Submitted by Tyler Durden on 08/29/2015 - 18:04
The virtuous circle that has sustained the dollar and buoyed USD assets for decades has definitively been broken. Now, with China's Treasury liquidation serving to exacerbate the pressure from the demise of the petrodollar, it's critical to take stock of accumulated petrodollar reserves in order to understand how large the unwind could ultimately be in a worst case scenario. As it turns out, narrowly focusing on official FX reserves could understate the size of petrodollar accumulation by some $2.5 trillion.
The restarted nuclear WEAPONS POWER PLANT IN SENDAI JAPAN was directly hit by the Typhoon and has been without POWER FOR 5 DAYS, reports are coming in to ME that they have experienced a partial meltdown the Readings around the plant support my sources, kevin D. blanch
Today whistleblower and London metals trader Andrew Maguire warned King World News about a shocking even that will change the gold market forever.
Andrew Maguire: “Producers are beginning to seek alternative venues to sell their gold at the offer and bypass London (the LBMA) altogether. This is why we are seeing price divergences appear between the paper markets and the physical markets….
Producers are the key to breaking the hold the collusive bullion banks have on the gold price and it is now underway. This is history in the making. We see the CME trial ballooning a deliverable gold exchange and contract here in London. You have to ask yourself: Why would they do this if the largest global gold market (the LBMA) was functioning properly. It’s because liquidity has simply vanished.
On the front cover of Washington State’s August 2015 “Inlander” magazine, Spokane County Sheriff Ozzie Knezovich is shown hands on hips standing on top of the “Don’t Tread On Me” (Gadsden) flag. The title of the article is “Daring To Tread.”
The sheriff and at least one of his deputies have verbalized opinions that “constitutionalists” are threats to the sheriff’s office, the federal government, and to the country itself. Sheriff Knezovich even went so far as to compare “constitutionalists” with the Sunni Muslim terror group ISIS. The deputy indicated that the presence of armed “constitutionalists” in the county was the principal reason why the sheriff’s office was amassing military equipment. When asked to name names as to who he was referring to, Spokane County’s highest-ranking law enforcement officer (Sheriff Knezovich) named Washington State Representative Matt Shea and radio talk show host Alex Jones (who resides in Texas, not Spokane County, Washington).
Submitted by Tyler Durden on 08/29/2015 - 10:06 Tens of thousands of demonstrators poured into the streets of Kuala Lumpur on Saturday to call for the resignation of Prime Minister Najib Razak whose government has been accused of obstructing an investigation into how some $700 million from the Goldman-backed 1Malaysia Development Berhad mysteriously ended up in Najib’s personal bank account. Meanwhile, the country stands on the precipice of an outright financial meltdown.
Submitted by Tyler Durden on 08/29/2015 - 16:54 Is AAPL the next AOL, and is Tim Cook the next Thorsten Heins? It all depends on China: if the world's most populous nation can get its stock market, its economy and its currency under control, then this too shall pass. The problem is that if, as many increasingly suggest, China has lost control of all three. At that point anyone who thought they got a great deal when buying AAPL at $92 will have far better opportunities to dollar-cost average far, far lower.
Submitted by Tyler Durden on 08/29/2015 - 16:20 While status quo-huggers are all too happy to point out gold and silver's lack of utter exuberance amid this week's carnage, perhaps they need to re-comprehend the difference between a heavily manipulated 'paper' market and the surging demand for physical precious metals that is evident in the 20-plus percent premium - and rising - being paid for silver bullion currently...
Submitted by Tyler Durden on 08/29/2015 - 13:15 Small Cap stocks are in the middle of their worst summer doldrums since 2011 - and in fact for many individual stocks, worst summer since the collapse in 2008/9. While talking heads proclaim these smaller (supposedly more domestically-oriented) stocks a must-own, they have underperformed significantly as the credit cycle turns (thanks to their higher sensitivity to funding costs, among other things). Judging by this week's farce, the supposedly high-beta small caps are being BTFD'd aggressively either and perhaps that is because, since 1926, on average, September and October are the only months in which small-capitalization stocks have posted losses.
Submitted by Tyler Durden on 08/29/2015 - 12:41 Today's most anticipated event at tthis year's Jackson Hole event was the panel on "Global Inflation Dynamics", not because there is any core inflation in the world (at least not in the way the CPI measures it), especially not now that China is finally in the deflation exporting business, but because the most important speaker at this year's Jackson Hole, Fed vice chairman Stanley Fischer, alongside BOE's Mark Carney, the ECB's Constancio and the RBI's Raguram Rajan, would comment. Moments ago he just did, and courtesy of Market News, here are the highlights.
Submitted by Tyler Durden on 08/29/2015 - 17:29 Here are some modestly optimistic musings on what may be next in the cards for Greece...
Submitted by Tyler Durden on 08/29/2015 - 11:45 Some context for those who insist renewables will 'solve' everything...
Submitted by Tyler Durden on 08/29/2015 - 11:04 So why did debt levels rise so dramatically after the final central bank restraint was removed? It is essentially due to the massive subsidy central bankers provided. If you tax a thing you get less of it (think all the tax on labour) but if you subsidise it you will get more of it. As time went by, debt obviously grew ever larger and eventually large enough to become an integral part of the business cycle. In other words, central banks could not stop the subsidy for fear of creating, well, a 2008 financial meltdown.
Submitted by Tyler Durden on 08/29/2015 - 09:14 The more we think about it, the less the classical division between microeconomics (which studies the behavior of individuals and production entities) and macroeconomics (which deals with the performance of the economy as a whole and not its individual markets and components) makes any sense - certainly not in the 21st century. And in our view it is this disconnect between the two that is at the heart of the failure of Keynesian economics – which at best is incomplete and at worst is all just baloney.
Submitted by Tyler Durden on 08/29/2015 - 16:20 Donald Trump is no phenomenon or wonder, only someone money has been immunized and given a suit of armor under our capitalist system; a person with true elite-freedom. No, Trump is just a figurehead for those with closeted anger trying to resist unstoppable change in the world and resent their loss of power.
Submitted by Tyler Durden on 08/29/2015 - 15:44 "The [Chinese] slowdown was predictable, predicted, unavoidable," Lagarde was quoted as saying." Well, yes, it was... by everyone but the IMF. Here is the history of the IMF's Chinese GDP growth forecasts taken straight from its World Economic Outlook quarterly pieces. The graph needs no explanation.
Submitted by Tyler Durden on 08/29/2015 - 15:10 Iif there is one currency in the world that “deserves”, so to speak, ultimate execution it is that of the Japanese. The Bank of Japan has done more than any other central bank for far longer to kill it, but like any horror movie villain it seems immune to any reckoning or even the laws of financial sense. In the bigger picture, that is as much a damning indictment as a tale of orthodox resilience. It shows that monetary redistribution is nothing but a trap, an incredibly narrow and locked economic existence that can and will be permitted by any sustained apathy.
Submitted by Tyler Durden on 08/29/2015 - 14:35 Political turmoil isn’t Malaysia’s only problem. Two weeks ago, in the wake of the yuan devaluation, a $10 billion bond maturity sparked the largest one-day plunge for the ringgit in two decades, serving notice that whispers about a replay of the currency crisis that gripped the country in 1997/98 were about to become shouts. Because it appears the situation is set to deteriorate meaningfully in the near term, and because the country’s political situation could serve to undermine already fragile confidence, we thought it an opportune time to revisit exactly what happened two decades ago.
The Republicans had a little focus group who watched taped instances on a television of Trump’s apparent misogyny, political flip flops and awe-inspiring braggadocio. They watched the Donald say Rosie O’Donnell has a “fat, ugly face.” They saw that Trump once supported a single-payer health system, and they heard him say, “I will be the greatest jobs president God ever created.” But the group—which included 23 white people, 3 African-Americans and three Hispanics and consisted of a plurality of college-educated, financially comfortably Donald devotees—was undeterred.
At the end of the session, the vast majority said they liked Trump more than when they walked in. The people conducting this experiment were stunned. The Republican leadership is clueless because they are part of the group the people hate so much.
In March 2012, President Obama quietly signed an Executive Order that has major implications should some sort of national emergency arise, such as enabling the federal government to take over management and distribution of all food, water and other resources.
In issuing the order, EO 13603, titled, “National Defense Resources Preparedness,” Obama claimed authority under the Defense Production Act of 1950, a Korean War-era statute (50 U.S.C.) (see it here) that gives the government the power to marshal whatever resources are necessary to protect and defend the country during “military conflicts, natural or man-caused disasters, or acts of terrorism within the United States,” the statute says.
In justifying the order, Obama wrote in Section 102 under “Policy:”
There were a little over 73 tonnes of physical gold withdrawn from the Shanghai Gold Exchange in the latest week ending August 21st. This is the 4th largest withdrawal of bullion in its history.
It is hard to tell what exactly is going on in such a dodgy, highly leveraged market, with its determined attempts to keep the price knocked lower so often during the late London to NY trading hours.
But I am sensing a change in the market, and more things running under the surface than meets the eye.
Goldman is no major player in the gold bullion market, but it did strike me as odd that they are suddenly stopping large amounts of bullion for their own house account this month. It is not that they are a player in gold, because they are not. But that they are wired into many sources of information, are good at spotting trends, and are more like a hedge fund, comfortable running on the edge of the markets.
On Sunday, June 29, the Associated Press ran the following headline: “Greek Banks will not open Monday.”
After a lengthy cabinet session, it was decided that Greek banks would remain closed for 6 working days, along with restrictions on cash withdrawals. In addition, financial sector officials confirmed the Athens Stock Exchange would not open the following week.
ATM withdrawals were capped at 60 euros ($66) per day. Web bill-paying banking was allowed, but moving money out of the country was prohibited. A side notice reported that Greeks could not remove cash from safety deposit boxes.
“The Donald” breathed a sigh of relief. He and other rich people got a break from the beating they’ve been taking: Stocks bounced, with the Dow ending yesterday’s session up more than 600 points.
But is the bounce to be trusted? And are there better, more tangible, alternatives to investing in stocks? We’ll try to answer both questions in today’s update… We’ll also respond to a reader’s feedback on Mr. Trump in today’s Mailbag.
Yesterday’s bump confirms the mainstream view: There is nothing to worry about. The recent sell-off is just a case of nerves, not a sign of an epizootic. Here is U.S. Trust, a private bank for the ultra-wealthy, reassuring its customers:
In 2007, Russia agreed to supply Iran with five battalions of S-300 medium-range air defense missiles. They designed to defend military, industrial and other strategic sites against enemy air attacks.
Russia’s technology is the most sophisticated air defense systems in service, able to destroy targets with pinpoint accuracy. Its newest generation S-400s have both medium and long range capability.
In 2010, then President Dmitry Medvedev agreed to observe Security Council Resolution 1929 – imposing new sanctions on Iran on top of earlier ones. He annulled the 2007 S-300 contract.
“I am done asking people in my community to outsource their personal safety to the government,” Milwaukee County Sheriff David Clarke told Fox News’s Sean Hannity Thursday night.
The sheriff accuses Democrats of “exploiting misery and tragedy” to pursue a political, anti-gun agenda.
“But here’s my challenge to the president of the United States, you think this is so easy. Forego your Secret Service protection, for you, for the first lady, and your children, and see what it is like to have to fend yourself.
“And then we’ll sit down and have a conversation so you know what we here at ground level have to deal with on a daily base in terms of self-defense.”
In terms of the really big shifts in the voting base of political parties, the largest shift happening right now is the ballooning of Democrat party voters who are illegals. The Democrats have fought hard to outlaw voter ID laws while maintaining wide-open borders, essentially surrendering America to a foreign invasion as a deliberate strategy to win elections and stay in power at any cost. (It’s a wildly successful strategy if you wish to win votes, but widely suicidal if you wish to keep your nation strong.)
Despite all this, there’s a massive shift in voter demographics that could emerge virtually overnight, causing large numbers of fatalities among those who tend to vote for Democrats. It turns out that people who live in cities are far more likely to die in the unfortunate aftermath of various catastrophic events. (Cities are death traps, as I’ll explain below.)