Archive - Aug 7, 2014 - Story

Filed in the "are you kidding us" folder... Chinese exports rose an astounding 14.5% YoY in July (the biggest surge since April 2013 and double the 7.0% YoY expectations). Chinese imports plunged 1.6% to 4-month lows, dramatically missing expectations of a 2.6% YoY gain. These miracles of goalseek.xls and fake trade invoicing left the Chinese Trade Balance for July at $47.3 Billion - its highest ever (ever) and almost double the $27.4bn expectations. In the midst of collapsing European economies, plunging Russia, and stumbling 'hard' US macro data, the Chinese government would have us believe the world (net) bought the most stuff ever from them in July...

In an effort to prevent genocide, President Obama has authorized US military action in Iraq "to protect Americans":

*OBAMA SAYS HE'S AUTHORIZED TARGETED AIR STRIKES IN IRAQ
*OBAMA SAYS HE'S AUTHORIZED HUMANITARIAN DROPS FOR REFUGEES

Global equity markets and Treasury yields are tumbling, oil and gold are up. President Obama concluded: "Today, America Is Coming To Help Iraq"... Again! Full speech below...

As Liberty Blitzkrieg's Mike Krieger reports, this is what activists created using lasers on the U.S. Embassy in Moscow. No further comment necessary.

Everyone knows that New York and California have the largest concentration of uber-wealthy Americans, however what may be less known is who the richest people in the other 48 or so states are. So, without further ado, here is the full map of all the top BSDs in America, broken down by state of residence.

Ten years ago, when Europe was successfully pretending it is solvent for the benefit of German exports and Greece was happily masking its budget deficit disaster with Goldman Sachs currency swaps, the Olympic flame was about to light up the Athenian night sky. As BBC reports, the return of the Games to the Olympics' spiritual home was widely hailed as a success at the time. Now, not so much and most Greeks view the Athens Olympics with anger as a contributing factor to the country's economic catastrophe. The Games cost almost twice their projected budget, with organisers not opting to use any temporary, collapsible venues, as other host cities have done.

We frequently see stories telling us how well the United States is doing at oil extraction. The fact that there are stories in the press about the US wanting to export crude oil adds to the hype. How much of these stories are really true? A major concern with falling per-capita energy consumption it that the financial system may soon reach limits where it is stretched beyond what it can stand. The economy needs energy growth to grow, but the economy is not getting it.

The West's leaders are full of lawyers, Putin is ex-KGB. If ever there was an example of him playing chess while the West plays checkers, the following chart is it. Despite Western protestations that its sanctions will hurt Russia more than Europe this morning, one look at Europe's huge net trade balance with Russia for food and it's clear who is really going to feel the pain. As Martin Armstrong noted previously, "Putin has responded to [Western] sanctions as any really smart chess-player would - you get the supporters of your adversary to jump-ship." What better way to crack the 'stop-Putin' alliance than to force Europe into trade deficits and squeeze their economies (especially Germany)?

For fast-food workers (and their unions) of the world, the following image is truly terrifying... As People's Daily China reports, the first restaurant featuring robotic waiters and chefs has opened in Suzhou, Jiangsu...

For the second time this year, Italy experienced a slump of its gross domestic product by 0.3% year on year. The economic data is so bad that Italy's economy is the smallest in 14 years. The advantage of Italy and its legendary corruption has been its equally inefficient government that has allowed the people to just ignore it and get along with life in the real world of the underground economy. The solution for Italy? The politician’s dream. Brussels want to take away the right of the Italian people to vote on anything meaningful. Italy is where the Republic was born. The land that had inspired the American Revolution against monarchy is now itself surrendering the last vestige of democratic process yield to the growing tyranny of Brussels under the pretense of saving the Euro.

In recent weeks, Bloomberg Businessweek reports, President Obama and congressional Republicans have begun to offer the same simple-sounding solution for dealing with the flood of children crossing the U.S. border alone: Send the kids home. But with tens of thousands of them churning through the system, some just toddlers, the logistics are overwhelming. Since October, more than 57,000 children have arrived by themselves, most from Central America (as we show below), and 22,000 more have been detained with their parents (mostly children under 12). The American people appears considerably more concerned than the politicians - a Reuters/Ipsos poll shows 70% of Americans - including 86% of Republicans - believe undocumented immigrants threaten traditional U.S. beliefs and customs.

Despite President Obama's dictating that Russia is increasingly "isolated," it appears they have found a whole new set of friends to play with in the global trade sandpit. In retaliation to Western sanctions, Putin yesterday unveiled a total food import ban from all sanctioning nations, and, just as the BRICS created their own 'IMF-lite' away from Washington's prying eyes, Russia plans to substitute banned goods with not just domestic supplies but imports from Latin America, China, and several other nations. Agriculture Minister Nikolai Fedorov said "no food shortages are expected," but more isolation for the West...

While we await the latest nationally televized appearance of the teleprompter telling Obama just what the US is doing in Iraq at some point over the next 60 minutes, there are conflicting reports about what may or may not be happening in Iraq right now. On one hand there appears to be confirmation that the US has begun airdropping humanitarian supplies to the thousands trapped in the Iraqi mountains, as we earlier reported would likely happen. On the other hand, the NYT also blasted that the US is now also bombing ISIS targets in Iraq.

Moments ago Bloomberg reported, citing Defense minister Rob Nicholson speaking in Trenton, Ontario, that Canada, a NATO member, will send military equipment to Ukraine. Ukraine will in turn supposedly use supplies to protect eastern border Nicholson speaking to reporters, although perhaps one should ask ISIS where US military equipment that was meant for Al-Qaeda, pardon, Syrian rebels to dethrone Assad ended up...

High-Yield bonds funds saw record outflows of $7.1 billion this week - the fourth week running - as the slow-motion train crash in credit starts to accelerate. As Forbes reports, the huge redemption blows out past the prior record outflow of $4.63 billion in June 2013. The full-year reading is now deeply in the red, at $5.9 billion, with 43% of the withdrawal tied to ETFs. Simply put, everyone in the bond market knew 'not' to sell because liquidity is simply not there; but game theory's first mover advantage finally broke as retail investors run and create a vicious cycle of 'liquid' ETF selling forcing 'illiquid' underlying bond selling... just as we warned here and here. Why should equity investors care? See chart below...