Marc Faber: "Ron Paul Would Be A Very Good President"

While Marc Faber shares the usual stock of insightful market commentary, together with timing inflection points, and extended thoughts in the attached Bloomberg TV clip, it is the fact that he has officially joined Bill Gross, and so many others, in supporting the candidacy of Ron Paul as president. It is rather sad that only those who see beyond the surface of the current pyramid scheme facade, are bold enough to endorse the only man who is right for the White House. Fast forward to 15 minutes into the video to hear Marc Faber: "Ron Paul would be a very good president."

Greece Draws The Line As Unity Government Leaders Refuse To Cede To Further Troika Austerity Demands

It appears that Greece will not even have to wait until the dreaded March 20 funding D-Day. As was earlier reported, Greek PM Lucas Papademos may resign if he is unable to persuade his coalition unity government to agree to further Troika demands for additional austerity. It now appears that there will be no agreement, and thus the primary demand from the Troika for further cash disbursement will not be met. The FT reports: "All three party leaders in Greece’s teetering national unity government have opposed new austerity measures demanded by international lenders, forcing eurozone finance ministers to postpone approval of a new €130bn bail-out and moving the country closer to a full-blown default. Representatives of the so-called “troika” – the European Commission, European Central Bank and International Monetary Fund – have demanded further cuts in government jobs and severe reductions in Greek salaries, including an immediate 25 per cent cut in the €750 minimum monthly wage, before agreeing the new rescue. But representatives of all three coalition partners, including centre-left Pasok of former prime minister George Papandreou and the centre-right New Democracy of likely successor Antonis Samaras, said they were unwilling to back the government layoffs." Now we have been here before, and as a reminder the last time Greece threatened to pull out of Europe with the G-Pap referendum threat back in the fall, G-Pap was promptly replaced with the Trilateral Commission member and former ECB Vice President, Lucas Papademos. The problem is that for him to obtain power, he needed to form a coalition government. Well, that now appears to be in tatters, as not one party is willing to break to the Greeks that the minimum wage of €750 will be cut even further. The question is who will blink first this time, as it is quite likely that neither the Troika nor Greece want an out of control default. Unless, of course, this was Germany's plan B to the imposition of a Greek commissar all along...

Israel Puts Global Facilities On High Alert Following Warning Of Rising Iran Strike Threat

While the world rejoices in the aftermath of the enjoyable diversion in which a fake market surges on fake, politically-motivated data, which incidentally refutes the warning voiced last week by the Fed Chairman who has a far better grasp of the economy than the BLS, warned last week, the confluence of real events continues to indicate that something is brewing in the middle east. Only this time it is not the US adding another aircraft carrier to the three already situated by the Straits of Hormuz. This time the smoke and fire come from Israel. ABC reports that "Israeli facilities in North America -- and around the world -- are on high alert, according to an internal security document obtained by ABC News that predicted the threat from Iran against Jewish targets will increase. "We predict that the threat on our sites around the world will increase … on both our guarded sites and 'soft' sites," stated a letter circulated by the head of security for the Consul General for the Mid-Atlantic States. Guarded sites refers to government facilities like embassies and consulates, while 'soft sites' means Jewish synagogues, and schools, as well as community centers like the one hit by a terrorist bombing in Buenos Aires in 1994 that killed 85 people." Hopefully the head of security's prediction track record is better than that of the CBO, and that the very act of prediction does not in effect "make it so." At least courtesy of this latest escalation by Israel we get a clue of what to focus on, if not so much who the actual aggressors will be. In the meantime, Iran, which has been dealing with hyperinflation for weeks now, and likely has bigger problems to worry about than focusing on "soft sites" will naturally sense this escalation as the provocation it may well be meant to be, respond in kind, which will lead to further responses of definite attacks imminent by Iran's adversaries, and so on, and so forth, until finally the dam wall finally cracks.

Gold Daily and Silver Weekly Charts

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SP 500 and NDX Futures Daily Charts - Flashbangs, Smoke and Mirrors

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Gold Bulls unable to break through resistance

Trader Dan at Trader Dan's Market Views - 6 hours ago

Today's payrolls number, something which I might add is more akin to an Alice in Wonderland creation, was the factor responsible for the selling in both gold and in silver. The thinking was that if the economy is gathering steam at such a fast clip as the numbers suggest, then any notion of additional QE3 is a pipe dream. That means no Dollar debasement and little to fear on the inflation front so out came the sellers in the gold market. It also did not help the bullish cause that the market failed at a critical technical resistance level. Between the two developments, longs who ha... more » 

 

Another Look at What 'Worked' in the Great Depression

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The Non-Farm Payrolls Report: Air Brushing History - Nominal Work Force for Nominal GDP

Weekly Bull/Bear Recap: Jan. 30 - Feb. 3, 2012

A one-stop shop summary of bullish and bearish perspectives on this weeks news, data, and markets.

Europe Celebrates Its Latest Recession With Record High Gas Prices

Just when you thought it was safe (well not really) to dip your toe back in the ocean of European equities on the back of the LTRO-enthused hope that credit contraction will cease and growth will return, we note another (perhaps more instantaneous) drag on the economic fortitude of the long-suffering people of the EU. Belgium's Beursduivel notes that the national average price for a liter of petrol (gas) has reached a Euro-zone record high of EUR1.76 which equates to a US (not imperial) gallon cost of (drum roll please) USD8.75 (given current EURUSD levels). As Greece, for example, basks in the hope of the failing Troika talks, they unfortunately will have to pay significantly more (double from 3 years ago) for their driving (or boat fuel) as despite the faltering economies across Europe, the price of petrol, diesel, and LPG are also near record highs - and all this without an actual Iran invasion.

TrimTabs Explains Why Today's "Very, Very Suspicious" NFP Number Is Really Down 2.9 Million In Past 2 Months

We have examined the nuance of the euphoric jobs data this morning from every angle and by now there should be plenty of 'information' for investors to make their own minds up on its credibility. However, the avuncular CEO of TrimTabs, who despite channeling Lewis Black lately, likely knows this data a little better than the average Jim on the street having collected tax witholdings data for the past 14 years, is modestly apoplectic at the adjustments. In one of his more colorful episodes, and rightfully so, Charles Biderman notes that "Either there is something massively changed in the income tax collection world, or there is something very, very suspicious about today’s BLS hugely positive number," adding, "Actual jobs, not seasonally adjusted, are down 2.9 million over the past two months. It is only after seasonal adjustments – made at the sole discretion of the Bureau of Labor Statistics economists – that 2.9 million fewer jobs gets translated into 446,000 new seasonally adjusted jobs." A 3.3 million "adjustment" solely at the discretion of the BLS? And this from the agency that just admitted it was underestimating the so very critical labor participation rate over the past year? Finally, Biderman wonders whether the BLS is being pressured during an election year to paint an overly optimistic picture by President Obama’s administration in light of these 'real unadjusted job change' facts. Frankly, in light of recent discoveries about the other "impartial" organization, the CBO, we don't think there is any need to wonder at all.

Is China's Yield Curve Signaling A Harder Landing?

Following our note on the flattening (and update on the steepening) in the Chinese yield curve (RMB 10Y - 2Y to be specific) last November, we have continued to keep an eye on the relationship between the Shanghai Composite and the bond market for signals that all is not well in the recent 'soft-landing' rally. While Chinese shares have seen their best January ever, the RMB curve has flattened quite notably. As Morgan Stanley points out in an FX Pulse update today, the yield curve is an early indicator for local shares, which should not be a surprise given the still restricted Chinese capital account. While we have seen this kind of divergence in the US (where given free capital flows the relationship between yield urves and the equity market has loosened over the past 30 years), in China the relationship is still tight and further flattening of the Chinese curve would call into question the equity market rally (and soft-landing thesis). The flattening RMB yield curve suggests the local bond market has become skeptical of Chinese growth prospects. Should the RMB curve flatten further from here, the anticipated decline of commodity currencies (AUD most specifically for US equity carry traders) could be sooner than expected.

Counterfeit Value Derivatives: Follow The Bouncing Ball

According to the Bank of International Settlements, as of June 2011 total over-the-counter derivatives contracts have an outstanding notional value of 707.57 trillion dollars, ( 32.4 trillion dollars in CDS’s alone). Where does this kind of money come from, and what does it refer to? We don’t really know, because over-the-counter derivatives are not transparent or regulated. With regulated economic markets, when an underlying real asset is impaired (i.e. the company in question is bankrupt, the mortgage has defaulted, etc.), market value is assessed, default insurance is paid up to replacement or full value, bond holders and stock holders make claims on remaining value and the account is closed. There is no need for bailouts because order and proportion of compensation has been established and everything is attached to the value of the underlying asset. When the unreal, counterfeit economy intrudes, you now have a situation where a person can put in an unregulated, but recognized, claim to be paid a thousand times over in case of impairment. Say market participants have negotiated for a bankrupt company a 70% payback for bondholders and (36% payback for insurance claims), and I come with not one but rather 1,000 CDS claims demanding to be paid for each CDS.

Jeffrey Tucker makes the Case Against the Federal Reserve and the Banking Cartel

FDR, The New Deal, and The Expansion of Federal Power with Authors Burton and Anita Folsom

Ron Paul Speaks to Supporters Before Nevada Caucus

TFMR Podcast #12 – John Williams of ShadowStats.com

from TFMetalsReport.com:
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Boy oh boy, do I ever have a timely treat for you today. Back on Thursday, I was able to visit with John Williams of Shadow Government Statistics. In light of today’s heavily-manipulated BLSBS report, I’d say this podcast is rather timely.
As most of you know, my college degree is in Econ so getting a chance to visit with John was a real pleasure. I mention at the end of the podcast that I could have gone on speaking with him for another hour or two but, in respect of his time, I had to cut us off after just 30 minutes. Please take the time to listen to the entire thirty minutes, though. The information that John provides, particularly near the end of the podcast as he discusses the CPI and the coming “hyperinlationary depression”, is extremely important.
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