Archive - Dec 24, 2010 - Story

Posting on Zero Hedge over the next 24 hours will be sporadic and infrastructure contingent. Please use this forum for any urgent news, notifications, or pent up venting. Regular posting will resume shortly. Happy holidays to all.

Update [sacrilege]: I'd like to take a moment to thank the staff -- particularly boney -- at portlane. Their continued support has been phenomenal. Also: Merry Christmas.

Sovereign Man, Simon Black, writes in from Santiago Chile, shares his latest observations on gold and provides his two most recent recommendations for those who have decided to expatriate and are now just contemplating which country to call home. In summary: "I would recommend the country for pioneer expats who don't mind putting up with squalor and the lack of amenities... but Cuba makes up for it in other ways, like warm weather, gorgeous women, great salsa culture, and zero crime against foreigners." It will be the most supremely ironic end of the US empire if those disgruntled with the regime end up defecting to the one country which currently best exemplifies Regan's "evil empire. "

Calling for a "bank run" in public will possibly become a criminal offense. Ministers Opstelten of Security and De Jager of Finance are preparing a proposal for a new law. They want to be able to penalize people who are openly calling for a "bank run" a maximum of 4 years or a fine of 19.000 euro. According to the ministers a bank run can seriously endanger a bank.

Three weeks ago when we noted the 30th consecutive outflow from US-based equity mutual funds (now at 33 straight weeks), we said: "America's love affair with stocks is over, has bypassed the marriage stage and gone straight to the bitter divorce." Today, we are happy to see that the the NYT's Floyd Norris for repackaging our metaphor in a slightly more palatable fashion: "The love affair of American investors with the stock market appears to have ended." His piece in today's NYT "For U.S. investors, the glow is off domestic stocks" will not be news to anyone who follows our weekly report on ICI data: "The year now ending will be the fourth consecutive year in which mutual funds that invest primarily in American stocks experienced net outflows of funds, meaning that investors as a group withdrew more money than they put in." And yet stocks continue to ramp higher, in big part due to the rapid increase in NYSE margin interest which means the bulk of investors are buying stock increasingly on leverage, but still the question to just who continues to do the actual holding remains unanswered. Indeed, only a few people, Charles Biderman among them, have answered with the response that everyone knows is true, yet most are afraid to utter.

Promptly after those two cuddly bears explained how the JP Morgue is manipulating the silver market, and the xtranormal video went viral, forcing the FT to release an indemnification that "according to sources" JPM had covered a major portion of its silver short (only to subsequently end up with 90% control of other metals markets), here they are back, explaining in Part 2 of the series just what the next steps in the unwind of the biggest metal manipulation scheme will look like. The kicker: a JPM insider has told one of the bears that there is no commercial silver left, "it's all smoke and mirrors, and the CFTC can do nothing about it other than pray." Other topical items explained: silver backwardation, that there are two commissioners at the CFTC on the JP Morgue's payroll, the BIS' fractional gold system and the usage of side pockets for sovereign gold, and pretty much everything that ties the loose odds and ends in the PM manipulation story.

Individuals do not always, if ever, exercise their freedoms so as to promote order in everyone’s lives. On the contrary, in seeking order in their own lives, individuals tend to impinge upon the lives of at least some others, if only because, in their efforts to cooper-ate with one party – i.e., to exchange one or another good or service to their mutual advantage – they inadvertently compete with another party, in which case one or the other must accordingly lose. But insofar as this process of exchange promotes the division of labor, resulting in the provision of a wider variety of goods and services that in turn improves individuals’ lot in life, the gains far exceed the losses. For how else could the human species have advanced at all, much less to a stage that was inconceivable little more than a century, or even mere decades, ago? How else could it have harnessed electricity, for example – or invented the locomotive, the telegraph, the telephone, the automobile, the airplane, the computer, the cell phone, email, the World Wide Web, etc. – if not but through this cooperative, if inevitably competitive, process?

RANsquawk Christmas Update - Stocks, Bonds, FX etc. – 24/12/10

RANsquawk European Morning Briefing - Stocks, Bonds, FX etc. – 24/12/10