Baltic Dry Index. 2047 +39
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
“No one in their right mind would even
consider playing Russian roulette with the full faith and credit of the
government of the most powerful economy in the world.”
Mohammed El-Erian. Pimco.
We have reached Friday
and the weekend. In America, the national government still remains partially
shut down, though for most this merely means that national parks and monuments
are closed, and today’s US employment figures will be delayed. In the markets,
few expect the shutdown to outlast the coming weekend. Of greater concern, the
coming brinkmanship over the coming war over raising the USA’s debt ceiling. By
Monday, according to the spin from the President’s party, Uncle Sam will be
just 10 days away from having to make some very bad choices. Pay America’s
creditors or pay America’s retirees. Pay America’s military or pay America’s disabled
and ill and those in poverty on welfare. You get the general idea. There are no good options. The rest of the
world for the most part, still expects sanity to break out belatedly in
Washington, and common sense to prevail and a political compromise to be
reached. But panic is rising among the central banksters and other Lords of the
Universe who must keep the Great Nixonian Error of fiat currency working.
Behind all the smoke
and mirrors, a fiat currency is backed by nothing other than people’s
willingness to use it, pretending all the while that it has “value.” That great
pretence will unravel with each passing day we get closer to President Obama’s
self-declared “red line” of October 17. Red lines and President Obama have an
unhappy association. From London it appears that only one dog in this fight can
win. The other dog must lose, and probably loses badly. Unfortunately at this
point in time, it’s impossible to tell which dog is likely to win, although the
favourite has to be the Presidents party. They hold all the patronage strings.
If this week’s show down in Italy is any guide, the President’s Democratic
Party ought to be able to turn enough Republican’s to get its way.
Nevertheless,
this whole unseemly process demonstrates why the dollar has little claim to be
the world’s leading reserve currency, nor why the world should continue to
operate on a shabby system of fiat currencies. When the next bust hits,
hopefully not later this month, the
whole fiat currency system crashes with it. In a 60 plus trillion global GDP,
there is simply not enough cash underpinning it, let alone to support over a
quadrillion in derivatives gambling contracts. Stay long fully paid up precious
metals held outside of the US and UK banking systems, and outside of America’s
scammy MF Globals. Zimbabwe here we come.
“Reader, suppose you were an idiot. And
suppose you were a member of Congress. But I repeat myself.”
Mark Twain.
Analysis: U.S. government shutdown fight could morph into debt limit superstorm
WASHINGTON |(Reuters) - With the U.S. government shutdown in its second day on Wednesday and no end in sight, a worrisome reality is sinking in on Capitol Hill: The standoff is merging with a much more complex fight in mid-October over raising the federal debt limit.
"We think the issues are converging," Republican Representative Paul Ryan, chairman of the House Budget Committee, told reporters on Wednesday.
Ryan, last year's Republican vice presidential candidate, sees the development as positive, forcing two deadlocked adversaries to come to the negotiating table in the face of a bigger threat than a partially shut-down government
But it could mean the shutdown will not end until the middle of October.
More significantly, the result could be a dangerous and unpredictable fiscal superstorm that may be harder to resolve than the shutdown alone or the 2011 debt limit struggle that sent financial markets plummeting and brought the United States to the brink of default.
The central problem is that congressional Republicans view the debt ceiling as their best chance to negotiate concessions from President Barack Obama, while at the same time, Obama says he will not negotiate around the debt ceiling, as he did in 2011.
That
alone is a recipe for stalemate.
The time
frame is equally daunting. The government's $16.7 trillion borrowing cap must
be raised by October 17.
Finally,
Republicans aim to bring new demands to negotiations that already have
deadlocked over Republican efforts to derail or curtail Obama's signature
healthcare law, known as Obamacare.
Beyond
Obamacare, Republicans have talked about seeking concessions on tax reform,
approval of the Canada-to-Texas Keystone XL oil pipeline, a reduction in
"sequester" spending cuts on the military along with a long wish list
of other Republican priorities.
More
“If we screw up, everybody gets screwed
up”
President Barack Obama.
Resolving debt ceiling 'mission-critical' for global economy, says IMF
IMF chief and US Treasury issue stern warnings over "serious" economic consequences of political brinkmanship over America's debt-ceiling.
America
risks plunging the global economy into chaos unless Congress stops its
political infighting and addresses the “mission-critical” task of raising the
debt ceiling, the International Monetary Fund chief has warned.
Washington
is due to hit its borrowing limit on October 17, at which point politicians
must raise the limit or face an unprecedented default on US sovereign debt.
Christine
Lagarde said failure to raise the world’s largest economy’s $16.7 trillion
(£10.3 trillion) ceiling would send shockwaves through the global financial
system.
“The
government shutdown is bad enough, but failure to raise the debt ceiling would
be far worse, and could very seriously damage not only the US economy, but the
entire global economy,” she said. “So it is 'mission-critical’ that this be
resolved as soon as possible.”
The US
Treasury has also warned Congress against a re-run of the budget wrangling
which has led to the first government shutdown in 17 years. A similar deadlock
over the debt ceiling, it said, could result in a recession “comparable to or
worse than the 2008 financial crisis”.
A default
would amount to a “self-inflicted wound” and could lead to credit markets
freezing, the value of the dollar plummeting and the country’s cost of
borrowing to skyrocket, the US Treasury warned.
Even the
prospect of a default could hurt economic recovery, said the Treasury, citing
the impact of the debt ceiling deadlock in 2011 which caused consumer and
business confidence to drop.
"a company for carrying out an undertaking of great advantage, but nobody to know what it is".
South Sea Bubble. 1720
Twitter valued at $10bn as it aims to raise $1bn in IPO
Twitter is seeking to raise up to $1bn at its initial public offering later this year, which is expected to value the company at north of $10bn despite the fact it is still considerably loss-making.
Its
fundraising target was revealed in the company’s pre-IPO “S-1” filing, which
was lodged in secret in September and disclosed to the public on Thursday
night. The social media business did not say where it will list, but it
confirmed it will use the ticker “TWTR”.
According
to the 164-page document, Twitter notched up revenues of $316m in 2012,
slightly ahead of analysts’ expectations, which had put the figure at around
$250m, but it made a loss of $80m.
The San
Francisco company lost an additional $69.3m in the first six months of 2013, as
it turned over $253m. Analysts expect revenues to hit $500m by the end of the
year and $1bn in 2014.
The
social network’s IPO, expected by the end of November, is the most hotly
anticipated technology flotation since Facebook’s disastrous market debut in
May 2012. That company placed at $38 a share but sank back on the first day of
trading and continued to fall to a low point of $17.73 last September. It only
recovered its losses last month.
Facebook’s
bumpy start has made many investors wary of technology stocks. Twitter’s flotation
is seen as the first real test of shareholders’ current appetite for the
sector.
Goldman’s Noto Nabs Twitter IPO Lead in Return From NFL
By Ari Levy & Serena Saitto - Oct 4, 2013 12:46 AM GMT
Noto, a dot-com era Internet analyst, is Goldman Sachs Group Inc. (GS)’s head banker on Twitter. The IPO would be the largest for a U.S. technology company led by Goldman, according to data compiled by Bloomberg. The microblogging service publicly released its IPO filing yesterday via the U.S. Securities and Exchange Commission, using a $1 billion placeholder amount.
Twitter is helping Goldman Sachs bounce back after the investment bank was trounced by Morgan Stanley for the prime spot on social-media deals from LinkedIn Corp. (LNKD) to Facebook Inc. (FB) Noto, who co-manages technology investment banking with George Lee, has helped drive new deals for New York-based Goldman Sachs since returning to his former employer from the NFL, where he was chief financial officer.
5 key risk factors from the Twitter S-1 filing
October 3, 2013, 6:38 PM
Here are five key risk factors in the S-1 filing from Twitter TWTR with the SEC Thursday.
More
“Call
it the Goldman Sachs test. If this is something Goldman would do to its
clients, don't do it."
Felix
Salmon.
At the Comex silver depositories Thursday final figures were: Registered 43.32
Moz, Eligible 123.42 Moz, Total 166.74 Moz.
Inventories are rising again, is the any silver left in the LBMA vaults
in London?
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Posted without need of comment from me, except to
say to Germany, don’t try this with Greece or Cyprus.
"When paper money systems begin to crack at the seams, the run to Poland could be explosive."
With apologies to Harry Browne and gold.
Germans Export Grandma to Poland as Costs, Care Converge
By Naomi Kresge - Sep 16, 2013 5:00 AM GMT
Sonja Miskulin
has forgotten her beloved cat, Pooki. She can’t remember whether she has
grandchildren and has no memory of her nine-hour journey one recent Sunday to
forever leave behind her home in Germany.
Suffering from dementia, the wheelchair-bound former translator celebrated her 94th birthday in a Polish nursing home last month. Her daughter sent her there in a bid for a better life and more affordable care.
Miskulin has joined the vanguard of a controversial movement: emigrant nursing home residents. The “Grandma export” trend has set hands wringing in Germany, where Munich’s leading newspaper denounced it as “gerontologic colonialism” and compared it to nations exporting their trash. Yet more families like Miskulin’s say it’s their best option to provide a dignified old age for elderly parents -- and save money -- amid a lack of affordable quality care at home. One in five Germans would now consider going abroad for a nursing home, according to a March survey by TNS Emnid, one of Germany’s biggest pollsters.
“I can only say, children, when your parents get older, send them to Poland,” said Miskulin’s 66-year-old daughter, Ilona von Haldenwang.
More
Swiss Retirees Traverse Pension-Fund Abyss by Dog Walking
By Carolyn Bandel & Corinne Gretler - Oct 3, 2013 11:01 PM GMT
Swiss retirees are soothing concerns over the country’s 42.4 billion-franc
($47 billion) pension-fund deficit by walking dogs, tending bars and giving
financial advice. The number of pensioners for hire at Zurich-based Rent a Rentner AG almost doubled to 2,245 this year, said Peter Hiltebrand, who founded the online booking agency in 2009. The retirees, who range from age 60 to 90, set their own fees, starting at a minimum of about 20 francs an hour.
----While Switzerland has one of the highest per capita incomes in the world, the number of people who work beyond retirement age jumped 43 percent over the past decade. The online platform, which translates as Rent a Pensioner, allows Swiss companies and private individuals to tap the expertise of retired yoga teachers, chauffeurs and bankers.
“It’s not just about walking dogs and working in the garden,” said Anita Haug, 64, who signed up with the agency after working for Citigroup Inc. in Zurich for 23 years, including eight years as a wealth manager. “There’s a big demand for business and finance, because the pensioners have a lot of know-how that young people lack.”
More
"As fewer and fewer people have confidence in paper as a store of value, the price of gold will continue to rise. The history of fiat money is little more than a register of monetary follies and inflations. Our present age merely affords another entry in this dismal register."
Hans F. Sennholz
Another weekend and all eyes are on
Washington. Does crash season start next week? In my part of the world, it’s
time again to start gathering in the wild sweet chestnuts, though the long cold
spring has produced a poor crop. Have a great weekend everyone.
“I was gratified to be able to answer
promptly, and I did. I said I didn’t know.”
Mark Twain.
The monthly Coppock Indicators finished September:
DJIA: +167 Up. NASDAQ: +213 Up. SP500: +203 Up. All
three are back positive again, thanks to continued Fed QE. High risk speculators will now use any stocks
sell-off to go long. After the last Fed meeting and QE U-turn, the Bernocchio
put is back on.
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