Baltic Dry Index. 1602 +02
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
“It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."
J. K. Galbraith. The Great Crash: 1929.
We open today with America, while the world awaits
the next massive misallocation of capital under QE and ZIRP, the Twitter Inc. floatation.
In our modern dumbed down, heavily spied on world, we are all to now get rich
by “following” each other as twits. But be careful what you write, the
Twitterers’ “followers” aren’t the only ones reading the twits. Darker forces
know where you live, what you wrote, viewed, and think. That’s probably why
they are called twits.
Stay long fully paid up physical gold and silver
for the aftermath. The day after the end of QE forever and the death of the
Fedster’s final bubble. With China now the world’s leading crude oil importer,
how long before oil trades in Yuan? Scroll down for more on China.
Below, a US economy starting to stall?
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.
Economy in U.S. Probably Cooled in Third Quarter Before Shutdown
By Shobhana
Chandra - Nov 7, 2013 5:00 AM GMT
The economy slowed in the third quarter, indicating the U.S. expansion lost
momentum prior to the partial shutdown of the federal government, economists
project a report will show today. Gross domestic product, the value of all goods and services produced, rose at a 2 percent annualized rate after expanding at a 2.5 percent pace in the previous three months, according to the median forecast of 87 economists surveyed by Bloomberg. Consumer spending, the biggest part of the economy, was probably the weakest in more than two years.
More
Lew Said to Warn Banks of Tough Volcker Rule in Meetings
By Cheyenne Hopkins & Jesse Hamilton - Nov 7, 2013 5:01 AM GMT
Treasury Secretary Jacob J. Lew warned chief executive officers of top U.S.
banks in a private meeting last month that the final Volcker rule ban on
proprietary trading would be tougher than Wall Street
expects. At the meeting, details of which haven’t previously been disclosed, Lew told industry leaders that he has been encouraging regulators to make provisions of the Volcker rule more stringent, according to two people familiar with the meeting. The bank executives, members of the Financial Services Forum, left the meeting concerned the final rule would be more restrictive on their trading business than previously indicated, the people said.
This week regulators are putting the final touches on the rule, which could be released as soon as Dec. 10, according to two other people familiar with the process. That timeframe would put regulators on track to meet the administration’s self-imposed deadline to complete the rule by the end of the year.
More
Credit Jobs at 10-Month Low as Borrowing Slows: EcoPulse
By Anna-Louise Jackson & Anthony Feld - Nov 7, 2013 5:01 AM GMT
The
number of Americans who process credit transactions is slowing as lending to
governments, businesses and consumers declines.
The
credit-intermediation industry shed 7,700 workers -- including commercial
bankers, credit-card issuers and mortgage and loan brokers -- in September, the
biggest drop since June 2011, Labor Department figures show. The total fell to
about 2.6 million, the lowest since November 2012.
There could be additional job losses ahead, according to Dean Maki, chief U.S. economist in New York at Barclays Plc. That’s because the pace of lending activity “probably slowed down further in the third quarter,” he said.
Credit-market borrowing in all domestic nonfinancial sectors -- lending to households, companies and all levels of government -- grew by a seasonally-adjusted annual rate of almost $1.3 trillion in the second quarter, down from a $1.8 trillion increase in the prior quarter and the lowest rise since the three months ended Sept. 30, 2012, according to data in the Federal Reserve’s Flow of Funds Report.
More
One hundred big banks could go, warns McKinsey
A fifth of the largest global banks coud be broken up or bought within the next few years, according to McKinsey
One
hundred of the world’s largest banks could be dismantled or taken over by more
successful rivals within the next couple of years, according to a report by
McKinsey & Co.
About a
fifth of the world’s top 500 banks are at risk of becoming a takeover target
due to their underperformance and inability to adapt to market conditions in
the wake of the financial crisis.
In its
closely followed annual report on the banking industry, the firm’s consultants
said it only thought 10 banks would be able to make the transition from the
also-rans to join an emerging group of 90 global financial leaders.
McKinsey,
which is an adviser to many of the largest financial institutions, advocates a
“back-to-basic” strategy to avoid the “traps” that could see an array of large
banks consigned to the history books.
“Banks
that get caught in these traps are more likely to be among the 20pc of
institutions worldwide that, in our estimate, may become acquisition targets in
the next several years,” said the report.
Even
banks in the top tier will be forced to divest businesses and shrink to
succeed. McKinsey warned that businesses that have grown big on the back of
strong global growth may have to think about asset sales in future to remain
ahead of the pack
More
T. Rowe, Morgan Stanley funds sitting on whopper Twitter gains
BOSTON |(Reuters) - Mutual funds run by T. Rowe Price Group Inc and Morgan Stanley are poised to send one sweet tweet.
These early investors in Twitter Inc will reap exponential gains as the microblogging site goes public, while latecomers struggle for share allocations.
T. Rowe's New Horizons and Growth Stock funds may come out looking smartest, having scooped up millions of preferred shares for a pittance.
While
mutual funds put the vast majority of investors' assets into shares of publicly
traded companies, some actively managed funds jostle for additional upside by
trying to get a piece of promising companies years before they go public.
From its
inception in 2006 through the end of September, Twitter completed several
rounds of equity financing as a private company by issuing convertible
preferred stock that raised $759 million.
More
Our other focus today, ahead of the coming big
Communist Party of China Pow Wow in Beijing, is China. What to believe and what
not to believe? Is China about to get serious about an international reserve
currency role for the yuan. If so scratch off the EUSSR euro.
"It is the greenback which is unstable, and not the bullion."
Dr. Franz Pick.
China eyes adopting international law to spark life into trade zones
HONG KONG |(Reuters) - China is considering the use of international law in a big push to get free trade zones up and running to promote the use of the yuan in global trade, which could challenge Hong Kong longer term as the main offshore center for the currency.
Sources said Chinese leaders have been discussing the adoption of an international legal system in the free trade zones (FTZs) for the first time to help lure foreign companies, although views are varied.
"Authorities recognize that providing a robust legal framework and infrastructure will attract global companies," said a Hong Kong government official briefed on the FTZ discussions. "But agreement on this is far from uniform."
Bankers said such a move would go a long way to make FTZs more competitive with Hong Kong, which has been the only notable success among China's attempts to allow the closely managed yuan to trade more freely.
"The offshore yuan hub in Hong Kong is an experiment," said Marc Chandler, global head of foreign exchange strategy at Brown Brothers Harriman during a visit to Hong Kong.
"And the policy mindset is if the experiment is successful, bring it back to the mainland and if not, abandon it."
Traditionally, Chinese leaders have promoted Hong Kong as the main offshore market for yuan trading.
About 18 percent of China's global trade is now conducted in yuan, from just 1 percent in 2009, and much of it is routed through the territory.
Hong Kong's success has been underpinned by a strong rule of law and freedoms under the "one country, two systems" formula adopted when the territory was handed over to China by Britain in 1997.
A
closed-door Communist Party plenum from Saturday to Tuesday is expected to set
in motion efforts to kick start a number of FTZs around China.
The FTZs have been set up, but in many cases rules over how participating
companies can operate have been fuzzy, limiting their success.
More
China's Oct commodities imports to rise on year on better economy
SHANGHAI |(Reuters) - China's main commodities imports likely eased from record levels last month due to a week-long holiday in October, but shipments of crude oil, copper and iron ore are still expected to post strong annual growth as economic recovery gathers pace.
Import demand for crude oil, copper and soybeans is seen staying elevated through the rest of the year, as an invigorated manufacturing sector boosts consumption by refineries, smelters and crushers, traders and analysts said.
The world's top commodity buyer is showing signs of a stabilizing economy after growth had slowed for nine of the past 10 quarters. Two surveys this month showed manufacturing was on a stronger footing and expanding at its fastest rate in at least seven months.
Preliminary trade data is due out on Friday between
0200 and 0300 GMT.
More
Factbox: China's attempts to bridle record house prices
BEIJING |(Reuters) - House prices in China are scaling record highs, leading the government to enforce a patchwork of controls on the market for the fourth consecutive year to calm activity.
Home prices climbed at their fastest pace in three years in September, underlining concerns that housing is increasingly unaffordable for many Chinese.
But real estate is also a rare bright spot in the world's No. 2 economy, helping support growth, which is sagging this year towards a 23-year-low of 7.5 percent.
Below are measures taken by various cities this year:
BEIJING
* The city will supply 70,000 houses that are 30 percent cheaper than regular property for middle-income buyers.
* Speculators who bypass controls barring them from owning more than two homes will be stripped of their houses and banned from buying property in the city in the next five years.
* Developers who do not accept the government's "guidance" on prices and who do not block speculators from getting mortgages will be banned from selling property.
* Down payment for second homes raised to 70 percent from 60 percent, effective April 8, 2013.
* Beijing residents who are single cannot buy second homes, effective March 30, 2013.
* Sellers must pay 20 percent tax on capital gains, unless they own only one property and have had it for over five years.
* Developers who sell homes deemed to be too pricey will not be licensed for early sales - or houses put up for sale before their construction is finished - a key financing method used by firms.
More
"We are in a world of irredeemable paper money - a state of affairs unprecedented in history."
John Exter
At the Comex silver depositories Wednesday final figures were: Registered 44.22
Moz, Eligible 125.60 Moz, Total 169.82 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
No seriously bent central banksters today, nor
totally doubled over crooked politicians. Today it’s spy day. While the UK’s
top spooks face a grilling, someone somewhere is sure to be poking around in
the affairs of the grillers. The spooks may get grilled, but the grillers risk
getting burnt. Others today will be listening in on the deliberations of the
Frankfurt ECB and the London BOE. Yet more from America to China, will be
breaking and entering, listening and copying, and stealing every trade secret
going. Seen any drones lately? Lost any friends to the US run international Gulag
estate? Been tapped on the shoulder for
a chat with a civil servant from GCHQ? Welcome to more of our lawless age.
"We
have reason to believe you have committed an offence."
City of
London, parking ticket. 1960.
Three spy chiefs to be grilled by MPs
The heads of Britain’s three intelligence agencies will give evidence in public for the first time on Thursday.
In a
landmark hearing, the heads of MI5, MI6 and GCHQ will appear before MPs in an
open session to be questioned on their activities.
The
session follows the granting of wider powers to the parliamentary Intelligence
and Security Committee to hold the agencies to account.
The group
of MPs and peers can demand sensitive material be handed over and investigate
any operation they wish.
Committee
officials will also be able to go to the agencies to review and retrieve
documents rather than relying on them to decide what evidence is relevant to
any inquiry.
Sir
Malcolm Rifkind, chairman of the committee, said: “The perfectly legitimate
arguments that were made in the past about intelligence oversight have now been
dealt with. Intelligence oversight now has all the powers required and this
public hearing will be the first of many.”
----They are expected to launch a fresh attack on the Guardian newspaper and the GCHQ leaks it published from files stolen by Edward Snowden, the former CIA contractor.
They will
warn that the revelations have damaged defences against terrorists.
More
Google engineer accuses NSA and GCHQ of subverting 'judicial process'
Anti-hacking expert claims British spy
agency is 'even worse' than NSA for tapping private networks between Google's
centres
Wednesday 6 November 2013 14.29 GMT
A British engineer who works on anti-hacking systems at Google has furiously accused the UK and US spying agencies of "industrial scale subversion of the judicial process" by tapping the company's internal networks.
Mike Hearn, who says he worked for two years on the networks that replicate Google data between its different computing centres, says that "GCHQ [the British surveillance centre] turns out to be even worse than the NSA [the US National Security Agency]". He added that he joined an American colleague, Brandon Downey, "in issuing a giant fuck you to the people [at the NSA and GCHQ] who made these slides".
His complaint follows the revelation by the Washington Post of slides leaked by Edward Snowden which show that GCHQ tapped the private networks between Google's centres in order to monitor traffic.
Hearn, a senior engineer at Google since 2010, complains that "nobody at GCHQ or the NSA will ever stand before a judge and answer for this industrial-scale subversion of the judicial process".
The Washington Post slides show that GCHQ has been tapping into private optic fibre cables, which Google leases from Level 3 Communications to coordinate its data stores between Finland, Dublin and Belgium, in order to monitor traffic and extract data. Hearn says that one of the slides "shows a database recording a user login as part of this [anti-hacking] system" – itself prima facie evidence that the tapping occurred
More
China military hackers persist despite being outed by U.S.: report
WASHINGTON |(Reuters) - The disclosure early this year of a secretive Chinese military unit believed to be behind a series of hacking attacks has failed to halt the cyber intrusions, a U.S. computer security company and congressional advisory panel said on Wednesday.
A report by the cybersecurity company Mandiant in February identified the People's Liberation Army's Shanghai-based Unit 61398 as the most likely culprit in hacking attacks on a wide range of industries. China's Defense Ministry denied the accusations.
The U.S.-China Economic and Security Commission, a panel which advises the U.S. Congress on China policy, said Mandiant's revelations brought only a brief pause in cyber intrusions by that PLA unit.
A Mandiant spokeswoman told Reuters that within a few weeks of the February report, the hacking levels from China had returned to about the same levels though the group was using some different tools.
"From what we can tell, they are still stealing the same type of data from the same industries," Mandiant spokeswoman Susan Helmick said on Wednesday.
"The focus appears to be the same but the methods and malware, they had to shift," Helmick said.
A spokesman for the Chinese embassy in Washington on Wednesday repeated China's response to the initial Mandiant report.
More
Someone
must have been telling lies about Joseph K., for without having done anything
wrong he was arrested one fine morning.
Franz
Kafka. The Trial.
The monthly Coppock Indicators finished October:
DJIA:
+178 Up. NASDAQ: +238 Up. SP500: +217 Up. The Fed’s final bubble continues to
grow, until QE Forever isn’t forever.
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