Tuesday, 24 March 2015

Grexident Underway?



Baltic Dry Index. 594 +03     Brent Crude 55.50

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

A permanent Governor of the Bank of England (ECB, The FED,) would be one of the greatest men in England (your nation here.)  He would be a little 'monarch' in the City; he would be far greater than the 'Lord Mayor.' He would be the personal embodiment of the Bank of England; he would be constantly clothed with an almost indefinite prestige. Everybody in business would bow down before him and try to stand well with him, for he might in a panic be able to save almost anyone he liked, and to ruin almost anyone he liked. A day might come when his favour might mean prosperity, and his distrust might mean ruin. A position with so much real power and so much apparent dignity would be intensely coveted.

Walter Bagehot, with apologies to Greece.

We open this morning with China. Officially the economy here is still growing, albeit at only 6.8 percent. No one believes that of course, least of all anyone in China. Today’s figures and news suggest that China’s economy isn’t growing at all. If China has stopped growing, and with the EUSSR all but in an official recession, the Great Commodity Boom will now become the Great Commodity Bust. The Great central bankster fuelled Disconnect between stock markets and reality, will end in 2015 in a great stock market crash. It’s all over for Greece.

Below today’s news from China.

Chinese Factory Gauge Slumps as Slowdown Has Li on Standby

1:45 AM GMT  March 24, 2015
(Bloomberg) -- A Chinese manufacturing gauge fell to an 11-month low in March, suggesting more stimulus may be needed to bolster factories in the world’s second-largest economy.

The preliminary Purchasing Managers’ Index from HSBC Holdings Plc and Markit Economics was at 49.2, missing the median estimate of 50.5 in a Bloomberg survey and down from February’s 50.7. Numbers below 50 indicate contraction.

The first reading of momentum in March adds to concerns of a deeper downturn after industrial output, investment and retail sales growth missed analysts’ estimates in January and February. Premier Li Keqiang this month pledged to take action if needed to shore up growth.

“Activity growth slowed in the first quarter,” said Tim Condon, head of Asia research at ING Groep NV in Singapore. “If the official PMI also slides, it will reinforce that further policy stimulus will be needed to hit the 7 percent GDP growth target.”
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Beijing to Close All Major Coal Power Plants to Curb Pollution

3:52 AM GMT  March 24, 2015
(Bloomberg) -- Beijing, where pollution averaged more than twice China’s national standard last year, will close the last of its four major coal-fired power plants next year.

China’s capital city will close China Huaneng Group Corp.’ 845 megawatt power plant next year, after last week closing plants owned by Guohua Electric Power Corp. and Beijing Energy Investment Holding Co., according to a statement Monday on the website of the city’s economic planning agency. A fourth major power plant, owned by China Datang Corp., was shut last year.

The plants will be replaced by four gas-fired stations with capacity to supply 2.6 times more electricity than the coal plants. Once complete, the city’s power and its central heating will be entirely generated by clean energy, according to the Municipal Commission of Development and Reform.

Air pollution has attracted more public attention in the past few years as heavy smog envelops swathes of the nation including Beijing and Shanghai. About 90 percent of the 161 cities whose air quality was monitored in 2014 failed to meet official standards, according to a report by China’s National Bureau of Statistics earlier this month.
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In other commodities news, oil was under renewed pressure even before the latest news from China.

Oil drops as Saudi output nears record, China demand worries drag

By Henning Gloystein SINGAPORE Tue Mar 24, 2015 1:37am EDT
----The PMI drop in China followed an overnight report that Saudi Arabia, OPEC's biggest producer, was now pumping around 10 million barrels of crude oil per day, a near all-time high and some 350,000 bpd above the figure Saudi Arabia gave to OPEC for its February output.

"The market was under pressure early in the trading day after comments from Saudi Arabia that it was producing almost 10 million barrels per day," ANZ bank said on Tuesday.

Brent crude oil futures LCOc1 were trading down 42 cents at $55.50 a barrel at 1.25 a.m. ET. U.S. WTI crude CLc1 dropped 57 cents to $46.88 a barrel.
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At the Comex silver depositories Monday final figures were: Registered 70.02 Moz, Eligible 104.79 Moz, Total 174.81 Moz.  

Crooks and Scoundrels Corner

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

We end for today with Greece getting rushed to the door marked “Exit” by Germany and the ECB. Tsipras brings up the war in Berlin. From London it all looks like a slow motion Grexident.

ECB hits out at Greek 'blackmail' claims as Merkel holds steady in bail-out demands

Mario Draghi denies asphyxiating the cash-strapped government after Greek PM repeats Nazi reparations demands in Berlin

9:00PM GMT 23 Mar 2015
The European Central Bank has hit back at claims it is “blackmailing” Greece over its protracted bail-out, as the impasse between Athens and its international creditors showed no sign of easing on Monday.

In his first formal talks with Germany since taking office, Greek Prime Minister Alexis Tsipras put on a show of solidarity with counterpart Angela Merkel, promising to “avoid division and find a common solution” with his European partners after weeks of acrimonious mud-slinging between the two sides.

But in a letter sent to Ms Merkel and ECB chief Mario Draghi in anticipation of the talks, the Greek premier chastised the central bank for making it “impossible” for his government to meet its basic obligations to pay wages and pensions.

"I am urging you not to allow a small cash flow issue, and a certain ‘institutional inertia’, to turn into a large problem for Greece and for Europe,” wrote a pleading Mr Tsipras.

The ECB has tightened the squeeze on the Leftist government since it came to power in January.
Greek banks are being kept afloat through an expensive form of emergency assistance (ELA) after the ECB removed its ordinary lending operations to the country.

But Mr Draghi shot back at claims the institution was acting unilaterally, claiming any accusations of blackmail were “a bit rich when you look at our exposure to Greece.”

“We haven’t created any rule for Greece, rules were in place and they’ve been applied,” Mr Draghi told an audience of the European Parliament.

Total ECB funding for Greek banks has now topped €100bn, as the central bank has been progressively drip-feeding ELA to stricken lenders in small increments that have dissatisfied Athens.

---- In a press conference dominated by talk of the validity of Nazi war reparations claims, Mr Tsipras dismissed threats to confiscate German property in Greece as compensation for the victims of the country's brutal Third Reich occupation.

However, he repeated that the question of Second World War reparations was a “moral” matter for his country.

"Today's democratic Germany has nothing to do with the Germany of the Third Reich that took such a toll of blood," insisted Mr Tsipras.

Chancellor Merkel reiterated her stance that any question of further compensation for events of 1941 remained firmly off the table.
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Any sudden event which creates a great demand for actual cash may cause, and will tend to cause, a panic in a country where cash is much economised, and where debts payable on demand are large. In such a country an immense credit rests on a small cash reserve, and an unexpected and large diminution of that reserve may easily break up and shatter very much, if not the whole, of that credit.

Walter Bagehot. Lombard Street. 1873

The monthly Coppock Indicators finished February

DJIA: +120 Down. NASDAQ: +213 Down. SP500: +169 Down.  

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