Baltic Dry Index. 1876 -75
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
"Those entrapped by the herd instinct are drowned in the deluges of history. But there are always the few who observe, reason, and take precautions, and thus escape the flood. For these few gold has been the asset of last resort."
Antony C. Sutton
Just how bad
are things in China? No one knows of course, because in a corrupt, largely command
economy, everyone reports back up the chain of command that they hit the
desired number. Still a slow motion debt train wreck now seems to be underway.
Just wait until the Fedster’s really start tapering, and all global interest
rates really rise. Of course the Fed may never taper and instead have to
reverse course and add to QE Forever. Even so, it seems unlikely to prevent a
massive train wreck in China.
"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
Crisis Risk Flagged by Haitong as Debt Snowballs: China Credit
Jan 8, 2014 2:29 AM GMT
China’s second-biggest
brokerage said record debt threatens to trigger a financial crisis as borrowing
costs jump to unprecedented highs despite a cooling economy. Liabilities at non-financial companies may rise to more than 150 percent of gross domestic product in 2014, raising default risks, according to Haitong Securities Co. The ratio of 139 percent at the end of 2012 was already the highest among the world’s 10 biggest economies, according to the most recent data. That compares with 108 percent in France, 103 percent in Japan and 78 percent in the U.S., figures from the Bank for International Settlements and the World Bank show.
“We are concerned that the debt snowball
may get bigger and bigger and turn into a crisis,” Li Ning, a
Shanghai-based bond analyst at Haitong Securities, said in an interview on Jan.
3. “Default probabilities from next year may rise because more and more Chinese
companies depend on new borrowings to repay old debt.”
More
China’s Credit Hole Seen Limiting 2014 Growth Prospects
Jan 8, 2014 1:10 AM GMT
China’s new credit probably
fell by a record in the second half amid a crackdown on speculative lending,
limiting prospects for economic expansion this year as policy makers focus on controlling
financial risks. The broadest measure, aggregate financing, was 7.1 trillion yuan ($1.2 trillion) based on published figures plus economists’ median estimate for December data due in coming days. That would be about 931 billion yuan less than in July-to-December 2012, the largest drop in figures going back to 2002.
More
As goes China so goes much of Asia. When China sneezes the rest of Asia gets flu.
Malaysia Default Risk at 2-Month High on China Slowdown Concern
Jan 8, 2014 4:23 AM GMT
The cost of insuring Malaysia’s sovereign debt climbed to a two-month high on
concern growth in China,
the nation’s biggest export market, is slowing. Five-year credit-default swaps rose two basis points, or 0.02 percentage point, to 116 in New York yesterday, according to data provider CMA. That’s the highest since Nov. 13. In Thailand, the contracts climbed to a four-month high and in the Philippines they reached a level not seen since October.
China’s broadest measure of new credit probably dropped by a record in the second half amid a crackdown on speculative lending, based on published figures and the median estimates of economists before data due in coming days. U.S. Treasury yields touched the highest level since July 2011 on Jan. 2 as the Federal Reserve pares stimulus that’s driven inflows to developing nations.
“The risks of emerging-market Asia are being priced in vis-a-vis U.S. Treasury returns,” said Vishnu Varathan, a senior economist at Mizuho Bank Ltd. in Singapore. “The desperation for seeking high yields is diminishing as U.S. yields increase. There may be a partial pricing in of China risks.”
More
Will the
Fedster’s use the big freeze to delay or alter the taper? It might not be the
worst idea around. While no one yet knows just how much of a hit from the
freeze the US economy is taking, the Florida citrus crop seems to have been
spared, the big freeze is a serious headwind to the US economy, not a positive.
In Chicago, even Anana the polar bear stayed inside.
US weather: all 50 states fall below freezing
All 50 of America’s states recorded temperatures below freezing at some point on Tuesday and even the polar bear at Chicago zoo spent most of the day indoors, as bitterly cold air gripped the country
Parts of the country which were not
victims of the “Polar vortex” that afflicted swathes of the US none the less
suffered abnormally chilly weather as US authorities declared it the coldest
Jan 7 on record.
The lowest temperature was
reported at Embarrass, Minnesota, a township of just over 600 people, where the
thermometer fell to -35F (-37C). Once the wind chill factor was taken into
account, the temperature felt as low as -45F (-43C).
On Hawaii the weather station on
Mauna Kea, the island’s highest mountain, recorded a temperature of 21F (-6C),
and temperatures plummeted at all levels in the southern states of the US
mainland.
“It’s not unprecedented, but it
is unusual,” a spokesman for the US National Weather Service said. “Normally
either Florida, Texas or Louisiana stays above freezing.”
In Chicago, the zoo’s polar bear,
Anana, which has less insulating fat than if it lived in the wild, was kept in
its heated indoor enclosure all day on Monday and only ventured outside briefly
yesterday as the thermometer fell to -16F (-27C).
At least 21 people are believed
to have died across the USA as a result of the cold blast which has crippled
much of the country. According to the latest official figures 187 million
people have been affected by the severe weather.
----However
according to US weather forecasters the worst is over, with temperatures
expected to climb slowly by the end of the week.
More
Chicago Colder Than South Pole as Frigid Air Clamps Down
Jan 7, 2014 11:59 PM GMT
Frigid air clamped down on much of the U.S., giving Chicago a morning
temperature lower than the South Pole and breaking records across the country amid
disruptions to road, rail and air transport. Chicago, which yesterday reached a new low for the date of minus 16 (minus 27 Celsius), hovered at 3 degrees at 4:51 p.m. local time, according to the National Weather Service. It was 9 degrees in New York, where temperatures earlier broke a record for Jan. 7 set in 1896, the agency said.
----“It’s amazing, the only part of the U.S. east of the Mississippi that’s above freezing is the southern two-thirds of Florida,” said Bruce Terry, a meteorologist with the center. “Today is the coldest day for a large chunk of the U.S.”
West of the Mississippi, the only places getting above freezing were the Southwest from Texas to California and then up the Pacific Coast to the Northwest, Terry said.
The worst cold apparently missed citrus regions of Florida, Dale Mohler, an AccuWeather meteorologist, said today. A surge in energy demand pushed power in Texas to more than $5,000 a megawatt-hour yesterday for the first time and caused disruptions to oil refineries and pipelines.
----PJM Interconnection LLC, the largest U.S. electric grid, said demand across its 13 states surged to a winter record of 138,600 megawatts early today and would reach 140,000 megawatts. Voltage on the grid was reduced by 5 percent today to cut use, while more than 61 million consumers from Washington to Chicago were asked to conserve.
Electric Reliability Council of Texas Inc., grid operator for most of the state, asked users to conserve power. Spot wholesale power on that grid reached $5,000 a megawatt-hour yesterday.
----Spot gas prices for today surged to a record for New York City of $90 per million British thermal units and reached 10-year highs on other parts of New England and the mid-Atlantic region in IntercontinentalExchange trading yesterday.
More
'You know it's cold when the air in your car's fuel tank starts to freeze'
A pastor in rural Ohio on how his town is coping with weather in the freezing polar vortex
10:05PM GMT 07 Jan 2014
Gregg
King is a pastor in Dunkirk, a town of 863 people in western Ohio
More
Up next a tale of two Europes. 2014, the year the euro died?
"With the exception only of the period of the gold standard, practically all governments of history have used their exclusive power to issue money to defraud and plunder the people."F. A. von Hayek
EU Puts Banking-Union Credibility on Line in Resolution Talks
Jan 8, 2014 12:01 AM GMT
The credibility of Europe’s
efforts to restore confidence in its financial system hangs in the balance as
lawmakers try to broker a deal on a bank-failure authority for the 18-nation
euro area.
As U.S. Treasury Secretary Jacob
J. Lew tours European Union capitals to push for tougher banking regulations,
negotiators in Brussels begin a sprint today to create a central agency for
saving or shuttering euro-zone banks before elections in May.
When EU finance ministers ended a
fractious debate and settled on a blueprint in December, European Central Bank
President Mario Draghi “strongly” welcomed the plan, though it diverged broadly
from the ECB’s position. The parliament’s stance is closer to the original
proposal made in July by Michel Barnier, the EU’s financial-services chief. Now
the two sides will try to find a compromise.
Barnier’s proposal for a strong
central authority backed by a single fund to cover resolution costs met with
broad approval from the parliament and the ECB, but faced an initial barrage of
German-led complaints from national governments. The final bill must be
approved by the parliament and member states to take effect.
“To complete the banking union, a
Single Resolution Mechanism must be finalized in the coming months,” said
Arlene McCarthy, a deputy head of the European Parliament’s Economic and
Monetary Affairs Committee. “Negotiations will be tough, as there are
fundamental issues on who decides if a bank will be resolved and who pays for
it that need to be agreed.”
More
Bundesbank May Gain ECB Ally as Latvian Joins Policy Team
Jan 8, 2014 12:01 AM GMT
The euro area’s newest entrant may give Bundesbank President Jens Weidmann
an ally in his battle against monetary policy that he considers too risky. Latvia’s Ilmars Rimsevics, 48, has joined the European Central Bank’s Governing Council after his country adopted the single currency on Jan. 1. His history of calling for budget cuts and structural reforms as the Baltic nation navigated a financial crisis echoes the views of Germany’s Weidmann, who has warned that easy money can derail fiscal efforts.
With rates in the euro area at a record low, unemployment near an all-time high and bank lending shrinking, ECB officials are debating how far to push monetary policy. A quarter of the 23-member council opposed the last rate cut in November and the addition of Rimsevics, who backed budget cuts and tax increases equivalent to 16 percent of the Latvian economy in 2008 and 2009, may make further easing harder to agree on.
More
UK car sales at highest since onset of financial crisis
SMMT says new car sales jumped 10.8% in 2013 – fuelled by
growing confidence, cheap finance deals and PPI payments
Tuesday 7 January 2014 11.58 GMT
UK car sales soared to their
highest level since 2007 last year, fuelled by growing consumer confidence,
cheap finance deals and payouts over PPI mis-selling.
However, the sales glut brought a
warning that secondhand car prices could slump within the next two years as the
market is flooded with vehicles. The number of new cars sold jumped nearly 11%
to 2.26m in 2013, the highest level since the onset of the financial crisis,
according to the figures from the Society of Motor Manufacturers and Traders
(SMMT). It was equivalent to 600 more cars sold a day in 2013 compared with
2012, and bucked the trend across much of Europe where sales have been falling.
UK sales rose by almost a quarter to 152,918 in December alone.
----The SMMT predicted a slowing of growth
in new car sales to 1% in 2014, as the rebound in demand from the lows during
the recession fades. A breakdown of the figures showed the strongest growth in
2013 due to private buyers, which rose nearly 20% as consumers felt more
confident amid economic growth and falling unemployment and were encouraged by
attractive promotions.
More
UK economy ‘dynamic’, according to BCC
By PRW Staff Posted 7 January
2014
The British Chambers of
Commerce’s (BCC) Quarterly Economic Survey (QES), released today, provides
further evidence that the UK economy is growing at a solid pace and could even
strengthen in the short term.
The survey, collated from
responses from nearly 8,000 businesses, shows improvements in most areas for
both the manufacturing and service sectors, and that all key balances are
stronger than their long-term historical averages, claimed the BCC.
“In the manufacturing sector,
five key balances are at all-time highs and exports in the services sector
continue to break new ground,” the organisation said in a statement. “But the
recovery must be maintained, as risks persist around access to finance for
firms looking to expand, and rectifying this is vital in moving our economy
from being merely good to being truly great.”
Commenting on the results, John
Longworth, director-general of the BCC, said: “It is a fantastic to start the
New Year with a very positive quarterly survey. Confidence is high and our
members are resolute in their determination to take the recovery from being good
to being truly great.
More
"If ever there was an area in which to do the exact opposite of that which government and the media urge you to do, that area is the purchasing of gold."
Robert Ringer
At the Comex
silver depositories Tuesday
final figures were: Registered 50.51 Moz, Eligible 125.77 Moz, Total 176.28 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, “The Barber of Britain, MBE”. Step forward
“U-turn Dave,” one term Prime Minister of the land once known as Great Britain.
Come back Gordon, all is almost forgiven.
To do this sickening dumbed down modern
“The Barber of Britain, MBE” article
full justice, I recommend that you play this from Boccherini for fitting
musical accompaniment as you read on about the decline and decline of 21st
century Britain. Gibraltarians take
note, you are all to soon likely to become Andalusian’s. Were the Isle of Wight to
declare independence tomorrow, under HMG’s downsized and soon to be part time
military, the Royal Navy would have a hard time blockading it, let alone
landing the UK’s last company of Royal Marines to retake it. We could of course
send in the Barber of Britain, MBE at the head of a contingent of high profile celebrity
customers, including Dave. That might make them surrender, or more likely throw
up. Fiat UK Pounds anyone. Falkland
Pounds? Scottish Pounds?
“But
I begin to fancy you don't like me. How strange! I thought, though everybody
hated and despised each other, they could not avoid loving me.”
Dave,
with apologies to Emily Bronte.
David Cameron’s hairdresser Lino Carbosiero awarded an MBE. Because he’s worth it.
Tuesday 07 January 2014
The man behind the all-important shift
of David Cameron’s parting from right to left has been awarded an MBE.
The prime minister faced fresh accusations of cronyism after it was revealed that his hairdresser, Lino Carbosiero, who was responsible for the change in style that saw the leader mocked in the Commons in 2010, appeared on the New Year Honours List last week.
The celebrity stylist – and former X Factor style director – was handed the prestigious honour for his "services to hairdressing".
"I was shocked and panicked," Carbosiero told the Evening Standard. "I didn’t expect the letter so I thought I hadn’t paid my tax."
He has been Cameron’s hairdresser for three years, allegedly bagging the Downing Street job under the orders of Cameron’s wife Samantha.
Carbosiero charges £90 a time for a men’s haircut and £150 for a woman’s. He counts Sir Paul McCartney, Madonna, Lily Allen and Zara Phillips among his other high-profile clients.
----Of course, this isn’t the first time a hairdresser has been honoured. The Queen gave her own stylist Ian Carmichael a royal nod in 2012, while the Duchess of Cornwall’s hairdresser Jo Hansford received an MBE in 2009.
But the news does come a week after a succession of senior Conservatives and supporters of the party were recognised in the New Year Honours list.
The roll call of awards for serving the nation included senior aides to the late Baroness Thatcher, long-serving MPs, Tory stalwarts in the Prime Minister’s Oxfordshire heartland, two Tory donors and a public relations chief who has holidayed with Mr Cameron.
It also featured the star of The Apprentice, Karren Brady, who is appointed CBE for services to entrepreneurship and encouraging women in business. She is being wooed by the Tories to become a MP in 2015 or to stand as Mayor of London the following year.
More
The truest characters of ignorance are
vanity and pride and arrogance.
Samuel Butler.
The monthly Coppock Indicators finished December and 2013.
DJIA: +204 Up. NASDAQ: +311 Up. SP500: +247 Up.
The new Fed bubble continues, but for how much longer?
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