Chicago PMI Misses As Survey Respondents Warn Oil Price Shock "Tipping Point Fast Approaching"
As expected, the latest economic data point, ahead of what we now believe will be an NFP miss, the Chicago March PMI, has come and gone and it was merely the latest in a long series of misses. While the headline disappointment was modest, printing at 62.2, below expectations of 63.0 and down from 64.0, it was at the subcomponents that the pain was most acute: New Orders dropped from 69.2 to 63.3, Prices Paid soared from 65.6 to 70.1, the highest since August, any growth focusing again on inventory build up - hence hollow - from 49.6 to 57.4, the largest gain since December 2010 as the restocking continues furiously in what appears forever, but most importantly, the Employment Index which slid from 64.2 to 56.3, the biggest drop since February 2009, and virtually all job gains in 2012 have now been given up. Yet the biggest caution was not anywhere in the indices, but in one of the survey responses: "Tipping point for oil pricing and impact on raw materials and Total Cost of Operations (TCO) is fast approaching." Once the tipping point for oil comes and passes, that's the ballgame, and the only option for the Fed will be to create another Lehman-like deflationary collapse.
Time for iQE Rumors: Selloff Accelerates As Apple Drops Under $600
The S&P 500 has turned red led by Technology stocks as Apple drops below $600 once again. Chatter is the report posted here
yesterday is doing the rounds and bringing doubt to Apple's
omnipotence. Perhaps, just perhaps, it is time for the NASDAPPLE to
consider an amicable reweighing? It must be time for more iQE soon,
surely. Despite all the media propaganda, perhaps yesterday's FOXCONN
news was less than uberbullish after all.120330 - Monetizing Debt from Hyper Report on Vimeo.
Source Links for Today’s Items:
The European Central Bank Rescue Fund
rescue fund being set up will not solve the crisis. No matter how many
paper euros they put into it. When multiple socialist economies spend
far more than they bring in, is that really any surprise? The one thing
that can be counted on is when this falls apart for Europe, then the
U.S., it will be ugly. I mean so ugly that it will give Freddy Kruegger
nightmares.
Brazil will push for its large
emerging-market peers to denounce unfair monetary policies by the E.U.
and the U.S.. Of course, with the manipulated printing and scheming by
the E.U. and the U.S., they may not have to do anything but wait for the
big fall.
The system is going to implode and you
need to know and be sure of that. This September, the U.S. government
will run out of money AGAIN! Democrats in the Senate held a recess
hearing to seize private 401(k) plans to more “fairly” distribute
taxpayer-funded pensions to everyone. In short, keep stacking physical
and get out of paper.
FDIC spent almost a billion dollars on
failed banks in January of 2012 alone. FDIC contingent loss reserve
fell from $7.2 billion to $6.5 billion in the last quarter of 2011
alone. Add this to the Global Derivatives exposure, that roughly
estimated at 1,000 trillion dollars, and things are looking bad. Make
no mistake, the Federal Reserve will accelerate their printing to cover
119 trillion dollars currently in circulation. It will happen. The only
question is when.
According to a Washington Post/ABC News
poll, two-thirds of Americans are very concerned about rising gas
prices, and about half of Americans believe prices will continue to
rise. Despite the moratorium on Gulf oil drilling and other actions,
Barry err Barack Obama is still blaming Bush for gas prices.
Next…
You Don’t Have To Be A Criminal Sexual Deviant To Work For The TSA… But It Helps
http://www.infowars.com
You Don’t Have To Be A Criminal Sexual Deviant To Work For The TSA… But It Helps
http://www.infowars.com
Obama’s civilian military counterpart,
known as the TSA, appears to be made up of thieves, criminals,
pedophiles, sexual perverts, and other deviant low life scum bags.
Placing blue shirts on these waste-of-skin monsters is like placing
lipstick on a pig. No wonder there is an ongoing effort to curb their
powers. Janet Napolitano must be so proud of his pet SS force.
In 2011, the Federal Reserve purchased a
stunning 61 percent of the total net Treasury issuance. Fed
intervention in the government debt market makes demand for Treasury
bonds appear higher than it really is. Bet your glad that Sugar Daddy
Bernanke stated that the Federal Reserve will not monetize the debt.
The last month has seen a considerable
amount of the post-LTRO gains in Italian and Spanish Sovereign and
Financial credit markets (and stocks for the latter) given back.
The stigma priced into LTRO-encumbered banks has also surged to post
LTRO record wides - more than double its best levels now. This is hardly
surprising - while the LTRO was nothing but a thinly-veiled QE printfest, it is the action that was taken with that newly printed money that has created dramatially more contagion risk and sovereign-financial dependence as an unintended consequence.
The collosal (relative and absolute) size of the reach-around Sarkozy
carry-trade buying in local sovereign debt for Italy and even more so
Spain is highlighted dramatically in these 3 charts for BNP, most
notably the increase in banks' holdings of sovereign debt compared to
their share of Eurozone sovereign debt - i.e. the banks in Italy, and more so Spain, are hugely more exposed to their sovereign's performance and
with Spain's massive budget cuts - a vicious cycle of austerity to
growth-compression to credit-contraction to Greece (firewall or not) is
leaking into their bond markets, even with an active ECB doing SMP
although inflation-constrained from LTRO3 perhaps.Bullish On Myanmar
Admin at Jim Rogers Blog - 28 minutes ago
It’s right between China and India, 60 million people, massive natural
resources, agriculture,” Rogers said. You could feed much of Asia, they
have metals, they have energy, they have everything. - *in Business week*
*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.*
Taleb: How to Prevent Other Financial Crises
The Sad Reality Of Macro Data Performance
Presented
with little comment except to note that the next time someone uses the
phrase "...but the data is coming in strong..." please show this chart
as US and European macro data prints have consistently missed expectations for well over a month now...Following Greek Bond Humiliation, Europe's Biggest Equity Investor Is Slashing Its European Exposure
Remember this from September 2010? "Norway, which has amassed the world’s second-biggest sovereign wealth fund, says Greece won’t default on its debts. “The
point is, do you expect these guys to default?” said Harvinder Sian,
senior fixed-income strategist at Royal Bank of Scotland Group Plc, in
an interview. “Norway has taken the view that they will not.
The Greek holdings are particularly interesting because the consensus
in the market is that they will at some point restructure or default.”
Norway says its long-term perspective will protect it from losses. “One could say we are investing for infinity."... Uhm, Big Oops. Needless to say, this stupidity was roundly mocked by Zero Hedge at the time.
Yet we can only applaud the fact that unlike other European investors
(read primarily Italian banks) which are merely sinking ever deeper
into the quicksand by dodecatupling down on pyramid scheme assets, the
Norwegian SWF finally "plans to sharply reduce its European
exposure while raising investments in emerging markets and Asia-Pacific,
the finance ministry said on Friday." While we ridiculed
their stupidity in 2010, we applaud Norway's prudence in this case, as
unlike other insolvent European entities, the crude-rich country is not
falling for the latest round of central planning bullshit, and is
finally acting as a fiduciary agent. "We're reducing our
European exposure because we see that economic development in the global
economy is changing and this should also be reflected in our
investment strategy," Johnsen said. "Most likely we'll have to sell some assets in Europe."
Remember: in game theory he who defects first, defects best. We expect
to see many more funds openly declaring they will commence dumping
European assets, all of which are buoyed 100% artificially by the ECB,
and US taxpayers, shortly.
Don't Be (April) Fooled: New ETF Money Flows Still Bond-Bound
With
the first quarter of 2012 just about in the books, Nic Colas (of
ConvergEx) looks at how the Exchange Traded Fund 'Class of 2012' has
done in terms of asset raising to date. There have been 82 new ETFs
listed thus far for the year and they have collectively gathered $1.1
billion in new assets through Wednesday’s close of business. While 63%
of those funds have been equity-focused, fully 67% of the asset growth for the year has flowed into fixed income products. Just over half the total money invested in these new funds has had two destinations: the iShares Barclays U.S. Treasury Bond Fund (symbol GOVT, with $297 million in flows) and Pimco’s Total Return ETF (symbol TRXT,
with $267 million in flows). The standout new equity funds of 2012 in
terms of flows are all iShares products – Global Gold Miners (symbol:
RING), India Index (symbol: INDA) and World Index (symbol: URTH). Bottom
line: even with the continuous innovations of the ETF space, investors
are still targeting international and fixed income exposure, a continuation of last year’s risk-averse trends and
while 'ETFs destabilize markets' might be the prevailing group-think,
this quarter’s money flows into newly launched exchange traded products
reveals a strong 'Risk Off' investment bias. Interestingly, the correlation between inception-to-date performance and money flows is essentially zero.American Spending Goes Into Overdrive As Savings Plunge To 2008 Levels
Why
save when one can spend (and, more importantly, why save when one has
ZIRP)? This appears to have been the motto of American consumers in the
past three months when the US Savings rate has plunged from 4.7% in December to a tiny 3.7% in February:
the lowest since December 2007's 2.6%, and just as the recession and
the market crash was about to send everyone scrambling for the safety of
bank savings. The reason: in February personal spending soared
by 0.8% on expectations of a 0.6% rise, while incomes barely rose by
0.2% on a consensus rise of 0.4%. Which means the balance had to be
savings funded. So even as we have seen retail weakness in the past
three months, we now know that it was not only credit funded, but also
forced US consumers to burn through their meager savings. And all this before the
gasoline price shock hit. The question then is: with the remainder of
US savings about to be tapped out on gasoline purchases, just where
will the money come to fund all those priced in NEW iPad acquisitions?
Or will Apple finally use up its cash hoard and start a captive lending
unit, giving consumers credit to purchase its products? At the rate
the US consumer is going broke it may soon have no other option.Visualizing The Fed's Clogged Plumbing
In advance of ever louder demands for more, more, more NEWER QE-LTROs (as BofA's Michael Hanson says "If our forecast of a one-handle on H2 growth is realized, then we would expect the Fed to step in with additional easing, in the form of QE3") , it is an opportune time to demonstrate just what the traditional monetary "plumbing" mechanisms at the discretion of the Fed are, and more importantly, just how completely plugged they are. So without any further ado...
Daily US Opening News And Market Re-Cap: March 30
European markets got off to a bad start following early reports that the Greek PM has not ruled out a further aid package for the country, however European cash equities are now trading higher as US participants come to market. Markets have been reacting to the announcement from EU’s Juncker that the Eurogroup has agreed upon Eurozone bailout funds of EUR 800bln. Elsewhere in the session, FPC member Clark commented that the FPC should not aim to stimulate credit growth in the UK, adding that direct intervention in the mortgage market is too politically volatile, but may be considered in the coming years. Following the reports, GBP/USD spiked lower around 15 pips, however it remains in positive territory, moving above the 1.6000 level in recent trade. In terms of data, the Eurozone CPI estimate for March came in just above expectations at 2.6%, 0.1% above the 2.5% consensus. The market reaction to this data, however, was relatively muted as participants await Eurogroup commentary. Looking ahead in the session, participants await commentary on the Spanish budget, US Personal Spending and Canadian GDP.The Full Math Behind The "Expanded" European Bailout Fund
As
noted earlier, futures this morning are higher despite a plethora of
economic misses (and despite 57% of March US data missing as per DB),
simply on regurgitated headlines of an "expanded" European €7/800
billion bailout fund. There is one problem with this: the headlines are
all wrong, as none apparently have taken the time to do the math.
Which, courtesy of think tank OpenEurope, is as follows: "The real amount of cash that is still available to back stop struggling states, should it come to that, is only around €500bn."
Of course, that would hardly be headline inspiring: recall that that
is simply the full size of the ESM as is. But even that number will
hardly ever be attained, and the ECB will have to step in long before
Europe needs anything close to a full drawdown: "The problem here is
that if it’s too big and terrible to ever be used, it’s likely that it
won’t ever be used. Even jittery markets will be able to figure out
that a large fund which would damage French and German credit ratings
if ever extended will never be fully tapped. So clearly some circular logic at play. And
let's not forget that it’s still far too small to save Italy and
Spain should if worse come to worse." Circular logic? Check. Another
check kiting scheme? Check. Spain and Italy still out in the cold?
Check. Conclusion -> buy EURUSD, and thus the ES, which has now
recoupled with every uptick in the pair, but not downtick.
RANsquawk: US Morning Call - Chicago PMI Preview: 30/03/12
Submitted by RANSquawk Video on 03/30/2012 - 07:50 Chicago PMI RANSquawkGold Rises And Silver Surges In Q1 2012 - Fiat Currency Devaluation Continues
Gold has been trading in a tight box around $1,660/oz today, as eurozone finance ministers meet in Copenhagen to discuss the scale of the permanent “bailout fund” set for July. Gold has been stuck in range of roughly $1,630/oz to $1,700/oz in recent weeks as risk appetite has returned after the latest European debt “solution” which saw the battered can kicked down the shortening road once again. Nothing has been solved with regard to the European debt crisis, and debt crises in Japan, the UK and the US now loom. The misguided panacea of heaping debt upon debt and shifting debt onto government balance sheets, debt monetisation and currency debasement is leading to continuing currency devaluations internationally. Despite this or maybe because of this - risk appetite returned with a vengeance as evidenced in equities internationally rising to multi-month and multi-year highs and the slight weakness in gold in March. So far in 2012, gold has performed well and is set to end the first quarter in 2012 with gains in all major currencies. Gold is 6.3% higher in US dollars, 3.2% higher in euros, 3.1% higher in pounds, 2.25% higher in Swiss francs and 12% higher in Japanese yen which fell sharply in the quarter.
Frontrunning: March 30
- Greek PM does not rule out new bailout package (Reuters)
- Euro zone agrees temporary boost to rescue capacity (Reuters)
- Madrid Commits to Reforms Despite Strike (FT)
- China PBOC: To Keep Reasonable Social Financing, Prudent Monetary Policy In 2012 (WSJ)
- Germany Launches Strategy to Counter ECB Largesse (Telegraph)
- Iran Sanctions Fuel 'Junk for Oil' Barter With China, India (Bloomberg)
- BRICS Nations Threaten IMF Funding (FT)
- Bernanke Optimistic on Long-Term Economic Growth (AP)
Overnight Sentiment: Positive Despite Barrage Of Misses, On More Bailout Promises
A bevy of economic data misses overnight, including German and UK retail sales, Japan industrial production, UK consumer confidence, and a European economy which is overheating more than expected (2.6% vs 2.5% exp, although with $10/gas this is hardly surprising), and futures are naturally green. The reason: the broken record that is the European FinMins who are now redirecting attention from the slowly fading LTRO impact to the good old standby EFSFESM, which according to a statement by de Jager has now been agreed on at €800 billion, lower than last week's preliminary expectation for €940 billion in joint firepower. That this is nothing but a headline grabber is as we have noted before, as there is much doublecounting, capital allocation to and by the PIIGS as well as funding already assigned. It will likely take stocks some time before the realization dawns that this is not new capital and liquidity entering the markets, unlike QE on either side of the Atlantic, while the amount is largely inadequate to fill the multi-trillion liquidity shortfall, let alone "solvency" of European sovereigns and banks. So for now enjoy the greenness all around.Charles Hugh Smith On The Phony "Economic Recovery," Stress and "Losing It"
Everyday Stress Can Shut Down the Brain's Chief Command Center. Neural circuits responsible for conscious self-control are highly vulnerable to even mild stress. When they shut down, primal impulses go unchecked and mental paralysis sets in. (Scientific American; subscription required, hopefully your local library has a copy) This helps explain the natural "fight or flight" response we feel when suddenly confronted with danger or potential danger, but more importantly it illuminates how we lose the ability to analyze circumstances rationally when we are "stressed out." Once our rational analytic abilities are shut down, we are prone to making a series of ill-informed and rash decisions. This has the potential to set up a destructive positive feedback loop: the more stressed out we become, the lower the quality of our decision-making, which then generates poor results that then stress us out even more, further degrading our already-impaired rational processes. This feedback loop quickly leads to "losing it completely." Doesn't this describe our increasingly dysfunctional and disconnected-from-reality legislative process?
[Ed. Note:
How is this blatant tyranny not a line in the sand for the American
people? This is all part of the UN's Agenda 21 enslavement strategy.]
by Jonathan Benson, Natural News:
As many NaturalNews readers now know, the state of Michigan’s Department of Natural Resources
(DNR) recently issued a final ruling on its invasive species order
(ISO) for swine that targets destructive “feral” species for elimination
across the state. But what many people do not realize is that because
of the careless way in which the order was created, all unconventional
pig breeds, including heritage breeds raised by small-scale farms, are
also lumped into this “feral” category as well.
Contrary to some of the claims currently spreading across the internet elsewhere, DNR’s ISO does not simply target feral breeds responsible for destroying crops and forests. As we pointed out in a recent article on the matter, the ISO brands certain hair colors, fur types, tail and skeletal structures, and various other characteristics as being indicators of a feral breed, even though these descriptors also identify many heritage breeds that have been raised in Michigan for many decades (http://www.naturalnews.com/035372_Michigan_pigs_farm_freedom.html).
In other words, there is nothing sensational or overblown about the claims made that the state of Michigan has basically declared war on all pig breeds besides the select few raised by large-scale factory farms. The DNR’s approach to the situation is beyond misguided — it is a blatantly-unscientific assault on small-scale pig farmers across the state of Michigan, many of which face being completely put out of business.
Read More @ NaturalNews.com
by Jonathan Benson, Natural News:
As many NaturalNews readers now know, the state of Michigan’s Department of Natural Resources
(DNR) recently issued a final ruling on its invasive species order
(ISO) for swine that targets destructive “feral” species for elimination
across the state. But what many people do not realize is that because
of the careless way in which the order was created, all unconventional
pig breeds, including heritage breeds raised by small-scale farms, are
also lumped into this “feral” category as well.Contrary to some of the claims currently spreading across the internet elsewhere, DNR’s ISO does not simply target feral breeds responsible for destroying crops and forests. As we pointed out in a recent article on the matter, the ISO brands certain hair colors, fur types, tail and skeletal structures, and various other characteristics as being indicators of a feral breed, even though these descriptors also identify many heritage breeds that have been raised in Michigan for many decades (http://www.naturalnews.com/035372_Michigan_pigs_farm_freedom.html).
In other words, there is nothing sensational or overblown about the claims made that the state of Michigan has basically declared war on all pig breeds besides the select few raised by large-scale factory farms. The DNR’s approach to the situation is beyond misguided — it is a blatantly-unscientific assault on small-scale pig farmers across the state of Michigan, many of which face being completely put out of business.
Read More @ NaturalNews.com
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David McWilliams (of 
The
lecture series is complete and Ben can creep back behind the green
curtain once again. Today's lecture focused on the aftermath of the
crisis and a quick summary of just where Bernanke believes the recovery lies - Fed 95: Government 11.
Unfortunately the word 'Progress' only appears once. When we asked
Wordle to consider the speech, it gave us back what appeared to be a
deus-ex-machina created tear-drop shape - somewhat
ironic perhaps. Interestingly the words 'Credit Backs Just Markets' were
at the very top of the pyramid and that led to the 'Financial Economy'
making it clear just what is going on here. In an echo back to the
last lecture on the crisis itself, there is some subliminal messaging
with the phrase 'Mortgage Regulators Housing Crisis' appearing spookily close together. Rest assured though, Ben is not entirely self-aggrandizing as he used the word 'tool' a magnificent 30 times. Full presentation embedded in all its glory.
We 
Presented
with little comment except to note the incredible 29 year-long
projection of the mid-80s trend-line (on the log-scale chart of AAPL
share price) perhaps offers some resistance and the corrective 'echoes'
that have occurred at these inflections before.
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