Wednesday 7 November 2012

Blue Wins.



Baltic Dry Index. 947  -24

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

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

Thankfully Americans made up their minds to vote for a decision on the day. Americans, and the rest of the world will thankfully be spared weeks of court challenges questioning the result. American voters seem to have voted for more of the same. The Democrats get the spoils of the presidency and the Senate, as before. The Republicans get the spoils of the House of Congress and a tax veto. Without a little goodwill, four more years of animosity and campaigning probably lie ahead. For the rest of the world, a sigh of relief. Better the devil we know, of sorts. We will not now get a new trade war with China starting in January. President Putin will not start to be slapped around, early next year.

That the incumbent President won, is no surprise. The surprise lies in the weakness of the win. As at the time of writing, President Obama has won by about a half of one percent, or by about half a million votes out of the almost 105 million cast. The danger is that two Americas have emerged. Two Americas that seem to largely loathe each other. In many of the “red” states, the President trailed in 60:40. In theory none of this should matter. America only gets one president at a time. One government at a time. In practise it’s often a different matter. History has too many examples of a house divided ending badly. Still with four more years of President Obama, it likely means four more years of “Helicopter” Ben’s QE forever targeting stocks.  For more years to get to change America’s Supreme Court.

"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."

Antony C. Sutton

November 6, 2012, 4:16 a.m. ET

Japan Data Points to Economy Near Recession

TOKYO—An index of data most reflective of the current state of Japan's economy fell sharply in September, pointing to the nation being on the verge of a recession amid falling exports and shrinking industrial output.
The coincident composite index, which consists of 11 key indicators, including industrial output and retail sales, dropped 2.3 points on month to 91.2, the Cabinet Office said Tuesday. Excluding March 2011, September's fall was the biggest since February 2009 and marked the sixth straight month of declines.
More

Eurozone combined output falls at fastest rate since 2009

The downturn in Europe deepened as the combined output in manufacturing and services fell at the sharpest pace since July 2009, according to official data.

By Rebecca Clancy 9:37AM GMT 06 Nov 2012
The downturn spread to the core economies of the 17-nation bloc, with output falling at both manufacturers and service providers in all of the big-four economies.

Ireland, which was the second country to receive a bailout, recorded the only positive performance, where faster rates of expansion in manufacturing and services took combined growth to a 20-month peak.

The Markit eurozone PMI Composite Output Index fell to 45.7 in October, down from 46.1 in September and the earlier flash estimate of 45.8. Overall activity has now fallen for nine straight months.

Manufacturing production fell for the eighth month running, as companies experienced reduced inflows of new orders from domestic clients and lower intra- and extra-eurozone trade.

Meanwhile, service sector activity meanwhile fell at the sharpest pace since July 2009.
Steep contractions were signalled for Spain, France and Italy in October, although the rates of decline eased slightly in each of these nations compared with one month earlier.

More

http://www.telegraph.co.uk/finance/9657745/Eurozone-combined-output-falls-at-fastest-rate-since-2009.html

Debt crisis: German economic data is a 'catastrophe', say economists

German factory orders recorded their biggest drop for a year according to figures that lead a raft of economic data from Spain, France and Italy, that underscored the advancing debt crisis.

The German finance ministry said factory orders were down 3.3pc in September from the month before shocking economists who had forecast a 0.4pc drop, according to Bloomberg poll.

Taken with figures showing German business confidence has fallen to the lowest in two-and-a-half years, the data was described as “a catastrophe and very bad news” by Thomas Harjes, European economist at Barclays in Frankfurt. “We have a huge problem in the rest of the euro area that now seems to be reaching Germany and its labour market,” he said. “For the coming quarters, the economic outlook is quite gloomy.”
Fresh data from Markit Economics showed that the eurozone’s combined output of the manufacturing and services sector fell at the fastest pace since June 2009. The composite PMI for the 17 member states fell to 45.7 in October, down from 46.1 in September. It was the nineth consecutive monthly fall.

Politicians continued to argue over the rescue mechanisms. Germany’s “wiseman” panel of economic advisers said the European Central Bank’s radical bond buying programme - the prospect of which has underpinned the markets since the summer - should only be used in an emergency and should not be relied upon as a permanent method for economic stabilisation.

Spain is braced for the European Commission to axe its forecast growth for the country after El Pais obtained a draft of the predictions. According to the Spanish newspaper, the EC, which is due to publish figures tomorrow has changed its forecast for 2013 GDP from 0.5pc to 1.5pc.

Sharp fall in industrial output, denting recovery hopes

British industrial output fell more than expected in September, data showed on Tuesday, raising fears that the economy will contract in the fourth quarter.

Manufacturing output rose by 0.1pc in September on the month after a downwardly revised drop of 1.2pc in August, the Office for National Statistics said. Economists had predicted a monthly 0.3pc rise.

The wider reading of industrial output, which includes energy production and mining, fell by 1.7pc in September after a 0.5pc drop in August.

Excluding a decline in June that was affected by an extra public holiday, the monthly reading was the lowest since August 2009 and below forecasts for a 0.6pc drop on the month.

Samuel Tombs at Capital Economics said the industrial production figures suggest that "the economic recovery is quickly losing momentum again".

Although the figures were not weak enough on their own to prompt a downward revision to the preliminary estimate that the economy grew 1pc in the third quarter, Mr Tombs believed that weal data points to further falls in output ahead.

While America comes to terms with next year’s political line-up, we end today with Europe’s ever more crooked European Union. Despite 18 years of not being able to sign off on the EU’s accounts, the European Court of Auditors once again yesterday found the EU’s accounts in disarray. While the Greeks, on yet another general strike, brace for a new round of austerity from their Parliament, in Brussels it’s the life of Riley for Eurorats living high on the hog.

"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

Audit 'seriously undermines credibility' of EU spending

The British government has warned that the latest audit of Brussels spending "seriously undermines the credibility of the EU's financial management".

British opposition to Brussels budget increases hardened on Tuesday after the EU's auditor failed to give a clean bill of health to £89 billion of spending "affected by material error".

The European Court of Auditors reported on Tuesday that controls over 86 per cent of the EU budget last year were only "partially effective", a conclusion that has further polarised the battle over European Commission demands for a sharp rise in spending.

Vitor Caldeira, the ECA's chairman, said that auditors had "found too many cases of EU money not hitting the target or being used sub-optimally" at a time when national public spending was being cut and the eurozone was imposing austerity targets.

"Times are hard. With Europe's public finances under severe pressure, there remains scope to spend EU money more efficiently and in a better targeted manner," he said. "EU financial management is not yet up to standard."

Despite 18 years of critical reports by the auditors, the Commission and European Parliament have defied calls for austerity measures at the EU level by demanding an 11 per cent increase to long-term Brussels expenditure from 2014 to 2020.

----Marta Andreasen, the commission's former chief accountant and now a Ukip MEP, said: "This is now the 18th year in a row that the ECA has refused to give the EU Budget a clean bill of health. Worse still the 'error rate', shorthand for unnacounted money, is on the rise."

Kersti Kaljulaid, an Estonian member of the ECA, also highlighted concerns over the increased frequency rate for "material error" in audited EU projects which rose by eight per cent in 2011, from 36 to 44 per cent.
More

At the Comex silver depositories Tuesday final figures were: Registered 36.26 Moz, Eligible 105.75 Moz, Total 142.01 Moz.  


Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over. 

Today, Club Med again, where taxes are for little people, laws opt in opt out, with any bills to be sent to Berlin.

"We don't pay taxes. Only the little people pay taxes."

Leona Helmsley.

Italian police seize castle in €65m tax probe

Italian police have seized assets worth €65m (£51.9m) in a tax probe involving the €5.3bn sale of fashion houses Hugo Boss and Valentino in 2007.

By Telegraph staff and agencies 8:42AM GMT 06 Nov 2012
Italy's tax police said on Monday they had confiscated real estate, including a 15th century castle, land and corporate holdings of 13 people "linked to one of Italy's most important families in the fashion and textile sector".

A person familiar with the investigation told Reuters the 13 people in question were linked to the Marzotto group, and included members of the Marzotto family.

Marzotto sold Valentino Fashion Group - then including both the Valentino label and Hugo Boss - to private finance group Permira in 2007.

The assets, including apartments in Milan and Rome, a 25-room villa in Alpine resort Cortina d’Ampezzo and land, were taken preventively to cover €65m in taxes the 13 people are suspecting of having dodged when they booked a €200m capital gain from selling Valentino, reports the Financial Times.

The Marzotto family members avoided Italian tax obligations by using a Luxembourg-based holding company for the Valentino sale.

Those under investigation are suspected of not having filed tax returns.

A spokesperson for the Marzotto Group declined to comment, saying the news did not involve the company or any of its units.

The Italian government has set fighting chronic tax evasion as one of its priorities as it seeks to come to grips with the country's towering debt crisis and find resources to fund growth.

Lawyers representing the Marzotto family said the decision taken by Milan prosecutors ordering the seizure was "totally groundless".

The lawyers said bank documents showed capital gains from the operation had been declared and taxed.
"I acknowledge the seizure measures. I think it right only to point out that I did not have any operative position in the company in which I was minority partner," Matteo Marzotto, a board member of the textile family group, said in a statement.

The seized castle, Villa Trissino Marzotto, is near the town of Vicenza and has been in the Marzotto family for 60 years. With more than 50 rooms, it was expanded in the 18th century and has on its grounds two Italian-style geometrical gardens, a small forest, a road lined with lemon trees and more than 100 statues, reports the Financial Times.
More

Date set for Dolce & Gabbana's tax evasion trial

Designers Domenico Dolce and Stefano Gabbana are to stand trial for tax evasion totalling €416 million.
30 October 2012
The design duo will appear in an Italian court on December 3 accused of evading €416 million of tax in relation to the sale of the Dolce & Gabbana and D&G brands to the designers' Luxembourg-based holding company Gado Srl. The Italian police consider Gado Srl to be a legal body set up to enable the pair to avoid the country's high corporate taxes.

The Guardia di Finanza, an Italian police force under the authority of the national minister of economy and finance, first brought the charges against the pair and five of their business associates in 2007, however, in April 2011 they were dismissed by a lower court, which deemed there was no foundation for a trial. The Italian Supreme Court overturned that decision last November, saying that "tax avoidance, or tax mitigation, on an earnings declaration is a criminal offence under the law," reports WWD. Previously, tax avoidance was not considered a criminal offence.

Although neither Dolce & Gabbana have commented on the trial date, both have previously denied any wrongdoing and have claimed they have a clear conscience.

If convicted, the designers and their co-accused business associates could face up to three years in prison, or a fine of up to €1 million.
Link
http://fashion.telegraph.co.uk/article/TMG9642607/Date-set-for-Dolce-and-Gabbanas-tax-evasion-trial.html

A person doesn't know how much he has to be thankful for until he has to pay taxes on it. 

Anon.

The monthly Coppock Indicators finished October:
DJIA: +92 Up. NASDAQ: +99 Up. SP500: +102 Up.

No comments:

Post a Comment