Dylan Ratigan Shreds Bernanke…

My take is this. Remember that the Fed is not the government, they are a group of private banking individuals who have stolen the very right to mint money in the United States. Therefore replacing Bernanke with yet another central banker puppet will have NO meaningful effect on the long term health of our economy. The right answer? The Fed needs to come down entirely, interest rates need to be set by the free market, and new methods need to be developed to control the quantity of money.

Martin Armstrong – WE WON!

Can you believe it? In the face of overwhelming pressure from YOU, the Department of Prisons backed down and agreed to keep Martin where he is! My understanding is that they just want to make the calling STOP!

Thank you to everyone who did, you may have just saved him from a terrible fate. I hope everyone realizes how RARE this event is. The Prison system is used to working in SECRET and they do stuff like this all the time according to my sources. Well, we shined a spot light on them and as soon as we did, they were forced to back down. This is a great example of the power that people possess and they don’t even know they possess it. It is, quite unfortunately, going to be very important that we use this power in the future again, and I’m sure that the next fight won’t be as easily won. That’s because the abuse in our prison system is a SYMPTOM of a much larger problem, that problem is rooted in our economy, in our money system, and in our failure to follow the rule of law.

Now then, we are still using the attorney to file a protective order for Martin, as we want to hold them to their word. The prisons are notorious for providing RETRIBUTION against prisoners who make waves – we must ensure that does not happen!

Also, there are other battles still to be fought! On the bigger issue of Martin being there to begin with, there is a law that prohibits courts from not honoring time served when they are sentenced. The judge in Martin’s case did not give credit for his time served while he was held in contempt of court as he made up his own exclusion to the rule… that exclusion does not exist in the law and the law says that the judge SHALL honor all forms of time served (shall is a mandatory word, I have a copy of the law coming). Then there’s the battle for punishment that is CRUEL and UNUSUAL. How come, three years after being beaten nearly to death, does he not have his teeth fixed?

And so, we may need your help again to get them to do what’s right. In the mean time, we can deservedly celebrate a clear VICTORY in keeping him safe for now! THANK YOU!

(Please share this post with others!)

Morning Update/ Market Thread 11/30

Good Morning,

First of all, I want to thank those who have taken a couple of minutes to make contacts on behalf of Martin Armstrong. Today, however, is the most important day to do so, I ask that everyone please redouble your efforts and get on the phone and talk to them (or even just keep their lines busy) while at the same time we email and fax! THANK YOU!

The futures are down slightly, below is a close up of the action in the DOW futures, left, and the past couple days on the right side in the /ES.



The dollar was down mostly, but has climbed back up and is now positive over Friday’s close, sitting just beneath what was key support, now key resistance. The dollar has some serious issues, that’s for sure, do not take its failure to advance lightly, the dollar dropping further from this point will wreak more havoc than those who think that we must keep it going down think. Bonds are about flat, oil is off substantially, and gold is down a little too.

Dubai markets just closed down 7.3% in the first day of trading following their default – oh, and don’t be fooled, that IS a big deal, yet another sign of a world gone mad, a world that inappropriately saturated itself with debt.

The Chicago PMI is out at 9:45 Eastern, the highlight of this week will be the employment report on Friday.

Let's start with a daily chart of the DOW. Here you can see that the action of the rising wedge is very similar to the way we topped in 2007, this is the strongest of the indices, and that chart just looks, well, scary:



I was very busy this weekend on the Armstrong stuff and did not get a chance to post my technical thoughts and charts that I had gathered. So, here are a few charts from Friday with just a few quick thoughts:

Friday was a disaster internally, way more than 90% of the volume was on the down side. During the rise off the bottom, the internals did NOT improve materially, that is a divergence against price. Normally the market rests after a 90%+ move, therefore in the short term I expect a pause, or slightly higher in the market. However, the signs are accumulating that wave B up may be over. But we can’t say that for sure still because the E.W. rules still has not eliminated higher as a possibility.

The VIX rose sharply off the bottom of an expanding wedge formation. That is a classic trend reversal pattern. There was a huge gap up and a hammer was produced. In circumstances like that, I would expect it to initially pull back along the stem, but later would expect it to advance. The P&F chart is still targeting 52:



Below is a daily chart of the Russell 2000. This chart is a classic double top Head & Shoulders chart. Interestingly, the RUT is down as I type, diverging from the XLF which is higher. This is an ominous sign, as the RUT tends to lead the market. While the DOW looks relatively healthy, they are but 30 stocks. This is a much bigger market, and it does not look healthy here at all. It looks to me like it’s done making its right shoulder and is moving down to the neckline. That is not a confirmed pattern until the neckline is broken, but it sure looks like a high odds proposition that it will:



The XLF gapped down and made an inverted hammer. You expect prices to reverse back up on a hammer like that, and that’s exactly what they are doing today. What’s important will be the action after the gap is filled:



The banks are even weaker than the XLF. Below is a bearish P&F chart showing the target on the banking index:



We need to pay attention to what is happening in the rest of the world too. The Japan Nikkei index is CRASHING, having moved down 15.6% in just the past couple weeks from its most recent high (15% move is considered a crash). Note in the chart below how it has fallen beneath its 200dma:



In this next chart, I have placed the SPX behind the Nikkei index… note how they generally move together, more or less, but now it has diverged huge against our own market. This is a key sign, I hope everyone is paying attention to this!



Below is the Nikkei P&F diagram with bearish target:



What’s happening in Hong Kong? Pretty much the same thing. Check out the P&F chart of the Hang Seng:



The German DAX is also producing bearish targets:



The DOW Transports as well as the NASDAQ Transports have produced bearish targets on their P&F charts, as has oil:





Below is a 10 year monthly chart of Gold that I saw in a very good article from the site Gold versus Paper . Please go to that site and look at his analysis and comparison of this parabola versus the pre year 2000 NASDAQ, it is very interesting. Parabolic moves can be VERY powerful, and they will end suddenly and without warning. But they can go much longer than rational people believe is possible, again, a good article there, please visit his site and read it:



Next is the chart of the NDX when it was at the same stage in 1998. The chart that follows this one is stunning, I’ll leave that to his site:



So, overall, there are more and more cracks developing world wide. We do not operate in isolation, the world is saturated with debt because of a money system that is based in debt. That system is the dream of central bankers, it has made them fabulously wealthy. As they try to fight debt problems with more money, all they get is more debt. It IS an impossible situation, the math simply does not work, and thus we are going to see a very troubled world until we get a new system in place. Hopefully it will be one based on rational thinking, one that works to support real growth and yet keeps the math under control. I think I have the workings for such a system. Not everyone is going to agree initially, unfortunately, but as time goes by, I believe more and more people will come to see what I see. I am still working to build consensus on it which is difficult, but regardless am going to start going public with it soon. There are certain features that I think are a must in order to maintain control and yet allow for flexibility and to absorb shock. I’m going to take up this fight and when I do, I simply won’t back down… the future depends on it!

Tom Petty - I Won't Back Down:

Uncle Jay Explains the News...

Yes, it's time once again, boys & girls, for Uncle Jay to explain the week's news...

60 Minutes – The Cost of Dying…

This is a valid economic subject. The percentage of money spent on end of life treatment is staggering, and it simply makes no sense.

Listen to the doctor talk about having someone you love “die badly.” I have experienced this with my mother-in-law. A diabetic whose kidneys failed, she lived the final SIX YEARS of her life on a dialysis machine, 8 hours every other day. But that wasn’t the hard part. One day she went to the hospital for a non-emergency visit and she suffered heart failure in the parking lot. My wife’s sister-in-law was with her and presented a “Do Not Resuscitate Order,” one that she had signed and everyone agreed was in her best interest.

The hospital staff refused to honor it, citing legal reasons – it seems that if you keel over in their parking lot, no paper and no set of circumstance will prevent them from trying to save you. They saved her alright… she was hooked to a machine that did everything for her and two days later she actually regained very partial consciousness. Have you ever heard the moans of the dying? You won’t forget if you have… more morphine, please, stat. And more, and more, and more. Until finally, 9 days later, and I do not know how much money and family suffering, but she finally went, the morphine finally pushed enough of her organs into failure. Truly, it was a terrible experience, one that I certainly hope I never have to witness again, much less experience. And for what?

As the Baby Boomers approach old age en masse, continuing such nonsense will be very expensive indeed.


Watch CBS News Videos Online

60 Minutes - Gold and Greed in the Congo…

Interesting what happens when the people fail to establish the rule of law in their own country. The disparity is simply amazing…

First we had blood diamonds and now we have blood gold? Seems like a stretch for 1% of world production, but you have to wonder what they will be doing when gold hits $4,000 an ounce?

Congo’s Gold (13 minutes):

Watch CBS News Videos Online

Greed and Chaos (1 minute):

Watch CBS News Videos Online

Uranium for Sale (2 minutes):

Watch CBS News Videos Online

With conditions like these I would venture a guess that the IMF has been involved! So, I simply Googled the phrase “IMF loans to Congo,” and sure enough, there it was, right from the IMF’s own site… IMF Approves Three-Year Loan for the Congo . Now, that was in the late ‘90s and they haven’t lent any more since, and the Congo hasn’t asked! But if you follow the IMF and their loans from Nigeria to Romania, to Iceland, you will find a trail that simply cannot be termed a trail of success. Give it a whirl, type in IMF and just about any country in the world and start reading.

It’s simply amazing how a group of bankers can anoint themselves the bankers of the world, create money from nothing and wind up being the world’s third largest holder of gold? Gee, how did that happen?



How the IMF acquired its gold holdings
The IMF acquired the majority of its gold holdings prior to the Second Amendment through four main types of transactions.
- First, when the IMF was founded in 1944 it was decided that 25 percent of initial quota subscriptions and subsequent quota increases were to be paid in gold. This represents the largest source of the IMF's gold.

- Second, all payments of charges (interest on member countries' use of IMF credit) were normally made in gold.

- Third, a member wishing to acquire the currency of another member could do so by selling gold to the IMF. The major use of this provision was sales of gold to the IMF by South Africa in 1970–71.

- And finally, member countries could use gold to repay the IMF for credit previously extended.

In other words, the IMF loans interest bearing debt backed money into existence to countries (who gave them that authority to mint money, did you?), money that they have no productive effort behind, and then they accept gold in repayment! Nice trick!

So, while the rest of the world quickly goes broke, the IMF is quickly concentrating the gold in its possession. By the way, who owns the gold in Fort Knox? Do you, the People of the United States of America, or do the privately owned central bankers? If you think it’s you, how come we are doing gold swaps with other nations? Who exactly is authorizing those transactions? The Fed? Who is the Fed?

Tell you what, there IS a better way, and guess what… it’s NOT a currency backed by gold.

Martin Armstrong Update and More Info…

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UPDATE: VICTORY HAS BEEN ACHIEVED FOR NOW! THANK YOU FOR ALL YOUR HELP! The Prison has agreed to back down, please see Martin Armstrong – WE WON!

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As of the time of this post, thankfully, Martin has not yet been moved. But we are learning a little bit more where this attempt to move him is coming from. Here is some information sent to me from a supporters of Armstrong who have knowledgeable on the inner working of Ft. Dix, and also are familiar with all of Martin’s legal cases and are in contact with an attorney who is going to start legal proceedings on the subject of this move on Monday. We have now consolidated all the contact information and proceedures onto the following three pages:



Page number 2 contains a new strategy for contacting the Judges who have legal oversight of Armstrong’s movement because of his Habeas cases. Page 3 is the contact information for people within the prison system. I would ask that everyone please take a few minutes of your time to contact these people as suggested. Once notified, these people will not be able to claim they didn’t know what was happening. THANK YOU for your efforts to contact him!

For those interested, below is the actual Habeas that is open in the Supreme Court:




This information has also been included in the prior post on this situation…

U.A.E. Blocks Sunday Times...

Regardless of the spin you see from “analysts” and mainstream media sources regarding how large or small the impact of the Dubai debt default is, and whether or not you believe that the U.A.E. will bail Dubai out, the following article reflects what I believe is likely to become a lot more prevalent as debt induced events continue to unfold around the globe. The ramifications quickly bleed over from just debt backed paper money and into the real world… Indeed, desperate people do desperate things, including the censoring of media:
U.A.E. Blocks Sunday Times Over Coverage of Dubai Debt Crisis

By Henry Meyer and Zahraa Alkhalisi

Nov. 29 (Bloomberg) -- The United Arab Emirates blocked distribution of the U.K. Sunday Times newspaper today due to its coverage of the Dubai debt crisis, the London-based weekly’s representative office in Dubai said.

The News Corp.-owned newspaper was barred from sale and the Sunday Times is awaiting further instructions from the authorities, the office said in a statement.

The National Media Council, the U.A.E. body responsible for the media, declined to comment. The move came after the Sunday Times published a photo montage in today’s edition showing Dubai ruler Sheikh Mohammed Bin Rashid Al Maktoum sinking under a sea of debt.

The city-state on Nov. 25 asked for a delay on repayments of $59 billion in liabilities, sparking a sell-off in global markets. Dubai amassed at least $80 billion in debts to develop itself into a tourism and financial center, building the world’s tallest tower and biggest man-man islands. A property slump has left Dubai unable to service its debts and dependent on neighboring emirate Abu Dhabi for help.

U.A.E. legislation dating back to 1980 threatens imprisonment for journalists who criticize the government or royal family. It does not apply to foreign media organizations, which are governed by special laws.

Under a new draft law, local media organizations which “insult” senior government officials or the royal family face fines of up to five million dirhams ($1.36 million), and those which knowingly publish “false information” or stories which “harm” the economy may be fined up to 500,000 dirhams.

U.A.E. newspaper Al Khaleej criticized the international coverage of Dubai’s debt, in particular the U.K. press, as a “media attack” on the success of the city-state. Abu Dhabi is the largest emirate within the seven-member U.A.E. Dubai is the second biggest.

Just another sign of things to come…

Martin Armstong – Forced to Move to a High Security Prison to Silence Him?

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UPDATE: VICTORY HAS BEEN ACHIEVED FOR NOW! THANK YOU FOR ALL YOUR HELP! The Prison has agreed to back down, please see Martin Armstrong – WE WON!

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Frankly, I cannot believe that I have to write the words that follow. I just learned that Martin Armstrong is being moved, possibly as early as Monday, from his current holding facility to a much higher security facility, MDC Brooklyn, which is similar to the facility he was in when he was in solitary confinement and where he was beaten nearly to death! This goes against the prison’s own rules and is against the law as he has two Habeas cases open in the Supreme Court.

Why would this be happening now with a little more than a year before he is eligible for parole? I and others contend that it is because of his recent writing activity and because of his recent interview with the New Yorker Magazine (The New Yorker - "The Secret Cycle…"), and also because there are now several media outlets requesting to do interviews with him – the prison simply does not want, for whatever reason, the access that we have been enjoying lately to continue. I spoke directly to Martin’s younger sister, Nancy, and this is her opinion as well. She is very upset over this move as she, “fears that he may not make it out.” She claims that Martin is very much afraid of this move and for good reason…

First let’s review the facts… whatever you believe about his innocence or guilt or innocence of any crime, the facts are that he was never put on trial for any crime. He was held in contempt of court for not producing what the judge ordered him to produce, something which he claims he didn’t have. He was placed in MDC Manhattan and was basically TORTURED. According to Nancy, he was locked in solitary confinement for almost the entire duration, suffering days on end and at times was intentionally awaken every hour or so all night long, night after night, in an attempt to get him to sign a confession. He was repeatedly told that he would not get the chance to see his 91 year old mother alive again if he did not sign the confession. This took place off and on for SEVEN YEARS. Then one day a huge convict, “a known homicidal maniac” named George, was locked in his cell with him where he proceeded to beat and strangle him until he thought he was dead. Later, according to Armstrong, a fellow inmate stated that the guards watched the beating and refused to open the door to stop it. He lost most of his teeth, and now, over two years later is still missing them because the prison system only has one dentist for over 5,000 inmates. He suffered a detached retina, broken ribs and other internal injuries that left him in intensive care.

They offered him a plea agreement to TIME SERVED if he would plea guilty and after 7 years, he could take no more and agreed, obviously under heavy duress. However, after pleading guilty, the judge instead of living up to the plea agreement sentenced him to the maximum amount allowable and he is now not scheduled for release until September of 2011, first eligible for parole in March 2011. His current location is at Ft. Dix, New Jersey where he is only 20 minutes from his mother and sister, a relatively safe facility. His sister takes his infirmed mother to visit him once a week, but she will not be able to make the journey into Manhattan. He is now under great stress as he believes he may not survive while inside the new location.

Inside this facility, I am told, he will be basically strip searched with nearly every movement, and he is not granted some of the “privileges” that he currently has access to, thus producing his work will be impaired, if not eliminated all together.

The question is WHY would they break their own rules and the law to move him now?

For a refresher, Habeas Corpus is defined as follows: “Habeas corpus (pronounced /ˌheɪbiːəs ˈkɔrpəs/) (Latin: You (shall) have the body) is a legal action, or writ, through which a person can seek relief from their unlawful detention or that of another person. It protects individuals from harming themselves or from being harmed by the judicial system.”

Below is Federal Bureau of Prisons document number p5100.08 that spells out exactly what must be considered before moving an inmate. Preceding the document is the pertinent paragraph for those who have active Habeas cases. This paragraph recites the LAW as it applies here as Armstrong has not one, but TWO Habeas cases at the Supreme Court in his current jurisdiction:






Below is the actual law (Frap 23) regarding Habeus and the proceedures to be followed when transferring prisoners who have pending Habeus cases:



Additionally, below you will find the Rules of the Supreme Court. Rule 36 on page 47 states the following:







How nice of a facility is MDC Brooklyn, the facility they are planning on moving him to? Well, here are three separate articles alleging various forms of abuse:

Documented cases abuse of detainees at MDC Brooklyn
Eleven federal jail guards, including a captain and three lieutenants, were charged yesterday with beating two inmates at the Metropolitan Detention Center in Brooklyn, one so badly, officials said, that a pool of his blood and bits of his hair lay on the floor of his cell when it was over.

The guards were also charged with covering up the beatings by filing false reports that blamed the inmates for having instigated the attacks. Eight of them pleaded not guilty yesterday at arraignments in Federal District Court in Brooklyn and were released on bail. The three others are expected to be arraigned in federal court within days.

Federal Prison Guards Facing Civil Rights Violations
Prosecutors say in November 2002, Lopresti, Rosebery, Tassio, Peterson and Santana participated in a planned attack on a former MDC inmate, identified in the indictment as John Doe #1, in his cell, and the subsequent cover-up. The attack, led by Lopresti, was carried out in retaliation for the inmate having "disrespected" Lopresti earlier that day by failing to heed Lopresti's request to remove a t-shirt that was wrapped around the inmate's head.

During the attack, the officers repeatedly struck, kicked and beat the inmate, leaving a pool of blood and clumps of the inmate's dreadlocks on the floor of the cell. The officers allegedly sought to disguise the retaliatory attack by tying the inmate's bedsheet into a noose and wrapping it around the bars of the cell's window in order to make it appear that the inmate had tried to hang himself. In written reports about the incident, the officers falsely claimed that the inmate had become combative as they attempted to prevent the inmate from committing suicide, thereby prompting the officers' use of force against him.

During the subsequent investigation conducted by the Department of Justice's Office of the Inspector General, Tassio initially admitted that her written report was false and that the inmate had not tried to kill himself, but later recanted and re-asserted the charged false claim about the attempted suicide.

America’s internal “gulag”

…While in jail, he was denied dental care and was unable to eat his food properly [Sound like what is happening to Armstrong?]. He was also diabetic, but was deprived of his medication for as long as three months. His blood sugar was high and he complained that his feet were numb. When he went on a seven-day hunger strike, vowing to continue until he died, he was thrown into solitary confinement and had his glasses taken away so he could not see.

The Brooklyn MDC is known to be particularly brutal. The New York Times and the Daily News carried reports earlier this year that detainees were slammed against the wall and had their arms, wrists, and fingers twisted and bent. Another common practice was to step on the detainees’ leg restraints. At the same time, the detainees were threatened and verbally abused. A report by the Office of the Inspector General of the Department of Justice wrote, “According to detainees, the verbal abuse included taunts such as ‘Bin Laden Junior’ or threats such as ‘you’re going to die here.’ ” Some Muslim detainees were denied any visitation rights for up to 90 days for praying.

Some of the abuses were caught on the jail’s surveillance tapes. The Daily News reported, “Inspector General Glenn Fine, whose staff reviewed 380 MDC videotapes, reported in 2003 that ‘These tapes substantiated many of the detainees’ allegations.’ Furthermore, the officers were not just a few bad apples but ‘a significant percentage of those who had regular contact with the detainees,’ Fine wrote last March.”


Think Armstrong will be able to produce those papers in that environment? His thoughts will not be on our economy, the rule of law, what’s happening to gold, or any such thinking… instead he will be focusing on SURVIVAL.

Did you know this type of thing was happening in America TODAY? Or, do we ignore it, blowing it off as the guilty getting their “just rewards?” I ask you, is this Armstrong’s “just rewards?”


- Last paragraph of "Looking Behind the Curtain - The Real Conspiracy…" April 9, 2009 Paper by Martin Armstong

Keep in mind that at no time in the history of mankind has a country held in prison a larger percentage of the population than we do now (not even South Africa during Apartheid), nor has their been a higher rate of conviction among those put on trial by our government, one of the very statistics that typically elevates the closer to the end of the current “empire” a nation is (this is because it shows that balance has been lost and that the government is exercising greater control):

There are people who are seeking new legal help for Martin on this issue as the law is clearly not being followed. Below is a plea for help from supporters of Armstrong and his family:




They are requesting that everyone please PHONE, EMAIL, AND FAX the following people to remind them of their responsibility to uphold the law and to protect Armstrong. The two primary people to contact here is his current Warden, Donna Zikefoose, who has, without consulting the judge as required by law, signed the order to move him. The other important contact is Traci Billingsley as she is the Public Information Officer of the entire Bureau of Prisons. This is the type of publicity I am sure they do not like.

We have now included contact information for the Judges as well. We appreciate taking the time to work on BOTH angles to increase the odds that we stop their planned movement.



Please do what you can. Send faxes, send emails, and call their phones on Monday and ask to talk to them! Ask them why the rule of law is not being followed in Martin’s case! Also please provide a link to this post on other blogs you follow, thank you.

ATTENTION: An update on Armstrong's situation with new contact information and strategy are included. I really appreciate everyone who puts in a few minutes to do this, it's very important for Martin! LINK: Armstrong Update!

Please consider the following poem:

First they came for the communists, and I did not speak out—because I was not a communist;
Then they came for the trade unionists, and I did not speak out—because I was not a trade unionist;
Then they came for the Jews, and I did not speak out—because I was not a Jew;
Then they came for me—and there was no one left to speak out for me.

- Pastor Martin Niemöller (1892–1984)

Video - The Dollar Bubble...

I do not agree with all the facts and conclusions of this video, but am playing it to simply show what others are thinking. Note that no one in this video correctly identifies the source of the inflation they are claiming to see. You must look to how our monetary system works before you can begin to correctly identify the problem (interest bearing debt backed money whose quantity is not in control), and to find solutions that work to keep the quantity of money under control for the long haul yet is flexible enough to allow for REAL economic growth while keeping PRICE inflation steady over time. Such a system IS possible.

The Dollar Bubble (30 minutes):


Here is Max Keiser's latest on the Dubai debt crisis along with his take on the dollar.

Max Keiser (8 minutes):

Morning Update/ Market Thread 11/27

Good Morning Wal-Mart Shoppers!

Welcome to Black Friday… But you have to wonder, is it Black Friday due to after Thanksgiving shopping or is it due to the stock market? Hmmm...

Well, from their close on Wednesday, the DOW plunged more than 300 points yesterday and since midnight have been climbing back out of the hole, now down about 190 points. Here’s a chart showing DOW futures on the left, and S&P futures on the right:



The dollar initially fell Wednesday evening to a new low and just when it appeared to be collapsing, magically the Dubai story broke and up the dollar jumped, back over the key 75 level and right into the upper downtrend line where it ran into resistance and turned down. The following chart is the daily dollar futures on the left and 30 minute chart on the right:



Bonds moved around some, but are basically back where they closed on Wednesday. Oil PLUMMETED, going from $78 to a little over $72 in very short order. It is now approximately $74. That move did cause it to break below the bottom trend line of its down channel… it tried to regain, but has failed to so far. Gold collapsed and fell all the way to the bottom of its rising expanding wedge, then bounced. It is currently at about $1,162, $32 below Wednesday’s close.

The news has now pegged this to the Dubai default story. However, there is much more going on besides that. There’s bank problems in Greece, there are debt and confidence problems in Japan, and there are derivative and counterparty issues involved with Dubai too.

I’m not sure how this will play out. There are going to be HUGE gaps in the charts on the open. Markets abhor gaps, they get filled eventually. If I were a member of the Pollyanna club, I would think that the selling was an overreaction and a buying opportunity. If I had an ounce of common sense, I would be long gone knowing that those who panic first, panic best. Or, I could be calm, cool, and collected, completely out of the fray. A spectator laughing at the spectacle of desperate clowns and market manipulators, knowing full well that with a debt saturated world that Black Swan events such as this would eventually appear. Gee, who could have known?

So today the overworked and overstressed “gatherers” will be out gathering in a marketing induced frenzy, while the “hunters” sit on the sofa drinking beer and watching their favorite Roman gladiator do battle in a taxpayer funded Coliseum, blissfully unaware that their modern day Rome is crumbling down around them. Oh yeah, there’s an uneasy feeling in the air, they just can’t put their finger on it.

Technically, we fell 50% of the gain of the last wave, erasing the past two weeks of market gains, just like that, while the markets were closed and the sheeple could not respond. I don’t know, but I’m thinking the sheeple who have yet to learn their lessons about our modern state of the markets are about to be taught another lesson. I have been warning that the background to the markets was not right. We had the very short end of the curve go negative and we had a backdrop of a declining dollar, a very dangerous situation. The market always knows, the stress leaks out in various places. This stress is caused by debt! Our masters are attempting to defy gravity, but the rule of debt is a natural law that cannot be defied. The rule is that all debts get repaid with interest in one way or the other. This stress would be the other.

All the criminals will be back to work on Monday, much will depend on how they plan to take your money. Profiting from the market at this point is going to be very tricky. I still believe that the selling will overwhelm them at some point and it could be ugly when it happens. That would argue for having some short exposure, and you can see that unless you are in front of it, you are likely to miss the beginning. But just how dangerous has front running been? VERY! This is why I’m still being patient waiting for the trendlines to break and for the E.W. count to be in a favorable position. This market has a long way to fall to get to reality, so there’s no need to get caught in the game too early.

And how about that Fibonacci spiral info? It’s now 3 for 4 dates this year from my perspective. The 4th date is December 10th. Pretty sure I’m going to have a position going in front of that timeframe. But in the mean time, it’s Black Friday, one way or the other – enjoy the show, the markets close early at 1:00 Eastern:

Steely Dan – Black Friday:

Central Bankers Taking Over the Globe with Debt…

This is exactly how the central bankers are now ACTIVELY ENGAGED IN THEIR PLAN. No, they are not going to get on the world stage and make the following announcement, “Ah hem…. We, the Central Bankers of the planet Earth, are hereby enacting our plan to control the people, nations, and natural resources of the planet, so that WE can CONTROL the globe and PROFIT from every transaction!”

No, no, that press conference won’t be held until AFTER it is complete. It’s now in progress, here’s how it works… start by infesting the globe with money that can only come into being when it’s backed by debt. Then add in a massive heaping of skanky derivatives and shaky debts, stir up the pot and begin creating one crisis after the other. Then step in like this:

IMF Gets $600 Billion Credit Line to Help in Financial Crises

By Sandrine Rastello

Nov. 25 (Bloomberg) -- The International Monetary Fund said it will have access to a credit line of up to $600 billion to make loans during financial crises after contributing countries agreed to fold commitments into one pool.

The agreement, yet to be approved by the IMF board, adds as many as 13 members from the current 26 to the so-called New Arrangements to Borrow, including emerging nations China, Russia, Brazil and India, the IMF said in an e-mailed statement.

The decision “marks an important moment for multilateralism and the fund, which will help the IMF’s effectiveness in its response to crises,” Managing Director Dominique Strauss-Kahn said in yesterday’s statement.

The deal goes beyond a pledge by leaders of the Group of 20 nations to contribute up to $500 billion to a credit arrangement that’s currently worth $54 billion, the IMF said. The worst financial crisis since the Great Depression prompted more nations to seek aid from the fund, created after World War II to help ensure the stability of the global monetary system.

The agreement, which merges existing commitments into one facility, makes it easier for the IMF to tap into its supplemental resources. The credit line will be “an effective tool of crisis management as a backstop for the international monetary system,” the IMF statement said.

While a general agreement on the NAB was reached at the G- 20 meeting in Pittsburgh in September, talks on the specifics stalled over divisions between some emerging and developed nations over voting rights relating to the credit facility.

Borrowed From Members
The IMF has estimated that its current credit line was insufficient when the financial crisis boosted demand for loans. It then started to borrow from individual members, such as Japan, to continue lending to countries in difficulty.

To ensure the institution would continue shoring up economies around the world, G-20 leaders in April pledged to add $500 billion to the IMF’s resources.

Some of these contributions were bilateral loans, while China agreed to participate by buying the first IMF notes. Some countries, like the U.S., made theirs directly to the NAB.

When the new credit-line agreement is activated, all the bilateral loans will fall into it, Andrew Tweedie, who heads the IMF Finance Department, said in a Nov. 20 interview. It won’t come into effect before next year, he said.

So, the IMF who comprise the world’s central bankers go the individual central bankers and get money… of course this is just for show and to confuse the world… they could just as easily just create their own IMF money, and I’m sure will, but instead they pretend that they are “borrowing” money from countries around the world. Well, were did that money come from? The same central bankers!

Then, they take the money at the IMF level and do this with it…

Serbia Gets 3 Billion Euros From IMF to Counter Global Crisis

By Aleksandra Nenadovic

March 25 (Bloomberg) -- Serbia and the International Monetary Fund agreed on a 3 billion-euro ($4.1 billion) bailout to help the country repair the damage to its economy by the global financial crisis, Economy Minister Mladjan Dinkic said.

The accord will last two years, he told reporters in Belgrade today.

Last year, Serbia opened a $516 million credit line with the IMF, joining countries including Hungary, Ukraine and Latvia in seeking outside help to cope with the effects of the crisis. Like other emerging markets, Serbia is grappling with a lack of credit and a plunging currency as the economy contracts for the first time in a decade.

Serbia is also hoping for additional commercial loans from the World Bank and the European Union that will be negotiated on March 27 in Vienna. Serbia already has received a $600 million aid package from the World Bank.

On March 24 central bank Governor Radovan Jelasic said Serbia’s economy may contract 2 percent this year. There is a “downside risk” to this forecast because the government doesn’t have enough funds to spur the economy through spending, he added.

Finance Ministry spokeswoman Kristina Radovic said on March 17 that Serbia didn’t draw any funds from the original credit signed in November.

BINGO! Ding, Ding… Johnny, we have a sucker on the line! And in this way Serbia now must conform to the conditions of the loan or they will be cut off. What did the central bankers do to “earn” this money? What and who gave them the right to mint money on the global stage and to indebt entire nations? I think you know the answer to that… they gave themselves the power to do so, no one would stop them as the politicians and the judges are bought off along the way.

And because all their “money” is debt, this is the end result…


Dubai Debt Delay Rattles Confidence in Gulf Borrowers

By Laura Cochrane and Tal Barak Harif

Nov. 26 (Bloomberg) -- Dubai shook investor confidence across the Persian Gulf after its proposal to delay debt payments risked triggering the biggest sovereign default since Argentina in 2001.

The cost of protecting government notes from Abu Dhabi to Bahrain rose, extending the steepest increase since February as Dubai World, with $59 billion of liabilities, sought a “standstill” agreement from creditors. Its debt includes $3.52 billion of bonds due Dec. 14 from property unit Nakheel PJSC. Dubai credit-default swaps climbed 90 basis points to 530 after yesterday increasing the most since they began trading in January, CMA Datavision prices showed.

“There is nothing investors dislike more than this kind of event,” said Norval Loftus, the head of convertible bonds and Islamic debt at Matrix Group Ltd. in London, which manages $2.5 billion of assets including Dubai credits. “The worst-case scenario will, of course, be involuntary restructuring on the Nakheel security that brings into question the entire nature of the sovereign support for various borrowers in the region.”

Dubai World’s assets range from stakes in Las Vegas casino company MGM Mirage to London-traded bank Standard Chartered Plc and luxury retailer Barneys New York through asset-management firm Istithmar PJSC. The Dubai government’s attempt to reschedule debt triggered declines in stocks worldwide that had been rebounding from the worst financial crisis since the Great Depression.

‘Debt Burden’
“We understand the concerns of the market and the creditors in particular,” said Sheikh Ahmed Bin Saeed Al- Maktoum, who chairs the Supreme Fiscal Committee in charge of apportioning financial support to ailing companies, in the first statement to come out of the Dubai government since the announcement about debt rescheduling. “However, we have had to intervene because of the need to take decisive action to address its particular debt burden.”

The MSCI Emerging Markets Index of stocks had the biggest decline in four weeks, falling 2.2 percent, led by Russia and China. Europe’s Dow Jones Stoxx 600 Index lost 3.3 percent in London, the biggest decline since April 20. South Africa’s rand and the Turkish lira weakened 2.1 percent against the dollar. Hungary’s forint lost 1.7 percent per euro. Credit-default swaps on Russia increased to 205 basis points from 192.
The MSCI World Index of 23 developed markets has risen 26 percent this year after banks worldwide recorded more than $1.7 trillion in writedowns and losses and governments committed about $12 trillion to shore up economies.

‘Shock’ Announcement
“The announcement was a shock,” said Beat Siegenthaler, chief emerging-market strategist at TD Securities Ltd. in London. “It is strongly affecting European markets.”

Dubai, ruled by Sheikh Mohammed Bin Rashid Al Maktoum, borrowed $80 billion in a four-year construction boom to transform the economy into a regional tourism and financial hub. The emirate suffered the world’s steepest property slump in the global recession, with home prices dropping 50 percent from their 2008 peak, according to Deutsche Bank AG.

Moody’s Investors Service and Standard & Poor’s cut the ratings on Dubai state companies yesterday, saying they may consider Dubai World’s plan to delay debt payments a default.

Gulf region default swaps jumped, with contracts linked to Bahrain adding 29 basis points today to 223.5, the biggest increase since Feb. 18. Contracts linked to Abu Dhabi added the most since February yesterday, climbing 36 basis points to 136.5 and were another 23 basis points higher at 159.5 today, according to London-based CMA. Qatar default swaps rose 13 basis points to 117, adding to yesterday’s 11 basis-point increase.

‘Further Defaults’
“Dubai is the most indicative of the huge global liquidity boom and now in the aftermath there will be further defaults to come in emerging markets and globally,” said Nick Chamie, head of emerging-market research at Toronto-based RBC Capital Markets.

Saudi Arabia default swaps climbed the most since February, adding 18 basis points to 108. The British Bankers’ Association asked the U.K. government to intervene with Saudi authorities over debts of at least $20 billion owed to as many as 100 banks by Saad Group and Ahmad Hamad Algosaibi & Brothers Co., two family holding companies based in the oil city of Al-Khobar, according to a letter dated Nov. 20.

Default swaps on Dubai World unit DP World Ltd., the Middle East’s biggest port operator, jumped by a record 181 basis points to 540.5 yesterday and were priced another 72 basis points higher today at 612, according to CMA data.


Manmade islands and gleaming new cities in the middle of the desert all devoid of people and real commerce. Of course the people who provided the financing deserve to lose their money and this will ripple around the globe, just one of several problems interrupting our markets (DOW futures are down more than 200 points this Thanksgiving even though the markets are closed). Amazing how news like this occurs when the U.S. markets are closed.

The people of the world need to wake up. Their futures and their natural resources are being robbed. There is a much, much better way, details coming soon. Meanwhile the Central bankers are already enacting their plan as they sing to Serbia, “Got you where I want you…”

The Fly's - Got you where I want you:



Outstanding artwork done by AZRainman

Happy Thanksgiving America!

While I’m sincere in my warm wishes, I want everyone to keep in mind what the world faces and how we are all being played.

Beginning about the time the markets closed yesterday and into the evening and now morning, the currency markets have been going haywire. Large moves, first down in the dollar, and now up are occurring. The Japanese Yen is strengthening rapidly and broke through key support. In the Middle East, Dubai in the U.A.E. (one of the world’s richest oil nations), is looking like they are defaulting on some of the debt behind their bright and new people-less cities. Greece has banks that are in trouble, while at the same time Japan is finally having a confidence crisis over their debt.

And here in the good ol’ U.S.A., our politicians blow smoke up our skirts about the economy while the banksters rob us blind and take over control of what used to be our free markets. While the markets are open, they gun their positions and when the markets are closed to normal people like you, this is the type of action that occurs in the futures:



Yes, we have a lot to be thankful for. We also have a lot of cleaning up to do. Enjoy the holiday, but keep focused on what’s coming and what we are going to do about it. Everyone has a role to play, your help and support is going to be needed. In concert with others I have developed a plan that I think is going to work and is going to get traction as it will get the people behind us, it will get the states behind us, and it should even get most of the banks behind us (okay, maybe not the central banks, lol).

IT'S BEGINNING TO LOOK A LOT MORE RISKLESS (or maybe NOT!)


PS - By the looks of the poll results on gold backing, I have quite a bit of education still to do. Please buy the film and learn about the history of the gold standard. Wanting control over the QUANTITY of money is indeed nobel, but gold is not the way to do it:


The Secret of Oz

Morning Update/ Market Thread 11/25

Good Morning,

Equity futures are up this morning while the dollar is breaking below support and making new lows for the year. DOW and S&P overnight action is below:



Bonds are down slightly while the Dollar, which has been flirting with Disaster, has broken beneath recent support and hit an overnight low of 74.40.



Gold, of course is going ballistic and is now pushing the $1,200 mark with an overnight high of $1,184 an ounce. Oil is up only slightly after breaking below support and triggering a new bearish Point & Figure target of $71 a barrel:



The MBA purchase applications “data” was first out this morning showing a whopping 9.6% advance over the week prior! This is amazing, especially in light of the recent many large negative prints in the past 6 weeks or so. Here’s what Econoday has to say about it:
Highlights
Two prior weeks of big declines in the purchase index raised talk that however good October may have been good for home sales, November was likely to mark a reversal. But not so fast! The purchase index surged 9.6 percent in the Nov. 20 week, biting into mid single digit and low double digit declines in the prior two weeks (note MBA said the prior week was revised slightly lower but offered no further details). The sequence suggests that let down with the end of first-time buyer credits was limited to the beginning of November. Refinancing applications fell 9.5 percent in the week but still make up more than 70 percent of all applications, a reflection of extremely low mortgage rates including an average 4.82 percent for 30-year fixed loans.

So, the MBA revised the prior week DOWN, thus making this week look like a larger increase than had the revision not happened. But we can’t see the raw data, much less how it’s compiled, so we really don’t know ANYTHING about what’s happening besides the fact that there is no transparency and that we are being manipulated right along with the presentation of the data. Other sites, by the way, that attempt to track this data will be thrown off by revisions… it is completely IMPOSSIBLE to track when all that is reported are percentage changes and revisions are made without telling how large they are. This is the type of stuff that will bring down confidence in the entire system.

Next up is Durable Goods orders. It was expected to produce a month over month POSITIVE .5% change, instead it was a NEGATIVE .6% change. The year over year figures are coming up on easier comparables. Overall, this report is worse than expected:
Highlights
The outlook for manufacturing cooled a bit in October. New orders for durable goods in October fell 0.6 percent, after a revised 2.0 percent rebound in September. The drop in October was well below the market forecast for a 0.5 percent boost. Excluding the transportation component, new durables orders fell 1.3 percent, following a 1.8 percent jump in September.

The drop in new orders was led by machinery which fell a monthly 8.0 percent, followed by a 2.1 percent decrease in computers & electronics. Also declining were communications equipment and "other" durables. Partially offsetting were gains in primary metals, fabricated metals, electrical equipment, and transportation.

New orders for capital equipment continued to rebound from a drop in August. New orders for nondefense capital goods rose 1.2 percent in October after an increase of 3.2 percent the month before. These orders had dropped 7.8 percent in August.

Year-on-year, overall new orders for durable goods improved to minus 11.9 percent in October from minus 18.8 percent in September. Excluding transportation, new durables orders rose to minus 11.3 percent from down 16.3 percent the previous month.

Today's durables orders report indicate that recovery in manufacturing is not a smooth one. Of course, new durables orders are one of the most volatile market moving indicators published by the government and no one month makes a trend. But at face value, the recovery in manufacturing cooled just a little in October. Equities will not like the orders numbers but jobless claims dropped more than expected and some see the personal income report as healthy (though the details suggest not so much).



Keep in mind that just because the yearly line is pointing up does NOT mean that it is actually rising, just that yoy comparisons are getting better… this yoy number is still significantly negative which means that the economy is still getting worse than it at this time last year, at least in this regard.

Next up is Personal Income and Outlays… This came in almost exactly as expected with wages basically flat but core inflation readings firming slightly:
Highlights
Personal income was mildly positive in October and spending was up as auto sales rebounded. Personal income in October edged up 0.2 percent, following a revised 0.2 percent rise in September. October's gain matched the consensus forecast. The important wages and salaries component, however, was flat after a 0.1 percent dip in September, indicating that consumer spending power is not improving.

We are seeing probably the final impact of cash-for-clunkers on personal spending in October. Motor vehicle sales fell sharply in September with the ending of incentives in August. In October, auto sales rebounded and returned to normal-at least for the recovery trend. Personal consumption expenditures jumped 0.7 percent after a 0.6 percent drop in September. The market had forecast a 0.5 percent boost in PCEs. The boost in October was led by durables, which rebounded 2.0 percent after an 8.8 percent plunge in September. In the latest month, nondurables rose 0.2 percent while services advanced 0.3 percent.

Inflation firmed in October. Headline PCE price inflation rose to 0.3 percent from a 0.1 percent rise in September. Core PCE inflation edged up to 0.2 percent in October from 0.1 percent the month before. The consensus had expected a 0.2 percent core gain for the latest month.

Year on year, personal income growth for October came in at minus 1.0 percent, improved from minus 1.6 percent in September. Year-ago headline PCE inflation rose to plus 0.2 percent from minus 0.6 percent in September. Year-ago core PCE inflation firmed to up 1.4 percent in October from up 1.3 percent the month before.

On initial blush, the October personal income report looks moderately good. But after taking into account weakness in wages and salaries and that the spending gain was a partial rebound from clunkers, it is indicative of a soft consumer sector. Markets have much to sort through this morning. Some will focus on headline numbers for personal income and see good news. A nice drop in jobless claims this morning may add to that temptation. On the other hand, durables orders were weak. Most likely, the good news on jobless claims will likely tip the balance, boosting equities and firming interest rates.



Weekly jobless claims fell below the 500,000 mark for the first time in a year, with a headline number of “only” 466,000 which was below the 495k consensus. This produced a euphoric spike in the futures:
Highlights
Improvement in initial claims is picking up steam in what points to lower payroll losses for November's employment report. First time claims fell 35,000 in the Nov. 21 week to 466,000 (prior week revised 4,000 lower). The four-week average also broke below 500,000, down 16,5000 to 496,500. Continuing claims are also falling, down 190,000 to 5.423 million in data for the Nov. 14 week, but here the change also reflects the expiration of benefits. Those receiving extended benefits fell 34,600 to 539,500. Continuing claims may be clouded but initial claims offer perhaps more reason for optimism than any other piece of economic data.



What’s there to say? The economy needs to produce 150,000 jobs a month to break even and we’re still stacking on newly unemployed workers while others simply run out of benefits. Meanwhile the politicians are clueless that the more debt they inject into the system, the higher unemployment goes. Debt leads to unemployment, they are tied together once debt saturation occurs, and it’s here. Having a money system backed by debt, then only worsens the situation when one attempts to spend their way out. It is quite literally impossible to do so.

The spike up may be just the thing to top off the current up move. The VIX diverged bearishly yesterday, again showing signs of severe complacency to me. This is setting up a very dangerous situation with the dollar falling in the background. This trend is simply not sustainable and it’s going to end in tears. Funny, and as I type those words, the entire spike caused by this report melted away.

Consumer Sentiment and New Home sales come out at 10 Eastern, the petroleum report at 10:30.

McHugh believes we are making a small rising wedge which is a terminal pattern. If so, this may be the pattern that ends the final wave up of B up. This pattern could have another zig-zag or two left in it.

The move below support in the dollar is the real news of the day. The next support area is down around 71/72. Breaking support was largely caused by the British GDP report coming in stronger than expected with a -.3% reading in their 3rd quarter. Those who think that the U.S. can artificially keep rates at zero forever while monetizing just don’t realize how international capital flows work. We will be punished, and the government’s attempts to keep everything under control will fail in time.

So, we are now right on the 1,107 SPX pivot point. 1,111/ 1,113 is rejecting advances so far. A run up to the 1,121 area would be the next stop, then comes the 1,133 pivot. If we break below 1,107, support will be 1,101, then the 1,091 pivot.

We are putting in a top, that much I know. A break below support in the dollar might be exactly what’s needed to suck in the last of the dollar short people to make a reversal possible. If the dollar continues down, I am going to get REALLY nervous, as in that’s the stuff where crashes are eventually born. Those thinking the dollar rising will make a crash haven’t seen anything compared to the dollar going down hard in the background. The best outcome from here is that the dollar goes up, equities descend. The worst possible outcome will be found by further devaluing the dollar. That, my friends, is what is called, “Flirtin’ with Disaster!”

Molly Hatchet - "Flirtin' With Disaster"

Morning Update/ Market Thread 11/24

Good Morning,

Equity futures are roughly flat to up a little this morning after being lower, then higher:



The dollar swung higher and then fell back to flat overnight, collapsing back down quickly, showing its propensity to return to the 75 level. There’s a battle going on here, and my saying is that the longer something keeps knocking on the door, the more likely it is to break through… but it cannot and will not sit at this level forever, the break will be interesting. Break up, equities will go down. Break down, most people believe equities will moonshot, and that may be true initially, but the dollar breaking down WILL eventually tank equities, there is no fooling mother nature, no way to get around paying our debts, they must be cleared. Bonds are higher, and if you’re looking for a clue as to equity direction for the day, that is probably it. Oil is down slightly, gold is up a little more, $1,169.

Yesterday was the 10th Monday ramp job out of the past 12 weeks. I must have read four different people talking about that, look for future ramp jobs to come on, oh, Friday. No, wait, most of the Goldman boys are gone that day spending their bonuses, so we better schedule that for Wednesdays.

Both Robert Prechter and McHugh pointed out the time and price relationships in play at this juncture; the B wave rally has now taken exactly half the time of the A wave descent, and it has retraced half the plunge, a very important confluence of price/time. Thus Prechter said, once again, that he believes the top was just put in. McHugh is saying it’s important, but there is still the EW possibility of higher.

The short term stochastics are obviously overbought, there are new short term bearish divergences on top of the historic much larger ones.

The absolutely unreliable ICSC showed store sales were flat week over week but rose 3.3% yoy on much easier comparisons. That’s interesting because sales tax collections are down roughly 8%. Which is correct? Well, the sales tax collections, of course as they are not manipulated. The ICSC suffers the same flaws as the indices with substitution bias among other inaccuracies. The Redbook likewise showed a 2.8% yoy increase against easier comparisons, again, a flawed report, as sales tax data is also yoy, but even it is now measured against this time last year making for a very easy comparison.

The first revision of Q3 GDP lowered the annualized growth rate down from the much ballyhooed 3.5% down to 2.8%, a mere drop in growth rate over that advertised of only20%! Business as usual here during the Great Deception. But of course that was expected… Look, they can, and do, make this number come out any way they want. Did the economy actually grow in the 3rd quarter? NO. It is still shrinking when measured in real money, as it has been ever since the year 2000. At any rate, here’s the propaganda for public consumption:
Highlights
The recovery is not as strong as hoped, based on the latest Commerce Department revision to third quarter GDP. Economic growth was revised downward to an annualized 2.8 percent from the initial estimate of 3.5 percent. The market consensus had expected a 2.8 percent figure for the new estimate. Nonetheless, the third quarter boost is still the first positive number for GDP since a 1.5 percent gain in the second quarter of 2008. The third quarter increase, however, appears to have ended the recession which faded with a 0.7 percent dip in the second quarter.

The downward revisions were broad based, lowering estimates for PCEs, nonresidential structures, residential investment, business inventories, and net exports. Upward revisions were seen in business equipment & software and in government purchases.

But compared to the second quarter, the improvement in real GDP in the third quarter still reflected upturns in personal consumption, exports, and residential fixed investment and a smaller decrease in nonresidential fixed investment and inventory investment. These were partly offset by rise in imports, a downturn in state and local government spending, and a deceleration in federal government spending.

Motor vehicle output added 1.45 percentage points to the latest quarter's growth, compared to the initial estimate of 1.66 percentage points.

Year-on-year, real GDP stood at minus 2.4 percent compared to minus 3.8 percent in the second quarter.

Turning to inflation, the GDPI price index was nudged down to a 0.5 percent annualized pace and compares to the initial estimate of 0.8 percent and the median forecast of 0.8 percent.

Two items stand out in the report. Final sales were revised down to an annualized 1.9 percent from the initial estimate of 2.5 percent. Demand is not as strong as earlier believed. Second, the downward revision to the price index also indicates softness in demand. These two issues could weigh on equities at open and soften Treasury yields. But there is much more economic news ahead today.



And talk about more fantasy, marked to fantasy corporate “profits” on quarter over quarter comparisons were up and annualized (key word), 71.9%... huh? PLEEEZZZE. How 'bout we annualize the weekly Treasury auctions, shall we? Try $9 trillion a year, so that all the businesses in this country can generate $1 trillion a year in phony profits! Nice try, Econoday, let’s just stick to the year over year percent change that shows a 7.2% drop which is better than the 19.2% plunge in the second quarter. Yes, reported profits were up slightly, but the yoy number is against a much easier comparison, and that time last year the financial industry was still marking somewhat to market, unlike this year where all bets are off and they are back to marking all their assets to whatever gives them the biggest bonuses. Again, no basis in reality, look at tax receipts instead for reality:
Highlights
Corporate profits in the third quarter posted a sharp gain to $1.181 trillion annualized-up from $1.031 trillion the prior quarter. Profits in the third quarter were up an annualized 71.9 percent, following a 24.5 percent boost the prior quarter. Profits are after tax but without inventory valuation and capital consumption adjustments. Corporate profits are still down 7.2 percent on a year-on-year basis, compared to down 19.2 percent in the second quarter.

The Case-Schiller data showed a very slight improvement, the 20 city index rose from 146 to 146.51 in September. Here’s Econoday:
Highlights
Home prices continue to improve according to Case-Shiller data. The report's index for the top 10 cities rose 0.4 percent in September, on the low side of what is a long strong string of improvement. Year-on-year rates continue to improve, now down to single digit contraction at minus 8.5 percent for the 10 index. A look at the quarter-to-quarter rate shows steady improvement, at plus 3.1 percent for both the third and second quarters. Improvement is especially evident in the West and Florida, high flying areas hit hardest by the housing downturn. This report, noted for its vigorous methodology, continues to contrast with price data in the existing home sales report where contraction, though slowing a bit, is still underway. New home sales data for October will be posted tomorrow. Prices in this report did show improvement in September.

Pretty much a yawner. Another report came out and said that 1 in 4 mortgages are now underwater…

NEW YORK (CNNMoney.com) -- In a sign that more foreclosures could be on the horizon, 23% of people with mortgages owe more than their home is worth, according to a report released Tuesday.

Almost 10.7 million U.S. mortgages were "underwater" as of September, said research firm First American CoreLogic.

Another 2.3 million homeowners are within 5% of negative territory, the report said. The two figures combined comprise almost 28% of all residential properties with mortgages.

Negative equity, also called an "underwater" or "upside down" mortgage, has become more common as home values plummet. The report is closely watched because borrowers who are underwater are more likely to be foreclosed.

Of course we know that the option-ARM reset debacle is just now picking up where sub-prime left off. Amazing how many people ignore it.

Consumer Confidence comes out at 10AM...

I’m just waiting for the nut to crack and not getting too worked up about anything at this juncture. Soon the dollar and equities will pick a trend, it’ll probably be real obvious when they do. The E.W. counts say that trend will be up in the dollar and down in equities. If the dollar rolls down further as those in the administration are trying to force, I think the outcome will not be what they expect. They think they can devalue debt away. The problem nature has with that is that when they do, people’s purchasing power goes down, thus they must work more to get the same amount of goods. It all boils down to productive effort. The law of nature states that all debts get repaid with interest in one way or the other… you can fight that law, but guess who wins?

The Clash – I Fought the Law:

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