The Big Picture

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• Succinct Summation of Week’s Events (5.13.11)
• How Corporations Avoid Paying Taxes
• Greece
• Solar System Scope: Click & Drag your way through the Cosmos
• S&P500 Update
• Jim Bianco Interview on China’s Economy
• Amazon.com: the Hidden Empire
• Here’s the thing you need to understand about Cramer…
• Ian Bremmer of Eurasia Group on China, Commodities
• Friday Reads

Succinct Summation of Week’s Events (5.13.11) Posted: 13 May 2011 12:30 PM PDT Succinct summation of week's events: Positives: 1) UoM confidence jumps back to average level of the year as one year inflation expectations dip to 4.4% from 4.6% 2) 5 month low in mortgage rates leads to 9% jump in refi’s and 6.7% rise in purchase application 3) Germany and France lead solid Q1 GDP growth for Euro zone but sustainability in question 4) Hong Kong economy grew 11.2% annualized in Q1 5) China again raises reserve requirements after 5.3% CPI print and greater than expected loan growth. Negatives: 1) CPI, PPI continue to rise with CPI now back above 3% y/o/y 2) Inflation takes bite out of April retail sales as sales ex gasoline rise just .2% 3) Initial Jobless Claims above 400k for a 5th straight week and 4 week average now at the highest since Nov 4) Weak US$, energy prices and higher Chinese labor costs lead to 11.1% y/o/y gain in Import Prices 5) NFIB small business optimism index falls to lowest since Sept with most growth categories lower and price index higher 6) BoE’s King says UK in stagflationary environment, is it headed here? 7) Political infighting amongst the EU, IMF, ECB and individual country members continue to drag out the fate of the Greek’s.

How Corporations Avoid Paying Taxes Posted: 13 May 2011 11:00 AM PDT This is the first third of the graphic; click for larger graphic Online MBA hat tip Business Pundit

Greece Posted: 13 May 2011 10:36 AM PDT Just on the tape, a Germany newspaper is reporting that the EU, IMF and Germany want a Greek debt extension while the ECB (holders of Greek debt) and France oppose it. Just enough information on a Friday afternoon to confuse and muddy the waters further.

Solar System Scope: Click & Drag your way through the Cosmos Posted: 13 May 2011 09:59 AM PDT Fantastic use of a website! > click for interactive site

S&P500 Update Posted: 13 May 2011 09:30 AM PDT S&P 500 Index (SPY) Trend Status Neutral click for larger chart Source: FusionIQ > Kevin Lane, CIO of Fusion analytics, observes: “As seen in the chart above the S&P 500 tested support and bounced from the 1,330 area (lower green line) for the second time in the last six days. Yesterday's low also coincides with a rising uptrend line (orange line). That said we believe this is now the critical line that separates a continued extension of the current rally and the start of a spring correction. If this level is violated the trade will turn down for a while and it would be a time to keep the defense on the field for a while and the offense got a breather. For the trade to turn a bit more bullish the S&P would have to get back above the minor downtrend (purple line) near 1,350.”

Jim Bianco Interview on China’s Economy Posted: 13 May 2011 09:12 AM PDT

Amazon.com: the Hidden Empire Posted: 13 May 2011 08:00 AM PDT Amazon.com: the Hidden Empire View more presentations from faberNovel

Here’s the thing you need to understand about Cramer… Posted: 13 May 2011 07:24 AM PDT There is a hefty profile of James J. Cramer in the NYT magazine this weekend that is worth reading. But here’s the one thing you need to understand about Jim Cramer:  If you read financial blogs or follow StockTwits or do any sort of research online, the archeology of that traces back to Cramer. He is the Big Bang of financial blogging, the “Adam & Eve” of online financial research. That sort of farsight is none too common in this business. You may not know this, but TheStreet.com was a factory that churned out award winning journalists and market beating fund managers like Hershey’s kisses. Josh Brown, once likened TheStreet.com to the “Motown Records of the Financial Web.” They were the farm team for the world of financial reporting, where the media bigs came to look for the next hire. The number of people who came out of TSCM to become household names in financial reporting and asset management is quite astonishing: TheStreet.com alumni include Aaron Task (Yahoo Finance), Jesse Eisinger (WSJ/ProPublica) who just won a Pulitzer, Herb Greenberg (CNBC), James Altucher (FT/WSJ), Justin Lahart (WSJ), Paul Kedrosky (Bloomberg), Adam Lashinsky (Fortune), Alex Berenson (NYT), Simon Constable (WSJ), Dave Kansas (WSJ), Gail Griffin, (Barrons), John Edwards (WSJ) David Gaffen (WSJ), Lauuren LaCapra (Reuters), Colin Barr (Fortune), Tim Arango (NYT), Dagen McDowell (Fox), David Reilly (Bloomber/WSJ), Peter Eavis (WSJ). Fund managers like Doug Kass, Whitney Tilson, David Merkel, Jeff Matthews, Helene Meisler, Jon Markman, Todd Harrison, and the list goes on and on. I myself am a proud TSCM alumnus. I have on occasion criticized Jim for some position or another he has taken on sub-prime or housing or the Fed, but that comes with the territory. As much as people bash Cramer, consider this: He is the guy who first conceived of Democratizing financial research and reportage. Whatever money he made for clients as a hedge fund manager is far outweighed by his contribution to you, the modern investor. The fact that you are reading this on blog, that you may have found on Twitter, traces its roots back to his original idea: That stock research should be accessible to anyone, not merely the privileged few whose large accounts gave them access to analysts. > Previously: The Cramer Abides (March 3rd, 2011) Source: Jim Cramer Hits an All-Time High ZEV CHAFETS NYT, May 11, 2011 http://www.nytimes.com/2011/05/15/magazine/jim-cramer-hits-an-all-time-high.html

Ian Bremmer of Eurasia Group on China, Commodities Posted: 13 May 2011 06:36 AM PDT ~~~ Source: Commodities Tumble: Is China's Economy Next? Peter Gorenstein Yahoo Daily Ticker May 12, 2011 http://finance.yahoo.com/blogs/daily-ticker/commodities-tumble-china-economy-next-155455697.html

Friday Reads Posted: 13 May 2011 06:15 AM PDT Here are today's favorite reads: • Foreclosures crush home prices (CNN Money) See also Federal Retreat on Bigger Loans Rattles Housing (NY Times) • The theory of rockets and parachutes: a primer on US gasoline prices (The Barrel) • What the Mafia teaches about fiscal policy (Olaf Storbeck) • The Bond Vigilante (The Atlantic) • Faulty Towers: The Crisis in Higher Education (The Nation) • The great corporate tax swindle (Guardian) • A Crude Guess About The Future (Freakonomics) • Unspoken Truths (Vanity Fair) • Trader Joe’s Joe: Joe Coulombe (LA Times) • Is College a Rotten Investment? (Slate) • The Tragedy of Sarah Palin (The Atlantic) In Alaska, she was a bi-partisan legislator who focused on the states’ problems. What went wrong? What are you reading?

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