Baltic Dry Index. 663 +01
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
If all else fails, immortality can always be assured by
spectacular error.
J. K. Galbraith
China-Japan Dispute Over Islands Risks $340 Billion Trade
By Bloomberg News - Sep 18, 2012 4:15 AM GMT
China and Japan’s worst diplomatic crisis since 2005 is
putting at risk a trade relationship that’s tripled in the past decade to more
than $340 billion.
Toyota Motor Corp. (7203) and Nissan Motor Co. halted production at some plants while Panasonic Corp. (6752) reported damage to its operations in China as protesters smashed store fronts and cars in demonstrations sparked by Japan’s purchase last week of islands claimed by both countries. Fast Retailing Co. shuttered 42 Uniqlo shops in China and was the biggest decliner in the benchmark Nikkei 225 index.
Tensions between China and Japan further complicate policy makers’ efforts to fortify growth in Asia’s biggest economies as the European debt crisis saps demand for exports.
Panasonic, Sony Corp. (6758) and Canon Inc. (7751) said they’re shutting some plants in China through today and the China Automobile Dealers Association said the protests will hurt sellers of Toyota, Nissan (7201) and Honda Motor Co. cars in China more than Japan’s March 2011 earthquake.
“The escalating dispute is adding one more layer of uncertainty,” said Liu Li-Gang, a Hong Kong-based economist at Australia & New Zealand Banking Group Ltd. (ANZ), who previously worked at the World Bank. “Japan is now more reliant on China for economic growth than vice versa. Its already weak economic recovery may falter. China will suffer less.”
In 2011, China was the largest market for Japanese exports,
while Japan was the fourth-largest market for Chinese exports. China’s shipments
to Japan totaled $148.3 billion last year while it imported $194.6 billion of
Japanese goods, according to Chinese customs data.
More
Up next, the new reality of a slowing China. Was it all really based on an MF Global hypothecation scheme? Stay long physical precious metals in case it was.
"The London Banker Henry Fauntleroy forged to keep his bank
solvent. He was executed for it in 1824”.
Charles P. Kindleberger, Manias, Panics and Crashes.
Exclusive: Ghost warehouse stocks haunt China's steel sector
(Reuters)
- Chinese banks and companies looking to seize steel pledged as collateral by
firms that have defaulted on loans are making an uncomfortable discovery: the
metal was never in the warehouses in the first place.
China's
demand has faltered with the slowing economy, pushing steel prices to a
three-year low and making it tough for mills and traders to keep up with
payments on the $400 billion of debt they racked up during years of
double-digit growth.
As
defaults have risen in the world's largest steel consumer, lenders have found
that warehouse receipts for metal pledged as collateral do not always lead them
to stacks of stored metal. Chinese authorities are investigating a number of
cases in which steel documented in receipts was either not there, belonged to
another company or had been pledged as collateral to multiple lenders, industry
sources said.
----"What
we have seen so far is just the tip of the iceberg," said a trader from a
steel firm in Shanghai who declined to be identified as he was not authorized
to speak to the media. "The situation will get worse as poor demand,
slumping prices and tight credit from banks create a domino effect on the
industry."
More
Barclays cuts China GDP growth forecast
Updated: 2012-09-17 15:15
Barclays
cut its forecast on China's GDP growth to 7.5 percent this year from its original
7.9 percent estimate, due to the weak August data, the investment bank said in
a research note on Monday.
The
lackluster August data confirmed that China's growth momentum remains weak. The
bank also cut its GDP growth forecast to 7.6 percent, from 8.4 percent, in
2013.
"The
current growth slowdown is a combination of both structural and cyclical
changes, and we think 7-8 percent growth may become the new 'normal',"
said Chang Jian, an economist with the bank.
More
Trade war number two is breaking out between America and China. The world’s biggest debtor is about to give a “Glasgow kiss” to the world’s biggest creditor. Given the state of the American, the Chinese, the European, and Japanese economies, trade wars are the last thing central banks need in trying to revive their stricken casino banking economy’s.
China challenges US bill on countervailing duties
Updated: 2012-09-18 02:27
A US
trade bill that could see tariffs and duties slapped on Chinese exports has
prompted China to request a consultation with the US through the World Trade
Organization.
The bill
entitles the US Department of Commerce to continue levying countervailing
duties on imports from non-market economies like China and Vietnam that it
believes are subsidized.
US
President Barack Obama signed the bill into law in March, despite a decision by
the US Court of Appeals for the Federal Circuit that the US countervailing-duty
law should not be applied to non-market economies.
China and
the US have 60 days for the consultation according to WTO rules.
China
"is willing to solve the dispute through consultation", while a
failure of the consultation will entitle China to ask for a panel to look into
the case, according to an unnamed source from the Department of Treaty and Law
of the Ministry of Commerce.
Tu
Xinquan, deputy director of the China Institute for WTO Studies at the
University of International Business and Economics in Beijing, said the US
passed the law very quickly with little debate, which did not give WTO members
a chance for discussion under WTO rules.
"The
consultation will definitely reach no result because the US Department of
Commerce has no right to overturn a law that had already been enacted at
home," Tu said.
"The
US Congress is unlikely to cancel the law following China’s opposition because
the US seldom steps down from launching anti-dumping and countervailing
investigations against China," Tu said.
Shen
Danyang, spokesman of the ministry, said on the website of China's Ministry of
Commerce that, despite having no legal basis, the US has launched more than 30
countervailing investigations against Chinese exports since 2006, which it
justifies through the law applied retroactively.
"The
US moves violate the WTO rules including transparency and due process and thus
put Chinese enterprises in an uncertain legal environment."
The
transparency rule of the WTO requires its members to publish the enacting and
adoption of trade measures. Any measures that are not published should not be
applied.
More
Back in Euroland, the
ECB’s miracle of the Club Med bonds last week, became this week’s dither, drift
and yet more smoke and mirrors. The euro as we know it is dead, no longer
working for any country out of the Germanic tier, but no European politician’s
yet wish to tell their voters who will be furious at all the wealth destruction
headed their way. Stay long physical precious metals. Events in Asia, America
and Europe are bringing about the end of the Great Nixonian Error of fiat
currency.
In central
banking as in diplomacy, style, conservative tailoring, and an easy association
with the affluent count greatly and results far much less.
J. K. Galbraith
Debt crisis: politicians drive bank union but markets focus on Spain
Spanish borrowing costs rose above 6pc again as a continued stand-off between Madrid and Brussels fuelled fears that the European Central Bank’s bond buying programme pledge is not enough to stabilise the eurozone.
There can be few fields of human endeavour in which history counts for
so little as in the world of finance. Past experience, to the extent that it is
part of memory at all, is dismissed as the primitive refuge of those who do not
have the insight to appreciate the incredible wonders of the present.
J. K. Galbraith
At the Comex silver depositories Monday final figures were: Registered 39.27 Moz,
Eligible 101.54 Moz, Total 140.81 Moz.
Crooks and
Scoundrels Corner
The bent,
the seriously bent, and the totally doubled over.
Today, the troubles
and tribulations of America’s 1%, as they try to hide and protect their true
wealth from Uncle Sam’s larcenous eyes. Would America be where it is today
without such nonsense schemes? The whole
colourful article is worth a read.
Only the
little people pay taxes.
Leona
Helmsley.
America’s Fourth-Richest Woman Unveiled With Koch Stake
By David
de Jong - Sep 17, 2012 3:15 PM GMT
For the past six years, Elaine Tettemer
Marshall, the fourth-richest woman in the U.S., has avoided the spotlight that
ordinarily accompanies great wealth.
The 70-year-old Dallas resident controls almost 15 percent of Koch Industries Inc., the second-largest closely held company in the U.S. Her stake in the Wichita, Kansas-based industrial conglomerate, which generates annual sales of $110 billion, is worth more than $12.7 billion, according to the Bloomberg Billionaires Index, which has expanded to 100 names. The only American women richer are Wal-Mart Stores Inc. (WMT) heiresses Alice and Christy Walton, and 71-year-old candy scion Jacqueline Mars.
Marshall, who gained control of the Koch stake following the death of her husband, E. Pierce Marshall, in 2006, has never appeared on an international wealth ranking, although her estate has been at the center of two U.S. Supreme Court cases involving her mother-in-law, Anna Nicole Smith.
“The Marshalls have never been a lightning rod, because they’ve never been in the public view financially,” said Richard Lieb, a research professor of bankruptcy law at St. John’s University School of Law in New York, who filed briefs to the Supreme Court with his students when the cases were being heard. “No one went after them to find out what their evil deeds were, if any.”
Marshall’s ability to stay out of the limelight stands in contrast to her father-in-law, J. Howard Marshall, who had been a Koch shareholder for more than two decades and created a spectacle with his 1994 marriage to Smith, then a 26-year-old Playboy model, whom he wed at age 89. Since then, the Marshall fortune has been in a near-constant state of turmoil.
More
"Liquidation sometimes is orderly, but more frequently
degenerates into panic as the realization spreads that there is only so much
money, not enough to enable everyone to sell out at the top".
Charles P. Kindleberger, Manias, Panics and Crashes.
The monthly
Coppock Indicators finished August:
DJIA: +76 Up. NASDAQ: +97 Up. SP500: +69 Up. All
three indicators have reversed from down to up.
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