Baltic Dry Index. 766 -18
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
"The tragic lesson of guilty men walking free in this
country has not been lost on the criminal community.”
President Richard M. Nixon.
Ever wonder how the world’s biggest retailer
got so big? According to the New York Times, the simple answer is bribery. Not
content with putting entire towns out of business in the land between the
shinning seas, south of the border in Mexico, with complete contempt for the
safety of its potential Mexican customers and workers, “Walmex
(WALMEXV) had used bribes to skirt regulations on unsafe construction,”
according to the NY Times. Who knew that Walmart is to retailing what UBS is to
international banking.
Somehow,
I suspect, the “grab it and run” decades of the nineties and noughties, are
over. After the bankster and vampire squid crash of 2007-2008, I sense a public
on both sides of the Atlantic turning more Puritanical and less forgiving of
buccaneering capitalism. 2013 will not be like 2003 which was like 1993, at
least when it comes to cheating, and playing fast and loose with complying with
the law. The world’s biggest retailer just might be headed for the world’s
biggest fine, and that’s assuming no one got injured building or shopping in an
unsafely constructed Mexican store. They may only be Mexicans to Walmart’s money
grubbing elite, but what does that do to America’s image in the rest of the
world?
"What do I care about the law ? Hain't I got the
power."
Cornelius Vanderbilt, 1794-1877.
Wal-Mart Probes Mexico License as NYT Reports Bribery
By Frank Longid - Dec 18, 2012 6:01 AM GMT
Wal-Mart Stores Inc. (WMT), the world’s biggest retailer, said it’s
investigating how it got a license for astore in Mexico as the New York Times reported its local unit bribed an official to change a zoning map.
Wal-Mart de Mexico SAB gave $52,000 to an official to redraw a 2003 zoning map that would have prohibited commercial development on a field less than a mile from the pyramids of Teotihuacan, according to the report. A former lawyer of the company known as Walmex cited the incident as he told Wal-Mart executives of how the unit used bribery, the newspaper reported.
“The allegations contained in the New York Times article surrounding events in 2003-2004 involving the permitting and licensing process for a Walmart de Mexico store in Teotihuacan, Mexico, have been part of the company’s ongoing investigation of potential violations of the U.S. Foreign Corrupt Practices Act we began more than a year ago,” Wal-Mart said in a statement.
----Wal-Mart last month said it was investigating possible FCPA violations in Brazil, India and China, in addition to its bribery probe in Mexico. The inquiries come as growth for Wal- Mart’s international sales slowed to 2.4 percent in the three months ended October, the slowest quarterly pace in three years, according to data compiled by Bloomberg.
Wal-Mart shut its investigation of the former Walmex lawyer’s account of bribery in 2006 even as the company’s investigators found evidence to support his allegations, the New York Times reported.
----Walmex (WALMEXV) had used bribes to skirt regulations on unsafe construction, the New York Times said, citing its investigation, which it said used confidential Wal-Mart documents.
The newspaper reported 19 store sites in Mexico were targets of Walmex’s bribes. Eight bribes totaling $341,000 were paid in relation to the building of a Sam’s Club in Mexico City without a construction license, environmental permit or urban- impact assessment, the New York Times said
More
http://www.bloomberg.com/news/2012-12-18/wal-mart-probes-mexico-license-process-as-nyt-reports-bribery.html
Up next, another red flag from China. China may be rebounding somewhat due to all the state sponsored infrastructure projects, but 2013 looks to be a difficult year nevertheless. If the euro breaks up in 2013, China’s exports to Europe will fall off a cliff, to use the American technical term. Stay long precious metals. H1 13 might bring on the next Lehman.
China's FDI inflow fall quickens in November
BEIJING,
Dec. 18 (Xinhua) -- November saw foreign direct investment (FDI) into China
fell for the 10th time in 11 months, as labor costs rose and an economic
slowdown dragged growth down for seven quarters in a row.
The
country's FDI inflow decreased 5.4 percent in November from a year earlier, and
the pace of drop accelerated from 0.24 percent in October, according to data
released by the Ministry of Commerce on Tuesday. The country's FDI inflow has
been declining since June.
In the
first 11 months of 2012, China attracted 100.02 billion U.S. dollars in FDI,
down 3.6 percent year on year, ministry spokesman Shen Danyang said at a press
conference.
Morehttp://news.xinhuanet.com/english/china/2012-12/18/c_132047767.htm
We end for today with the madhouse aka Europe. As Europe’s ex. UK auto sales collapse, and the continent is glutted with excess auto factories, Renault is about to build a new EU subsidised auto plant in Algeria. Below Europe as the euro heads towards breakup.
Renault to sign Algeria factory deal on Wednesday
PARIS |(Reuters) - French carmaker Renault (RENA.PA) will sign on Wednesday an agreement to build its first factory in Algeria, a spokeswoman told Reuters, confirming a report in daily newspaper Le Figaro.
The agreement will coincide with a visit to the country by French President Francois Hollande and will be signed by the group's regional manager, Jean-Christophe Kugler, and Algeria's industry minister, the spokeswoman added.
Le Figaro said in a preview of its Tuesday edition that Algeria would own 51 percent of the factory, with Renault holding the rest.
Renault had said last week its framework deal with Algeria was making progress but was yet to be finalized, following a memorandum concluded in May.
The agreement provides for construction of a plant to serve the local market, which expanded 46.5 percent in the first half to a total of 225,000 vehicles.
Hollande's visit to the North African country is also likely to raise a potential Algerian investment in struggling French automaker PSA Peugeot Citroen (PEUP.PA), a diplomatic source said last week, confirming a report on La Tribune's website.
More
http://www.reuters.com/article/2012/12/18/us-renault-factory-algeria-idUSBRE8BH08V20121218
French bear brunt of Europe's deepening auto slump
PARIS/BERLIN |(Reuters) - France's PSA Peugeot Citroen (PEUP.PA) and Renault (RENA.PA) led a 10 percent decline in European car sales in November, the market's first double-digit contraction in more than two years as economic gloom spread east and north.
The French suffered most - closely followed by General Motors (GM.N) and Fiat (FIA.MI) - as demand weakened sharply at home, in Germany and in eastern Europe, according to data published on Friday by the Association of European Carmakers.
Total European registrations fell to 965,918 cars for the month and 11.69 million for January-November, down 7.2 percent on the same period last year.
"European end market weakness is showing no signs of abating," London-based Credit Suisse analyst David Arnold wrote in a note published on Friday.
With December a seasonally weak sales month, Europe appears on course to record a similar drop for the year as a whole, to about 12.2 million total sales - its lowest in close to two decades. Most commentators now expect 2013 volumes to decline further, according to Arnold.
---- Renault's November registrations plunged 27 percent as the spreading economic weakness hurt sales of its no-frills Dacia brand, which until recently had resisted the worst of the slump.
More
http://www.reuters.com/article/2012/12/14/us-autos-europe-idUSBRE8BD0AF20121214
Tax evasion costs Greece 5 pct of GDP : EU tax chief
ATHENS |(Reuters) - Greece could generate budget revenues amounting to 5 percent of national output annually if it reforms tax collection and clamps down on tax cheats, the European Union's tax chief told a Greek newspaper.
Athens plans reforms next year to combat rampant tax evasion as it struggles to shore up public finances and achieve a primary budget surplus, both necessary to continue receiving bailout aid from international lenders.
---- Experts estimate that a shadow economy lying outside Greece's tax system amounted to more than a quarter of annual output in 2011, the highest level in the European Union.
It is common in the country for small business owners to under-report sales and pay lower value-added tax. The self-employed such as plumbers and electricians often get paid in cash, avoiding receipts.
More
http://www.reuters.com/article/2012/12/15/us-greece-taxation-idUSBRE8BE0C320121215
"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
At the Comex silver depositories Monday final figures were: Registered 42.34
Moz, Eligible 105.16 Moz, Total 147.51 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, more
on the failed Great Leaders’ EU summit last week. Finally Germany’s media
has woken up to the reality of the failing euro. She came, she saw, they
conquered. Thanks to the so called Eurozone agreement last week, Germany
unintentionally signed up to rescue all the rest of Europe. They can’t of
course and they know it. So this week Germany is frantically back tracking.
Welcome to Europe 2012. Stay long physical precious metals. The odds are high
that the euro as we know it dies in 2013.
Hans F. Sennholz
The Road to Shared Liability
Hidden Risks Plague Euro-Zone Bank Oversight Plan
By
Michael Sauga 2/17/2012
German Chancellor Angela
Merkel was full of praise for the euro-zone bank oversight plan passed last
week at the EU summit in Brussels. But the deal is not nearly as watertight as
she claimed. It lacks a legal foundation and could lead to a conflict of
interest at the highest levels of the European Central Bank.
Angela Merkel received recognition from the highest
possible level -- herself. The most recent resolutions made by the European
Union in its ongoing effort to save the common currency, she said last
Thursday, "can't be spoken of highly enough." Her administration had
been able to "push through Germany's core demands," she said.
Self praise, of course, is often inaccurate. But in this
case, the gap between fiction and reality is particularly wide. The agreement
reached by European leaders and their finance ministers during last week's
summits in Brussels could ultimately destroy Merkel's reputation as a
level-headed and firm savior of the common currency.
Her strategy in the crisis has long been praised for being one focused on a series of systematic small steps.
The results of last week's negotiations, however, can best be described as large steps backwards.
Merkel has tirelessly called for EU leaders to push forward with the political integration of Europe. But at the most recent EU summit, she personally ensured that plans to that effect, created by European Council President Herman Van Rompuy, didn't even make it onto the agenda. At the same time, German Foreign Minister Wolfgang Schäuble voted in favor of a new banking supervisory agency under the authority of the European Central Bank.
It is a plan that Germany's own central bankers view with concern. Lawyers at the Bundesbank object that the responsibilities of the new super-agency remain nebulous. The project has no "lasting, sustainable legal foundation," they say.
The German Vision
No longer is "more Europe" the focus of EU efforts. Instead, German taxpayers could be made liable for billions in risk taken on by large European financial institutions. There is little left of Merkel's motto calling for "increased liability only in the case of increased integration."
Merkel's administration had sought to push through its own vision of a banking union. To prevent a situation whereby struggling lenders in Spain or Ireland could easily access German tax revenues, large countries such as Germany were to have a greater role in the future banking watchdog. Schäuble also wanted to see the new agency strictly separated from the ECB Governing Council. He wanted to ensure that, in propping up ailing banks, the ECB didn't succumb to a conflict of interest with its true mission -- that of maintaining price stability. Schäuble demanded nothing less than a "Great Wall of China." No Governing Council member, he said, should be involved in the supervisory agency and that agency must be the final authority.
That is not what emerged from last week's summits, though. According to the agreement, the new oversight agency must submit all of its important decisions for authorization. In the case of conflicts, the agency must also submit to the decision of a mediation committee -- a provision which, according to German central bankers, is not sufficiently grounded in European law.
Could a situation arise in which the ECB Governing Council has the final word over the oversight agency's work, then? German central bank lawyers say that it can't be ruled out. And that would represent a significant failure for Schäuble and his negotiating team.
----First and foremost, however, Merkel was unsuccessful in ensuring that larger euro-zone members have more influence in the oversight agency. As has been the case thus far in the ECB, a vote from Malta counts just as much as a vote from Germany. It is a situation that makes it possible for expensive bailout packages for Irish or Spanish banks to be pushed through despite German opposition.
More
"All of the government's monetary, economic and political power, as well as its extensive propaganda machinery, will be enlisted in a constant battle to drive down the price of gold - but in the absence of any fundamental change in the nation's monetary, fiscal, and economic direction, simply regard any major retreat in the price of gold as an unexpected buying opportunity."
Irwin A. Schiff
The monthly
Coppock Indicators finished November:
DJIA: +103 Up. NASDAQ: +123 Up. SP500: +125 Up.
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