And just like that Weimar 2.0 is born.
With global markets still tumbling, the Godfather of newsletter writers, 91-year-old Richard Russell, warned people to stay completely out of the stock market while the Fed manipulation continues.
Richard Russell: “I don’t like the way the stock market is looking. Today as I write we have triple digit losses in the Industrials the Transports and the NYSE is below 10,000, which I don’t like.
My best bet is that in due time the NYSE will test 8,000. I am increasingly afraid that we are in a bear market. This could mean that stocks will test the lows of July 1932. …My stance is neutrality. Although in my gut I feel that the market is heading down.
Submitted by Tyler Durden on 09/23/2015 - 17:05 In case anyone should ask you to explain Fed reflexivity in under 100 words, here is the answer...
Submitted by Tyler Durden on 09/23/2015 - 18:00
In a recent article, “How many Good Delivery gold bars are in all the London Vaults?….including the Bank of England vaults“, I considered how much gold is actually in the London Gold Market, and highlighted how the amount of gold stored in the London wholesale market has fallen noticeably in recent years.
That article highlighted that the amount of gold stored in custody at the Bank of England (BoE) fell by 350 tonnes during the year to 28 February 2015, after also falling by 755 tonnes during the year to end of February 2014. Therefore, by 28 February 2015, there was, according to the BoE’s own statement, £140 billion or 5134.37 tonnes of gold in custody of the BoE, or in other words ~ 410,720 Good Delivery gold bars.
Submitted by Tyler Durden on 09/23/2015 - 18:18 As Bloomberg reports, "President Vladimir Putin, determined to strengthen Russia’s only military outpost in the Middle East, is preparing to launch unilateral airstrikes against Islamic State from inside Syria if the U.S. rejects his proposal to join forces, two people familiar with the matter said."
Submitted by Tyler Durden on 09/23/2015 - 17:30 There is blood on the streets wherever you look in Brazil today, but probably of most interest to the hundreds of US asset managers (the ones managing your mutual funds) is what happens to Petrobras as it remains so widely held. As we noted below, bond prices are collapsing and default risk is soaring, and with the nation's currency collapsing amid the lower-for-longer oil prices, $90 billion of dollar-denominated debt could soon potentially be too burdensome for the company to repay.
Submitted by Tyler Durden on 09/23/2015 - 16:40 As powerful as the Fed is, it isn’t stronger than the markets. And the longer the Fed tries to sustain abnormalities like QE and 0% interest rates, the more likely it is that the whole business will end with the markets crushing the Fed. At the next sign of a market swoon or of a weakening economy, or with the next episode of deflationary jitters, the Fed will do whatever it takes, no matter what the eventual damage to the dollar’s value. Whatever the details, one thing should be clear. This politburo of unaccountable central planners is the greatest risk to your financial wellbeing today.
Submitted by Tyler Durden on 09/23/2015 - 16:08
Submitted by Tyler Durden on 09/23/2015 - 15:55 It appears Darwin was on to something after all. In the most stunning statistic of the new narcissistic normal's sharing economy, The Sydney Morning Herald reports that, since 2013, deaths from shark attacks have been outnumbered by deaths while taking a selfie. In Russia, the danger has apparently become so acute that in July police launched a campaign urging people to take care after about 100 people were reportedly injured while taking selfies.
Submitted by Tyler Durden on 09/23/2015 - 15:40 Great companies like Hewlett-Packard are now being run not by adult professionals but day-trading punters. Carly Fiorina was one of the latter. She excelled at mastering her flash cards and pitching financial bubbles from the time of the misbegotten Lucent IPO, to her campaign for the Compaq acquisition, to her final days at Hewlett-Packard. What she didn’t excel at was learning a single thing that qualifies her to be President of the United States - not the least of which is humility. Fiorina needs to shut-up, sit down and flush her flash cards. The furtherance of liberty, prosperity and peace are not what Torquemada’s do.
Submitted by Tyler Durden on 09/23/2015 - 15:10 As tipped last month, the IAEA is allowing Iran to self-police the sample collecting process at a controversial military installation. Although inspectors and Iranian officials give conflicting accounts, what's clear is that Tehran is not at all prepared to accept a situation that causes the Rouhani government to lose credibility with the Iranian public. Expect GOP lawmakers (not to mention presidential candidates) to hold this up as yet another example of why the deal is likely to blow up (figuratively speaking we hope) in the face of the Obama administration.
Submitted by Tyler Durden on 09/23/2015 - 15:20 According to Interfax, Russia may deploy Iskander ballistic missiles to its enclave of Kaliningrad should the US go ahead with plans to send 20 nukes to Germany.
Some organic food experts are worried that the term used to describe non-genetically modified crops and produce may soon become nearly meaningless, thanks in large part to undue (read corporate) influence on the Department of Agriculture.
According to Jerome Rigot, PhD, writing in a blog posted at the Cornucopia Institute, which promotes food safety backed by science, it may no longer be accurate to rely on the USDA’s “organic” labeling as remaining “true to its mandate of assuring consumers that food under this label is truly healthy and grown or raised with minimal impact to the environment,” as well as respecting “the health and well-being of the workers and animals involved.”
On episode 27 of Red List News, Dave goes deep with a warning to everyone who has FRN’s in the bank. When things get flushed, you get paid last because it’s not your money. Speaking of theft, Jim follows with a report about a JFK Airport TSA agent who gets caught lifting 63 of the aforementioned FRN’s right out of a victim’s wallet. Data mining and Common Core is covered by Dave next, while Jim spotlights the vaccine doctor who turned the tables on the drug companies. Our final two offerings have an international flare as Dave examines the determination by Russia to protect Syria from ISIS, and Jim reports about the similarities between Deutsch Bank of today, and Lehman Brothers of 2008.
Although the mainstream media would like you to believe he hasn’t put out any actual polices, earlier this week Donald Trump pledged his support for nationwide conceal carry.
Trump’s 2nd amendment policy plan, titled “Protecting our Second Amendment rights will make America great again”, proposes a “National Right to Carry” law – something I would argue already exists under the second amendment, but hey, at least we have some candidates finally acknowledging our right to carry.
In his policy plan Trump says, “The right of self-defense doesn’t stop at the end of your driveway. That’s why I have a concealed carry permit and why tens of millions of Americans do too. That permit should be valid in all 50 states.”
Before the West spreads democracy abroad maybe it could get some for itself. The US is an oligarchy in which government is answerable to six powerful private interest groups. In Europe governments are answerable to the EU, Washington, and private bankers and not to their peoples. In the UK the military brass has declared its hold on the reins of power.
Jeremy Corbyn is the first Labourite to lead the Labour Party in a long time. Considering the stupidity and immorality of the Tories, Corbyn could become prime minister of Britain. Should this occur, Corbyn would shift the budget priorities away from supporting Washington’s wars toward refurbishing the social welfare state that made life for ordinary Britishers more secure and less stressful.
The total lock down of Philadelphia began yesterday. The socialist, left wing, rockstar pope arrives in the U.S. today, causing mass gridlock, lost economic productivity, and another opportunity for our Orwellian police surveillance state to flex its muscles and treat its citizens like cattle and sheep. It started with the lock down of Boston a couple years ago as the all-powerful State took a giant shit on the Fourth Amendment as they hunted down two teenage utensil bomb terrorists. The DHS thugs have continued to militarize Barney Fife police forces around the country. Every man, woman and child is treated like a terrorist when going to a god damn baseball or football game. As reported by Marketwatch, the pope will inconvenience millions in three large US cities over the next six days.
The precious metals community will find the latest from Anonymous interesting. But reading between the lines is critical…
Years ago I came to the conclusion that “Anonymous” is an enigma and contradictory in nature because some of the people that associate with it are genuine activists, but the enigma also appears to be infused with government operatives. At first glance, “Operation Black October” raises important questions worthy of further examination.
On September 20, Anonymous posted the following on their official website:
Last week the clock ran out on the Fed’s latest bluff. They have gone 55 meetings over 80 months without a single tightening or rise in interest rates. Last week was supposed to be “different” and a tightening of credit was predicted by something like 82% of economists polled. We of course now know that no tightening occurred and a trial balloon was even floated about instituting a new round of QE…
This of course was an easy one to call. Look at what the markets have done since that meeting, how much worse would it be had the Fed actually raised rates? Look all around the world and especially at China beginning to unwind, do they need a tightening of credit? They just devalued the yuan again yesterday (without any mysterious plant explosions …yet), had the Fed tightened you must ask yourself how much bigger the devaluation would have been by market forces?
Leading into last week, I think the easiest way to know that credit did not need to be tightened was by looking at international trade. This is one area where the “numbers are the numbers” and are not massaged (annihilated) by government reporters (not to mention mainstream reporters!). You see, the trade numbers pretty much need to match up and the freight rates are extremely hard to hide. Pretty much, they are what they are and if lied about are too easy to debunk. Last week, Zerohedge wrote on this topic when they penned WTO’s Stark Warning On Global Trade: “The Timing Belt On The Global Growth Engine Is Off”.
Further, if you look below at the Baltic Dry index, do you see a “recovery” from 2008 or a dead cat bounce which is now waning? THIS is indicative of global GDP, anything different from individual countries is an outlier and must be seriously questioned (including China).
But why is this even important? First, because it is the REAL PICTURE but more importantly it is a very strong clue to actual rather than “made up” GDP. Spelled out for you, GDP is not growing enough (or at all) to create and bring new capital into the system. “The system” being one which has far more debt than it did during the 2007-09 event. Do you see where I am going with this? Clearly not enough growth exists globally to create the new capital necessary …yes that’s right…to carry a much larger debt load than we had back then!
Maybe it would be a good thing to remind you, one of the big problems back in 2008 was “too much debt”. Not only did the world not “liquidate” debt, it has taken on much more with an underlying economy that has been weakening for several years.
Going back to the top and full turn, how could the Fed have tightened last week? Or better, how can they ever tighten? The next move will be further additions of liquidity …at least as long as markets are open to do the “add”. Of course, just pulling the plug on the computers is another option!
Comments welcome! bholter@Hotmail.com
Submitted by Tyler Durden on 09/23/2015 - 16:26 It's all clear now...