Thursday, November 17, 2011

Mike Krieger Exposes The Three Card Monti

Just like the con (confidence) game Three Card Monte through which people have been swindled out of their hard earned money in alleyways and street corners all over the world for half a millennium, the previously sovereign nations of Greece and Italy have now officially been placed into the receivership of “technocratic governments” and are now in the final phase of their looting. It truly is sad to watch these proud nations whose histories form the very core of Western civilization be taken down one by one but what is even more nauseating is watching the corporate media pundits, Wall Street analysts and financial experts cheer the news because it is ostensibly “good for markets.” First of all, it doesn’t take a genius to see that the people that screw up the most get promoted and advanced in the Western world’s current political/economic structure. The primary reason for this is that there is a very serious agenda of TPTB and that consists on using crisis to consolidate power in a one-world government, headed by a global central bank that issues a global fiat currency. People have been saying this on the fringe for decades and have been called conspiracy theorists the whole time but if you look at how things are progressing today you’d have to be asleep to not notice that the guys in charge are completely and totally determined to bring this sick, twisted dream into place. That is why the agenda moves forward despite the repeated, desperate cries of the citizenry for them to stop. Let’s take a look at Mario Monti, the “soft” dictator that has been thrust upon the people of Italy by TPTB. He is a member of the Bilderberg Group, he is the European Chairman of the Trilateral Commission (a think tank founded by David Rockefeller in 1973, see quote at the top) and is international advisor to none other than Goldman Sachs. This guy was put into place by design. Anyone in Italy that thinks they achieved a victory in by ridding themselves of Berlusconi you better think again. You just got the biggest insider, crony financial terrorist around put in charge of your country without having a say in it. Even for someone like me that expects these things, I am amazed by how badly Italy was just screwed.

Payback Time - The Coming Decade Of Deleveraging

Having gorged on the fat pipe of cheap credit for much of the previous few decades, the last few years have rapidly and aggressively slapped the US (and indeed much of the world) from its stupor. All that growth, was it real? The speed of economic leveraging began to gain momentum in the early 1970s and accelerated sharply in the 1980s as the cost of debt began its decades-long decline. That leverage enabled consumption and capex to rise quicker and with less capital but obviously with more risk. With the current balance-sheet recession stymieing monetary policy and fiscal policy hardly supportive, it seems the private deleveraging hole will be difficult to fill with public borrowing excess. It seems that credit markets (the ubiquitous source of all that leverage) have again and again sung from a different song-sheet with regard to the way we escape from the inevitable deleveraging we are currently undertaking. Matt King, of Citigroup, provides a thought-provoking (and all-encompassing) slide-deck on the coming decade of deleveraging and how now is time for payback discussing the bubble in credit, ways of deleveraging, and investment implications.

European bonds rise in yield/another gold and silver raid

Good evening Ladies and Gentlemen: The world today experienced a frozen liquidity squeeze as bankers refuse to loan any money to other bankers. The USA provided emergency swap relief as the global meltdown continues.  The bankers are now trying desperately to obtain whatever physical they can and thus they raid the paper comex.  The price of gold fell by 53.20 dollars to $1720.60  Silver also

The New Retirement Normal: The Average American Must Work For Two Extra Years After Death

While Italy is bickering over just how inhumane it is to raise the retirement age by 2 years in a 15 year span (which works out to a whopping 48 days per year) and will likely lead to mass riots and bloodshed in Rome before the idea is ultimately scrapped, things in America's own back yard, the country that now that the EFSF is finished will have no choice but to come to Europe's rescue via the IMF, are looking horrendous to quite horrendous. In fact when it comes to retirement, 80 is, we are sad to say, the new 65, at least according to Wells Fargo. And with average life expectancy in the US peaking at 78.1, it means that the typical American will have to work for an additional 2 years after death to pay for not only not having any retirement savings (thank you Bernanke ZIRP and VIX>30 stock market), but to make sure Europeans have theirs. You think we jest?

Risk-Assets Collapse As Knife-Catchers Are Nowhere To Be Found

Unlike yesterday's close, which was led by stocks and not sustained by broad risk assets, today's notable dive in ES was fully backed and supported by credit, commodity, FX carry, rates, and spreads. Volumes dried up as the afternoon progressed as we suspect machines were turned off on the vol regime shifts and real 'value-investing' money was patently absent - now Bill Miller has left the building. HYG underperformed and was first to move as we sold off just after lunch (on what we suspect was driven by the transparency of the USD funding difficulties we discussed). Liquidations, thanks to CME margin moves, did not help and dragged commodities hugely lower - even as the dollar (and EUR) ended almost unchanged from yesterday's afternoon close. The clarion call for the ECB's bazooka will be loud this evening.

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RANsquawk Market Wrap Up - Stocks, Bonds, FX etc. – 17/11/11


New York Fed Swap Lines With Europe Increase By $390MM, Rise To $2.248BN

The New York Fed has released its updated FX swap line data: while the USD line with the BOJ has been cut from $102 million to just $1 million, what is more disturbing is that the swap lines with the ECB increased by $390 million to $2.248 billion. This amount is split between $500 million in a 7 day line at 1.08% and the balance locked up in a 84 day swap at 1.09%, which is where the addition was found. And now we start getting the denials from European banks as to who it may have been to need rescue funding from the Fed via the ECB, and was unable to access USD Libor at a far lower rate.

Sorry Europe: China's Pockets Are...Empty

As every central banker, politician (except Chuck Schumer), and bank CEO looks towards Chinese central planners as their apparent bottomless pit of dumb money, it seems that perhaps the cupboards are bare. Reuters, via The China Post, highlights in a recent article that while there are indeed reserves, they are gainfully employed and the unwinding of those positions (in size enough to matter) to provide the cash that is so desperately needed to keep the ponzi going, will itself cause a vicious circle of negative sentiment. In fact, analysts reckon China's armory has only about US$100 billion to spare.


Watch Nigel Farage Dance On The Euro's Grave

Nigel Farage needs no introduction: the famous Euroskeptic is one of very few men who has had the temerity to question, often in an abnormally high decibel fashion, the stupidity of the Eurozone leaders from day one. Now that he has been proven correct, he has every right to gloat, which he does to everyone's delightful amusement in the European parliament. The look on the unelected von Rompuy's face, especially as he watches his decade-long bureaucratic nirvana crash and burn every single day, is quite priceless.

US Celebrates $15 Trillion In Debt By Announcing Latest $99 Billion Forward Issuance Calendar

Barely has America had the pleasure of enjoying its new found status as a 15-handle country (as in $15 trillion, or $15,033,607,255,920 to be specific) that the US Treasury went ahead and announced its latest forward issuance calendar of $99 billion in bonds and $11 billion in TIPS. Sure enough, by the end of next week, total US debt will be greater by $62 billion including a Bills auction, bringing the revised total to just under $15.1 trillion, and less than a $100 billion from the re-re-revised debt ceiling, even as the Supercommittee is deadlocked beyond fixing. Also, this means that even assuming the Q3 GDP is not revised lower, total debt-to-GDP will almost certainly surpass 100% by the end of the calendar year since December will have at least another $100 billion in issuance net of redemptions.

"The Entire System Has Been Utterly Destroyed By The MF Global Collapse" - Presenting The First MF Global Casualty

Barack Obama Bond Cronyism MF Global Reality It is with regret and unflinching moral certainty that I announce that Barnhardt Capital Management has ceased operations. After six years of operating as an independent introducing brokerage, and eight years of employment as a broker before that, I found myself, this morning, for the first time since I was 20 years old, watching the futures and options markets open not as a participant, but as a mere spectator. The reason for my decision to pull the plug was excruciatingly simple: I could no longer tell my clients that their monies and positions were safe in the futures and options markets – because they are not. And this goes not just for my clients, but for every futures and options account in the United States. The entire system has been utterly destroyed by the MF Global collapse. Given this sad reality, I could not in good conscience take one more step as a commodity broker, soliciting trades that I knew were unsafe or holding funds that I knew to be in jeopardy... The futures and options markets are no longer viable. It is my recommendation that ALL customers withdraw from all of the markets as soon as possible so that they have the best chance of protecting themselves and their equity. The system is no longer functioning with integrity and is suicidally risk-laden. The rule of law is non-existent, instead replaced with godless, criminal political cronyism... Finally, I will not, under any circumstance, consider reforming and re-opening Barnhardt Capital Management, or any other iteration of a brokerage business, until Barack Obama has been removed from office AND the government of the United States has been sufficiently reformed and repopulated so as to engender my total and complete confidence in the government, its adherence to and enforcement of the rule of law, and in its competent and just regulatory oversight of any commodities markets that may reform. So long as the government remains criminal, it would serve no purpose whatsoever to attempt to rebuild the futures industry or my firm, because in a lawless environment, the same thievery and fraud would simply happen again, and the criminals would go unpunished, sheltered by the criminal oligarchy.

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