Archive - 2012 - Blog entry

In about five years the wheels will fall off the cart.

The US dollar's recent losses are being extended at the start of the new week.  The announcement of the details of the Greek bond buy-back scheme has triggered a sharp rally in peripheral bond yields, while the euro area Nov manufacturing PMI is reported at 8-month highs, even if still below the 50 boom./bust level at 46.2.  The euro has completely recouped the knee-jerk losses scored in thin activity just before the weekend when Moody's announced a cut in the ratings for the EFSF, which follows its recent downgrade of France.

"The problem is, if they think they're not doing anything that's wrong, they don't get to define that. The central government does."

The problem with this market is that it can't seem to sell off enough to produce a sustainable rally. There are not enough bears or bulls.

After all, it's about the money. Right?

Right now the world produces more Oil than it consumes each day, and it has for the past 16 months, this trend will only get worse in 2013.

Two critical developments give us clues that the days of Central Bank intervention holding the system together are coming to an end.

“The euro has profound economic advantages and is the most powerful symbol of European integration,” said 11 EU foreign ministers. What were they smoking?

The Bernank is beginning to wind down his "non-bailout" of Europe.  On 12/14/2011 the Chairsatan himself reportedly told Senator Corker that he had no intentions of furthering the US's involvement in the European Crisis. Coincidently , a few weeks later CNBC interviewed Gerald O'Driscoll who is a previous Dallas Fed Vice President, after he released an Op-ed in the WSJ calling out the FED's European bailout.  O'Driscoll is dead on with his claims and his suspicions about Bernanke's reasoning behind going through the FED market arm to lend USD to the ECB.

Desirable areas in Los Angeles County are finding bidding wars and many places are selling for prices last seen during the peak of the bubble. A fierce competition between flippers, foreign money, and households with healthy incomes leveraging low mortgage rates are pushing prices higher. A few readers were sending over some of the recent action taking place in Culver City. A few recounted their tales of open houses and the sense of urgency to purchase a property. The flood of easy money has certainly had an impact on mid-tier and prime locations. Only a two hour drive up north, in California City you can find homes selling for rock bottom prices. This is a trend bearing out in income statistics. It is becoming harder for the middle class to find affordable housing in California. Some have mentioned in zombie like fashion that some areas are becoming fortresses while other areas are left struggling. Let us take a look at some recent data.

The plight of Chinese Homeowners Attempting to Resist Eviction When the Government Wants to Build Something on their Land ...

Chicken race update...