Archive - Sep 2015

In a startling turn of events, retired General John Allen will be stepping down as special envoy to the global coalition fighting ISIS and will be leaving government employment entirely. President Obama’s hand-picked choice to lead the U.S. in the international effort fighting the Islamic State will call it quits just as the harsh spotlight intensifies scrutiny over questionable decisions by the administration.

For USD investors, the collapse in German stocks has crushed returns to the lowest in 2 years. DAX's collapse this week leaves it closing at Black Monday lows, the lowest since Dec 2014. Perhaps most stunning is German stocks down over 20% since Q€ began...

Just three days ago after looking at the latest CAT retail sales, we asked in stunned amazement "What On Earth Is Going On With Caterpillar Sales?"  We now know the answer. 

"... this time we would see deeply negative interest rates in the US (and Europe). Sweden has led the way, dipping their toe below the water line with their current -0.35% policy rates but there will be more, much more along these lines. For if -0.35% is possible, why not - 3.5% or less? It goes without saying that deeply negative interest rates would be accompanied by a massively expanded QE4 in the US. The last seven years of exploding central bank balance sheets will seem like Bundesbank monetary austerity compared to what is to come."

And the regional Fed survey collapse goes on... Dallas, Richmond, New York, Philly, Chicago, and now Kansas City...

Armed U.S. Drones Alone Killed Twice As Many As Al Qaeda …

With the drop today, the S&P 500 is now down 10.5% from its May highs, re-entering the correction seen on Black Monday. This now leaves the key benchmark lower since QE3 ended and unchanged since May 2014.

It's time to trade in your Jag, Mercedes, BMW (and maybe your Prius, Volvo, Lexus, etc.) before the Days of Rage start. The resistance will take the form of subverting the signifiers of wealth that exemplify the few who have benefited so greatly while everyone else lost ground.

If it was Janet Yellen's intention when deciding not to hike rates to stop the surge of the USD against emerging market currencies in hopes of halting the relentless global capital outflows and the resulting Quantitative Tightning, to avoid a new global currency crisis... she failed.

It just keeps getting worse, and worse, and worse...

At 522,000 new homes sold (SAAR) in August - the highest since February 2008 - it is perhaps worth noting that this 'recovery' remains 60% below the prior bubble peak. Furthermore, this surge to new cycle highs comes in the same month as existing home sales plunged.

Francis will be the first pope ever to address Congress, and as NY Times reports, a milestone in the journey of the Catholic Church in the United States. Mr. Boehner, a proud Catholic, has invited three popes over 20 years to come to Capitol Hill, with this being his first success. The papal address to the Republican-controlled Congress may make some squirm as Francis isn’t shy about tackling controversial topics or upending conventional orthodoxies about Catholics and politics — a prospect that makes U.S. conservatives especially nervous, given Francis’ insistence on raising concerns about issues such as economic justice, climate change and immigration.

Like on many previous occasions, the Muslim pilgrimage to Mecca once again led to a tragic loss of life in what may be the deadliest stampede in pilgiramge history when at least 717 people died and another 805 were injured.

Perhaps Volkswagen is the best most recent example of "lying when it's important" but as Martin Armstrong, the European Union's leadership (elected and unelected) are the kings of hiding the truth when it matters. As he warns, "if you do not know whom to trust, distrust everyone." The motto of the ECB is plain and simple: why reform when we still have some power? Governments will fight until the last drop of blood is spilled; they assume it will be your blood, not theirs.