Baltic Dry Index. 1002 +20
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
“There are some bored foreigners, with full stomachs, who have nothing
better to do than point fingers at us [China]. First, China doesn’t export
revolution; second, China doesn’t export hunger and poverty; third, China
doesn’t come and cause you headaches, what more is there to be said?”
President Xi Jinping
Did black
swans just arrive yesterday with no one but me noticing? Up first the day’s “good”
news from Asia. Japan’s economy boomed in the first quarter, as the Japanese
wisely rushed to buy anything they needed ahead of April’s massive sales tax
increase. Pulling forward sales from the future is as old as America’s auto
industry, and usually ends with the same sort of unintended result. In other
Japan news, Japan’s stepping up preparations for World War Two, the epilogue.
“When you develop your opinions on the basis of weak evidence,
you will have difficulty interpreting subsequent information that contradicts
these opinions, even if this new information is obviously more accurate.”
Nassim Taleb. The Black Swan.
Japan’s Economy Accelerated in First Quarter
May 15, 2014 4:29 AM GMT
Japan’s economy grew at the
fastest pace since 2011 in the first quarter as companies stepped up investment
and consumers splurged before the first sales-tax rise in 17 years last month. Gross domestic product grew an annualized 5.9 percent from the previous quarter, the Cabinet Office said today in Tokyo, more than a 4.2 percent median forecast in a Bloomberg News survey of 32 economists. Consumer spending rose at the fastest pace since the quarter before the 1997 tax increase, while capital spending jumped the most since 2011.
Today’s data add to signs the economy
will have sufficient momentum to bounce back from the 3 percentage point levy
rise that is set to trigger a contraction this quarter. Such resilience lowers
the odds of any imminent extra easing by Bank of Japan and, if sustained, could
persuade the government to proceed with a planned further increase in the tax
rate.
----Consumer spending rose 2.1 percent
from the previous quarter, the highest since a 2.2 percent increase in the
first three months of 1997.
The run-up in demand ahead of the tax
rise was more than expected, Economy Minister Akira Amari told reporters in
Tokyo today.
More
Japan Defense Academy Recruitment Jumps as China Tensions Rise
May 14, 2014 4:00 PM GMT
A 6:00 a.m. bugle call summons 22-year-old student Mutsumi Iida to begin a
day organized by the minute between study, sports and training until lights out
at 10:30 p.m. She picked the National Defense Academy over the freedom of an ordinary university as the best route to her dream of becoming an officer in Japan’s Marine Self-Defense Forces. The largest number of young people in 26 years followed in Iida’s footsteps to the college this year, as Prime Minister Shinzo Abe pushes a more active defense posture. Abe today will announce plans to reinterpret Japan’s pacifist constitution to expand the role of the military.
----Hemmed in by the
country’s charter and lingering resentment over World War II, Japan’s
Self-Defense Forces have not traditionally been a route to the top echelons of
business or government. Admiration for the defense forces’ role in disaster
relief, particularly after the 2011 tsunami, and a deepening territorial
dispute with China has fueled national pride and increased interest in the
academy even as recruits face an unaccustomed level of danger.
More
Up next, in
other Asian news, all Chinese look alike, at least to their neighbours in
Vietnam. America’s newest best buddy in Asia, looking to fight China to the
last American, has taken to attacking mostly Taiwanese firms, to hit back at
China’s oil drilling rig stationed in alleged Vietnamese waters. It’s a funny
old world in our new lawless age. Why does everyone want to go to war again?
“If it looks like a
duck,
quacks like a duck and walks like a duck, it's a black swan" says Graeme.
Anti-China Riot at Taiwan Steel Mill in Vietnam Kills 1
May 15, 2014 6:16 AM GMT
Anti-China
protests escalated in Vietnam as an attack on workers at the site of a
Taiwanese steel mill in a central province left one dead and 128 people
injured. Vietnamese staff at the mill in Vung Ang in Ha Tinh province yesterday looted the site, leaving 90 Chinese injured, and one Chinese person died of heat stroke, mill owner Formosa Plastics Group said in a statement. Taiwanese workers were not involved, it said.
The attack follows damage to factories in a southern province amid anger over a Chinese oil rig placed in disputed waters near the Paracel Islands claimed by both Vietnam and China. Vietnam and China fought a border war in 1979, with ties normalized in 1991.
----Authorities moved to restore order in the southern province of Binh Duong, where protests broke out at factory parks housing foreign companies on May 13. The Ministry of Public Security increased forces in the area and the situation has stabilized, the government said in a posting on its website.
Officials will talk to people to let them know they can protest to “express their patriotism in peaceful ways,” as long as they don’t “let bad people take advantage and complicate the situation,” it said.
China’s placement of the rig in contested waters near the Paracel Islands set off rallies in Vietnamese cities last weekend and protests in factory parks where foreign companies operate. Those protests turned violent, prompting Taiwanese companies with factories in Vietnam to halt operations.
With China, Singapore and Taiwan calling for Vietnam to protect their citizens in the country and China telling workers to limit outdoor excursions, Vietnam detained hundreds of protesters for questioning. The country is a hub for clothing and other factories and China is one of its major trading partners.
----Taiwanese
companies with factories in Vietnam halted operations, with some citing damage
to plants from the protests. One person was slightly injured and more than 200
Taiwanese people took refuge at a hotel in Binh Duong yesterday, according to
Chen Bor-show, director general of the Taipei Economic and Culture Office in Ho Chi Minh
City.
----Four Taiwanese airlines, plus Vietnam Airlines, will provide a combined 3,307 seats to fly people to Taiwan today, with a further 2,754 seats tomorrow, Taiwan’s Civil Aeronautics Administration said in an e-mailed statement. China Airlines will put on two extra flights today, it said.
“‘Thousands are leaving,’’ said Chen from the Taipei Economic and Culture Office. ‘‘They are waiting at the airport, waiting to take off,’’ he said today by phone.
More
More than 20 dead as anti-China riots spread in Vietnam
HANOI(Reuters) - More than 20 people were killed and rioters attacked Vietnam's biggest steel plant overnight as violent anti-China protests spread to the centre of the country a day after arson and looting in the south, a doctor and newspapers said on Thursday.
A doctor at a hospital in central Ha Tinh province said five Vietnamese workers and 16 other people described as Chinese were killed in the rioting, one of the worst breakdowns in Sino-Vietnamese relations since the neighbors fought a brief border war in 1979.
"There were about a hundred people sent to the hospital last night. Many were Chinese. More are being sent to the hospital this morning," the doctor at Ha Tinh General Hospital told Reuters by phone.
Hundreds of Chinese had fled Vietnam, either by air or by crossing into neighboring Cambodia, reports said.
----In Binh Duong alone, police said 460 companies in the province had reported some damage to their plants, local media reported.
More
Taiwan companies suffering big losses in Vietnam as China tensions grow
TAIPEIMay 14 (Reuters) - Taiwan companies doing business in Vietnam have lost billions of dollars as tensions mount tensions between Vietnam and China, an industry association said on Wednesday.
The losses included damage to manufacturing facilities which were set on fire, including those operated by Formosa Plastics Group, said Serena Liu, chairwoman of the Council of Taiwanese Chamber of Commerce in Vietnam.
Tensions rose in the resource-rich South China Sea last week after China positioned a giant oil rig in an area also claimed by Vietnam. Each country accused the other of ramming its ships near the disputed Paracel Islands.
We end on
Asia today with the Telegraph on India. Get ready for the “Hindu Putin” says
the Telegraph’s treasured AEP. Stay long fully paid up physical gold and silver,
he may be right. Trouble in Thailand again.
Modi's Thatcherite talk cannot restore India's flagging fortunes
India's superpower dreams are giving way to the same old reality of poverty
India’s economic model has essentially failed. Talk of matching East Asia’s growth rates has been exposed as wishful thinking. Superpower dreams are giving way to the same old reality of poverty, depleted ground water and graft.We can now see that growth averaging 8.2pc from 2004 to 2012 was an anomaly, kept alive by fiscal largesse at the top of the cycle. A torrid global boom masked all sins, itself the result of negative real interest rates in the West, the yen carry trade from Japan, China’s reserve accumulation and ultimately a flood of dollar liquidity that leaked everywhere from the US Federal Reserve.
India’s manufacturing industry remains stuck at 14pc of GDP. This is a far cry from levels in Thailand (30pc), South Korea (31pc) or China (32pc), or Japan in its day, the typical threshold for catch-up economies graduating to a higher league. India has actually lost 5m manufacturing jobs over the past decade, slipping from 55m to 50m.
The economic boom fizzled two years ago, ending in the sort of stagflation that bedevilled Britain in the 1970s. India’s “misery index” is back where it was a quarter of a century ago when the old Hindu Model was overthrown and the country embraced free market globalism, up to a point. The International Monetary Fund expects growth to languish at 4.6pc this fiscal year, with inflation at 10.5pc. “India has very little room to adopt countercyclical policies,” it said.
Voters have turned to Narendra Modi, a Hindu nationalist and celibate “monk” from the Rashtriya Swayamsevak Sangh movement who rose from tea boy to run the state of Gujarat as a relative haven of free enterprise. Billed as India’s Margaret Thatcher, or its Shinzo Abe, some wonder whether he is not really a Hindu Putin, a strongman who plays with ethnic fire sitting on top of a fraying economy.
More
Thai protesters force PM to flee meeting after three killed in Bangkok
By Amy Sawitta Lefevre
BANGKOK (Reuters) - Protesters seeking to oust Thailand's government broke into the grounds of an air force compound on Thursday where the acting prime minister was meeting the Election Commission to fix a date for new polls, forcing him to flee.
The disruption of acting Prime Minister Niwatthamrong Boonsongphaisan's efforts to organize an election came hours after gunmen attacked anti-government protesters, killing three.
The turmoil comes as the government loyal to ousted former premier Thaksin Shinawatra squares off with opponents backed by the royalist establishment over who should be prime minister, in the latest phase of nearly a decade of rivalry.
Hundreds of protesters converged outside an air force school in north Bangkok after word spread that Niwatthamrong was meeting commission officials there. They had put off talks at another venue the previous day because of security fears.
"We are here to tell Niwatthamrong that there is no point standing in our way," Chumpol Jumsai, a leader of the anti-government protesters, told the crowd from on top of a truck shortly before hundreds of protesters evaded police and streamed through a side entrance of the compound.
Commission member Somchai Srisutthiyakorn said the meeting was being abandoned and Niwatthamrong was leaving. "We will have to meet another day," he said.
The government sees a general election as the best way out of a crisis that threatens to tip Southeast Asia's second-biggest economy into recession and has even raised fears of civil war.
More
Turning to stagnant,
downwardly mobile Europe, did another black swan just settle in the Ukraine,
thanks to America’s greatest blunder yet of the 21st century?
Never believe anything in politics until
it has been officially denied.
Count Otto von Bismarck.
Ukraine Slides Deeper Toward War as Russia Warns on Vote
May 14, 2014 10:17 PM GMT
Russia’s foreign minister said Ukraine is sliding into a civil war that will make it
impossible to hold legitimate elections, as Ukrainian leaders and their
international allies blamed Russia for the violence. “When Ukrainians kill Ukrainians, I believe it’s as close to civil war as you can get,” Sergei Lavrov told Bloomberg Television in an interview in Moscow yesterday. “In the east and south of Ukraine, there is a war, a real war, with heavy weaponry used, and if this is something that is conducive to free and fair elections, then I don’t understand something about freedom.”
The Kiev government and its allies in
the U.S. and the European Union say Russia is behind the unrest in Ukraine’s
easternmost regions. The pro-Russian separatist groups there were excluded from
the national unity talks that started in the capital yesterday, aimed at easing
tensions before the May 25 presidential vote.
Rebels killed at least six paratroopers near the city of Kramatorsk on May 13, the deadliest attack on Ukrainian forces since the secession campaign began after Russia annexed Crimea in March.
“Quite a number” of the rebel fighters have also been killed, Lavrov said, as the Kiev government sent troops into the eastern regions to reassert control. Separatists in Luhansk and Donetsk, where unofficial ballots on breaking away from Kiev were held last weekend, have agreed to join forces to confront the central government.
----Some of Ukraine’s richest men have weighed in with suggestions. At the unity talks, Vadym Novinsky, a lawmaker and owner of LLC Smart Holding, said all of Ukraine’s parties and presidential candidates should commit to the country’s neutrality, “to calm down our eastern neighbor.”
On his website, billionaire Rinat Akhmetov said constitutional change to decentralize Ukraine is the “only proper way” out of the crisis, as alternatives such as secession for the eastern regions will lead to sanctions and economic damage.
Another billionaire, Petro Poroshenko, is the frontrunner for Ukraine’s presidential vote. Lavrov said Poroshenko isn’t a “fascist,” a term Russia applies for some forces in Ukraine’s interim government. He said the emergence of a Ukrainian leader with broad support may help diplomacy because “it’s easier to have such an interlocutor than self-appointed people.”
Lavrov also said that Russia has no intention of sending troops into eastern Ukraine. Russian President Vladimir Putin last week promised to move soldiers back from the border.
Even though Ukraine and the U.S. say he hasn’t fulfilled the pledge, it has prompted a rally on Russian financial markets, which extended gains yesterday. The benchmark Micex (INDEXCF) Index of stocks rose for a sixth day, adding 0.3 percent, and the ruble gained 0.6 percent against the dollar. Ukraine’s hryvnia fell 0.8 percent, taking its loss this year to 31 percent.
More
As rUK (rump
UK) prepares for its freedom from Scotland, now just four happy summer months
away, Merrie Olde England is rocked to its core by a terrible scandal. We may
be heading towards a future of numerous wars, but another black swan has just
landed in the world of cricket! The originally English game of the G&T and
the warm pint, complete with unfathomable rules and silly names, and often
taking five (yes five) days to play out, has apparently joined in our new
lawless age. Happily for all, suggests the Telegraph, Indian politics is likely
bring about an appropriate gentlemanly ending. Sadly, God is apparently not an
Englishman after all!
Baseball has the great advantage over
cricket of being sooner ended.
George Bernard Shaw, Irish socialist, alleged playwright.
Cricket rocked by new fixing evidence from New Zealand's former batsman Lou Vincent
Exclusive: Ex-Test player alleges corruption in county game and four other countries
Anti-corruption forces are investigating the most detailed evidence yet of widespread fixing across the cricketing world.Telegraph Sport can reveal that Lou Vincent, the former New Zealand batsman, has provided officials from the International Cricket Council’s anti-corruption unit with a treasure trove of information about matches which were targeted for spot-fixing and the names of players who were involved.
Domestic matches played by English counties are among those about which Vincent has provided detailed evidence from the period when he was playing for Lancashire and Sussex, along with details of fixing in at least four other countries.
He has also informed them of the details of an approach by another corrupt player to a current international captain, who turned down the offer and reported it to anti-corruption officials.
Investigators from the ICC’s anti-corruption unit are working with detectives employed by cricket boards around the world to piece together a complex case which they believe will emerge as the biggest fixing scandal since the Hansie Cronje affair 14 years ago, and possibly even more significant than that.
Vincent has agreed a plea bargain in the hope of avoiding a criminal prosecution for his involvement in and knowledge of spot-fixing in five or more countries over a four-year period between 2008-2012. He revealed in December he would co-operate with detectives and confessed to an ICC tribunal investigating fixing in Bangladesh earlier this year that he had been approached by an illegal bookmaker.
It is understood the ICC’s anti-corruption police are close to charging a former Pakistan international cricketer based on evidence provided by Vincent. The investigation crosses several international jurisdictions and is expected to take another 12-18 months to complete with anti-corruption officers determined to use the information and land convictions.
Several of his allegations are believed to involve matches played in the now defunct Indian Cricket League, where he said players were offered bribes of money and prostitutes by shadowy figures involved in the tournament. He has also provided names and dates of meetings with fixers which are being cross-referenced by the ICC.
His evidence has laid bare the threat of corruption to Twenty20 competitions in England and elsewhere which interest fixers in Asia when they are screened live on television in India.
More
And I don't watch cricket. How can you
like a game that requires you to take four days off work to follow a Test?
Thierry
Henry, Frenchie footballer.
At the Comex
silver depositories Wednesday
final figures were: Registered 56.04 Moz, Eligible 119.88 Moz, Total 175.92 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, Bloomberg with the joke of the month. Since Goldie London acts for most Russian billionaires and oligarchs, establishing their BVI and Swiss holding/hiding companies, and since the NSA spies on absolutely everyone from the President of the USA down to anyone with any sort of phone on the planet, tracing and chasing oligarchs “toys” is a walk in the park.
But does Uncle Scam really want to reveal to the world just how often Wall Street is merely a cover for its spooks? We are about to find out just how serious Uncle Scam’s sanctions against Russia really are. If serious, there goes the Italian luxury auto sector. Is the USA waging war against Russia or Europe?
“Call
it the Goldman Sachs test. If this is something Goldman would do to its
clients, don't do it."
Felix
Salmon.
U.S. Agents Start Hunting for Sanctioned Russians’ ‘Shiny Toys’
May 14, 2014 5:01 AM GMT
The Department of Homeland Security has begun a search for planes, yachts,
mansions and other U.S. belongings of Russians facing Ukraine-related
sanctions. Agents are looking for “shiny toys” that wealthy Russians on the sanctions list likely have hidden behind layers of shell companies, as well as their bank accounts and investments, said John Tobon, who heads the agency’s financial investigations division in Miami. The U.S. government has blacklisted 19 companies and 45 political and business leaders, including four it designated as members of Putin’s inner circle.
Any assets traced to blacklisted Russians will be frozen by the Treasury Department, which enforces sanctions, Tobon said. Agents from Homeland Security’s Foreign Corruption Investigations Group, including forensic accountants and intelligence analysts, are working on the case, along with other branches of the federal government, he said.
“This is the equivalent of the U.S. Treasury throwing up a bat signal -- it’s all hands on deck and here is your mission,” Tobon said. “The challenge comes to trying to find an asset that somebody is deliberately trying to hide.”
Freezing
the assets could “translate quickly into political pressure” on Russian
President Vladimir
Putin, said Neil Shearing, chief emerging market economist for Capital
Economics Ltd. in London.
“Russian oligarchs made money in Russia and enjoyed the fruits of that money in the West,” he said. “If you squeeze that, then it will create some kind of pain.”
Asked about the U.S. investigation, Kremlin spokesman Dmitry Peskov said, “Nobody informed us, but I don’t find these efforts surprising at all.”
A Russian law adopted last year prohibits government officials and executives of state-owned companies from holding bank accounts or financial instruments abroad. They are allowed to own property outside Russia, provided they declare it and explain where the money for the purchase came from.
Russian oligarchs for years have shielded assets abroad in case they fall out of favor with Putin’s regime. While Putin has been urging businessmen to bring their money back home, a net $51 billion of Russian capital was removed from the country in the first quarter, the biggest quarterly outflow since 2008, according to data from the central bank.
Now those foreign assets may be vulnerable to sanctions. Persons under sanctions are barred from traveling to the U.S., and their assets are blocked. U.S. companies and individuals are prohibited from doing business with them.
More
Russia will not soon become, if it ever
becomes, a second copy of the United States or England - where liberal value
have deep historic roots.
Vladimir Putin.
The monthly Coppock Indicators finished April
DJIA: +189 Down. NASDAQ: +347 Down. SP500: +249 Down. Sell in May, go away.
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