World food prices rise further, raising fears of unrest
Eric De Groot at Eric De Groot - 5 hours ago
The trend for the CRB foodstuffs is up due to rising demand and aggressive
currency devaluation across the globe. Probabilities favor higher prices
once previous resistance is tested as support. Chart: CRBFoodstuffs And
Year-over-Year (YOY) Change Headline: World food prices rise further,
raising fears of unrest (Reuters) - Global food prices rose in March for a
third...
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Don't Show This Chart To The President
One
can write lengthy essays, op-eds, and client letters explaining both
why the labor force participation rate is plunging due to innocuous
reasons such as everyone over 40 retiring yesterday full of jouissance
and excitement to begin the sunset phase of their lives using copious
life savings earning 0.0001% in interest, or, inversely, why this is one
great big propaganda ploy by the BLS to make Obama look good a few
short months ahead of the pre-election debt ceiling breach, pardon, his
re-election date. We prefer cutting to the chase. Here is today's chart
of the day from BofA, which begs one simple question: when will the
two time series recouple, because recouple they will, and how will
America react to the realization it was lied to for 2% worth of
unemployment "improvement"? The chart says it all.Today’s Items:
China’s consumption boom is drawing to a
close and this is going to have massive repercussions for economies all
around the globe. Everything ranging from Australians miners to iPhones
are due for a reality check. Also, forget China buying the U.S. debt
because they don’t want something falling in value. They may have
already sent this signal to the U.S.; which is why the U.S. government
is quickly getting ready for something big.
Did you hear about the Egan Jones Credit
rating agency cutting the U.S. credit level from AA+ to AA last week?
Well, neither did I. This is because Obama ordered the press not to do
its job. We are talking about a blackout from virtually all of major
news media. The fact is, the central elite are losing control everyday
and their schemes are becoming more apparent to everyone.
Please take a look at the images of
soldiers with the 67th Military Police Company practicing riot control.
They appear to be getting ready for those evil-doing farmers with raw
milk. I say that because I cannot see any other reason why those that
have sworn to protect the U.S. Constitution from enemies foreign and
domestic would suddenly become a goon squad. Guess orders are orders.
Now why would the Department of Injustice
want to install an embedded monitor in Sheriff Joe Arpaio’s office?
Could it because he is successfully succeeding in showing the world that
Obama is a fraud. No that can’t be it. It must be the Sheriff’s
underground alliance with those evil-doing farmers with raw milk.
As of last Saturday, gas prices on
Catalina Island have been $7.03. Although this vacation getaway is
remote from California, it is a sign of things to come.
The Swiss Franc used to be the currency
of choice for stability; however, Switzerland is expanding its balance
sheet like every other central bank. Soon, the only protection for
investors will be is to buy physical gold and silver. Keep stacking!
The good new, according to the
manipulated Department of Labor, is that the Jobless rate has gone down
to 8.2 percent. The bad news is that more have given up looking for work
amid the slower hiring. In addition, this fantasy number does not
include those with part-time jobs. Before you know it, we will be at 7.8
percent unemployment, which is what Obama came into office with. In
addition, this unemployment percentages will be very different than the
one a few years ago.
I do not believe that Colonel Sanders had
this in mind as part of his secret recipe for KFC chicken; however, it
turns out that some chicken farms are feeding banned antibiotics, and
even arsenic, to their chickens. So we have pink slime that we are told
has been removed from our beef and now we have arsenic in our chicken.
Time to become a vegetarian and only drink raw milk.
More On Housing, Gold, Etc...
Dave in Denver at The Golden Truth - 29 minutes ago
*The financial system of the United States of America is like the Titanic.
Hubris led many to declare it financially unsinkable even as its
fundamental design was riddled with fatal flaws and the human pilots in
charge ran it straight into the ice field at top speed. *- Charles Hugh
Smith, LINK
I want to post some interesting articles without too much commentary. I
hope you read them in their entirety, as they underscore some of the themes
about which I've been ranting for the past several months.
First, as has been reported by several non-mainstream media sources, China
contin... more »
Gold: I Expect The Price To Decline
Admin at Jim Rogers Blog - 1 hour ago
I expect the price to decline and when that happens I will buy more. - *in
a conference, Bucharest, last week*
Related, SPDR Gold Trust ETF (GLD)
*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.*
The Technical Underpinnings Of The Market Have Been A Disaster
Admin at Marc Faber Blog - 3 hours ago
The technical underpinnings of the market have been a disaster in the last
couple of weeks. The number of new highs have declined, the volume has been
poor, insider sales just hit a record. - *on the sidelines of the Maybank
Invest Asia conference*
Related, SPDR S&P 500 Index ETF (SPY), ProShares UltraShort S&P500 ETF (SDS)
*Marc Faber is an international investor known for his uncanny predictions
of the stock market and futures markets around the world.*
(My) Greatest Fear
Admin at Jim Rogers Blog - 3 hours ago
That I die too soon to give my daughters the help they need. - *in Guru
Focus*
*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.*
The Meaning of Made In America Has Changed
Eric De Groot at Eric De Groot - 5 hours ago
Public budgets have been decimated by today's phantom economic recovery.
Public layoffs intensified as tax revenues decreased and federal stimulus
money ran out in 2009. Public sector employment as a percentage of nonfarm
payrolls peaked 19.4% in 1975. Since the beginning of the great financial
bust in 2000, public sector employment pushed to 17.7% by 2010; A feeble
economic recovery and...
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content, and more! ]]
Killing The Fun In Sepia And B&W: Facebook To Buy Instagram For $1 Billion
Facebook has not even collected the cash from going public and it is already precommitting funds to expand growth (what's wrong with its organic growth? Not good enough) by purchasing tangential services, such as everyone's favorite photo filtering application Instagram. In other words, FB hasn't even flash dashed (or crashed - thank you BATS) yet, and it is already facing Traffic Acquisition Costs?"Spain Is Not X"... And Why That Is Actually A Bad Thing
The
place that worries Michael Cembalest, of JPMorgan, the most is Spain.
Historically, the kind of dismal position it finds itself in currently
has not ended well with 13 defaults since 1500 A.D. and he suspects its
going to take a lot of bilateral aid and ECB financing to prevent
another one.AAPL Calls: The Lottery Ticket Effect In Action?
Just last week we highlighted the behavioral bias writ large in the Mega Millions lottery via Dylan Grice's boredom discount concept. The same psychological tendency that overprices lottery tickets (relative to their expected value) seems very evident in the price action of everyone's favorite economy market tech-stock, Apple (and most specifically Apple Options).
Since the price of Apple's shares skyrocketed above $500 (around early
February), two rather significant (and very concerning) patterns have
emerged. The first is the rotation from Apple stock into options as Apple options volumes erupted
- almost tripling since the start of the year (from very stable levels
for the past few years). Call option volumes have also massively
increased relative to Put option volumes. However, while this suggests
'new' entrants lining up to buy their Apple lottery ticket, it is the
'pricing' of these options that is most worrisome as while dropping $1
on a lottery ticket will not break the retirement account - the
divergence between Apple Options volatility and the broad market's
volatility suggests a huge demand and willingness to overpay.
Volatility tends to be the cleanest way to judge demand for options and
since late January, the premium for Apple options has exploded (even as
its share price rose and rose - breaking the empirical link between
the two) as the 'optical cheapness' of Apple options compared to Apple's share price drew in the lottery ticket-buyers.
Of course this in no way points to an end to the buying of Apple
lottery tickets but the recognition of 'overpaying' - even as Apple's
share price reaches all-time highs once again and the overpayment reaches 2008 highs - will eventually slow demand for a levered bet on a new life (but as a bookie market-maker you'd be willing to take that trade bet free-money from punters every day) or maybe covered-call writers will just soak it all up again.The US Recorded Its Warmest March In History And All We Got Was This Timelapse Video
NOAA just released confirmation that the first quarter of 2012 was the warmest on record.
The fact that we rely on 'seasonal adjustments' in macro data that are
so critical in our seeming belief in the recovery of the US economy
(and its extrapolation into how many iPads will be bought next month)
when the temperature is 20% hotter than average is simply incredible.Guest Post: Ten Minutes After The Titanic Struck The Iceberg
As we all know, the "unsinkable" Titanic suffered a glancing collision with an iceberg on the night of April 14, 1912. Ten
minutes after the iceberg had opened six of the ship's 16 watertight
compartments, it was not at all apparent that the mighty vessel had been
fatally wounded, as there was no evidence of damage topside. Indeed,
some eyewitnesses reported that passengers playfully scattered the ice
left on the foredeck by the encounter. But some rudimentary calculations soon revealed the truth to the officers:
the ship was designed to survive four watertight compartments being
compromised, and could likely stay afloat if five were opened to the
sea, but not if six compartments were flooded. Water would inevitably
spill over into adjacent compartments in a domino-like fashion until the
ship sank. The financial system of the United States of America is like the Titanic.
Hubris led many to declare it financially unsinkable even as its
fundamental design was riddled with fatal flaws and the human pilots in
charge ran it straight into the ice field at top speed. We have some
time left before the ultimate fate is visible to all. Ten minutes after
the collision, the Titanic's passengers had 2 hours and 30 minutes
before the "unsinkable" ship sank. How much time we have left is
unknown, but the bow of the ship will be visibly settling into the icy
water within a year or two--and perhaps much sooner.RIP Decoupling: July 2011 - April 2012
It was NOT different this time...Union Pension Underfunding Time-Bomb Soars By 75% In One Year, Nears $400 Billion
The shortfall in US labor union pension funds is huge and growing rapidly. The latest data, from 2009, from the PBGC showed that these multi-employer plans were 48% underfunded with $331bn of assets to support $686bn of liabilities - and it has hardly been a good ride for those asset values since then. Critically, as the FT notes today, recent changes by FASB has enabled Credit Suisse to estimate shortfalls more accurately and it paints an ugly picture. The critical difference between reality and what is being reported is the ability for firms to use actuarial 'facts' to discount liabilities or compound assets at a 7.5% annual growth rate - as opposed to the sad reality of a financially repressed investing environment where returns swing from +20% to -20% in a flash forcing all funds into market timers and not long-term buy-and-hold growth players. These multi-employer pension schemes cover over 10 million people concentrated in industries with highly unionized workforces such as construction, transport, retail and hospitality but of the shortfall only $43bn lies with firms of the S&P 500 - leaving the bulk of the burden on small- and medium-sized businesses once again. It seems the number and size of unfunded (implicitly government) liabilities continues to rise or does this force pensions to follow Ben's path and increase exposure to hedge funds (which are underperforming in this serene rally so far this year) in an effort to meet these hurdle rates? Either way it appears this under-appreciated drag on the real-economy as one after another small-, medium-, and large- (Safeway faces shortfalls larger than its market cap) businesses will need to eat into earnings to fund this shortfall.
Why Normalcy Has Not Yet Arrived
We have been mis-lead first by the short term effects of the LTRO and then by the political commentary that everything had returned to normal. Hard data will show that things now are about as normal as 9/15/08, the day Lehman filed for bankruptcy... It is just not Greece and Ireland that are experiencing huge drop-offs in the M-1 money supply but Portugal -14.00%, -13.80% in Italy and Spain is quickly approaching double digit numbers. Even in developed countries the signs are worsening as the Henderson Global Investors gauge, the Real Narrow Money Supply, peaked at 5.1% in November, then dropped to 3.6% in January and was 2.1% for February. This is comparable to the declines seen in mid-2008 and so I bring this to your attention. Equally as worrisome is M-2 in the United States which fell below 1.6% last month for the first time since records have been kept in 1959.Guest Post: The Advantages Of Greenhouse Gardening For Survival
There are numerous methods for growing vibrant gardens in less than perfect weather, and growing in colder northern areas with longer winters is absolutely possible, given the gardener has some brains. In the video series below produced by The Survival Podcast, they showcase a very straightforward no nonsense experiment which proves that with a little ingenuity (and rudimentary greenhouse methods) you can indeed grow vegetables regardless of the temperature or the region in which you live.
From Bruno Iksil's Personal Profile: Enjoys "Walking Over Water" And Being "Humble"
3 Reasons Why The BoJ May Ease Within 2 Days
Tomorrow will bring the end of a two-day policy meeting at the Bank of Japan which SocGen expects will result in the announcement of additional easing measures.
Whether medium-term macro-economic issues or short-term risk tolerance
fading weighs heavier on their minds as their efforts from the
previous easing announced on Feb 14 are rapidly losing their
effectiveness - especially evident in their recent inability to restrain JPY appreciation
(which notably JPM believes will continue on the back of a disconnect
between Commitment of Traders positioning and the JPY carry divergence -
via Bloomberg's chart-of-the-day). Critically the exchange rate is a
cornerstone of BoJ policy and while risk-off will drive JPY appreciation
via carry unwinds (in a purely technical world) the political,
currency, and economic factors that SocGen lays out suggests strongly
that the BoJ (under increasing attack from politicians for its failure
to reflate the economy) will bring out yet another bazooka to show its worth - and prove this time is different even as we noted here with inflationary concerns rising.
Lastly, will JPY lose its carry-trade attractiveness and implicitly
its impact on US equities even if they do ease dramatically or when
will the market/politicians lose patience with a drip-drip-drip
approach and side with China's view of a rising devaluation risk as we noted here recently.North Korean Rocket Prepped For Take Off - Launchpad Photos And Videos
With Iran supposedly sitting down on the bargaining table for one last, soon to be failed, effort at diffusing the nuclear situation, the key geopolitical event this week will be the launch of North Korea's Unha-3 rocket, which the country insists is a peaceful launch, and the satellite contained is for scientific research. Others are not as optimistic, and Japan has already taken precautions to intercept the rocket should it get precariously close to Tokyo. Even China has cautioned against such a launch. The tentative launch window to commemorate the 100th birthday of NK founder Kim Il-Sung is set for April 12-16. So what does the rocket look like? Here it is: up close and personal.
IceCap Asset Management March Perspectives: "I Need A Job"
Since most people live in the real World, this concept of cyclical versus structural falls on deaf ears. However, it’s actually a very important concept for you to understand and it could even save you a few bucks in your portfolio. Cyclical simply means the regular ebbs and flows of a market. Think of your daily commute to work (if you have a job) – some days are longer, some are shorter but in general they are quite predictable. Structural refers to the underlying foundation and how it supports the system. For example, what happens if suddenly in the middle of the night the bridge everyone uses collapses. Suddenly your commute has become a lot more complicated and will remain complicated for a long time. In the real World, 6 million people had their bridge collapse and lost their jobs. Yet, in Mr. Bernanke’s World this cyclical inconvenience could easily be fixed simply by cutting interest rates to 0%, spending billions on “shovel ready” projects, and cutting taxes. Sadly, a funny thing didn’t happen - the usual boomerang (or cyclical) rebound in new jobs has not occurred, and for some strange reason the collapsed bridge hasn’t been replaced either. The high levels of employment reached during the 2004-2007 period were achieved on the backs of the housing and debt bubbles. During that time, economic growth was boosted by 400% as a result of people taking equity out of their homes (mortgage equity withdrawal). Considering no one has any equity left in their homes to withdraw, economic growth and the jobs that come with it are going to have to find another adrenalin shot. If you know the next big thing – feel free to share it, the World needs it.PBOC To Defer To Fed On Easing After Inflation Comes In Hotter Than Expected
Last week, when we commented on
the amusing spread between the Chinese PMI as measured by HSBC on one
hand (plunging) and the official number (soaring), we had one very
simple explanation for this divergence: "the Schrödinger paradox - where
the economy was doing better and worse at the same time - which was
experienced for the past three months in the US (and is now finished
with the economy rolling over), has shifted to Shanghai, where it is now
the PBOC's turn to baffle all with bullshit. Why? One simple reason:
despite what everyone believes, China still has residual and quite
strong pockets of inflation. So while the world may be expecting an RRR,
or even interest rate, cut any second now (just as China surprised
everyone literally house before the November the global FX swap line
expansion by the Fed in November 2011), the PBOC is just not sure it can afford the spike in inflation, or even perception thereof."
It appears we were correct, following the just released Chinese CPI
number, which in March printed at a far greater than expected 3.6%, on
expectations of a 3.4% print, and well above the February 3.2%.
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