USDJPY Opens At 6-Year Highs, Extreme 'Relative Strength' Signals 30% Drop Potential

USDJPY has been on a tear in recent weeks. Since China unleashed QE-lite, JPY and CNY have greatly diverged with USDJPY breaking above 109 and pushing six-year highs. This recent 'relative strength' is the most extreme overbought for the currency pair since early 2001 - which saw USDJPY plunge 30% in the following six months. The tick-for-tick rise in Japan's stock market also broke a 9-month almost-perfect analog with the last time the nation raised its consumption tax. Perhaps even more worrying in the world of FX trading, ECB Governing Council member Ignazio Visco told the G-20 that it may not need to add stimulus measures after steps in the past three months pushed down the euro.

The 4C’s That Never Happened - And Those That Did

We didn’t get what we first postulated yet: Crisis became calm. Contagion became cured. And last but not least catastrophe morphed into an even grander state of complacency. What we did might be even more illuminating. Here’s what a few of us also know that we are not “wrong” about:"When a monkey throwing darts can outperform most of today's so-called 'best of the best'  hedge funds – we’re going to put our money on the monkey, rather than putting it anywhere close to where these people can put their hands on it for their own personal self-serving monkey business." What we don’t need – nor want – is another bowl of the 2008ish tripe washed down with this years new flavored Kool-aid.

Knife-Wielding Veteran Sniper Rushes White House, Wants To Warn Obama "Atmosphere Is Collapsing"

Of the stories in the past two days, there is hardly anything more bizarre than that of Omar J. Gonzalez, 42, of Copperas Cove, a veteran had served three tours in Iraq — and relatives said served as a sniper — managed to jump over the White House fence, sprinted more than 70 yards across the Northern Lawn, got to the front double doors of the North Portico, turned the brass knob and stepped inside the vestibule. "There he was grabbed and subdued by an officer standing post inside the door." He war carrying a folding knife with a serrated blade and was located just feet away from where Obama would have normally been, if only Obama had not just minutes ago taken the wife and kids for yet another weekend mini getaway.

Pentagon Prepares To Unveil Syria War Plans As "Broad Coalition" Crumbles

A day after US ambassador to The UN Samantha Powers stated, "we will not do the airstrikes alone if the president decides to do the airstrikes," and Russia warned, "bombing Syria without the cooperation of Damascus can have destructive practical consequences on the humanitarian situation in Syria," it appears President Obama's grand strategy to combat IS via a 'broad coalition' of allies is flailing. While the WSJ reports, The Pentagon is preparing war plans in Syria that would include an intensive initial wave of strikes against Islamic State targets, Germany's Foreign Minister Frank-Walter Steinmeier explained today that providing air support or sending ground troops to fight Islamic State is "out of the question for us." For now, it appears, the only nation involved in the 'broad coalition' is France. Why? Because as we said yesterday, this is merely over fears of more BNPs. "A key component of this would be allied participation," said a U.S. official; does '1' ally count?

This Is Why China Russia & China Are Now "The Enemy"

The suppression of gold prices is essential at all costs to the Anglo-American banking interests. The saber rattling and attempts to lure Russia and China into military conflict are about who controls the financial world. Russia and China keep accumulating the eternal currency – gold. The American Empire and their EU disciples continue to accumulate debt and print fiat currencies. Has fiat paper ever won out over gold in the long-run? Change is coming...

The People On This Photo Have A Warning For The Market: There Is "A Build Up Of Excessive Risk"

We are mindful of the potential for a build-up of excessive risk in financial markets, particularly in an environment of low interest rates and low asset price volatility,” the G-20 officials said in a communique released in Cairns, Australia. “We welcome the stronger economic conditions in some key economies, although growth in the global economy is uneven.”It is unclear just what that statement means: BTFATH, but only on a downtick?

50 Years Of Washington’s Air Wars: Why They Always Fail

Since it is almost impossible to win against guerrillas by only attacking from the air, "boots on the ground", as The Pentagon and military have advised, are needed to effectively fight IS. Obama and the American people - as a result of the Afghanistan and Iraq debacles — vehemently veto that idea. However, inserting U.S. military personnel for fighting or training locals likely would be also be counterproductive and would once again paint a big, red bulls-eye on the United States. The best option is for the U.S. government to do nothing.

The Fed Then And Now – Remembering William McChesney Martin, Jr.

These days, central banks have become so intertwined with the economy and capital markets that every word uttered by just about any senior Federal Reserve official is endlessly scrutinized to gauge what their next step might be. But it wasn’t always like this. There were times when the Fed actively defended the strict independence of monetary policy, as well as the role of free markets in creating prosperity and even preserving civil liberties. And those were the days of William McChesney Martin, Jr.

Military Plant In East Ukraine Devastated By Massive Explosion; Kiev Accuses Russia Of Using Tactial Nuke

Last night's headlines crowed in bright red flashing text that Russia and Ukraine had (once again) agreed a cease-fire and terms over the borders between the two nations. Perhaps not surprisingly, mere hours later, Ukraine is claiming that Russia has broken the truce... with the use of a tactical nuclear weapon at Luhansk airport. This comes on the heels of claims by the pro-Russia separatists that Kiev forces destroyed a massive military plant in Donetsk. Russia's defense ministry flatly denies the 'nuclear strikes' adding that "no reasonable person will take them seriously." This truce-breaking action has once again raised calls among Ukrainians for the nation to get its nuclear status back; something Russia is clearly strongly against.

The Big Picture For Gold And Silver

With precious metals back at 4-year lows against a backdrop of gold migration from west to east, paper vs physical divergences, 'disappearing' Comex positions, dark pools in London, collateral grabs, and massive monetary policy extremist actions; we thought the following two presentations worth considering. Tocqueville's John Hathaway delves into the darker corners of today's gold markets while Mike Maloney reminds us of the big picture behind gold and silver as wealth insurance. The failure of a monetary system is never a smooth road - it is rocky and undulating, with twists and turns that don't appear on any map. But the destination is always without question, despite suppression efforts: Gold will inevitably respond to an expanding fiat currency supply. That simple.

Russia FinMin Calls For Shift Away From US Treasurys Into BRIC Bonds, Settlement In Non-Dollar Currencies

it was Russia's finance minister Anton Siluanov who was the designated "bad guy", and as the WSJ reported, Russia is considering diversifying its debt portfolio away from countries that have imposed sanctions on Moscow and into the papers of its BRICS partners. Speaking on the sidelines of an annual investment forum in the Black Sea town of Sochi, Mr. Siluanov said the Finance Ministry wants to diversify its investment basket, and is looking for higher yields without too much risks. He said the ministry will consider buying papers issued by Brazil, India, China and South Africa, which along with Russia are known collectively as the Brics countries. "[We would like to] walk away from investing in papers of the countries that impose sanctions against us," Mr. Siluanov said, adding that the reshuffle would be carried out gradually. He didn't elaborate on when the first purchases of Brics debt may take place.

The Decline Of America's Economic Model In 1 Simple Chart

"You can't eat GDP, and you can't live in a rising stock market" is the striking phrase from NY Times' Neil Irwin as he offers the most damning chart of the decline of America's Economic Model (and dream). As we have explained vociferously, the most important thing to understand about today’s economy is: Around 1999, growth in the United States economy stopped translating to growth in middle-class incomes. The choice, by Greenspan and carried on by his followers, was to enable the financialization of the US economy for the benefit of the few, at the cost of the many. As Irwin concludes, and we explained previously, Americans feel disappointed by the economy; the new data show that they have good reason.

Greenspan's "Irrational Exuberance" Warning In Context

As the marginal investing bot continues to invest his marginal leveraged dollar-on-the-sideline on an equity market that, as Janet Yellen has explained to the poor, will create a "wealth effect" to sustain everyone through rainy days and retirement, we thought some context worthwhile. On December 5th 1996, Alan Greenspan - upon the recognition that equity market capitalization has bubbled to over 100% of nominal GDP - opined that investors had succumbed to "irrational exuberance." Since then, that 'exuberance' has become increasingly rational as the Fed pulls all its monetary-base expanding, deficit-funding, asset-purchases to keep the American Dream alive for a select (and shrinking) few...

Meanwhile, Here's What The "Super-Rich" Are Rushing To Buy

If you said shares of BABA, you'd be wrong. According to the Telegraph, the exodus out of paper wealth and into hard assets is reaching a fever pitch as the "super-rich are looking to protect their wealth through buying record numbers of "Italian job" style gold bars, according to bullion experts." The numbers cited by the paper are impressive: the number of 12.5kg gold bars being bought by wealthy customers has increased 243% so far this year, when compared to the same period last year, said Rob Halliday-Stein founder of BullionByPost. "These gold bars are usually stored in the vaults of central banks and are the same ones you see in the film 'The Italian Job'," added David Cousins, bullion executive from London based ATS Bullion.

GDP Watch: Summer 2014 Was World's Warmest Ever

Since weather has become the most crucial factor in forecasting economic growth, we thought it crucial to the future of central bank policy to note that Summer 2014 was officially the hottest one ever, according to NOAA. This of course means there is "pent-up" cold weather, which may explain the collapse in global growth expectations. However, this chatter about heat may surprise Americans (aside from those that live in the Western States) as the Mid-Atlantic and Northeast U.S. were running cooler than normal (thus concerns about growth). According to NOAA’s records, this is the 38th consecutive August and 354th consecutive month with a global average temperature above the 20th century average.

AP Reveals 8 Ways Obama's "Most Transparent Administration Ever" Blocks Information

"We have put in place the toughest ethics and transparency laws of any administration in history," President Obama proclaimed four short years ago... However, as AP Washington Bureau Chief Sally Buzbee said recently, the fight for access to public information has never been harder, and in fact, the problem extends across the entire federal government and is now trickling down to state and local governments. Here is Buzbee’s list of eight ways Obama's "most transparent" administration is making it hard for journalists to find information and cover the news...

Fear And Loathing In Scotland – Why The "NO"s Won & Lessons Learned From The Vote

8 in 10 "Yes" voters said they were motivated more by 'hope' than 'fear'. 6 in 10 "No" voters said they were motivated by 'fear' of independence and the "No" vote was almost entirely secured by overwhelming support from those aged above 55. So in a nutshell, old people filled with fear blocked independence. Going forward, the older generation problem will naturally resolve itself. So we know that the youth will be deciding the future. Thus, the real question becomes, what will influence the youth?