Monday 28 March 2011

Moving Left

Baltic Dry Index. 1583 +18 (Thursday)

LIR Gold Target by 2019: $30,000. Revised due to QE.

"The history of fiat money is little more than a register of monetary follies and inflations. Our present age merely affords another entry in this dismal register."

Hans F. Sennholz

From London this morning, the world has rarely looked bleaker. The Keystone Kops seem to be trying to fix Fukushima. German voters seem to have had their fill of a dithering, pro-nuclear, center-right government in Berlin. Portugal may have left it too late for a bailout by Berlin. Italy’s economy is tied to Gaddafi’s side winning in Libya. The UK seems headed for a summer of discontent and rioting. A flaky coalition seems to be living on borrowed time. In the USA, Greenspan’s great real estate bubble seems to be in collapse again. Thanks to rampant Wall Street securitisation fraud, title to up to 15 million US properties are now clouded or unknown. The USA seems wedded to QE programs and trillion and a half yearly deficits forever.

Up first, Stuttgart goes Green. Baden-Wuerttemberg looks likely to lead the fight against nuclear power.

Merkel Loses Key German State on Nuclear Fears

By JUDY DEMPSEY Published: March 27, 2011

BERLIN — Chancellor Angela Merkel’s conservative Christian Democrats on Sunday suffered a major defeat in a historic stronghold in southwestern Germany, where the Green Party appeared poised to head a state government for the first time, according to official preliminary results.

The nuclear calamity in Japan and Mrs. Merkel’s subsequent reversal on nuclear power played a key role in the elections in the southwest state of Baden-Württemberg, where the Christian Democrats have governed since 1953, before Mrs. Merkel, 56, was born.

Most Germans have a deep-seated aversion to nuclear power, and the damage at the Fukushima Daiichi plant in Japan has galvanized opposition. On Saturday, more than 200,000 people took to the streets of four big German cities to protest nuclear power. The news from Japan of soaring radiation levels led the major radio and television newscasts on Sunday.

After the catastrophe in Japan, Mrs. Merkel reversed a pro-nuclear policy that she adopted just last year and temporarily shut down seven of Germany’s 17 nuclear plants. She apparently did not convince voters that her change of policy was sincere.

----If the polls are confirmed, the Greens are in a comfortable position to head a coalition with the Social Democrats in Baden-Württemberg, which has some 11 million residents and is among the most prosperous and successful of Germany’s 16 states.

The Greens were projected to win 24.2 percent of the vote, compared with 11.7 percent in 2006. The Social Democrats were forecast to take 23.5 percent of the votes, little changed from 2006.

----In neighboring Rhineland-Palatinate, where the Social Democrat premier Kurt Beck has governed with an absolute majority since 2006, the Social Democrats suffered sizable losses. Their share of the vote fell to 38 percent on Sunday, from 45.6 percent in 2006.

The Green Party, which failed to get elected to the regional parliament in 2006, won 16.8 percent of the vote. Mr. Beck is expected to ask the Greens to join a coalition with the Social Democrats.

More.

http://www.nytimes.com/2011/03/28/world/europe/28germany.html?_r=1

In US news, nuclear power is in deep trouble with even the Republicans making fast u-turns ahead of next year’s key elections. After yesterday’s muddle and mix-up at Fukushima, public support for new nuclear power plants will probably decline again.

"I must follow the people. Am I not their leader?"

Benjamin Disraeli, 19th century British Prime Minister.

Opposition to Nuclear Power Rises Amid Japanese Crisis

According to the  PEW Reesearch Center Not surprisingly, public support for the increased use of nuclear power has declined amid the ongoing nuclear emergency in Japan. Currently, 39% say they favor promoting the increased use of nuclear power while 52% are opposed. Last October, 47% favored promoting the increased use of nuclear power and the same percentage (47%) was opposed.

Opinion about expanding the use of nuclear power has fluctuated in recent years. However, the current measure matches a previous low in support for increased nuclear power recorded in September 2005 (39% favor, 53% oppose).

The latest national survey by the Pew Research Center for the People & the Press, conducted March 17-20 among 1,004 adults, finds little recent change in opinions about other energy policies – with one notable exception. With the recent surge in gas prices, support for increased offshore oil and gas drilling continues to rebound.

http://www.oceanpowermagazine.net/2011/03/24/opposition-to-nuclear-power-rises-amid-japanese-crisis/

Japan nuclear crisis: Japanese fear blunder over rising levels of radiation

Nuclear officials in Japan caused confusion and worry on Sunday by admitting that radiation readings at the stricken Fukishima power plant were inaccurate

By Danielle Demetriou in Tokyo 3:21PM BST 27 Mar 2011

Initially, levels of radiation in the water at the plant were said to be 10 million times above normal. But officials later retracted that calculation and said the level was 100,000 times normal. The embarrassing admission is the latest in a series of missteps that has undermined the credibility of authorities’ attempts to deal with the plant.

But there is no doubt that there has been a huge leap in radiation within the Fukushima Daiichi power plant in the turbine building of No 2 reactor, where a reading of more than 1,000 millisieverts per hour was reported, the highest since the plant was damaged in the March 11 earthquake and tsunami. Exposure to 100 millisieverts per year is believed to be the lowest level at which cancer risks are evident. A dose of 1,000 millisieverts can cause temporary radiation sickness, including nausea and vomiting.

The Tokyo Electric Power Company (Tepco), the operator of the plant, evacuated workers from the building following the discovery of the rising radiation levels amid speculation that the cause may be damage to the nuclear fuel rods.

“There is a suspicion that the reading for iodine 134 [a radioactive substance] is too high, so we are redoing our tests,” said a spokesman, Takeo Iwamoto. He said that the utility would re-administer tests for all substances detected in the water and update readings “as soon as possible”.

Mr Iwamoto said he could not provide any details on what could have gone wrong with the tests. “We are very sorry for the inconvenience,” he said. He could not say by how much readings were thought to be in error

http://www.telegraph.co.uk/news/worldnews/asia/japan/8409546/Japan-nuclear-crisis-Japanese-fear-blunder-over-rising-levels-of-radiation.html

In UK news, no party having run on a platform of honesty about the economy in last year’s general election, the coalition government is in deep trouble trying to impose its austerity program on a disbelieving public. Luckily for them, anarchists, communists, and the Socialist Worker’s Party thugs hi-jacked the Union’s anti-austerity day of protest. Some backlash effect may help the coalition for a little while. For now the unions still haven’t twigged that on a fiat currency all decisions are purely political. If we can print up £250 billion to bailout the gambling banksters and are rich enough to engage in 3 discretionary wars at the same time, why can’t we print up an extra £100 million and not cut disablement benefits to those unfortunate enough to rely on them? Why do we need to impose austerity on the poorest 10% of the country at all, they never got anything out of the bankster casino. Stay long precious metals held outside of HMG’s reach. I suspect that all to soon we will hear the populist and partially correct argument. I suspect that with the better weather, the coalition will soon be facing much more anarchy and social protest. A fine time for H. M.’s coalition to be cutting back on the police and the army.

"When paper money systems begin to crack at the seams, the run to gold could be explosive."

Harry Browne

Recriminations fly after anti-cuts protests descend into violence

Ministers attack Miliband's backing for marches – as retailers denounce police for not stopping violence

By Jonathan Brown Monday, 28 March 2011

The violent scenes that emerged after Britain's largest demonstration for eight years have sparked a political and practical post-mortem, as businesses and politicians measure up the damage caused.

Critics such as former Metropolitan Police deputy assistant commissioner and Lib Dem mayoral candidate Brian Paddick said there were not enough officers "in the right place at the right time" and that intelligence warning of trouble had been ignored allowing trouble to erupt on Saturday.

Many retailers felt the same yesterday as they removed graffiti from shop fronts and started replacing the smashed windows in the main shopping areas of Piccadilly and Oxford Street. As cleaners removed scrawled slogans – including "fightback" and "Tory scum" – from one of Trafalgar Square's bronze lions, Westminster Council revealed the cost of the clean-up was already "tens of thousands of pounds".

However, Commander Bob Broadhurst defended police presence and planning which put 4,500 officers on the streets and ultimately saw 201 arrested. "I wouldn't call them protesters. They are engaging in criminal activities for their own ends," he said. "We have minimised the damage caused. We'll never have enough officers to protect every building in central London. It cannot be done."

He added that video evidence would be used in an attempt to make arrests in the coming days. Two people have already been charged. 84 people, including 31 police officers, were injured in the violence that replaced the good natured scenes of the earlier TUC-organised march with images of confrontation and damage.

-----Many of those taking part in the worst of the violence employed so-called "black bloc" tactics – wearing black clothing and hiding their faces with scarves and hoods – while others sported anarchist flags. Militants also attacked luxury targets including Fortnum & Mason and the Ritz hotel.

London's deputy mayor, Kit Malthouse, hit out at such groups as "fascist agitators". "They were a nasty bunch of black-shirted thugs and it was pretty obvious they were intent on rampaging around and would be difficult to control," he said yesterday.

The GMB union's leader, Paul Kenny, said the local elections on 5 May should be a referendum on the Government's economic and social policies. "The Government's strategy is wrong, unfair and will not get the country working," he said. "The next step is for the alternative voice to be counted in the ballot box in May. GMB will urge voters to reject unemployment, poverty and cuts in public services."

More.

http://www.independent.co.uk/news/uk/home-news/recriminations-fly-after-anticuts-protests-descend-into-violence-2254755.html

After a few years swinging right, Europe seems to be swinging to the left again under the pressures of austerity and a growing awareness that the current fiat money system is thoroughly corrupt. Anarchy and revolution is fast recipe for wealth destruction. Voting in socialism a recipe for the return of high taxes and high inflation. Europe, as usual, is starting to return to type. Fiat Pounds of Euros anyone?

"Gold would have value if for no other reason than that it enables a citizen to fashion his financial escape from the state."

William F. Rickenbacker

At the Comex silver depositories Friday, final figures were: Registered 41.69 Moz, Eligible 62.35 Moz, Total 104.04 Moz.

+++++

Crooks and Scoundrels Corner.

The bent, the seriously bent, and the totally doubled over.

Today, more on the one size doesn’t fit all, dodgy fiat Euro. After the German election results, any EU nation needing a German bailout better get its bailout request in fast. German voters are slamming shut the doors to bailout cash and the nuclear industry at the same time. A Club Med restructuring looks highly likely now. Does Italy sink with Gaddafi? Does Italy sink the EU?

"Gold bears the confidence of the world's millions, who value it far above the promises of politicians, far above the unbacked paper issued by governments as money substitutes. It has been that way through all recorded history. There is no reason to believe it will lose the confidence of people in the future."

Oakley R. Bramble

Crisis-hit Portugal encouraged to accept eurozone’s bail-out package

The Portuguese government has come under renewed pressure to accept a European bail-out at the start of another crucial week for the eurozone.

8:37PM BST 27 Mar 2011

Ewald Nowotny, a governing council member of the European Central Bank, said Portugal should seek help from Europe after the resignation of the prime minister over austerity measures .

He told reporters: “From a purely economic point of view one could probably recommend it. The domestic political situation in Portugal has clearly worsened ... the head of the government has stepped down.”

Jose Socrates was re-elected leader of Portugal's Socialist party on Sunday, four days after resigning as prime minister, and vowed to run in a parliamentary election on a platform opposing a financial bail-out.

Mr Socrates, who won 93pc of the leadership votes despite the country's political crisis, spared no criticism of the opposition whose rejection of his minority government's austerity measures last week led to his resignation.

----Meanwhile, Ireland is trying to secure an extra €60bn (£52bn) of medium-term funding from the ECB to replace emergency temporary help given to the banking sector by Ireland’s central bank.

The Irish government is determined to secure the funding before the results of “stress tests” on its banks are known. Experts say the tests may show that Ireland’s biggest banks need as much as €15bn to €20bn of extra capital.

Spain’s banks are also being scrutinised by wary investors.

http://www.telegraph.co.uk/finance/economics/8409990/Crisis-hit-Portugal-encouraged-to-accept-eurozones-bail-out-package.html

The monthly Coppock Indicators finished February:

DJIA: +156 Down 05. NASDAQ: +217 Down 11. SP500: +157 Down 4.

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