Baltic Dry Index. 812 +06
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
“What does the NSA know about me, and when did it first know it?”
With apologies to Howard Baker.
For more on the rising scandal of “PRISMgate,”
scroll down to Crooks Corner. Astute LIR readers will note how PRISMgate rhymes with
Prisongate. Unless the US President and members of the misnamed “Justice”
Department have the dirt on the Congress and Judiciary, as in the good old days
of J. Edgar Hoover, and a willingness to use it, PRISMgate threatens to bring
down the Obama government and wipe-out Her Majesty’s excessively weak coalition
government in the UK as collateral damage. Stay long physical gold and silver, we are probably
about to repeat 1973-1974.
We open today with bad news from China. While
western media crowed about President Obama reading the riot act to China’s President Xi Jingping regarding cyber
spying, in reality all President Xi said was that he would do was to look into
it. Meanwhile Chinese media opened up on US hacking attempts against China.
While the great Pacific summit to fix relations between the aging Empire in the
west and the new rising Empire in the East for the early part of the 21st
century certainly did no harm, there was little on offer for the new rising
Empire, and I think the old aging Empire rather over hyped its achievements for
domestic political gain. With President Obama morphing daily into the new
tricky Dicky Nixon, President Xi probably can’t believe his good fortune.
Below why few take Chinese statistics at face
value, least of all the Chinese communists running the system.
"When it becomes serious, you have to lie"
Jean-Claude Juncker. Luxembourg Prime Minister and ex-president of the Euro Group of Finance Ministers. Confessed liar.
China Export Growth Plummets Amid Fake-Shipment Crackdown
By Bloomberg News - Jun 9, 2013 5:51 AM GMT
China’s trade, inflation
and lending data for May all trailed estimates, signaling weaker global and
domestic demand that will test the nation’s leaders’ resolve to forgo
short-term stimulus for slower, more-sustainable growth. Overseas sales rose 1 percent from a year earlier, down from 14.7 percent the previous month, the customs administration said yesterday, after a crackdown on fake trade invoices. Data today showed factory-gate prices fell for a 15th month, inflation was lower than all estimates in a Bloomberg News survey and new yuan loans declined
The data add pressure on President Xi
Jinping and Premier Li Keqiang to shore up
growth less than three months into their tenure, after first-quarter expansion
unexpectedly slowed. While the figures strengthen the case for easing monetary
policy or approving more spending, the leaders’ room is limited by rising home
prices, financial risks and overcapacity.
----“This shows the real state of the
Chinese export situation,” said Shen Jianguang, chief Asia economist at Mizuho
Securities Asia Ltd. in Hong Kong. The data give a “pretty depressed” picture,
with weak external demand and a yuan that has appreciated substantially against
a trade-weighted basket of currencies, said Shen, who previously worked at the European Central Bank.
More
China's economy stumbles in May, growth seen sliding in Q2
BEIJING |(Reuters) - Risks are rising that China's economic growth will slide further in the second quarter after weekend data showed unexpected weakness in May trade and domestic activity struggling to pick up.
Evidence has mounted in recent weeks that China's economic growth is fast losing momentum but Premier Li Keqiang tried to strike a reassuring note, saying the economy was generally stable and that growth was within a "relatively high and reasonable range".
China's economy grew at its slowest pace for 13 years in 2012 and so far this year economic data has surprised on the downside, bringing warnings from some analysts that the country could miss its growth target of 7.5 percent for this year.
"Growth remains unconvincing and the momentum seems to have lost pace in May," Louis Kuijs, an economist at RBS, said in a note.
More
Elsewhere far from the posturing in
California, the recently retired German Constitutional Court’s euro expert is
warning that a German Euro exit is a real possibility. While the ECB can just
ignore what the court eventually decides, the Bundesbank can’t. The paymaster
of the lesser dwarfs, might be unable to contribute to the rescue of Spain,
Italy and France. So even if Germany doesn’t actually have to quit, the euro
goes boom anyway. If the court reaches a political decision to give a blank
cheque to the ECB forcing BUBA to pay all of Europe’s bills, I suspect that
Germany’s newly formed anti euro party will soar at the polls in September’s
general election.
“Oh what a tangled mess we weave, when first we practise to deceive.”
Sir Walter Scott. 1808.
German court case could force euro exit, warns key judge
Crucial hearings on the eurozone’s bail-out policies at Germany’s top court this week could set in motion events that force Germany’s withdrawal from the euro, a leading judge has warned.
Udo di
Fabio, the constitutional court’s euro expert until last year, said the
explosive case on the legality of the European Monetary Union rescue machinery
could provoke a showdown between Germany and the European Central Bank (ECB)
and ultimately cause the collapse of monetary union.
“In so
far as the ECB is acting 'ultra vires’, and these violations are deemed
prolonged and serious, the court must decide whether Germany can remain a
member of monetary union on constitutional grounds,” he wrote in a report for
the German Foundation for Family Businesses.
“His
arguments are dynamite,” said Mats Persson from Open Europe, which is issuing
its own legal survey on the case on Monday.
Dr Di
Fabio wrote the court’s provisional ruling last year on the European Stability
Mechanism (ESM), the €500bn (£425bn) bail-out fund. His comments offer a rare
window into thinking on the eight-strong panel in Karlsruhe, loosely split 4:4
on European Union issues.
The court
is holding two days of hearings, though it may not issue a ruling for several
weeks. The key bone of contention is the ECB’s back-stop support for the Spanish
and Italian bond markets or Outright Monetary Transactions (OMT), the “game-changer” plan that
stopped the Spanish debt crisis spiralling out of control last July and vastly
reduced the risk of a euro break-up.
----Dr Di Fabio said the court, or Verfassungsgericht, does not have “procedural leverage” to force the ECB to change policy but it can issue a “declaratory” ultimatum. If the ECB carries on with bond purchases regardless, the court can and should then prohibit the Bundesbank from taking part.
The
Bundesbank’s Jens Weidmann needs no encouragement, say experts. He submitted a
report to the court in December attacking the ECB head Mario Draghi’s pledge on
debt as highly risky, a breach of both ECB independence and fundamental
principles. The ECB does not have a legal mandate to uphold the “current
composition of monetary union”, he wrote.
Dr Di
Fabio said it was hard to imagine that an “integration-friendly court” would
push the EMU “exit button”, but it can force a halt to bond purchases. This may
amount to the same thing, reviving the eurozone crisis instantly.
More
Friday’s US employment report was Goldilocks for
everyone. No sign of a really self-sustaining
economy requiring the FED to cut back on QE forever, just the seasonal uptick
that comes from the arrival of spring and summer. No sign of an employment
disaster at hand requiring even larger amounts of QE. The Fed’s final bubble has
a little further to grow, it seems, before whatever pin bursts it. Keep swapping dodgy euro notes and pictures
of dead white US former Presidents, for physical precious metals. The pressure
in the Fed’s pressure cooker continues to rise.
"The great merit of gold is precisely that it is scarce; that its quantity is limited by nature; that it is costly to discover, to mine, and to process; and that it cannot be created by political fiat or caprice."
Henry Hazlitt
At the Comex silver depositories Friday final figures were: Registered 42.03 Moz,
Eligible 122.62 Moz, Total 164.65 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, more on our lawless age. Just because you’re paranoid doesn’t
mean they’re not out to get you, they are! We know who you are and we know
where you live! When G. W. Obama says jump, the only thing for you to ask is
how high. Forget the constitution, judicial review, a right to privacy and a
right to silence. Rights and rule of law is so last century. Welcome to the 21st
century nightmare of George Orwell’s Big Brother and the Ministry of Truth.
“Trust
us. If you’re honest and vote for us, most of you have nothing to fear.” J. Edgar, Richard M., George W., and Barry
Hussein Obama, the four horsemen of the Apocalypse arrive.
“When a President does it that means it is not
illegal.”
President Richard M. Obama.
Edward Snowden has blown the whistle on this presidency. You have to wonder: Will Obama see out his full term?
US politics Last updated: June 9th, 2013"They could pay off the Triads," says Edward Snowden, the NSA whistleblower interviewed by the Guardian in his Hong Kong hideout. Meaning: the CIA could use a proxy to kill him for revealing that Barack Obama has presided over an unimaginable – to the ordinary citizen – expansion of the Federal government's powers of surveillance over anyone.
Libertarians and conspiracy theorists of both Left and Right will never forget this moment. Already we have Glenn Beck hailing Snowden on Twitter:
Courage finally. Real. Steady. Thoughtful. Transparent. Willing to accept the consequences. Inspire w/Malice toward none.#edwardsnowden
Snowden will be a Right-wing hero as well as a Left-libertarian one. Why? First, he thought carefully about what he should release, avoiding (he says) material that would harm innocent individuals. Second, he's formidably articulate. Quotes like the following are pure gold for opponents of Obama who've been accusing the President of allowing the Bush-era "surveillance state" to extend its tentacles even further:
NSA is focussed on getting intelligence wherever it can by any means possible… Increasingly we see that it's happening domestically. The NSA specifically targets the communications of everyone, it ingests them by default, it collects them in its system and it filters them and it analyses them and it measures them and its stores them for periods of time … While they may be intending to target someone associated with a foreign government or someone they suspect of terrorism, they're collecting your communications to do so. Any analyst at any time can target anyone…
I do not see how Obama can talk his way out of this one. Snowden is not Bradley Manning: he's not a disturbed disco bunny but a highly articulate network security specialist who has left behind a $200,000 salary and girlfriend in Hawaii for a life on the run. He's not a sleazy opportunist like Julian Assange, either. As he says: "I'm willing to sacrifice all of that because I can't in good conscience allow the US government to destroy privacy, internet freedom and basic liberties for people around the world with this massive surveillance machine they're secretly building."
It will
be very difficult for the Obama administration to portray Snowden as a traitor.
For a start, I don't think US public opinion will allow it. Any explanations it
offers will be drowned out by American citizens demanding to know: "So how
much do you know about me and my family? How can I find out? How long have you
been collecting this stuff? What are you going to do with it?"
Suddenly
the worse-than-Watergate rhetoric doesn't seem overblown. And I do wonder: can
a president who's presided over, and possibly encouraged, Chinese-style
surveillance of The Land of the Free honestly expect to serve out his full
term?
Edward Snowden comes forward as source of NSA leaks
By ,
-----In an interview Sunday, Snowden said he is willing to face the consequences of exposure.
“I’m not
going to hide,” Snowden told The Post from Hong Kong, where he has been
staying. “Allowing the U.S. government to intimidate its people with threats of
retaliation for revealing wrongdoing is contrary to the public interest.”
Asked
whether he believes that his disclosures will change anything, he said: “I
think they already have. Everyone everywhere now understands how bad things
have gotten — and they’re talking about it. They have the power to decide for
themselves whether they are willing to sacrifice their privacy to the
surveillance state.”
More
Code name ‘Verax’: Snowden, in exchanges with Post reporter, made clear he knew risks
By ,
He called
me BRASSBANNER, a code name in the double-barreled style of the National
Security Agency, where he worked in the signals intelligence directorate.
Verax was
the name he chose for himself, “truth teller” in Latin. I asked him early on,
without reply, whether he intended to hint at the alternative fates that lay
before him.
Two British dissenters had used the pseudonym. Clement Walker, a 17th-century detractor of Parliament, died in the brutal confines of the Tower of London. Two centuries later, social critic Henry Dunckley adopted “Verax” as his byline over weekly columns in the Manchester Examiner. He was showered with testimonials and an honorary degree.
Edward Joseph Snowden, 29, knew full well the risks he had undertaken and the awesome powers that would soon be arrayed to hunt for him. Pseudonyms were the least of his precautions as we corresponded from afar. Snowden was spilling some of the most sensitive secrets of a surveillance apparatus he had grown to detest. By late last month, he believed he was already “on the X” — exposure imminent.
“I understand that I will be made to suffer for my actions, and that the return of this information to the public marks my end,” he wrote in early May, before we had our first direct contact. He warned that even journalists who pursued his story were at risk until they published.
The U.S. intelligence community, he wrote, “will most certainly kill you if they think you are the single point of failure that could stop this disclosure and make them the sole owner of this information.”
I did not believe that literally, but I knew he had reason to fear.
A series of indirect contacts preceded our first direct exchange May 16. Snowden was not yet ready to tell me his name, but he said he was certain to be exposed — by his own hand or somebody else’s. Until then, he asked that I not quote him at length. He said semantic analysis, another of the NSA’s capabilities, would identify him by his patterns of language.
More
The illegal we do immediately. The unconstitutional takes a little
longer.
Richard Milhouse Obama,
with apologies to Henry Kissinger.
The monthly Coppock Indicators finished May:
DJIA: +142 Up. NASDAQ: +144 Up. SP500: +177 Up. The Fed’s
Final Bubble continues. But hurricanes and tornadoes appear. Getting out first
beats getting out last.
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