Baltic Dry Index. 1063 +01
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
"When it becomes serious, you have to lie"
Jean-Claude Juncker. Ex-Luxembourg Prime Minister and ex-president of the Euro Group of Finance Ministers. Confessed liar. EC President.
We open today with the dying sideshow of continental
Europe. The EUSSR is predictably going the way of the dead USSR. With the
Ukraine civil war heating up again and winter approaching, we await Russia’s
counter to the last round of EU sanctions with interest.
Below, Europe on the cusp of recession, as commodities
signal trouble dead ahead. But this is as nothing compared to getting the Hong
Kong crisis wrong.
"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
Europe Ticking All the Wrong Boxes Starts Mirroring Japan
Sep 30, 2014 10:42 AM GMT
Similarities between the euro region and Japan are intensifying, heaping
pressure on Mario Draghi while offering good news for bond holders. Sluggish credit growth? Check. Slowing economy? Check. Falling market expectations for inflation? Check. Aging population? Yes, it has that too, placing Europe in a similar situation to what was encountered by the world’s third-largest economy after the bubble burst on its postwar Economic Miracle.
That’s a concern for DZ Bank AG, the most bullish forecaster of German bunds in data compiled by Bloomberg. It estimates the 10-year yields will fall to a euro-era record of 0.5 percent by the first quarter, leaving them below the 0.65 percent median estimate for their Japanese peers.
With the official interest rate near zero, European Central Bank President Draghi may need to do more to steer the region away from the deflation and debt traps that condemned Japan to two decades of stagnation.
----Euro-area growth stagnated in the second quarter and data today showed inflation slowed to 0.3 percent this month, a fraction of the ECB’s goal of just under 2 percent. The central bank’s preferred measure of medium-term inflation expectations is near a four-year low.
Although declining costs for everything from transport and food to clothes can be good news for consumers, disinflation -- or slowing inflation -- makes it harder for borrowers to pay off debts and for businesses to boost profits. Under deflation, or falling prices, households may postpone purchases and companies may delay investment and hiring as demand for their products dries up.
“The euro region is at this very moment in a quite similar situation as Japan although certain dynamics may be different,” saidHendrik Lodde, a strategist at Frankfurt-based DZ Bank. “While we don’t expect outright deflation for the euro zone, the economy is likely to continue to face some strong headwinds.”
More
Military failures stall German response to Ebola and Isil
Broken planes and reduced spending has left Germany's plans to help in the fight against Ebola and the Islamic State in trouble
By Justin Huggler, Berlin 1:07PM
BST 30 Sep 2014
The German military has been left
red-faced after the third high-profile aircraft breakdown in as many weeks left
medical supplies for the fight against Ebola in Africa stranded in the Canary
Islands.
The debacle is the latest
embarrassment for Germany after a series of aircraft failures left its €70m
shipment of arms to Kurds fighting against Islamic State in Iraq in disarray
last week.
It comes just days after the
German defence minister, Ursula von der Leyen, admitted the country’s military
is facing equipment shortages so severe it cannot meet its Nato commitments.
Ms von der Leyen, seen by many in
Germany as Angela Merkel’s heir apparent, has led calls for the country’s armed
forces to take up a greater international role, and championed its involvement
in the fight against Islamic State and Ebola.
But the mission to arm the Kurds
got off to a disastrous start when a military transport plane carrying a team
of instructors to northern Iraq suffered a malfunction, stranding the
instructors in Bulgaria for several days.
Germany
had to borrow a Dutch aircraft to fly the weapons to Iraq because its own air
force didn’t have one available - only for the situation to descend into farce
as the Dutch plane broke down as well.
More
http://www.telegraph.co.uk/news/worldnews/europe/germany/11130506/Military-failures-stall-German-response-to-Ebola-and-Isil.html
Dollar surge triggers oil rout as Brent crude tumbles
North sea oil trading below $95 per barrel as the US dollar hitting a four-year high hits demand
Oil prices tumbled Tuesday as the
US dollar hit a new four-year high on the back of the strength of the world’s
largest economy and bets that the Federal Reserve will tighten monetary policy
at a faster pace than originally expected.
Brent crude – a global benchmark
of oil from 15 fields in the North Sea – fell below its $95 per barrel
resistance level as the dollar surged against a basket of global currencies.
Because major commodities such as oil are priced in dollars, when the dollar
strengthens it makes these resources more expensive for buyers holding other
currencies, which suppresses demand.
However, concerns over the
weakening Chinese economy as Beijing grapples with how to rein in
demonstrations in Hong Kong are also at the forefront of concerns worrying
investors.
“A glut of supply and muted
demand against a backdrop of decelerating growth in China and a more
self-sufficient US have contributed to price weakness across the commodity
complex,” said Jade Fu, Investment Manager at Heartwood Investment Management.
“Even heightened geopolitical unrest in various parts of the world this year
has failed to trigger a sustained rally in commodity prices.”
More
In China on China’s National Day, the Hong Kong problem
grows. Mishandled by Beijing, Hong Kong, London or Washington, and this crisis can
turn into a black swan super-fast. With London an irrelevant paper tiger, has China just turned Washington into a paper
tiger too? Stay long fully paid up physical gold and silver, what happens next
has big implications for China, the USA and the EU. Needing to borrow 8
trillion dollars a year to survive, Washington has reached an awkward
crossroads. My guess is that President Obama will dump Hong Kong and the War
Party’s latest reckless blunder.
Democracy is beautiful in theory; in practice it is a fallacy.
Benito Mussolini.
Hong Kong Leader Leung Jeered by Democracy Protesters
Oct 1, 2014 6:35 AM GMT
Hong Kong’s Chief
Executive Leung Chun-ying was jeered by pro-democracy demonstrators at a
ceremony to hoist the Chinese flag as the city entered the sixth day of
protests seeking free elections. Leung arrived by boat at Golden Bauhinia Square to mark the 65th anniversary of the founding of the People’s Republic of China, and he sang China’s national anthem as the Chinese and Hong Kong flags were hoisted. Leung defended China’s plan to allow the city’s first election for chief executive in 2017, even if the candidates for the post must be vetted first.
“It’s understandable that different people have different ideal proposals for political reforms,” Leung said at the ceremony. “But having universal suffrage is better than not having it. Five million people being able to pick the chief executive through one-man-one-vote must be better than the 1,200-member election committee” under the current system.
After the flag raising, Leung and other dignitaries drank
champagne on a red stage in a reception hall festooned with Chinese and Hong
Kong flags as a white-coated band played patriotic tunes. Hundreds of
protesters faced police outside the ceremony, booing the chief executive and
calling for fully-free elections.
More
Russian state television says Britain and US provoked Hong Kong protests
Accusations from pro-Kremlin media reflect Russia’s growing ties with China after US and EU sanctions
Russian state television has
claimed the pro-democracy protests in Hong Kong
are being organised by Britain and the United States.
In a sign of the Kremlin’s deep
antipathy for popular street protest and growing anti-Western sentiment in
Russian society, the Rossiya 24 channel regurgitated Chinese reports suggesting
that leaders of the Occupy Central movement “underwent special training with
the American secret services”.
“The tactics of the protesters
exactly replicates the beginning of the ‘orange revolutions’, that were in fact
coups,” the channel said, referring to the mass demonstrations that ousted
governments in Georgia, Ukraine and Kyrgyzstan during the 2000s.
“What’s more,” Rossiya 24
continued in a broadcast shown on Tuesday and published online, “experts
believe that Great Britain stands behind the protests in Hong Kong because it
is losing economic benefits that its companies had after the handover of the
colony to China.”
It is true that Chinese media
have accused the protesters of having ties to the US government. Wen Wei Po, a
pro-Beijing newspaper, said last week that Joshua Wong, the 17-year-old Hong
Kong student leader, had met frequently with US embassy personnel in Hong Kong
and received donations from Americans. He denies the allegations.
----Beijing-leaning media have also accused the CIA of infiltrating schools in Hong Kong and claimed Britain has planted intelligence agents in the city’s government, judiciary and chambers of commerce.
Russia has been drawing closer to
China as Moscow faces biting sanctions from the United States and the European
Union over the Ukraine crisis.
Earlier this month, Rostec, the
sanctions-hit Russian state tech company, signed a $10bn (GBP3.7bn) deal with a
Chinese coal producer to develop deposits in Siberia and the Russian Far East.
A week earlier, Vladimir Putin, Russia’s president, offered China a stake in
Vankor, the country’s second-biggest oil project, which is situated in eastern
Siberia.
Other Kremlin-leaning media are
rolling into action to shore up Beijing and cast doubt on the origins of the
Hong Kong protests.
Komsomolskaya Pravda, one of
Russia’s biggest tabloids, said on Tuesday that the “western champions of
democracy are supporting the insurgents in unison”. The paper cited the
“odious” US state department spokesperson, Marie Harf, as an example.
More
U.S. taking caution in response: Hong Kong protest
Matt Spetalnick, REUTERS Updated:
WASHINGTON- The United States is
carefully calibrating its response to pro-democracy demonstrations in Hong
Kong, showing support for peaceful protests while signaling it has little
interest in seeing the situation escalate and risk a harsher crackdown by
Chinese authorities.
Saying it was closely monitoring
the political unrest unfolding on the streets of Hong Kong, the White House on
Monday urged security forces there to "exercise restraint" and also
called on protesters to "express their views peacefully."
But it could be a tricky
balancing act for Washington, especially given Beijing's transformation into a
global economic powerhouse and given how inter-dependent the U.S. and Chinese
economies have become since the Tiananmen Square crackdown 25 years ago.
----Weighing in cautiously, White House spokesman Josh Earnest told reporters "the United States supports universal suffrage in Hong Kong in accordance with the basic law" but avoided public condemnation of the Chinese government.
He did, however, express concern
about reports that websites were being blocked or censored over accounts of the
protests.
Privately, one U.S. official said
there had been "some excess" by Chinese security forces who used
teargas and batons over the weekend against protesters who had been
demonstrating peacefully.
Morehttp://www.torontosun.com/2014/09/29/us-taking-caution-in-response-hong-kong-protest
U.K. Calls In Chinese Ambassador Over Hong Kong Protests
Sep 30,
2014 5:51 PM GMT
The U.K. government summoned China’s ambassador to express support for
pro-democracy protesters in Hong Kong who are demanding free and open elections in the
former British territory. U.K. Deputy Prime Minister Nick Clegg told Sky News television he intends to tell the envoy, Liu Xiaoming, of his “dismay and alarm at the way in which the Chinese authorities in Beijing seem determined to refuse to give to the people of Hong Kong what they are perfectly entitled to expect.”
Hong Kong, which the U.K. handed back to China in 1997, is experiencing waves of demonstrations over its future governance. After weekend clashes with riot police who used tear gas to disperse crowds, student leaders said today the protests would spread unless China meets their demands for Chief Executive Leung Chun-ying to resign and for the government in Beijing to drop plans to control the territory’s 2017 leadership election.
Clegg’s move steps up British backing for the protesters after Prime Minister David Cameron called on China earlier today to honor a 1984 bilateral agreement under which Hong Kong was intended to move to universal suffrage in 2017.
More
We end for the start of October, with bad news for
travellers to the USA. With a well-developed, state of the art medical infrastructure,
the USA should have little trouble in dealing with both developments. Still,
with flu season arriving, it might be time to ask is my travel really
necessary. Do I really have an extra 21 days to spare in an isolation tent?
First Ebola Case Is Diagnosed in the U.S., CDC Reports
Oct 1,
2014 5:01 AM GMT
The first case of deadly Ebola
diagnosed in the U.S. has been confirmed in Dallas, in a man
who traveled from Liberia and arrived in the U.S. on Sept. 20, the Centers for
Disease Control and Prevention said. The man is being kept in isolation in an intensive care unit. He had no symptoms when he left Liberia, then began to show signs of the disease on Sept. 24, the CDC said yesterday. He sought medical care on Sept. 26, was hospitalized two days later at Texas Health Presbyterian and is critically ill, said Thomas Frieden, director of the CDC.
Frieden said the agency is working to identify anybody who
had contact with the man and track them down. “There is no doubt in my mind
that we will stop it here,” he said at a press conference in Atlanta.
More
How the Experts Find and Stop Ebola
September 30, 2014
----The
Centers for Disease Control and Prevention are doing everything in their power
to stop the spread of the virus. But just how do they attempt to prevent an
Ebola outbreak? The video above provides a step-by-step explanation.
CDC detectives have used a method
known as contact tracing in West Africa. In the fight against the virus,
the government agency calls it "the key to stopping the outbreak and
saving lives."
Contact tracing means finding
everyone who comes in direct contact with a sick Ebola patient. They ask the
infected patient and family members to list everyone that patient has
interacted with. Monitors then quarantine those contacts over the next 21 days
to check for symptoms of Ebola.
"If a contact begins to show
symptoms of Ebola, he is immediately isolated, tested, and provided care,"
the video explains.
It's a process that takes weeks,
and the process needs to be repeated until no new patients appear with
symptoms.
More
Mosquito Virus That Walloped Caribbean Spreads in U.S.
Oct 1, 2014 5:01 AM GMT
A mosquito-borne virus that can cause debilitating joint pain lasting for
years has spread to the continental U.S. after infecting hundreds of thousands of people in the Caribbean and
Central America. The virus is called Chikungunya, an African name meaning “to become contorted.” While the illness, first identified in Tanzania in 1952, has long bedeviled Africa and Asia, the only recorded cases in the U.S. before July involved patients who contracted the virus abroad.
Now, 11 cases have been confirmed as originating in Florida, spurring concern this may be the beginning of the type of explosive growth seen elsewhere from a disease that has no vaccine or cure. Medical and environmental experts are debating how best to quell the outbreak before it takes off.
----Patients who contract Chikungunya have joint swelling and pain, fever, headache and rash for about a week, though some symptoms last months or years in some patients, according to the U.S. Centers for Disease Control and Prevention.
While the disease generally isn’t fatal, more than 100 people have died in the Western Hemisphere since December, according to the Pan American Health Organization. Treatment includes hydration, rest and medicine that reduces fever or pain such ibuprofen or acetaminophen.
More
Yes, gold doesn’t bear interest. Many,
including Warren Buffett, belittle its investment value. But, paintings or
antiques don’t bear interest either. When money supply is rising, anything
scarce tends to rise in value. Gold is the best scarce commodity in the world.
Andy Xie.
At the Comex silver depositories Tuesday final figures were: Registered 65.59 Moz,
Eligible 116.60 Moz, Total 182.19 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today more on our new lawless age of central
bankster funded casino capitalism. Below, a genuine error or an attempt to rig the Japanese stock
market?
It’s morally wrong to let a sucker keep his money.
Yakuza Squid.
Oops! Possible $617 Billion Trading Error in Japan
Oct 1,
2014 5:38 AM GMT
Stock orders amounting to more than the size of Sweden’s economy
were canceled in Japan
today, in what could have turned into one of the biggest trading errors of all
time. At 9:25 a.m. Tokyo time, orders for shares in 42 companies totaling 67.78 trillion yen ($617 billion) were canceled, according to data compiled by Bloomberg from the Japan Securities Dealers Association. A representative at the organization wasn’t immediately available to comment.
The biggest order was for 1.96 billion shares of Toyota Motor Corp. (7203), or 57 percent of outstanding shares at the world’s biggest carmaker, for 12.68 trillion yen through an off-exchange transaction. Toyota declined to comment. Other stocks with scrapped transactions included Honda Motor Co. (7267), Canon Inc., Sony Corp. and Nomura Holdings Inc. (8604)
“Fat finger” trading mistakes occur periodically. In 2009, UBS AG mistakenly ordered 3 trillion yen of Capcom Co. convertible bonds. Still, today’s scrapped trades were of a different magnitude.
“I’ve never heard of orders this big being canceled before,” said Ayako Sera, a Tokyo-based market strategist at Sumitomo Mitsui Trust Bank Ltd., which oversees about $474 billion in assets. “There must have been an error.”
While no harm’s been done because the orders were canceled, there should be an explanation to alleviate concerns, Sera said.
The Nikkei 225 Stock Average was little changed at 1:03 p.m. Tokyo time and shares of Toyota were up 1.2 percent as the yen weakened.
“It’s not rocket science that there was a fat finger here, but it reopens the question about accountability,” said Gavin Parry, managing director at Hong Kong-based brokerage Parry International Trading Ltd.
More
"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
The monthly Coppock Indicators finished September.
DJIA: +141 Down. NASDAQ: +289 Down. SP500: +216 Down.
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