Baltic Dry Index. 595 -06 Brent Crude 65.49
LIR Gold Target in 2019: $30,000. Revised due to QE programs.
"A company for carrying out an undertaking of great advantage, but nobody to know what it is".
The South Sea Bubble 1720
Forced by Germany into the corner
of getting the blame for forcing Greece to default and almost certainly exit
the wealth destroying failed euro, Draghi and the ECB blinked yesterday, and
provided a trickle of more cash to Greece. The new “drop dead” date moves out a
week to May 6th, one day
before Great Britain votes in its general election precipitating the next European
crisis. This is now what passes for adult policy making in the 21st
century EUSSR. Still I remain “optimistic” that something will “turn up.” Rumours
are around that Greece and the Troika are about to pull a rabbit out of a hat
at the coming weekend. Buy the rumour, sell the news.
"Buy gold and sit on it. That is the key to success."
Dr. Franz Pick
Greek Banks Get More Funds as ECB Weighs Collateral Discount
9:24 AM BST April 29,
2015
The European Central Bank raised
the amount of emergency liquidity available to Greek banks, while signaling
that access to such funds may become more difficult if bailout talks remain
deadlocked.
The Governing Council lifted the
cap on Emergency Liquidity Assistance by 1.4 billion euros ($1.5 billion) to
76.9 billion euros on Wednesday, people familiar with the decision said. That
follows an increase of about 1.5 billion euros last week. An ECB spokesman
declined to comment.
With no speedy deal between
Greece and its creditors in sight, the ECB is studying measures to rein in ELA
funding to limit risks. Staff have proposed increasing the discounts imposed on
the securities banks post as collateral when borrowing, and the Governing
Council may discuss the issue at its May 6 meeting.
“When the Eurosystem as a whole
gives such support, we have our own collateral rules, we can set them
ourselves,” ECB Governing Council member Ardo Hansson told reporters in
Tallinn, Estonia. “When it’s ELA, then that’s given by the national central
bank, which has some latitude in this matter.”
Intended to counter deposit
outflows, Greece’s ELA is provided by the country’s central bank at its own
risk, and against lower-quality collateral than the ECB accepts.
Household and business deposits
fell 1.9 billion euros in March to 138.6 billion euros, the lowest level since
January 2005, according to Bank of Greece data released Wednesday.
Weekly ELA injections reflect
deposit outflows, as liquidity buffers are kept at about 3 billion euros to
give the Bank of Greece and the ECB time to react in an emergency.
More
'We won't surrender': Firebrand Greek minister risks fresh schism with Europe
Syriza's radical Leftist energy chief warns Grexit will land a 'mortal blow' to monetary union
Hopes that a revamped Greek bail-out team would finally break a two-month deadlock with creditors took a fresh blow on Wednesday, as the Leftist government's firebrand energy minister pledged "no surrender" to international lenders.Highlighting a deep schism within the ruling party over Greece's future in the single currency, Panagiotis Lafazanis said there could be "no compromise" with creditor powers, who were seeking "subordination and surrender" from his government.
"Our government will not bow down, neither will it surrender," wrote Mr Lafazanis in a Greek newspaper. "Syriza will not accept an agreement that would be incompatible to its radical commitments."
A popular figurehead of the party's radical Left Platform, Mr Lafazanis attacked the Troika for "water-boarding" the Greek economy, choking its people into submission.
"If our 'partners' and the IMF believe that they will blackmail us using the refusal of financing as a weapon, and that they will terrorise the Greek people forever using the 'bogeyman' of default and of a national currency, they are woefully deluded."
The energy minister, who has ties with Moscow, has been one of the fiercest critics of the Troika's plans to undercut Athens' promises to address Greece's "humanitarian crisis" through raising wages and pensions for the poorest.
More
http://www.telegraph.co.uk/finance/economics/11571500/Firebrand-Greek-minister-risks-fresh-schism-by-promising-no-surrender-to-Europe.html
Meanwhile in America. Recovery? What recovery! While the Telegraph’s renowned AEP remains “an optimist,” Don Quixote was an optimist too. Right now we have the global economy stalling, with a disastrous currency war underway. China barely growing if not actually stalled. Europe all but falling apart, the emerging market economies reeling from China’s slowdown. Russia in a trade war with the EUSSR. Now comes the USA economy actually contracting once the unintended inventory build-up is stripped out. In my world view there’s not a lot to be optimistic about. But Iceland, I understand, is on something of a roll.“I am an optimist. It does not seem too much use being anything else.”
CNBC, with apologies to Sir Winston Churchill.
Ignore the 'whiff of panic' as US economy stalls
The economy contracted in the first quarter once inventories are stripped out. 'It is hard to put lipstick on that pig,' said UniCredit.
The US economy has suddenly stalled. A blizzard of shockingly weak figures raise the awful possibility that America's six-year growth cycle since the Great Recession has already rolled over, with unsettling implications for the world.Worse yet, this apparent exhaustion is taking hold even before the Federal Reserve has begun to raise interest rates or to drain any of its $3.7 trillion of quantitative easing and balance-sheet expansion.
Former US Treasury Secretary Larry Summers warned in Davos earlier this year that the Fed typically needs to cut rates by three or four percentage points to combat each cyclical downturn. It is currently at zero. "Are we anywhere near the point when we have 3pc or 4pc running room to cut rates? This is why I am worried," he said.
"Nobody over the last 50 years, not the IMF, not the US Treasury, has predicted any of the recessions a year in advance, never," he said.
We should not ignore his warnings lightly, yet for once I am an optimist, clinging to the belief that the US will recover from the strange "air pocket" of early 2015. A siege of snow and ice across the North East over the late winter - for the second year in a row, and some say evidence of a drastically slowing Gulf Stream - has obscured the picture. The first flash of data is often wrong, in any case.
Yet the latest GDP figures are indisputably atrocious. "It is hard to put lipstick on that pig: This is unequivocally a very weak report," said Harm Badholz from UniCredit.
The slump in the annual growth rate to 0.2pc in the first quarter does not convey the full horror of it. Once you strip out a surge in inventories - often a pre-recession warning - the economy contracted sharply. Investment in business buildings and factories fell 23pc. "A whiff of panic is in the air," said the Economic Cycle Research Institute.
The putatitve post-winter rebound keeps disappointing. Citigroup's economic surprise index has tumbled to deeply negative levels. The Conference Board's index of consumer confidence fell from 101.4 to 95.2 in April.
More
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11571395/Ignore-the-whiff-of-panic-as-US-economy-stalls.html
Stocks slip, euro near two-month high as US economy loses steam
TOKYO | |
(Reuters) - Asian stocks stumbled
on Thursday while the euro held near two-month highs against the dollar after
surprisingly downbeat first-quarter economic growth in the United States - a
key export destination for many of the region's economies.
Spreadbetters expected the equity
markets to stabilize a little in Europe, forecasting Britain's FTSE, Germany's
DAX and France's CAC to open flat to slightly firmer.
The disappointing news on the
world's biggest economy comes on top of a worrying slowdown in China and
persistent worries about Europe as Greece scrambles to avoid bankruptcy.
New Zealand's central bank said
early in the day that it could cut interest rates if domestic momentum
weakened.
MSCI's broadest index of
Asia-Pacific shares outside Japan fell 1.1 percent with South Korean,
Australian, Chinese and Hong Kong shares suffering losses.
Japan's Nikkei slumped 2.6
percent, extending losses after the Bank of Japan kept monetary policy
unchanged. The decision had been expected, but
disappointed some participants who had bet it may ramp up its already massive
stimulus program.
More
“Success is going from failure to failure without losing enthusiasm.”
The talking chair, with apologies to Sir Winston
Churchill.
At the Comex silver
depositories Wednesday final figures were: Registered 62.63 Moz, Eligible 112.68
Moz, Total 175.31 Moz.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Today we let David Stockman cover yesterday’s sad
US GDP report.
Punk Q1 GDP Wasn’t Surprising—It Extends A 60-Year Trend Of Exploding Money And Imploding Growth
by David Stockman •
During the heyday of post-war
prosperity between 1953 and 1971, real final sales—–a better measure
of economic growth than GDP because it filters out inventory
fluctuations—-grew at a 3.6% annual rate. That is
exactly double the 1.8% CAGR recorded for 2000-2014.
And after this morning’s punk GDP
report in which growth stayed above the flat-line by a hair only due to a
massive inventory build, the contrast is even more dramatic. Real final
sales actually declined by 0.5% during Q1 and, more importantly, reflected a
mere 1.1.% annual growth rate since the pre-crisis peak in the winter of
2007-2008.
The long and short of it, therefore,
is that there has been a dramatic downshift in the trend rate
of economic growth during an era in which central bank intervention and
stimulus has been immeasurably enlarged. In this regard, the
size of the fed’s balance sheet is the telltale measure of its
policy intrusion. That’s because the only mechanism by which the
Fed can actually impact the real economy is through open market
purchases of treasury bills, bonds and other existing securities for the
purpose of raising their price and lowering their interest rate or yield. And
it doesn’t matter whether the Fed is buying short term T-bills to peg the
federal funds rate or 10-year notes to drive down long-term interest rates and
flatten the yield curve.
Thus, the old-fashioned
business of pegging the Federal funds rate and the new-fangled intrusion of
massive bond buying under QE are all the same maneuver. They
both involve expansion of the central bank balance sheet and, therefore,
the systematic injection of fraud into the financial system.
That is to say, growth on the
asset side of the Fed’s balance sheet involves the acquisition
of financial claims that arise from the utilization of real
labor and capital resources. This happens, for example, when the
Fed buys treasury notes that were issued to fund the purchase of
concrete and bulldozer operators under the highway program or
when new homes embodying carpenters’ wages and
lumber are financed with Fannie Mae guaranteed mortgages purchased by
the Fed.
That contrasts with the liability
side of the Fed’s balance sheet, which expands dollar for dollar with the asset
side, but represents nothing more than bottled monetary air confected
from its digital printing press. Stated differently, the Fed’s fundamental
tool of open market purchases of public debt and other securities,
and thereby the expansion of its balance sheet, embodies the exchange of
claims based on something for credits made from nothing.
The Fed’s current $4.5 trillion
balance sheet, in fact, could be expanded to sport liabilities of $10
trillion or even $100 trillion by a few keystrokes on the Fed’s
computers—–if the open market desk could find enough public debt,
private debt, equities and even seashells to buy and stash on the asset side.
But questions of practicality or likelihood aside, the basic principle is
that the liability side of the Fed’s balance sheets represents spending power
made out of nothing. Accordingly, the greater the size of the Fed’s
balance sheet, the greater is the amount of fraud released into the
financial system and the more intrusive is its deforming and distorting
impact on the capital and money markets and ultimately the real main
street economy.
More.
Much, much more."It is extraordinary how many emotional storms one may weather in safety if one is ballasted with ever so little gold."
William McFee
Solar & Related Update.
With events
happening fast in the development of solar power, I’ve added this new section.
Updates as they get reported.
Below, solar news
from South Australia. Australia’s only free state that never took any of Britain’s
transported convicts.
Solar power plant floating on wastewater hailed for multiple environmental benefits
By Isabella Pittaway Posted
A field of solar panels floating
atop a wastewater pond in South Australia is being hailed as an environmental
breakthrough that could even prove a hit with tourists.
The plant, hailed as the first of
its type in Australia, has been built at a wastewater treatment facility at
Jamestown in the state's mid north.
Sydney-based Infratech Industries
developed new solar technology for the site, at a cost of $12 million.
Company director Felicia Whiting
said the water cools the panels, making them more efficient.
"Solar panels don't really
operate when they're at a high temperature, so we get a longevity of the panels
and also the solar rafts can shade the water," she said.
"We actually get a cooling
of the water which is beneficial for water treatment.
"We can get about 57 per
cent more efficiency than a land-based solar system."
Ms Whiting said the plant also
boosted water conservation by preventing evaporation and cutting blue-green
algae outbreaks.
"This floating solar has a
dual benefit of being able to prevent water evaporation and that translates
into water savings," she said.
"For a one megawatt plant,
that's about 70,000 kilolitres a year. That's a big saving and it's also a
revenue for any host water utility to save that water and on-sell it."
The project sourced 90 per cent
of its materials within South Australia.
More"The modern mind dislikes gold because it blurts out unpleasant truths."
Joseph Schumpeter
The monthly Coppock Indicators finished March
DJIA: +118 Down. NASDAQ: +209 Down. SP500: +161 Down.
