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Friday, 3 July 2015

Australian Stocks Plunge - With China / Greece Fears, & Top Buffet Insights







Australian stocks fall steeply on Greek worries, China share crash


Australian shares have closed down more than 1 per cent as traders cut their exposure ahead of this weekend's Greek referendum and as China's stock market crash worsens.
The benchmark ASX 200 index finished off 62 points, or 1.1 per cent, to 5,538, while the broader All Ordinaries index was off 60 points at 5,528.
IG Markets institutional trader Chris Weston said the fall reflects "gap risk" around the Greek vote, which takes place on Sunday, meaning that traders cannot react immediately, but could be queuing sell orders on Monday morning, with few willing buyers.
"You can't deal when the market's closed but, when it does open, you get a situation where the market could open 3 per cent lower for example," he said.
"Depending on what you're in, that stock will open potentially 2 to 10 per cent lower."
Mr Weston warned that US Dow Jones Industrial Average futures could be down 400-500 points on a "no" vote, a fall of 2-3 per cent, and there is not a lot of upside to be had.






50 best things Warren Buffett told investors over past 50 years



It’s been 50 years since Warren Buffett — a.k.a. the Oracle of Omaha — took control of Berkshire Hathaway BRK.A, -0.21% BRK.B, +0.07%   and turned a sleepy textile company into a powerful conglomerate with multiple businesses and investments. And that means it’s been 50 years since Buffett started writing his annual letter to shareholders.
The 2014 edition — the epistles always refer back to the previous year — gives us the perfect excuse to review all 50 letters and find 50 of the most memorable quotes from them.
Keep in mind that Buffett’s early letters — some of which were not actually signed by him — featured little more than straightforward accounts of Berkshire’s finances. But by the late 1970s, the oracle started, well, oracle-ing, offering pointed, humorous and sage-like commentary on the markets. And along the way, the cost-conscious billionaire wasn’t afraid to make fun of himself (and his one indulgence — namely, a private jet).
Read and enjoy.




Image result for homeless person

US debt is north of $18 trillion. (Amazingly, *cough*, it hasn’t changed in months *cough*.) Forward promises are north of $200 trillion, meaning that a child born today is responsible to repay $625,000. And since roughly half the US population pays no income tax… and presuming that this newborn will be a member of the productive half… he or she is born $1.25 million in debt. Such repayments will never happen. Most of those debts will not be repaid.






It did so for all the reasons that I’ve mentioned before — namely that Germany cannot allow a Grexit from the euro zone without ultimately destroying the German economic miracle of the last few decades … and the Greeks outside the euro would see their modern lifestyles crumble in the face of sharp inflation and radically reduced access to the imported goods they take for granted today







The confederation, which represents some 280,000 small and medium-sized businesses, has been badly hit by capital controls. More than half of Greece’s food and raw materials are imported, but without a functioning banking system there was no way to wire money abroad and pay for supplies, said Korkidis.
“Multinationals can, but local companies can’t,” he sighed. “Shortages are manageable this week because traders have stock, but next week that won’t be the case. We are experiencing things we never thought we’d see.”








To quantify the volatility the following chart shows the (absolute value of) percent deviation from silver’s 200 day moving average. A spike higher or lower is volatility. The six spikes in volatility above 40% deviation from the 200 day moving average are quite large.




Image result for euro zone sinking


Eurozone consumer prices rose for the first time in six months during May, a victory for the ECB in its campaign to avoid a debilitating period of deflation, during which businesses and households might hold back on spending in the expectation that they will get better deals in the future.
Tuesday is the final day of the state's current budget year, and top officials turned to planning for a Wednesday in which Illinois government has limited authority to spend money. It's also the day a cash-strapped CPS is due to make a $634 million pension payment





Financial soundness of South Korean households worsened in the first quarter as their debts snowballed on the back of low interest rates, a report showed Tuesday, adding to persistent concerns that a looming U.S. rate hike may unleash credit risks.




As systemic solutions fall short, we must grasp the nettle of making our own arrangements in a time characterized by burgeoning demands and diminishing resources, capital and security.
The idea that our large-scale problems could be fixed with systemic reforms is enticing: replace the thousands of pages of tax code with a simple flat tax without deductions, for example, or the replacement of too big to jail/fail banks with community-owned banks that served the public, not shareholders.
But the attraction of reforms is a siren song, because our system is run by vested interests for vested interests, period. Any real reform is Dead On Arrival (DOA) because any real reform threatens the swag and security of vested interests.


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