Iranian clerics' attempts to curb speculation in the Rial and stabilize the currency appear to have backfired as the un-official (real) Rial rate traded as low as 34,250 Rial to the USD this morning - a massive 20% plunge. Demand for gold is surging (as Tehran exchange volume is up almost 18% today) as the population appears to be readying itself for hyperinflationary death - as we wrote yesterday, it really is no fun in Iran. The following tables/links will allow the real-time monitoring of that market's collapse - since Bloomberg's official rates are entirely useless. Instead of allaying fears about the availability of dollars, the centre seems to have intensified the race for hard currency as "The government's initiative ... brought to the surface a tremendous lack of confidence in its ability to manage the currency,"
by Bill Holter, MilesFranklin.com:
Forbes magazine just came out with an article reporting “Signs of the Gold standard are emerging from Germany.”
Jenns Wedemann, president of the Bundesbank gave a speech last week
warning of the follies of fiat money and the virtues of Gold as a
monetary foundation. That very same day, Deutsche Bank, Germany’s
largest, came out with a paper on the same subject. It is important to
understand the timing and the venue. These were reported on by Forbes, a
mainstream U.S. and global publication, the speech and paper were from
Germany’s largest bank and the central bank. This was not put forth by
some tin foil hat wearing hack like myself, no this was done
“officially” and should be ignored only at your own risk.You must ask yourself “why”. Why has Germany asked for an audit of their Gold held in New York? Why does China continually purchase Gold from the rest of the world while mining new Gold which stays put within their borders? Why has Russia been accumulating Gold. Why are Russia, China, Brazil, India and others even including Mexico doing trade deals that specifically EXCLUDE the use of Dollars for settlement? Why, why, why?
Read more @ MilesFranklin.com
Gold Touches 2012 Highs
Spot Gold just jumped above its February 2012 highs to trade at $1791.45. This is the highest since November 2011 as the precious metals continue to outperform stocks post-QEternity.
Santelli On QEternity: "Deflation Vacation Or Inflation Gestation"
With
gold being horded in Iran and hitting 2012 highs this morning, CNBC's
Rick Santelli addresses the 800lb gorilla in the Fed's room - the threat of inflation. Critically noting that the hyperinflation of Weimar Germany "did not happen overnight"
but was gestated quietly until it was unstoppable by currency
debasement; the question remains of what exactly the Fed thinks it is
doing. Santelli makes the important point that if we look at 'printing
money' as any type of solution then why not take it to the extreme - "if we just print a million dollars for every man, woman and child and handed it to them, wouldn't that fix everything?" As he adds "if it was that easy there would be no need for economist, no need for even CNBC, but it isn't that easy," Reflecting on Evans' earlier inability to quantify any metrics for whether QEternity was working,
Santelli notes that the Fed man falls back to 'confidence' (animal
spirits) but worries that inflation is a lot like soybeans; need sun,
water, and time but eventually will grow rapidly.Venezuela's Hugo Chavez: "I Would Vote For Obama, Because Obama Would Vote For Chavez"
Obama may want to throw this one in the unsolicited communist dictator endorsement pile. From CNN:
"President Barack Obama received one endorsement he definitely did not
ask for Monday: Venezuelan President Hugo Chavez. The leftist leader
and strong man, who has used strong anti-United States language in his
political rallies and official speeches, told state-owned VTV, "In
the point of view of his politics, if I were voting, I would vote for
Obama and I believe that if Obama was from Caracas, he would vote for
Chavez." Whatever one says or thinks about the Caracas head guy who recently is quoted as saying that "perhaps
Mars had life at one time but then evil capitalism showed up and
finished the planet off" (and Mars didn't build that life he forgot to
add) or his foray into US elections, where he now shares the view of
socialist Europe, he sure knows a gold bar in the local safe is worth
two in the LBMA vaults in London.The Fed Chairman "Gets To Work", Releases His First Speech Since QEternity
China PMI still in contraction mode/European PMI also weak/UK PMI plummets/Greek bad loans now reach 25%/
Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 1 hour ago
Good evening Ladies and Gentlemen:
Gold closed:
Comex gold figures for September:
Sept 29-.2012 first figures for October:
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
96.45 (HSBC
Deposits to the Dealer Inventory in oz
1,999.91(Brinks)
Deposits to the
Corn inventory drops to eight-year low; futures prices jump
Eric De Groot at Eric De Groot - 2 hours ago
As long as the invisible hand continues accumulating the decline, I'm a
buyer above 60%. A close above 60% suggests the following is not over:
Drought 2012 Pain at the grocery store Corn bears' hiberation Chart: Corn
(CORN) And Corn Diffusion Index (DI) Headline: Corn inventory drops to
eight-year low; futures prices jump The country's corn, soybean and wheat...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]
Watch The Rich Disappear
Eric De Groot at Eric De Groot - 3 hours ago
Watch the rich disappear as history repeats. The socialistic experiment
may attempt to tax the rich at 75% in France, but wealth, highly flexible
and mobile, is not stupid. Taxing the rich at 100% won’t even put a dent
in the world’s growing debt burden and structural deficits. The rich whom
vote with their feet won’t lie down quietly while their wealth is
reallocated by the...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]
Video: We Are Entering A Correction Phase
Admin at Marc Faber Blog - 4 hours ago
Latest video interview, on Fox Business.
Related: SPDR SP 500 ETF (SPY), iShares MSCI Emerging Markets Index ETF
(EEM), SPDR Gold Trust ETF (GLD);
*
**Marc Faber is an international investor known for his uncanny predictions
of the stock market and futures markets around the world.*
Video: Commodities, Central Banks, Currencies, Russia
Admin at Jim Rogers Blog - 4 hours ago
Latest video interview, on NewsMax TV.
Topics: Commodities, central banks, currencies, Russia, russian ruble, gold;
*
**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.*
Bonds to Stocks Reallocation Maintains The Illusion And Could Setup Another "Flash Crash"
Eric De Groot at Eric De Groot - 5 hours ago
Central planners continue to chase money out of US Treasuries into stocks
to foster an economic growth illusion that doesn't exist. A steady
increase in the Treasury bond diffusion index (DI) from -96% to 56% (up
from 43% last week) since late May 2012 reflects aggressive accumulation by
the invisible hand. This means nothing has changed and smart...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]European September Car Sales Datapoints
Because the horse and buggy is the new normal car:- FIAT ITALY NEW CAR SALES FALL 24% IN SEPT
- FRENCH CAR SALES FALL 18.3% IN SEPTEMBER, DOWN 13.9% THROUGH SEPTEMBER
- PORTUGUESE LIGHT VEHICLE SALES DROP 42% THROUGH SEPTEMBER
Euro-Zone 'Misery' Has Never Been Higher
While the 'Misery' Index in Iran reaches exceptional levels, and the US aggregate of inflation and unemployment peaked last October, Europe's misery has continued to rise in the face of an ever-easing ECB and political jawboning. As SocGen notes today, the UK's misery has turned back higher and the Euro-zone's Misery Index has never been higher. These misery indices clearly reflect deteriorating economic performances in the main G10 countries, with some unsurprisingly weaker performances in Spain and Greece, leading the eurozone index higher. Given recessionary situations expected in some eurozone countries next year, the misery index is unfortunately quite unlikely to edge south significantly.
European Equities Roundtrip Friday Losses But Credit Is Not Buying It
Catching
up to the apparent 'good news' from the Spanish bank audit debacle and
as we noted earlier, the smallest of beats in a singular data item,
provided some support for equity prices in Europe today. It appeared as
though traders had reduced weight or been modestly short-biased into
the news and the lack of events spurred a reversal - which on its own
looks good but merely returns us to Thursday's close (or not even for
Spain). In other markets, the US ISM data spurred a jump which was
immediately faded in both EURUSD, European sovereigns, and European
corporate/financial credit markets. Bottom line - European equities round-tripped from Thursday but credit markets are much less sanguine.On This Day 70 Years Ago: Fighting Inflation And Hitler
"History may not repeat itself but it does rhyme"
Trading Halted On All NYSE Liffe London And Paris Commodities And All London Universal Stock Futures
Goldman Lowers Q3 GDP Forecast Again, From 1.9% To 1.8%
It seems like it was only Friday that Goldman's daily GDP forecast adjustment team revised its GDP lower. Oh wait, it was. Since it is another day ending in -y, here comes Hatzius' crack commando team with yet another downward revision.As Iran Rial Implodes By 20% In One Day, Follow The Death Of A Currency In Real Time
Iranian clerics' attempts to curb speculation in the Rial and stabilize the currency appear to have backfired as the un-official (real) Rial rate traded as low as 34,250 Rial to the USD this morning - a massive 20% plunge. Demand for gold is surging (as Tehran exchange volume is up almost 18% today) as the population appears to be readying itself for hyperinflationary death - as we wrote yesterday, it really is no fun in Iran. The following tables/links will allow the real-time monitoring of that market's collapse - since Bloomberg's official rates are entirely useless. Instead of allaying fears about the availability of dollars, the centre seems to have intensified the race for hard currency as "The government's initiative ... brought to the surface a tremendous lack of confidence in its ability to manage the currency,"
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Baffle With BS: After Chicago PMI And Durable Goods Tumble, Manufacturing ISM Soars
When in doubt, baffle with bullshit. Just a day after the Chicago PMI posted its biggest collapse in years (not to mention the absolutely horrendous Durable Goods number),
leading everyone to believe that the ISM, and Q3 GDP will be
absolutely abysmal, here comes the Manufacturing ISM number, printing
far above expectations of 49.7, and well above the last print of 49.6,
and in fact posting its first increase since May of 2012. This means
that the ISM to Chicago PMI gap is now the widest since September 2009.
Perhaps the White House's Alan Krueger had run out of explanations for
why the economy is collapsing into Q4, and finally made sure going
forward all economic data will be better than expected. At least until
the election of course. The biggest movers in the September ISM print:
New Orders, Prices, and Employment, all of which posted numbers solidly
in the 50+ range. Now we look forward to either an epic beat in the
Services ISM next, or a complete collapse to continue treating everyone
like mushrooms. In other news, construction spending plunged to -0.6%
from -0.4%, on expectations of a +0.5% increase. But who cares: today
housing is irrelevant as somehow the US manufacturing industry is
improving, all other signs to the contrary be damned.Presenting Einstein's Definition Of Insanity In A Taxpayer Funded Suit
Charlie Evans proved once and for all that he is the 'doviest' dove in the Fed's dove-cote
as he espoused his own special sense of reality with CNBC's Steve
Liesman this morning. His ability to speak out of both sides of his
dual-mandate mouth while suppressing the reality of rising prices and
expounding on the need for the Fed to be more accomodative (we assume
they will stop at infinite infinities of easing), Evans made it very
clear, when pushed on the topic of QE efficacy, that they will continue
to print (unable to provide any quantitative assessment of the result)
until morale improves. That's it; nothing less. Inflation - no worries;
all the time the unemployment rate is where it is they are justified in debasing to the max. Must watch clip to understand why precious metals have surged this morning and stocks not so much as they will repeat the same actions again and again and expect a different outcome.China "Stimulates" Economy By Suspending Road Tolls For Golden Week - Millions End Up Stuck In Traffic Jams
This
one is for the the no good Keynesian deed goes unpunished files. As
part of its 8 day Golden Week celebration, China's central planners
decided to do a good thing for the people and remove all tolls from
expressways. That was the populist explanation. The fundamental one was
that this act would somehow spur the economy. Alas, while the same people may have saved some transit money in the process, what they did not save was on transit times. As South China Morning Post reports,
millions were promptly stuck in traffic jams as a result of the
politburo's generosity. From SCMP: "A bid by authorities to stimulate the economy by suspending road tolls for
the "golden week" holiday brought huge tailbacks across the mainland
yesterday as almost 86 million travelers took to the roads. That's 13.3
per cent more than on the first day of the National Day holiday last
year." And then the fun began: "One traveller blogged that he
could only move 200 metres in an hour on the Zhengzhou to Shijiazhuang
expressway in Henan province. Others said the queue of cars on the Guangzhou to Shenzhen expressway was 40 kilometres long. All roads leading out of Guangdong were jammed, with cars moving at about a kilometre an hour in front of some toll gates.
Provincial traffic-management authorities estimated traffic on
expressways would increase by 40 to 80 per cent compared with the same
period last year, the Shenzhen Special Zone Daily reported. The People's
Daily reported dozens of accidents on 24 highways across the mainland,
further aggravating the congestion."Permadove Chuck Evans Speaks, Precious Metals Soar
Gold and Silver and surging this morning as the Fed's Charles Evans talks on CNBC of the need for more accomodative policy by the Fed. His 'infiniter' easing seems to have sparked this move as he clarifies the seeming psychopathy of the Federal Reserve's actions. His message clearly is that the amount doesn't matter (nor the unintended consequences), the printing and flooding of money into an already stuffed banking system will continue until morale improves.
Days After Disclosing Its 2013 "Austerity" Budget, Spain Announces It Will Miss Revised 2012 Budget Target
Remember when last week Spain disclosed the terms of its 2013 Austerity budget, and everyone, literally, came out of the trunk in the ZZ Top wagon, including Olli Rehn who said Spain had done even more than Europe demanded, which led many to believe this was the basis for Spain preparing to announce its bailout request? Well, today Europe is kinda, sorta force to reevaluate said statement, and poor Mr Rehn has to self-flagellate himself in some Helsinki sauna for speaking too fast, because over the weekend Spain preannounced (the first of many) 2012 budget target misses. The Spanish government said the deficit would hit 7.4% of GDP, which misses the 6.3% target set for the year. The 6.3% number in turn, was a "loosened" goal as the original deficit target for the country set by the Commission was 5.3%. What will happen is that at some point, in late December just like in 2011, Spain will say it was only kidding and the real budget deficit will be in the double digits, or about 100% more than the preliminary announced one. But don't worry: in 2013 all shall be well: IMF, ECB, Spain and Princeton economists all over the world promise, so it must be.Lest We Forget
Leading up to the American Financial Crisis. We all had the data,
we all saw the sub-prime mess, we all saw the leverage, we all saw the
money handed out for nothing and the non-disclosure documents, we all
saw the lack of credible ratings supplied by the ratings agencies and
yet we went on like it would all continue forever. We ignored it all.
We turned our backs but then; we got scalped and so the prime questions
must be asked: Are we wise men or are we fools? Did we learning
anything from the last go round? Should we act now before we are scalped
again considering we only have one head? Since the American Financial Crisis the world has lived off the largesse of the major central banks.
It has been a slippery slope and each capital injection or “save the
world” speech has been met by risk-on and higher markets as liquidity
floods the system. It is a judgment call on our part but we think we are
about done with the effectiveness of moves by the central banks.Eurozone Unemployment at Record Levels
Factory output has shrunk for 14 consecutive months and businesses must continue to trim the fat of their organizations during these recessionary times. The report showed that 18.2 million people were jobless in September; this is an increase of 34,000 people versus the previous month. As living standards fall and livelihoods are being wretched voter anger is becoming increasingly palpable, especially in countries such as Spain and France. History provides countless lessons as to the political consequences of detached economic policies and their real effects. Northern Europe’s gamesmanship in rewriting previously agreed banking debt support may set a dangerous precedent and tear apart the tenuous ties of trust between governments - who after all must act together if they are ever to forge a solution to their current economic plight.Chart Of The Day: College Tuition Vs Real Disposable Income
Curious
why distinguished, Nobel-prize winning economics professors (most of
whom have their own Op-Ed columns and blogs to fill all that free time
they have when they are not actually filling impressionable minds with "this time the model will work" ideas, keeping Solitaireoffice
hours or coming up with arcane, meaningless equations to explain human
behavior) have gone "all in" to defend a system which promotes the
ubiquity of cheap credit, and the creation of a generation of
nondischargeable debt slaves? Because if it wasn't for said cheap,
ubiquitous debt, their salaries would be utterly unsustainable (and for
once austerity would hit the academic ivory tower headquarters of
Keynesianism located in Cambridge, New Haven and West Philadelphia). And
for this they have to thank an economic system they created which is
now disintegrating before their eyes, and in which every incremental
dollar of systemic debt raises total disposable income per capita by
less and less and less.Frontrunning: October 1
- Trade Slows Around World (WSJ)
- Debt limit lurks in fiscal cliff talks (FT)
- Welcome back to the eurozone crisis (FT, Wolfgang Munchau)
- Euro Leaders Face October of Unrest After September Rally (Bloomberg)
- Dad, you were right (FT)
- 25% unemployment, 25% bad loans, 5% drop in Industrial Production, and IMF finally lowers its 2013 Greek GDP forecast (WSJ)
- Global IPOs Slump to Second-Lowest Level Since Financial Crisis (Bloomberg)
- France's Hollande faces street protest over EU fiscal pact (Reuters)
- EU Working to Resolve Difference on Bank Plan, Rehn Says (Bloomberg)
- China manufacturing remains sluggish (FT)
- Samaras vows to fight Greek corruption (FT) ... and one of these days he just may do it
- Leap of Faith (Hssman)
- Germany told to 'come clean’ over Greece (AEP)
Overnight Sentiment Improves On Record Eurozone Unemployment, 14th Consecutive PMI Contraction
After
dropping to its 200 DMA, and threatening to breach its recent support
level of 1.2800, the EURUSD has seen the usual powerlift over the past 4
hours, on two key events out of Europe: Eurozone unemployment, which
came at a record 11.4%, up from 11.3% (which just happened to be
revised to 11.4%) but because it was in line with expectations of the
ongoing recession, all was forgiven. The other event was Eurozone
manfucaturing PMI, which rose by the smallest amount possible from the
46.0 in August to 46.1, on expectations of an unchanged print. That
0.1% "beat" is what has so far set off a near 100 pip rush higher in
the EURUSD, which has ignored the Chinese weakness overnight (the
SHCOMP is closed for the Chinese Golden Week), as well as the UK PMI
which did not share in the European "improvement" and tumbled from 49.5
to 48.4 on expectations of a 49.0 print (so much for that latest BOE
easing), and instead is transfixed by headlines proclaiming the strongest PMI in 6 months.
What also is being ignored is the components in the Eurozone PMI, with
the leading New Order index falling to 43.5 from 43.7. But the data
being ignored the hardest is the French PMI which tumbled to 42.7, the
lowest print in 41 months, of which as MarkIt's chief economist Chris
Williamson said "France is perhaps the new worry, with its PMI slumping
to the lowest for three-and-a-half years." Coming at a 3+ year low
when France desperately needs its new wealth redistribution budget to
be credible, is not the best possible outcome. Bottom line: Europe is
in a recession, but maybe not outright depression just yet, so the
thinking is - buy the EUR, strengthen the currency, make German exports
weaker, and make sure the recession becomes a full on depression. Or
something like that.Today’s Items:
Oh no! Syria is moving its chemical
weapons and Leon Panetta is nervous. He does not know what moves have
taken place, but this can only known by a massive invasion using nukes,
drones, aircraft, special forces, and, of course, Peewee Herman on his
bicycle. To paraphrase Nancy Pelosi, we can’t expose those chemical
weapons until after we invade.
Edgar Cayce reportedly predicted that an
economic crash this October that will begin 10 years of economic chaos
and the signs are there. In fact, many investors are bracing for new economic shock waves with the possibility of a 25% downward correction. In addition, the Chicago PMI is 49.7, which is the first time it was below 50 since September 2009. Add to this, the mess in the Euro-zone and China and things are just ripe for a major economic event.
Silver buying is fast becoming a way for
regular folks to keep some of their wealth out of harms way. The
situation is getting so ridiculous, that the prime minister of wealthy Qatar,
a major investor in US and European assets, is worried about the dollar
and the euro. So, as fiat currencies become worthless; physical
silver will always be a precious metal and worth of some value.
The Royal Bank of Canada, UBS, and maybe
your local bank all borrowed money from the Fed during the third quarter
of 2010. Average use of primary credit from the discount window, the
main form of the emergency loan, was $11m to $36m during the
quarter. Some small community banks, like Gorham Savings Bank in
Maine, made more frequent or heavy use of the discount window. The
short of it is, this information is over two years old and there is no
telling how damaged even local banks are at this point.
Brazil has accounted for more of the
world’s real economic growth since Lehman went broke than any other
country except China. 35 years ago, Brazil was importing food, today
it is a major exporter. Brazil is also energy independent ant has
vast natural resources. With less debt and real growth, Brazilian
households are actually getting richer. So, if Brazil is the new US
then it stand to reason, with everything going on, the US may be the new
Brazil. Olá colegas americanos!
Here are a few…
1. Grow a vegetable garden.
2. Build a compost pile… Unless you live in an apartment.
3. Grow fruit trees.
4. Learn to barter.
5. Be your own handyman and fix-it yourself.
1. Grow a vegetable garden.
2. Build a compost pile… Unless you live in an apartment.
3. Grow fruit trees.
4. Learn to barter.
5. Be your own handyman and fix-it yourself.
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