Baltic Dry Index. 548 +08 Brent Crude 60.41
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
“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.
For more on the reason nothing works anymore, scroll down to Crooks Corner.
It’s back! “The Stock Market for the next hundred years,” is back in
disgraced fallen former guru “Bubbles” Greenspan territory. Of course, it’s
hardly the same NASDAQ of year 2000. Apart from Apple, itself a bubble, much of
the Greenspan dot con rabble of 1999-2000 are long gone, but who’s counting.
Who says history doesn’t repeat.
Below, the “good news” that made history repeat.
U.S. stocks close at records; Nasdaq ends above 5,000
Published: Mar 2, 2015 4:43 p.m. ET
Consumer spending
falls in January
NEW YORK (MarketWatch) — U.S. stocks struck a positive note for the start of
March, with a rally on Monday lifting the Nasdaq Composite above 5,000 — a
level not reached since 2000 for the tech-heavy index — while the S&P 500
and the Dow Jones Industrial Average scored records of their own. The record-setting day for the major indexes came amid economic reports on Monday that pointed to a slowdown in manufacturing activity as well as consumer spending. However, investors brushed off slightly disappointing data, seemingly content with the fact the U.S. economy is still growing, albeit, at a more modest clip.
Consumer spending in January fell more than expected, while the saving rate rose as Americans chose to pocket their savings from cheaper gasoline. Meanwhile, the widely-watched Institute for Supply Management’s manufacturing gauge slowed in February, but was in line with expectations.
Construction spending, which fell unexpectedly in January, proved one big disappointment.
----Much of the buzz on Wall Street centered on the Nasdaq Composite COMP, +0.90% which added 44.57 points, or 0.9%, to 5,008.10 on Monday. The tech-heavy index has closed above 5,000 only twice before in 2000 and is only one percentage point away from its all-time record reached on March 10, 2000.
The index gained 5.7% since the start of the year, thanks to a 17% gain in its heaviest-weighted component Apple Inc. AAPL, -0.07%
“Nasdaq’s reaching a round number 5,000 and 5,050, which was a record, are serving like magnets to investors. Double all-time highs in large-caps and small-caps last week are also boosting confidence,” said Sam Stovall, U.S. equity strategist at S&P Capital IQ.
More
Elsewhere in the real world.
Abe Tainted by Scandal a Week After Farm Minister Quit
5:06 AM WET March 3,
2015
(Bloomberg) -- Just a week after
the resignation of his farm minister, Prime Minister Shinzo Abe has become the
latest Japanese politician to be tainted by allegations of financial
impropriety.
Abe will look into accusations in
a Sankei newspaper report that a local chapter -- headed by the prime minister
-- of the ruling Liberal Democratic Party broke funding laws, Chief Cabinet
Secretary Yoshihide Suga told reporters in Tokyo on Tuesday. The newspaper
reported that the chapter got a 500,000 yen ($4,170) donation from a company in
line to receive government subsidies.
While Abe’s support rate has
remained steady despite a series of scandal-linked resignations from his
cabinet in recent months, opposition grilling of ministers over financial
blunders has slowed budgetary debate and is delaying his economic and defense
agenda. Cabinet scandals were among the difficulties that forced Abe to step
down as prime minister in 2007, though the impact of the latest report is hard
to read, according to analyst Steven Reed.
More
Goldman Partner Who Called Japan's Demise Sees Similarities With China
10:00 PM WET March 2, 2015
(Bloomberg) -- Forecasts for
China to surpass the U.S. as the world’s main economic power are misplaced. So
says an observer who foresaw Japan’s eventual demise a year before its
land-price bubble began to burst.
“The vulnerabilities in China
today are very similar to the vulnerabilities in Japan,” said Roy Smith, 76,
who was a Goldman Sachs Group Inc. partner when he wrote a column saying
Japan’s rise as a financial hegemon was done. “Nobody agrees with me. But they
didn’t agree with me in 1990, so at least I have one right.”
Among the risks: bad loans,
overpriced stocks and a frothy property market are flashing danger for China’s
economy and putting pressure on a fragile financial system -- similar to
conditions that triggered Japan’s fall, said Smith, a finance professor at New
York University’s Stern School of Business. A further parallel is the burden of
an aging population, with mounting pension and health-care costs, he says.
While China probably will avoid
prolonged Japan-style stagnation, a major crisis could expose weaknesses that
aren’t apparent now, according to Smith.
“Most people today are talking
about China displacing the United States as the great power of the 21st
century,” he said in a telephone interview last week. “My view is that it is
more likely to end up like Japan -- that is, the status of a former would-be
superpower that isn’t.”
More
The 15 Most Miserable Economies in the World
6:05 PM WET March 2,
2015
Inflation is a disease that can wreck a society, Milton
Friedman, the late Nobel laureate economist, once said. Add rising
unemployment to the diagnosis, and his profession ascribes a rather
non-technical term to the debilitating effect on people: misery.That affliction this year will be most acute in Venezuela, Argentina, South Africa, Ukraine and Greece — the five most painful economies in which to live and work, according to Bloomberg survey data that make up the so-called misery index for 2015. (It's a simple equation: unemployment rate + change in the consumer price index = misery.)
In Ukraine's case, war will exact greater economic casualties. Tension with Russia-backed rebels will prolong joblessness in the eastern-European nation, and inflation won't offer much relief, the surveys showed. The one-two punch means Ukrainian consumers are set to be the fourth-saddest among 51 economies (including the euro area) based on forecasts for the misery measure.
----The depressing expectations for Ukraine still aren't quite as bad as what the embattled nation faced in 2014, when it finished second in the misery index. The 2015 projections, dismal as they are, would make Ukraine bright enough to jump past South Africa and Argentina from last year's misery-index readings.
The three countries that will probably see the most economic misery in 2015 — South Africa, Argentina and Venezuela — haven't budged much from their 2014 rankings, when they occupied three of the top four spots, the data showed.
At 78.5 percent, the estimated CPI inflation rate in back-to-back, most-miserable Venezuela more than quadruples Ukraine's inflation rate. The dire shortage of basic goods in Venezuela last week prompted neighboring Trinidad & Tobago to offer a tissue paper-for-oil swap.
More
Reality hits North Dakota's pricey apartment market; rents drop
By Ernest
Scheyder WILLISTON, N.D.
(Reuters) - It is getting cheaper to rent an apartment in North Dakota's oil
patch.Prices, which only last year rivaled levels in New York City and Geneva, have slipped about 15 to 20 percent in the past two months as dozens of new apartment buildings opened in Williston, Watford City and other oil hub cities.
Growth in demand has slipped because the plunge in crude oil prices has led to cuts in capital spending by energy producers.
There are still about
1,800 energy-related jobs unfilled in the No. 2 U.S. oil-producing state, and
there is still demand for apartments. But the accommodation shortage is nothing
like it was when the state's oil boom began six years ago. As new developments
start leasing, tenants are able to negotiate lower rents.
"You're starting to see
prices fall this year as more units come online," said Terry Metzler of
Granite Peak Development, which has built apartments and a shopping center in
Williston, considered capital of the state's oil boom, and has an additional
480 apartments and houses under construction.
When the state's oil boom began
in 2009, prospective tenants swapped stories of sleeping in cars overnight
because there wasn't enough housing. The dozens of new properties opening in
the past two years and at least 20 more opening in 2015 have helped put an end
to that.
Property managers, who only a few
months ago could heavily scrutinize potential tenants and reject anyone whose
credit or behavior was in doubt, are now so eager for move-ins they're all-but
volunteering to carry boxes.
More
And in the land once known as Greece.
Greece eyes last central bank funds to avert IMF default
Syriza is not interested in emergency EMU funding if it means kowtowing to Troika demands
Greece is preparing to tap its
final pension reserves at the country’s central bank if needed to avert a
devastating default to the International Monetary Fund and keep the government
going over the next two weeks.
The Greeks must pay the IMF
€1.5bn in a series of deadlines this month, starting with €300m as soon as
Friday. No developed country has ever defaulted to the IMF in the history of
the Bretton Woods financial system. Such a move would shatter confidence and
reduce Greece to a financial pariah in motley company with Zimbabwe.
George Stathakis, the economy
minister, said the government still has hidden reserves to keep operations
going for a few more weeks, brushing aside warnings that the state could run
out of cash within 10 days. “These stories are exaggerated. We have various
buffers, including €3bn or €4bn at the Bank of Greece," he told The
Telegraph.
It is understood that the central
bank deposits are mostly part of Greece’s social security and pension system.
Analysts say it is far from clear whether the government can legitimately tap
this money without breaching other fiduciary obligations. “We think the funds
are already down to €1.8bn. If they draw on this, how are they going to meet
their pension bills next month?” said one banker.
A senior Greek official opened
the door last week to a possible “delay” in repayments to the IMF, perhaps for
a month or two, setting off alarm bells among investors and bank depositors. It
was taken as an admission that the country is now desperate as capital flight
runs at €800m a day.
More
There can be few
fields of human endeavour in which history counts for so little as in the world
of finance. Past experience, to the extent that it is part of memory at all, is
dismissed as the primitive refuge of those who do not have the insight to
appreciate the incredible wonders of the present.
J. K. Galbraith.
At the Comex silver
depositories Monday final figures were: Registered 68.81 Moz, Eligible 108.35
Moz, Total 177.16 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
As a retiree now, it’s time to share what I’ve learned of that
incredible, entertaining era God made me live through. Below, the reason nothing works anymore.
Modern Monetary Theory (MMT) according to Graeme.
The Federal Reserve operates MMT using “deficient” numbers.
The real world operates on “perfect” numbers.
Wall Street banksters operate on “narcissistic” numbers.
Stock market crashes operate on “Granville” numbers.
Her Majesty’s Government of all types, operates on “weird” numbers.
The EUSSR operates on “irrational” numbers.
When I first started commuting from just outside Reading in the Thames
Valley to London Paddington and on to Bank tube station, my monthly return
train ticket cost £11.20 a month. The train often arrived pulled by a steam
engine, although diesels were being introduced and totally replaced steam in a
couple of years. That monthly train fare is now over £400 for a far less
comfortable train, and that’s only the fare to Paddington. Our central
banksters and politicians have ruined money as a store of value.
"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
The monthly Coppock Indicators finished February
DJIA: +120 Down. NASDAQ: +213 Down. SP500: +169 Down.
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