Bank Of Japan Goes Full Tilt, Buys Record Amount Of ETFs And REITs To Prevent Market Crash

One can call the BOJ inefficient, slow and for the most part utterly worthless, but one can certainly not accuse them of lying, and beating around the bush. Because unlike all other central banks, with the BOJ at least it has been fully public knowledge that this particular central bank unlike all others (wink wink), is actively engaged in buying equity products, among them REITs and broad equity ETFs (which provide much explicit tail-wags-dog leverage and explains why the FRBNY's red phone hotline goes directly to Citadel's ETF trading desk). And buy stocks on full tilt and in record quantities is precisely what the BOJ just did, only as one can expect, with absolutely no impact on the broader stock market. Because once even the central bank is exposed as participating in the market, the element of surprise is gone, and the central bank becomes just one mark (if one with a largish balance sheet). As MarketWatch reports, "The Bank of Japan stepped back into the stock market Monday, making its largest single-day purchase of exchange-traded funds to date... The Japanese central bank said it spent 39.7 billion yen (about $500 million) buying up stock ETFs as part of its ongoing asset-purchase program, breaking a previous record of ¥28.5 billion, set on April 16. In addition to the ETF buys, the Bank of Japan also acquired ¥2.3 billion in real-estate investment trusts Monday." Too bad that this latest outright bull in a Japan store (sic) intervention had zero impact: "the move failed to prevent a sharp fall for the Tokyo equity market." But at least they are honest. Imagine the shock and horror (and complete lack of apologies to all those who have predicted just that) when the world finally gets a trade confirm-based proof that Brian Sack was indeed buying (never selling) SPYs and ES. Why everyone would be truly shocked, SHOCKED, that the Fed is nothing but another two-bit gambler in a rigged and broken casino.

Stratfor On Europe's Growing Anti-Establishmentism

"The traditional political elites are losing control of the system they once dominated." 12 of the 17 member states of the EMU have seen their governments collapse or been voted out in the last two years. As Stratfor's Kristen Cooper notes, this is testament to the near political impossibility of implementing austerity and maintaining popular support. The tough truth is that while voters initially turn to the mainstream opposition they soon realize that they have little to offer that is different and so radical, extreme, or previously marginalized political parties will, and have done in Germany (Pirates) and Greece (Golden Dawn) already, see an increasing share of the popular anti-establishment vote and implicitly hamper any political solutions to the crisis that Europe awakens to every morning.

Be Careful What You Vote For...

All this talk of promoting growth rather than austerity misses the point entirely. Who is going to give the Greeks, or the French for that matter, the amounts of money they would need to fill the almighty hole in which they find themselves along with most of the rest of Europe, the UK and dare I say it the US? If your answer involves a central bank don’t pass Go and head straight for jail which is where the banksters and their politico/media fan club should all be anyway.

Sarkozy defeat as Hollande takes over Presidency/the bailout parties in Greece cannot form a coalition/Merkel suffers defeat in state elections/

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 5 hours ago

Good evening Ladies and Gentlemen: The price of gold faltered a bit today losing $6.10 to finish at $1638.60 at 1:30 pm est comex closing time. Silver followed the path of gold losing by 31 cents to $30.07. Today, the world reacted to a new socialist government in France.  Thus the cozy relationship between France and Germany has now evaporated. Hollande wishes to raise tax on the wealthy; lower

David Rosenberg's Take On Europe

"In less than two years, we are now up to a total of seven European leaders or ruling parties that have been forced out of office, courtesy of the spreading government debt crisis — tack on France now to Ireland, Portugal, Greece, Italy, Spain and the Netherlands. Even Germany's coalition is looking shaky in the aftermath of the faltering state election results for the CDU's (Christian Democratic Union) Free Democrat coalition partner. This is quite a potent brew — financial insolvency, economic fragility and political instability."

US Posts First Budget Surplus In 42 Months, And It Is Less Than Meets The Eye

This afternoon the CBO reported a number that in itself is quite remarkable: in April, a preliminary estimate of US receipts and outlays showed that the US Treasury posted its first budget surplus in 42 months, or since September 2008. At $58 billion, the surplus was nearly $100 billion more than the the $40 billion deficit from a year earlier. Unfortunately, while superficially this number would have been worthy of praise, digging underneath the surface as always reveals 'footnotes'. Sure enough, in the aftermath of February which saw a record US deficit of $232 billion and March's $198 billion in net outlays, there was a "catch." As the CBO admits: "This April, the Treasury realized a surplus of $58 billion, CBO estimates, in contrast with the $40 billion deficit reported for the same month last year. The results in both years were influenced by timing shifts of certain payments; adjusted for those shifts, the surplus in April 2012 would have been $27 billion, compared with a deficit of $13 billion in April 2011.... The federal government incurred a budget deficit of $721 billion in the first seven months of fiscal year 2012, $149 billion less than the shortfall reported during the same period last year. Without shifts in the timing of certain payments, however, the deficit so far this year would have been only $92 billion smaller." In other words, without various temporal adjustments, the April surplus of $58 billion would have been completely netted out by the cumulative $57 billion in deficit time shifts. However, in an election year, every beneficial item such as this is an extended talking point as the president will gladly take the praise for a number which is indicative of anything but the underlying US financial "health." After all, others can bother with the explanations.

Margin Stanley Is Back: Bank Must Post $10 Billion In Collateral In Case Of 3 Notch Downgrade

Last week it was Bank of America. This time it is the bank once again known as Margin Stanley. From the 10-Q: "In connection with certain OTC trading agreements and certain other agreements associated with the Institutional Securities business segment, the Company may be required to provide additional collateral or immediately settle any outstanding liability balances with certain counterparties in the event of a credit rating downgrade. At March 31, 2012, the following are the amounts of additional collateral, termination payments or other contractual amounts (whether in a net asset or liability position) that could be called by counterparties under the terms of such agreements in the event of a downgrade of the Company’s long-term credit rating under various scenarios: $868 million (A3 Moody’s/A- S&P); $5,177 million (Baa1 Moody’s/ BBB+ S&P); and $7,206 million (Baa2 Moody’s/BBB S&P). Also, the Company is required to pledge additional collateral to certain exchanges and clearing organizations in the event of a credit rating downgrade. At March 31, 2012, the increased collateral requirement at certain exchanges and clearing organizations under various scenarios was $160 million (A3 Moody’s/A- S&P); $1,600 million (Baa1 Moody’s/ BBB+ S&P); and $2,400 million (Baa2 Moody’s/BBB S&P)." As a reminder, on February 15 Moody's warned it’s considering downgrades of US banks and may cut Morgan Stanley as much as, you guessed it, 3 notches. Needless to say this explains why "CEO James Gorman has met with the ratings firm more often than usual in the past quarter." Net - if the firm sees a 3 notch downgrade as warned the hit will be an AIG-shudder inducing $9.6 billion, or one third of the company's market cap, and enough to leave all shareholders wishing they had exposure to Greece, and no exposure to Morgan Stanley.

Toxic Spiral: Greek Office Vacancies Soar As Tourism Industry Implodes

While the theatrics of the Greek parliamentary elections are all good and fine, keeping the masses distracted, and will most likely provide an encore performance in just about one month as no government will likely be formed under the current configuration of elected parties, the reality is that unless something drastically changes for the better in the Greek economy, the political situation will only get more and more chaotic until finally the country succumbs to outright anarchy, and possibly far worse. Unfortunately, as history has shown us, economic depressions usually become toxic death spirals where absent major external shocks, there is no hope of recovery. Sure enough, the latest news of Greece confirms just that. As Ekathimerini reports, the real news is that while superficially change may be coming to Greece, beneath the surface absolutely nothing is improving and in fact things are getting worse as measured by two key indicators: i) vacant Athens office space, which has soared to 20% in Q1 2012 compared to 15.5% a year earlier, which means far less corporate tax revenues and business spending, and ii) the lifeblood of the Greek economy - foreign tourism - is drying up, plunging by 12.5%, as foreigners suddenly have better things to do than go to countries better known for the Syntagma Square riot cam than the beaches of Santorini. Not surprisingly, the biggest source of foreign tourists, Germany, has seen its share dry to a trickle from 15% to just 3% - one can't imagine why those called Nazis by the neo-Nazis would have reservations about spending 2 weeks in the former tourist haven. The result: far less tax revenues, far greater reliance on debt as source of cash, and an economic collapse in 2012 that will put 2011 to shame. So much for the IMF estimate of an unchanged GDP print in 2013 on which the entire second Greek bailout package was based...

Graphing Groupon's Grotesque Governance And "Growth"

In case you hadn't noticed, Facebook is set to IPO very soon but, courtesy of BackgroundCheck.org, we have a breakdown of the dismal truth behind the next best thing since sliced bread - Groupon. Between their 'dodgy' growth and desperately poor governance, the SEC is showing a keen interest (or maybe just angling for a handout of IPO allocations). With a timeline from its 2007 inception through its November 2011 IPO to its recent plunge (now 70% below IPO-day highs), the events and ongoing uncertainty make for fascinating viewing.

A Market Full Of Sound And Fury Signifying Unch

Three important things occurred today: 1) US equities converged down to high-yield credit's less sanguine view of the world; 2) US equities converged to US Treasuries hope-less view of the world; and 3) Gold was the leading indicator for where risk assets should be today - as its stability was the only rock upon which to anchor expectations of intervention once again. The equity market fulfilled every technical analyst's wet dream today with a low volume gap-fill - which notably left today's VWAP at almost exactly the closing price from Friday (i.e. gave bigger players a chance to get out without losing their short - which was exemplified by the sell-off into the close on much bigger than average trade size). Never have we heard just whimsical exuberance at the market closing practically unchanged (ES +2pts) but critically risk markets in general did nothing but revert ahead of tomorrow's real action as the UK (and that means the European credit market) comes back from a long-weekend. Broadly speaking - US equities outperformed risk-assets modestly until the late-day give back dragged them back to reality but overall - IG credit underperformed, HYG outperformed (inflows dominant), and HY and S&P 500 e-mini futures (ES) stayed in sync.

The Fraud & Theft Will Continue Until Morale Improves

The entire bogus recovery is again being driven by subprime auto loans being doled out by Ally Financial (85% owned by the U.S. government) and the other criminal Wall Street banks. The Federal Reserve and our government leaders will continue to steer the country on the same course of encouraging rampant speculation, deterring savings and investment, rewarding outrageous criminal behavior, purposefully generating inflation, and lying to the average American. It will work until we reach a tipping point. Dr. Krugman thinks another $4 trillion of debt and a debt to GDP ratio of 130% should get our economy back on track. When this charade is revealed to be the greatest fraud and theft in the history of mankind, Ben and Paul better have a backup plan, because there are going to be a few angry men looking for them.
 

Reinharts And Rogoff On Why The Debt Overhang Matters

In a recent NBER paper, Ken Rogoff and Vince and Carmen Reinhart address the long-lasting consequences of high public debt loads. The authors findings are shocking to many - especially those who choose to look at 10Y Treasury rates as an indication of stress (as opposed to our earlier note on the stresses beginning to occur in the less financially repressed USA sovereign CDS market). Across 50 countries, they find 26 periods of public debt overhangs where the government has pushed gross public debt to GDP over 90% and held it there for at least five years. The stunning reality of their empirical work is four-fold: 1) the median duration of these overhang periods in 23 years (that's a lot of can-kicking); 2) real GDP growth averages 1.2% lower than trend during these overhangs; 3) real GDP drops by on average around 25% at the end of the deleveraging episode; and 4) most critically, "waiting for markets to signal a problem may be waiting too long because governments have the ability to suppress market signals." So while all the chatter of renewed growth in Europe has us ebullient with an unchanged US equity market today, the longer-term reality is - unless this time is different, there's a long and painful road ahead.

Consumer Credit Soars As US Government Encourages Student, Car Loan Bubbles

That US consumer credit soared by $21.4 billion in March on expectations of $9.8 billion rise, or the fastest monthly expansion since March 2001 would have been commendable and memorable if one did not dig through the actual components. Which sadly are atrocious: of the entire surge, a modest $5.1 billion was from real credit, or revolving, credit-card type debt. This brought the total revolving debt to $804 billion or to a level first crossed in January 2005. The balance, or $16.2 billion, was non-revolving debt, or the type of debt used to fund GM car purchases by subprime borrowers and push the student loan bubble well into its $1+ trillion record territory. The total non-revolving debt is now $1.739 trillion: an all time record. As for the source of such debt? why the US government of course, in what is the supreme ponzi scheme, whereby the US government allows US consumers to purchase Government Motors products and to keep the Higher Learning status quo in power. In other words, the US government has become the final enabler of the consumer spending bubble with proceeds used to keep the US auto unions happy (as channel stuffing is already at record high levels), and of course, to fund such ancillary student purchases as iPads. As for whether any of this debt will ever be paid off? Don't be silly.
 

Sale, theft of customer lists fuel coin fraud

by Dan Browning Star Tribune:

Sales leads move from firm to firm as salesmen take databases when they move to new jobs or start their own firms.
Dennis Helmer says he got his hands on “The List” in the 1990s, while he was working in sales at a long-defunct Twin Cities coin company called National Rarities. The database included hundreds of thousands of names and phone numbers for established gold and silver customers and others who had expressed interest in precious metals.
Read More @ Star Tribune:

HORROR: Chinese-Made Infant Flesh Capsules Seized in S. Korea

[Ed. Note: Amazing how this article does not really even touch on the ethical and moral ramifications of this horror, but rather it focuses on the "health risks". ABC News, your globalist news source.]
by Susan Donaldson James, ABC News:
The dried flesh of dead infants appears to be the not-so-secret ingredient in a health supplement that is reportedly being smuggled out of China.
The performance-enhancement pills, touted for increasing vitality and sex drive, have been found in the luggage of tourists and in international mail, according to South Korean authorities.
They said they had confiscated nearly 17,500 of the human flesh capsules since last August, according to a report in the Wall Street Journal.
South Korean authorities warned that the pills could be dangerous to human health.
“This is gross, as well as creepy,” said Dr. William Schaffner, chairman of preventive medicine at Vanderbilt University Medical Center, who consults regularly with the Centers for Disease Control.
“We have no idea how this material is processed and under what circumstances,” he said. “If it’s not done in a hygienic fashion to make assurances infections are excluded, it could contain viruses as well as bacteria.”
Read More @ ABCnews.go.com

Greek Election: The ‘Winds of Change’

by Jeff Nielson, Bullion Bulls Canada:
As Western economies and Western societies continue to deteriorate, I find myself frequently appalled but rarely surprised. Thus it was a refreshing change to be “surprised” by this weekend’s Greek election – made even better by the fact it was a pleasant surprise. The Western mainstream media had told us to expect the two rancid, Establishment parties in Greece (PASOK and New Democracy) to maintain their grip on power by circling the wagons and forming a Coalition of Convenience, to prevent the possibility of any real change. The script had seemingly been written.
PASOK and New Democracy would unite to serve the bankers and continue their Friedman Austerity: stomping on the poor and middle class to preserve the wealth and privilege of the aristocracy. As they finished the destruction of Greece’s economy they would also complete their own self-annihilation. This would have then set the stage for a real “election” in Greece (i.e. an event where “change” was an option).
Read More @ BullionBullsCanada.com

EU Bust as Internet Reformation Rolls On ..

from The Daily Bell:

Hollande wins and the end of the euro draws nearer … In France, and in Greece, the anti-austerity backlash has achieved a double victory this weekend, bringing closer the point at which the euro breaks asunder. Continued German support for the single currency relies on acceptance of the austerity imposed by the fiscal compact. Both France and Greece have now resoundingly rejected the old political consensus, making the future of the single currency more uncertain than ever. In recent days, the European Union, in seeming anticipation of these election results, has loosened its rhetoric around austerity. Olli Rehn, the European commissioner for economic affairs, has called for growth friendly austerity and insisted: “The stability and growth pact is not stupid… the pact entails considerable scope for judgment when it comes to its application.” – UK Telegraph

Dominant Social Theme: All will be well with the EU … hey, wait a minute!

Free-Market Analysis: Here at the Daily Bell one of the things we are (modestly) known for is our perspective that the Internet and the information it distributes would have a huge impact on Western government and the one-world global elite conspiracy, which thrived under the cover of darkness.
Read More @ TheDailyBell.com

Matina Stevis on Greek Elections, the Golden Dawn, and the End of an Era

from CapitalAccount:

Atlantic City’s newest novelty: Gold from a vending machine

from The Chicago Tribune:

The casino that boasts a Gold Rush theme is offering modern-day prospectors a chance to pick up some real gold and silver. No, they don’t have to pan for it in a remote mountain stream, descend deep into some dark, dank mines or rob Fort Knox.
But they will need some cash to make purchases from Atlantic City’s newest novelty, a “Gold to Go” machine. The machine made its glitzy debut at Golden Nugget Atlantic City on April 26, when the casino staged a grand opening ceremony to celebrate the completion of its $150 million renovation project.
Read More @ The Chicago Tribune

Fabulous Mogambo Essay

by Richard Daughty, mogamboguru.com:

I recently had a revelation of sorts, distilled from my merely noticing what happens when passing by my neighbors, out on their stupid lawns, playing with their stupid kids, or washing their stupid cars, or just doing something stupid. I am sure that you wonder how I can tell that they are stupid. Easy. I’ve been telling them to buy gold, silver and oil, for so long, and to such little effect, even in the face of such enormous gains accruing to those who followed such Fabulous Mogambo Advice (FMA), that one can only conclude that they are stupid or deaf.
Read More @ mogamboguru.com

The Money That Is Sold Abroad Is You!

Friends – Citizens of the World – Countrymen – LEND ME YOUR EAR Beware the Lame-Duck Congress

from ArmstrongEconomics:
It is a shame how corrupt the American Main Stream Press really is and how they refuse to tell the truth about how the government manipulates even the economic statistics. I have stated before, when we were first looking to open up offices outside the USA, I had lunch with a client who was the head of a major Swiss bank in Geneva. The names we were going to use would have been European. He asked me to name one foreign analyst. I was embarrassed since I could not. He told me then that the reason everyone used Princeton Economics was because European analysts were biased. If he was British it was God Save the Queen, as the French screamed Vive la France, and the Germany hailed the Fatherland. He said Americans were the only ones who did not care whether dollar rose or fell.
More @ ArmstrongEconomics.org

Goodbye NDAA, PATRIOT Act, Federal Reserve Act and Wars if Paul Wins Presidency

by Ruth Hull, Lew Rockwell.com:
No other Republican Presidential candidate has ever received the enthusiastic popular support in the Republican Stronghold of Orange County that Ron Paul received in his visit to Cal State University, Fullerton, on May 3rd, 2012. 6000 enthusiastic fans crowded into the Titan Stadium, which was not designed to hold 6000. The line stretched around the stadium. Seats ran out, but supporters continued to pile in, standing to see their candidate. Mitt Romney has never received that kind of support in Republican Orange County.
Once in office, Paul will repeal the NDAA, the PATRIOT Act and the Federal Reserve Act. The audience, by its standing ovations and chants showed its agreement with the plan.
Read More @ LewRockwell.com

COMEX Warehouse Silver Inventory Update 5/7/12

from Silver Doctors:

We have goose-eggs to report throughout every registered silver warehouse today, as today’s CME warehouse report shows absolutely zero silver inventory movements Friday for the first time in months!
As a strangely coincidental supply turned up in JPMorgan vaults almost simultaneously as the MFGlobal clients phyzz went missing, until the CME provides an update of what happened to this stolen inventory, The Doc will continue to provide the latest available info on this from the CME:
Read More @ SilverDoctors.com

Racing Toward the Cliff: The United States Budget Dilemma

from SilverBearCafe.com:





BTFD...

Buy the Bear

By Louis James Casey Research:

Your metals team has just returned from the Casey Research Recovery Reality Check conference in Weston, Florida. I think the quality of the speakers was perhaps the best ever. There were clever tales and insights aplenty, but I’ll cut to the chase for investors in the metals and mining sector: The correction we’ve been experiencing was discussed at length, and while no one is sure when it will bottom, legendary investors in our sector are buying now.
Read More @ CaseyResearch.com

You’re A Debt Slave and You Don’t Even Know It – Stefan Molyneux

from FinancialSurvivalNet:

All the gold and silver roads now leading to China

by Lawrence Williams, MineWeb.com

With the opening of silver futures trading in Shanghai, China could rapidly become a major player in silver trading given its position as now almost certainly being the world’s largest silver consumer.
This week the Shanghai Futures Exchange will start trading silver futures from Thursday. In a commentary on this the newspaper, The Australian, comments that nowadays all the gold and silver roads are leading to China, and speculation that the next few years could see the Chinese dominating the global silver market much as they appear to be doing with the global gold market.
Indeed a big inflow of silver into China – a country which has a long association with the metal having had a silver related currency standard up until the 1930s – is felt by some to be likely to end some of the metal’s price volatility and perhaps end what some see as excessive manipulation of the market through COMEX.
Read More @ MineWeb.com

Cartel Losing Grip: Silver Completely Retraces COMEX Open Smash

from Silver Doctors:
Silver just did what gold did last Monday: a total retrace move. Unbelievably impressive… Action like that never happened only a few years ago. The character of this market has totally changed and anyone that hasn’t put in at least 70% of their dry powder earmarked for silver while they hope for $26.70 or whatever is going to be disappointed.
Look, this is it folks. For over ten years it would have initially six months to years for silver to recover from the sort of drive-by shootings it has sustained in the last 18 months. Then, starting about early last year, silver only required a few months recovery time. Last fall’s attack and leading into December created the physical draw-down conditions (thank you stackers) such that it only took about 1 month for sustained bounces. Now, we’re down to a week to a day, to just hours.
Read More @ SilverDoctors.com

Vaccine bombshell: Baby monkeys given standard doses of popular vaccines develop autism symptoms

by Ethan A. Huff, Natural News:
If vaccines play absolutely no role in the development of childhood autism, a claim made by many medical authorities today, then why are some of the most popular vaccines commonly administered to children demonstrably causing autism in animal primates? This is the question many people are now asking after a recent study conducted by scientists at the University of Pittsburgh (UP) in Pennsylvania revealed that many of the infant monkeys given standard doses of childhood vaccines as part of the new research developed autism symptoms.
For their analysis, Laura Hewitson and her colleagues at UP conducted the type of proper safety research on typical childhood vaccination schedules that the U.S. Centers for Disease Control and Prevention (CDC) should have conducted — but never has — for such regimens. And what this brave team discovered was groundbreaking, as it completely deconstructs the mainstream myth that vaccines are safe and pose no risk of autism.
Read More @ NaturalNews.com

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