-
Government Gross Financing Needs
totally fantasy economy. How are they going to get money to pay for all those debt? Invading africa and steal all their oil and minerals? I sure as heck don't see how the economy is going to produce so much surplus to pay for government debt.
-
Apple Cash Hits $110 Billion, Up $12.6 Billion
If there is anything at all less than superlative that can be said about
Apple's consolidated cash hoard, which grew by $12.6 billion in the
quarter and double from a year earlier, is that it is a tad less
exponentially than before. Still, not bad: the country's cash stash is
nearly enough to cover the first Greek bailout (will need to wait 2 more
quarter for it to be sufficient to pay for the fifth one).http://www.zerohedge.com/news/apple-cash-hits-110-billion-126-billion
All their contracts are in dollar, if the taiwanese and chinese start asking yuan, all those apple dollar isn't going to worth anything. What they gonna do? building factory with 120K worker in Texarkana somewhere? how are they going to feed that many workers? And what about rare earth?
-
pssst, mister biderman..
here is the dirty secret
a) military spending. all those expensive mad in US military gear? first to go from the budget (F-35, missile defense, NATo in afghanistan, israel war) This is big part of european budget. (see netherland, belgium, UK.) Teh biggest welfare recipient in the world is US military industrial complex. This on top of a lot of non compete clause. (If the european start offering competing product, 1/3 of US industry, the entire US military will collapse.) This is the only US products that still sells without much competition these days.
b) europe has much better relationship with middle east. (once european says fuck all this yankee redneck zionist war in middle east. we are getting our cheap oil from middle east. Palestinian independent, and Russia is our friend. Overnight.european energy crisis go away. this on top of them exporting weapons and industrial gear to entire arab world who is pretty much have had it with US israel policy.
c) Europe has much better relationship with asia. (the possibility of asian bank bail out is not a fantasy. you think china is going to bail out next wall street crash without massive market opening? good luck)
..so be careful what you are saying, if europe wake up one day and decide fuck this, we are realigning our geopolitics... guess who the idiots who left holding the bag? Dollar. -
ps. not everybody in the world can turn japanese, that's what japanese are there for. if everybody debase currency at same rate, then ultimately it will come down to actual "productivity"... consider race to debase currency and ever increasing productivity output... we are talking about japanese car industry, consumer electronic, crazy population density (greatly reduced transportation cost), long work hour, etc ...
you really think latvian will win industrial competition against kanto area? ...
I for one don't see any political willingness to restructure global financial institutions. It will be more of the same. extent and pretend, until next big crash. It'll be competitive debasement galore, then big trade war, followed by real war. WWI-WWII style geopolitical rearrangement.
whatever it is, a big crash is a virtual guarantee now. -
In a statement to
The Harvard Crimson -- Harvard's university newspaper -- the 24-year-old
broke his weeks-long silence and attempted to address questions about
how his parents managed to fund his prestigious education overseas.
"My
tuition and living expenses at Harrow School, University of Oxford and
Harvard University were funded exclusively by two sources --
scholarships earned independently, and my mother's generosity from the
savings she earned from her years as a successful lawyer and writer," he
wrote.
Gu is currently under investigation in China for the
suspected murder of British national Neil Heywood, who reportedly
facilitated Bo Guagua's entry into Britain's exclusive Harrow School.
Bo
Xilai, meanwhile, was sacked from his post as boss of Chongqing city
last month and then suspended from the Communist Party's hugely
powerful, 25-member Politburo for "serious discipline violations" --
code in China for graft.
http://www.channelnewsasia.com/stories/afp_asiapacific/view/1197302/1/.html
political asylum time? ... my shiny dime bet.
-
The
Beebster can talk himself blue in the face about this but, in fact,
this is a major economic and diplomatic blow to Israel's future welfare.The fact that this has occurred BEFORE the Islamist and basically anti-Israeli forces in Egypt are fully empowered is ominous.
IMO it is only a matter of time before the Egyptians withdraw from the treaty of peace with Israel. pl
turcopolier.typepad.com/sic_semper_tyrannis/2012/04/httpabcnewsgocombusinesswirestoryegypt-terminates-gas-deal-israel-16190708.html#comments
that much is obvious. 5 yrs...maybe less. Next big diplomatic implosion is the collapse of house of saud. It'll take a miracle to maintain current status quo longer than a decade.
-
"The big buyers out of China are government-owned entities and
therefore, when the Government moves to really internationalise the
currency they will mandate that their own subsidiaries only accept RMB.
"That will be an incentive [to settle in RMB] in the way that
only a structured environment like China can provide," Henry said.
"Don't underestimate how determined the PBOC are to make this happen"
she said, adding that HSBC is aware of conversations involving global
commodity exporters to "gauge comfort levels" with swapping to RMB
settlement.
The benefits for New Zealand firms as RMB settlement becomes easier
include the ability to negotiate better terms with Chinese partners (up
to 7 per cent may be built into quotes as a currency hedge), potentially
widening the customer pool, and reducing fx hedge risks associated with
having to convert back and forth into the US dollars traditionally used
for trade with China.
The challenges are understanding how the RMB settlement procedure works,
making sure the paperwork is correct, and taking a leap into the
unknown to become part of a fast-moving and changeable area.
The RMB Cross-Border Trade Settlement Pilot Scheme, which opened up the
previously highly-controlled RMB to offshore settlements, began in July
2009 and has expanded faster than expected ever since. Now, any overseas
entity can settle trade invoices in RMB, as can any Chinese entity
except those on a soon-to-be-published blacklist.http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10796452
7%? that's huge advantage.
-
Japan to try to convince U.S. on IMF reforms: Azumi
TOKYO (Kyodo) -- Japan will keep calling on the
United States to accept a 2010 agreement for the International Monetary
Fund to implement governance reforms, a deal which will help enhance the
voices of emerging economies within the multilateral lender, Finance
Minister Jun Azumi said Tuesday.
But Azumi also told reporters that he understands
it is difficult for the U.S. government, the biggest stakeholder in the
IMF, followed by Japan, to make any politically sensitive decision
ahead of the U.S. presidential election later this year.
''We will try to convince the United States,''
Azumi said. Tokyo will host the annual meetings of the 188-member IMF
and its sister organization, the World Bank, in October, where the
reform issue will be high on the agenda.http://mainichi.jp/english/english/newsselect/news/20120424p2g00m0bu084000c.html
oh please... not gonna happen.
-
3. A best in class risk technique that stop losses the narrative and
responds early with loss mitigation procedures (i.e. a method of staying
solvent, rational and disciplined under pressure).I have always figured that the first is the real key. That success
was simply a matter of contentious macro posturing. In other words,
going long very rich risk premium or buying cheap stuff. It is my
assertion that what makes a great fund manager first and foremost is the
ability to establish a contentious premise outside the existing belief
system and have it go on to become adopted by the broader financial
community. Bruce Kovner expressed the idea more eloquently when he said,
“I have the ability to imagine configurations of the world different
from today and really believe it can happen. I can imagine...that the
dollar can fall to 100 yen”. I am sure you are nodding in agreement,
except Bruce was saying this when the USDJPY was well over 200, not
today's rate of 80!That is the kind of guy I want to be when I grow up. Recall that I
have the kind of imagination that can conceive of the yen trading closer
to 60. Similarly, if we look back and reminisce about previous years,
the Fund's 50% return in 2003 was derived from a legitimate but
certainly contentious view that China's WTO entry was set to boost the
cyclical "old" economy of the West and that fiat hyper-management of the
financial economy could propel gold into a super bull market. To think
these views were once contentious; plus ça change!http://www.zerohedge.com/news/hugh-hendry-back-full-eclectica-letter
1. yen can only go up without active intervention of BOJ. Japan is not some cripple european PIGS banana republics like Ireland or Latvia. At the same time, their modern economy is strictly built on export machine. But its industrial base is intake, as shown how they survive the last earthquake. The country's industrial bureaucracy works like a clock. Yes, this include the nuke blow up. The fact that japan can make the fifth largest earthquake in history looks like just another messy natural disaster is mind boggling to me. If it happens at any other place it'll be total collapse, Haiti style.
The so called smart european bankers can't even survive the chain reaction of US sub prime collapse.
2. at 100 Yen, US car industry will be destroyed period. at 120 anything made out of steel and run on electricity will be pwnd by japanese. at 200, nothing survives. Even Boeing will move to Japan to make their jet. (I am not sure what kind of crack this hugh guy is smoking. But he should actually see how things are made instead of walking around in chinese city wearing "fund manager" glasses.
20 micro second buy/sell decision does not make real long term national wealth. What is the big deal about factory over investment? this as oppose to paper asset bubble. When things exploded, guess who still have "machines" to get back producing, as oppose to paper asset gone?
Guess who will move forward and bring price even lower while everybody goes bankrupt? Price of polysilicone, aluminum and steel would be great example. Guess who will control the future of all industry based on those raw materials?
Carnegie didn't get rich by hussling as "fund" manager. He did exactly what the chinese is doing right now.
-
BEIJING: China is considering sovereign guarantees
for its ships to enable the world's second-biggest oil consumer to
continue importing Iranian crude after new EU sanctions come into effect
in July, the head of China's shipowners' association said.
Tough new European Union
sanctions aimed at stopping Iran's oil exports to Europe also ban EU
insurers and reinsurers from covering tankers carrying Iranian crude
anywhere in the world. Around 90 percent of the world's tanker insurance
is based in the West, so the measures threaten shipments to Iran's top
Asian buyers China, India, Japan and South Korea.
Global crude oil prices have risen nearly 20 percent since October, partly on fears over supply disruptions from Iran.
"(Ship) operators are worried that if the insurance issue cannot be
resolved, they will not be able to take orders for shipping Iranian oil
any longer," Zhang Shouguo, secretary general of China Shipowners'
Association, told Reuters in a rare interview with foreign media.
http://economictimes.indiatimes.com/news/international-business/china-mulls-sovereign-guarantees-for-ships-carrying-iran-oil/articleshow/12932959.cms
Shipping insurance is one of the original "easy" money (Llyod, anybody?) I can only imagine the amount of money china is going to make from shipping insurance. Is not like they don't have submarine and ICBM to backed their merchant shipping line.
biggest losers: European banks. (why stop at oil tanker? move every single insurance from europe too...) What they gonna do? stop shipping route from asia?
-
Lloyd's of London
Formation
The market began in Lloyd's Coffee House, opened by Edward Lloyd
around 1688 in Tower Street, London. This establishment was a popular
place for sailors, merchants, and ship owners, and Lloyd catered to them
with reliable shipping news. The shipping industry community frequented
the place to discuss insurance deals among themselves. Just after
Christmas 1691, the coffee shop relocated to Lombard Street (a blue plaque
commemorates this location). This arrangement carried on until 1774,
long after Lloyd's death in 1713, when the participating members of the
insurance arrangement formed a committee and moved to the Royal Exchange on Cornhill as The Society of Lloyd's. -
Global food price rise on costlier oil-World Bank
Global food prices rose in
the first four months of 2012, pushed higher by volatile world
oil prices, strong demand for food imports from Asia and adverse
weather conditions in parts of Europe, South America and United
States, the World Bank said on Wednesday.The latest World Bank food price index shows the cost of
food increased by eight percent between December and March, just
6 percent below their February 2011 historical peak.The poverty-fighting institution said the prices of all key
staple foods rose over the four-month period except for rice. It
said abundant supplies of rice and strong competition among
exporters pushed the international rice price lower.http://www.reuters.com/article/2012/04/25/worldbank-food-idUSL2E8FP40020120425
total insanity. countdown until bunch of regime changes...This time in europe.
-
Charting soybean prices - no hedonic adjustments here.
What is the reason for the dramatic surge in prices?
Soyabean prices have risen more than 10 per cent in the past month to
hit a peak of $15.09 a bushel on Friday, the highest in four years.
Other sources of edible oil, including rapeseed and canola, have also
reached levels last seen during the 2007-08 food crisis.http://www.zerohedge.com/news/another-bout-global-food-inflation-just-around-corner
-
US Factory Orders Post Biggest Decline Since March 2009
That March factory orders declined 1.5% was not very surprising: the
market was expecting a decline of 1.6%. However, this is not good news
as the prior February increase of 1.3% was revised lower to 1.1%,
netting out as a negative two month change. Where this number was
troubling is that this 2.6% swing brought the index to its biggest
decline since March 2009 when the pumping of trillions started.
http://www.zerohedge.com/news/us-factory-orders-post-biggest-decline-march-2009
The effect on that "gasoline spike" from iran embargo start to take a bite. Few months from now, people gonna cry..."why another Lehman"... If there is just one explosion in european refinery or a ship getting so much as a scratch in the gulf.... prepare for massive "bubble" popping...
Instagram will not worth $1Billion, I can tell you that.
I guess now it's the time to take inventory of all:
a) wishful thinking, super bubble, we can make it whole again, if price keep going up just a little more sector.
b) insanely leveraged asset, institutions
c) hedge on commodity, or anything that crosses "dollar-euro-asian curreincies" they are not going to be able to pay.
d) The day of reckoning for all too big too fail banks.. European first, then bananas like well fargo, bofa.
e) all weak industries that depends on long term loan, long term mortgage, new loan, debt, etc...will die.
f) pray the chinese and japanese are in kind mood and not pulling all their asset at the same time while things are imploding.
g) pray Israelis are actually afraid of gas chambers and extermination if they instigate yet one more global economic collapse and major regional war.
h) pray the iranian isn't coordinating their attack to trigger the biggest Euro-Dollar zone collapse, because whatever they are doing is working nicely.
To put it simply...there are too many fragile parts that will quickly lead to total collapse.
-
Europe's Scariest Chart Just Got Scarier-er
The Euro-zone youth unemployment rate is back over 22% for the first time since September 1994. With Spain and Greece over 50% (and rising) and Italy now joining Ireland over 35% at the same time as Germany's youth unemployment falls below 8% for the first time since May 1993 - one can only surmise the rising tensions between the haves and the have-nots (even as Germany's PMI disappoints).
For comparison, the US is not exactly sunshine and roses, with 16-17
year-olds back near 30% unemployment and 18-19 year-olds back over 22% -
even as 20-22 year-olds improve gradually.
http://www.zerohedge.com/news/europes-scariest-chart-just-got-scarier-er
-
ADP Misses Big, Prints Lowest Increase Since September; Manufacturing Jobs Post Shocking Decline
http://www.zerohedge.com/news/adp-misses-big-prints-lowest-increase-september-manufacturing-jobs-post-shocking-declineSomewhere in whitehouse compound, somebody is curling at the office corner and see how the economy is about to implode globally. And wish they didn't pull idiotic oil move. Too late now... The avalanche has started.
-
European Unemployment Rate Rises to Highest in Almost 15 Years (Bloomberg)
Eurosis Is Back With A Bang: PMIs Collapse, Unemployment Surges To Record
http://www.zerohedge.com/news/eurosis-back-bang-pmis-collapse-unemployment-surges-record
count down till the european once agains chanting 'Juden raus'
-
www.defencetalk.com/forums/air-force-aviation/f22-deployment-middle-east-11910/
F22 Deployment in Middle East
Any
reliable intelligence on this may be hard to find, but the key question
must be is it simply to send a signal to the Iranians about the need to
take the next round of talks seriously? I can't imagine that the US
deploying it' newest prize weaponry is routine.
Very interesting development if true but I always take RT reports with a
pinch of salt; as a news media the slant against US motives indicates
that the are biased. On ABC
News the Blotter, all over the news, I guess I wonder why anyone would
doubt that is true, seeing that Iran deploys very sophisticated Russian
A2G, and the F-22 remains and will remain the only aircraft designed to
operate in that Hostile environment, at present and in the near future.
Are you sure we don't have that posted on our sight? You are right,
there is no reliable intell right now, because of the sensitive nature
of that mission, but they are being based at UAE.
-
Black–Scholes
Espen Gaarder Haug and Nassim Nicholas Taleb
argue that the Black–Scholes model merely recast existing widely used
models in terms of practically impossible "dynamic hedging" rather than
"risk," to make them more compatible with mainstream neoclassical economic theory.[12] Similar arguments were made in an earlier paper by Emanuel Derman and Nassim Taleb.[13] In response, Paul Wilmott has defended the model.[9]Jean-Philippe Bouchaud argues: Reliance on models based on incorrect axioms has clear and large effects. The Black–Scholes model,[14]
for example, which was invented in 1973 to price options, is still used
extensively. But it assumes that the probability of extreme price
changes is negligible, when in reality, stock prices are much jerkier
than this. Unwarranted use of the model spiralled into the worldwide
October 1987 crash; the Dow Jones index dropped 23% in a single day,
dwarfing recent market hiccups.[citation needed] Using the Student's t-distribution in place of the normal distribution as basis for the valuation of options can better take in account extreme events. -
Total US Debt Soars To 101.5% Of GDP
And for those who still believe that insurmanoutable debt is suicide, we have good news, you are right, at least according to a new paper by Reinhart, Rogoff and Reinhart (via The American):
– We identify 26 episodes of public debt overhang–where debt to GDP
ratios exceed 90% of GDP–since 1800. We find that in 23 of these 26
episodes, individual countries experienced lower growth than the
average of other years. Across all 26 episodes, growth is lower by an average of 1.2%.– If this effect sounds modest, consider that the average duration of debt overhang episodes was 23 years. In 11 of the 26 high debt overhang episodes, real interest rates were the same or lower than in other periods.
– Obviously, it is possible that new developments in technology and
globalization will provide such a remarkable reservoir of growth that
today’s record debt burdens will eventually prove quite manageable. On
the other hand, the fact many countries are facing “quadruple debt
overhang problems”—public, private, external, and pension–suggests the
problem could in fact be worse than in the past, a question we do not tackle here.– Nor have we paid attention here to the likely possibility of
significant “hidden debts”, especially public sector, which Reinhart and
Rogoff (2009) find to be a significant factor in many debt crises, and
as documented in detail in the Reinhart (2010) chartbook. Another line
of reasoning for dismissing concerns about public debt and growth is
the view the causality mostly runs from growth to debt.– Our analysis, based on these cases and the 23 others we identify, suggests that the long term risks of high debt are real.
-
NBER's Martin Feldstein Bashes The Deplorable US Economy, Says Bernanke Has Engineered Another Stock Bubble
Feldstein on the U.S. economy:
"We are not doing very well. The economy is just
coming along at a snail's pace. The first quarter numbers that we just
got last week were not very good at all. The GDP number was 2.2%. That
was a disappointment, but you know, it was all automobiles. 1.6 out of
the 2.2 was motor vehicle production. So, people were catching up after
not being able to buy them the year before. So, this is a very weak
economy. The payroll employment numbers, we are going to get some new
ones in April. Let's hope they are better than March where it fell by
half. The stock market is, I think, responding to the Fed. I
think the real danger is that this is a bubble in the stock market
created by low long-term interest rates that the Fed has engineered."On the danger of a bubble in the stock market:
"The danger is, like all bubbles, they burst at some point.
Remember, Ben Bernanke told us in the summer of 2010 that he was going
to do QE2 and then ultimately they did Operation Twist. The purpose of
that was to make long-term bonds less attractive so that investors would
buy into the stock market. That would raise wealth and higher wealth would lead to more consumption.
It helped in the fourth quarter of 2010 and maybe that is what is
helping to drive consumption during the first quarter of this year. But
the danger is you get a market that is not with the reality of what is
happening in the economy, which is, as I said a moment ago, is really
not very good at all."Hey Einstein...forget about how somebody created a bubble....It's now about to pop.... we gonna have dot.com bubble version 2.0.
And this time, it's not going to be "housing subprime" bubble that will patch dot.com bubble. It will instead be Asia pulling money out of the popping bubble. ... Dollar liquidity will drain out overnight. (assuming there is no Israel-Iran war)
-
Hugh Hendry On Europe "You Can't Make Up How Bad It Is"
http://www.zerohedge.com/news/hugh-hendry-europe-you-cant-make-how-bad-it
lolol..euro dollar parity??? ... NOT GOING TO HAPPEN............... it will destroy america/dollar economy. Ben bernank will keep printing dollar and buy euro until it's $1.20
That's Mercedes at the price of Chevy!!! The entire US economy will die three times over at that price.
-
Contrary Indicator Alert: Greenspan Says U.S. Stocks ‘Very Cheap,’ Likely to Rise
Bloomberg authors By Steve Matthews and Tom Keene report Greenspan Says U.S. Stocks ‘Very Cheap,’ Likely to Rise
Former Federal Reserve Chairman Alan Greenspan said U.S. stocks offer
good value and are likely to rise as corporate earnings increase over
time.
“Stocks are very cheap,” Greenspan said today at the Bloomberg
Washington Summit hosted by Bloomberg Link, citing “a very low
price-earnings ratio.”
“There is no place for earnings to grow except into stock prices,” said
Greenspan, who served as Fed chairman from August 1987 to January 2006.
Another valuation metric, known as the Fed model because it was derived
from a July 1997 report from the central bank, shows U.S. equities are
close to the cheapest level ever relative to debt. The technique
compares the earnings yield for stocks with Treasury rates.
----------------
Trying to pump the stock market ... something is up. -
Off
with King Sarko's head
By Pepe
Escobar
He posed in spectacular
grandeur as the neo-imperial Liberator of
Libya - only a few years after Colonel Muammar
Gaddafi helped finance his 2007 election campaign
with a cool US$65 million.
Profiting from
a mysterious alliance between the Holy Ghost and
an African chambermaid in New York, he got rid of
the unstoppable challenger to his re-election,
former International Monetary Fund director
general and international sex fiend, Dominique
Strauss-Khan.
And still, this Sunday,
French voters - in a Facebook-style remix of the
fall of the Bastille - are bound to yell "Off with
his head".
http://www.atimes.com/atimes/Global_Economy/NE05Dj03.html
once he is out of office, a lot of people gonna want him dead. he betrayed too many people. I would imagine the libyans already prepare a death squad on him. Plus he shouldn't insult the chinese with that 2008 olympic. otherwise he could have gotten a banking deal and he would still be president now. And, he is a zionist, in france? oboy... Then there is the north african he fucks. On top of labors.
-
April confirmed everything we had been warning about: in the month, full time jobs dropped to 114,478 from 115,290, an epic drop of 812,000 in full time jobs which was the biggest since... March 2009! The
offset? Why a surge in part-time jobs of course, which increased by
508,000 in the month of April. So while seasonally adjusted, birth/death
recasted jobs may have increased by 115,000, the real quality jobs,
imploded, which unfortunately is merely a part of a longer-term secular
trend as part of the new part-time normal.
more oil war. In order to prevent deflation, print more money so gas price hit all time record! There will be no inflation. Bullish! Buy appl.
...did I cover everything? Amazing how democracy works. I feel like we are in the age of retard.
http://www.zerohedge.com/news/two-scariest-charts-todays-nfp-report-or-real-new-part-time-normal
...in fact, as of March 2012, hourly wage change was nearly 44 percent
below the rate of change as of March 2007, prior to the Great Recession.
Not only is wage growth slowing, but the real value of hourly
wages—once adjusted for inflation—is also declining when compared to the
prior year. From March 2011 through March 2012, real average hourly
earnings fell 0.6 percent for all private sector workers and declined by
even a great degree—1.0 percent—for nonsupervisory and production
workers.Changes in the number of hours worked per week by both groups did not
make up for the loss in wages: an uptick in the hours worked among all
private sector employees left their real total weekly wages (a product
of the hourly wage and hours worked per week) unchanged, while an
increase in hours for production and nonsupervisory workers still
resulted in 0.5 percent decline in real total weekly wages.http://www.dailykos.com/story/2012/05/03/1088519/-Wage-growth-decline-puts-drag-on-economic-recovery
-
The frontrunner Hollande accused Sarkozy of dividing
the French, while the incumbent Sarkozy alleged that Hollande's economic
program could be catastrophic and cause market chaos.
Tensions came frequently in the debate. When Hollande threw out the
question why Germany was doing better than France, Sarkozy struck back
by saying that Germany had been doing the opposite of the policies
proposed by Hollande.
While Hollande vowed to be a president of "justice" that would
restore production and jobs and bring the French people together,
Sarkozy immediately refuted that it would be too late if voters elected
someone from scratch.
The incumbent added that he was unfairly blamed for the country's
economic problems after years of crisis, while Hollande could not help
complaining that he was blaming everything on crisis.
The presidential debate, a classic arrangement in French politics,
kicked off at 9 p.m. local time (GMT 1900) at a studio north of Paris
and was agreed by both sides to last no more than two and a half years.
An estimated 20 million French voters were tuning in to watch the
so-called "last duel" that was broadcast live on major national TV
channels and seen as the climax of presidential campaigns four days
before the runoff election.
http://news.xinhuanet.com/english/world/2012-05/03/c_131564809.htm
-
Quantitative Easing (QE) is/was seemingly a magic remedy, at least in
the short-term. As GLG's Pierre Lagrange notes, central bankers can
conjure up money out of thin air and use it to purchase assets - transforming
transferring toxic debt, stimulating demand for risk assets, devaluing
currencies (this deflating debt), and maintaining low interest rates on
govvies. The ECB's more restrictive mandate, however, does not
allow them to print money for any other purpose than lending and so
direct QE was out of the question and so, as the chart below
demonstrates, they ingeniously created the LTRO - delivering an infusion of liquidity (potential profits from carry and hope for capital raises).
http://www.zerohedge.com/news/visualizing-why-ltro-qe
I think they also do it through dollar-euro swap, directly. I am not going to bitch since I basically agree with this temporary strategy. The exchange is fairly stable lately.
-
WTI < $100
http://www.zerohedge.com/news/wti-100
lessee if they are dumb enough to start a war of print more money before the election.
-
http://www.ritholtz.com/blog/2012/05/10-mid-week-pm-reads-12/
freeee money for bankstersss!! more more more ...
-
Rosenberg, exactly 5 years ago today in May 2007:
>
click for full report
http://www.ritholtz.com/blog/2012/05/in-retrospect-it-was-no-joke/
Facebook....$76Billion !... probably on the way to $700 gazillion.. bigger than poland...bullish..
-
Brent crude gained 12 cents to $116.20 a barrel by
0216 GMT, after racking up a 3 percent loss in two straight
sessions, its biggest two-day percentage loss since Feb. 28.
U.S. crude gained 13 cents to $102.67, after ending about
2.5 percent lower.
http://www.reuters.com/article/2012/05/04/markets-oil-idUSL4E8G411L20120504
-
Socialist Francois Hollande 'wins French presidency'
Socialist Francois Hollande has been elected as France's new president, early estimates say.
He got about 52% of votes in Sunday's run-off, according to
projections based on partial results, against 48% for centre-right
incumbent Nicolas Sarkozy.
Mr Hollande would be the first French socialist president since 1995.
Analysts say the vote has wide implications for the whole
eurozone. Mr Hollande has vowed to rework a deal on government debt in
member countries.http://www.bbc.co.uk/news/world-europe-17975660
The european public is not in the mood to entertain banksterism. Next to go will be US based zionism military antics. Just watch... next thing you know the european start cutting off line to the US. after withdrawing support on all military operation.
-
- Rises in both taxes and government spending (seemingly more of the latter than the former).
- Emphasis on improved funding for education, with 60,000 new teachers.
- More banking regulations
- Same-sex marriage and adoption
- More resistance to Europe.
- Early withdrawal from Afghanistan (by the end of this year).
His policies are certainly radical, by today's standards, but whether or not they will work remains to be seen.
Source: http://en.wikipedia.org/wiki/Francois_Hollande#Policies
http://www.reddit.com/r/worldnews/comments/t9xm8/socialist_francois_hollande_wins_french_presidency/
-
The Banks' Nightmare Is Coming True: Greek Left Calls For Anti-Bailout CoalitionThe only saving grace of the earlier
horrendous Greek parliamentary vote was that, based on very preliminary
results New Democracy and Pasok would be able to form a coalition
government with precisely 151 seats needed in parliament to give them
status quo powers. However, according to a more recent re-rack of the
votes (New Democracy 18.9%, 108 seats, Pasok 13.4%, 41 seats, Syrizia: 16.6%, 51 seats, and
all others), this assumption is now in jeopardy as the two pro-bailout
parties will have just 149 seats in the new parliament, or not even a
full majority. Why is this problematic? Because virtually every other
party in the new parliament, and there may be up to 10 there including
the New Dawn, have voiced their opposition to the bailout of Greece,
which as everyone knows is merely a bailout of Europe's insolvent banks
using Greek taxpayer funds as a conduit. And, adding insult to injury,
Reuters now reports that "Greek leftist leader calls for anti-bailout
coalition." It appears that finally, after many years of delays, the
anti "bailout" genie is finally out of bottle... -
Broadly-speaking, US equity futures, Treasuries, and FX markets have
stabilized at somewhat convergent levels for now and as the Yuan
depreciates (that's the opposite of appreciates Senator Schumer) the
most in 3 weeks, we await Europe's open for the real derisking
action to begin (especially as we remind readers of the drying-up of
collateral for any new ECB funding shenanigans - most notably for the
worst nations such as Spain as we noted here).
http://www.zerohedge.com/news/treasuries-plummet-3-month-low-yields-equities-recouple
-
Euro tanks to three-month low after Greek vote upsets
With 95 percent of votes counted, the
conservative New Democracy (ND) and socialist PASOK, who have dominated
Greece for decades, is seen falling short of the 151-seat threshold
needed for even the most fragile majority in parliament."The
PASOK did unexpectedly poorly in the election ... Until we have more
clarity on how the coalition government will be formed and what the new
government will do with the bailout scheme, the euro will stay under
pressure," said Masafumi Yamamoto, chief FX strategist at Barclays.The
euro fell as far as $1.29552, its lowest since January 25, breaking
below the rough $1.30-$1.35 trading band it had been stuck in since
February. The euro last traded at $1.2978, down 0.8 percent from late
U.S. levels last Friday.http://www.reuters.com/article/2012/05/07/us-markets-forex-idUSBRE83Q0O120120507
Euro is diving... see how low ben bernank will let it go... repeat of few months before.. 1.25, 1.20 .. at least brent will go down in relation to dollar. this will fuel asian growth a little.
-
Well, that lasted far less than the three days expected:
- SAMARAS SAYS WAS UNABLE TO FORM GOVERNMENT
- SAMARAS SAYS DID ALL POSSIBLE TO FORM GOVERNMENT
- SAMARAS HANDS BACK MANDATE TO PRESIDENT PAPOULIAS
- SAMARAS SAYS AIM TO KEEP GREECE IN EURO
And now the broad-left coalition Syriza gets the mandate to form a
coalition government. If successful, and with nearly 60% of the parties
in parliament being anti-bailout it would not take much for differences
to be resolved, all bets are off as the anti-bailout powers will finally
gain control of Greece, effectively ending European control over
Greece. Alternatively, if nothing is achieved, then it is very likely
that Greece will have another election within 3-4 weeks. And then
another. And then another.yes, until the people fed up and start executing those clowns and appoint Ceasar. Current form of representative democracy is dead anyway, everywhere it's the same, a corrupt scoundrels controlled by this and that cartel. Not working for the people or country.
I expect sooner of later public will start examining the foundation of current political system since it's deeply flawed. Too easily co-opted.
-
What a party
that was in Bastille on Sunday night - capable of
sending chills to any spine. A cross-section of
French society sending a message to Europe and the
wider world; it's possible to dream of change -
and most of all, social justice. There is an
alternative.
And all that with a Quiet
Frenchman as the lightning rod. A "normal" guy.
Not bad for what was the socialists' replacement
choice - after former uber-favorite, then
International Monetary Fund (IMF) director
Dominique Strauss-Kahn, fell for that extremely
dodgy sex trap at the Sofitel in New York.
But now it's hangover time. The Left runs
only seven among 27 European Union (EU) nations.
The bling bling King Sarko, neo-Napoleonic
Liberator of Libya former president Nicolas
Sarkozy, has been reduced to a minor historical
footnote - with his popstar Italian belle wife
Carla Bruni already plotting her next career move.
King Sarko is the 11th European leader to fall
over the double-dip European recession. "Merkozy"
- King Sarko and German chancellor Angela Merkel,
the mongrel couple running Europe, is dead.
http://www.atimes.com/atimes/Global_Economy/NE08Dj06.html
Merkel will survive if she retools her message since german economy is working. And from germans point of view she hasn't fucked up yet. She has done a reasonably good job. The logical outcome I think is pretty much set. Germany at the turn of 20th century. Looking east. Russian gas and Chinese cash with reformulation of German-france alliance. From there the rest of european midgets will follows. The hardest part is how the germans have to deal with US, it's a completely fubar entity. More so than Europe in term of global geopolitical standing.
All I am waiting for is zionist stirring up trouble in europe soon... manufactured scandal, riot, bombing, etc.. vintage 30's agitprop.
-
Clinton to meet SM Krishna, India to take up Saeed issue
US secretary of state Hillary Clinton today will meet external affairs
minister SM Krishna to discuss bilateral matters. Krishna is expected to
take up the need to rein in the Lashkar-e-Taiba and its chief patron
Hafiz Saeed in the meeting.
http://www.hindustantimes.com/India-news/NewDelhi/Clinton-to-meet-SM-Krishna-India-to-take-up-Saeed-issue/Article1-852381.aspxPakistan has not done as much as US and India wanted: Clinton
what does this mean? US is now involved in Pakistan-India conflict? not very smart is it? If she is thinking to use India to kick Pakistan, I am willing to bet India sees this and gonna come up with different game plan ... this is exactly the same as 'why don't you indians kick some chinese behind for us ..'
-------------So, we come back to Mamata, the deal breaker of the US’ geostrategy
in South Asia. Washington appreciates that Mamata holds the key to
India-Bangladesh relations. And the US regional strategy is predicated on
the India-Bangladesh relationship. The US-India regional axis has
reached a cul-de-sac and the impasse can be broken only if Mamata plays
ball.The point is, there is also no time to be lost. As the saying goes,
strike when the iron is hot. Time is indeed running out, as the Sheikh Hasina government may not last forever. Bangladesh may overnight change its disposition toward India and then everything goes phut.If I were in Clinton’s place, I wouldn’t take risks. I’d
straightway arrange a Nobel for Mamata — so that the Big Oil caravan
moves forward without impediments on the road to Dhaka and arrives there
ahead of the China National Petroleum Corporation which has a habit of
reaching such destinations first.
http://blogs.rediff.com/mkbhadrakumar/2012/05/04/clinton-takes-charge-of-mamata/
--------------
huh? ... somebody is about to fuck everything up grandly. This is a complete replay of Pakistan-Afghanistan 'new' approach 4 years ago, which of course ends in a lot of blood and tears. "breakthrough" ..game changer... etc.
So now, she is trying her hand in different complicated area? ... not good. (friend of Syria, anybody? remember Libya? paradise of democracy last I heard.)
If I have to put my shiny dime, that area is going to blow up spectacularly in few months. ..my advice to everybody there...duck for cover and run. ..major fuck up in the making.
-
BOJ Tells Fed Credit Rules May Hinder Japan Monetary Policy
Hinder Money Markets
Under the rules, U.S. financial institutions could be
unable to maintain “sufficient” amounts of reserves in their
current accounts with foreign central banks, Yamamoto said.
Limits relating to non-U.S. sovereign debt securities may reduce
liquidity and hinder money-market operations that use them as
collateral, the official said.“The counterparties of the Bank of Japan (8301) in conducting
money-market operations include a number of U.S. financial
institutions with current accounts with the bank,” Yamamoto
said. “The proposed rule therefore could reduce the
effectiveness of the bank’s monetary policy conduct, and hamper
the daily payments and settlements via the current accounts with
the bank.”Yamamoto added that the Bank of Japan believes the Fed will
find a “creative and practical solution” and avoid unintended
consequences through international talks.The Fed plans to limit financial firms with at least $500
billion in assets from having credit risk to any other exceeding
10 percent of its regulatory capital plus excess loan-loss
reserves. That is stricter than a 25 percent restriction that’s
applied more broadly to banks in the Dodd-Frank financial-
overhaul law.....oooooohhh.......so, like..there isn;t enough 'real' money around if they can't use fake asset under new rule?
-
From China's viewpoint, the US
"pivot" towards Asia is an aggressive stance meant
to threaten and contain China. These troops serve
no purpose in defending America from attack. The
planned deployment of 2,500 marines to Western
Australia, naval cooperation with the Philippines,
the open goal of increasing the United States'
naval capabilities on China's coastline, and the
continued presence of roughly 50,000 US military
personnel in Japan are all seen as unnecessary
provocations. One can imagine the American
response if China stationed massive military
forces in the Caribbean.
...
A
recent military standoff between Philippines and
China in the South China Sea exemplifies the
security issues that trouble China-US relations.
In March Chinese naval vessels reportedly
threatened to ram a Filipino research ship in the
disputed waters, prompting the Filipino military
to dispatch its navy and air force to the scene of
the confrontation.
http://www.atimes.com/atimes/China/NE09Ad01.html
pef.. seriously . philipine sees this as an opportunity for free weapons. YT wants kicking ching show, then put a show. Make sure the free weapons flow. (3 small frigate, and promise of f-16 squadron so far.) (eg. it's another Pakistan move. free money and weapons for little military show.)
Americas general standing in pacific is mid 19th century imperialism. Hence you have words like "pivot". Imagine using that word on Israel (pivot against arabian oil), or Europe, pivot against eurasia energy supply. Clinton is basic redneck. think plantation lady ordering house servant. She runs around and bs-ing the native around like she owns those places, while everybody there has that dejavu creepy feeling. Imperialism as thought in every elementary student textbook. On positive note, nobody is under the illusion that there is "good will", world peace, "working together", 'mutual interest" and all that jazz. It's dog eats dog world. Schemes. Scoundrel, grifter and swindler. Name the prize, who is your daddy...
so, understanding all recent odd double talks are easy. south china, relationship with asean, philppines, tibet, korean peninsula, India-china, India-Pakistan, af-pak, cheonan, etc... basic imperialism move. pit one country against another, fomenting conflict, instigating instability, insurgencies, .. bla bla. Nobody is fooled. People down there know and simply bidding their time. All these are going to blow back grandly in a few years.
In the meantime, I think people like Hillary starts to lean what "fear" is. The size, magnitude and complexity of the problem are beyond her competency. (notice where she spend time or where she doesn''t dare to step her foot in open space again.) All that bland reports actually have consequences and they don't follow US election calendar. There aren't enough ships and troops to cover the entire ocean and continent.
-
BRIC Bank in concept stage, may take time: TCA Ranganathan, Exim Bank CMD
Have you done any ground work?
The economic
structures are so different that we will have to work our way through.
All of us are trying to use our own currencies for trade rather than
third country's currency. The volatility on the US dollar has gone up
tremendously, impacting exporters. There has to be some mechanism of
insulating these smaller chaps from volatility. And the simplest would
be a kind of a local currency settlement. But for a single currency
settlement, you got to have balance of trade. Our trade balance with
China is one sided, with Brazil it is more or less in balance. South
Africa is also more or less in balance. Russia also it is not much.
China has a positive with most of the countries. And local currency settlement
means that ultimately you have to get the local currency to pay for it.
Best payments mechanism, which is steady and long-term, is that they
must have exports are going up in an equal measure or capital going at
an equal measure.
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The equation was not at fault: the
output is only as good as the inputs. The real problem was the
instruments being traded: credit default swaps. These are of dubious
merit and much more complicated than more traditional underlying
instruments (the thing on which you hold an option contract). For
example, suppose you have an option to be 100 shares of Google at a
given price. It's easy to evaluate the value of the underlying
instrument because there's an efficient market for it: Google is traded
on a public exchange and the value is agreed upon within a penny,
generally. Black-Scholes works on Google options just fine and you can
minimize your risk reasonable well using it.
The credit default
swaps were much more difficult to evaluate because of the lack of an
efficient market for them. The essential nature of the underlying
instrument were very high risk mortgages, not too different in concept
from so-called junk bonds. The potential return was high because the
interest rate was high. The potential risk was high because the risk of
default was high, making the underlying instrument worth very little,
much less than face value. So take these risky mortgages and then buy
insurance policies for them, this is standard practice. That hedges the
risk of the actual mortgage itself. Bundle the mortgage and the
insurance policy up into a quasi-mutual fund like product: you have x
number of mortgage/insurance policy bundles with average risk of default
at y. Getting more difficult to put a value on, especially since there
is no regulated exchange for them and little oversight.
Not done
yet. Add in that deregulation rules passed during the Clinton era
allowed the banks that issue the mortgages and buy the insurance
policies to also use their assets to trade on their own. This group
within a group is called "proprietary trading". So, the prop-trading
groups within the banks buy and sell the mortgages and insurance
policies to each other in order to generate income for the bank. There
are also other groups that buy and sell these instruments that don't
actually issue mortgages. These are called speculative traders.
Finally,
to put the finishing touches on this pile of doo, have a group create a
new instrument: a binary option (it does or it doesn't) on a bundle of
high-risk mortgages and their insurance policies. A binary option is
essentially a gamble: it pays out if something happens, it does not pay
out if something doesn't happen. Now you're buying and selling options
contracts which predict whether a group of mortgages will fail or not.
There's no regulation, no formal exchange (which helps create market
efficiency). There's no reliable way to determine the value of the
underlying instrument because it depends on knowing how many of the
mortgages will fail. And don't forget that the banks were using their
investment customers to create demand for a product they wanted to sell
("I think you should invest in such-and-such") without telling the
customers that the banks themselves would be profiting by selling
questionable instruments to their own customers.
This is the magic
of unregulated capitalism (almost - the banks should have been allowed
to fail in a purely unregulated capitalism system). Nothing wrong with
Black-Scholes here. The real problem at the core is that the banks
involved are so driven by short-term success that there is no room for
sanity. Wrap it all up with the fact that the banks know they
will be bailed out by the Feds if they fail. There is no penalty for
risk and no regulatory oversight. Gotta have one or the other or we just
plain deserve this insanity.