Baltic Dry Index. 989 +12
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
Unlike
my opponent, I will not let oil companies write this country's energy plan, or
endanger our coastlines, or collect another $4 billion in corporate welfare
from our taxpayers.
Barrack
Obama.
The D-Day commemorations
past and the World Cup football competition not yet started in edgy Brazil, we
open today with more red flags from China. In real estate, the decline is
turning into a rout. More bankruptcies and scandal is a certainty. China’s
shadow banking system is headed from wobble towards earthquake. In May, China’s
trade surplus surged, as exports jumped and imports slumped compared to May
last year. Last year China was in the midst of a false accounting scandal, so
the direct comparison is more complicated, but an unexpected import slump,
suggest to me trouble ahead for the iron ore, coal, and copper exporting BRICs,
as China’s economy continues to cool, putting pressure on commodity prices and
the Baltic Dry (shipping) Index.
Exports to Europe,
China’s largest export market, are unlikely to thrive in 2014, while spats with
other nations in east and southeast Asia, are likely to act as a drag on Asian
exports. China’s export jump might just be a flash in the pan.
"The paper standard is self-destructive."
Hans F. Sennholz
China’s Home Prices to Fall as Developers Cut Prices, S&P Says
Jun 9, 2014 5:32 AM GMT
Home prices will fall 5 percent
this year compared with an 11.5 percent gain in 2013, the New York-based
ratings company said in an e-mailed report today. Sales volume will improve in
the second half of the year and rise 10 percent for the full year, boosted by
price cuts, according to the report.
“Prices are likely to continue to
slide because of large inventory in some markets,” Hong Kong-based analysts,
led by Bei Fu, wrote in the report. “Many small unrated developers will feel
the heat the most because their sales and financing capacities are
substantially weaker than their larger peers’. Some lower-tier cities with
limited demand and abundant supply could see deeper downward price
adjustments.”
----Moody’s
Investors Service revised its credit outlook for Chinese developers to negative
from stable last month.
More
China’s Property Developers Face Record Wave of Maturing Debt
Jun 6, 2014 5:17 AM GMT
Chinese property developers face a record surge in maturing debt next year,
as the country’s banking regulator says it’s monitoring risks from the cooling
real-estate market. The amount of dollar-denominated bonds that must be repaid in 2015 will jump to $2.83 billion, the most in data compiled by Bloomberg going back to 1993. Most Chinese builders listed on the mainland or in Hong Kong are behind fiscal-year sales targets and achieved less than 33 percent of their target in the first four months, analysis based on Bloomberg data show.
The China Banking Regulatory Commission will monitor the financial and cash-flow conditions of developers, and will support first-time homebuyers’ borrowing needs, Vice Chairman Wang Zhaoxing said at a briefing in Beijing today. Moody’s Investors Service revised its credit outlook for Chinese builders to negative in May after home sales slumped 10 percent in the first four months.
More
China’s Export Gains to Cushion Growth as Imports Slump
Jun 9, 2014 4:32 AM GMT
China’s exports rose more
than analysts estimated in May, helping to cushion the
world’s second-biggest economy from a deeper slowdown as an unexpected slump in
imports highlighted risks to growth. Overseas shipments gained 7 percent from a year earlier, the customs administration said yesterday in Beijing, exceeding the 6.7 percent median forecast in a Bloomberg News survey. Imports fell 1.6 percent, leaving a $35.92 billion trade surplus, the biggest in five years according to Bloomberg data.
“The export figures are positive news for policy makers and we expect continued solid export growth in the coming months amidst gradually improving global demand momentum,” said Louis Kuijs, chief China economist at Royal Bank of Scotland Plc in Hong Kong. “The import data suggest a pretty subdued state of the domestic economy though and the dilemma for the government is how to balance the need to reduce growth in leverage with all the calls for support.”
None of 42 economists had forecast a decline in imports. Their median estimate was for a 6 percent gain
----China’s trade data have been distorted this year after figures in early 2013 were inflated by falsified invoices used to disguise capital flows. That triggered a government crackdown and led to a slump in year-over-year export growth in May of that year to 0.9 percent from 14.6 percent in April.
Trade numbers for May this year
probably marked the first set of ‘‘clean” data free of the impact of
distortions, according to RBS’s Kuijs.
More
Canary In The Iron Ore Pits: Prices Plunge Below $100; Massive Glut Building
by David Stockman •
The deformations in the global economy arising from the central bank
fueled credit deluge of the last two decades become more visible and
foreboding by the day. One vector of special salience is the global iron ore
market where prices have now punctured the $100 per ton mark to $94,
and are down 50% from a peak of $200 in 2012.The action here is not just another commodity cycle, but instead is a proxy for the global credit bubble, China department. During the course of its mad scramble to become the world’s export factory and then its greatest infrastructure construction site, China’s expansion of domestic credit broke every historical record and has ultimately landed in the zone of pure financial madness. To wit, during the 14 years since the turn of the century China’s total debt outstanding–including its vast, opaque, wild west shadow banking system—soared from $1 trillion to $25 trillion, and from 1X GDP to upwards of 3X.
But these “leverage ratios” are actually far more dangerous and unstable than the pure numbers suggest because the denominator—national income or GDP—-has been erected on an unsustainable frenzy of fixed asset investment. Accordingly, China’s so-called GDP of $9 trillion contains a huge component of one-time spending that will disappear in the years ahead, but which will leave behind enormous economic waste and monumental over-investment that will result in sub-economic returns and write-offs for years to come.
More
Up next, so
you really want to try to boycott Russian oil and natural gas? President Obama
picked an incredibly inapt time to pick a fight with Saudi Arabia over
switching horses on Iran, and declare war on Russia due to a botched CIA coup
in Kiev that handed the Crimea back to Russia. As seen from London and outside
the Westminster bubble, a Russian oil or natural gas boycott is a sure fire way
to bring on a global recession and a depression in continental Europe. Even
Jean-Claude Juncker doesn’t deserve that.
Been
in this game one-hundred years, but I see new ways to lose 'em I never knew
existed before.
Casey
Stengel.
World Needs Record Saudi Oil Supply as OPEC Convenes
Jun 9, 2014 5:38 AM GMT
OPEC ministers say they will almost certainly leave their oil-production
ceiling unchanged when the group meets this week. What really matters for
global markets is whether Saudi Arabia will respond to global supply shortfalls by
pumping a record amount of crude. Just six months ago, energy analysts predicted output from the Organization of Petroleum Exporting Countries would climb too high and Saudi Arabia needed to cut to make room for other suppliers. They changed their minds after production from Libya, Iran and Iraq failed to rebound as anticipated, and industrialized nations’ stockpiles fell to the lowest for the time of year since 2008. Saudi Arabia may need to pump a record 11 million barrels a day by December to cover the other member nations, says Energy Aspects Ltd., a consultant.
“Now it’s not whether the Saudis will make room, but whether they’ll keep it going and maintain enough spare capacity,” said Jamie Webster, a Washington-based analyst at IHS Inc., an industry researcher. “OPEC is increasingly having a hard time just doing its job of bringing all the barrels needed.”
Even as the North American shale revolution propels U.S. production to a three-decade peak, supply in other parts of the world is faltering. A battle for political control in Libya, pipeline attacks in Iraq and prolonged sanctions against Iran are preventing those nations from reviving output. While U.S. crude inventories rose to a record in April, restrictions on exports are keeping those supplies in the country, tempering forecasts that global oil prices will decline this year.
----The International Energy Agency, the Paris-based adviser to 29 nations, recommended on May 15 a “significant rise in OPEC production” to meet demand of 30.7 million barrels a day in the second half of the year. Oil inventories in advanced nations were at 2.62 billion barrels in April, the lowest for that month since 2008, the year Brent reached a record $147.50 a barrel, IEA data show.
Boosting output that high would be “a Herculean task for the group to surmount given that production has been below 30 million barrels a day for the last five months,” London-based Energy Aspects said in a May 27 research note.
More
Formula
for success: rise early, work hard, strike oil.
J.
Paul Getty
At the Comex silver depositories Friday final figures were: Registered 57.01 Moz, Eligible 118.62 Moz, Total 175.63 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today, staying with Asia and crooks, its India’s turn to try to reign in the tax cheats. If they even half way succeed in their target, the rest of the world , but especially Switzerland, London and Paris, would lose about one trillion USD liquidity under pinning their economies. In our new lawless age of the 21st century, one nation’s tax cheat is all too often another nation’s inward investor.
How much Ukrainian money is stashed in London, Switzerland and Moscow? How much French wealth migrated to London under the policies of love-rat Hollande? How much Russian wealth moved via the BVI and Jersey to London and Cyprus? How will England’s Premier League football clubs survive without Russia? How will Vancouver survive without Red China? Where would America’s one percenter’s be without Switzerland’s UBS? Given the speed or lack of it in Indian law and bureaucracy, ounds like boom time for the rest of the century for lawyers and accountants.
In Delaware, the largest growth in population
is Indian-Americans moving from India. You cannot go to a 7-11 or a Dunkin
Donuts unless you have a slight Indian accent. I'm not joking.
US Vice President Joe Biden.
Hidden Assets Seen Worth $2 Trillion Targeted by India
Jun 8,
2014 11:00 PM GMT
India’s
(INGDPY) new Prime Minister Narendra Modi
didn’t waste much time: Among his first acts on his first day in office was to
make it a priority to recover billions of dollars stashed overseas to avoid
taxes. Within 24 hours of his May 26 inauguration, Modi created an investigative team of former judges and current regulators to find the concealed assets, known as black money, and bring them back. At stake is what’s estimated to be as much as $2 trillion, more than India’s annual gross domestic product.
“It will send out a loud and clear signal to all tax evaders,” said Arun Kumar, author of “The Black Economy in India” and an economics professor at Jawaharlal Nehru University in New Delhi, who calculated the $2 trillion figure. “There was always a lack of political willpower, and I hope it will be different this time.”
India
is joining countries including the U.S. and Britain in cracking down on rich
people who haven’t reported offshore funds. The nation ranked third in the
world for money illegally moved overseas in 2011, behind China and Russia, according
to a 2013 report by Global Financial Integrity, a
Washington-based group researching cross-border money transfers. High-net-worth
individuals and private companies are the “primary drivers of illicit flows,”
the group said in a 2010 report.
Asia’s third-largest economy loses an estimated 60 trillion rupees ($1 trillion) each year from its formal sector, such as banks, and almost 6 trillion rupees of that is moved out of the country, according to Kumar, who analyzed independent studies and World Bank and International Monetary Fund data on trade flows. His $2 trillion estimate is the total amount Indians currently have stashed abroad illegally, without paying taxes in the South Asian nation or disclosing the funds to authorities.
Tax revenue on those assets could exceed $600 billion, based on a 30 percent rate plus penalties, Kumar said. That’s six times the amount the federal government estimates it will need to borrow this year to meet expenses.
More
There
exists no politician in India daring enough to attempt to explain to the masses
that cows can be eaten.
Indira
Ghandi.
The monthly Coppock Indicators finished May
DJIA: +181 Down. NASDAQ: +340 Down. SP500: +246 Down. Crisis? What crisis?
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