Historic event as gold surges while stock markets tumble, Turk tells King World News

 

Shadow ECB Council Pushes For Rate Cut And Monetary Easing

According to the Handelsblatt, while the majority of the members of the ECB's shadow council - an unofficial panel, independent of the ECB/Eurosystem, and comprising fifteen prominent European economists drawn from academia, financial institutions, consultancies, companies and research institute - supported an unchanged policy the bias is increasingly shifting to one of easing. This comes on the heels of Trichet's idiotic decision, just like in 2008, to start hiking rates in several months ago (ridiculed extensively on these pages and elsewhere) which not only ended up costing Europe its common currency much faster than had it merely kicked the can down the road, but could very well be the last bad decision by the ECB: should Greece be kicked out of the Eurozone as a result of this decision, the ECB is over. It is therefore not surprising that not only is the shadow council scrambling to undo 5 months of bad decision making by the ECB, but the bankers on the council, particularly RBS, PIMCO, RBS (RIP by the way), Barclays and Tudor and HSBC are either expressing an easing bias or outright pushing for a 50 bps cut. Alas, this is too little too late. And the irony is that once the Fed proceeds with QE3, and commodities surge again, the ECB will really be helpless as the continent's core redlines even as the Periphery remains terminally insolvent (ignoring for a minute the inflationary elephant in the room that is China). So will Trichet disgrace his already discredited central banker career by pushing a rate cut before he is swept out of the corner office by Mario Draghi, or will the former Goldmanite Italian become the most hated man in Germany soon, after he proceeds to ease, even as Germany still experiences Chinese inflationary re-exports. The answer will be all too clear in just a few months.

 

ES Closed As Gold Continues Trading, Passes $1900

All stock jockeys can now step away from the terminal: both Europe and ES are now closed until late this afternoon which means the E-Trade momentum chasing baby will have to suffer its losses for at least 6 hours in complete collateral call misery. In the meantime, however, gold continues to trade for a little longer, and at last check the spam nemesis was trading over $1900 once again and just one less well known dead president away from its all time highs. We expect the record to be taken out possibly as early as this evening.





If anyone located in Belarus or any other Country experiencing food riots, high inflation or Hyperinflation, and would like to write about it, please email it to wethesheeplez@yahoo.com and I will post it here. 

Thank You 

Guest Post: This Is Why We Internationalize. This Is Why We Have A Plan

Welcome to the new reality. Executive agencies in the United States have extraordinary unchecked power. They can seize your assets, freeze your bank accounts, intercept your emails, comb through your credit card transactions, and even take away your children… all without so much as a court order or any form of oversight. We’ve explored before how you can end up on the wrong side of a government agency, even if you haven’t done anything illegal. If you are so much as suspected of wrongdoing, they can come after you… even if you’re just in the wrong place at the wrong time, they can come after you. These are two cases where the government has come after its citizens– even when they are doing the RIGHT thing. Think about it: two of the most unlikely people in the country have become enemies of the state: an eleven-year-old girl who wants to save a baby bird, and a manufacturing company that has managed to stay in business (and continue hiring!) in the midst of the worst recession in the nation’s history. This is why we internationalize. This is why we have a plan.

Charting The Global Perfect Storm And SocGen's Economic "Stall Speed" Matrix

Zero Hedge first mentioned the phrase "stall speed" while discussing the Q1 US GDP, which we predicted would translate into a disappointing print for Q2, eventually leading to a negative number in Q4. This was about 4 months ago. Since then our GDP prediction has been validated, but we had yet had to see "stalling" make the vernacular. That has now changed, following the release of a brand news report by SocGen which focuses on the phenomenon of... global stall speed and how specifically this is affecting the key investment verticals around the world as well as what the possible policy responses are. But perhaps more interesting is SocGen's succinct explanation of how the world now finds itself in a global perfect storm, and whose ending will likely be very much comparable to that of the eponymous movie starring George Clooney.

Tremonti Unexpectedly Cancels Public Appearance, Returns To Rome

Just a headline from Bloomberg for now:

• ITALY'S TREMONTI CANCELS SPEAKING APPEARANCE IN PIACENZA
• TREMONTI CANCELS APPEARANCE TO RETURN TO ROME TO GO TO SENATE

Will Tremonti finally resign and tell his idiot of a boss to shove it? Or will he declare the truth about Italy's toxic death spiral. Either way, the market can not wait to find out. More as we see it.

Italy To Miss GDP Forecast, Sees Sub 1% GDP Growth

It is only a matter of time before France announces to little fanfare that its GDP is about to be slashed, and that as a result the rating agencies put it on downgrade review, and blowing up the entire EFSF mechanism. But before that one needs to shake out the weaker hands, like Italy. For better or worse, that just happened. From Reuters: "Italian economic growth is likely to fall short of the government's official forecast of 1.1 percent in 2011 and 1.3 percent in 2012, probably coming in under 1 percent, a senior government source said on Monday. "It will be very difficult for Italy to reach 1.1 percent growth this year and next," the official, who spoke on condition of anonymity, told Reuters." So if the raters needed any excuse to go ahead and downgrade Italy even more, this is it. As for France: we give them a few months before they also have to tell the truth, and face the music, although with French CDS once again trading at all time wides, the market is not waiting.





Investor Sentiment: The Line in the Sand

Posted by : thetechnicaltake

Post date: 09/05/2011 - 10:50

The two week bounce has served one purpose, and that is put a floor or “line in the sand” under this market.

Corruption of India's Economic Miracle?

Monday, September 05, 2011 – by Staff Report

Anna Hazare
India Says No to $80 Toilet Paper ... An anticorruption campaign has given voice to a growing middle class tired of public indignities ... A year ago, no one in India could have imagined that cabinet ministers, powerful politicians, senior officials and CEOs would be in jail now, awaiting trial for corruption. The credit for this dramatic shift belongs in no small part to the anticorruption movement of a 74-year-old activist, Anna Hazare, supported by determined justices of the Supreme Court, an exceptional auditor general, rival television channels in search of "breaking news" and, crucially, a newly assertive Indian middle class. The long-term impact of this movement is unclear. It could lead to something profoundly good, or it could destabilize the whole system. – Wall Street Journal
Dominant Social Theme: If India could only remove the corruption plaguing its government, prosperity might come to all ...
Free-Market Analysis: More and more is being written about the anti-Indian corruption movement, which is led in part by Anna Hazare (see above article excerpt). We've commented on this movement in the past, which is gathering momentum in India and may in fact partake of the austerity meme sweeping Europe and America. You can see the original article here: Government Anti-Corruption Meme.
The original article focused on another austerity and anti-corruption campaigner, Swami Baba Ramdev. Baba Ramdev has insisted that India's large denomination bills – Rs.500 and Rs.1000 – should be withdrawn from the entire country in order to lessen financial fraud.
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DB Briefs: German Court Set to Trip Up EU? / China's Leaders Attempt to Gag Internet, but Problems Are Fundamental/ Atlantic Questions Work Habits of US Leaders

Monday, September 05, 2011 – by Staff Report

German Court Set to Trip Up EU? ... German court to insist on bail-out reforms ... The German Constitutional Court is set to demand that the German government does more to ensure "democratic legitimacy" for its support for European wide bail-outs in its long-awaited judgment on the legality of the multi-million bail-out of debtor nations. Chancellor Angela Merkel has faced criticism for not seeking fresh democratic mandates for the millions of euros the German government has provided in support for the eurozone's struggling nations such as Greece and Ireland. – UK Telegraph

China's Leaders Attempt to Gag Internet, but Problems Are Fundamental … China state paper urges Internet rethink to gag foes ... China's Communist Party control is at risk unless the government takes firmer steps to stop Internet opinion being shaped by increasingly organized political foes, a team of party writers warned in a commentary published on Friday. The long commentary in the overseas edition of the People's Daily, the main newspaper of China's ruling Communist Party, added to signs that Beijing, jolted by the growing audience and influence of Twitter-like microblogging websites, is weighing fresh ways to tame and channel online opinion. Chinese officials and media have recently complained about the spread of damaging and unfounded "rumors" on the Internet. – Reuters

Atlantic Questions Work Habits of US Leaders … In Praise of Senior U.S. Officials Taking the Weekend Off ... Secretary of Defense Leon Panetta's absences call into question management practices and a culture of workaholism ... The LA Times ran an anonymously sourced piece on new Secretary of Defense Leon Panetta: Aides say that unless he is required to stay in Washington or travel elsewhere, Panetta will spend most weekends and days off at his 12-acre walnut farm in scenic Carmel Valley, where he and his wife, Sylvia, make their home... But his absences at the Pentagon have raised eyebrows in workaholic Washington. Even some of Panetta's friends wonder how he can get away so regularly while his department, by far the largest in the U.S. government, faces multiple wars and daily crises. – The Atlantic
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