Baltic Dry Index. 1060 +53
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
"In economics, hope and faith coexist with great scientific
pretension."
J. K. Galbraith
With the terrible events in Egypt yesterday well
covered by mainstream media we will await today’s hopefully better
developments. But what happens in Egypt and the wider Middle East has the
potential to deliver a Black Swan to our fragile global economy.
Yesterday we made the case that Bernocchio’s cat
was alive and well, today we make the case that if not already dead, it’s
dying. Below a troubled Asia this morning, plus the smart money in London
already betting on interest rates rising. Would even more QE by the Bank of
England really force the smart money to bet the other way, or would it just be
another shot in our new currency wars?
Stay long physical gold and silver. The great disconnect in global stock
markets seems to be nearing its end. China and South Korea are unlikely to let
an unrepentant, rising militaristic
Japanese government, get a free ride for much longer.
"Japan was forced to go to war by American oil and other embargoes."
Hosei Norota, senior member of Japan's ruling Liberal Democratic Party (2001).
Japan visits to war shrine likely to anger Asian neighbors
TOKYO |(Reuters) - Japanese Prime Minister Shinzo Abe sent a ritual offering to a controversial shrine for war dead on Thursday - the anniversary of Japan's defeat in World War Two - but did not visit in person in an effort to avoid inflaming tensions with Asian neighbors.
However, at least two cabinet ministers publicly paid their respects at Yasukuni Shrine, seen as a symbol of Japan's past militarism, which is likely to anger South Korea and China and risks undermining tentative diplomatic overtures to Beijing.
"I asked my special aide ... to make the offering on my behalf with a feeling of gratitude and respect for those who fought and gave their precious lives for their country," Abe told reporters at the prime minister's office.
"As for when I might go to Yasukuni Shrine, or whether I will go or not, I will not say as this should not become a political or diplomatic issue," he said after his Liberal Democratic Party (LDP) aide conveyed the offering in the name of "Shinzo Abe, LDP leader."
Chinese state media reported the country's military would conduct live fire drills for four days from Thursday in the East China Sea, though not close to Japan. Some Japanese media speculated this was timed to coincide with the Yasukuni visits.
Visits to the shrine by top politicians have outraged Beijing and Seoul in the past because the shrine honors 14 Japanese wartime leaders convicted as war criminals by an Allied tribunal, along with war dead.
"Can you imagine what the world would think of Germany if they paid homage to Nazi boss Hitler?" retired Chinese Major General Luo Yuan, one of China's most outspoken military figures, wrote in the influential tabloid the Global Times.
More
Commentary: Irresponsible attitudes toward history jeopardize Japan's future |
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English.news.cn 2013-08-15
11:23:25
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Prime Minister Shinzo Abe himself shied away from the notorious shrine, but he decided Wednesday to offer a sacrifice. His nod to the ministers' visits and their recent provocative remarks signals that the current Japanese government has gone too far on the right-leaning road, raising fears among Japan's neighbors about a dangerous revival of its militarist past.
The Abe administration has made no secret that the pacifist clause of the Constitution, a crucial pillar of Japan's post-war political arrangements, is an impediment to his ambition of bolstering military power.
Japan has seen the rise of defense expenditure for the first time in a decade in the name of improving "self-defense" capabilities.
The Japanese government, despite unequivocal opposition from China, moved ahead last year with its plan to "purchase" some of the Diaoyu Islands, an integral part of Chinese territories, igniting a fierce maritime dispute with Beijing.
Japanese government officials, while claiming they are willing to have direct talks with their Chinese counterparts, continue to infuriate China with irresponsible attitudes toward history and provocative words, escalating tensions in the Asia-Pacific.
China is committed to using peaceful means and negotiations to settle maritime disagreements, but is also ready to protect its territorial rights and safeguard stability in the region.
The irresponsible words and acts of some Japanese right-leaning politicians have taken a heavy toll on the country's relations with its neighbors, seriously dented its credibility and tarnished the country's image.
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Two Japanese cabinet members visit Yasukuni Shrine
TOKYO, Aug. 15 (Yonhap) -- Two members of Japan's cabinet paid their respects Thursday at a Tokyo shrine seen as a symbol of the country's imperialistic past despite long-running protests from South Korea and China against such visits.Internal Affairs and Communications Minister Yoshitaka Shindo and Keiji Furuya, minister in charge of the issue of North Korea's abductions of Japanese nationals in the 1970s and '80s, visited the Yasukuni Shrine that honors Japan's war dead, and includes Class-A criminals.
Thursday was the anniversary of Japan's defeat in World War II.
Shindo later told reporters that he made the visit as an individual, not as a cabinet member.
South Korea, China and other Asian nations have long resented visits to the shrine because the act is considered to glorify Japan's imperialistic past.
Later in the day, about 90 Japanese lawmakers also paid homage at the shrine.
http://english.yonhapnews.co.kr/national/2013/08/15/78/0301000000AEN20130815000651315F.html
August 14, 2013, 9:25 a.m. ET
Japan Exports to China at 4-Year Low
TOKYO—Japan's exports to China in the first half of the year fell to their lowest level in four years, as slowing infrastructure investments added to the continuing diplomatic tensions between the two countries, a government affiliate said Wednesday.Data from the Japan External Trade Organization showed that the pace of year-over-year declines in Japanese exports to China accelerated to 16.7% for January-June from 14.8% in July-December, a period that includes September 2012 when anti-Japanese protests hit many Chinese cities after Japan's government nationalized a group of small islands claimed by both countries.
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JAPANESE WAR CRIMES ©
The Pacific War Historical Society records here Japan's long history of denial of its ghastly war crimes.
Link.
http://www.pacificwar.org.au/WarCrimeIntro.html
India Fighting Worst Crisis Since ’91 Seeks to Buoy Rupee
By Jeanette Rodrigues & Ye Xie - Aug 15, 2013 3:17 AM GMT
India increased efforts to
stem the rupee’s plunge and stop capital outflows that are pushing the economy
toward its biggest crisis in more than two decades. The Reserve Bank of India, whose Governor Duvvuri Subbarao steps down next month, cut the amount local companies can invest overseas without seeking approval to 100 percent of their net worth, from 400 percent, according to a statement late yesterday. Residents can remit $75,000 a year versus the previous $200,000 limit. Rupee forwards rose for the first time this week.
Policy
makers’ moves since July to tighten cash supply, restrict currency derivatives
and curb gold imports have failed to arrest the rupee’s slump to record lows as
they struggle to attract capital to fund a record current account deficit. The
rupee has weakened 28 percent in the past two years, the biggest tumble since
the government pledged gold reserves in exchange for loans from the International
Monetary Fund in 1991.
“I
don’t think this fixes India’s problem, at best it restricts about $5 billion
of flows annually, which doesn’t make a dent,” Bhanu Baweja,
the global head of emerging market cross asset strategy at UBS AG, said in a
phone interview from London yesterday.
----Central
bankers also exempted lenders from cash reserve rules for certain
foreign-currency deposits yesterday. Banks accepting non-rupee deposits after
Aug. 24 from Indians living abroad need no longer keep 4 percent in cash and
invest 23 percent in government-approved securities, the RBI said.
More
Mark Carney may have to relaunch QE to keep down interest rates
The Bank of England is expected to take further action to ensure interest rates remain low after last week’s pledge failed to sway the market.
Top economists said the Monetary Policy Committee (MPC) could relaunch quantitative easing (QE) within months if markets did not move into line with the “forward guidance” unveiled by Governor Mark Carney last week.The warning came after another rise in both sterling and government borrowing costs, and as traders brought forward their forecasts for a first rate rise to the third quarter of 2015 – roughly a year earlier than the Bank has signalled.
It followed publication of the minutes to this month’s MPC meeting, which revealed a split among the nine members over their landmark commitment to keep rates on hold at 0.5pc until unemployment drops to 7pc.
Martin Weale, an external member, backed the core proposal of “forward guidance” but wanted to strengthen one of three “knockouts” that can over-rule the unemployment target and force the committee to consider early rate rises
----Since the Bank unveiled its new unemployment threshold and signalled that it did not forsee any rate rises until the second half of 2016, markets have surprisingly ignored the guidance.
At the Comex silver depositories Wednesday final figures were: Registered 39.71
Moz, Eligible 125.16 Moz, Total 164.86 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today it’s the banksters again, City of London
branch. Today the miracle of JP Morgan’s “London Whale.” It’s not often one
gets to see a Whale sing and take a walk all at the same time. Below, an update
on Whales.
The good times too of high price almost always engender much
fraud. All people are most credulous when they are most happy; and when much
money has just been made, when some people are really making it, when most
people think they are making it, there is a happy opportunity for ingenious
mendacity. Almost everything will be believed for a little while, and long
before discovery the worst and most adroit deceivers are geographically or
legally beyond the reach of punishment.
Walter Bagehot. Lombard Street. 1873.
US charges two men with fraud in 'London Whale' scandal
Two former JPMorgan employees have been charged by US prosecutors with attempting to conceal losses and falsify records in criminal charges related to the bank’s $6.2bn (£4bn) trading loss last year.
Javier Martin-Artajo, 49, who oversaw the trading strategy at the bank’s London investment office, and Julien Grout, 35, one of his employees, have been accused of deliberately trying to hide hundreds of millions of dollars in losses on trades in the bank’s Synthetic Credit Portfolio (SCP) between March and May 2012.The men have been charged with four counts, including conspiracy to falsify books and records and making false filings to the Securities and Exchange Commission (SEC).
In a parallel lawsuit filed in Manhattan, the SEC said the defendants “engaged in a scheme to enhance SCP’s apparent performance and thereby curry favor with their supervisors and enhance their promotion prospects and bonuses.”
Bruno Iksil, who executed the trades and has been dubbed the “London Whale” because of the enormous positions he took, has been granted immunity from prosecution by authorities in return for his co-operation, the US government said yesterday.
The FBI in New York, the SEC and regulators in the UK began investigations last year into the activity surrounding the costly bets, details of which were flagged up in a report by the Wall Street bank last summer.
Chief executive Jamie Dimon has characterised the $6.2bn loss - which once called a in a "tempest in a teapot" - as “the stupidest and most-embarrassing situation I have ever been a part of”.
Lawyers for Mr Martin-Artajo declined to comment on the charges on Wednesday, but said that he “has co-operated with every internal and external inquiry which was required of him in the UK” and was confident that he would be cleared of any wrongdoing.
More
Exploding Oregon Whale
One of the queries Quakers are asked to consider, is: "Do
you maintain strict integrity in your business transactions and in your
relations with individuals and organizations? Are you personally scrupulous and
responsible in the use of money entrusted to you, and are you careful not to
defraud the public revenue?"
Probably why there a no Quakers on Wall Street or in the City of
London.
The monthly Coppock Indicators finished July:
DJIA: +164 Up. NASDAQ: +167 Up. SP500: +195 Up. The
Fed’s final bubble still inflates.
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