Archive - Jan 10, 2010 - Story

And the good old dollar pounding, gold spiking, futures gunning Sunday night action that we all know and love, is back.

While we at Zero Hedge observe and lament the passage of America from a once great superpower into a second-rate banana republic, on occasion we do witness that rare example, somewhere in the world, of complete and utter political and economic lunacy that inspires us to think, "wow, not even Bernanke could have thought of this... yet. "After devaluing the currency on Friday, Venezuelan president Hugo Chavez "threatened to deploy troops and expropriate businesses that increase their prices." This is just one such example.

In this oldie but a goodie, Ron Paul hammers home the point of why the Federal Reserve needs to finally be accountable and transparent, despite the desires of Barney Frank, Wall Street, Ben Bernanke and all the current failed system's apparatchicks who will stop at nothing to perpetuate the broken status quo. For regular readers none of this should be news. For everyone else, this 1 hour program is a must watch. Clip courtesy of Fora TV and the Cato Institute.

If you love watches, the measuring of time, horology, the art and finesse of mechanical engineering, keep reading. You fancy in the perceptions of prestige and exclusivity with cunning attention and the celebration of style and detail- click and read on. Everyone else, go back to having a great weekend.

After posting a record crude-oil import month in December, as well as the second highest iron-ore import month in history, China's program economy is roaring back to life, even if the imports are actually sitting in full warehouses, used to build empty cities that consume negative electricity, make washing machines that never launder anything except the government's flawed economic statistics, and create cars that somehow use up ever-less gasoline. Of course, when the government has trillions in increasingly worthless excess dollar foreign reserves that have to be used up for something, it is no wonder that the Chinese government is buying anything and everything it can stockpile, and that can't be devalued by Tim Geithner, hand over fist. As for exports: courtesy of the dollar peg, which makes China's exports as cheap as the US' (assuming the latter had much of anything to export besides financial innovation), China had no shortage of counterparties to purchase its $1.2 trillion in 2009 exports. Yet despite all this, China's trade surplus plunged a record $100 billion, or 34%, to $196 billion from 2008's $296 billion.

Page 17 of the latest Adrienne Shapira/Goldman Sachs retail cheerleading report finds the smoking gun of the end of the recession: A "group of Spanish tourists made the trek to fill their luggage with merchandise from ANF and Hollister." Well, if the Spanish tourists are stuffing child porn endorsed trinkets down their carry-ons, then all is well. Where does one buy these retailers who are currently (and far into the foreseeable future) experiencing negative margins thanks to -80%/-90% and, who knows, in many cases five finger, discounts (you didn't think the rampant hustle and bustle this Xmas season was all AmEx and CapitalOne funded, did you).

The latest AIG fiasco may well be the straw that breaks Geithner's "public service" back. The question of Tim's involvement in the purposeful cover up has now attained epic proportions as even the White House claims the Treasury Secretary and former NY Fed governor had recused himself and was not involved in the discussions of the biggest bailout in US history. By doing so, the White House has transferred an ever greater amount of political risk to itself by continuing to back Geithner at increasing costs to its popularity. Whether or not Geithner was intimately involved procedurally seems irrelevant: he certainly was aware of the broad strokes and was thus complicit by implication. Nonetheless, one of the allegations that is circulating the blogosphere is that the handwriting on the "smoking gun" cover up memo belongs to Timmy. While we do not have a certified graphologist in our ranks, this assumption appears to be patently false.