Baltic Dry Index. 1022
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
"For more than two thousand years gold's natural qualities made it man's universal medium of exchange. In contrast to political money, gold is honest money that survived the ages and will live on long after the political fiats of today have gone the way of all paper."
Hans F. Sennholz
This morning
we are back to “the glass is half full” again,
as China’s currency devaluation appears to be paying off. Of course, it
might just be last year’s data distortions working out of the system, or in a
top down system, merely the underlings meeting the Princeling’s targets, no one
wants a visit to an economic re-education camp after all, but whatever the
reason, the spin is that the boom is coming back. Devaluation works! Shame about
Europe’s PIIGS trapped in the Germanic Bilderberger euro, facing a lost
generation to high unemployment.
Below, why
China’s unelected Communists won’t have to bring out the punch bowl yet ag. Or
at least until the shadow banking system really collapses, or they start a
fight with some of their neighbours. Stay long fully paid up precious metals.
"The paper standard is self-destructive."
Hans F. Sennholz
China’s Trade Unexpectedly Rises
May 8, 2014 5:13 AM GMT
China’s exports and imports (CNFRIMPY) unexpectedly rose in April,
helping leaders put a floor under a slowdown in the world’s second-biggest
economy. Overseas shipments increased 0.9 percent from a year earlier, when figures were inflated by fraudulent invoicing, data from the Beijing-based customs administration showed today. That compared with the median estimate for a 3 percent drop in a Bloomberg News survey of analysts. Imports gained 0.8 percent, leaving a trade surplus of $18.46 billion.
China stocks headed for the biggest gain in four weeks as the figures, and a report showing Australia added more jobs than projected in April, increased signs of improving global expansion. Export gains would reduce the urgency for Communist Party leaders to resort to larger-scale stimulus than railway spending and tax breaks, after first-quarter growth slowed to the weakest pace in six periods.
“The signs of improvement in Chinese exports are clear,” said Ding Shuang, senior China economist with Citigroup Inc. in Hong Kong. Shipments may rise by close to 10 percent this month, and stronger growth “will create pressure for China to reverse the recent yuan depreciation,” said Ding, who formerly worked at the People’s Bank of China and International Monetary Fund.
China’s trade data have been distorted this year after figures in early 2013 were inflated by falsified invoices used to disguise capital flows, triggering a government crackdown on the practice. April may mark the final month of the distortions and May data will compare with what Royal Bank of Scotland Group Plc economist Louis Kuijs says were “pretty clean” numbers in the same period last year.
Underlying export growth accelerated to about 8 percent in April from 3.5 percent in March after adjusting for over-invoicing issues, Kuijs estimated today. Import gains were “subdued,” reflecting slow demand expansion in China, Kuijs wrote in a note
More
South China Sea Tensions Flare as China Presses Claims
May 8, 2014 4:41 AM GMT
Tensions in the South China Sea are escalating as the Philippines
and Vietnam
push back against Chinese moves to assert control over the resources of
disputed maritime areas. Vietnamese stocks fell the most since 2001 after the government said yesterday that Chinese boats intentionally rammed Vietnamese vessels during a confrontation over the placement of an exploration rig by China in waters near the Paracel Islands, claimed by both countries. Armed Philippine police also arrested Chinese fishermen near a disputed shoal close to the disputed Spratly Islands.
China responded by accusing both countries of violating its sovereignty over the island chains, saying Vietnam was being “disruptive” and demanding the release of the boat crew by the Philippines. Vietnam’s benchmark VN Index fell as much as 5.5 percent, the biggest decline since Oct. 2001, and was down 4.4 percent at 10:25 a.m. in Hanoi.
The incidents come as China’s Asian neighbors have been seeking closer ties with the U.S. as they push China to agree to a code of conduct to avoid conflicts over seas that are rich in oil and gas. Chinese President Xi Jinping is expanding the country’s naval reach to back its claims to huge swaths of the South China Sea that is based on China’s so-called “nine-dash line” map, first published in 1947, that extends hundreds of miles south from China’s Hainan Island to the equatorial waters off the coast of Borneo.
More
Well aware
of what America is about in the Ukraine, China’s taking steps to reduce “containment.”
What are the odds that this all ends in a hot war? If not war 2014, there’s six
more years of this decade to go, before the Graphene Age starts kicking in.
Even then, we’ll still be in a war for resouces.
China aims to boost military relations with Iran
BEIJING(Reuters) - China wants deeper defense ties with Iran, Chinese Defense Minister Chang Wanquan told his Iranian counterpart on Monday, according to Chinese state media, as Beijing moves to cement already close ties with a major oil supplier.
Chang told Iranian Defense Minister Hossein Dehqan the development of bilateral relations has "remained positive and steady, featuring frequent high-level exchanges and deepened political mutual trust", the official Xinhua news agency said.
Chang is "confident that the friendly relations between the two countries as well as the armed forces will be reinforced" due to "increased mutual visits and personnel training cooperation between the armed forces", Xinhua added.
Dehqan "voiced the hope that the two countries will continue to play a positive role in safeguarding regional peace and stability", the agency said
More
In the one
size fits all disaster known as Euroland, Germany unexpectedly stumbled even
before the blowback from suicidal Russian sanctions have had time to kick in.
When Germany sneezes Club Med goes straight into Intensive Care. It looks more
and more like the Bilderberger euro was a traitorous bureaucratic plot against
continental Europeans.
Below, the
latest news from Europe before the self imposed Russian calamity hits.
"The most puzzling development in politics during the last decade is the apparent determination of Western European leaders to re-create the Soviet Union in Western Europe."
Mikhail Gorbachev
German Factory Orders Unexpectedly Drop Amid Risks
May 7, 2014 7:00 AM GMT
German factory orders unexpectedly fell in March, signaling that growth in
Europe’s largest economy remains uneven. Orders, adjusted for seasonal swings and inflation, fell 2.8 percent from February, when they increased a revised 0.9 percent, the Federal Statistics Office in Wiesbaden said today. Economists forecast a gain of 0.3 percent, according to the median of 37 estimates in a Bloomberg News survey.
The German economy is set for “dynamic, broad-based” growth, the European Commission said in its quarterly forecast, even as the Bundesbank warned that expansion will slow “noticeably” after a very strong first quarter. The country faces headwinds including a low inflation rate, a slowdown in China and rising tension with Russia as it leads the exit of the euro area from its longest-ever recession.
“There are risks that could slow down growth,” said Michael Holstein, an economist at DZ Bank in Frankfurt. “But the major positive factor from abroad is that the euro area is recovering, and the effect for the German industry is bigger than negative influence from China or Russia.”
Domestic orders decreased 0.6 percent in March from the previous month, while export orders declined 4.6 percent, today’s report showed. Orders from the euro area fell 9.4 percent while those from outside the bloc dropped 1.7 percent.
More
ECB is delighted by the splendid prospect of deflation
The great mystery is why the voting public of debtor states continue to put up with an arrangement that ensures years of mass unemployment
If Europe's elites seem nonchalant about the deflation threat staring them in the face, it is because they do not share the Anglo-Saxon and Japanese orthodoxy that letting it happen is an unforgivable policy failure.The handful of officials calling the shots at the European Central Bank and Germany's finance ministry -- with applause from Italy's hard-money "Bocconi Boys" and Spain's "Austrian School" ultras -- do not think deflation would be traumatic even if it were to happen. Some rather like the idea.
Their champion is Jaime Caruana, head of the Bank for International Settlements (BIS). "The historical evidence indicates that deflations have often been associated with sustained growth in output. The Great Depression was more the exception than the rule," he said in a seminal speech last month.
----Mr Caruana's speech is superb in many ways, and worth reading. He lays out a damning case against quantitative easing (QE) and what he deems the bad habits of modern central banking. "As policymakers respond asymmetrically over successive business and financial cycles, hardly tightening or even easing during booms and easing aggressively and persistently during busts, they run out of ammunition and entrench instability," he said.
His point is that zero interest
rates and blasts of money are not "equilibria phenomenon". They steal
growth from the future. They are a quick fix at the risk of "more
wrenching pain further down the road".
More
François Hollande versus the French people: president flops in TV questioning
Tuesday 06 May 2014
François
Hollande, the most unpopular French president in living memory, demonstrated
the perils of wanting to be known as the “normal” leader by subjecting himself
to a surreal hour-long television and radio grilling to mark the second
anniversary of his election.
He took questions from listeners,
including a 61-year- old woman who asked him whether he could live on her €662
(£550) monthly pension. “No,” he replied.
Earlier, the BFM TV interviewer
Jean-Jacques Bourdin took a leaf out of Jeremy Paxman’s book to accuse the
President of “amateurism” and of conducting a “reckless” private life which had
cheapened the presidency. “You talk about [economic] recovery,” said Bourdin,
“where is it?”
The Socialist President, who
admitted to “regrets”, batted away the criticism and vowed to speed up economic
reforms. He said that he should be judged on results “at the end of my mandate”
in 2017.
Mr Hollande has identified his
main priority as reversing the growth in unemployment, which stands at 9.8 per
cent, and acknowledged that he had failed to fulfil a pledge to do so by the
end of last year. He repeated that unless the number of jobless came down, he
would not stand for a second term. “How can I run again if I fail on that?” he
said.
Asked by Bourdin whether he would
be “disappointed” if he had voted for himself, Mr Hollande replied that he
would be “impatient, not disappointed”. He sought to place the blame on his
centre-right predecessor, Nicolas Sarkozy, who had left France “on the verge of
bankruptcy” and with industrial competitiveness in decline. After facing “the worst
crisis in the eurozone”, finances had now been stabilised, he said.
More
While the
news from China’s currency devaluation might be good, the OECD isn’t buying it.
Currency wars, QE Forever, ZIRP or not, the global economy is still slowing they
think. If they think it’s slowing now, just wait until US led Russian sanctions
kick in, slamming much of continental Europe into the dustbin of history.
OECD Cuts Global Growth Forecast as Emerging Markets Cool
May
6, 2014 10:00 AM GMT
The Organization for Economic Cooperation and Development cut its global
growth forecast as expansions in China
and other emerging
markets slow. The world economy will expand 3.4 percent this year instead of the 3.6 percent predicted in November, the Paris-based organization said in a semi-annual report today. China will grow 7.4 percent, down from a previous projection of 8.2 percent.
“Part of this deceleration is benign, reflecting cyclical slowdowns from overheated starting positions,” said OECD Chief Economist Rintaro Tamaki. “However, managing the credit slowdown and the risks that built up during the period of easy global monetary conditions could be a major challenge.”
The OECD’s second reduction in global growth forecasts in six months underlines the challenges facing policy makers even as developed countries recover from the financial crisis. The group also said events in Ukraine have heightened geopolitical uncertainty, a factor also referenced by the International Monetary Fund in its global outlook in April.
More
In European war news, today’s update comes from Bloomberg. Since it doesn’t fit the current spin from the War Party, don’t expect to see it make mainstream media in the west. Dead protesters in Kiev yes. Outrage! Dead Russians in Odessa, no. It was “our” side doing the killing.
“Who elected this government?” Kiriyev shouted, outraged over the ouster of Kremlin-backed President Viktor Yanukovych in Kiev in February. “They elected themselves!”
Actually they were elected by America. If this all ends up in war, the world knows who to blame and who to bill.
Horror in Odessa as Fire Shatters Jewel of Tsarist Russia
May 7,
2014 11:00 PM GMT
Vladimir Kiriyev says he was walking with his children near their apartment
in Odessa when he saw an attack on a pro-Russia camp as
the assailants backing Ukrainian unity set tents on fire and beat everyone who
tried to flee. That was just one in a series of clashes in Ukraine’s third-largest city on May 2 that culminated in the deaths of at least 40 pro-Russian activists who were chased into a building that went up in flames. The violence, not seen here since World War II, is fanning fear of a full-blown civil war like the bloody breakup of Yugoslavia that left more than 100,000 dead and millions more displaced in the 1990s.
“We must do everything to avoid this military scenario,” Nikolai Skorik, a former governor of Odessa who’s now a local lawmaker, said in an interview. “We have to stop dividing people into two camps, separatists and defenders of independence, unless we want to end up like Yugoslavia.”
For Kiriyev, a 40-year-old father of four, the horror was too great to sit idly by. He joined the mob that stormed the local police headquarters two days later to free 67 pro-Russia activists detained during the fighting.
“Who elected this government?” Kiriyev shouted, outraged over the ouster of Kremlin-backed President Viktor Yanukovych in Kiev in February. “They elected themselves!”
----Modern Odessa was founded in 1794 by Catherine the Great to provide a Black Sea port for the Russian Empire’s expansion. By the beginning of the 20th century, it had become Russia’s most important commercial hub after Moscow and St. Petersburg. Ethnic Russians today account for 30 percent of the population.
----A new flashpoint may come tomorrow if rival camps rally for Victory Day, a holiday commemorating the defeat of Nazi Germany in World War II in both Ukraine and Russia, where Putin will oversee a military parade on Red Square.
“Tensions have been building for a long time and now we’ve reached a point of no return,” said Oleg Gubar, a historian in Odessa who’s critical of the central government. “They won’t forgive what happened.”
The loss of regions in the east and south, including Odessa, Ukraine’s largest port, would render the country landlocked and cut the economy in half, according to Alexander Valchyshen, chief economist at Investment Capital Ukraine in Kiev.
More
http://www.bloomberg.com/news/2014-05-07/horror-in-odessa-as-fire-shatters-jewel-of-tsarist-russia.html
Ukraine crisis: Transcript of leaked Nuland-Pyatt call
7 February 2014
An apparently bugged phone conversation in which a senior
US diplomat disparages the EU over the Ukraine crisis has been posted online.
The alleged conversation between Assistant Secretary of State Victoria Nuland
and the US Ambassador to Ukraine, Geoffrey Pyatt, appeared on YouTube
on Thursday. It is not clearly when the alleged conversation took place.
Here is a transcript, with analysis by BBC diplomatic correspondent Jonathan Marcus:
Warning: This transcript contains swearing.
Jonathan Marcus: At the outset it should be clear that this is a fragment of what may well be a larger phone conversation. But the US has not denied its veracity and has been quick to point a finger at the Russian authorities for being behind its interception and leak.
More
http://www.bbc.co.uk/news/world-europe-26079957
"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
At the Comex
silver depositories Wednesday
final figures were: Registered 55.00 Moz, Eligible 120.36 Moz, Total 175.36 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today it’s Spooks Corner. The NSA hacks into
Russia with the “real” results of the Crimean referendum. It’s a real crime
they assert. Perhaps the NSA could also tell us who really won the US
Presidential election at the turn of the century. I have no idea which alphabet
soup black arts group manufactured today’s scoop, but I rate it alongside the "Zinoviev
Letter."
Truth
is the first casualty of war, and make no mistake about it, the west now seems
to be at war with Russia over the botched US coup in Kiev.
You get so used to lying that after a while it’s hard to
remember what the truth is.
Philip Agee
Putin's 'Human Rights Council' Accidentally Posts Real Crimean Election Results
5/05/2014 @ 4:44PM
As you may recall, the official Crimean
election results, as reported widely in the Western press, showed a 97
percent vote in favor of annexation with a turnout of 83 percent. No
international observers were allowed. The pro-Russia election pressure would
have raised the already weak vote in favor of annexation, of course.
Yesterday, however, according to a major Ukrainian news site, TSN.ua, the website of the President of Russia’s Council on Civil Society and Human Rights (shortened to President’s Human Rights Council) posted a report that was quickly taken down as if it were toxic radioactive waste. According to this purported report about the March referendum to annex Crimea, the turnout of Crimean voters was only 30 percent. And of these, only half voted for the referendum–meaning only 15 percent of Crimean citizens voted for annexation.
The TSN report does not link to a copy of the cited report. However, there is a report of the Human Rights Council, entitled “Problems of Crimean Residents,” still up on the president-sovet.ru website, which discusses the Council’s estimates of the results of the March 16 referendum. Quoting from that report: “In Crimea, according to various indicators, 50-60% voted for unification with Russia with a voter turnout (yavka) of 30-50%.” This leads to a range of between 15 percent (50% x 30%) and 30 percent (60% x 50%) voting for annexation. The turnout in the Crimean district of Sevastopol, according to the Council, was higher: 50-80%.
----To make sure no one misses this:
Official Kremlin results: 97 percent of polled voters for annexation, turnout 83 percent, and 82 percent of total Crimean population voting in favor.
President’s Human Rights Council mid-point estimate: 55 percent of polled voters for annexation, turnout 40 percent, 22.5 percent of total Crimean population voting in favor.
A member of the Human Rights Council, Svetlana Gannushkina, talked about election fraud on Kanal 24 (as replayed on Ukrainian television), declaring that the Crimean vote “discredited Russia more than could be dreamed up by a foreign agent.”
We can debate the extent of fraud in the March 16 referendum, but only the Council’s highest estimate just yields the fifty percent turnout ratio normally required for major referendums. What counts is that the Putin regime solemnly announced to the world that 82 percent of the Crimean people voted to join Mother Russia, and many in the West swallowed this whopper. At best, according to Putin’s own council, only 30 percent did.
Putin plans to repeat the Crimean election farce in the May 11 referendum on the status of the so-called People’s Republic of Donetsk. He will use the same tricks to produce an overwhelming vote for “independence” and a high turnout. The few international election monitors will object, but Putin counts on repetition of his Big Lie to convince his own people and sympathetic politicians and press in the West that the people of east Ukraine actually want to separate from Ukraine.
More
Zinoviev letter
The "Zinoviev Letter"
was a controversial document published by the British press four days before
the general election in 1924. It
purported to be a directive from the Communist International in Moscow to the Communist Party of Great Britain.
The letter took its name from the apparent signature of a senior Soviet official
Grigory
Zinoviev. The letter seemed authentic at the time but historians now
believe it was a forgery. It called for intensified communist agitation in
Britain. Historians now agree that the letter had little impact on the Labour vote—which held up in 1924. However, it
aided the Conservative Party in hastening the collapse of the Liberal party
that led to the Conservative landslide.[1]
A.J.P.
Taylor argues that the most important impact was on the psychology of
Labourites, who for years blamed their defeat on foul play, thereby
misunderstanding the political forces at work and postponing needed reforms in
the Labour Party.
More.
The habits and language of clandestinity can intoxicate even its
own practitioners.
William Colby.
The monthly Coppock Indicators finished April
DJIA: +189 Down. NASDAQ: +347 Down. SP500: +249 Down. Sell in May, go away.
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