Initial Jobless Claims Soar Past Expectations, Hit 380K, Highest Since January
So much for the endless string of "Jobless Claims in US fall to lowest since 2008" propaganda. First of all, just as we predict every week with 100% accuracy, last week's "decline"
from a revised 363K to 357K was revised, and instead it surged from
357K to a revised 367K. So much for the spin. More importantly, the
current weekly claims number exploded to 380K, on expectations of 355K - the highest print since January, and the biggest claim miss in a year!
And also just as predicted, the "economic weakness" period to butter up
the country for the NEW QE begins. Don't be surprised as claims surge
to close to 400K in the next few weeks in advance of an epic BLS miss
next month, all to be blamed on the "warm weather", "Chinese new year",
"Sumatra earthquake" and "Bush" of course, it never happens just because, in time for the FOMC's June meeting to set the stage for MBS LSAP, just as Bill Gross has been expecting all along. IMF: Gold Is Scarce “Safe Asset” And “Growing Shortage of Safe Assets”
Further confirmation of gold’s continuing but gradual renaissance as a safe haven asset was given by the IMF yesterday who warned that a “growing shortage of safe assets” poses a threat to “global financial stability.” The IMF identified $74.4 trillion of potentially safe assets today, including gold, investment grade government and corporate debt, and covered bonds. Sovereign debt crises are reducing the number of governments that investors trust to issue "risk-free" bonds just as new financial regulations are increasing demand for safe securities from banks. Importantly, the IMF’s latest Global Financial Stability Report’s introduction finds that "In the future there will be rising demand for safe assets, but fewer of them will be available, increasing the price for safety in global markets.” “Both the lack of political will to reshape fiscal policies at times of rising concern over debt sustainability and an overly rapid reduction of fiscal deficits limit governments’ capacity to produce assets with low credit risk.” The IMF has warned regarding illiquidity in “safe haven” markets. Gold remains one of the most liquid markets in the world and the illiquidity in bond markets would see increased safe haven demand for gold. The IMF is warning regarding deteriorating public finances. As many governments see themselves being downgraded - safe haven bonds may become less safe.Today’s Items:
According to Graham Summers, Chief Market
Strategist at Phoenix Capital Research, Europe will Collapse completely
in the May-June period. Even though the rollercoaster schemes that are
keeping the European economy afloat are becoming ridiculous, this is a
very tight time-frame when one considers the manipulated data that is
out there.
Next…
324 Years Of The Gold-To-Silver Ratio
http://seekingalpha.com
https://www.jlab.org/
http://www.youtube.com
324 Years Of The Gold-To-Silver Ratio
http://seekingalpha.com
https://www.jlab.org/
http://www.youtube.com
Since 1687, the gold-to-silver ratio has
ranged from 14.14 to 99.76; however, it is interesting that for more
than half of that 324 years, the ratio was less than 20. According to
Jefferson Lab, silver is almost 18.75 times more abundant than gold
within the Earth’s crust. With the manipulated Silver to Gold ratio
above 50, another reason to keep stacking with silver. With that, keep
in mind of the growing counterfeit silver coins out there.
The wealthy are not going to allow the
government they support with campaign money to take their gold. In
fact, most rich people do not have 401-K’s or IRA’s. With this in mind,
the obvious government target for emergency revenue will be those paper
promises.
Will Ron Paul endorse Romney or sit out
the fall campaign and general election? Hopefully neither. Of course,
if Ron Paul does run as a third party candidate, because of manipulated
Republican dealings, you can expect the voting machines to mysteriously
turn your vote for Ron Paul for a Romney vote.
Over 82% of Americans own cell phones,
with around half of these being smart phones. With the new Broadcom
microchip, the location of those smartphones can now be determined to
within a few centimeters. Makes one long for the days of two paper cups
and a string.
The Department of Injustice suing Apple?
Who could not have seen this coming? The lawsuit comes a day after
Apple surpassed $600bn in value, affirming its position as the world’s
most valuable firm. In short, if you are financially successful, you
will be a target.
Let’s face it, it would be nice if
everyone lived on their own acreage with a natural water source;
however, the fact is that most Americans live in cities and when it hits
the fan, it will be more difficult for those in cities. It is
important to define a strategy, make connections, get your gear in
order, and to think positively as you are shooting at those food
starved zombies at your door.
1. Food expires
2. People grow.. Especially kids.
3. Medications and vitamins expire.
4. You learn something new.
5. You may have already used it. Can’t reuse toilet paper.
2. People grow.. Especially kids.
3. Medications and vitamins expire.
4. You learn something new.
5. You may have already used it. Can’t reuse toilet paper.
The Boom & Bust Cycle
Admin at Jim Rogers Blog - 2 minutes ago
A view on the business cycle, Wall Street and Agriculture.
*Jim Rogers is an author, financial commentator and successful
international investor. He has been frequently featured in Time, The New
York Times, Barron’s, Forbes, Fortune, The Wall Street Journal, The
Financial Times and is a regular guest on Bloomberg and CNBC.*
Video Interview, RT.com
Admin at Marc Faber Blog - 22 minutes ago
Latest video interview, RT.com
*Marc Faber is an international investor known for his uncanny predictions
of the stock market and futures markets around the world.*
The Formula Depicts Sluggish Economic Recovery
Eric De Groot at Eric De Groot - 38 minutes ago
The shallow, counter trend rally in US Federal Budget as % of GDP (or formula) depicts a sluggish, liquidity-driven economic recovery since 2010. A similar rally occurred from 2004 to 2007. A downside break of the consolidation pattern in 20013-2014 will likely anticipate the next global crisis event. Chart: US Federal Budget (Surplus or Deficit As A % of GDP, 12 Month Moving Average) and... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
Presenting Economic Reality
Following
today's disappointing jobs data, we thought it useful to reflect on
the sad reality that is occurring under the eyes of AAPL
Mr. Market. As BofAML notes this morning, their Economic Data
Diffusion index (which tracks macro data surprises) has been trending
lower for over a month (indicating a trend of data missing expectations
to the downside) and, more importantly has turned absolutely negative
(indicating a marginally negative bias to the overall economic data
expectations). Following our lead, they note the weather's impact and that this is likely
to be the third time in this recovery that the markets and economic
consensus has over-reacted to positive news and become too optimistic
about growth. Looking ahead, we expect this data downshift to
continue. In the near term, both higher gasoline prices and the fading
weather effect will likely weigh on growth and, over the course of the
second half, we expect the looming fiscal cliff to undercut confidence
and growth. Party's ending, a tough economic reality is looming and the
punchbowl remains out of sight for now.Big Oops: "The Aggregate Shortfall Of Required Stable Funding Is €2.78 Trillion"
For today's dose of sobering cold water we go to the Bank of International Settlements, best known for being the FX bid (and gold offer) of last resort, whose Quantitative impact study results published by the Basel Committee has some very bad news for long-term bank viability: "The Committee also assessed the estimated impact of the liquidity standards. Assuming banks were to make no changes to their liquidity risk profile or funding structure, as of June 2011, the weighted average Liquidity Coverage Ratio (LCR) for Group 1 banks would have been 90% while the weighted average LCR for Group 2 banks was 83%. The aggregate LCR shortfall is €1.76 trillion which represents approximately 3% of the €58.5 trillion total assets of the aggregate sample. The weighted average Net Stable Funding Ratio (NSFR) is 94% for both Group 1 and Group 2 banks. The aggregate shortfall of required stable funding is €2.78 trillion." You read that right: as of June 30, banks lacked €1.76 trillion in liquid assets, and needed €2.78 trillion to meet stable funding rules. And then Europe imploded.Poor Cheshire Is Off His Tea
The Wizard predicts it will be Greece, Portugal and Ireland all back at the trough in 2012 and Spain lining up for its first feeding. Italy remains a question mark but with a real debt to GDP ratio of 200% the structural issues will not be overcome by anything that Mr. Monti has proposed to date. As we all focus on the sovereigns in the last few days I point out that the European banks are down around 2%-4.5% in Germany, Italy and Spain today while the largest bank in Portugal has seen its share price drop 15% this morning. You may ignore the ugliness and the markets may ignore it for this or that day but the European ugliness is not going away and I would be a seller on any pop in equities or risk assets because the European landscape is a quite Bleak House.Daily US Opening News And Market Re-Cap: April 12
Heading into the US open, European stock markets are experiencing a mixed session with particular underperformance noted once again in the peripheral IBEX and FTSE MIB indices. The Portuguese banking sector specifically is taking heavy hits following overnight news from Banco Espirito di Santo that they are to issue a large quantity of new shares, prompting fears that further banks may have to recapitalize. The financials sector is also being weighed upon by a downbeat research note published by a major Japanese bank on the Spanish banking sector. Elsewhere, the Italian BTP auction was released in a fragmented fashion showing softer bid/covers and the highest yield since mid-January in the only on-the-run line sold today. Similarly to yesterday’s auction, the sale was not quite as poor as some as feared. Italy sold to the top of the range and as such, the Italian/German 10-yr yield spread is now tighter by 13BPS, currently at 361BPS. From the UK, the DMO sold 20-year gilts with a lower bid/cover ratio and a large yield tail, prompting gilt futures to fall by around 10 ticks after the release. Later in the session, participants will be looking out for US PPI data and the weekly jobless numbers.Dudley Joins Yellen In Leaving QE Door Wide Open
Last night it was uber-dove Janet Yellen, today it is uberer-dove, former Goldmanite (what is it about Goldman central bankers and easing: Dudley unleashing QE2 in 2010, Draghi unleashing QE LTRO in Europe?) Bill Dudley joining the fray and saying QE is pretty much on the table. Of course, the only one that matters is Benny, and he will complete the doves on parade tomorrow, when he shows that all the hawkish rhetoric recently has been for naught. Cutting straight to the chase from just released Dudley comments:"we cannot lose sight of the fact that the economy still faces significant headwinds and that there are some meaningful downside risks... To sum up, the incoming data on the U.S. economy has been a bit more upbeat of late, suggesting that the recovery may be getting better established. But, while these developments are certainly encouraging, it is far too soon to conclude that we are out of the woods in terms of generating a strong, sustainable recovery. On the inflation front, the year-over-year rate of consumer price inflation has slowed in recent months, and despite the recent rise of gasoline prices, we expect inflation to moderate further in 2012." Translate: NEW QE is but a CTRL-P keystroke away now that all the inflation the Fed usually ignores continues to be ignored.Frontrunning: April 12
- Fed's No. 2 Strongly Backs Low-Rate Policy (Hilsenrath)
- World Bank Cuts China 2012 Growth Outlook on Exports (Bloomberg)
- BlackRock's Street Shortcut: Big Banks Would Be Bypassed With Bond Platform; 'Not Going to Cannibalize' (WSJ)
- George Soros - Europe’s Future is Not Up to The Bundesbank (FT)
- Fed May Have Aggravated Income Inequality, El-Erian Says(Bloomberg)
- Shirakawa Pledges Japan Easing Amid Political Pressure (Bloomberg)
- Spain’s Debt Struggle Opens Door to Sarkozy Campaign Message (Bloomberg)
- Iran Woos Oil Buyers With Easy Credit (FT)
- Syria Pledges to Observe Ceasefire (FT)
How Much LTRO Dry Powder Is There, And Why Spain Is Again The Wildcard
Now that every morning the US market is once again in full on European debt issuance stress mode, it makes sense to see just when the real stress will hit the tape, or in other words, how long until the LTRO money fully runs out. Remember that the latest contraption in the European ponzi, the LTRO, took worthless collateral from European banks, and flooded them with fresh money good cash so they could use this cash to buy their own sovereign debt, and specifically to prefund the hundreds of billions in 2012 issuance net of debt maturities. So how does the math work out? Deutsche Bank summarizes the unpleasant picture.Italy Sells €4.884 Billion In Bonds, Just Shy Of High Target As Yields Climb
All eyes were on Europe again today, where Italy sold debt for the second day in a row, only this time instead of 1 year and lower Bills, the Tesoro came to market with On and Off the run issuance maturing in 3 through 11 years. And as was to be expected, with a substantial portion of the debt maturing after the LTRO 3 year window, the auction was mixed, far weaker than yesterday's LTRO-covered Bill issuance, and the maximum target of €5 billion was not met, instead a total of €4.884 billion was sold. Furthermore yields surged compared to previous auctions. "The funding environment is getting tougher for the periphery. Overall we believe the spreads are biased towards further widening although we still prefer Italian debt over Spanish," said Michael Leister, a strategist at DZ Bank.What is most worrying is that the funding picture is again deteriorating rapidly, although not as fast as in Spain, even as LTRO cash is still sloshing around European banks. What happens when it runs out?March Foreclosure Activity Plunges To 5 Year Low
While the naive public has been inundated with stories that the foreclosure pipeline has been finally unclogged following the robo-settlement (see here and here) and as a result the home "price discovery" process is well on its way, reality is just a tad different. Make that totally different. As usual, the only foreclosure report that matters, and that is even remotely close to reality, comes from RealtyTrac, and we are sad to say, it brings no good news. Quite the contrary. According to the real estate specialists, March 2012 foreclosures plunged from 206,900 in February to 198,853 in March, the first time the total number of foreclosures (either Default Notices, Foreclosure Auctions, or REOs) has dropped under 200,000 since July 2007! Which sadly means that the foreclosure dam wall has yet to crack. Of course, when it does, well "The Second Foreclosure Tsunami Is Coming, And Is About To Kill Any Hopes Of A "Housing Bottom."
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