Archive - Aug 30, 2013 - Story

If Barack Obama is going to attack Syria, he is going to do it without the support of the American people, without the approval of Congress, without the approval of the United Nations, and without the help of the British.  Now that the British Parliament has voted against a military strike, the Obama administration is saying that it may take "unilateral action" against Syria. Unfortunately for the Obama administration, the world is not buying it.  In fact, people are seeing right through this charade. The following are 25 quotes about the coming war with Syria that every American should see...

In early April, the status quo was exuberant when none other than Goldman Sachs issued a "sell" on the barbarous relic that has become so indicative of the exuberance of central planning. At the time, we were skeptical (to say the least) and, just for extra Muppetting, the bank also suggested its clients buy Treasuries. Well, now that the full details of holdings changes have been released for Q2, it is perhaps clearer than ever before that as the bank was telling its clients to "sell, sell, sell" it was itself "buy, buy, buy"-ing the Gold ETF (GLD) with both arms and feet. In Q2, Goldman Sachs added a stunning (and record) 3.7 million 'shares' of GLD. As Paulson dumped his GLD, Goldman lapped it up to become the ETF's 7th largest holder.

The present picture for the oil price looks increasingly bullish once more. Citi asks, is this a replay of the dynamics seen in the 1970’s? We hope not... but the feedback loop (from oil prices) to the economy and markets is undeniable...

On the eve of the eighth anniversary of Hurricane Katrina the Greater New Orleans Community Data Center, which has been tracking recovery indicators since the early months after the storm, issued a snapshot of post-Katrina statistics... and the results are mixed. From the good (63% of New Orleans students passing vs 30% pre-Katrina); to the bad (rising adult unemployment and child poverty rates); to the ugly (rapidly collapsing population dynamics reflecting a very 'detroit'-like scenario), it seems there is still work to be done...

Whenever the state decides to remove the mask of decency and show its true, violent self, there is a positive outcome to the predation. Many finally catch a glimpse of the true force that backs monopoly government. Very few will allow this image to change their preconceived notions of the viability of institutionalized mass representation. The targeted harassment of dissenters is indicative of the state’s brash reaction to all challenges. It’s a task of extreme difficulty to pinpoint where the downward slide began. The rise of statism, moral relativism, and total war has undeniably had a negative effect on how individuals view themselves in civilized society. The degree of degeneration varies between areas, but it’s not hard to recognize the causal effect.

When we think of the once-mythical American Express black card, we tend to conjure images of the most fabulously wealthy people in the world plunking one down on the counter to pay for items that cost more than most Americans earn in a year – or possibly even in a decade. The American Express "black" is actually the American Express Centurion Black card and that image is not a terribly far cry from reality...

The magic was the magnificent illusion that money printing increased wealth. It certainly looked that way, despite all the common-sense interpretation that would have you believe that it doesn't. But that's the beauty of a wonderfully performed magic trick. Something impossible seems to happen. You know it can't happen, but it looks like it did, and what's the harm in letting yourself believe? Assuming that the goal is reducing unemployment... it really was a wonderful 50 years. Pumping out money increased the labor force participation rate from about 59% in 1960 to 67% by about 2000 by creating jobs in military procurement, lobbying, and (as we went through successive bubbles) brokerages and finance, government, home construction, real estate sales, retail, etc. Now the losses in manufacturing and primary wealth creation are overwhelming the jobs created in the FIRE economy, and the US looks to be heading back to the golden era of the 50s, with labor force participation back below 60%. Too bad they'll all be low-paying jobs.

While the Dow suffered its worst monthly loss since May 2012, it is actually holding up better than the rest of the US equity indices since Kerry's speech on Monday. With the Trannies down 4% since Kerry, they cap the worst in the last 23 months. Energy outperformed (unchanged) on the week and financials were major losers down 3% but hombuilders were hammered post-Kerry also ending at the lows of the week. VIX closed at its highest in over 2 months with its biggest weekly jump in over 4 months. Away from equities, FX, commodity, and bond markets also turmoiled... The last few minutes saw stocks crater and ramp as illiquidity, month-end, and anxiety left traders (and machines) breathless.

Because we get the feeling Kevin was a busy boy this afternoon...

They are falling like flies... following the British vote not to join Obama in his latest crusade, it s now NATO's turn as Secretary General Anders Fogh Rasmussen tells Dutch TV2 that "NATO will have no role in any military action in Syria." Of course, there's still the French; and as Rasmussen notes, should any retaliatory action take place to endanger NATO member Turkey then the situation may well change. Quoted as urging a political resolution rather than military, and supportive of the UN inspectors, Rasmussen added "A sustainable solution is a political solution. But an international reaction is necessary."

If anyone expected Bernanke to hint at a tapering in daily monetizations for the month of September, they will be disappointed. Moments ago the NY Fed reported that the Fed will inject a total of $45 billion in the market in September, $1 billion less than in August, but certainly not any other more notable amount which would indicate that the Fed would announce and immediately proceed to reduce its daily POMOs to match the reduction in QE (including $40BN in MBS monetizations). So, continuing our long series of POMO shorting warnings,  now that even the Treasury openly admits "it's all POMO", here is the list of 18 trading days on which shorting stocks may be hazardous to one's health.

We are propagandized to assume the existing hyper-structures of our centralized state-cartel economies will deliver us jobs, happiness, wealth, health and financial security. They will not. The following insightful essay is not just a critique of our current centralized economies but an outline of a community-based alternative economy that offers freedom instead of dependence. Though the examples are drawn from the U.K., the dynamics are the same in America and other advanced state-cartel economies.

The headlines come pouring in:

• OBAMA SPEAKS ON SYRIA DURING MEETING WITH BALTIC LEADERS
• OBAMA CALLS SYRIA CHEMICAL WEAPONS ATTACK CHALLENGE TO WORLD
• OBAMA SAYS SYRIAN USE OF CHEMICAL WEAPONS THREATENS U.S.
• OBAMA SAYS HE'LL CONTINUE TO CONSULT WITH CONGRESS ON SYRIA
• OBAMA SAYS HE HASN'T MADE FINAL DECISION ON SYRIA ATTACK
• OBAMA SAYS SYRIA ACTION WILL BE LIMITED WITH NO GROUND TROOPS

So... he hasn't made a decision, but the action will be limited. Is this like the Schrodinger economy where everything is dead if one collapses the Fed's wave function.

White House has declined TV networks request for live coverage of Pres. Obama's remarks on Syria at 230pm.

— Mark Knoller (@markknoller) August 30, 2013

Presented with little comment aside to note that volumes surged as US equities initially dipped and then ripped back to the entirely algorithmically-controlled VWAP level before starting its fade back... Happy Holidays, Johnny 5...