From Zero Hedge:
Over the past several months, many pundits were scratching their heads at the peculiar patterns in summer hiring and layoff trends, which threw all NFP, claims, and JOLTs forecasts in a loop making a mockery of even the best forecasters. The reality is that there was a very specific reason for this abnormal seasonal pattern: numerous car plants worked throughout the summer, avoiding traditional temporary shutdowns and furloughs, in an attempt to provide an optical boost to the Union-endorsed administration. And as always happens (see Cash for Clunkers), every attempt to pull demand or supply from the future to the present results in an eventual collapse in either of these two. Sure enough, with June and July reaping the benefits of advance demand, August is set be an absolutely abysmal month for US auto assemblies and for Industrial Production. Because as Stone McCarthy calculates, based on projections provided by Wards Autos, the U.S. motor vehicle assembly rate for August is projected to decline by 8% to a 10.1 million annualized rate after rising by 4.4% in July. This would be the biggest monthly percentage decline in the assembly rate in about a year and a half, since April 2011's 9.5% drop.
And since Industrial Production feeds directly into bean counter models for GDP calculations 2%+ GDP forecasts for Q2 are about to see their floor falling off and the economy return to a sub-stall speed growth rate, even as the growth rate of debt refuses to budge lower by even one iota.
http://www.zerohedge.com/news/more-bad-news-imminent-august-us-auto-production-set-plunge-most-16-months
Thursday, August 30, 2012
Wednesday, August 29, 2012
Matt Taibbi: The True Story of Mitt Romney and Bain Capital
From Rolling Stone:
The great criticism of Mitt Romney, from both sides of the aisle, has always been that he doesn't stand for anything. He's a flip-flopper, they say, a lightweight, a cardboard opportunist who'll say anything to get elected.
The critics couldn't be more wrong. Mitt Romney is no tissue-paper man. He's closer to being a revolutionary, a backward-world version of Che or Trotsky, with tweezed nostrils instead of a beard, a half-Windsor instead of a leather jerkin. His legendary flip-flops aren't the lies of a bumbling opportunist – they're the confident prevarications of a man untroubled by misleading the nonbeliever in pursuit of a single, all-consuming goal. Romney has a vision, and he's trying for something big: We've just been too slow to sort out what it is, just as we've been slow to grasp the roots of the radical economic changes that have swept the country in the last generation.
The incredible untold story of the 2012 election so far is that Romney's run has been a shimmering pearl of perfect political hypocrisy, which he's somehow managed to keep hidden, even with thousands of cameras following his every move. And the drama of this rhetorical high-wire act was ratcheted up even further when Romney chose his running mate, Rep. Paul Ryan of Wisconsin – like himself, a self-righteously anal, thin-lipped, Whitest Kids U Know penny pincher who'd be honored to tell Oliver Twist there's no more soup left. By selecting Ryan, Romney, the hard-charging, chameleonic champion of a disgraced-yet-defiant Wall Street, officially succeeded in moving the battle lines in the 2012 presidential race.
http://www.rollingstone.com/politics/news/greed-and-debt-the-true-story-of-mitt-romney-and-bain-capital-20120829#ixzz24xf09y6s
The great criticism of Mitt Romney, from both sides of the aisle, has always been that he doesn't stand for anything. He's a flip-flopper, they say, a lightweight, a cardboard opportunist who'll say anything to get elected.
The critics couldn't be more wrong. Mitt Romney is no tissue-paper man. He's closer to being a revolutionary, a backward-world version of Che or Trotsky, with tweezed nostrils instead of a beard, a half-Windsor instead of a leather jerkin. His legendary flip-flops aren't the lies of a bumbling opportunist – they're the confident prevarications of a man untroubled by misleading the nonbeliever in pursuit of a single, all-consuming goal. Romney has a vision, and he's trying for something big: We've just been too slow to sort out what it is, just as we've been slow to grasp the roots of the radical economic changes that have swept the country in the last generation.
The incredible untold story of the 2012 election so far is that Romney's run has been a shimmering pearl of perfect political hypocrisy, which he's somehow managed to keep hidden, even with thousands of cameras following his every move. And the drama of this rhetorical high-wire act was ratcheted up even further when Romney chose his running mate, Rep. Paul Ryan of Wisconsin – like himself, a self-righteously anal, thin-lipped, Whitest Kids U Know penny pincher who'd be honored to tell Oliver Twist there's no more soup left. By selecting Ryan, Romney, the hard-charging, chameleonic champion of a disgraced-yet-defiant Wall Street, officially succeeded in moving the battle lines in the 2012 presidential race.
http://www.rollingstone.com/politics/news/greed-and-debt-the-true-story-of-mitt-romney-and-bain-capital-20120829#ixzz24xf09y6s
John Aziz: Currency Competition
From Zero Hedge:
Monopolies contribute to many problems - the record of evidence illustrates the potential inefficiency, waste and price fixing. Yet the greatest trouble with monopolies is what they take away - competition. Competition is a beautiful mechanism; in exercising their purchasing power and demand preferences, individuals run the economy. If we are for competition in goods and services, why should we disclude competition in the money industry? Would competition in the money industry not benefit the consumer in the manner that competition in other industries does? Why should the form and nature of the medium of exchange be monopolised? Shouldn’t the people - as individuals - be able to make up their own mind about the kind of money that they want to use to engage in transactions? Earlier, this year Ben Bernanke and Ron Paul had an exchange on this subject. It is often said in Keynesian circles that Bernanke is too tame a money printer, and that the people need a greater money supply. Well, set the wider society free to determine their own money supply based on the demand for money.
http://www.zerohedge.com/news/guest-post-currency-competition
Monopolies contribute to many problems - the record of evidence illustrates the potential inefficiency, waste and price fixing. Yet the greatest trouble with monopolies is what they take away - competition. Competition is a beautiful mechanism; in exercising their purchasing power and demand preferences, individuals run the economy. If we are for competition in goods and services, why should we disclude competition in the money industry? Would competition in the money industry not benefit the consumer in the manner that competition in other industries does? Why should the form and nature of the medium of exchange be monopolised? Shouldn’t the people - as individuals - be able to make up their own mind about the kind of money that they want to use to engage in transactions? Earlier, this year Ben Bernanke and Ron Paul had an exchange on this subject. It is often said in Keynesian circles that Bernanke is too tame a money printer, and that the people need a greater money supply. Well, set the wider society free to determine their own money supply based on the demand for money.
http://www.zerohedge.com/news/guest-post-currency-competition
The Rot Runs Deep 3: The Capture of the Professional Class
From Of Two Minds:
The Status Quo depends on the professional/managerial class to maintain order and keep the machine running. Since this class has more options in life than less educated lower-income workers, their belief in the fairness and stability of the Status Quo is essential: should their belief in the Status Quo weaken, so would their commitment to positions that require long work days and abundant stress....At every juncture where a decision to opt out (quit) or continue serving the Status Quo arises, the believer is co-opted by their desire to "stay in the game" for the promised slice of wealth and security. The risk-return calculus is heavily skewed to complicity, because the options for wealth and security outside the machine are meager and loaded with risk. It is my contention that the wealth and security promised by the machine in exchange for subservience are phantom, and the risk of the promises not being kept is much higher than generally assumed. ironically, those who opt out and accept the risk and lower compensation are actually more secure and much wealthier (in terms of well-being and autonomy) than those who submit to voluntary capture.
http://www.oftwominds.com/blogaug12/capture-of-professionals8-12.html
The Status Quo depends on the professional/managerial class to maintain order and keep the machine running. Since this class has more options in life than less educated lower-income workers, their belief in the fairness and stability of the Status Quo is essential: should their belief in the Status Quo weaken, so would their commitment to positions that require long work days and abundant stress....At every juncture where a decision to opt out (quit) or continue serving the Status Quo arises, the believer is co-opted by their desire to "stay in the game" for the promised slice of wealth and security. The risk-return calculus is heavily skewed to complicity, because the options for wealth and security outside the machine are meager and loaded with risk. It is my contention that the wealth and security promised by the machine in exchange for subservience are phantom, and the risk of the promises not being kept is much higher than generally assumed. ironically, those who opt out and accept the risk and lower compensation are actually more secure and much wealthier (in terms of well-being and autonomy) than those who submit to voluntary capture.
http://www.oftwominds.com/blogaug12/capture-of-professionals8-12.html
350 Million Indian Families Starve As Politicians Loot $14.5 BIllion In Food
From Zero Hedge:
While The Brits are about to tax their Super-Rich, it appears one of the old colonies remains in full anti-Robin-Hood mode. Nothing surprises us much anymore but this note from Bloomberg too the proverbial biscuit. In the "most mean-spirited, ruthlessly executed corruption," India's politicians and their criminal syndicates have looted as much as $14.5bn in food from one province alone. 57,000 tons of food meant for the devastatingly poor of the Uttar Pradesh region is sat in a government storage facility five football fields long. The 'theft' has blunted the nation's only weapon against mass starvation and as Supreme Court commissioner Naresh Saxena notes: "What I find even more shocking is the lack of willingness in trying to stop it," as the Minister for Food, who stands charged with attempted murder, kidnapping, armed robbery and electoral fraud, has diverted more than 80 percent of the food. "Who is a person who holds a below poverty line ration card? A person of no influence; you can just tell him to buzz off." But there is growing tension "We could just storm the place, and every one of us could get a bag of rice each. Who would stop us?"
http://www.zerohedge.com/news/350-million-indian-families-starve-politicians-loot-145-billion-food
While The Brits are about to tax their Super-Rich, it appears one of the old colonies remains in full anti-Robin-Hood mode. Nothing surprises us much anymore but this note from Bloomberg too the proverbial biscuit. In the "most mean-spirited, ruthlessly executed corruption," India's politicians and their criminal syndicates have looted as much as $14.5bn in food from one province alone. 57,000 tons of food meant for the devastatingly poor of the Uttar Pradesh region is sat in a government storage facility five football fields long. The 'theft' has blunted the nation's only weapon against mass starvation and as Supreme Court commissioner Naresh Saxena notes: "What I find even more shocking is the lack of willingness in trying to stop it," as the Minister for Food, who stands charged with attempted murder, kidnapping, armed robbery and electoral fraud, has diverted more than 80 percent of the food. "Who is a person who holds a below poverty line ration card? A person of no influence; you can just tell him to buzz off." But there is growing tension "We could just storm the place, and every one of us could get a bag of rice each. Who would stop us?"
http://www.zerohedge.com/news/350-million-indian-families-starve-politicians-loot-145-billion-food
Tuesday, August 28, 2012
From Hard Landing To Train Crash, All Chinese Indicators Have Slammed On The Brakes
Another data point on China going in for the hard landing.
From Zero Hedge:
As Robin might say "Riddle me this Batman": how can an country, supposedly growing its economy at over 7%, with factory output up over 9%, manage all of this superlative production while rail traffic is shrinking at almost 5.4% annually?
http://www.zerohedge.com/news/hard-landing-train-crash-all-chinese-indicators-have-slammed-brakes
From Zero Hedge:
As Robin might say "Riddle me this Batman": how can an country, supposedly growing its economy at over 7%, with factory output up over 9%, manage all of this superlative production while rail traffic is shrinking at almost 5.4% annually?
http://www.zerohedge.com/news/hard-landing-train-crash-all-chinese-indicators-have-slammed-brakes
Monday, August 27, 2012
"Struggle Of The Ant Tribe" - China's Broken Dreams
From Zero Hedge:
Those who think that China's centrally-planned transition to the world's leading, fastest growing economy in the shortest time in world history, coupled with its attempt to shift from a mercantilist, export-driven economy, to one sporting the world's largest middle class is progressing smoothly and according to plan, especially as related to millions of overeducated young adults who are finding it impossible to find a job in China's big cities, and find their diplomas uselss in the small ones, are urged to watch the following documentary exposing "China's Broken Dreams." From Al Jazeera: "[The Chinese] people are discovering that society's resources and opportunities are increasingly concentrated in the hands of a few. People in the middle and lower strata of society are becoming increasingly marginalised and are finding that improving their lives is getting harder. [This imbalance could lead to] the rich getting richer and the poor poorer, the strong permanently strong and the weak permanently weak .... The biggest harm may not be in the gap between rich and poor itself, but the deterioration of the overall societal ecosystem." Translation: class war unlike anything seen even in America, where class war is the basis for the entire presidential campaign. Because unlike the US, "class war" in China will have a far more true to its name outcome.
http://www.zerohedge.com/news/struggle-ant-tribe-chinas-broken-dreams
Those who think that China's centrally-planned transition to the world's leading, fastest growing economy in the shortest time in world history, coupled with its attempt to shift from a mercantilist, export-driven economy, to one sporting the world's largest middle class is progressing smoothly and according to plan, especially as related to millions of overeducated young adults who are finding it impossible to find a job in China's big cities, and find their diplomas uselss in the small ones, are urged to watch the following documentary exposing "China's Broken Dreams." From Al Jazeera: "[The Chinese] people are discovering that society's resources and opportunities are increasingly concentrated in the hands of a few. People in the middle and lower strata of society are becoming increasingly marginalised and are finding that improving their lives is getting harder. [This imbalance could lead to] the rich getting richer and the poor poorer, the strong permanently strong and the weak permanently weak .... The biggest harm may not be in the gap between rich and poor itself, but the deterioration of the overall societal ecosystem." Translation: class war unlike anything seen even in America, where class war is the basis for the entire presidential campaign. Because unlike the US, "class war" in China will have a far more true to its name outcome.
http://www.zerohedge.com/news/struggle-ant-tribe-chinas-broken-dreams
Sunday, August 26, 2012
“Because of God’s tender mercy, the morning light from heaven is about to break upon us, to give light to those who sit in darkness and in the shadow of death, and to guide us to the path of peace.”
Luke 1: 78-79
미국에 있는 동안 많은 곳을 여행했지만 단연 베이 지역 자연이 가장 마음에 남아있다. 주말에 차 막히는 것 걱정 안하고 찾아가 편안하게 쉬고 때론 위안을 얻고 왔던 곳들이다. 그곳에 살면서 가장 기억에 남아있는 곳들은 관광명소로서 이미 많이 알려진 장소보다 (물론 Carmel 바다도 매우 좋아했고 serene한 느낌을 받았던 Muir Woods를 산책하는 것도 좋아했지만) 로컬 사람들이 주로 찾는 평온함과 평화를 느낄 수 있는 Marine County의 몇몇 바닷가이다. 마음속에 기억하는 바닷가 모습을 아주 비슷하게 사진에 담아 주신 분의 블로그를 발견해 바닷가 이름을 알려주실 수 있냐고 혹시 Marine County의 한 바닷가가 아니냐고 여쭤봤더니 그렇다고 하셨다. 그분이 찍으신 베이지역 바닷가의 사진을 고정 독자분들과 공유하고 싶어 올린다. 복잡한 현실 속에 살아가는 우리지만 이 세상 모습이 아닌 듯한 풍경에서 하나님이 임재하심을 느낄 수 있었던 축복의 시간들이었다. 베이 지역 계시는 분들은 감사히 많이 누리시기를.
Luke 1: 78-79
언젠가 블로그에 썼던 것 같은데 워낙 자연 풍광 보기를 좋아하는 나는 베이 지역에 일하러 살러 가게될 줄 모르고 학회참석차 그곳을 방문했을 때 며칠 그 일대를 관광객으로서 보러 다녔었다. 그러다 차에 짐 싣고 며칠을 운전해 그곳에 도착해 금문교 다리를 다시 봤을때 (미국의 반을 가로질러 친구와 함께 여러 주를 차로 여행하고 도중에 친구들 집에 머물렀던 그 여정도 참 좋았는데) 무사히 도착했다는 안도감과 다시 그 곳 자연을 다시 접할 수 있음에 감사한 마음이 설레였던 것을 기억한다. 그 곳을 떠날 때 그리워할 것을 알고 있었다.(한국의 아기자기한 풍광도 아름답지만 서울에서 주말에 방문하려면 교통체증이 답답하고 또 웬만한 곳은 음식점이 즐비해서 유원지화 돼 있는 경향이 크다.)
Chris Hedges on 'Empire of Illusion' and a Vignette of The Fall of Berlin 1945
Another good interview with Chris Hedges.
From Jesse's Cafe:
I came across a nice, compact interview with Chris Hedges which illuminates his thesis of the decline of the American Empire and the illusions and the end of rational thinking that accompanies it. Empires seem to give off quite a bit of flash in their latter stages, rather like the last gasp of a dying star.
The interviewer does a particularly nice job of drawing Hedges out.
I would like to add an observation I made in thinking further this afternoon about the Sophie Scholl piece I put up earlier this morning. There is something about gardening that focuses the mind.
The almost frenetic preoccupation and adherence to the Nazi ideology in the latter stages of the war, when it was obvious to any rational observer that they could not win, is remarkable. I had been particularly struck in my reading some time ago with the 'wolf packs' of Nazis who had raged through Berlin, rounding up old men and even boys who had not joined the Volkssturm, and hanging them, even while the Russians were shelling the Reichstag. It never made sense to me until today.
This is an almost perfect illustration of the credibility trap. One cannot allow the illusion to falter, even a little, to the bitter end. And as the fraud fades, the force intensifies, becoming almost rabid. Because that illusion has become the center of a hollowed person's being, their raison d'être, and mythological justification.
If the ideology had been a lie, then they are not heroes and gods on earth, but monsters and criminals, and their life has been meaningless, without credibility and honor.
http://jessescrossroadscafe.blogspot.kr/2012/08/chris-hedges-on-empire-of-illusion.html
From Jesse's Cafe:
I came across a nice, compact interview with Chris Hedges which illuminates his thesis of the decline of the American Empire and the illusions and the end of rational thinking that accompanies it. Empires seem to give off quite a bit of flash in their latter stages, rather like the last gasp of a dying star.
The interviewer does a particularly nice job of drawing Hedges out.
I would like to add an observation I made in thinking further this afternoon about the Sophie Scholl piece I put up earlier this morning. There is something about gardening that focuses the mind.
The almost frenetic preoccupation and adherence to the Nazi ideology in the latter stages of the war, when it was obvious to any rational observer that they could not win, is remarkable. I had been particularly struck in my reading some time ago with the 'wolf packs' of Nazis who had raged through Berlin, rounding up old men and even boys who had not joined the Volkssturm, and hanging them, even while the Russians were shelling the Reichstag. It never made sense to me until today.
"The radio announced that Hitler had come out of his safe bomb-proof bunker to talk with the fourteen to sixteen year old boys who had 'volunteered' for the 'honor' to be accepted into the SS and to die for their Fuhrer in the defense of Berlin. What a cruel lie! These boys did not volunteer, but had no choice, because boys who were found hiding were hanged as traitors by the SS as a warning that, 'he who was not brave enough to fight had to die.'I was reminded of this phenomenon by the trial of Sophie Scholl, and her words to the judge Roland Freisler, as he ranted his virulent condemnations at them. 'Soon you will be in our place,' she said to him. He did escape the hangman's noose at Nuremburg, but only by virtue of an Allied bomb in 1945. When his body was brought to hospital an orderly remarked, 'It was God's verdict.' He was buried in an unmarked grave, without ceremony and unmourned. Much like his beloved Fuhrer.
When trees were not available, people were strung up on lamp posts. They were hanging everywhere, military and civilian, men and women, ordinary citizens who had been executed by a small group of fanatics. It appeared that the Nazis did not want the people to survive because a lost war, by their rationale, was obviously the fault of all of us. We had not sacrificed enough and therefore, we had forfeited our right to live, as only the government was without guilt."
Dorothea von Schwanenfluegel, Eyewitness account, Fall of Berlin 1945
This is an almost perfect illustration of the credibility trap. One cannot allow the illusion to falter, even a little, to the bitter end. And as the fraud fades, the force intensifies, becoming almost rabid. Because that illusion has become the center of a hollowed person's being, their raison d'être, and mythological justification.
If the ideology had been a lie, then they are not heroes and gods on earth, but monsters and criminals, and their life has been meaningless, without credibility and honor.
http://jessescrossroadscafe.blogspot.kr/2012/08/chris-hedges-on-empire-of-illusion.html
Sophie Scholl: The Final Days - The Trial and Death of Die Weiße Rose
From Jesse's Cafe:
The Nazi movement was not a uniquely German event; it is a uniquely human event, and remains as such to this day.
When human beings, for whatever reasons and rationales, decide that it is expedient and necessary to put aside their principles, their conscience, and in the pain of their humanity, make themselves into beasts, then the will to power and the madness is unleashed upon them, their children, and the world. No one, no people, is safe from this awful tragedy.
I have heard it argued that The White Rose movement was in the wrong, because they did in fact violate the laws of Nazi Germany. They did, clearly, for the sake of their conscience. I had become interested in them because of the profound influence which the writings of John Henry Newman had on Sophie Scholl and her fiance Fritz Hartnagel, with regard to the necessity of individual conscience.
It has also been argued that they were foolish, because they were not successful. Success is everything in our world.
They could have stayed in University, found good jobs, and accommodated themselves to the reality of their society, paying lip service to their principles. Go along to get along. Again, only if they were able to still their own hearts and cast themselves into the madness and the abyss.
Why think of such gloomy things on such a fine sunny day?
Because the time grows short, shorter for some of us, but with a definite end in sight. And the powers of this world are never at rest, but prowl like ravening wolves, seeking to devour us.
Do not look to the other fellow and what they may be doing, and spend your time judging others, the more harshly the better. When I see a soul that is lost, it is the hardness of their heart that is telling. First save yourselves, by putting your own hardened heart aside.
How do you know if you are saved? Because there is a love of love in your hearts, that is unmistakable.
If you have the power to prophesy, if you hold convictions with a hardness of steel, and engage in remarkable displays of devotion, but you have no love, you are lost.
And it is almost time to come home. So do not be left in the dark.
http://jessescrossroadscafe.blogspot.kr/2012/08/sophie-scholl-final-days-trial-and.html
The Nazi movement was not a uniquely German event; it is a uniquely human event, and remains as such to this day.
When human beings, for whatever reasons and rationales, decide that it is expedient and necessary to put aside their principles, their conscience, and in the pain of their humanity, make themselves into beasts, then the will to power and the madness is unleashed upon them, their children, and the world. No one, no people, is safe from this awful tragedy.
I have heard it argued that The White Rose movement was in the wrong, because they did in fact violate the laws of Nazi Germany. They did, clearly, for the sake of their conscience. I had become interested in them because of the profound influence which the writings of John Henry Newman had on Sophie Scholl and her fiance Fritz Hartnagel, with regard to the necessity of individual conscience.
It has also been argued that they were foolish, because they were not successful. Success is everything in our world.
They could have stayed in University, found good jobs, and accommodated themselves to the reality of their society, paying lip service to their principles. Go along to get along. Again, only if they were able to still their own hearts and cast themselves into the madness and the abyss.
Why think of such gloomy things on such a fine sunny day?
Because the time grows short, shorter for some of us, but with a definite end in sight. And the powers of this world are never at rest, but prowl like ravening wolves, seeking to devour us.
Do not look to the other fellow and what they may be doing, and spend your time judging others, the more harshly the better. When I see a soul that is lost, it is the hardness of their heart that is telling. First save yourselves, by putting your own hardened heart aside.
How do you know if you are saved? Because there is a love of love in your hearts, that is unmistakable.
If you have the power to prophesy, if you hold convictions with a hardness of steel, and engage in remarkable displays of devotion, but you have no love, you are lost.
And it is almost time to come home. So do not be left in the dark.
http://jessescrossroadscafe.blogspot.kr/2012/08/sophie-scholl-final-days-trial-and.html
Big Outflow Trouble In Not So Little China?
From Zero Hedge:
China has two problems... well more than two we are sure, but these seem critical.
First, there is a significantly slowing economy that 'desperately' needs the hand-of-god Central-Banker to stimulate it with free-money - but is hand-cuffed by the huge disconnect between 'apparently' low CPI and extreme highs in food and energy prices which will only exaggerate spending retrenchment should any money-printing be enabled.
Second, it seems for many investors the writing is on the wall as money is flowing out of the world's growth engine faster than oil from a wok. While at the surface USDCNY appears to be doing its 'stable' thing - the PBOC is soaking up unprecedented amounts of CNY as the market 'sells' out.
This chart (that we previously discussed in detail here) shows the difference between market-driven movements in USDCNY (red) and PBOC-driven (blue) - clearly the market is selling its CNY and running away and while we are sure China would like a lower Yuan (to help exports etc.) it is nevertheless band-ridden and needs to maintain some stability or trade-wars or worse will escalate - so the PBOC is soaking up massive amounts of Yuan (and selling out its USD?) to maintain that illusion of control...
This combination of slowing (and seemingly unstoppable) economic trajectory with significant negative money-flows is a vicious circle.
http://www.zerohedge.com/news/big-outflow-trouble-not-so-little-china
China has two problems... well more than two we are sure, but these seem critical.
First, there is a significantly slowing economy that 'desperately' needs the hand-of-god Central-Banker to stimulate it with free-money - but is hand-cuffed by the huge disconnect between 'apparently' low CPI and extreme highs in food and energy prices which will only exaggerate spending retrenchment should any money-printing be enabled.
Second, it seems for many investors the writing is on the wall as money is flowing out of the world's growth engine faster than oil from a wok. While at the surface USDCNY appears to be doing its 'stable' thing - the PBOC is soaking up unprecedented amounts of CNY as the market 'sells' out.
This chart (that we previously discussed in detail here) shows the difference between market-driven movements in USDCNY (red) and PBOC-driven (blue) - clearly the market is selling its CNY and running away and while we are sure China would like a lower Yuan (to help exports etc.) it is nevertheless band-ridden and needs to maintain some stability or trade-wars or worse will escalate - so the PBOC is soaking up massive amounts of Yuan (and selling out its USD?) to maintain that illusion of control...
This combination of slowing (and seemingly unstoppable) economic trajectory with significant negative money-flows is a vicious circle.
http://www.zerohedge.com/news/big-outflow-trouble-not-so-little-china
지방경제, 금융위기 이후 최악
내일신문으로부터:
지방경제가 금융위기 이후 최악의 경기 둔화를 맞고 있다. 서울을 제외한 지방의 2분기 제조업생산 증가율은 2009년 3분기 이래 최저이고, 수출증가율은 첫 마이너스를 기록했다.
지방경제의 버팀목이던 건설경기도 크게 나빠진 것으로 나타나는가 하면 투자, 소비 모두 악화됐다. 상대적으로 양호한 고용사정을 빼고는 긍정적인 지표가 전무했다.
24일 한국은행이 발표한 '최근의 지방경제동향'에 따르면 제조업생산 증가율은 1분기 4.4%에서 2분기 1.6%로 떨어졌다. 이는 지난 2009년 3분기에 5.0%를 기록한 이래 2년 6개월 만에 가장 낮은 수준이다. 부산 울산 경남, 대전 충청, 대구 경북권을 중심으로 자동차, 기계, 컴퓨터, 전자부품 등이 부진한 탓이 컸다.
수출은 마이너스를 기록했다. 1분기에도 지난해 동기보다 1.6% 늘어 턱걸이를 했던 수출증가율은 2분기에 -2.2%로 떨어졌다. 지방의 수출증가율이 마이너스로 전환한 것은 2009년 3분기(-19.6%) 이후 처음이다. 자동차 수출의 증가율이 줄어든데다 석유 제품의 수출증가율이 마이너스로 내려간 탓이다.
http://www.naeil.com/News/politics/ViewNews.asp?sid=E&tid=9&nnum=676746
지방경제가 금융위기 이후 최악의 경기 둔화를 맞고 있다. 서울을 제외한 지방의 2분기 제조업생산 증가율은 2009년 3분기 이래 최저이고, 수출증가율은 첫 마이너스를 기록했다.
지방경제의 버팀목이던 건설경기도 크게 나빠진 것으로 나타나는가 하면 투자, 소비 모두 악화됐다. 상대적으로 양호한 고용사정을 빼고는 긍정적인 지표가 전무했다.
24일 한국은행이 발표한 '최근의 지방경제동향'에 따르면 제조업생산 증가율은 1분기 4.4%에서 2분기 1.6%로 떨어졌다. 이는 지난 2009년 3분기에 5.0%를 기록한 이래 2년 6개월 만에 가장 낮은 수준이다. 부산 울산 경남, 대전 충청, 대구 경북권을 중심으로 자동차, 기계, 컴퓨터, 전자부품 등이 부진한 탓이 컸다. 수출은 마이너스를 기록했다. 1분기에도 지난해 동기보다 1.6% 늘어 턱걸이를 했던 수출증가율은 2분기에 -2.2%로 떨어졌다. 지방의 수출증가율이 마이너스로 전환한 것은 2009년 3분기(-19.6%) 이후 처음이다. 자동차 수출의 증가율이 줄어든데다 석유 제품의 수출증가율이 마이너스로 내려간 탓이다.
http://www.naeil.com/News/politics/ViewNews.asp?sid=E&tid=9&nnum=676746
Friday, August 24, 2012
For Marc Faber The Iron 'Ore' Lady Has Sung
From Zero Hedge:
Frustrated with the know-it-all bullish 'experts' on the Chinese economy lambasting wise boots-on-the-ground deep-thinkers such as Hugh Hendry and Albert Edwards; Marc Faber (who discussed this in detail in the clip we presented here) today set about correcting some of that vacuous chatter on China's dominance (with all its current stuffed inventory). Noting that the Chinese stock market is not exactly pointing to the growth everyone is relying on (and we add since the MAR09 lows it is only fractionally better than Spain), Faber brings up one chart (courtesy of The Bank Credit Analyst) to rule them all. Alongside the mega-bubbles of: Gold in 1970s, the Nikkei in the 80s, and the Nasdaq in the 90s, Iron Ore prices since the start of 2000 have them all beat - and recently (as we noted here) have begun to roll over.
as Faber adds:
Frustrated with the know-it-all bullish 'experts' on the Chinese economy lambasting wise boots-on-the-ground deep-thinkers such as Hugh Hendry and Albert Edwards; Marc Faber (who discussed this in detail in the clip we presented here) today set about correcting some of that vacuous chatter on China's dominance (with all its current stuffed inventory). Noting that the Chinese stock market is not exactly pointing to the growth everyone is relying on (and we add since the MAR09 lows it is only fractionally better than Spain), Faber brings up one chart (courtesy of The Bank Credit Analyst) to rule them all. Alongside the mega-bubbles of: Gold in 1970s, the Nikkei in the 80s, and the Nasdaq in the 90s, Iron Ore prices since the start of 2000 have them all beat - and recently (as we noted here) have begun to roll over.
as Faber adds:
http://www.zerohedge.com/news/marc-faber-iron-ore-lady-has-sungAll these indicators [which he discusses at length from electricity production to Macau gaming revenues and consumer spending habits to appliance and air-conditioning volumes] do not necessarily suggest that the Chinese economy is collapsing, but they reliably do suggest that the economic slowdown is more pronounced than official Chinese statistics would have you believe. In addition, these indicators do not imply that the Chinese stock market will decline further (but it could). Perhaps the weak performance since 2008 has already discounted much of the slowdown in economic growth.
China Has Become One Big "Stuffed Channel"
From Zero Hedge:
Zero Hedge covered the topic of automotive channel stuffing long before it became a conversation piece, particularly as it pertains to Government Motors, a story which has recently taken precedence after being uncovered at such stalwarts of industry as German BMW and Mercedes, implying the German economic miracle may, too, have been largely fabricated. Another core topic over the years has been the artificial and inventory-stockpiling driven (in other words hollow) "growth" of China's economy, whose masking has been increasingly more difficult courtesy of such telltale signs of a slowdown as declining electricity consumption and off the charts concrete use. It was only logical that the themes would eventually collide and so they have: the New York Times published "China Besieged by Glut of Unsold Goods" in which, as the title implies, it is revealed that China is now nothing more than one big "stuffed channel."
As for China, we wish it luck in further easing to provide more supply-driven push for its channel-stuffed economy: with $14 trillion in deposits, or $5+ trillion more than the US, which can rush out at a moment's notice, and buy everything that is not nailed down (and certainly gold) at the faintest whiff of inflation, and record high soybean prices which we discussed previously will keep the PBOC on hold far longer than most experts predict, all those rumors of a China hard landing are increasingly becoming facts.
http://www.zerohedge.com/news/china-has-become-one-big-stuffed-channel
Zero Hedge covered the topic of automotive channel stuffing long before it became a conversation piece, particularly as it pertains to Government Motors, a story which has recently taken precedence after being uncovered at such stalwarts of industry as German BMW and Mercedes, implying the German economic miracle may, too, have been largely fabricated. Another core topic over the years has been the artificial and inventory-stockpiling driven (in other words hollow) "growth" of China's economy, whose masking has been increasingly more difficult courtesy of such telltale signs of a slowdown as declining electricity consumption and off the charts concrete use. It was only logical that the themes would eventually collide and so they have: the New York Times published "China Besieged by Glut of Unsold Goods" in which, as the title implies, it is revealed that China is now nothing more than one big "stuffed channel."
As for China, we wish it luck in further easing to provide more supply-driven push for its channel-stuffed economy: with $14 trillion in deposits, or $5+ trillion more than the US, which can rush out at a moment's notice, and buy everything that is not nailed down (and certainly gold) at the faintest whiff of inflation, and record high soybean prices which we discussed previously will keep the PBOC on hold far longer than most experts predict, all those rumors of a China hard landing are increasingly becoming facts.
http://www.zerohedge.com/news/china-has-become-one-big-stuffed-channel
Thursday, August 23, 2012
China Flash PMI Plummets As New Export Orders Collapse To Lehman Lows
From Zero Hedge:
It was the best of times (US equities); it was the worst of times (the world's growth engine - China). HSBC-Markit just announced the Flash PMI for August and it's not pretty - printing at a nine-month low (47.8 vs 49.3 in July). Of course, China's own version remains in the Schrodinger-like >50-expansion state for now but with all 11 sub-indices in this evening's data pointing to weakness, we suspect not even the Chinese can sell that data for much longer. So what next - RRR? Massive stimulus? - don't hold your breath given the recent reverse repos and the already creeping-inflation in food and energy prices. The piece-de-resistance of the data-dump though has to be (in line with Japan's trade data last night) is the New Export Orders slumped to 44.7 - lowest since March 2009 when trade finance collapsed post-Lehman.
http://www.zerohedge.com/news/china-flash-pmi-plummets-new-export-orders-collapse-lehman-lows
It was the best of times (US equities); it was the worst of times (the world's growth engine - China). HSBC-Markit just announced the Flash PMI for August and it's not pretty - printing at a nine-month low (47.8 vs 49.3 in July). Of course, China's own version remains in the Schrodinger-like >50-expansion state for now but with all 11 sub-indices in this evening's data pointing to weakness, we suspect not even the Chinese can sell that data for much longer. So what next - RRR? Massive stimulus? - don't hold your breath given the recent reverse repos and the already creeping-inflation in food and energy prices. The piece-de-resistance of the data-dump though has to be (in line with Japan's trade data last night) is the New Export Orders slumped to 44.7 - lowest since March 2009 when trade finance collapsed post-Lehman.
http://www.zerohedge.com/news/china-flash-pmi-plummets-new-export-orders-collapse-lehman-lows
Eric Sprott: The Financial System’s Death Knell?
From Zero Hedge:
Under widespread NIRP, pensions, annuities, insurers, banks and ultimately all savers will suffer a slow but steady decline in real wealth over time. Just as ZIRP has stuck around since the early 2000’s, NIRP may be here to stay for many years to come. Looking back at how much widespread damage ZIRP has caused since its introduction back in 2002, it’s hard not to expect that negative interest rates will cause even more harm, and at a faster clip. In our view, NIRP represents the death knell for the financial system as we know it today. There are simply too many working parts of the financial industry that are directly impacted by negative rates, and as long as NIRP persists, they will be helplessly stuck suffering from its ill-effects.
http://www.zerohedge.com/news/eric-sprott-financial-system%E2%80%99s-death-knell
Under widespread NIRP, pensions, annuities, insurers, banks and ultimately all savers will suffer a slow but steady decline in real wealth over time. Just as ZIRP has stuck around since the early 2000’s, NIRP may be here to stay for many years to come. Looking back at how much widespread damage ZIRP has caused since its introduction back in 2002, it’s hard not to expect that negative interest rates will cause even more harm, and at a faster clip. In our view, NIRP represents the death knell for the financial system as we know it today. There are simply too many working parts of the financial industry that are directly impacted by negative rates, and as long as NIRP persists, they will be helplessly stuck suffering from its ill-effects.
http://www.zerohedge.com/news/eric-sprott-financial-system%E2%80%99s-death-knell
Marc Faber On Keynesian Folly, The 'Missing' Inflation, And Bubble-Blowing
From Zero Hedge:
In as-comprehensive-an-explanation-as-we-have-seen of the monetary malfeasance and misunderstanding of the standard Keynesian central-banker, Gloom-Boom-Doom's Marc Faber addressed an instutional audience in the Middle East earlier this year. Faber begins by explaining his (correct) view that 'Keynesian' intervention into the free-market or capitalistic society (with fiscal and monetary measures), in order to 'smooth' the business cycle, has in fact created a more violent business cycle - as they attempt to address long-term structural problems with short-term fixes (or bubbles). His lecture expands from his insight that in 1970 not a single investment bank was public - they were all private partnerships (implicitly playing with their own money as opposed to other-people's - dramatically impacting the risk profile in the world) to the notion that central bank money printing (pushing dollars out the door) does have inflationary symptoms - but they do not necessarily have to show up in wages or CPI in the US (think Chinese wage inflation, or commodity price rises, or Aussie housing bubbles). Central bankers can determine the quantity of money but they cannot determine what we do with those USD bills. Must watch.
http://www.zerohedge.com/news/marc-faber-keynesian-folly-missing-inflation-and-bubble-blowing
In as-comprehensive-an-explanation-as-we-have-seen of the monetary malfeasance and misunderstanding of the standard Keynesian central-banker, Gloom-Boom-Doom's Marc Faber addressed an instutional audience in the Middle East earlier this year. Faber begins by explaining his (correct) view that 'Keynesian' intervention into the free-market or capitalistic society (with fiscal and monetary measures), in order to 'smooth' the business cycle, has in fact created a more violent business cycle - as they attempt to address long-term structural problems with short-term fixes (or bubbles). His lecture expands from his insight that in 1970 not a single investment bank was public - they were all private partnerships (implicitly playing with their own money as opposed to other-people's - dramatically impacting the risk profile in the world) to the notion that central bank money printing (pushing dollars out the door) does have inflationary symptoms - but they do not necessarily have to show up in wages or CPI in the US (think Chinese wage inflation, or commodity price rises, or Aussie housing bubbles). Central bankers can determine the quantity of money but they cannot determine what we do with those USD bills. Must watch.
http://www.zerohedge.com/news/marc-faber-keynesian-folly-missing-inflation-and-bubble-blowing
Wednesday, August 22, 2012
Why Chinese Inflation Risk Is Over Three Times Greater Than In America
From Zero Hedge:
As everyone awaits (or doubts) the next coordinated central planning bank action - whether Fed QE (Lockhart stymied?), ECB 'bottomless pockets' (Merkel's back), or China RRR (reverse repos?) - the prices of things we need (as opposed to want) continue to rise. Nowhere is this more important than in China with its extremely high levels (and volatility) of deposit flows increasingly levered to re-inflationary actions by the PBoC. The critical aspect of the following analysis is that in the US, the stock market acts as an 'inflation buffer' for the rich's excess disposable income; in China, this is not the case and given the greater than 3.4x leverage compared to the US, PBoC actions flow much more rapidly through the populace to the things they need - and right now more inflation is not what they need or want - which perhaps explains the reverse-repo 'gradual' tightening.
http://www.zerohedge.com/news/why-chinese-inflation-risk-over-three-times-greater-america
As everyone awaits (or doubts) the next coordinated central planning bank action - whether Fed QE (Lockhart stymied?), ECB 'bottomless pockets' (Merkel's back), or China RRR (reverse repos?) - the prices of things we need (as opposed to want) continue to rise. Nowhere is this more important than in China with its extremely high levels (and volatility) of deposit flows increasingly levered to re-inflationary actions by the PBoC. The critical aspect of the following analysis is that in the US, the stock market acts as an 'inflation buffer' for the rich's excess disposable income; in China, this is not the case and given the greater than 3.4x leverage compared to the US, PBoC actions flow much more rapidly through the populace to the things they need - and right now more inflation is not what they need or want - which perhaps explains the reverse-repo 'gradual' tightening.
http://www.zerohedge.com/news/why-chinese-inflation-risk-over-three-times-greater-america
What Happened After Europe's Last Three Currency "Unions" Collapsed
From Zero Hedge:
It may come as a surprise to some of our younger readers, that the Eurozone, and its associated currency, is merely the latest in a long series of failed attempts to create a European currency union and a common currency. Three of the most notable predecessors to the EUR include the Hapsburg Empire, the Soviet Union, and Yugoslavia. Obviously, these no longer exist. Just as obvious, all of these unions, having spent time, energy, money, and effort to change the culture and traditions of member countries and to perpetuate said unions, had no desire, just like Brussels nowadays, to see these unions implode. The question then is: what happened after these multi-nation currency unions fails. VOX kindly answers: "they all ended with disastrous hyperinflation."
http://www.zerohedge.com/news/what-happened-after-europes-last-three-currency-unions-collapsed
It may come as a surprise to some of our younger readers, that the Eurozone, and its associated currency, is merely the latest in a long series of failed attempts to create a European currency union and a common currency. Three of the most notable predecessors to the EUR include the Hapsburg Empire, the Soviet Union, and Yugoslavia. Obviously, these no longer exist. Just as obvious, all of these unions, having spent time, energy, money, and effort to change the culture and traditions of member countries and to perpetuate said unions, had no desire, just like Brussels nowadays, to see these unions implode. The question then is: what happened after these multi-nation currency unions fails. VOX kindly answers: "they all ended with disastrous hyperinflation."
http://www.zerohedge.com/news/what-happened-after-europes-last-three-currency-unions-collapsed
Tuesday, August 21, 2012
The World's Biggest Hedge Fund Hotel Just Became The Biggest Ever - 230 Hedge Funds Own Apple As Of June 30
From Zero Hedge:
Three months ago when we looked at the latest quarterly hedge fund position tracker from GS, we were not surprised to learn that a record 226 hedge funds were long AAPL stock. And as the chart below proves, a major driver of the increasing price of Apple stock is that increasingly more hedge funds continue to simply pile into the name, which in times of underperformance, such as now with just 11% of hedge funds outperforming the S&P as reported yesterday, is a short-cut means to generating modestly low-risk, high beta due to the collusive nature of all HFs rushing into the safety of one name all at the same time, that at least has some (arguably tenuous if indeed the leaked iPhone 5 photos are of the final thing) fundamentals propping the stock price. Sure enough, in the latest update, the hedge fund hotel California just got bigger once again for the 6th consecutive time, and as of June 30 a record 230 hedge funds were long the stock. We can only imagine how many more peripheral underperforming funds have joined the biggest hedge fund crowd ever since June 30 and have scrambled into the one stock that provides even a modest reprieve from the certainty of career-ending redemption requests come as soon as the September 30 redemption deadline, which is less than one short month away.
http://www.zerohedge.com/news/worlds-biggest-hedge-fund-hotel-just-became-biggest-ever-230-hedge-funds-own-apple-june-30
Three months ago when we looked at the latest quarterly hedge fund position tracker from GS, we were not surprised to learn that a record 226 hedge funds were long AAPL stock. And as the chart below proves, a major driver of the increasing price of Apple stock is that increasingly more hedge funds continue to simply pile into the name, which in times of underperformance, such as now with just 11% of hedge funds outperforming the S&P as reported yesterday, is a short-cut means to generating modestly low-risk, high beta due to the collusive nature of all HFs rushing into the safety of one name all at the same time, that at least has some (arguably tenuous if indeed the leaked iPhone 5 photos are of the final thing) fundamentals propping the stock price. Sure enough, in the latest update, the hedge fund hotel California just got bigger once again for the 6th consecutive time, and as of June 30 a record 230 hedge funds were long the stock. We can only imagine how many more peripheral underperforming funds have joined the biggest hedge fund crowd ever since June 30 and have scrambled into the one stock that provides even a modest reprieve from the certainty of career-ending redemption requests come as soon as the September 30 redemption deadline, which is less than one short month away.
http://www.zerohedge.com/news/worlds-biggest-hedge-fund-hotel-just-became-biggest-ever-230-hedge-funds-own-apple-june-30
Mark McHugh: Shhhh… It’s Even Worse Than The Great Depression
From Zero Hedge:
In just four short years, our “enlightened” policy-makers have slowed money velocity to depths never seen in the Great Depression. Hard to believe, but the guy who made a career out of Monday-morning quarterbacking the Great Depression has already proven himself a bigger idiot than all of his predecessors (and in less than half the time!!). During the Great Depression, monetary base was expanded in response to slowing economic activity, in other words it was reactive (here’s a graph) . They waited until the forest was ablaze before breaking out the hoses, and for that they’ve been rightly criticized. Our “proactive” Fed elected to hose down a forest that wasn’t actually on fire, with gasoline, and the results speak for themselves. With the IMF recently lowering its 2012 US GDP growth forecast to 2%, while the monetary base is expanding at about a 5% clip, know that velocity of money is grinding lower every time you breathe.
http://www.zerohedge.com/news/guest-post-shhhh%E2%80%A6-it%E2%80%99s-even-worse-great-depression
In just four short years, our “enlightened” policy-makers have slowed money velocity to depths never seen in the Great Depression. Hard to believe, but the guy who made a career out of Monday-morning quarterbacking the Great Depression has already proven himself a bigger idiot than all of his predecessors (and in less than half the time!!). During the Great Depression, monetary base was expanded in response to slowing economic activity, in other words it was reactive (here’s a graph) . They waited until the forest was ablaze before breaking out the hoses, and for that they’ve been rightly criticized. Our “proactive” Fed elected to hose down a forest that wasn’t actually on fire, with gasoline, and the results speak for themselves. With the IMF recently lowering its 2012 US GDP growth forecast to 2%, while the monetary base is expanding at about a 5% clip, know that velocity of money is grinding lower every time you breathe.
http://www.zerohedge.com/news/guest-post-shhhh%E2%80%A6-it%E2%80%99s-even-worse-great-depression
John Aziz: Is Apple Really Worth More Than The Sum Of Microsoft, Dell, Google, Facebook And HP?
From Zero Hedge:
The data suggests that relative to other tech companies AAPL is significantly overvalued. And going forward there is no guarantee that AAPL can justify today’s value by keeping up its dominance of the sector. Tech is an extremely fickle and fast-changing sector where one year’s turkey can be next year’s prize pig. And AAPL’s product lineup is still dominated by products developed under the charge of Steve Jobs — it will take a while longer to fully assess whether or not AAPL can succeed at the same magnitude over the entire product cycle from conception to sales without his leadership.
http://www.zerohedge.com/news/guest-post-apple-really-worth-more-sum-microsoft-dell-google-facebook-and-hp
The data suggests that relative to other tech companies AAPL is significantly overvalued. And going forward there is no guarantee that AAPL can justify today’s value by keeping up its dominance of the sector. Tech is an extremely fickle and fast-changing sector where one year’s turkey can be next year’s prize pig. And AAPL’s product lineup is still dominated by products developed under the charge of Steve Jobs — it will take a while longer to fully assess whether or not AAPL can succeed at the same magnitude over the entire product cycle from conception to sales without his leadership.
http://www.zerohedge.com/news/guest-post-apple-really-worth-more-sum-microsoft-dell-google-facebook-and-hp
Wednesday, August 15, 2012
Presenting The Shocking Source Of US Treasury Demand In The Past Year
As I mentioned many times, changes in the U.S. treasury holdings are important from a macro perspective. Japan and China could rise so fast with their exports to the U.S. due to their U.S. treasury holdings.
From Zero Hedge:
When one thinks US Treasurys, and demand thereof, two entities pop into mind: the Federal Reserve, which over the past 3 years has been the biggest institutional buyer of US paper, and China, which is the largest foreign holder of US TSYs. Yet over the past year something curious happened: when it comes to setting marginal demand for US Treasurys, it was neither the Fed, whose sterilized Operation Twist has kept its holdings of US Tsys relatively flat, nor China, which has actually been a major seller of US paper, that has been the dominant source of marginal demand for Uncle Sam's never to be repaid obligations. Japan.
That's right, as the chart below shows using TIC data, even as China was quietly selling its paper (and that accounts for UK holdings, aka Chinese offshore operations) in the beginning of the year, taking its total from over $1.3 trillion to $1.15 trillion in December, where it has stayed without moving at all in 2012 as China entered a buyer's strike mode, it was Japan who quickly stepped in to fill the void. And what a void it has filled. According to TIC data, Japanese holdings of US paper have soared from $882 billion in June 2011 to a whopping $1119 billion a year later. In the process the spread between Chinese and Japanese holdings of US TSYs has collapsed from $430 billion to a tiny $43 billion and at this rate Japan will overtake China as the top foreign holder of US paper within 3-4 months!
http://www.zerohedge.com/news/presenting-shocking-source-us-treasury-demand-past-year
From Zero Hedge:
When one thinks US Treasurys, and demand thereof, two entities pop into mind: the Federal Reserve, which over the past 3 years has been the biggest institutional buyer of US paper, and China, which is the largest foreign holder of US TSYs. Yet over the past year something curious happened: when it comes to setting marginal demand for US Treasurys, it was neither the Fed, whose sterilized Operation Twist has kept its holdings of US Tsys relatively flat, nor China, which has actually been a major seller of US paper, that has been the dominant source of marginal demand for Uncle Sam's never to be repaid obligations. Japan.
That's right, as the chart below shows using TIC data, even as China was quietly selling its paper (and that accounts for UK holdings, aka Chinese offshore operations) in the beginning of the year, taking its total from over $1.3 trillion to $1.15 trillion in December, where it has stayed without moving at all in 2012 as China entered a buyer's strike mode, it was Japan who quickly stepped in to fill the void. And what a void it has filled. According to TIC data, Japanese holdings of US paper have soared from $882 billion in June 2011 to a whopping $1119 billion a year later. In the process the spread between Chinese and Japanese holdings of US TSYs has collapsed from $430 billion to a tiny $43 billion and at this rate Japan will overtake China as the top foreign holder of US paper within 3-4 months!
http://www.zerohedge.com/news/presenting-shocking-source-us-treasury-demand-past-year
Aaaand It's Gone: This Is Why You Always Demand Physical
From Zero Hedge:
We have said it over and over, we'll say it again. For all those who for one reason or another would like to boycott the broken markets, yet trade gold in paper form, please understand that all the invested capital is at risk of total loss and can and will be lost, commingled and rehypothecated, not necessarily in that order, with little to zero recourse and the residual claim on liquidating assets pushed to the very end of the queue. Because if Lehman, MF Global, Peregrine, and countless other examples were not enough, here comes Amber Gold: a gold-based investment ponzi scheme out of Poland, in which it is likely needless to say that the gullible investors never had actual possession of the gold. And when they tried, it was gone. All gone.
http://www.zerohedge.com/news/and-why-you-always-demand-physical
We have said it over and over, we'll say it again. For all those who for one reason or another would like to boycott the broken markets, yet trade gold in paper form, please understand that all the invested capital is at risk of total loss and can and will be lost, commingled and rehypothecated, not necessarily in that order, with little to zero recourse and the residual claim on liquidating assets pushed to the very end of the queue. Because if Lehman, MF Global, Peregrine, and countless other examples were not enough, here comes Amber Gold: a gold-based investment ponzi scheme out of Poland, in which it is likely needless to say that the gullible investors never had actual possession of the gold. And when they tried, it was gone. All gone.
http://www.zerohedge.com/news/and-why-you-always-demand-physical
Tuesday, August 14, 2012
Deep Fried Black Swan Lands As China Admits It Has A Food Inflation Problem, Releases Corn, Rice From Reserves
From Zero Hedge:
Last week we wrote an article that to many was anathema: namely an explanation why everyone is deluding themselves in their expectation that the PBOC would ease, soft, hard, or just right landing notwithstanding. The reason? The threat that food inflation is about to read its ugly head which is "Why The Fate Of The Global Equity Rally May Rest In The Hands Of Soybeans." This was merely a continuation of our observations from a month ago that as a result of the Black Swan being "deep fried" in 2012, that the threat of food inflation will keep key BRIC central banks in check for a long time. As of today the threat has become fact, because as China Daily reports "China will release corn and rice from state reserves to help tame inflation and reduce imports as the worst US drought in half a century pushes corn prices to global records, creating fears of a world food crisis...The release may prompt Chinese importers to cancel shipments in the near term and take some pressure off international corn prices, which set a new all-time high on Friday as the US government slashed its estimate of the size of the crop in the world's top grain exporter." Sure, as every other short-termist measure the world over, it may help with prices in the short-term, but will merely expose China, and thus everyone, to the threat of a much greater price spike in the future. Because just as the strategic petroleum reserve release did nothing to help gas prices, nor the short selling ban in the US and Europe did anything to help the underlying broken financial system, so this will merely force the local population to scramble and ration whatever food they can get asap, now that the government has admitted there is, indeed, a food inflationary problem.
http://www.zerohedge.com/news/deep-fried-black-swan-lands-china-admits-it-has-food-inflation-problem-releases-corn-rice-reser?tw_p=twt
Last week we wrote an article that to many was anathema: namely an explanation why everyone is deluding themselves in their expectation that the PBOC would ease, soft, hard, or just right landing notwithstanding. The reason? The threat that food inflation is about to read its ugly head which is "Why The Fate Of The Global Equity Rally May Rest In The Hands Of Soybeans." This was merely a continuation of our observations from a month ago that as a result of the Black Swan being "deep fried" in 2012, that the threat of food inflation will keep key BRIC central banks in check for a long time. As of today the threat has become fact, because as China Daily reports "China will release corn and rice from state reserves to help tame inflation and reduce imports as the worst US drought in half a century pushes corn prices to global records, creating fears of a world food crisis...The release may prompt Chinese importers to cancel shipments in the near term and take some pressure off international corn prices, which set a new all-time high on Friday as the US government slashed its estimate of the size of the crop in the world's top grain exporter." Sure, as every other short-termist measure the world over, it may help with prices in the short-term, but will merely expose China, and thus everyone, to the threat of a much greater price spike in the future. Because just as the strategic petroleum reserve release did nothing to help gas prices, nor the short selling ban in the US and Europe did anything to help the underlying broken financial system, so this will merely force the local population to scramble and ration whatever food they can get asap, now that the government has admitted there is, indeed, a food inflationary problem.
http://www.zerohedge.com/news/deep-fried-black-swan-lands-china-admits-it-has-food-inflation-problem-releases-corn-rice-reser?tw_p=twt
The Keys To Understanding The Collapse Of The Status Quo - Credibility And Expectations
From Of Two Minds:
Can anyone seriously claim the European Union, the European Central Bank and its alphabet-soup programs still retain a shred of credibility? Every EU/ECB "save" is fictitious, every "fix" expedient, every promise empty, every face-saving summit a living lie.
Ultimately, all the posturing, promises and saves come down to an impossibility: "rescuing" phantom assets purchased with astounding levels of debt by issuing even more astounding levels of debt.
Does anyone truly believe this absurdity is anything more than a transparent fraud designed to extend the life of a failed, corrupt system constructed on fantasies and lies?
Those with assets are fleeing for less fantastic and dangerous climes. The handful of French millionaires who are supposed to magically bail out a failed-state that absorbs 55% of GDP are busy transferring their assets out of France, a mass exodus of capital that is also playing out in China, where those who embraced the slogan "to get rich is glorious" are transferring their wealth, ill-gotten or well-earned, overseas.
So vast is this outflow of wealth that for the first time the outflow of capital from China exceeds the inflow of investment capital. The smart money is exiting, and the last batch of credulous "China story" rubes are dumping their capital down a rathole.
http://www.oftwominds.com/blogaug12/credibility-expectations8-12.html
Can anyone seriously claim the European Union, the European Central Bank and its alphabet-soup programs still retain a shred of credibility? Every EU/ECB "save" is fictitious, every "fix" expedient, every promise empty, every face-saving summit a living lie.
Ultimately, all the posturing, promises and saves come down to an impossibility: "rescuing" phantom assets purchased with astounding levels of debt by issuing even more astounding levels of debt.
Does anyone truly believe this absurdity is anything more than a transparent fraud designed to extend the life of a failed, corrupt system constructed on fantasies and lies?
Those with assets are fleeing for less fantastic and dangerous climes. The handful of French millionaires who are supposed to magically bail out a failed-state that absorbs 55% of GDP are busy transferring their assets out of France, a mass exodus of capital that is also playing out in China, where those who embraced the slogan "to get rich is glorious" are transferring their wealth, ill-gotten or well-earned, overseas.
So vast is this outflow of wealth that for the first time the outflow of capital from China exceeds the inflow of investment capital. The smart money is exiting, and the last batch of credulous "China story" rubes are dumping their capital down a rathole.
http://www.oftwominds.com/blogaug12/credibility-expectations8-12.html
Sunday, August 12, 2012
“My grace is sufficient for you, for my power is made perfect in weakness.”
2 Corinthians 12:9
2 Corinthians 12:9
체력적으로 힘들어 하면서도 포스팅이 자꾸 밀리면 안올리게 되어 다소 무리를 하면서 읽어 보셨으면 하는 포스팅은 선별해서 올리고 있습니다.
한국을 비롯해 전세계에서 들어오시는 분들은 영어가 자유로우시고 intelligent하신 분들로 추정되는데 이 블로그의 주제를 이해해 주시고 아주 오래 전에 포스팅한 포스트들이나 시간이 다소 지난 포스팅들도 클릭해 주셔서 (꽤 좋은 글들이어서) 저도 다시 들어가서 읽어 보곤 합니다. 시간이 지나도 올린 포스트들이 다음 세대에게도 유익할 수 있겠다 싶어 감사한 마음입니다. The ongoing global crisis를 겪고 있는 역사의 한 시점에서 전세계적으로 직면하고 있는 문제점은 아주 비슷하다는 것을 아실 겁니다. 이번 주에 올린 한국의 4대강 사업의 허구를 고발하기 위한 온라인모임의 엄마께서 쓰신 글에서도 나타나듯이 한 사회의 구성원으로서 의무와 책무를 다하면서 사는 것은 용기와 끊임없는 공부와 실천을 필요로 하지 않나 싶습니다.
한국시간으로 지난주 일요일과 토요일, 밤잠을 설쳐가면서 올림픽축구팀에게 응원을 보낸, 광적으로 축구를 좋아하는 국민들에게 우리의 젊은 선수들은 역사상 첫 메달이라는 선물을 안겨주었습니다. 홍명보 감독도 2002년 4강 진출했을 때보다도 더 기뻤다고 했는데 저도 그랬습니다. 프로축구보다 올림픽에서 좋은 성적을 거둔 것이 더 좋았고, 한일전보다 영국과의 경기가 조금 더 재미있었고 마음이 뭉클해지더군요. 축구 종주국과 개최국인 영국 현지에서 심판의 다소 이해가 안가는 판정과 영국팬들의 일방적인 응원에도 아랑곳하지 않고 승부차기까지 간 접전 끝에 이겼으니까요. 일본 선수들도 잘 싸웠고, 부상을 딛고 선전해준 골리 정성룡 선수의 모습도 멋있었고, 그 동안 마음고생이 심했던 박주영 선수의 웃는 얼굴모습을 보는 것도 좋았고 주장으로서 실력과 책임감으로 매 경기 좋은 모습을 보여준 구자철 선수가 쐐기골을 넣고 좋아하는 모습도 보기 좋았습니다. 구자철 선수는 올림픽기간 동안 동료선수들과 함께 지내는 것이 축제같이 좋아서 독일로 혼자 돌아가는게 고통스럽다고 말하더군요. 많은 이들에게 기쁨을 선사해준 우리 선수들 기특하고 대견합니다.
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