Financial Markets and Economy
Friday's dismal economic data has people fearing a US recession (Business Insider)
There are a few words no one likes to hear in economics, but the most feared one might just be "recession."
Fed’s Mester Sees Gradual Rate Boosts Despite Weak Jobs Data (Bloomberg)
The Federal Reserve should raise interest rates gradually despite weak jobs data, Cleveland Fed President Loretta Mester said, a day after the U.S. payrolls report erased the argument for a move in June.
China could be about to plunge us all into a world of pain (Business Insider)
The trade of the year has come back to haunt markets.
This is the surprise amid stock-market confusion (Market Watch)
If someone asks what you think about the stock market — whether you are bullish or bearish — step away from the mouse or the phone before answering the question.
Why the Finance Industry Cannot Ignore Fintech Any Longer (Huffington Post)
The digital transformation has completely changed the business landscape in record time. We seldom stop to take stock of the situation, but the events of the past few years make it much easier to follow these Hard Trends to predict the future.
Goldman Flags $1 Trillion Reason for Fed to Go Slow on Rates (Bloomberg)
Lurking in the bond market is a $1 trillion reason for the Federal Reserve to go slow on interest-rate increases.
‘Stockbroker’s Bible’ Just Told Oil Industry To Accept Its Demise (Huffington Post)
The editorial board of the Financial Times isn’t exactly stacked with bleeding-hearted environmentalists. Just a month ago, the British paper defended ExxonMobil’s right to question climate change amid legal probes into whether the oil giant covered up evidence of global warming.
But in an editorial published Saturday, the FT urged the oil industry to “face a future of slow and steady decline.”
“America’s real religion is capitalism”: Bill Maher blasts the demonization of socialism (Salon)
“Real Time” host Bill Maher last night, during his popular “New Rules” segment, clowned laissez-faire bullshitters who demonize socialism while allowing capitalism to spread like wildfire into every nook of American life.
Have We Hit Peak Amazon? (Forbes)
But this dual success also exposes one of the company’s fault lines: namely, the imbalance in what you could call its “left hand/right hand business model.”
The government is cracking down on one of the most predatory industries in America (Business Insider)
The Consumer Financial Protection Bureau proposed new rules Thursday that represent the federal government's first attempt to regulate payday lending, an industry that provides quick and small loans to financially strapped individuals with interest rates that can reach 400% or higher.
Here’s Why Tesla Is A Giant Ponzi Scheme (Survey Money Investor)
You would think that investors would learn from their mistakes. For example, a lot of Wall Street analysts – two dozen of them in fact – have egg on their faces after missing the disaster at Valeant Pharmaceuticals, a stock that I warned about last October when it was trading at $170 per share. Today, with VRX stock down under $30 per share, the financial media and Wall Street has finally figured out what Sure Money readers knew before the rest of the crowd – that the pharmaceutical company was a house of cards built on a foundation of debt and a toxic business model.
Can Japan Come Back? (Gates Notes)
I have a soft spot for Japan. I have visited it more times than I can count. I’m fascinated by its unique mix of tradition and modernity. And Japan was the site of Microsoft’s first office outside the United States. Kay Nishi, who opened that office, is an amazing thinker, and one of the most under-appreciated leaders in the company’s history. With Kay’s help, there were a few years where Microsoft did more business in Japan than we did in the United States.
Steve Keen: Zombie-to-Be Economies and the Walking Dead of Debt Include China, South Korea, Canada, Finland (Naked Capitalism)
Steve Keen, one of the short list of economists to warn of the coming of the financial crisis, gives a very fast paced and informative talk. He explains the workings of his economic model, which contrary to prevailing macroeconomic models, includes the role of banking and credit. He then identifies the conditions that lead to zombification: a rapid expansion of credit in an economy that already has a high debt load. He shows how merely stabilizing the level of debt to GDP leads to a serious economic contraction.
Why Big Job Misses Are Likely to Continue (Financial Sense)
Breaking Down Nonfarm Payrolls: "The total nonfarm payroll accounts for approximately 80% of the workers who produce the entire gross domestic product of the United States. The nonfarm payroll statistic is reported monthly, on the first Friday of the month, and is used to assist government policy makers and economists determine the current state of the economy and predict future levels of economic activity."
Apple should buy Uber (Business Insider)
Calling Uber a Silicon Valley unicorn is passé. Uber is a $62.5 billion monster that's threatening to take down a nervous tech market.
We Have Reached Peak Employment Levels in this Business Cycle (Econ Matters)
The anchor for raising interest rates has been set by unreasonable Financial Market expectations instead of the Federal Reserve which should be using historical economic metrics. The Fed needs to go ahead and raise rates in June when they have a quarterly press conference. This may be as good as it gets in this business cycle, and we may be headed down from here, and be at the beginning of the next business cycle downturn. The Fed needs to build some cushion, have some dry powder for the next time they need to loosen monetary policy in an outright recessionary environment.
Your Portfolio Design: Assume the Fetal Position (Mauldin Economics)
Somehow in the last few months I found myself going from merely concerned about developed-world markets to outright advocating defensive positions. I thought some of the presentations at my Strategic Investment Conference would cheer me up. They did not.
Moody’s downgrades Halliburton and Baker Hughes (Fuel Fix)
Moody’s credit rating agency on Friday downgraded both Halliburton and Baker Hughes after their failed merger during the ongoing oil bust.
Electric car better investment than solar (MSN)
The extra expense of an electric vehicle roughly equates to the cost of installing roof-top solar electricity generation, making it a better investment for environmental outcomes, says John Hancock, the head of the Smart Grid Forum.
Politics
On Climate, Trump Promises To Let The World Burn (Think Progress)
President Obama’s climate change policies would be undone. Regulations on greenhouse gas emissions would be eliminated. The Keystone XL pipeline would be built. There would be no international agreement to prevent catastrophic climate change.
Clinton opens up double-digit lead over Trump nationwide (Reuters)
Democratic presidential contender Hillary Clinton has opened up a double-digit lead over Republican rival Donald Trump, regaining ground after the New York billionaire briefly tied her last month, according to a Reuters/Ipsos poll released on Friday.
Technology
Robots add real value when working with humans, not replacing them (Tech Crunch)
In the popular media, we talk a lot about robots stealing jobs. But when we stop speculating and actually look at the real world of work, the impact of advanced robotics is far more nuanced and complicated. Issues of jobs and income inequality fade away, for example — there aren’t remotely enough robots to affect more than a handful of us in the practical sense. Yet robots usually spell massive changes in the way that skilled work gets done: The work required to fly an F-16 in a combat zone is radically different from the work required to fly a Reaper, a semi-autonomous unmanned aerial vehicle, in that same zone.
Google is working on a kill switch to prevent an AI uprising (Engadget)
Humans don't like the idea of not being at the top of the food chain; having something we've created taking power over us isn't exactly ideal. It's why folks like Tesla mastermind Elon Musk and noted astrophysicist Stephen Hawking are so determined to warn us of the terrifying implications that could culminate in a Skynet situation where the robots and algorithms stop listening to us. Google is keen to keep this sort of thing from happening, as well, and has published a paper (PDF) detailing the work its Deep Mind team is doing to ensure there's a kill switch in place to prevent a robocalypse situation.
Even cowboy jobs may not be safe from robots (Bloomberg)
An Australian professor is developing a robot to monitor the health of grazing livestock, a development that could bring big changes to a profession that’s relied largely on a low-tech approach for decades but is facing a labor shortage.
Health and Life Sciences
Study reveals Cheese is as Addictive as Cocaine and Heroin (Detechter)
Scientists have found that Cheese is as addictive as Drugs. According to the study, conducted at the University of Michigan, Cheese is addictive because of a protein called casein, found in milk products.
Researchers identified addictive foods from about 500 people who completed the Yale Food Addiction Scale, designed to measure if someone has a food addiction.
‘Liquid’ Cancer Test Offers Hope for Alternative to Painful Biopsies (NY Times)
A blood test to detect cancer mutations produced results that generally agree with those of an invasive tumor biopsy, researchers reported, heralding a time when diagnosing cancer and monitoring its progression may become less painful and risky.
Life on the Home Planet
Rain slows, but flooding still threat in southeast Texas (Phys)
The heavy rain that's been hovering over parts of southeast and central Texas and caused deadly flooding began to lift Saturday, but officials said the flooding emergency near the Gulf Coast was worsening and Army officials kept up their investigation of a training exercise that went horribly wrong at Fort Hood.
