Archive - 2015 - Story

Following yesterday's budget (deficit) and the 'sacrifice-the-people's-comfort-for-the-death-of-US-Shale' plan that we detailed here, it appears market concerns about Saudi Arabia's forward-looking health are rising. As Bloomberg reports, USDSAR 12-month forwards jumped 250pts (the most since December 2007) to 725bps (the highest level since March 1999) implying expectations of a looming de-pegged, devaluation. Perhaps just as worrying is this is the same pattern that played out in August as Yuan weakness sparked HIBOR stress, leading to SAR forward weakness and then US equity market collapse.

James Madison, the father of the Constitution, put it best: “Take alarm,” he warned, “at the first experiment with liberties.” Anyone with even a casual knowledge about current events knows that the first experiment on our freedoms happened long ago. Worse, we have not heeded the warnings of Madison and those like him who understood that if you give the government an inch, they will take a mile. Unfortunately, the government has not only taken a mile, they have taken mile after mile after mile after mile with seemingly no end in sight for their power grabs. All of the signs point to something nasty up ahead.

"We encourage the higherst leadership of the country to inform the people correctly without sugar coating the truth about Chinese invasion of our Exclusive Economis Zone. How can the people unite and pick up the cudgels and fight alongside of you if you hide the truth from us?"

It appears The Establishment has decided to bring in the big guns to dislodge The GOP's nightmare scenario as Donald Trump goes from strength to strength in the polls. Writing in an op-ed for The Guardian, billionaire puppet-master George Soros urges Americans "to resist the siren song of the likes of Donald Trump," adding that "the terrorists and demagogues want us to be scared. We mustn’t give in."

To begin, we need to understand that political correctness is not about being nice. It’s not simply a social issue, or a subset of the culture wars. It’s not about politeness, or inclusiveness, or good manners. It’s not about being respectful toward your fellow humans, and it’s not about being sensitive or caring or avoiding hurt feelings and unpleasant slurs. But what exactly is PC? Political correctness is the conscious, designed manipulation of language intended to change the way people speak, write, think, feel, and act, in furtherance of an agenda. PC is best understood as propaganda.

2015 was the year of considerable FX drawdown as desperate EM central banks attempted to rescue themselves from reality. As Barry Eichengreen noted, "Intervening to support an exchange rate that’s fundamentally overvalued is a fool’s game and a no-win situation, akin to a sovereign attempting to sustain an unsustainable debt burden rather than yielding to inevitable restructuring."

On the heels of the collapse in China 'B' shares last night, and continued stress in money-markets, China weakened the the Yuan fix to its lowest since June 2011 tonight. This has sent offshore Yuan spiralling lower breaking above 6.5700 for the first time since trhe August devaluation's collapse. Chinese stocks are on the weaker side, extending losses, and we now await the money-markets to see if this stress is escalating.

Even though the odds are never in our favor, there is still hope. Not everyone has to make the extreme sacrifice in order to contribute to the revolution. There are thousands of small acts which will weaken the establishment: "Don’t be a slave to debt. Live beneath your means and accumulate some physical silver and gold. Don’t vote for candidates selected by the vested interests. Spread the message of liberty and freedom to anyone who will listen. Think critically. Do not trust your government. Prepare for the inevitable collapse of this rotten, fetid, corrupt paradigm."

Earlier today, a ship carrying over 25,000 pounds (11,000 kg) of low-enriched uranium materials allegedly departed from Iran for Russia, in what was dubbed a key step in Tehran's implementation of this year's historic nuclear accord with world powers. According to John Kerry this was "one of the most significant steps Iran has taken toward fulfilling its commitments." "I am pleased to report that we have seen important indications of significant progress towards Iran completing its key nuclear commitments under the deal," Kerry said in a statement.

Each year more than one trillion dollars goes up in smoke. More accurately, it is stolen from the middle and working classes and shipped off to the one percent. We are talking about the massive yearly bill to maintain the US empire. What can we do to work for peace in 2016? First we must tune out the lying propaganda served up by the US mainstream media. We must educate ourselves so that we can help educate others.

Two weeks ago we said that "those who have savings at US banks, please don't hold your breath to see any increase on the meager interest said deposits earn." We were wrong: some should certainly have held their breath, because as the WSJ reports today, "some bank customers won’t have to wait much longer to reap benefits from the Federal Reserve’s decision to raise interest rates." Some, such as clients of J.P. Morgan, which will begin raising deposit rates for some of its "biggest clients" in January. "Biggest" clients, of course, is a universal euphemism for "wealthiest."

Freedom is one of the most precious and hard-won of all conditions in life. A government applies the removal of freedoms in a ratchet effect; once a freedom has been taken away from a population, it’s rarely returned. Therefore, freedom tends to deteriorate over time in any nation, no matter how idealistically-founded it may have been. None of us can fully escape the more predatory tendencies of governments. We can, however, question their every move and adjust our lives so that the State’s impact on us is minimised.

"Islamic State is invested in the statehood and Caliphate image more so than any other jihadist enterprise. So a formal organization, besides being practical when you control so much contiguous territory and major cities, also reinforces the statehood image."