Archive - Mar 2013
March 30th
Was the Iraq War About Grabbing Oil … Or Keeping It Off the Market?
Submitted by George Washington on 03/30/2013 11:51 -0500Was the Real Purpose of the Iraq War to Restrict Oil ... So As to Raise Oil Prices?
"Betray Your Bank Before Your Bank Betrays You"
Submitted by Tyler Durden on 03/30/2013 11:07 -0500
Suddenly it should be dawning on a lot of Europeans that deposit-guarantee limits matter. In Slovenia, the maximum is 100,000 euros per depositor, the same as in Cyprus. (Deposit- insurance programs vary among the 17 countries that use the euro.) For a few days last week, it looked as if customers at Laiki and Bank of Cyprus would lose even some of their insured deposits, which would have been a sacrilege. That plan was scrapped, but could resurface elsewhere for all we know should some genius at the German Finance Ministry insist upon it. The one constant among bailouts of euro-area countries is that there is no rhyme or reason, much less fairness, in the way many details get worked out... So far, there have been no signs of a mass exodus in countries such as Italy or Spain. But deposit migrations can happen slowly, with lots of time passing before they appear in official statistics. Or maybe little will change and most bank customers will go on believing “it can’t happen here,” until one day it does.
Following The Smart Money In Asia
Submitted by Asia Confidential on 03/30/2013 11:00 -0500The smart money is selling Hong Kong and Singapore property. This implies real estate prices may be topping out, with far-reaching consequences.
The Canadian Government Offers "Bail-In" Regime, Prepares For The Confiscation Of Bank Deposits To Bail Out Banks
Submitted by Reggie Middleton on 03/30/2013 10:12 -0500It's not just Cyprus, and no - it's not just Canada either. I'm preparing a list of specific banks that I have 1st hand knowledge that would prevent me from keeping my money in them. Get "Cyprus'd"!!!
Banks Win Again As Judge Tosses Antitrust Claims In Libor Lawsuit
Submitted by Tyler Durden on 03/30/2013 10:12 -0500
With all the recent chatter about an overhaul and dismantling of Too Big To Fail banks (spoiler alert: it will never happen, but it will take a lot of theater before that is made quite clear) many can be excused for believing the balance of power has shifted away from the megabanks (and their tens of trillions in over the counter derivative "weapons of mass financial destruction" so ably facilitating the Stockholm Syndrome of global mutual assured destruction with each passing day) and in the favor of the people, represented by the legislative and the judicial. Last night we got a quick reminder that absolutely nothing has changed in the true lay of the land, that the adjusted golden rule is still in place (yes, the banks still have all the gold and set all the rules), and that banks are still the undisputed rulers of the land when U.S. District Judge Naomi Reice Buchwald agreed to dismiss claims that the 16 banks targeted by various LIBOR lawsuits broke federal antitrust laws. In so ruling, the potential cost to the banks from an adverse overall resolution would be crippled. The ruling also is likely to reduce the financial inventive for new plaintiffs to join investors, cities, lenders and other parties that have already filed lawsuits. In brief, the banks won again just when it mattered, just when it seemed they may, for once, be on the defensive, and just when the concept of accountability and responsibility for years of conspiratorial and criminal collusion to manipulate a rate impacting hundreds of trillions of IR-sensitive instruments, was about to rear its ugly head. Because in the New Normal crime and punishment is simply a book by Dostoyevsky.
Cyprus' Firearms Laws
Submitted by Tyler Durden on 03/30/2013 09:18 -0500"Cyprus has strict gun control. Private citizens are completely forbidden from owning handguns and rifles in any calber, even .22 rimfire. Only shotguns are allowed, and these require a license. Shotguns are limited to two rounds."
On Behaving Badly
Submitted by Tyler Durden on 03/30/2013 09:09 -0500
When governments begin doing things that are extreme and outside of the normal patterns of behavior then it is not a stretch to say that they are in trouble. They are responding this way because they are in a critical and perhaps life threatening situation. They do not tell the truth about sovereign finances and cover up everything at the ECB but they must be looking at the real numbers and experiencing some sort of epileptic fit. I would say that you can now speculate in Europe. I would say that you can bet in a manner no different than a casino. Actually no; I would say it is worse. You can put your money down and then the dealer can say, "New Rules, Game Change; all the money on the table is required for the House and it is now mine." If you had suspicions before; they have been confirmed. Anything, everything can and might be done and then justified by the unwillingness of the nations in Europe to pay for any more of a troubled country's difficulties. Whatever boundaries that existed have been breached. There is no Law, no fences and no limits. First Greece and now Cyprus and Pandora has raised the lid on her Box.
Currency Positioning and Technical Outlook: Clouded by Fundamentals
Submitted by Marc To Market on 03/30/2013 07:48 -0500An oveview of the technical condition of the major currencies. Offered as a compliment to macro analysis.
March 29th
Guest Post: The Chess Game Of Capital Controls
Submitted by Tyler Durden on 03/29/2013 20:31 -0500
On the surface, it may seem innocuous for Germany to move some pallets of gold closer to home. The Bundesbank said the purpose of the move was to "build trust and confidence domestically, and the ability to exchange gold for foreign currencies at gold-trading centers abroad within a short space of time." It's just satisfying the worries of the commoners. What your friendly government economist doesn't reveal and the mainstream journalist doesn't report (or doesn't understand) is that in the event of a US bankruptcy, euro implosion, or similar financial catastrophe, access to gold would almost certainly be limited. If other countries follow Germany's path or the mistrust between central bankers grows, the next logical step would be to clamp down on gold exports. It would be the beginning of the kind of stringent capital controls Doug Casey and a few others have warned about for years. Think about it: is it really so far-fetched to think politicians wouldn't somehow restrict the movement of gold if their currencies and/or economies were failing? Remember, India keeps tinkering with ideas like this already. What this means for you and me is that moving gold outside your country – especially if you're a US citizen – could be banned.
Congress Passes “Monsanto Rider”, Pushing Genetically Modified Foods Onto Our Plates
Submitted by George Washington on 03/29/2013 20:14 -0500… And Stripping Courts of Power
And Scene: Big Cypriot Depositors Facing Complete Wipe Out
Submitted by Tyler Durden on 03/29/2013 19:47 -0500
9.9%? 30%? 60%? 80%? Nope - according to the latest from Reuters, the cash-on-cash return to all uninsured depositors in the healthy, i.e., only remaining big Cyprus bank, will be a big, fat doughnut.
North Korea Says It Enters "War" Against South Korea, And North Korea Kaption Kontest
Submitted by Tyler Durden on 03/29/2013 19:07 -0500
Ordinarily this would be Good Friday humor (unless we are very wrong, and it turns out to be Good Friday Global Thermonuclear War) because when one cries wolf a few too many times, this is what happens (from Yonhap):
"North Korea announced Saturday that it has entered a state of war against South Korea. In a special statement, the North said it will deal with every inter-Korean issue in a wartime manner."
And... nothing. In fact, if the market was open the ES would likely ramp limit up on the non-news. By now the world is so numb to the constant provocations by North Korea's confused leader, who is desperate to be finally paid off as nuisance value by the Western powers, that the most he can extract from anyone is laughter when one wonders if the iMac sitting on the desk of glorious leader wasn't hacked by some brand new FBI-launched virus issuing world war 8-Ks and press releases (although with the Ethernet cable unplugged, "no risk" of that as Geithner would say).
Guest Post: Big Government: An Unnecessary Evil That Should Be Abolished
Submitted by Tyler Durden on 03/29/2013 18:30 -0500
There are two types of people in this world; those who worship the ideal of centralized command authority, and those who do not. Those who value freedom regardless of risk or pain, and those who value slavery in a desperate bid to avoid risk and pain. When I consider the ultimate folly of man, in the end I look to the meek and unquestioning masses who strive to avoid risk, because it is they who always end up feeding the machines of war, despair, and tyranny. The power thirsty halls of elitism surely instigate and manipulate the tides of this wretched ocean of quivering souls, but ultimately, the weak-hearted and weak minded make all terrible conquests possible. They live by the rule of fear, and their fear drives them to seek control; control of their environment, control of others, and by extension they believe, control of the future. They attempt to mitigate their overwhelming fear by containing the world and sterilizing it of everything wild, untamed, and unknown. They dream of a society of pure predictability, and zero responsibility. They are willing to sacrifice almost anything to attain this position of artificial comfort. The concept of “big government” appeals to such people for many reasons...
Who Said It? "We Must Buy Government Bonds"
Submitted by Tyler Durden on 03/29/2013 17:25 -0500No, it wasn't Ben Bernanke or Alan Greenspan, it wasn't Jean-Claude Trichet or his successor Mario Draghi, nor was it Mervyn King, Carney, Shirakawa, or Hildebrand. The answer, as shocking as it may sound, was...
Guest Post: The Knowledge Economy's Two Classes of Workers
Submitted by Tyler Durden on 03/29/2013 16:00 -0500
Setting aside that our economy is by and large organized to benefit a State-financial Elite and the technocrat Caste that serves them, let's consider the two classes of worker in what Peter Drucker labeled the Knowledge Economy in his 1993 book Post-Capitalist Society: The Marxist class division of labor vs. capitalist/management no longer adequately describes the new economy, as knowledge workers own "the means of production" which is first and foremost knowledge. Since the new economy is no longer characterized by capital vs. labor, it is a post-capitalist economy. Knowledge workers are a minority of the workforce; the majority are service workers, either skilled or low-skilled. Since the service workers own and leverage less capital (knowledge), their ability to create surplus value and thereby demand high wages is intrinsically lower than the knowledge workers. This creates a structural tension, as society has to establish a way to maintain the wages of the service workers in an economy where the value and income they can generate by their labor is capped.





