world with unbacked self-satisfaction and unawareness, but the simple truth is, complacency occurs naturally for the most part and is in abundance roughly 95% of the time. Lately, however, a curious phenomenon has taken place. Back in the dying days of the 20th century, Doctor Alan Greenspan discovered a way to manufacture a super-strain of artificial complacency by adding confidence and using the power of words and the setting of interest rates. Greenspan soldiered on and, when Long Term Capital Management hit the skids in 1998, he set about his grand experiment - introducing manufactured complacency into the financial marketplace. Prior to 1998, the business world had largely existed on a traditional cycle of boom and bust as contraction followed expansion and failing businesses were allowed to meet their inevitable demise. They were heady days indeed. People were wary of the potential pitfalls of bad decision-making and, while complacency was most certainly evident, its supply/demand situation spent many long periods in perfect equilibrium. After Dr. Greenspan’s introduction of artificial complacency, however, things began to change..."

"Act As If" - Greece vs America Edition

Submitted by Tyler Durden on 05/15/2011 20:06 -0400

The most memorable scene from the movie Boiler Room is when the character of Ben Afleck tells the room full of wannabe brokers to "Act As If" (and in the tangent regarding male genitalia, the head of the IMF would have been wise to take the advice instead of opening his fly and disproving it). Who would have thought that a few short years later, it would be none other than insolvent countries taking this advice: specifically, America acting as if it wasn't insolvent, and Greece acting as if it was beyond saving. The irony, as William Buckler observes in his latest edition of the Privateer, is that while US debt continues to trade (if no longer be accepted) as the "Rock of Gibraltar" and Greek paper is trading with a certainty of bankruptcy, it is Greece that has taken proactive steps in taxing and spending policy, while the US has merely retrenched its profligate ways, and while much political theater takes place, nothing ever really changes. For some of the more perverse consequences of this bizarro world inversion, read below.

Shadow Stat Misery Index Highest on Record

What does a trillion dollars look like?

Social Security Trust Fund Bonds Will be the "21st Century Version of Confederate Banknotes"

South Carolina Moves to Make its Own Gold & Silver Money

Rising Food And Gas Costs Push Up Consumer Prices

The Great Government Fire Sale Is On

Global Stock Markets Hit By Second Commodities Sell-off