Central Perk

miercuri, 22 iulie 2015

Mish's Global Economic Trend Analysis

Greece Crisis: A Musical "Grease" Parody

Posted: 22 Jul 2015 01:19 PM PDT

Several readers sent me this extremely well executed musical parody of Grease, on Greece.

Link if video does not play: Greece Crisis, the Musical "Grease" Parody

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Watching Yields Rise: Are Treasuries a Buy?

Posted: 22 Jul 2015 12:07 PM PDT

From mid-2012 until the beginning of 2014, US treasuries were in a steep decline (yield rising) in expectations of Fed rate hikes that never came.

2014 was a great year for treasury bulls, undoing the carnage of the previous year and then some. 30-year treasuries hit a record low yield.

So far, 2015 has been a bad year for the bulls.

Monthly Yield Curve 2005-2015

Charts courtesy of Curve Watchers Anonymous.

Daily Yield Curve 2015

click on any chart for sharper image

Yields generally bottomed in February, then rose to early-June highs, with the long end sporting a steeper slope as is typical.

Are Treasuries a Buy?

Setting aside the often-heard "certificates of confiscation" phrase, treasuries are a reasonable buy if one believes yields are going to stay steady or decline. They are to be avoided if the expectation is for yields to rise.

Part of the question is whether or not the Fed hikes, and by how much. But it's more complicated than the typical "yes-no when" analysis that we see in the media.

It's very conceivable for short-term rates to rise but long-term yields to decline if the market becomes convinced that Fed hikes will slow the economy. There's even a recent hint of that possibility looking at the action in treasuries since mid-July (the yield on 5-year treasuries has risen faster than yield on 10- and 30-year treasuries.

I am still not convinced the Fed is going to hike this year. Much will depend on retail sales, housing, and jobs.

A good retail sales report will send yields soaring, likely across the board.

Finally, even if economic data is weak, there is a chance yields rise if inflation picks up. Thus, one needs to keep inflation in mind, especially over longer time-frames.

That said, the recent decline in crude, commodities in general, does not lend much credence to the notion the CPI is going to take big leaps forward any time soon.

All things considered, the long end of the curve seems like a reasonable buy here provided
one believes as I do, that economic data is unlikely to send the Fed on a huge hiking spree, and that if and when the Fed does react, yields on the long-end of the curve may not rise as everyone seems to expect.

Risks are strong economic data, inflation, and a bond-yield hike-tantrum even if economic data is weak. Fed hikes, in and of themselves, are not the critical factor.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Damn Cool Pics

What $1,500 A Month In Rent Would Allow You To Live In Around The World
11 Popular Tourist Attractions That Might Kill You
30 Years Later The Cast Of Back To The Future Reunited In London

What $1,500 A Month In Rent Would Allow You To Live In Around The World

Posted: 22 Jul 2015 02:01 PM PDT

In some cities you could score a nice place to live for $1500 a month. Other cities you might be better off sleeping in a cardboard box.

Posted: 22 Jul 2015 01:33 PM PDT

These tourists attractions are truly unique and if you visit them you'll have a great story to tell. The only problem is you might not survive the trip.

Kjeragbolten

This rock sits 3,245 ft in the air between two boulders in Rogaland, Norway. You don't want to be present when gravity decides to bring this down

Trift Suspension Bridge

This bridge sits 330 ft in the air and stretches 560 feet (only 3 feet wide) in the Swiss Alps. The view is spectacular, but you might want to avoid looking down.

Stolen Chimney, Fisher Towers
This summit is a park of Utah's Moab National park and is noted as one of the most precarious peaks in the world. But why must people climb it?!

El Caminito Del Rey "The little King's Path" Malaga, Spain

Known as the Little Pathway of the King, this was built in 1905 and has had little to no repairs done until recently. Therefore, bold climbers enjoy braving the sections that are most dangerous and even completely disintegrated.

Devil's Pool, Victoria Falls

You'll have to travel to South Africa if you want to see this beautiful 355ft cascade. But get this, people literally die trying to get the perfect photo here, yet the tourists (and tour guides) continue to risk their life visiting this once in a lifetime view.

Hussaini Hanging Bridge

Located in Northern Pakistan, this is one of the most dangerous bridges in the world, as it has been poorly maintained and the elements have taken their toll on it's structure.

Cliffs of Moher

This dangerous Ireland (unofficial) bike trail was featured in The Princess Bride! But don't expect to this to be a cake walk. It's only about 4 feet (at it's biggest sections) and it's continuously crumbling.

Mount Huashan

The trek up Mount Huashan is considered one of the most dangerous, yet popular ascents in China. Hundreds of tourists flock to the nearly vertical staircases and creaky bridges of this location.

Huayna Picchu

There is no better view of Machu Picchu than from this summit. But getting there is the hard part. Unkept trails, steep staircases and the high altitudes make this trip a treacherous one.

Trolltunga

Trolltunga, which stands for Troll Tongue, is one of Norway's most population outlook spots. It was formed thousands of years ago but glaciers that slowly chipped away at the rock. Do you dare visit it's edge?

Yungas Road

This road in Bolivia is accurately named The Road Of Death, due the hundreds of lives that it has claimed. The roads of this mountain are poorly maintained, leading to numerous accidents on the most trafficked parts.

30 Years Later The Cast Of Back To The Future Reunited In London

Posted: 22 Jul 2015 11:58 AM PDT

It's been 30 years since the release of "Back to the Future" and the film is still just as popular as it ever was. Michael J. Fox, Christopher Lloyd and Lea Thompson all get together for a panel at London Film and Comic Con over the weekend and they looked happy to be reunited.