Revenge
of the Japanese Zombie Banks Posted by :
testosteronepit
Post date:
09/17/2013 - Plowed $2 trillion of their Japanese
deposit base into investments overseas then wondered why the economy at home
languished
Gold Is Not A Safe Haven? Tell That To
People In Indonesia Posted by:
GoldCore Post date:
09/17/2013 - The U.S. Federal Reserve is insolvent
and has liabilities of over $3.2 trillion and yet has capital of just $60
billion. Therefore, it is leveraged by fifty to one, akin to a highly leveraged
hedge...
USA: Stagflation Here We Come!
Posted by:
Pivotfarm Post date:
09/17/2013 -Just when you think that the worst has
come, been and gone, there will be more stuff hitting the fan in the very near
future and that should serve as a lesson to the next head of the Federal
Reserve...
In a
long and proud tradition started by Solyndra and A123, and going through such
Tesla ancestors as the Fisker Karma and Coda, the US government continues to
demonstrate that when it comes to misallocating capital, albeit in (or due to)
the pursuit of noble "green" causes, it has no peer. Fast forward to
today, when we find that the latest casualty of a world in which ridiculous
business models and lack of cash flows does not result in an Amazon-esque happy
ending, is Eco(fa)tality, a maker of batteries and Blink charging stations for electric
cars, which
overnight filed for bankruptcy. If fact, do not pass go, do not pretend to
have anything even remotely close to a sustainable business mode, and go
straight to a liquidation auction.
The
Federal Reserve is in a classic double-bind: as its policies to boost
growth bear fruit, interest rates rise, threatening the very recovery the Fed
has lavished trillions of dollars of quantitative easing (QE) to generate. Put
another way: if growth is needed to boost corporate sales and profits, but
growth leads to higher interest rates and reduced central-bank suppport of
markets, this is a double-bind with no exit.
Over
the past year, India has unleashed the most unprecedented series of gold
"capital controls" ever seen in a modern nation, shy of confiscation
(and even that
may be imminent). Today, India added yet another more measure to its list
of prohibitions that seek to minimize the size of the gold market available to
citizens, yet which will only result in even more interest and demand in the
yellow metal. As Reuters reports, India increased its import duty on gold
jewellery from 10 percent to 15 percent, setting it higher than the duty on raw
gold in a move to protect the domestic jewellery industry. Why is the
government doing this? Simple: "To protect the interests of small
artisans, the customs duty on articles of jewellery ... is being increased,"
the ministry said.
While the White House is trying to play this down currently in the press
conference, Brazil's President Rousseff has issued a statement postponing her
trip to the US due to the illegal espionage of the Americans:
*BRAZIL SAYS U.S. HASN'T
PROVIDED ADEQUATE EXPLANATION ON SPYING
*BRAZIL'S SAYS IT NEEDS U.S.
EXPLANATION BEFORE STATE VISIT
*BRAZIL SAYS U.S. ILLEGAL
MONITORING OF GOVT, COS. IS 'SERIOUS'
*BRAZIL PRESIDENT ROUSSEFF
POSTPONES STATE VISIT TO THE U.S.
According to AP, Obama spoke to Rouseff on the phone but that didn't do
it as the Brazilian President demanded a full public apology.
Today's
TIC data showed something disturbing: for the fourth month in a row, foreigners
were net sellers of US Treasury paper in July , as total foreign holdings
declined from $5.600 trillion to $5.590 trillion which represents 49% of total
marketable debt (including the debt owned by the Fed of course). In other words,
since peaking at $5.724 trillion in March, foreign-held debt has declined by
$134 billion, at a time when yields have surged on fears the Fed's tapering of
its own purchases of bonds will mean less Fed frontrunning opportunities.
However, it is only when broken down by gross purchaser, that we see just who
is to thank for this surge in buying of Treasury paper in the month of July.
One look at the chart below should explain it...
Equity markets were quietly confident that no matter what the
mortgage market did, the Fed would save them in 2007. Bond markets
had already got a little nervous as collateral squeezes and forced liquidations
had led to a large jump in bond risk relative to equity risk - but again this
was eschewed by any number of equity long-only managers and their
non-money-managing partners-in-crime - the sell-side strategist - who confirmed
that any dip should be bought and the increased risk in bonds was exactly the
catalyst to rotate to stocks for the long-term. Fast-forward $8 trillion and
five years and the patterns of bond and equity risk look awfully
similar - as does the echo chamber of status quo opinion at
the 'events' facing the market. History may not repeat, but we suspect
it will at least rhyme here...
With
spending habits waning amid soaring interestrates and rising gas prices, it is
perhaps useful to note the trends in the stickiest of spending habits -
tobacco, alcohol, and fast food...
Volume
is worst (pro rata) than yesterday in equities; AAPL is up though (but gold is
down oddly). In fact US equities are on their own heading into tomorrow's
angst... the USD is lower, Treasuries are flat, oil, gold, and silver are all
down, VIX is staying signficantly higher and HY credit spreads are
notably wider...
While
the issue of whether they will or won't taper is certainly still not clear, the
WSJ's
John Hilsenrath notes that the other dilemma facing the Fed is whether to
reduce their purchases of Treasurys, mortgage-backed securities or both.
According to officials, Hilsenrath notes, there were two lines of thinking at
the Fed on how to structure a pullback from the bond programs and the issue
would be discussed at the meeting. Goldman's Jan Hatzius has posited that "Fed
leadership probably views MBS purchases as more effective in boosting economic
activity than Treasury purchases," but as Hilsenrath notes, some
Fed officials prefer a simpler-to-communicate strategy of proportional cutbacks
to both MBS and Treasuries. The fact that Hilsy is reporting this suggests that
a Taper is somewhat inevitable - as we have noted since the
Fed remains cornered. On average, the market expects a $6bn taper on
Treasuries and $3 billion for MBS.
A
very soon tomorrow will bring the decision of the Fed concerning tapering into
focus. Ok, a kind of fuzzy, hard to see and wispy focus. The one thing
that we can assure you of is that whatever is to come our way it will not be a
singular event. You will hear from the imbibers of Cool Aid and other
mischievous reality altering drinks that it could be a one-off event. Tomorrow
a process will be started, it will probably go in fits and starts but
do not blind yourself; it will be the beginning of the journey to cut
back on the propping up of the markets by the Fed.
The
U.S. Census Bureau announced today that in 2012, real median household income
and the poverty rate were not statistically different from the previous
year. The 88-page report (found here) contains
a plethora of statistical data, slicing and dicing income and poverty data by
race, gender, and so on but in order to see through the haze, the following
three charts sum it all up perfectly (sadly). The poverty rate in the
US is stable at 15% - practically the highest since the mid 1960s and real
household incomes are stagnant at 1997 levels. Spot the cyclical recovery...
The July statement from the FOMC presented the following snapshot of the
economy, "Information received since the Federal Open Market Committee met
in June suggests that economic activity expanded at a modest pace during the
first half of the year. Labor market conditions have shown further improvement
in recent months..." but as Stone McCarthy notes, tomorrow's FOMC
post-meeting statement could well be less upbeat in tone, with hints of a
slowing in the pace of improvements in the labor market, housing, consumer and
business spending, and inflation remaining well below the 2% goal. A
look at the housing and spending data certainly raises eyebrows but it is clear
that the Fed remains cornered by deficits,
sentiment,
technicals,
and international
ire.
Prospective buyer traffic rose in all regions but the National
Association of Homebuilders key sentiment index missed Bloomberg median
expectations by the most since April. Future single-family home sales
expectations dropped notably and this is the first time since April that the
index has not risen. One data point does not make a trend change but given
mortgage rates, mortgage apps, and home sales, and now the expectations for
future sales, it will be hard for many to keep the housing recovery dream
alive... even if the Fed rolls back all their Taper talk and doubles-down on
QE...
A
snapshot of the top Bloomberg news from five years ago shows something very
unusual - an entire screen of negative headlines. Of course,
back then, bad news was indeed bad news... in our new normal, a smorgasbord of
cataclysmic event, terrorism, and systemic risk possibilities would likely be
reason to BTFATH as it guarantees the Fed will come to the
rescue... (just as they did eventually last time).
Do
you consider yourself to be "lower class"? Most Americans
wouldn't dream of thinking that way. Even at the toughest times of my own
life, I always considered myself to be "middle class".
Traditionally, the vast majority of Americans have described themselves as
either "middle class" or "working class", but now we are
witnessing a huge shift. According to survey results that were just
released, the percentage of Americans that identify themselves as "lower
class" is now at an all-time high. It is
still only 8.4 percent of the country, but the
fact that this number is rapidly growing shows that something is changing on a
very fundamental level. In America today, less people than ever believe
that they have the opportunity to make a better life for themselves, and
according to a brand new Gallup poll that
was just released, 20 percent of all Americans did not have enough money to buy
food that they or their families needed at some point over the past year.
We have 47 million people on food stamps and we have more than 100 million
Americans enrolled in at least one welfare program, and that does not even
count Social Security or Medicare. We have gone from a "land of
opportunity" to a land where tens of millions of people are being crushed
by the system. (Read More....)
As we approach the 100 year
anniversary of the creation of the Federal Reserve, it is absolutely imperative
that we get the American people to understand that the Fed is at the very heart
of our economic problems. It is a system of money that was created by the
bankers and that operates for the benefit of the bankers. The American
people like to think that we have a "democratic system", but there is
nothing "democratic" about the Federal Reserve. Unelected,
unaccountable central planners from a private central bank run our financial
system and manage our economy. There is a reason why financial markets
respond with a yawn when Barack Obama says something about the economy, but
they swing wildly whenever Federal Reserve Chairman Ben Bernanke opens his
mouth. The Federal Reserve has far more power over the U.S. economy than
anyone else does by a huge margin. The Fed is the biggest Ponzi
scheme in the history of the world, and if the American people truly
understood how it really works, they would be screaming for it to be abolished
immediately. The following are 25 fast facts about the Federal Reserve
that everyone should know... (Read More....)
The
more things change, the more things stay the same. The Great Depression
actually started in 1929, but as you will see below, as late as 1933 the
Associated Press was still pumping out lots of news stories with optimistic
economic headlines and many Americans still did not believe that we were
actually in a depression. And of course we are experiencing a very
similar thing today. The United States is in the worst financial shape that it has
ever been in, our economic infrastructure is being systematically gutted, and poverty is absolutely exploding. Since the stock
market crash of 2008, the Federal Reserve has been wildly printing money and
the federal government has been running trillion dollar deficits in a desperate
attempt to stabilize things, but in the process they have made our long-term
economic problems far worse. It would be hard to overstate how dire our
situation is, and yet the mainstream media continues to assure us that
everything is just fine and that happy days are here again. (Read More....)
How bad does it have to get before we admit
that America is an absolute cesspool of filth and wickedness? The
horrific Navy Yard shooting that took
place on Monday is yet another reminder that the thin veneer of civilization
that we all take for granted is rapidly disappearing. At this point,
nobody is fully safe anywhere in the United States at any time. Sadly,
the Navy Yard shooting was far from an isolated incident. Every day,
there are news reports that detail some of the most heinous crimes that you
could possibly imagine. In this article, you are going to read about
incredibly disturbing things that sickos have done to animals, young children
and elderly Americans. The goal is not to entertain you. Rather, I
hope to spark a discussion about the moral collapse of America. The
United States has become a nation of perverts, sickos and psychopaths, and we
need to ask ourselves some very honest questions about why this is
happening. No matter what other solutions we may come up with politically
and economically, this country is not going to have any kind of a future unless
we are able to address the moral decay that is rotting the foundations of this
nation at an absolutely astounding pace. (Read More.....)
I
am no constitutional scholar, but... Posted by :
hedgeless_horseman Post date:
09/16/2013 - ...the right of the people to keep and
bear Arms, shall not be infringed. ...except in New York, Washington, D.C.,
Chicago, Colorado, California, etc.?
Mega
Putin Rich Posted by:
Pivotfarm Post date:
09/16/2013 - If Vladimir Putin and Barack Obama can
get through their tiff over Bachar al-Assad and stop pulling the
covers to their own side of the geopolitical bed, then the Russian leader may
just up...
The
number whispered on Wall Street is $10 billion (or
$14-$15 if you ask The Saudis), but potential investors in the micro-blogger’s
IPO will need more to go on than simple valuation math and guided
judgment. As ConvergEx's Nick Colas notes, Tech firms are
particularly dependent on innovation and human capital for their viability. So
while Twitter may come out with a double-digit billion dollar IPO, Colas points
out the most important question – Is it actually worth buying there?
The bottom line to the success of thriving tech companies (historically names
such as Amazon, Google and Apple) is that they consistently and reliably build
products that people want to purchase and use. Colas explores multiple
avenues to determine whether Twitter has the engine to do this, or whether it
could emerge more “Groupon” than “Google” in the public company tech arena –
and the answer lies in how you weigh the pros and cons of our top 10
points related to the social network’s IPO.
Amid
the 100 year anniversary of the creation of the Federal Reserve, it is
absolutely imperative that the American people understand that the Fed
is at the very heart of our economic problems. It is a system of
money that was created by the bankers and that operates for the benefit of the
bankers. The American people like to think that we have a
"democratic system", but there is nothing "democratic"
about the Federal Reserve. Unelected, unaccountable central planners from
a private central bank run our financial system and manage our economy.
There is a reason why financial markets respond with a yawn when Barack Obama
says something about the economy, but they swing wildly whenever Federal
Reserve Chairman Ben Bernanke opens his mouth. The Federal Reserve has
far more power over the U.S. economy than anyone else does by a huge
margin. The Fed is the biggest Ponzi
scheme in the history of the world, and if the American people truly
understood how it really works, they would be screaming for it to be abolished
immediately.The following are 25 fast facts about the
Federal Reserve that everyone should know...
{ I’m about half-way through Dr. Michael
Crichton’s ‘State of Fear’, which deals with exactly that ‘Orwellian’ stratagem
and fraud … Never light reading from the masterful Doctor (though especially
somewhat laborious reading, I ‘forced myself to get through’ his first
offering, viz., ‘Andromeda Strain’ when it first came out… but, he’s worth your
time … ) }
Economic Collapse | It is absolutely imperative that we get the American
people to understand that the Fed is at the very heart of our economic
problems.
Like
many Americans since the recession hit, you have likely wondered if relocating
to another state would be a good financial move. In this expansive interactive
infographic below, we compare just how well each state is fairing in these
challenging times. How does your state rank?
The graphic is interactive -
choose from across the top indicators of health, and select individual states
for more details...
Over the past few days, there has
been a tremendous wave of optimism that it may be possible for war with Syria
to be averted. Unfortunately, it appears that a diplomatic solution to
the crisis in Syria is extremely unlikely. Assad is certainly willing to
give up his chemical weapons, but he wants the U.S. to accept a bunch of
concessions that it will never agree to. And it certainly sounds like the
Obama administration has already decided that “diplomacy” is going to fail, and
they continue to position military assets for the upcoming conflict with
Syria. Meanwhile, Saudi Arabia, Qatar and Turkey are all going to
continue to heavily pressure the Obama administration. They have invested
a huge amount of time and resources into the conflict in Syria, and they
desperately want the U.S. military to intervene. Fortunately,
overwhelming domestic and global opposition to an attack on Syria has slowed
down the march toward war for the moment, but unfortunately that probably will
not be enough to stop it completely. The following are ten reasons why
war is almost certainly coming… (Read More.....)