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On the Edge?
Timmy G. is in Europe urging the financial leaders to, “ Do it Big
and do it Fast!”. I think this was typical Dumb Tim. He is
setting this up to come to a boiling point ASAP. That is the worst
possible outcome. There are no short-term solutions to Europe’s
problems. The EU has to buy itself some time to try to make adjustments.
We need some cooler heads in charge. Instead "Cowboy Tim" starts
shooting off a six-gun. As with most gunplay someone is going to get
hurt.
The calendar is working against the Euro. With all that is going on I
think positions are already light for the US interbank players. There is
always risk for something to happen on a weekend. This weekend is no
exception. To add to the problem is the three-day bank holiday. Based on
past experience I would expect that the ‘commercials’ are likely to get
involved in the market before the weekend begins. In this case I am
referring to the hundreds of big time CFOs around the globe who have
corporate Euro exposures. Almost all of them have natural long positions
in either/or cash, inventory, earnings and profits, inter-company
accounts and fixed assets. This crowd has been hearing the “rumor”
of a change in Chinese reserve management all afternoon from the FX
Corporate desks. They will look to lower risk before the weekend.
Of course there is no truth to the rumor that China is rethinking its
holdings. It does not work like that. I would expect that China and many
of the other big reserve countries will be reducing their incremental
holdings of Euros for some time to come. That is a significant
difference from big ticket selling. I am sure that there has been CB
selling, there will be more in the future, but not the Chinese. That
does not matter. Just the talk is going to keep the money moving.
NY equities were just a puke-out. That close is going to roll to Asia
and later Europe. A bad day for Euro equities is going to put more
visible pressure on the Euro against all crosses. It does not matter if
this is logical or not. It just works that way.
If you measure sentiment by the talking heads, the markets are
positioned for a “predictable” bounce off recent low levels. A 10-12%
correction often brings that result. But we don’t have Europe blowing up
very often either.
We took out the 110 level on the E/Yen today. I bet we will hear some
silly statement tonight from a Japanese finance official, “A
strong Yen is not desirable, MITI is monitoring market closely”.
This crap talk will not work. But I doubt the Japanese will intervene.
We are playing with E/$1.2150 as Asia opens. There is a big black hole
of uncertainty if we go under 1.21. I can’t imagine that we will not see
this test soon.
The E/CHF is back to 1.4160. There was an explosion of trading a week
ago in this cross. I maintain that the Swiss National Bank intervened
very aggressively when the exchange rate fell to 1.4000. As with the $/E
rate there is nothing blow 1.40. We have never seen that. Therefore by
definition that is a high stress situation. Markets being markets I
think it will have to go back to that 1.40 level just to see if the SNB
is still around.
If the Swiss are not there, get a parachute.
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We can make piss into clean drinking water already (and urea byproducts are actually very useful), and we can burn the shit for fuel or use it for fertilizer. We don't actually need trees anymore apart from CO2 conversion, and that can be done 400% more efficiently per acre by the cannabis sativa plant, which we can also use for fuel, clothing, food, etc. If the whole world (in human population terms) looks like New York or Beijing, we'll have made some real progress, urbanization is far more efficient from a land resources perspective.
Next.
Come on now, he's not an idiot. Malthus has been proven incorrect time and time again. What always saves our asses is technology. We are busy little monkeys and the best and brightests among us come up with some pretty neat tricks like boosting crop yields through the roof, which has kept us going strong. Next up, who knows? Maybe a brilliant, cost effective idea for home gardens that catches on? Maybe a nanotech breakthrough that lets us convert grass and sticks into something more edible? Like that feeding tube in the Matrix. lol I don't know, but it's out there somewhere. And eventually we are hitting the stars at some point. My kids going to Mars baby!
If you think this way, you do end up going to war "over resources." But you've got it backwards. Humans are a resource, when educated to be productive and innovative. The cost of the raw materials that you refer to as resources, on the other hand, tends to descend over time, in real income terms. By the time we are done with it, our still extensive petroleum reserves will be just about worthless.
+1, Very nice
China is just as shaky as the rest of us. They make some smart moves, but they are dependent on exports to keep the restless hordes at bay. When the big boys have money problems all the rules go out the window as Europe has shown. Our next Sec. of Treasury will be laughing at them. You want money, fellas, digital or paper? We got all you could ever want. We never promised we'd pay you back with anything else. Cause, gee whiz, Americans can actually turn cotton into clothes, iron into steel, etc. if we absolutely have to.
Absolutely. Chinese think long-term, in decades or centuries, not years. Western "long-term" thinking is for 4 years, till next elections.
Anyway, when we´re already "on the edge", let´s be on the edge:
http://www.youtube.com/watch?v=PoRuX94DErE&feature=related
"They" were thinking super long term when they decided on their one child policy several decades ago. Now they can look forward to be becoming the most geriatric society on the planet well before they can hope to become the richest. The trick is to work out who the "they" is. Some chinese will do very well, but just some. It is a one-party rule dictatorship, so guess which of the chinese will do well. The rest will continue to suffer.
I wonder who´s buying 15 million automobiles per year(more than in US), if all of them are so poor and downtrodden, except for few chosen ones.
On one child policy:
An african woman has 6 children on average, but it doesnt seem to make Africa any richer. If I have to choose between "geriatric" Japan/China or young and "dynamic" Africa, I´ll choose the geriatric club for sure.
kaiten,
China is backing off the ONE child deal...........they have realized that which we did not.
Fiscally they are neither Africa, nor Japan..........
I agree w/ the Africa statement,,,,,,the world has allowed mass murder, and starvaton there for decades............Send a $10.00 for a Malaria net, and save a child......for what starvation, HIV, a Machette, or pick one?.
Never good historicly speaking for a group to be that overweight testoserone wise--apparently makes them cranky and warlike--like I get after pissing off my better half and goin' lonesome for a week!
I´m not approving one-child policy, quite the opposite. I believe anyone should decide how many babies he wants by himself. I´m just saying that judging a country by just one demographic measure is absurdly simplistic. Should this "logic" apply then african countries are the richest ones and Japan the poorest.
NO, people should only have the amount of children they can AFFORD. I am sick of paying for everyone else's children. And last time I looked, human population is still growing, but the Earth is not. Bacteria in a petri dish.
I agree, but you can't blame people for doing what they do, when Big Brother (Big Daddy?) is there to bail them out with welfare, food stamps, free daycare, etc. Like every other instance of fed gov meddling, it creates a moral hazard. Put slightly differently, whatever the fed gov subsidizes, we get more of. It's that simple to me.
Like the old management saying: "You get what your reward, not necessarily what you want".
More than 24 million Chinese men of marrying age could find themselves without spouses in 2020, state media reported in January 2010... Not good.
What's that I hear? Oh, just a mass exodus of gay men from San. Fran. heading to the airport... Go back to what you were doing
Makes for a large standing army.
They just need to legalize gay bars.
Okay, it's much more serious than that. Hmm. That's a lot of cannon fodder for WWIII.
Let's start a nuclear war:
http://www.youtube.com/watch?v=Orp9qCaj8Bw