Larry Summers: "Welcome To The Non-Recovery" Or "Fiscal Stimulus Or (Another US) Bust" 

Submitted by Tyler Durden on 06/12/2011 18:00 -0400

Just under a year ago, we got the tax fraud, and the only remaining member of Obama's economic Titanic, praising the US recovery. His timing top ticked the economy, preceded the Hindenburg Omen by 10 days, and ushered in QE2. Now, we get his sidekick, long since departed after totally failing (we use the more polite F-form of the word) up at his job, writing the follow up, from the cushy confines of academia, warning America that unless there is a major fiscal stimulus (because presumably the monetary stimulus which everyone praised in the form of QE2 has now been proven to only be a boost to the stock market and a bailout of European banks), this once great country which once exhibited the world's reserve currency is on its way to another "lost decade." We wish Summers well: perhaps 3 of those who read the following drivel will take him seriously. Two of them are Krugman and Koo. We are taking bets as to who the third one will be...

As Jim O'Neill's Koolaid Dispenser Runs Out, The Goldman Sachs Asset Management Head Sees QE3 

Submitted by Tyler Durden on 06/12/2011 14:50 -0400
Sometimes observing the counterclockwise rotation on Jim O'Neill's Koolaid-O-Dispener knob from 10 to 1.5 is the most gratifying thing that can happen to a person. Which is precisely what the most recent weekly report by the man who was sanctimoniously relegated to managing Goldman's most unprofitable division, GSAM, present: a bleak world in which the perpetual twisting of reality by the Man Utd fan has lost all credibility. To wit: "On Thursday lunch time, I joined some Goldman Sachs colleagues for a lunch with some leading macro hedge fund investors, most of which I had enjoyed a similar lunch with last October. The mood this time couldn't be more different. I guess it is kind of understandable given the recent run of data, the markets and the apparent policy impasse in DC on fiscal matters. But it seemed to me it was all a bit over the top. The general mood around that lunch table was gloomy, whether it was about the US, Europe or China, both with respect to data and policy options. I was regarded as a raving lunatic for suggesting it was possible that US unemployment might fall below 6 pct by the end of 2013." Hmm, whoever could possibly conceive of the man whose predictive track record is only better to DB's Joe Lavorgna, as a raving lunatic. Anyway, more importantly, even O'Neill is now forced to admit that in the off case that he has OD'ed on the Keynesian-spiked red substance, that the Fed will have no choice but to launch into another round of easing, something which is pretty much a given for everyone else, and would indicate that the US economic depression, which started almost 4 years ago never ended, but was briefly interrupted by bear market rallies inspired by dollar dilution: "while a QE3 would clearly involve “externalities,” it seems obvious to me that if the recent weak US data is for real, then there is a good chance that the Fed would deliver on something more." Naturally O'Neill then goes on to explain why even a negative GDP print which may be in the cards for Q3 is absolutely nothing to worry about. Lastly, there is always next year's Champions' League for Manchester United...

Goldman Goes Short Nat Gas 

Submitted by Tyler Durden on 06/12/2011 20:12 -0400
Last week we had the advance stop order shake out warning courtesy of berserk inverted fractal HFT algos which were completely not accidental. Now we get the real thing. Just out from Goldman's Samantha Dart: "NYMEX natural gas prices have rallied 12% in the past three weeks, largely driven by strong cooling-related demand for natural gas on the back of significantly warmer-than-average temperatures, and exacerbated by the still high nuclear outages. However, these factors are transient in nature, and their support to generation demand for natural gas will likely diminish in the coming weeks as the weather normalizes and nuclear power plants come out of maintenance...However, even after taking these transient issues into account, the supply and demand balance for gas was surprisingly resilient in May, especially given the continued impressive gains in shale gas production. We believe the production growth has been largely accommodated by additional strength in generation demand resulting from a wide discount of US natural gas prices relative to coal generation costs, as well as by higher pipeline exports out of the United States. We view the current high prices as unsustainable. In addition to the transient nature of the demand support from weather and nuclear outages, we expect the underlying balance to soften in response to the higher  prices, as production growth is further incentivized and price-induced coal-to-gas substitution diminishes. Accordingly, we recommend going short the October 2011 NYMEX Natural Gas contract, at an initial price of $4.84/mmBtu." Translation: Goldman is now buying nat gas.

Stormy Skies for Canada's Middle Class

..."This attitude must change – for everyone’s benefit. The squeezing out of Canada’s middle class has major implications for our collective prosperity. Middle-class incomes drive economic growth, pay for public services, support healthy families, and build communities. Society cannot subsist on crumbs left over by the rich. Workers cannot accept the logic that relentless cuts and constant sacrifice will bring better days ahead..."

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NASA recently participated in a FEMA exercise called Eagle Horizon

NASA Internal memo: Family/Personal Preparedness Plan  
A major initiative has been placed on Family/Personal Preparedness for all NASA personnel. The NASA/Family Preparedness Program is designed to provide awareness, resources, and tools to the NASA Family (civil servants and contractors) to prepare for an emergency situation. The most important assets in the successful completion of NASA’s mission are our employees’ and their families. We are taking the steps to prepare our workforce, but it is your personal obligation to prepare yourself and your families for emergencies.








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