Two
months ago, when we commented on Apple's pyrrhic courtroom victory in
which it managed to halt sales of older generation Samsung smartphones -
a "victory" which would backfire with Samsung phone sales soaring,
while AAPL results missed, forcing the company to accelerate its
product launch cadence to a ridiculous 3 months with news that the
iPhone 5s is already in the works a month after the launch of the iphone
5 - we said "The paradox here is that AAPL's victory is quite
pyrrhic: if and when Samsung feels sufficiently threatened, it
can just pull a Gazprom and halt the supply of mission critical
components to the world's biggest publicly traded company."
Naturally, the hyperbolic all out response would mean an immediate
nuclear war of attrition between the two electronics giants. Instead
Samsung would be even better served to show Apple who is boss in
quantized increments. Today, it has done just that, forcing Apple to
swallow a 20% price increase on hundreds of millions of Samsung
application processors used in iPads and iPhones. "Apple first disapproved it, but finding no replacement supplier, it accepted the (increase.)" Game, set, match Samsung.Japan's Last Remaining Nuclear Power Plant May Be Built On An Active Fault Line
Following
the disaster at the nuclear power plant in Fukushima last year, nearly
all of Japan’s reactors have been shut down. The only power plant to
remain operational today is the Oi nuclear plant in western Japan. A
geologist working as part of team looking at the power plant, its
location, and the geological history of the area, has now stated that
the power plant is built on top of a fault line that can be described
as ‘active’, and advises that it be shut down immediately. Watanabe fears that any seismic activity on this fault line could cause a catastrophe similar to the one at Fukushima; although his colleagues on the advisory panel disagree.Quote Of The Day: "That Was Not A Joke"
Question: Is the goal still to get Greece's debt to 120%?Juncker: The fact is that the target of 120% will remain, but the target as far as the time frame is concerned has been postponed to 2022.
[Laughter in the room]
Juncker: That was not a joke!
The Totally 'Normal' 2% Dump-And-Pump Silver Market
Presented without comment - but plenty of incredulity...Distribution In Lumber
Eric De Groot at Eric De Groot - 1 hour ago
Traders might want to consider a defensive lumber stance over the
short-term. Chart: Lumber (CC) And Lumber Diffusion Index (DI)
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Financial Markets: Be Careful
Admin at Jim Rogers Blog - 1 hour ago
I would be very careful. The next couple years we're going to have turmoil
and problems in most financial markets. - *in CNN *
*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.*
Why The Market Is Going To Go Down
Admin at Marc Faber Blog - 1 hour ago
I don’t think markets are going down because of Greece, I don’t think
markets are going down because of the “fiscal cliff” – because there won’t
be a fiscal cliff. The market is going down because corporate profits will
begin to disappoint, the global economy will hardly grow next year or even
contract, and that is the reason why stocks, from the highs of September of
1,470 on the S&P, will drop at least 20 percent, in my view. - *in CNBC*
Related: SPDR SP 500 ETF (SPY), iShares MSCI Emerging Markets Index ETF
(EEM);
*Marc Faber is an international investor known for his uncanny pr... more »
Institutionalizing of Liquidity/Bailouts As Public Policy
Eric De Groot at Eric De Groot - 2 hours ago
Currency induced (cost-push) inflation and crushing debt levels have lower
the standard of living for nearly all Americans. This has forced many to
survive with limited to no savings since the late 1990's (chart). The trend
of reckless consumption, however, has reversed. A new era of savings and
soon to be recognized 'prudent consumption' began in 2008. Recognition and
the pace of...
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content, and more! ]]
US Dollar on the Receiving End of Safe Haven Flows
Trader Dan at Trader Dan's Market Views - 10 hours ago
As much as it pains me to write the words, US Dollar and Safe Haven, in the
same sentence, the rush into the Dollar is evident as the fallout from the
US election, combined with fresh fears surrounding Greece and other parts
of the EuroZone continues unabated at this point.
This is perhaps one of the main reasons that the big shorts over at the
Comex have been able to thus far stymie the yellow metal near the $1740
level.
Note on the chart below that the US Dollar is working steadily higher after
having managed a strong push through a heavy resistance level near the
80.50 region. I... more »
Japan contracts in GDP by another .9%/Huge importation of gold into Hong Kong equal to 69.4 tonnes this month/Good demand for gold from India/Barrick suspends Pascua Lama temporarily due to safety issues/
Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 15 hours ago
Good
evening Ladies and Gentlemen:
Gold closed today basically unchanged at $1730.30. Silver lost 8 cents.
The bankers again were not happy with the high OI in silver so they
orchestrated another of their annoying raids. This will continue as the
regulators show no interest in stopping this criminal behaviour on the
part of the bankers. In other physical news, China reported a massiveBob Janjuah Waves Goodbye To The Greater Fool
A mere three weeks ago,
Nomura's Bob Janjuah forcefully suggested that complacency warranted a
tactical risk-off position given the misplaced confidence heading into
the plethora of event-risk ahead. It seems, 60 points later, that he
is on to something; but this time he is more critically concerned: "Investment decisions based largely on the greater fool theory
and predicated by the assumption that central bankers can sustainably
and credibly misprice money, supporting a significant misallocation of
capital, without any major negative consequences, are in general not good investments."The Strange (and Worrisome) Symmetry Of Bernanke's Bull Market
Sometimes
a picture paints a thousand words. In the case of this chart, it
paints an expectation of around 300 S&P points (to the downside).
The strange symmetrical exponentiality of the last four years can only
be marveled at in its reflection of greed and fear catalyzed by the
machinations of an increasingly impotent central banking cartel. Trade
accordingly.Wall Street Prepares For Bonus Season Pain As Comp Set To Slide
In
a shining example of the law of unintended consequences, when 2012
started Wall Street bankers had expected that all it would take for
bonuses to surge and offset 2011's deplorable comp, is another round of
QE. Well, QE came and went, not only in the US, but virtually
everywhere else, and sure enough the market traded up to new 5 year
highs (and just why of all time highs as well), yet something was not
going according to plan: bank revenues. Another side-effect of the Fed
buying the long end is everyone piling in and frontrunning Bernanke in
the 10-30 Year segment, flattening the curve, and making Net Interest
Margin profitability a thing of the past. The result has been a year in
which despite stocks rising, banker pay is set to tumble even more
(for those lucky enough to still even have a job that is, which for UBS
and Nomura means about 80% of the employees a year ago) with traders
of cash equities and derivatives set to see another 20% drop in comp
from 2011 according to Options Group. The end result: 2012 all in comp will be half of what it was in 2007. Say goodbye to the Master of the Universe - they will now have to settle for a galaxy or two at most.On The Game-Theoretic Market Crash 'Solution' To The Fiscal Cliff
We expect a return to a skittish environment in markets. We
are confident in my prediction for the course of the economy by
leveraging simple game theory in handling the upcoming crisis as
Congress returns for its lame duck session. “Compromise” reflects a
decision from either side that each find unpalatable. Both President Obama and Speaker Boehner would rather shove two sticks in their eyes than move from their hardened stance
despite some of the recent rhetoric in favor of bargaining in good
faith. As long as the loss of utility from both sides’ digging in
their heels is more favorable than conceding to the preferences from
those across the aisle, then the game arrives at a Prisoner’s Dilemma. the above matrix concludes that the
fiscal cliff virtually guarantees an aggressive selloff for equities
until the stop loss for the Democrats and Republicans has been
triggered. For example, if the clock hits midnight on New
Year’s Eve with the blue chip index at or near its September peak, each
faction would feel comfortable standing up to the other well into
January."Hot Money" At Boiling Point: Hong Kong Apartment Sells For Record $8773 Per Square Foot, New Asian Record
Over
the past year, one of the more confounding developments has been the
relentless surge higher in the Chinese currency, whose unpegged version
has soared to multi-decade highs against the USD, even as the economy
has been mired in a downward secular shift with various indicators
showing an ongoing decline. The reason for this "hot money" phenomenon
is the easy money policy adopted by all the world's central banks
(except for the PBOC of course, which is forced to stick with reverse
repo-based ultra short-term money injections), coupled with the
anti-foreign capital stance adopted by Switzerland, making China, Hong
Kong and Singapore as the go to targets for "excess global cash." And as
long as the hot money continues to flow and keep the inflation threat
"on the sidelines", all attempts to cool its notwithstanding, the PBOC
will be unable to ease, and allow US tech companies' stock prices to
finally rise, as their profitability is and has always been a reflection
of Chinese end-market demand. By the looks of things, the PBOC will be
stuck in a holding pattern for a long time, as just confirmed by the
sale of a luxury Hong-Kong 6,683 sq. foot apartment in the
Gehry-designed Opus Hong Kong in Mid-Levels East, at a price of HK$455
million, which translates to HK$68,000 per square foot, or just under
$8,800: a new all time record for Asia. So much for cooling the hot money.Living In 'The Day Before'
Markets, you see, always live in this “day before” where the bend in the highway never comes, where the path is always straight and fixed and where it is generally thought that nothing of consequence will happen.
Then some event takes place, something magical or wonderful or awful
occurs and the world is turned on its axis and nothing is ever the same
again. We are in danger, “clear and present danger” and the strategy of
the “day before” is no longer appropriate. $400 billion has
poured into bond funds this year, an all-time record, with yields at
depressed levels indicating a quite real flight to safety. The
United States lost thirty-six percent of its wealth during the
American Financial Crisis and, people or institutions, the song rolls
across the landscape, “We won’t get fooled again!”Frontrunning: November 13
- The Bild is now a source for EURUSD stop hunts: Germany eyes 'bundled' loan payment to Greece-paper (Reuters, Bloomberg)
- Congress comes back Tuesday to confront “fiscal cliff.” (Reuters)
- Gen. John Allen ensnared in Petraeus scandal (Politico)
- FBI Agent in Petraeus Case Under Scrutiny (WSJ)
- Comcast's NBCUniversal unit lays off 500 employees (Reuters)
- University Fees Stoke U.K. Inflation (WSJ)
- Consumers Closing Wallets in Japan Add to Noda’s Woes (Bloomberg)
- John McAfee Wanted for Murder... and explaining bathsalt anal suppositories (Gizmodo)
- Europe Gives Greece 2 More Years to Reach Deficit Targets (Bloomberg)
- Where Spain Is Worse Than Greece (WSJ)
- Microsoft's Windows unit head, once a possible CEO, exits (Reuters)
- Glitch stops NYSE trading in 216 companies (FT)
- Large European Banks Stash Cash (WSJ)
- The death of San Bernardino: How a vicious circle of self-interest sank California city (Reuters)
- Apple stores most productive US shops (FT)
- Treasuries See U.S. Falling Over Cliff as Yields Converge (Bloomberg)
- Bra-Bodysuits Make H&M One Hit Wonder as Zara Prospers (Bloomberg)
Overnight Sentiment: Europe Stumbles Over Itself, Again
It wouldn't be the New Normal if the basket case that is Europe, and its amusingly named "Union", didn't somehow manage to trip over itself. This is precisely what happened last night at the European finance ministers meeting after IMF head Lagarde and pathological liar and chair of the Europe's mostly broke Finance Minister, Jean-Claude Juncker, openly disagreed with each other, an event even the FT called a "feud" after they proposed two alternative visions for Greece, one which envisioned the 120% debt/GDP debt target goal pushed forward to 2022 (for Juncker), and on the other hand, IMF, which has been humiliated enough with its horrible predictions, and which refuses to budge from its 2020 Greek target. Per the FT: "In a rare breach, Mr Juncker told a post-meeting press conference the target would be moved to 2022, prompting Ms Lagarde to insist the IMF was sticking to the original timeline. When Mr Juncker again insisted it would be moved – “I’m not joking,” he said – Ms Lagarde appeared exasperated, rolling her eyes and shaking her head. “In our view, the appropriate timetable is 120 per cent by 2020,” Ms Lagarde said. “We clearly have different views.” Officials will meet again November 20 in an effort to reach agreement, Mr Juncker said. Despite the delay, officials insisted Greece would not default on Thursday, when Athens must make a debt payment of about €5bn without the benefit of international aid." Nothing like total coordination and organization within a monetary union that may not exit if Greece does not make its November 16 bond payment, which it likely will, by issuing debt and forcing the ECB to accept it as eligible collateral so that Greece can roll the maturity. And concluding this hilarious incident was Juncker's statement this morning that there is "no real dispute" with the IMF. When it gets serious...Today’s Items:
The Japanese economy shrank in the third
quarter. Japan’s Central Bank has responded with more powerful
monetary easing; such as, expanding its asset purchase program by $138.5
billion in October. Japan’s only hope, at the moment, is for overseas
economies to pick up before Japan’s own economy picks up. In short,
Japan is screwed.
The economy is getting so bad that people,
served with evictions, were committing suicide. In response, the
Spanish government has placed a 2-year moratorium on evictions.
Needless to say, people will no longer have no incentive to pay their
mortgages for the next two years and this will be a nightmare on
landowners. So what will be their plan a year from now when broke
landlords begin committing suicide? Why not just declare a moratorium
on suicides?
It is no secret that China is replacing
the U.S. dollar with its own currency in more and more of its bilateral
trading. In fact, Chinese currency may soon have equal status with
the U.S. dollar because of competitive devaluation. As more and more
nations start using other currencies, the dollar may go into the
waste-bin of history; therefore, it is best not to be in dollar
denominated assets and into something that is more long term. With
that in mind, after preparing, keep stacking physical.
Emboldened by his decisive re-election,
Obama is looking to renew budget talks and end grid lock. He wants to
avert the “Fiscal Cliff” that he signed into law.
He wants to overhaul the tax code. In short, he wants to wiggle
out of responsibility for the “Fiscal Cliff” and raise taxes on the
wealthy without cutting spending. Here is an example of how dire the
“Fiscal Cliff” is. The wealthy are dumping their assets, and selling their businessess, before the start of next year.
To no surprise, Robert Fitzwilson, joins
many others believing that last week’s election ensured that we are now
charging headlong for financial Armageddon. There is no turning
back. The voters have in effect demanded hyperinflation and
destruction of economies and currencies. In short, the voters have
repeated Julies Caesar’s own march across the Rubicon into a foreboding
future and they don’t realize it yet.
Officials at the Red Cross are claiming that their response to superstorm Sandy was flawless. Stop laughing folks, they’re serious! Despite their slow response,
with a week’s advance warning, in helping those affected by the storm,
they have successfully raised more than $85 million. To scam err…
raise that kind of money so quickly is very impressive. If they keep
this up, they will be bigger than Apple!
Make no mistake… With Apple coming out
with new versions of Iphones and Ipads every few months, the idea that
people are willing to drop their current devices and buy the latest and
greatest is beginning to have a negative feedback. There is a
difference between wanting something and needing something. Officials
at Apple simply have not conveyed the “need” part with their releases;
thus, expect Apple to begin a nose dive.
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