by Keith Weiner

 

At the Cato Monetary Conference this week, Scott Sumner said he had a “modest” proposal, that there should be a highly liquid futures market in Nominal Gross Domestic Product (NGDP).  This caught my attention, as the futures market is a topic near and dear to my heart (I write about it every week).

Sumner is known for his view that the Fed should target NGDP as the basis for monetary policy. So a futures market that predicts it would be convenient. Let’s look at his idea more closely.

What, precisely, is to be traded? If I buy an NGDP future, what is delivered at contract maturity? It’s clear what I get when I buy a wheat future or crude oil future. With Nominal GDP futures, there’s nothing to receive because NGDP is not a commodity or even a security.

A futures contract is a derivative, but an NGDP future would not be derived from anything.

So how is an NGDP contract supposed to settle? The only thing I can think of (Sumner doesn’t say) is that the NGDP contract will pay based on the published NGDP number. For example, if NGDP comes in at $19T, then the contract might pay out $19,000 (depending on how many NGDP units are represented by the contract).

GDP numbers are revised a few times after they are published. Is the NGDP contract to pay when the initial number comes out, even though it might be wrong? Or will NGDP be the only contract where both parties’ capital must be locked up for months until the Bureau of Economic Analysis publishes the final number?

Moving on to the next problem, let’s look at a real futures contract like wheat. Suppose the bid price on a March wheat future is $7.00 and the ask price on spot wheat is $6.50. There’s 50 cents of profit to anyone who can buy wheat in the spot market, sell it in the futures market, and store it for the duration. This is called carrying, which is an act of arbitrage.

Arbitrage anchors the price of wheat futures to the price of wheat in the spot market. Both prices can move up and down in response to changes in supply (demand being pretty stable in wheat) or speculation that supply will change.

By contrast, the NGDP market is for speculators only. It has no connection to a real price, and no arbitrageurs. I am all for making gambling legal, if people want to bet on NGDP, the weather, or the horse race. But that’s not Sumner’s point. He believes that this market will predict NGDP accurately enough to manage the economy without causing recessions and depressions.

Sumner declares this market won’t merely be liquid. It will be highly liquid. Let’s consider that.

Each market has a different degree of liquidity. The liquidity comes from the character of the thing being traded, not from a government proclamation. For example, copper is more liquid than lumber. Silver is more liquid than copper and gold is more liquid than silver.

A liquid market has a continuous bid and ask. That does not mean someone is always buying or selling. On the contrary, it means someone stands ready to buy or sell at any time. Who and why?

In my wheat example, I mention the carry arbitrage. Suppose the cost to carry—interest and storage—is 30 cents. Each trader has to decide his minimum profit threshold. Suppose Joe is willing to do it for 20 cents. He needs to get at least 50 cents on the deal. He can sell a March for $7.00, which is why he bids $6.50 on spot. Joe will not pay one penny more, unless the price of March wheat goes up.

Joe and his competitors are why there’s always a bid (and ask) in wheat.

Obviously, there is no carry arbitrage with NGDP futures. There won’t be much liquidity either.

An NGDP market may convenient for monetary planners, but without a reason to exist it won’t work the way Sumner hopes.

 

This article is from Keith Weiner’s weekly column, called The Gold Standard, at the Swiss National Bank and Swiss Franc Blog SNBCHF.com.

First published here: http://www.zerohedge.com/news/2015-11-30/will-gdp-futures-market-be-liquid

Bet you didn’t know Wilson Phillips sang on “FourFiveSeconds.”

1. Six months passed between when Adele wrote the verses of "Hello" and when she finished the chorus.

2. Both Rihanna and Nicki Minaj passed on Major Lazer's "Lean On" before Diplo decided to move forward with Danish pop singer MØ.

3. The distinctive dolphin-sounding hook in Jack Ü's Justin Bieber collab "Where Are Ü Now" is actually a clip of the pop star's voice that's been distorted.

4. Britney Spears and Iggy Azalea's single "Pretty Girls" was originally intended for Little Mix's third album, but the girl group passed on it because they "knew [they] could do better."

5. Country singer Cam was inspired to write her breakthrough single "Burning House" after she had a nightmare about dying in a fire with her ex-boyfriend.

RCA Records

XL Recordings

---

View Entire List ›

First published here: http://www.buzzfeed.com/kelleydunlap/surprising-facts-about-2015-hit-songs?utm_term=4ldqpia

 

By EconMatters

I have to admit that I am a news junkie. So my TV was glued to CNN on the day of the Paris terrorist attack. During its coverage, one of the CNN commentators mentioned that ISIS makes about $2 million a day in oil revenue. That piqued my curiosity and decided to find out more about ISIS oil operation.

Oil as a Strategic Weapon

According to FT, ISIS oil strategy has been long in the making since the group emerged in Syria in 2013. The group saw oil as a funding source for their vision of an Islamic state, and identified it as fundamental to finance their ambition to create a caliphate. ISIS controls most of Syria's oil fields where it created a foothold in 2013. Crude is the militant group's biggest single source of revenue.

ISIS has derived its financial strength from being the monopoly oil producer in a huge captive market in Syria and Iraq. Despite a US-led international coalition to fight ISIS, FT describes a "minutely managed" sprawling ISIS operation akin to a national oil company in just two years with an estimated crude production of 34,000-40,000 barrels per day (bpd).

 

$1.5 million a Day to Fund The Terrorist Group 

The group sells most of its crude directly to independent traders at the wellhead for $20-$45 a barrel earning the group an average of $1.5 million a day. Without being able to export, ISIS brought hundreds of trucks and started to extract the oil and transport it. According to an FT interview of a local sheikh, an average of 150 trucks is filled daily with about $10,000 worth of oil per truck. Most traders can expect to make a profit of at least $10 per barrel.

 

Son of Turkey's President Is In on ISIS Oil?

The arbitrage had the potential to go a lot more than $10 a barrel when oil prices were high. Russia has accused Turkey of buying ISIS oil (allegedly the son of Turkey's President is involved, and also allegedly the U.S. is aware of it), reselling it to Japan and Israel for huge profits. Smugglers have been using boats, pumps, carrying on foot, by donkey or horse. Some see the oil production from ISIS as a contributing factor to the global oil glut pushing down oil prices.

Read: Using the Wave Principle to Trade

ISIS Adapts to Low Oil Prices

However, the biggest threat to ISIS oil production has been the depletion of Syria's aging oilfields despite the group's efforts to recruit skilled oil workers. ISIS does not have the technology of major foreign oil companies to counter the production decline.

ISIS has tried adapting to the new lower oil price environment by turning to oil midstream and downstream. FT and Aljazeera both reported that ISIS has recently expanded into refining and petrol stations. In ISIS-controlled territory, there's no shortage of demand.

 

Russia & China Eyeing Middle East While Obama 'Pivots' to Asia

It is widely acknowledged that one of the reasons the international coalition against ISIS has not been effective is the reluctance of the coalition to target ISIS oil infrastructure (trucks, oilfields, pipelines) where there's a large civilian presence, and for the potential environmental impact. Russia jumped in to aggressively target specifically ISIS oil operation and infrastructure aiming to cut off its funding source after ISIS took out a Russian plane. In essence, Russia is trying to push the U.S. aside and take a leadership role in dealing with the ISIS and Middle East chaos.

Russia's timing is impeccable just as the U.S. is 'pivoting' to Asia, while China is only too eager to help Russia with an eye on the Middle East energy assets for its future energy security. The alliance of China and Russia may have been weakened on a now fragile economic ground due to the slowing economy in China and low oil prices negatively impacting Russia.

However, the U.S. could be in serious trouble if the world starts trading oil in Reminibi instead of the U.S. dollar now that IMF has approved Chinese yuan as a main world currency.

 

Coalition In-fighting

Judging from the allegation that Turkey is buying ISIS oil, and that Turkey shot down a Russian Jet within a narrow 17-second window (some say the actual window is only 5 seconds), there is some serious in-fighting within the coalition against ISIS (perhaps that's why Obama is desperate enough to drag Taiwan into the 'Coalition'). One thing seems to always ring true in international politics: When it is about money or self-interests, countries seem more than willing to go that extra mile despite any potential dire consequences.

This could mean ISIS will keep its funding source with its oil making its way to all the intended and 'unintended' recipients like Japan, a significant U.S. ally. ISIS has so far demonstrated its ample capabilities in adapting and organizing its operation, this suggest there's a long way to go in the fight against ISIS terrorists.

First published here: http://www.zerohedge.com/news/2015-11-30/isis-oil-strategic-weapon

Filed under: Market News, Federal Reserve, Consumer Goods, Healthcare Industry, Interest Rates

By Caroline Valetkevitch

NEW YORK - U.S. stocks slipped Monday, led by declines in health and consumer shares, as investors braced for policy news from central banks.

The three major stock indexes posted a second straight month of gains, however, helped by financial shares, which were up 1.7 percent, while utilities were down 2.8 percent for the month.

Retail stocks were down on Cyber Monday, the biggest online shopping day of the year. The S&P retail index was down 1 percent, while Target shares fell 1.3 percent to $72.50 after its website faced an outage due to heavy traffic.

Shares of brick-and-mortar stores were down following Black Friday, including Walmart Stores (WMT), down 1.8 percent at $58.84, and Macy's (M), down 2.3 percent at $39.08.

Sales on Cyber Monday, the busiest day of the year for internet shopping, were up 14 percent from a year earlier, according to data.

Federal Reserve Chair Janet Yellen is due to address Congress on Thursday and give a speech on the economic outlook the day before.

While the U.S. central bank could raise interest rates in December for the first time since 2006, the European Central Bank is expected to unveil fresh monetary easing measures Thursday.

Friday's non-farm payrolls report could give further clues on the direction of policy ahead of the Fed's Dec. 16-17 policy meeting.

"There's apprehension on the part of investors to make any big commitments ahead of the data and potential policy moves coming up," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

The The Dow Jones industrial average (^DJI) fell 78.57 points, or 0.4 percent, to 17,719.92, the Standard & Poor's 500 index (^GSPC) lost 9.65 points, or 0.5 percent, to 2,080.46 and the Nasdaq composite (^IXIC) dropped 18.86 points, or 0.4 percent, to 5,108.67.

For the month, the Dow was up 0.3 percent, S&P 500 rose 0.1 percent and the Nasdaq gained 1.1 percent.

Market Movers

The S&P health sector's 1.3 percent fall led the decliners, with biotech stocks down the most. Consumer staples were down 1 percent, while discretionaries fell 0.8 percent.

Other U.S. data expected during the week include November manufacturing and auto sales reports.

Among other retailers, Staples (SPLS) fell 1.9 percent to $12.07. The New York Post reported U.S. antitrust regulators were preparing to block Staples' acquisition of smaller rival Office Depot. Office Depot (ODP) was down 2.4 percent at $6.59.

Declining issues outnumbered advancing ones on the NYSE by 1,752 to 1,325, for a 1.32-to-1 ratio; on the Nasdaq, 1,516 issues fell and 1,327 advanced, for a 1.14-to-1 ratio favoring decliners.

The S&P 500 posted 15 new 52-week highs and 7 lows; the Nasdaq recorded 127 new highs and 55 lows.

About 7.6 billion shares changed hands on U.S. exchanges, above the 6.8 billion daily average for the past 20 trading days, according to Thomson Reuters (TRI) data.

-Tanya Agrawal contributed reporting.

What to watch Tuesday:

• At 10 a.m. Eastern time, the Institute for Supply Management releases its manufacturing index for November and the Commerce Department releases construction spending for October.
• Automakers release vehicle sales data for November.

 

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First published here: http://www.dailyfinance.com/2015/11/30/market-wrap-wall-street-falls-health-consumer-shares/

We've reported again and again and again and again and again that everyone knew that Iraq didn’t have weapons of mass destruction (WMDs).

Indeed, the architects of the Iraq war admitted that it was illegal ... and really fought for oil (and Israel).

Today, a new smoking gun has  been disclosed.  The Guardian notes:

Tony Blair went to war in Iraq despite a report by South African experts with unique knowledge of the country that showed it did not possess weapons of mass destruction, according to a book published on Sunday.

 

God, Spies and Lies, by South African journalist John Matisonn, describes how then president Thabo Mbeki tried in vain to convince both Blair and President George W Bush that toppling Saddam Hussein in 2003 would be a terrible mistake.

 

Mbeki’s predecessor, Nelson Mandela, also tried to convince the American leader, but was left fuming that “President Bush doesn’t know how to think”.

 

***

 

The claim was this week supported by Mbeki’s office, which confirmed that he pleaded with both leaders to heed the WMD experts and even offered to become their intermediary with Saddam in a bid to maintain peace.

 

South Africa had a special insight into Iraq’s potential for WMD because the apartheid government’s own biological, chemical and nuclear weapons programme in the 1980s led the countries to collaborate. The programme was abandoned after the end of white minority rule in 1994 but the expert team, known as Project Coast, was put back together by Mbeki to investigate the US and UK assertion that Saddam had WMD – the central premise for mounting an invasion.

 

Mbeki, who enjoyed positive relations with both Blair and Saddam, asked for the team to be granted access.

“Saddam agreed, and gave the South African team the freedom to roam unfettered throughout Iraq,” writes Matisonn, who says he drew on sources in Whitehall and the South African cabinet. “They had access to UN intelligence on possible WMD sites. The US, UK and UN were kept informed of the mission and its progress.”

 

The experts put their prior knowledge of the facilities to good use, Matisonn writes. “They already knew the terrain, because they had travelled there as welcome guests of Saddam when both countries were building WMD.”

 

On their return, they reported that there were no WMDs in Iraq. “They knew where the sites in Iraq had been, and what they needed to look like. But there were now none in Iraq.”

 

In January 2003, Mbeki, who succeeded Mandela as president, sent a team to Washington to explain the findings, but with little success. Mbeki himself then met Blair for three hours at Chequers on 1 February, the book relates.

 

He warned that the wholesale removal of Saddam’s Ba’ath party could lead to a national resistance to the occupying coalition forces. But with huge military deployments already under way, Blair’s mind was clearly made up. When Frank Chikane, director-general in the president’s office, realised that the South Africans would be ignored, it was “one of the greatest shocks of my life”, he later wrote in a memoir.

 

Matisonn adds: “Mandela, now retired, had tried as well. On Iraq, if not other issues, Mandela and Mbeki were on the same page. Mandela phoned the White House and asked for Bush. Bush fobbed him off to [Condoleezza] Rice. Undeterred, Mandela called former President Bush Sr, and Bush Sr called his son the president to advise him to take Mandela’s call. Mandela had no impact. He was so incensed he gave an uncomfortable comment to the cameras: ‘President Bush doesn’t know how to think,’ he said with visible anger.”

 

***

 

Mbeki’s spokesman, Mukoni Ratshitanga, confirmed that Mbeki met Blair at Chequers to advise against the war and the UK’s involvement in it. Blair disagreed, Ratshitanga said, insisting that he would side with Bush.

 

“President Mbeki informed the prime minister that the South African government was about to send its own experts to assist and encourage the Iraqis to extend full cooperation to the UN weapons inspector, Dr Hans Blix,” Ratshitanga said. “He urged the prime minister to await the report of the SA experts before making any final commitment about going to war against Iraq.

 

***

 

Mbeki also had a phone conversation with Bush in 2003 and tried to discourage him from going to war, the spokesman said. “President Bush said he would rather not go to war but needed a clear and convincing signal that the Iraqis did not have WMDs to enable him to avoid the invasion of Iraq.

 

“President Mbeki informed him about the report of the SA experts which by then had already been sent to the UN secretary general, Dr Hans Blix and the UN security council. He informed President Bush that the report of the SA experts said Iraq had no WMDs. President Bush said he did not know about the report but would obtain a copy from the US ambassador at the UN, New York.”

 

It is not known whether Bush did obtain a copy of the report.

Mbeki later contacted Blair to ask him to find out from the US president what would constitute a “convincing signal” from Saddam, promising that he would contact Saddam to persuade him to send such a signal, according to Ratshitanga. “President

 

Mbeki understood from his sources and was convinced that Prime Minister Blair received his message as reported above, but did not convey it to President Bush.”

 

Blair’s office did not deny the meeting with Mbeki or the specifics of what was said.

But the U.S. and UK wanted war ... not peace.  They even rejected an offer from Saddam Hussein to leave Iraq and allow in weapons inspectors.

Obama and Clinton did the same thing in Libya and Syria.  They also supported Islamic terrorists in both Libya and Syria.

Related ... Research Paper: ISIS-Turkey List

First published here: http://www.zerohedge.com/news/2015-11-30/new-smoking-gun-us-and-uk-knew-saddam-did-not-possess-wmds

PASSING through the Suez Canal became easier earlier this year, thanks to an expansion completed in August. Now it is about to become a little bit more complicated. Transit fees for the canal are denominated in Special Drawing Rights, a basket of currencies used by the International Monetary Fund (IMF) as its unit of account. Today the IMF decided to include the yuan in the basket from next year, joining the dollar, the euro, the pound and the yen.

If lots of things were priced in SDRs, the IMF’s decision would have forced companies around the world to buy yuan-denominated assets as soon as possible, to hedge their exposure. That would have prompted China’s currency to strengthen dramatically. But few goods or services are priced in SDRs. Instead, admission to the currency club is significant mainly for its symbolism: the IMF is lending its imprimatur to the yuan as a reserve currency—a safe, liquid asset...Continue reading

First published here: http://www.economist.com/news/business-and-finance/21679341-its-new-status-might-make-weaker-yuan-chinese-renminbi-joins-imfs?fsrc=rss

Gold Demand in China Heading For Record and Reserves Increase 14 Tonnes In October

While gold prices continue to languish in the doldrums and are on course for their worst month since 2013, global demand and especially Chinese retail, investor and official demand continues to remain very robust. Indeed, China looks likely to see a new record demand for gold annually again in 2015.

Shanghai Gold Exchange (SGE) deliveries as reported last Friday were again very robust with another 54.063 tonnes of bullion deliveries for the week ending November 20th. Shanghai Gold Exchange (SGE) deliveries remain the best indicator or proxy for actual Chinese demand and appear to show Chinese gold demand is heading for a new record in 2015 (see charts below).

China added another 14 tonnes or 450,000 troy ounces of gold bullion to its foreign exchange reserves in October.

Gold reserves rose to 1,722.5 metric tonnes or 55.38 million troy ounces at the end of October. This was up from 54.93 million at the end of September, data from the People's Bank of China (PBOC) showed today.

China’s increasingly powerful central bank has been adding between 14 tonnes and 19 tonnes of gold every month. The strong demand and positive view of gold comes as the country looks to diversify its massive foreign exchange reserves of over $3.5 trillion.

China’s diversification into gold was again healthy and robust in ounce or weight terms but remains small in dollars terms at just $477 million at today’s prices - 0.00136% of fx reserves or 1.6% of fx reserves on an annualised basis.

China’s sharp devaluation of the yuan this summer sparked another gold bar and coin “buying spree” in China according to the World Gold Council in their recent Gold Demand Trends report. Prudent Chinese store of wealth buyers are again protecting their wealth from volatility and sharp falls in stock markets and indeed in some property markets.

Contrary to the widely held belief that gold bullion demand is subdued, it is actually very robust and, indeed, surging in key markets such as China. Data shows that surging demand for coins and bars and a rise in buying by central banks pushed physical gold demand up 7% in the third quarter. Demand for gold coins and bars jumped by 26% year-on-year in the last quarter, GFMS analysts at Thomson Reuters reported in the Q3 update of their Gold Survey 2015.

Retail investment surged in top buyers China, India and Germany - rising 26 percent, 30 percent and 19 percent respectively. Those three markets alone accounted for an additional 26 tonnes of bullion buying.

This data was confirmed by the World Gold Council. Their data shows global investment demand saw a significant rise of 27% to 230 tonnes, up from 181 tonnes in Q3 2014. Overall demand increased by 8% year-on-year to 1,121 tonnes as selling of futures contracts and ETFs contributed to a price dip, 6% in July, which buoyed gold bullion demand around the world.

Another example of how large concentrated liquidations in the futures market on the COMEX is for the moment leading to lower prices - artificially so - was seen in trading on Friday after the Thanksgiving holiday on Thursday.

 

More peculiar trading on the COMEX was seen when 18,000 gold futures contracts, worth nearly $2 billion, were dumped on the market at a time when the market was less liquid (See chart).

The nature of the selling again appeared to suggest that the seller may not have a profit motive in mind. The selling did both psychological and technical damage to gold. Gold sentiment already battered will not have been helped by the move and technically gold prices have fallen below what Goldman Sachs and others see as a "crucial level" technically.

As has been the case on a number of occasions in the course of gold’s bull market, gold prices are ignoring positive real world physical supply and demand factors as the futures market wags the tail of the gold dog.

We expect very robust Chinese and global bullion demand to bark soon and re-assert themselves and speculative players short the market may incur a nasty bite as will those with no allocation to physical bullion.

The deterioration in the fundamentals of the global economy are so important that the Fed are suggesting that they will increase interest rates.

Despite this, all eyes are again on the Fed and the possibility of a meager 0.25% interest rate rise. The Fed has been suggesting that this would happen for many months and, as ever, it is always best to watch what they do rather than what they say.

Ignore the noise of the Fed and continue to focus on the long term fundamentals driving the precious metals market. Even if they do increase interest rates today, negative real interest rates look set to continue for the foreseeable future.

Gold’s long term diversification value and benefits continue to be largely ignored in favour of simplistic analysis and a superficial focus on gold’s nominal price action in solely dollar terms.

Short term speculators and weak hands have again been washed out of the futures market due to the recent price weakness and many speculators are now short due to the poor technicals.

Prudent investors will continue to gradually accumulate physical bullion on dips like the Chinese. Given the variety of macroeconomic, systemic, geopolitical and monetary risks in the world today, owning gold and silver bullion in the safest vaults in the world has never been more prudent.

Read more on GoldCore.com

 

DAILY PRICES

Today’s Gold Prices: USD 1055.65, EUR 998.20 and GBP 703.05 per ounce.
Friday’s Gold Prices: USD 1064.65, EUR 1005.79 and GBP 707.73 per ounce.
(LBMA AM)

Gold in USD - 10 Years

Gold lost $12.00 on Friday closing at $1058.60, down 1.73% overall for the week.  Silver closed at $14.10, down $0.09 which is a 0.56% loss for the week.  Platinum continued its slide losing $15 on Friday, closing at $833.

 

IMPORTANT NEWS

Gold prices under pressure as dollar climbs – The Bullion Desk
Gold Heads for Worst Month Since 2013 as Central Banks Diverge – Bloomberg
Gold poised for worst monthly dip in 2-1/2 years – Reuters
Holiday shopping unlikely to cheer many investors – Reuters
IMF to make Chinese yuan reserve currency in historic move – The Telegraph

IMPORTANT ANALYSIS

“Very bullish outlook for the gold industry” – Bloomberg
Is This The Gold Cartel’s End Game? Gold Eagle
Paul Craig Roberts On Gold and “Massive Government Corruption” – ZeroHedge
Thanksgiving amid the Threats of War and Terrorism – Maudlin – Goldseek
Economy needs more than Luck – We Need a Plan B – McCarthy – Independent
Elites still can’t see just how much damage they are doing – Independent
Even after rate hike, Fed will probably keep rates unusually low for years – Bloomberg

Read more News & Commentary on GoldCore.com

First published here: http://www.zerohedge.com/news/2015-11-30/gold-demand-china-heading-record-and-reserves-increase-14-tonnes-october

Europe is now ground zero for the war on cash.

 

Europe is perhaps the most centrally controlled political system in the world: a place in which political and economic policies range from socialist (the public sector accounts for 30% of “free market” German’s employment) to extremely socialist (the public sector accounts for 56% of France’s employment).

 

As such, Europe is where a Central Banker can implement the most insane policy and get away with it.

 

Remember, it was Europe that first implemented “bail-ins” in which deposits were STOLEN to bail out a bank.

 

It was also Europe that first implemented Negative Interest rate Policy or NIRP.

 

And it was Europe that banned using physical cash in numerous transactions: France and Spain have banned any transaction over €1,000 or €2,500, respectively, from using physical cash.

 

Despite having implementing both NIRP and QE, Europe’s economy is lurching back towards deflation. So now the ECB is looking into even more extreme measures to trash cash in an attempt to drive capital into risk assets.

 

At the top of the list?

 

Staggering charges on banks that are “hoarding cash.”

 

Euro zone central bank officials are considering options such as whether to stagger charges on banks hoarding cash or to buy more debt ahead of the next European Central Bank meeting, according to officials.

 

Little over a week before the meeting to set the ECB's policy course, numerous alternatives are open, from snapping up the bonds of towns and regions to introducing a two-tier penalty charge on banks that park money with the ECB.

 

Officials, who spoke on condition of anonymity, said that even buying rebundled loans at risk of non-payment has been discussed in preparatory meetings, although such a radical step is highly unlikely for now. The ECB declined to comment.

 

Source: UK Reuters.

 

That’s correct. Sitting on cash is now an evil thing according to Central Bankers in Europe.

 

This is not the end of the war on cash. Ultimately it will culminate in efforts to impose a carry tax on physical cash if not ban cash outright.

 

Indeed, we've uncovered a secret document outlining how the Fed plans to incinerate savings to force investors away from cash and into riskier assets.

 

We detail this paper and outline three investment strategies you can implement

right now to protect your capital from the Fed's sinister plan in our Special Report

Survive the Fed's War on Cash.

 

We are making 1,000 copies available for FREE the general public.

 

To pick up yours, swing by….

http://www.phoenixcapitalmarketing.com/cash.html

 

Best Regards

Phoenix Capital Research

 

 

 

First published here: http://www.zerohedge.com/news/2015-11-30/europe-prepares-next-assault-war-cash

Filed under: Life Stage Lessons

Money is an important part of our lives. We buy what we need with it, we fund our future with it and we support others with it.

Unfortunately, there are a number of bad habits that can sabotage our financial well-being. Some of these habits won't destroy our finances right away, but over time, we may find ourselves in a dire situation with little hope of recovery.

Let's take a look at some of these bad habits and how you can avoid or conquer them as quickly as possible.

1. Smoking. According to the CDC, "Tobacco use remains the single largest preventable cause of death and disease in the United States." Talk about bad for your finances and your health.

Let's pretend for a moment that the only cost from smoking is what hits your wallet -- not your lungs. OK, how much will you be spending?

Let's say that a pack of cigarettes costs you $4.49 -- although the price widely varies from state to state. And, let's say you smoke two packs a day. That's $8.98 a day.

There are 365 days in a year, so that'll cost you about $273.14 a month. That's a lot of money -- especially when you figure that you could have invested that money. Let's say you invest that amount of money every month for 10 years with an 8 percent annual return on your investment. You know what that comes to?

$51,280.92. Yeah, that's serious money.

Another way smoking can hurt your wallet is with life insurance. A client was looking to obtain term life insurance from me and in the process I learned that he was a smoker. While I was shocked to find out I was even more shocked to see how much more life insurance is for smokers. In his case, his life insurance policy was more than three times more expensive than someone that doesn't smoke.

Remember, we're just figuring in the cost of the cigarettes on your wallet. How about the health consequences? The cost of medical procedures and the lost opportunities when you're on chemotherapy are staggering.

Avoid smoking. It's one bad habit that kills more than your financial well-being.

2. Using credit cards irresponsibly. How many credit cards do you have in your wallet right now? Two? Five? Eight?

While it's not necessarily a horrible thing to have credit cards, it is a horrible thing to use them irresponsibly. And, unfortunately, that can be easily done.

Sure, you can earn some pretty nice rewards by using credit cards on a regular basis. But remember, if credit card companies weren't making money by giving away some money, they wouldn't do it. That means that the average guy or gal can't win by using credit cards. The average guy or gal would pay more in interest on their credit cards than they would make through the rewards programs. No good.

Okay, so you think you're above average. That's cool. You're going to need to prove it by following one little tip. What's the tip? I never thought you'd ask ...

Pay off your credit cards every single month.

That's right, before you use your credit cards, you need to make sure that you will be able to afford the bills that come every month. And really, for many people, the only way to do that is to get on a budget and make sure that you have the money before you spend it.

So if you're going to use credit cards, get on a budget and pay off those credit card bills like clockwork. Get in the habit of doing the right thing with your money, not the wrong thing.

3. Eating out during your lunch breaks at work and making other small miscellaneous purchases. It's just too easy to head down the street, swipe your card and get a meal. The problem is that it can end up costing you a lot of money.

Let's say you spend $7.50 a meal four days a week. That could come to about $120 a month or $1,440 a year. That's a lot of money, honey.

Keep in mind that eating out on your lunch breaks alone probably won't kill your finances, but if you add to that getting your morning coffee at your favorite java joint, buying that bagel to go with it and picking up some candy bars after work, now it's starting to look like a bad habit that will inevitably kill your finances.

Of course, this entire article is assuming you don't have a money tree growing in your back yard (if you do, I recommend keeping it out of sight). If you're the average American, living like the average American and making little purchases throughout the day just isn't an option if you want to have a decent retirement and leave some money for your kids when you reach your final destination.

Don't discount this tip. Entire industries thrive by selling low-cost goods. Don't let these little expenses sneak up on you and destroy your financial situation.

There is some "good" news if you're in the habit of making multiple small purchases every day. You know what it is? It's that you probably won't experience a sudden downfall due to your spending behavior. It will happen slowly over time without you realizing it. Perhaps that's not such a good thing after all.

4. Buying a new car every couple of years. Every time I hear of a person buying a new car every couple of years, I almost roll my eyes. There are worse things, but not much is worse than forking over $20,000 every few years.

Driving older cars can save you so much money it can make your head spin. Now, I'm not recommending you drive something from the '50s, '60s or '70s. Hitting your head on a metal steering wheel probably isn't much fun -- just saying. The cars I'm talking about driving are maybe five or 10 years old. These cars have depreciated enough and are safe enough to represent tremendous value in your life -- especially to your finances.

Mechanics will tell you that new cars like hybrids and electric vehicles aren't quite yet cost-efficient. Why? The batteries. When the batteries have to be replaced every few years, you might end up spending more than you'd save by not having to purchase gasoline. So next time you try to convince yourself that you "need" a new car because of the efficiencies involved, make sure to do your math first.

If you haven't noticed, newer cars cost a whole lot more to cover with auto insurance than older cars. Plus, when you have newer cars, you're probably going to be tempted to raise your comprehensive and collision coverage -- and those coverages cost a pretty penny.

Be smart when it comes to vehicles. Your finances will thank you over time.

5. Winging it (financial planning) and hoping for the best. I have clients step into my office all the time to ask how much money they need to save every month for retirement. Do you think I tell them all the same thing? Of course not. How much they need to save depends on their current financial status, what the future holds, and their goals.

For example, I'd want to know how much money they think they could live on in retirement and then I'd need to account for inflation. Then we'd have to look at what they can expect from various investments from now until they retire and beyond. I'd also need to know about any major expenses that they have coming up. The list goes on and on.

True, you can drive yourself crazy accounting for every little data point in the process. But it's certainly worth some exploration. After all, you don't want to retire only to realize five years later you blew it by quitting your job.

That's why I recommend meeting with a financial adviser who can help you create a financial plan. Now, I'm not just talking about investing, you're going to need a professional who will help you look at the big picture.

It's also worth your time to understand how financial advisers get paid. They need to demonstrate their value to you before you sign on the dotted line.

When it comes to financial planning, don't wing it. Hire a professional, educate yourself, and make a plan.

By overcoming these bad financial habits, you'll find yourself enjoying a healthier bank account and more time to do the things you want to do in life. Don't let money rule your life -- you tell it what to do.

 

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First published here: http://www.dailyfinance.com/2015/11/30/bad-habits-hurt-your-finances/

Filed under: Retail, Holiday Shopping, Internet, Deals, Stores

By MAE ANDERSON

NEW YORK -- Retailers are rolling out online deals on so-called "Cyber Monday." But now that shoppers are online all the time anyway, the 10-year-old shopping holiday is losing some of its luster.

Still, Monday is expected to be the biggest online shopping day ever, with estimates that it will rack up more than $3 billion in sales.

"It's no longer about one day, but a season of digital deals," said Matthew Shay, president of retail trade group The National Retail Federation.

Online shopping is taking its toll on brick-and-mortar shopping. Frenzied crowds seemed to be a thing of the past on Black Friday -- the busy shopping day after Thanksgiving -- and sales fell to $10.4 billion this year, down from $11.6 billion in 2014, according to preliminary figures from research firm ShopperTrak.

But as online shopping grows more popular on Thanksgiving and Black Friday, that's causing less of a frenzy on Cyber Monday, too.

"Consumers are recognizing the Internet is the place to go for a deal any time, any day," said Gene Alvarez, managing vice president of research firm Gartner (IT).

Retailers have been touting online deals since the beginning of November. And they no longer wait for Monday to roll out Cyber Monday deals, either. Amazon (AMZN) started "Lighting Deals" on Saturday and Walmart (WMT) began all of its cyber offers at 8 p.m. Sunday.

Amazon was offering 65 percent off sweaters, Target (TGT) was touting 15 percent off its whole site for the first time and Walmart offered $500 off a $1,200 LG 65-inch 4K Ultra HDTV.

"I personally skip Black Friday just to shop Cyber Monday," said Mark Flores, a parks and recreation director from Lynwood, California. He was looking online Monday for tablets for his nephews, nieces and grandparents, leather goods and gift certificates, plus shoes for himself on Amazon, department store sites and the Groupon App. He said he was looking for deals "that are greater than normal sale prices and coupons."

Research firm Comscore expects online sales to rise 14 percent to $70.06 billion During the November and December shopping period, slowing slightly from last year's 15 percent rise. Online sales make up 10 percent of overall retail sales, but that increases to 15 percent during the holidays as online shoppers snap up Black Friday and Cyber Monday deals, according to research firm Forrester (FORR).

Cyber Monday itself is expected to be the biggest online sales day of the season and ever, surpassing $3 billion in sales. If so, it will be the sixth year in a row that Cyber Monday is the biggest online shopping day ever.

But Thanksgiving and Black Friday are gaining fast. About $4.47 billion were spent online on Thanksgiving Day and Black Friday combined, 18 percent more than last year, according to Adobe, which tracks 200 million visitors to 4,500 retail websites. And 33.2 percent came from mobile devices, up from 27 percent last year.

Amazon is offering new deals every 5 minutes starting Friday, Nov. 20, and extending through Dec. 5 double the cadence of last year. It also is offering more than 150 app-only lightning deals to encourage mobile shopping.

Walmart started offering all of its 2,000 Cyber Monday deals -- quadruple the 500 online deals it offered last year -- starting at 8 p.m. Sunday the evening before. A year ago, the nation's largest retailer only offered a sneak peak of about 20 deals on the evening before Cyber Monday.

And Target is offering 15 percent off its entire site on Cyber Monday, its first ever site-wide discount on the shopping day.

Forrester Research analyst Sucharita Mulpuru said even though more people are shopping online and on their phones throughout the season, Cyber Monday will still drive sales from its name alone.

"A lot of people waiting to see if deals are better on Cyber Monday," she said.

The name "Cyber Monday" was coined in 2005 by the National Retail Federation's online arm, called Shop.org, to encourage people to shop online. The name was also a nod to online shopping being done at work where faster connections made it easier to browse. Now, even with broadband access, Cyber Monday continues to be a day when retailers pull out big promotions.

"I plan on scoping out the deals," said Diane Boral, 33, from Oxnard, California, who planned to shop online at Walmart, Target and other stores Monday. She said she hoped to get most of her Christmas shopping done on Cyber Monday. She was looking for deals ranging from 20 to 75 percent off on items like a camera, air conditioner, tires and Christmas gifts.

Most of her shopping is done online via her iPhone and laptop, she said.

"I have more time to browse for items," online, she said.

 

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First published here: http://www.dailyfinance.com/2015/11/30/cyber-monday-sales-still-strong-losing-luster/