Thursday, 18 September 2014

V-Day.



Baltic Dry Index. 1124  -26 

LIR Gold Target in 2019: $30,000.  Revised due to QE programs.

Hark, when the night is falling
Hear, hear the pipes are calling
Loudly and proudly calling down through the glen
There where the hills are sleeping
now feel the blood a leaping
high as the spirits of the old highland men

Scotland The Brave Lyrics

V-Day has finally arrived north of the border in the land of my birth, Old Socialist, wealth envy, Skintland, err Scotland. Voting starts in about 30 minutes. Will my fellow Scots today get to shoot themselves in the head or the foot? I have no idea either, though the polls suggest that the No vote wins, and the Union limps on with the Scots chained like an iron ball onto the ankle of the English, who after the acrimonious campaign are not best pleased nor inclined to buy scotch beef and haggis. That would be the shot into their foot.

The head shot is a vote to ditch the English, Welsh and Northern Irish, though not all the hidden subsidies, those all too canny for their own good Scots get now from the other three.  Stay tuned for tomorrow’s exciting outcome. The next Scotland v England football game in Scotland in dull, drab, November, looks to be one of the All Time Greats. But will the Scots cheat and field some Faeroese? It might be best to host it somewhere neutral, like Catalonia in the sun.

Unable to do justice in words to the lead up to the polls opening, the Great Fight, and the days ending taking place north of the border today, I’ll let Boccherini sum it up for me.

Mons Graupius, The Battle for Scotland, September 18, 2014. Best with headphones.
https://www.youtube.com/watch?v=rs9Rmrn2mWc


10.00 AM Update:



Has the prospect Scottish Independence Forced Nessie to Emigrate?

Could this be an image of the Loch Ness monster?

Published on Sep 12, 2014 7:18 AM
 LONDON - A photographer has captured an image of what she believes to be a creature from the deep.

Ellie Williams took the shots while taking pictures in the Lake District of Windermere, which is located 241km from Scotland’s Loch Ness area. 

Loch Ness is best known for alleged sightings of the cryptozoological Loch Ness Monster, also known affectionately as "Nessie". 
More
 

A day of destiny for our United Kingdom

Whatever the outcome of the Scottish independence referendum, Britain will never be the same again

Article 1 of the Acts of Union reads as follows: “That the two Kingdoms of Scotland and England shall upon the first day of May, 1707, and for ever after, be united into One Kingdom by the name of Great Britain; And that the Ensigns Armorial of the said United Kingdom be such as Her Majesty shall appoint and the Crosses of St Andrew and St George be conjoined in such manner as Her Majesty shall think fit and used in all Flags Banners Standards and Ensigns both at Sea and Land.”

This alliance, in other words, was supposed to be inviolable. Yet today, what is arguably the world’s most successful constitutional partnership faces the very real prospect of dissolution. Unless the pollsters have made a complete mess of things (and given the difficulties of surveying opinion in a referendum, this cannot be ruled out) the result of the independence referendum is on a knife-edge.
More
http://www.telegraph.co.uk/news/uknews/scotland/11102124/A-day-of-destiny-for-ourUnited-Kingdom.html

Scotland faces 'decade of economic decline' if it votes yes

A majority of investors surveyed believe that a break-up would be beneficial to the rest of the UK

The City has issued its final plea to Scottish voters ahead of the referendum, warning that a vote for independence from the UK would trigger a decade of economic decline north of the border.

A poll of leading institutional investors has shown that 63pc believe Scotland’s economy is likely to be weaker for at least 10 years if the country breaks away from the rest of Britain. Just 3pc think that an independent Scotland would have a stronger economy one year after secession.

The survey by Capital Spreads, the spread-betting firm, is among the biggest produced, canvassing the thoughts of more than 200 fund managers in Britain, who collectively oversee more than $10 trillion (£6.1 trillion) of assets. Business has come out strongly in favour of keeping the UK whole during the campaign, prompting nationalists such as Jim Sillars to threaten a “day of reckoning” should the Yes vote succeed in breaking the 300-year-old economic and political union.
More
http://www.telegraph.co.uk/finance/economics/11103114/Scotland-faces-decade-of-economic-decline-if-it-votes-yes.html

While the UK and EUSSR wait in trepidation, elsewhere the Fed’s talking chair spoke. The sofa and carpet listened. The sky falls next year with the end of ZIRP the furniture intoned. America’s banksters and Great Vampire Squids aren’t so sure. They seem to be setting up their Muppets for a fall later this year.

In central banking as in diplomacy, style, conservative tailoring, and an easy association with the affluent count greatly and results far much less.

J. K. Galbraith.

Fed Keeps ‘Considerable Time’ Pledge as Growth ‘Moderate’

Sep 17, 2014 11:29 PM GMT
The Federal Reserve stuck to its pledge to keep interest rates near zero for a “considerable time” after it stops buying assets, even as it outlined a strategy to exit from six years of unprecedented easing.

“The labor market has yet to fully recover,” Fed Chair Janet Yellen said at a press conference today after a meeting of the Federal Open Market Committee in Washington. “There are still too many people who want jobs but can’t find them.”

Yellen added that “inflation has been running below the committee’s 2 percent objective,” a contrast to the panel’s July statement that it was “somewhat closer” to its goal.

Treasuries declined and stocks gave up early gains as investors focused on an increase in Fed officials’ interest-rate projections for next year. Officials raised their median estimate for the benchmark federal funds rate, expressed as dots on a chart, to 1.375 percent at the end of 2015, compared with a June forecast of 1.125 percent.

“Yellen wants to leave the impression there’s no rush to hike, but at the same time if you look at the 2015 dots they’re above what they were before and that implies some normalization next year,” Thomas Costerg, an economist at Standard Chartered Plc in New York.
More
http://www.bloomberg.com/news/2014-09-17/fed-keeps-considerable-time-pledge-as-growth-is-moderate-.html

Fed Officials Predict Fed Funds Rate to Rise to 1.375% End-2015

Sep 17, 2014 7:00 PM GMT
Federal Reserve officials raised their median estimate for the federal funds rate at the end of 2015 to 1.375 percent, compared with 1.125 percent in June.

The rate will be at 3.75 percent at the end of 2017, the Fed said today for the first time as it included that year in its Summary of Economic Projections. That is the same as Fed officials’ longer-run estimate. The median estimate in June for the long-run fed funds rate was also 3.75 percent.
More
http://www.bloomberg.com/news/2014-09-17/fed-officials-predict-fed-funds-rate-to-rise-to-1-375-end-2015.html

Dot plot shows Fed will be quick about raising rates, once it starts

September 17, 2014, 4:48 PM ET
Once the Federal Reserve begins raising rates, it’s likely to raise interest rates at nearly every meeting of the Federal Open Market Committee for two years, according to the dot plot released by the Fed today.

The federal funds rate is now between 0% and 0.25% and is likely to remain there for a “considerable time,” the Fed said Wednesday. But by the end of 2017, the majority of the committee expects the fed funds rate to rise to around 3.75%.

The Fed usually raises rates in quarter-point moves. That means the end game of 3.75% is 13 rate hikes away.
More
http://blogs.marketwatch.com/capitolreport/2014/09/17/dot-plot-shows-fed-will-be-quick-about-raising-rates-once-it-starts/

CEOs Darken Outlook, Slash Hiring and Cap-Ex Plans – Hope Now Focused on Share Buybacks (which just Plunged)


Wolf Richter   www.wolfstreet.com   www.amazon.com/author/wolfrichter
The word “gloomier” inconveniently showed up in a Reuters headline that described how the CEOs of the Business Roundtable – one of the thermometers into the brains of corporate America – felt about sales, employment, and capital expenditures. Yet, “gloomier” or not, these CEOs run companies that have been spending near record amounts, not on productive uses such as capital expenditures or hiring more people to push revenues to the next level, but on buying back their own shares.

The Business Roundtable is an association of CEOs of the largest corporations in the US that account for “more than a third of the total value of the US stock market,” according to its website. On its agenda: lower corporate taxes (tax credits!), more immigration of cheap labor, and trade – the big trade agreements currently being negotiated in all secrecy [my take from late last year, though resistance has grown since.... Coming Soon: Corporate Tools To Hollow Out National Sovereignty].

Or, as it says so eloquently, “working to promote sound public policy and a thriving US economy.”

But the BRT results didn’t speak of a thriving US economy. “CEO plans for investment, hiring and sales over the next six months decreased, with employment plans declining the most,” the survey stated. It wasn’t pretty:
  • The least bad was the sales index, which dropped 4.5 points to 116.4, with 20% of the CEOs expecting sales to stagnate and with 7% expecting sales declines.
  • Capital expenditures looked worse. They would increase at only 39% of the companies, down from 44% in the prior quarter; they’d stagnate at 51% of the companies, up from 41% in Q2; and they’d get slashed at 10% of the companies, up from 8%. It dragged the cap-ex index down by 6.8 points to 79.1.
  • And US employment? Only 34% expected to increase employment in the US, down sharply from 43% in Q2; but 20% would slash payrolls, up from 14% in Q2. And the sub-index plunged 15.7 points to 63.5.
More
http://www.zerohedge.com/news/2014-09-17/ceos-darken-outlook-slash-hiring-and-cap-ex-plans-%E2%80%93-hope-now-focused-share-buybacks-

Back in the real world, potential bad news for the EUSSR. A cold winter lies ahead for the dead in the water, dying EUSSR. Just the time to pick a suicidal trade war with their major, lowest cost, energy supplier then. In China, the Great Wobble grows.

“It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."

J. K. Galbraith. The Great Crash: 1929.

Weather forecasts predict colder winter in Europe this year

Non-political September 17, 1:00 UTC+4
“Frequent invasions of cold air with short warm spells are expected,” said Rosgidromet head, Roman Vilfand
MOSCOW, September 16. /ITAR-TASS/. The upcoming winter in European is expected to be colder than the 2012-2013 winter, Russian federal hydrometeorology and environmental monitoring service (Rosgidromet) said on Tuesday.
“Frequent invasions of cold air with short warm spells are expected,” said Rosgidromet head, Roman Vilfand.

He said that last year’s stable cyclonic weather in the Arctic had ensured the influx of warm air from the Atlantic Ocean. Forecasts for the coming winter say that cyclones in the Arctic will be followed by anticyclones that will “pump” icy wind from the Barents and Kara Seas to Western Europe. The coldest weather is expected in February when air temperatures may drop much below average.

Winter will be also cold in European Russia, in Belarus and Ukraine.

According to Rosgidromet forecasts, the weather in western Ukraine will be colder than usual in November. 
Colder weather is also forecasted in the Caucasian republics. February will be the coldest winter month.
http://en.itar-tass.com/non-political/749856

China Home Price Drop Spreads to More Cities as Demand Weak

Sep 18, 2014 4:04 AM GMT
China’s new-home prices fell in all but two cities monitored by the government last month as tight credit damped demand even as local home-purchase restrictions were eased.

Prices dropped in 68 of the 70 cities in August from July, including in Beijing and Shanghai, the National Bureau of Statistics said in a statement today, the most since January 2011 when the government changed the way it compiles the data.

Home sales slumped 11 percent in the first eight months of this year amid an economic slowdown after banks tightened property lending to curb default risks. While 37 of the 46 cities that imposed limits on home ownership since 2010 have removed or eased such restrictions as of Sept. 3 to stem the decline in sales, a wait-and-see attitude is still prevalent among homebuyers, according to Centaline Group, parent of the nation’s biggest property agency.

“The policy easings only increased the number of people qualified to buy, but the number of those with the ability to didn’t rise noticeably” as mortgages remain tight, Donald Yu, a Shenzhen-based analyst at Guotai Junan Securities Co., said by phone. “There’s still room for prices to go down further.”

Private data also point to continued price declines. The average new-home price fell 0.59 percent in August from July, the fourth consecutive month of declines, according to SouFun Holdings Ltd., the nation’s biggest real estate website that tracks 100 cities.
More
http://www.bloomberg.com/news/2014-09-18/china-home-price-drop-spreads-to-more-cities-as-demand-weak.html

"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

At the Comex silver depositories Wednesday final figures were: Registered 64.89 Moz, Eligible 116.29 Moz, Total 181.18 Moz.  

Crooks and Scoundrels Corner

The bent, the seriously bent, and the totally doubled over.

In Asia, far from any interest in events in remote, rainy, rowdy, Bonnie Scotland, two giant nations with over a third of the planet’s population are exploring ways to make the 21st century the Asian century of prosperity and renewal. Europe’s downwardly mobile serfs can only look on in envy. Whatever happened to PNAC? Squandered in the sands of Mesopotamia?

"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

Xi calls for building Asian century of prosperity, renewal

NEW DELHI, Sept. 17 (Xinhua) -- Chinese President Xi Jinping on Wednesday urged China and India to join hands to build an Asian century of prosperity and renewal.

"I am confident that as long as China and India work together, the Asian century of prosperity and renewal will surely arrive at an early date," Xi said in a signed article published Wednesday ahead of his state visit to India.

Noting that the relations between China and India have made significant progress in the new century, Xi said the strategic and cooperative partnership for peace and prosperity has been established between the two countries.

China has become India's largest trading partner, with their bilateral trade volume increasing from less than 3 billion U.S. dollars early this century to nearly 70 billion dollars, he said, adding that mutual visits reached 820,000 last year.

"We have had close coordination and cooperation on climate change, food security, energy security and other global issues and upheld the common interests of our two countries as well as the developing world as a whole," Xi said, hailing that China-India relations have become one of the most dynamic and promising bilateral relations in the 21st century.

Xi pointed out that both China and India are now in a crucial stage of reform and development. The Chinese people are committed to realizing the Chinese dream of great national renewal, while the Indian people are endeavoring to achieve their development targets for the new era, he said.

"China and India are both faced with historic opportunities, and our respective dreams of national renewal are very much aligned with each other. We need to connect our development strategies more closely and jointly pursue our common dream of national strength and prosperity," said the Chinese president, making a three-point proposal to further boost bilateral relations.

Firstly, China and India need to become closer development partners who draw upon each other's strengths and work together for common development, Xi said.

The combination of the "world's factory" and the "world's back-office" will produce the most competitive production base and the most attractive consumer market, he added.

Secondly, Xi said China and India need to become cooperation partners spearheading growth as two engines of the Asian economy.

"I believe that the combination of China's energy plus India's wisdom will release massive potential," said the Chinese president, calling on both sides to jointly develop the Bangladesh-China-India-Myanmar Economic Corridor, discuss the initiatives of the Silk Road Economic Belt and the 21st Century Maritime Silk Road, and lead the sustainable growth of the Asian economy.

Thirdly, China and India need to become global partners with strategic coordination, as two important forces in a world that moves towards multi-polarity, Xi said.

Noting that both China and India cherish peace, equity and justice, the president stressed that the two countries should carry forward the Five Principles of Peaceful Coexistence, make the international order more fair and reasonable, and improve the mechanism and rules of international governance, so as to make them better respond to the trend of the times and meet the common needs of the international community.

Quoting the late Chinese leader Deng Xiaoping's saying that no genuine Asian century would come without the development of China, India and other developing countries, Xi said China and India are ready to shoulder this mission and work actively to enhance friendship between the two countries.

"I look forward to an in-depth exchange of views with Indian leaders on our bilateral relations during the visit, and to injecting new vitality into our strategic and cooperative partnership for peace and prosperity," he said.

Xi is due to arrive in India late Wednesday for a state visit, the final leg of his ongoing four-country Asia trip, which has already taken him to Tajikistan, the Maldives and Sri Lanka.

http://news.xinhuanet.com/english/china/2014-09/17/c_133650103.htm

"Until government administrators can so identify the interests of government with those of the people and refrain from defrauding the masses through the device of currency depreciation for the sake of remaining in office, the wiser ones will prefer to keep as much of their wealth in the most stable and marketable forms possible - forms which only the precious metals provide."

Elgin Groseclose

The monthly Coppock Indicators finished Aug.

DJIA: +152 Down. NASDAQ: +312 Down. SP500: +231 Down.  

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