Monday, August 8, 2011

Selling in Asia Worsens, Korea's KOSPI Index Now Down 7% (click to read)






British riots spread on third night of violence

Eric De Groot at Eric De Groot - 3 hours ago

Maintaining social order will motivate another global QE. Headline: British riots spread on third night of violence LONDON (Reuters) - Riots spread to new areas of London on Monday while looting also erupted in the city of Birmingham as Britain's worst unrest in decades escalated in a third night of violence. British Prime Minister David Cameron cut short his holiday to fly home to... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] 





China CPI Comes Hotter Than Expected At 6.5%: Highest Since June 2008

Following hotter than expected Chinese CPI, futures have taken another major, with ES now down 1.7%, same as the DJIA, and NQ down 1.8%. The reason: Chinese July CPI which came at 6.5%, hotter than the consensus 6.4%, and indicative that contrary to expectations, the politburo is still focusing purely on dealing with Bernanke's exported inflation. It also means that there will be no joy in Mudville and China will not serve as the much needed growth dynamo to push the entire world out of the re-depression. The breakdown in component shows that food inflation jumped 14.8% versus non-food inflation rising 2.9%. Elsewhere PPI came in line with expectations at 7.5%. "China’s rising inflation is likely short lived given falling food prices, especially pork," Bloomberg economist Michael McDonough says. True, however the much needed panacea for the overnight malaise that has gripped the world market is not forthcoming, and the ball is now squarely in the Chairsatan's court.






Harvey Organ, Monday August 8, 2011

Gold skyrockets to record levels/Dow plummets 634.76 points.


Good evening Ladies and Gentlemen: Today was a humdinger of a day. Gold closed the comex session at $1710.00 up  a huge $50.10.  Silver on the other hand rose by only $1.29 as this metal is trying to assert itself as money and not just an industrial commodity. At 5:45 pm here are the following gold and silver prices: gold:  $1717.20 silver:  $39.03 As most of you are aware, the Dow plummeted





Size Seller Of Futures Sends Spot Gold To New All Time High Of $1725


As Asia opens, with both the Nikkei and the Kospi printing well below 4%, a number likely to end far lower, we take a quick look at our own futures, where we notice that following a rather substantial dump which saw nearly 400k ES contracts change handles at around 6:10pm bringing the stack 10 handles lower, ES is now just barely above 1100, or 1105 to be specific at last check. The major positional offload also sent gold surging by over $7 and the shiny metal has just hit another record high in the $1723 ballpark. The overnight session should be relatively quiet aside from a Chinese CPI print which is expected to come at 6.4% but which will be goalseeked to indicate that the economy is slowing down, a move which will probably be attributed to the ongoing "revaluation" of the Yuan, which we expect will again be fixed by the PBoC at a new record high price against the USD shortly. We anticipate quite overnight trading until Europe once again opens, at which point Italy will as usual be the focus of numerous halted stocks if not entire markets.





The Silver Bears Are Back For Part 7

Everyone's favorite cartoon is back after the silver bears make yet another return appearance, this time number 7, in which more than anything, it is made clear that the name of Blythe Masters will live in infamy long after she no longer has anything to do with the price of silver, and, allegedly, its ongoing suppression.






Treasury Adds Another $20 Billion In Debt Overnight, Just $160 Billion Below Revised Ceiling

Ok, someone please explain this one to us because we must be a little slow. Wasn't the whole thing with the debt ceiling hike such that no more Congressional melodramas would have to be inflicted upon the population until after Obama [won|lost] the 2012 elections? Because according to the one again exponentially increasing debt balance of the US Treasury (there is another $51 billion in debt/cash coming in next week), the total US treasury balance (subject to the ceiling) is $14.54 trillion (and $14.58 trillion for total), an increase of $20 billion overnight, the Treasury will hit its latest ceiling no later than the end of September. As the latest DTS statement indicates, the debt ceiling now is $14.694 trillion: a number which Tim Geithner will hit in about a month. So if this is due to a planned expansion as part of the two step plan, we would like to understand how it works, because the $400 billion additional ceiling is barely sufficient to cover the catch up in funding for the SSN and the various governmental trust funds. And the far bigger concern is that tax receipts are about to plunge courtesy of the imminent double dip. So we wonder just based on what assumptions does the Treasury believe that its issuance needs will be met by this paltry debt ceiling.





Tepper Sells His $110 Million Bank Of America Position.... What About His $300 Million Citi Stake?

Following today's apocalyptic trading in Bank of America, David Faber disclosed that one of the biggest cheerleaders of the increasingly doomed bank, David "Balls to the Wall" Tepper, had cut his entire stake in BAC and Wells Fargo (despite presenting the most laudatory powerpoint back at the 2010 Ira Sohn conference which predicted BAC going to $27... no comment). That's great, however, as we disclosed the other stock that is currently causing Paulson to scramble and to extract "value" out of every non MTM 2nd lien currently held by the fund, is none other than Citigroup which tumbled just a little less than BAC, closing down 17%. The issue is that as per the just released Appaloosa 13F, Citi is the top stock held by the hedge fund currently... Although probably not after today. Which is surprising because if Tepper expected Bernanke to announce QE3 tomorrow, he would pull more of his on screen antics and instead of dumping his financial holdings, he would be adding. Then again as the chart below demonstrates, Tepper is a guy who is happy to buy high and sell low, if in the meantime he can take advantage of the Fed's generosity with taxpayer capital to make billions in his Christmas bonus. Anyway, while Tepper may or may not have been skewered on his top position today, below is the complete summary of all position changes between Q1 and Q2.






Guest Post: Coal And Ethanol Are Not Alternative Energy Policy

The domestic alternative energy policy in the US seems to rotate on semantics and adding words to other words to make it look like something is going on. However, the truth of the matter is, energy policy is as defunct as ever and on most fronts the US is lagging far behind. Mostly it is a disregard of what the economist Herman Daly has pointed out about the macro-view of the macro-economic system. His idea is that the ecological system is closed and finite, not infinite created by God for our own personal use, which needs to be included into economic models. As pointed out by this author in, The Need For a Real Domestic Alternative Energy Policy, the US will need this Energy policy to spur growth, create jobs, and remain competitive going forward. Yet, with words out there such as “clean coal” and “corn ethanol” as our savings for the future, it seems that the US gets further and further from the ability to save the economy and closer to suicide.





Senate Probing S&P Downgrade

If anyone thought that the Congressional subpoena of Meredith Whitney was taking it too far, you ain't seen nothing yet. According to flashing headlines, the idiots in the Senate now have S&P firmly set in their sights. Reuters adds that, "the Senate Banking committee has begun probing last week's decision by Standard and Poor's to downgrade the U.S. credit rating, a committee aide told Reuters on Monday. The aide said the panel was gathering information about the S&P move but no decision had been made on whether it will hold hearings into the downgrade. But, the aide added, all options were being weighed." At least this action did not involve the Feds and a SWAT team breaking into the company's headquarters unlike a comparable escalation in Italy. We are currently conducting a Lexis-Nexus search to find when the last time that a rating agency upgrade of a nation resulted in the type of prosecution which the glaringly terrorist and racist S&P (in the US) and S&P and Moody's (in Italy) are subjected to currently. We will be sure to bring you the results as soon as have them. We are confident the search will be very, very fruitful. In the meantime, keep an eye on the FBI's most wanted terrorist list. The face below may soon be staring at you from it. And if not, Deven Sharma should prepare for a lifetime of body cavity searches courtesy of the TSA.





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