globaleconomicanalysis.blogspot.com / by Mike “Mish” Shedlock / Friday, January 30, 2015 6:27 PM
Greece Will No Longer Deal with ‘Troika’
It now strongly appears as if Greece, Germany, and the nannycrats in Brussels are all on one hell of a collision course. Both sides have dug in, and the war of words has escalated in all corners.
For example, please consider Greece Will No Longer Deal with ‘Troika’, Yanis Varoufakis Says
mises.org / by Frank Hollenbeck / JANUARY 31, 2015
The European Central Bank (ECB) finally pulled the QE trigger by committing to purchase 60 billion euros of government debt and other assets every month until September of 2016 or until inflation gets closer to 2 percent.
The made-up excuse for this legal counterfeiting is that Europe is dangerously close to having (a very flawed) index of consumer prices drop below zero; as though calamity would strike Europe if the index were to register a negative number. The ECB claims it needs to print money because lower oil prices and — previous to that — a stronger euro were causing average prices to deviate from its 2 percent inflation target. It’s like having your supermarket run a 50 percent off sale on steak one weekend, and then having the ECB try to make all other prices in the supermarket go up so your total bill at the cash register goes up.
The 2 percent inflation was never meant to be a target, but a ceiling. The problem has never been too little printing but too much printing. Deflation has never been a real problem (see here, here and here), but bouts of inflation have regularly led to chaos and social upheaval.
Don’t Fear Price Changes
The drop in oil prices is creating a change in relative prices that are part and parcel of a capitalist economy. Such changes are critical to guide resources and production in the direction of where they are most needed. They occur constantly and are not to be feared. They should be embraced as a necessary adjustment to guide limited resources to produce output that best meets society’s demand. A central bank interfering with the measuring stick of prices to alter absolute and relative prices to reach some non-meaningful target shows just how much mainstream economics has become nonsensical. By targeting an aggregate number, central banks distort individual prices and interfere with the efficient allocation of resources and goods and services.
shtfplan.com / Mac Slavo / January 31st, 2015
Want to own your own home, but stuck, temporarily, renting until you can? You aren’t alone.
Wolf Richter outlined a pretty eery scenario.
The 2008 financial Armageddon was in larger part a result of the housing bubble bursting. Thanks to the subprime mortgage scandal, millions of homeowners were put in homes they couldn’t afford, making the awful game of musical chairs an inevitable and tragic charade.
Maestro to the musical chairs was Goldman Sachs, who unbeknownst to the public, was selling toxic securities for risky mortgages, while secretly betting on the collapse of the housing market. According to McClatchy:
Everyone was swept up in the chaos. Goldman Sachs and the other banks got bailed out. The public absorbed the costs, and the Federal Reserve set out on the biggest intervention since World War II.
marctomarket.com / by Marc Chandler / Jan. 30, 2015
The US dollar turned in a mixed performance in the last week of January. It slipped against the euro, yen, sterling and the Swedish krona, while rising against the other G10 currencies. The Swiss franc was the weakest of the majors, losing about 4.5% of its value against the dollar, encouraged by signs the Swiss National Bank may have intervened.
The dollar also rose against most of emerging market currencies, except for a handful of eastern and central European currencies. The Russia ruble depreciated by nearly 10% following the S&P’s removal of its investment grade status, and a compromise struck with Greece to discuss further sanctions given the increase in hostilities in east Ukraine.
In addition to technical factors, which we pointed out last week, an important consideration that has stalled the dollar’s upside momentum are the doubts about a mid-year rate hike. The FOMC statement had upgraded its economic assessment, but did recognize the important of international developments. Whereas we regarded that as a prudent addition, many others viewed it as an escape clause of sorts.
The implied yield of the December Fed funds futures contract fell 3.5 bp on the week to 41 bp. It finished 2014 at 71 bp. The same general pattern was evident in the December 2015 Eurodollar futures. The implied yields fell 5 bp on the week to 66.5 bp. It finished last year at 91.5 bp.
SilverDoctors, Published on Jan 31, 2015
Peter Schiff, Published on Jan 30, 2015
healthimpactnews.com / January 31, 2015
In a shocking interview recorded on the Robert Scott Bell Show Thursday January 29th, 2015, Leanna Smith gave details of how her two daughters were taken away by medical authorities and CPS in Arizona, and explained how her youngest daughter has allegedly been sexually and mentally abused while in State custody:
While allegations have been made against the parents as a reason for removing their two daughters, apparently no criminal charges have ever been filed against either the father or the mother.
So why did Arizona take these two children away from their biological parents?
Medical Kidnapping Occurs to Stop Medical Malpractice Lawsuits
During this interview, Leanna explains to Robert Scott Bell how authorities in Arizona have been able to get away with taking her daughters away and covering up their alleged medical malpractice. She explains that once a child is a ward of the State, parental rights are severed and the parents can no longer sue the hospital or doctors legally, since they do not have custody of their children any longer.
financialsense.com / SY HARDING / 01/30/2015
The fears after 2001 were that the Fed’s easy money policies to pull the economy out of the 2001 recession, followed by even more easing, including the near-zero Fed Funds rate instituted after the 2008 financial meltdown, would result in runaway inflation.
Spiraling inflation was so sure to show up that gold, the historical hedge against inflation, surged up in a powerful 10-year bull market, rising from $250 an ounce in 2001 to $1,900 an ounce in 2011.
Gold finally gave up on its expectation for rising inflation in 2011. It has been in a serious 40% bear market decline since.
Not only has inflation not materialized, but fears are now rising of potential deflation, a dangerous period when prices of all assets decline, and the trend feeds on itself for long periods, as businesses and consumers hold off on spending waiting for still lower prices.
Japan’s 20-year deflationary spiral from 1990 and its devastating effect on Japan’s economy and stock market is the most recent example.
schiffgold.com / BY MIKE FINGER / JANUARY 30, 2015
German Central Bank Continues Gold Repatriation
CME Opens Physical Gold Futures in Hong Kong
edgetraderplus.com / by Michael NoonanJanuary 31, 2015/
Mention is often made that one should wait for confirmation of a particular move in
These large traders do not make such overtly strong commitments to the short side
We will rely on the proverbial picture being worth 1,000 words and not add anything
peakprosperity.com / by Adam Taggart / Friday, January 30, 2015, 6:27 PM
Early in my business career, I was faced with a challenge that gave me an appreciation for a critical lesson about life and business. It’s that oftentimes, even with the best of intentions, our actions create consequences completely different from what we intend.
It’s that insight that makes me so concerned about the grand central banking experiment being conducted around the globe right now. With little more than a lever to ham-fistedly move interest rates, the central planners are trying to keep the world’s debt-addiction well-fed while simultaneously kick-starting economic growth and managing the price levels of everything from stocks to housing to fine art.
As with an earlier article I wrote focusing on the Bullwhip Effect phenomenon: the complexity of the system, the questionable credentials of the decision-makers, and the universe’s proclivity towards unintended consequences all combine to give great confidence that things will NOT play out in the way the Fed and its brethren are counting on.
A Puzzle To Solve
Two years after graduating business school, I joined the team at Yahoo! Finance as its Marketing lead. It was a crazy time there; the tech bubble was in mid-burst and advertiser dollars — the main source of revenue for the business unit — were fast drying up. We went through several general managers within my first year there as the leadership scrambled for a sound course to chart.
Amidst the turmoil, a lot of misfit projects were tossed in my lap. Partly because I was the “new guy” and least likely to refuse, but mostly because the engineering-driven culture there didn’t quite know what to do with a marketer, so any square peg looked like fair game.
bullionbullscanada.com / by Jeff Nielson / Friday 30 January 2015 12:28
On December 4th, 2008; Canada ceased to have a legal, legitimate government. It was on that date that Stephen Harper (and his Conservative regime) demanded that Parliament be illegally suspended, on the (supposed) grounds of a “national emergency”. And on that date; Canada’s Governor General, Michelle Jean, rubber-stamped Harper’s demand.
What was the basis of the so-called “national emergency” which prompted Harper’s illegal act? Canada’s Opposition parties had publicly stated their intention to hold a Parliamentary vote, for the purpose of voting Harper’s corrupt, minority government out of office. While undoubtedly the prospect of being thrown out on his ass was a personal “emergency” for Stephen Harper; there is no possible way in which any rational human being could consider a Parliamentary vote to be “a national emergency”.
There can be no equivocation here. Harper’s demand to illegally suspend Parliament (and thus illegally usurp political power) was an act of treason. Michelle Jean’s choice to rubber-stamp that demand was also an act of treason. While the position of Governor General is largely ceremonial; she had one duty/responsibility to uphold: ensuring that any/all procedural acts in which she participated were legal and constitutional.
No mentally competent adult could have construed Harper’s illegal demand to be a legitimate basis for suspending Parliament. Her decision to rubber-stamp Harper’s demand made her a simple, criminal accomplice to Harper’s overt act of treason.
Arguably, however, these original acts of treason were not the greatest outrages which occurred at that time. The greatest outrages came immediately afterward. Canada’s corrupt Corporate media began a massive campaign to brainwash the Canadian people.
wolfstreet.com / by Wolf Richter /
The oil industry is dead-serious when it talks about slashing operating costs and capital expenditures. It has to. Preserving cash is suddenly a priority, after years when money was growing on trees.
In the US, the cost cutting has reached frenetic levels. One place where it shows up on a weekly basis is the number of rigs actively drilling for oil. And that rig count dropped by 94 to 1,223 in the latest week, as Baker Hughes reported today. A phenomenal plunge, by far the worst ever. In January, the rig count crashed by 276, the most ever for a calendar month. That’s 18.4%! the rig count is now down 386 from its peak on October 10, by nearly a quarter!
And yet, it’s still just the beginning. The chart shows the breathless fracking-for-oil boom that started after the financial crisis. Not included are the rigs drilling for natural gas. That fracking boom had started years earlier and ended in a glut and total price destruction that continues to this day (chart). Note the two-month cliff-dive, the worst ever. During the financial crisis, the oil rig count fell 60% from peak to trough. If this oil bust plays out the same way, the rig count would drop to 642! The bloodletting in the industry would be enormous.
acting-man.com / by Bill Bonner / January 30, 2015
Dow down 195 points on Wednesday – another 1%-plus move. Gold sank too – down $6.90 to settle at $1,279 an ounce.
With the European Central Bank in QE mode, stocks should be catching a bid. Instead, they seem to be following commodities – down. But who knows? The situation is so crazy that only a disabled person could understand it.
Why do we say that?
Because a report released last week told us that one out of every three people on Social Security’s disability program is a mental defective. In Washington, DC, the rate of nuttiness among the disabled is even higher – 42%. No surprise there.
And just to show we’re not making this up, here’s the report from CNSNews.com:
Who better to understand what is going on in the financial world than a crazy person? Fortunately, America’s zombies are going crazy in ever-greater numbers.
guns.com / by
According to emails obtained by the American Civil Liberties Union, federal authorities planned to monitor gun show parking lots with automatic license plate readers.
The insight comes from a damning report released by the ACLU this week on a secretive program by the U.S. Drug Enforcement Administration to build a massive database of license plates images collected by automated license plate reader devices. As part of this investigation, emails released through the Freedom of Information Act detailed a planned cooperation between the DEA’s National License Plate Recognition initiative and the Bureau of Alcohol, Tobacco, Firearms and Explosives to scan and record the plates and vehicle images of gun show attendees.
“DEA Phoenix Division Office is working closely with ATF on attacking the guns going to [redacted] and the gun shows, to include programs/operation with LPRs at the gun shows,” reads an April 2009 email.
The time and place mentioned in the email coincides with known information on the Justice Department’s Fast and Furious operation, a controversial “gunwalking” scandal that possibly transferred as many as 2,000 guns to drug traffickers in Mexico. That program was run out of the Phoenix ATF Field Division office, just two miles from the DEA office.
21stcenturywire.com / BY JANUARY 31, 2015
As 21WIRE reported last year, the White House’s new candidate for US Attorney General has a dubious record when it comes to ‘terrorism cases’. Our question: is she what the US needs now, or would she fit in better in a police state regime like China or Egypt?
As US Senate confirmation hearings resume Monday, President Barack Obama will be hoping to finally off-load some dead weight in AG Eric Holder, replacing him a new appointee to run the Department of Justice (DOJ).
Incredibly, US government lawyer and DOJ nominee, Loretta Lynch, has repeatedly sided with dodgy FBI stings, rogue interrogators and banana republic henchmen in Africa…
(Image Source: Daily Signal)
What Lynch (photo above) has willfully turned a blind eye to in this story is astonishing. Her recent statements in a high-profile terrorism case indicates that she’s on board with some of the worst federal practices America is suffering today; no due process, and state-sanctioned torture used to obtain his bogus statements from numerous synthetic terrorists.
In the case of Somalian born British citizen Mahdi Hashi, court documents reveal how authorities first pressured him to become an informant, before detaining him in Djibouti, Africa, and without having been informed of any of his rights. Then, they began threatening him with sexual abuse and using forceful methods in order to extract various statements and ‘confessions’ under physical and psychological duress. Finally, having stripped him of his citizenship, and – being “rendered” to New York in 2012, he was held in secret for five weeks. He’s been in solitary confinement ever since.
jamnoise72, Published on Jan 30, 2015
….and so it begins. There will come a point where the chip will not be ‘optional’….
zerohedge.com / by Tyler Durden on 01/30/2015 21:40
“Reality” is not “perception”
davidstockmanscontracorner.com / by David Stockman •
Janet Yellen and her band of money printers think they are driving the GDP forward toward the nirvana of full employment and the achievement of every last dime of “potential GDP”. What they are actually doing, instead, is inflating the Wall Street bubble to ever more dangerous heights because their monetary injections never make it to the real main street economy; they just whirl around in the canyons of Wall Street where they enable speculators to wildly inflate the price of risk assets.
Now comes another GDP report card, this one “disappointing”. Not only does it refute the claim of the Wall Street Keynesian chorus that the U.S. economy hit “escape velocity” last spring and summer, but it is also chock-a-block full of evidence that the Fed’s machinations have nothing to do with the performance of the real economy.
As usual, the seasonally adjusted numbers on a annualized basis are full of noise—-the most significant being inventory fluctuations. The latter flattered the 5% number that so excited the headline writers last quarter, but had the opposite impact this time. The actually gain in real financial sales, therefore, was only 1.8%—-even more tepid than the headline.
But the annualized quarterly figures just don’t cut it, in any event. National defense spending in Q4 declined at a whopping 13.2% annualized rate, but unfortunately, it did not reflect the actual hard-chop to the Pentagon’s budget that is long over-due. It was just the payback for the anomalous annualized growth of 15% in Q3. The latter period tracks the fiscal year-end in September, and therefore the big figure which ballooned Q3 GDP did not reflect economic growth at all—–just the usual scramble of bureaucrats to waste money at year end before appropriations lapse.
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