Baltic Dry Index. 1151 +04
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
If
all else fails, immortality can always be assured by spectacular error.
J. K.
Galbraith.
The conditioning of the public for a war with
Russia over the Ukraine has gone into overdrive. Is a real war now inevitable,
not just a suicidal for Europe trade war, that only benefits America and
American companies.
Below, the western propaganda that can have only
one outcome if maintained. Get out of Euros and western European banks. There’s too much danger in European banks of
another forced depositor bail-in if economic collapse in Europe follows on from
the next round of sanctions on Russia, or worse yet, the EU’s new unelected
ruling team, trigger a hot war with Russia.
Patriotism
is supporting your country all the time, and your government when it deserves
it.
Mark
Twain.
Ukraine Warns of Europe’s Worst Conflict Since World War II
Sep 1, 2014 7:00 PM GMT
Ukraine warned of an escalating conflict in its easternmost regions as a
rebel leader said talks this week may include negotiations for a truce. The country’s military will take on Russia’s “full-scale invasion,” Defense Minister Valeriy Geletey said on Facebook today, a shift away from the government’s earlier communication that focused on an offensive against insurgents. Ukraine “must urgently build up defenses against Russia,” which is seeking “to advance to other areas in Ukraine,” Geletey said.
Ukraine and its allies in the U.S. and Europe are accusing Russia of dispatching troops and backing militias to open a new front in the conflict that the United Nations estimates has claimed 2,600 lives. The Kremlin has repeatedly denied involvement in the unrest. Talks today between representatives from Russia, Ukraine, the Organization for Security and Cooperation in Europe and the separatists will continue Sept. 5.
“We can truly imagine some very dark scenarios now,” OSCE Chairman Didier Burkhalter said on Swiss state television today. “We are in a very delicate phase.” As long as the war continues, “the risks of escalation are very, very numerous.”
More
I can take Kiev in two weeks, Vladimir Putin warns European leaders
The Russian president is reported to have boasted his forces could sweep into Kiev in a fortnight if he wanted to as Nato announced it would build a new “spearhead” rapid reaction force
9:11PM BST 01 Sep 2014
Vladimir
Putin has boasted to European leaders that his forces could sweep into
Kiev in two weeks if he wanted.
The Russian president reportedly
made the threat to the European Commission president during talks on the Ukraine
crisis.
Mr Putin told Jose Manuel
Barroso: “If I want to, I can take Kiev in two weeks,” Italy’s La Repubblica
newspaper reported, implying this could be the result if the EU stepped up
sanctions against Russia.
His comments, relayed by Mr
Barroso to colleagues at last weekend’s EU summit, emerged as Nato announced it
would build a new “spearhead” rapid reaction force of up to 4,000 troops that
can be flown into eastern Europe in 48 hours to respond to possible Russian
aggression.
The EU’s new head of foreign
policy, Federica Mogherini, also warned there was no military solution to what
is now Europe’s biggest crisis in decades.
Anders Fogh Rasmussen, secretary
general of the alliance, said Nato faced multiple crises on its southern and
eastern borders that could erupt at any time.
Leaders of the alliance’s 28
members are expected to agree to the new force at this week’s Nato summit in
Wales, and it is likely to include British troops.
The spearhead force is part of a
package of measures to sharpen up the alliance as it faces crises in Iraq and Ukraine.
A senior Nato official said
allies would take turns to command the spearhead and many of the arrangements
would be in place by the end of the year. Troops would be based in their home
countries and come together when necessary.
The summit will agree to
stockpile supplies in eastern Europe so that equipment and ammunition are
waiting for the force when it arrives.
More
Putin Raises Statehood for Southeast Ukraine as Kiev Cites Russian Tank Battalion in Airport Fight
Sep 1, 2014 2:14 PM GMT
Negotiations got under way in Belarus today to seek an end to the fighting
in southeastern Ukraine, as the government in Kiev claimed about 1,600 Russian
soldiers were advancing into the region. The ruble slid to a record against the dollar for a second day as the intensified conflict raised the likelihood that Russia will face wider European Union sanctions. German Chancellor Angela Merkel said Europeans won’t accept Russia’s military incursion into Ukraine.
“Being able to change borders in Europe without consequences, and attacking other countries with troops, is in my view a far greater danger than having to accept certain disadvantages for the economy,” Merkel said today at a press conference in Berlin.
Representatives
from Russia, Ukraine, the Organization for Security and Cooperation in Europe
and the pro-Russian separatists met in Minsk for the latest international
consultations aimed at restoring peace. So far, Russian President Vladimir
Putin has resisted pressure to halt his support for the rebels.
The
self-declared people’s republics of Donetsk and Luhansk are demanding greater
autonomy in exchange for guaranteeing “maximum effort” to preserve united
Ukraine and support peace, RIA Novosti reported, citing a document prepared for
the talks.
In Kiev, National Security Council spokesman Andriy Lysenko said at least four Russian battalions totaling about 1,600 soldiers are taking part in military operations in southeast Ukraine. There was no immediate response from Russia, although Putin’s government has said previously it is not involved in the armed conflict.
Lysenko said the Ukrainian army had retreated from fighting for control of the Luhansk airport. Defense Ministry spokesman Leonid Matyukhin said the Ukrainian forces had been fighting against a Russian tank battalion.
Ukrainian troops killed about 100 pro-Russian rebels in the last 24 hours, Matyukhin said in a video statement on Facebook today. Government troops were shelled three times from the Russian side of the border, according to the statement.
More
Below the state of modern Europe as it readies for
a severe trade war or worse, a shooting
war with nuclear armed Russia.
Eurozone recovery hopes dashed by poor manufacturing data
A surprisingly weak survey of euro area manufacturers points to another difficult quarter for the currency bloc
Hopes of a eurozone recovery in
the third quarter were dashed by a wave of weak manufacturing data, released on
Monday.
Survey data from Markit revealed
that the outlook for euro area manufacturing was at its weakest level for more
than a year, this August.
Rob Dobson, senior economist at
survey compiler Markit, said: “The eurozone manufacturing sector lost further
growth momentum in August."
The headline purchasing managers’ index (PMI) reading for the manufacturing sector dropped from 51.8 to 50.7 in August, weaker than the 50.8 analysts had pencilled in. A number above 50 implies growth.
Mr Dobson said rising tensions in Ukraine and economic uncertainties created by slowing eurozone growth and falling inflation had had a "braking effect".
The headline purchasing managers’ index (PMI) reading for the manufacturing sector dropped from 51.8 to 50.7 in August, weaker than the 50.8 analysts had pencilled in. A number above 50 implies growth.
Mr Dobson said rising tensions in Ukraine and economic uncertainties created by slowing eurozone growth and falling inflation had had a "braking effect".
More
Shock drop in UK manufacturing growth - are the finest days of UK recovery over?
A weaker outlook for the manufacturing sector has led some analysts to suggest that the best days of the UK recovery have now passed
Poor
manufacturing data could signal the end of a hot streak for UK growth.
Surveys of the nation's manufacturing sector saw an unexpected fall this August, as purchasing managers' index (PMI) figures dropped from 54.8 to 52.5.
While still above 50 - suggesting that the sector continues to expand - the data pointed to a fall in the pace of growth.
Surveys of the nation's manufacturing sector saw an unexpected fall this August, as purchasing managers' index (PMI) figures dropped from 54.8 to 52.5.
While still above 50 - suggesting that the sector continues to expand - the data pointed to a fall in the pace of growth.
"While the worst days of the recession are definitely behind us", said Jeremy Cook, of currency firm World First, "PMI surveys also suggests that the finest days of the recovery are too."
The survey pointed to a "broad slowdown" that is underway in the UK's manufacturing sector, according to Markit, who compiled the report.
Manufacturers "were walking rather than running in August as the sector’s performance fell to a 14-month low", said David Noble, of the Chartered Institute of Purchasing & Supply.
Rob
Dobson, senior economist at Markit, said: "It is also becoming
increasingly evident that UK industry is not immune to the impacts of rising
geopolitical and global market uncertainty, especially when they affect
economic growth and business confidence in our largest trading partner the
eurozone."
More
Spectre of 1929 crash looms over FTSE 100 as traders take on record debts
The spectre of the 1929 stock market crash looms large for UK investors as traders borrow record amounts to invest in rising stock markets
Nothing has been learnt from the
madness of the 1929 stock market crash as once again traders reach for record
amounts of debt to pile into rising share prices.
The level of margin debt that
traders are using to buy shares in the stock market reached the highest levels
on record, according the latest data from the New York stock exchange.
US traders borrowed $460bn from
banks and financial institutions to back shares, and once cash and credit
balances held in margin accounts of $278bn is subtracted this left net margin
debt of $182bn in July
Traders are now more exposed to a
fall in share prices than at the height of the dot-com bubble at the turn of
the century, and just before the financial crisis during the 2007 peak.
Buying
shares on margin is often used by hedge fund traders to increase the returns on
their investments. As the stock markets have steadily risen during the past
five years and the level of risk has fallen, banks have become more willing to
lend money for this activity.
----The impact on returns in a rising market is startling. If for example an investor only has to put down 10pc, then with £10 he can buy £100 worth of shares. If by the end of the next day the investment has risen by 10pc to £110, when they sell the shares the returns in absolute amounts would be the original £10 plus a £10 profit, thus generating 100pc return within a day rather than 10pc if they had to put up the whole £100 to buy the shares in the first place.
The problem comes when markets
start falling and investors get the dreaded margin call. Using the same example
if the shares fall to £80 on the first day the investors entire £10 has been
wiped out, plus another £10 of debt he now owes. However, at the end of the day
the broker will only call for an additional £2 to be put into the account. If
at the end of the following day the shares fall further and the investor cuts
their losses, they have to find money to repay their debts
More
Elsewhere China flexes it muscle. If Uncle Scam is
headed into the Steppes of the Ukraine, it’s time for China to become the
regional hegemon of East and Southeast Asia.
Xi’s Hard Line on Hong Kong Shows No Tolerance of Challenges
Sep 2,
2014 3:42 AM GMT
President Xi Jinping’s uncompromising stance on limiting democratic reforms
in Hong Kong
marks a public show of strength that signals to the world - - and China’s own citizens
-- that the ruling Communist Party won’t tolerate any challenges to its
authority. Xi incurred a rebuke from the U.S. government and the anger of pro-democracy campaigners in Hong Kong by insisting China effectively selects which leadership candidates people in the former British colony can vote for. The demands of even the most moderate advocates for greater democracy were rejected on Aug. 31 as they were told to take it or leave it.
“Beijing has been quite obsessed with projecting a strong image to the world that it has a solid grip on power and its decisions mustn’t be challenged,” said He Weifang, a law professor at Peking University. “Sometimes it looks more arrogant than strong, but the central government doesn’t care, because it would rather err on the side of looking strong than weak.”
----Xi has a personal interest in Hong Kong affairs partly because he was the party’s top official in charge of policy for the city and for nearby Macau between 2007 and 2012. His intransigence on the election issue after months of talking with pro-democratic forces in the city left no room for negotiation, a posture that he has been adopting on domestic affairs and on the international stage.
“Xi Jinping is determined that China will keep Hong Kong within its own control,” said Wong Yiu-chung, head of the Department of Political Science at Lingnan University in Hong Kong. “He’s been tough on foreign policy. On the crackdown on corrupt officials he’s tough. And he’s tough on liberals and dissidents.”
More
We end for the day with the soon to be split UK
taking on China as well as Russia. Someone needs to remind Westminster that the
British Empire ended almost 70 years ago. The tiny British Army will not be
returning to Hong Kong or China ever again. With Scotland on the cusp of voting
for independence, time to be short Pounds and long gold.
China calls for Britain to scrap Hong Kong inquiry
Chinese authorities accuse the UK of 'highly inappropriate interference' in the affairs of its former colony
Chinese authorities have demanded Britain drop an inquiry into the progress of democratic reforms in Hong Kong, accusing it of "highly inappropriate" interference in its affairs.The broadcaster said it had seen a letter from China's Foreign Affairs Committee to its British counterpart condemning the probe into the state of democracy since Hong Kong was handed over to Chinese control in 1997.
The report emerged after pro-democracy activists vowed to launch a campaign of civil disobedience over Beijing's weekend decision to vet candidates for the next leadership election in the former British colony.
Critics have called the restrictive framework a betrayal of Beijing's promise to award Hong Kong universal suffrage by 2017.
The letter from the foreign affairs committee said the British probe, announced in July, would be a "highly inappropriate act which constitutes interference in China's internal affairs"
It urged lawmakers to "act with caution on the issue of Hong Kong, bear in mind the larger picture of China-UK relations and Hong Kong's prosperity and stability, stop interfering in Hong Kong's affairs and cancel the inquiry on UK-Hong Kong relations."
The deal that handed Hong Kong back to China guaranteed some freedoms and a semi-autonomous status, and the British foreign secretary reports to parliament on the territory ever six months.
More
Scottish Independence: Yes camp closes the poll gap
The No camp are now just six points ahead, YouGov poll finds
Support for Scottish independence has risen eight points in a month, according to a new poll.The No camp are now six points ahead of the Yes campaign, down from 14 points in mid-August and 22 points early last month, excluding undecided voters.
The latest YouGov poll found that, excluding ''don't knows'', 53% of those questioned planned to vote No, while 47% would back Yes.
This compares to 57% for Yes and 43% for No in mid August and 61% for Yes and 39% for No at the beginning of last month.
Blair Jenkins, Chief Executive of Yes Scotland, said: ''This breakthrough poll shows that Yes has the big momentum - it's an all-time high for Yes support in a YouGov survey so far, and an eight-point swing from No to Yes in just three weeks. We only need another three-point swing to achieve a Yes for Scotland on September 18.
More
"Gold was not selected arbitrarily by governments to be the monetary standard. Gold had developed for many centuries on the free market as the best money; as the commodity providing the most stable and desirable monetary medium."
Murray N. Rothbard
At the Comex silver depositories Friday final figures were: Registered 63.13 Moz,
Eligible 116.16 Moz, Total 179.29 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Not the usual line up today, just more sign that
both sides in the Ukraine conflict are clearing the decks for a prolonged
fight."As fewer and fewer people have confidence in paper as a store of value, the price of gold will continue to rise. The history of fiat money is little more than a register of monetary follies and inflations. Our present age merely affords another entry in this dismal register."
Hans F. Sennholz
Russia to Move $10 Billion Wealth Fund Out of Sanctions' Reach
Sep 1, 2014 2:57 PM GMT
Russia is preparing to
transfer the ownership of a $10 billion sovereign wealth fund to the central
bank from a sanctioned state-development lender, according to two people with
knowledge of the plan. Russian Direct Investment Fund’s co-investors, which include sovereign funds in Europe and Asia, are concerned that sanctions may affect their investments in Russia if the state lender controls the assets, according to one of the people, who asked not to be identified because the information is private.
The fund, created in 2011 to stimulate investments in privately held businesses and wean the state off its dependence on commodities, has secured the backing of funds including France’s Caisse des Depots et Consignations and Japan Bank for International Cooperation and last year hired Goldman Sachs Group Inc. (GS) as an adviser. Penalties over Ukraine have led Russia to invest in state-owned lenders VTB Group and Russian Agricultural Bank, whose access to international funds has been curbed, and the measures may also impede co-investors from dealing with RDIF.
RDIF said a decision on the transfer to the central bank has “not been made,” according to an e-mailed statement. A discussion about “possible separation” started two years ago, the fund also said.
The central bank’s press service in Moscow didn’t respond to calls and an e-mailed request for comment. Ekaterina Grishkovets, a spokeswoman for Vnesheconombank, the state development bank known as VEB, didn’t answer calls or an e-mail seeking comment.
More
http://www.bloomberg.com/news/2014-09-01/russia-said-to-plan-sovereign-fund-move-over-sanctions.html
"Gold would have value if for no other reason than that it enables a citizen to fashion his financial escape from the state."
William F. Rickenbacker
The monthly Coppock Indicators finished Aug.
DJIA: +152 Down. NASDAQ: +312 Down. SP500: +231 Down.
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