Obama Promises Bunker Busters To Israel If Netanyahu Delays Iran Invasion Until After US Elections
Two days ago Obama held a press conference in which he openly prevaricated and
disinformed the world about the true nature of his meeting with Israel
PM Netanyahu. Today we find what was truly discussed, courtesy of
Israel's Maariv newspaper, Spiegel and Reuters, which all tell us that it was a simple case of quid pro quo, namely that Barack
Obama would supply Israel with bunker-busters and refueling planes if
Bibi promised to delay an Iran attack until after the presidential
election. The implication is simple - avoid an oil price shock
this summer and delay it until next winter when Obama will be safely in
his throne for another 4 years, at which point US citizens can fuel
their cars with combustible urine following nights of binging on
Everclear in hopes of ending their sorrows with alcohol poisoning, or
better yet, all be in possession of the heavily subsidized flaming half
ton block of metal known as the Obama Pinto, er, Volt.War With Iran Is Coming
The rally for what could be World War III is in full swing.
The truth amounts to very little on the eve of war. Iraq and the lies
surrounding weapons of mass destruction proved this lesson almost a
decade ago. Unfortunately for the people of America, Israel, and Iran,
the political class and power wielders of their respective governments
refuse to learn. Their desire is for more authority and prestige; no
matter how many bodies it costs. With the administration now seeking to provide assistance to the opposition forces in Syria, intervention and war with Iran is only an eventuality at this point.Perspectives On A Printing Press Pause
It
would appear, given the actions and rhetoric of the last week or so,
that global central bank printing presses have been switched to 'pause'
mode and allowed to cool as implicit inflation 'energy' rears its
economic-growth-dragging head around the world (as the bears told us earlier).
Whether this leads to a slow grind higher or a tactical correction is
the question Morgan Stanley considers in a recent note and their answer
is that bullish sentiment, 'under-appreciated' risks, and 'tranquil' markets justify a cautious asset allocation.
The focus has switched much more to growth, likely why we have not
seen a greater deterioration post-printing yet, but this leaves the market much more sensitive to data surprises
(as the backstop of QE has been removed for now). Simply put, we tend
to agree with MS' view (given our previous discussions of the volatility
surface) that as event and growth risks linger, and with valuations no
longer cheap in most cases, expectations of a continued grind higher
without a tactical correction are overly confident.
China is evacuating thousands of its
nationals from Syria. The evacuation may be prompted by early warning
of an escalation of the 12-month violence in Syria or the war-drums from
the U.S.. Hang on Lassie. It gets bumpy from here.
Next…
Brazil Overtakes UK to Become World’s Sixth-Largest Economy
http://www.telegraph.co.uk/finance/globalbusiness/9126786/Brazil-overtakes-UK-to-become-worlds-sixth-largest-economy.html
Brazil Overtakes UK to Become World’s Sixth-Largest Economy
http://www.telegraph.co.uk/finance/globalbusiness/9126786/Brazil-overtakes-UK-to-become-worlds-sixth-largest-economy.html
Although Brazil’s economy only grew by
0.3 percent, it was enough to overtake the UK as the 6th largest
economy. This is showing that the BRIC countries are slowly becoming the
dominate economic powers in the world. Go figure.
German lawmakers are to review Bundesbank
controls of and management of Germany’s 3,396.3 tonnes in gold reserves
because many in the German public are getting very nervous. 60% of
Germany’s gold is stored outside of Germany and much of it in the
Federal Reserve Bank of New York. No wonder the German people are
nervous. Since Germany is known as the land of chocolate, those auditors
better physically check those gold bars for chocolate.
The American consumer borrowing reached
$2.5 trillion in December of last year, nearly matching the
pre-recession level. How will this credit be paid off? The printing of
more Obama money.
Next…
This Year’s California State Budget could be Bizarre Exercise
http://www.sacbee.com/2012/03/07/4317239/dan-walters-this-years-california.html
This Year’s California State Budget could be Bizarre Exercise
http://www.sacbee.com/2012/03/07/4317239/dan-walters-this-years-california.html
The California state government has to
deal with the fact that they will again see the hammering of the budget
this year. A fact that state legislators, unwilling to deal with
deficits during an election year, are not going to like. In fact, the
Democratic primary is on June 5th, just 10 days before the June 15
constitutional deadline for a state budget. They have everything for a
circus, elephants, donkeys, clowns and a ringmaster… Only thing they
need are some freaks… paging Timmy Geithner!
Next…
Police Given Direct Line To Cell Phone Searches
http://dfw.cbslocal.com/2012/03/06/police-given-direct-line-to-cell-phone-searches/
Police Given Direct Line To Cell Phone Searches
http://dfw.cbslocal.com/2012/03/06/police-given-direct-line-to-cell-phone-searches/
The 7th Circuit ruled it is now legal for
police to search cell phones without a warrant. The judge argued that
it was similar to flipping through pages in a diary; however, the
constitutional question should be what probable cause is there to flip
through the pages of a diary?
Next…
How To Get Anything Through TSA Nude Body Scanners
http://www.youtube.com/
http://tsaoutofourpants.wordpress.com/
How To Get Anything Through TSA Nude Body Scanners
http://www.youtube.com/
http://tsaoutofourpants.wordpress.com/
This YouTube censored video demonstrates
at two different airports that the advanced imaging scanners are a flop.
In short, metal appears black. The background around a person’s image
appears black; therefore, a person hiding something on their side cannot
be detected by these scanners. More epic amounts of money wasted by the
unconstitutional TSA.
Please take a look a the You Tube video
showing, in real time, how electronic voting machines can be hacked
using the voting memory card. The video clearly shows how votes can
actually be subtracted from one candidate and added to another. As Josef
Stalin said “Those who cast votes determine nothing. Those who count
the votes determines everything.” This is one possible reason why Ron
Paul is almost non-existent in voting despite the huge turnout for him.
A Few Thoughts On China
Admin at Jim Rogers Blog - 3 hours ago
There will be setbacks in China along the way. In America in the 19th
century we had 15 depressions with a capital "D," we had no human rights,
we had not much rule of law, had a horrible civil war, yet we became the
most successful country in the 20th century.
China is going to have plenty of setbacks but what these guys are mainly
missing is China has been in decline for three or four hundred years but
started turning it around in 1978. And there’s a long history of
entrepreneurship, capitalism, they have the brains, they have the know-how,
there are many overseas Chinese who wil... more »
Middle East: Equities Outlook
Admin at Marc Faber Blog - 3 hours ago
If I were just an emerging markets investor I would probably have an
overweight position here in the Middle East. - *in Zawya*
Related, iShares MSCI Emerging Markets Index ETF (EEM)
*Marc Faber is an international investor known for his uncanny predictions
of the stock market and futures markets around the world.*
Ending QE is Not An Option
Eric De Groot at Eric De Groot - 3 hours ago
Chart 1: U.S. Dollar Index and the COT Futures and Options Open Interest
Stochastic Weighted Average While the improving business conditions
argument provides headline fodder during election years, its ability to
mitigate the West's crippling debt burden is negligible at best. Debt pile
has become too large to be solved by economic growth alone. At this point
the only relevant questions...
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content, and more! ]]
Up Trend Resumption Requires Confirmation
Eric De Groot at Eric De Groot - 3 hours ago
The test of previous resistance as support is always important. Smart money, highly disciplined and patient, waits for confirmation that the up trend will continue rather than blindly chasing short-term oversold readings (see chart below). Positive divergences between price and internal trend energy as well as a sharp contraction in volume during the testing process would favor trend... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
Did Greek Bond And CDS Traders Just Ring The Bell?
As
we hear from one government spokesperson after another that the Greek
PSI deal is 'going well' which appears to us to be a misnomer as either
its done or its not, we note that the price for the Greek CDS-Bond basis topped Par today for the first time.
While there is some noise in this (and extremely wide bid-ask
spreads), looking at the ask on the bonds and the bid on the CDS which
measures more accurately the price at which basis traders can exit the
trade (though liquidity is challenging), it would appear that some
hedgies are ringing the bell on this trade and covering at better than
Par levels. While we would have expected some basis traders to hold
through the event horizon, it makes little sense to look a gift horse
in the mouth as the trade has met its 'theoretical' limit (and beyond
in fact as the add-ons from EFSF and GDP warrants leave some extra on
the table). The point is that the basis (the price of buying a
Greek bond and fully hedging its 'default' risk) has peaked, implying a
credit event is 100% priced in suggesting CACs are on their way later
today (despite current 'news' reports'). If the Greeks really
have the needed participation then we would expect to see CDS dump
tighter as everyone scrambled out - even to the 45% upf that some think
'new' CDS should trade at, this is not occurring.Greek Reports Peg PSI Participation At "Over 75%"
With less than 4 hours until the Greek PSI deadline (8pm GMT), the time to start spreading rumors has arrived. Sure enough, courtesy of Reuters:- SENIOR GREEK GOVT OFFICIAL SAYS TAKE-UP IN DEBT SWAP EXCEEDED 75 PCT LATE LAST NIGHT
Art Cashin Deconstructs The Fed's Paradoxical QE Approach
Yesterday we were quite amused to note that following the Hilsenrath leak (pre-backpeddaling as a result of some FRBNY spanking) of a sterilized QE that for supposedly tries to avoid "generating" inflation (hence confirming that QE does in fact stimulate inflation instead of being a tool to lower rates and make housing affordable) the market reaction was... inflationary, with stocks rising, but far less than crude and gold. So much for the Fed's trial balloon to see if it can intervene in the market without costing Obama a few million ballots. Today, Art Cashin observes precisely the same paradoxical response in his daily note.Moment of PSI Truth
Today
is supposedly the day. The initial deadline for Greek PSI will occur
later today (unless of course it is extended somehow - but will be released here)
and while CAC activation (and hence eventual 90% participation) is the
consensus most likely outcome for bonds under Greek law (but not for
all bonds under English law) - which the market appears to be very
comfortable with given overnight trading - there are still risks, as
BofA notes, that a number of low risk but high impact events unfold with extremely negative connotations.
Clarifying expectations and market implications, it does seem that
while BofA is a little more sanguine than us on this initial deadline,
that the market's complacency is extremely high.SocGen: "Today's Move Is Simply Stupid"
Presented in all its incredulous glory, SocGen's EM desk's shock at the sheep-like ignorance of investors heading into the PSI and NFP... "I have tried my best to remain relatively bullish towards global emerging markets (GEM) over the recent period despite the global risks, but even by my bullish bias standards, today’s move is simply stupid. EM assets are rallying with a vengeance today, but the timing of that move is just wrong, in my view. Why now, ahead of a massive event risk, namely the results of the PSI released tonight? So unless EM investors know something I don’t—which would indeed make me stupid—today’s move is at best premature and quite a bit far-fetched."Initial Claims Miss Expectations, Rise For Third Consecutive Week For First Time Since August 2010
Initial claims print +362K, missing consensus of 352K, and up from a upward revised, (of course) 354K. As a reminder, last week's print was expected to be 355K, instead coming at 351K spiking the market far higher. Needless to say, the response would have been far more muted had the number come at its true final print of virtually on top of expectations, but who cares anymore - everyone appears to enjoy lying and being lied to. That this miss comes ahead of a critical NFP print will likely have some scratching their heads especially since this is the first time we have seen three consecutive weeks of rises since August 2010. Also keep in mind next week, today's 362K will be upward revised to 365K. Hence the immediate if not sooner need for more, more, more QE. Continuing claims also missed at 3416K vs exp. of 3400K, and rising from an upwardly revised 3406K. Finally, EUCs and Extended benefits rose by 27K. Finally, when it comes to comparing before and after, we think it always makes sense to see the full picture, not just initial claims, and account for continuing and extended. Here is what it looks like for all those who tell us that the labor situation is as good as it was in 2008.
Ex-ECB's Juergen Stark Says ECB's Balance Sheet "Gigantic", Collateral Quality "Shocking"
The German criticism of a mess they themselves have enabled (and benefit from via peripheral current account deficits funded via TARGET2 as shown previously here) at the ECB continues, and following public protests by Bundesbank head Jens Weidmann about recent ECB activity, it is the turn of former ECB executive board member Juergen Stark to take center stage. In an interview with the Frankfurter Allgemeine, warned that following the massive expansion in the ECB's balance sheet, in which it is clear to anyone that the ECB will accept used candy bar wrappers as collateral, that "the balance sheet of the euro system, isn't only gigantic in size but also shocking in quality."ECB Keeps Rate Unchanged At 1.00% As Expected
As expected, no rate changes from the ECB. Former Goldman alum Draghi is also not expected to say anything provocative at the press conference due in 45 minutes.Frontrunning: March 8
- Investors help Athens over bailout hurdle (FT)
- Greece Moves Closer to Swap (WSJ)
- U.S. Warns Apple, Publishers (WSJ)
- China offers other Brics renminbi loans (FT)
- Court Challenges EU on Bank Downsizings (WSJ)
- QE blamed for surge in pensions shortfall (FT)
- Tang: Open to adjusting dollar trading band (WSJ)
- U.S. Report to Warn on Cyberattack Threat From China (WSJ)
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