Former CIA analyst Michael Scheuer appeared on CNN and told his lovely blonde and brunette anchors the truth about what is really happening. The hilarious Stepford Wives reaction and the unprecedented cognitive dissonance the ensues is worth the price of admission.
In what is either a delayed April Fool's report, or its latest exercise in rhetoric the IMF asks the humorous question: "An Analysis of U.S. Fiscal and Generational Imbalances: Who Will Pay and How?" The obvious answer is naturally the Fed. The unobvious answer, according to the IMF, is the impossible: a slashing all of USSA's entitlement benefits by a whopping 35% combined with a hike in all tax rates. From the IMF: "This paper updates existing measures of the U.S. fiscal gap to include federal laws up to and including the mid-December 2010 federal fiscal stimulus. It then applies the methodology of generational accounting to establish how the burden of adjustment required to attain fiscal sustainability is shared across generations. We find that the U.S. fiscal and generational imbalances are large under plausible parametric assumptions, and, while not much affected by the financial crisis, they have not improved much by the passing of the Final Healthcare Legislation. We find that, under our baseline scenario, a full elimination of the fiscal and generational imbalances would require all taxes to go up and all transfers to be cut immediately and permanently by 35 percent. A delay in the adjustment makes it more costly." Such drama: have these people really not heard of the Fed. What is rather shocking is that Larry Kotlikoff, who has made it all too clear the US is bankrupt, was used as a consultant: "We are extremely grateful to Lawrence Kotlikoff who acted as a consultant providing unique inspiration,
guidance and supervision." Are massively dissenting voices now credible sources of information? What next: Fed white paper citing Zero Hedge?
Another day, another potential NYSE Chinese fraud. Muddy Waters starts coverage on DGW with a Strong Sell and a $1.00 target price.
In an absolute stunner of an announcement Bank of Countrywide Lynch's top notch head of economoplagiarism follows in Jan Hatzius' coattails once again and lowers Q1 GDP. All of Wall Street will promptly follow as it always does.
Atlanta Fed's Lockhart is the first Fed talking head on the wires today advising the general public to, gasp, spend: "A less consumption-dependent economy will help rebalance the country's external accounts—the trade and current accounts. It's unlikely and even undesirable that there be a drastic shift away from consumption, so less American consumption will not fix the global imbalances.[sic]" In other words: 1) max out your credit card 2) .... 3) profit.
No Inflation? In 1996 Slick Willie Raised $42.5 Million In Campaign Receipts; In 2011 Obama Plans To Raise $1 BillionSubmitted by Tyler Durden on 04/04/2011 - 09:09
A curious factoid: back in 1996, Bill Clinton rasied a total of $42.5 million in campaign receipts. In 2011, Barack Obama is expected to raise up to $1 billion to run his reelection campaign. A nearly 25-fold increase. Ironically, the 15 year CAGR on the price for the presidency follows the price of silver almost tick for tick. Coincidence?
Literally moments ago, Barack Obama tweeted the announcement of the start of his 2012 campaign. In a surprise to nobody in particular, the president stated that he plans to file the necessary papers with the Federal Election Commission today in order to begin campaign fundraising, further tweeting: "While I stay focused on the job you elected me to do, the work of laying the foundation for our campaign must start today." Perhaps this finally means that the USD is due for a bounce as the concerted effort at destroying the US currency will be slightly delayed among all the takes for various campaign clips like the one below. As for his competition, a poll by Farleigh Dickinson university has the President outperforming most competitors except for Mike Huckabee, with whom he is locked in a dead heat: "The president steamrolls former Alaskan Gov. Sarah Palin by a 20-point margin, 54%-34%. The president also wins easily - 48%-34% - over the only major Republican to have formed an exploratory committee for the 2012 election, former Minnesota Gov. Tim Pawlenty. And the president handily beats the former Speaker of the House, Newt Gingrich, by 15 points, 52%-37%. The president runs even with former Arkansas Gov. Mike Huckabee 46%-46% and about even with former Massachusetts Gov. Mitt Romney, 44%-43%." Of course, what happens to Obama's reelection chances is directly proportional to just three factors: jobs, the price of gas, and the stock market. Alas, while the jobs number is improving courtesy of the continued exodus of disgusted former workers from the workforce, the latter two factors are now mutually exclusive, and any further gains in the RUT will necessarily come at the expense of further cuts in affordable transportation distance, and vice versa, which naturally leads us to the question of what Goldman will order its subordinate at the FRBNY Bill Dudley to do: as usual it all boils down to this: "To QE or not to QE. That is the question."
And so the real goal of the Libyan "No Fly Zone" succeeds: Reuters reports that the Libyan rebel alliance, which already has its own central bank and supposedly fiat printing machines, is about to sell its first oil cargo in the coming week."The agency said Liberian-registered tanker Equator was due to arrive in the rebel-held eastern Libyan port of Tobruk on Monday to load a cargo of Serir/Mesla blend crude oil. The agency quoted Wahid Bougaighis, head of the newly established oil company, as saying: "They are coming for sure because there was a contract signed already."" It remains to be seen how K-Daf feels about honoring contracts signed by insurgents. In the meantime, the chocolate lovers lobby is finally stirring about imposing a comparable No Fly Zone in Ivory Coast. You know, for human rights violations.
The debate over the future of QE2 continues, this time with dovish comments out of NY Fed President Dudley on Friday. Economic releases are light today after Friday’s positive labor data. Look ahead to inflation numbers later in the week with PPI on Thursday and CPI on Friday. We are now experiencing a slew of firms downgrading growth forecasts in FY2011, which should put even more pressure on the job market to drive Fed policy. The IMF has officially denied any reports that the organization had pushed for a haircut on Greek sovereign debt. Euro zone PPI increased 0.8% MoM v a revised down 1.3% prior and 6.6% YoY v a revised down 5.9% prior. Food and energy prices led the increase, but the rise was seen across most goods. Libya’s conflict moved to negotiations as rebels called for a cease fire on Friday. Reports out yesterday indicate that two of the Libyan leader Qaddafi’s sons are calling for an end to the conflict, proposing a transition to democracy that would push their father out of power. A breakdown of Japan’s Tankan manufacturing survey released this morning showed that expectations for the sector are negative with confidence dropping to -2 this June from 6 in March.
- Goldman lowers Q1 GDP, sees rest of year outlook as "messy: (Zero Hedge)
- GOP Aim: Cut $4 Trillion (WSJ)
- Trichet Seen Burying Ailing Nations With Interest-Rate Rise (BusinessWeek)
- ECB criticised over expected rate rise (FT)
- Important for China arbs: BOC HK Cuts Yuan Deposit Interest Rate (Bloomberg)
- In Tripoli, Growing Murmurs Of Dissent (WSJ)
- Inflation Surge May Cause Hike in Won, Rates (Korea JoongAng)
- Us Foreign Policy "Shocker": U.S. Shifts to Seek Removal of Yemen’s Leader, an Ally (NYT)
- Next Problem for Oil: Nigerian Elections (WSJ)
- Geithner Says Strict Policy on Currency Hurts China (NYT)
- China closes half the nation's dairies (Telegraph)
- Ireland to Push for Better Bailout Terms (WSJ)
At this point it is certain: the Fed is determined to baffle them with bullshit.
Back On March 14th, Zero Hedge first disclosed data originating from the SPEEDI (System for Prediction of Environment Emergency Dose Information) database, which showed that while radiation in the Ibaraki prefecture were about 30 times above normal, the core affected regions were "Under Survey." In subsequent posts we compared the "Under Survey" category to one step below what the BLS does on a daily basis - i.e., make up stuff. But at least in Japan, they did not even make data up: they just refused to release it. Well, we now have official confirmation from NHK that once again our well-grounded skepticism (and cynicism) was as usual absolutely spot on: "It has been learned that the Japanese government withheld the release of
computer projections indicating high levels of radioactivity in areas
more than 30 kilometers from the troubled Fukushima Daiichi nuclear
power plant. The estimates were made on March 16th following explosions at the plant by an institute commissioned by the government using a computer system called SPEEDI. The system made its projections on the assumption that radioactive substances had been released for 24 hours from midnight on March 14th, based on the available data." Of course, had the disastrous SPEEDI data been reveled in time, not even the hundreds of billions (or trillions in Yen) of emergency money pumped by the BOJ, would have been able to prevent a complete market disaster. In other words: Nikkei 1; Human Life 0. In the meantime we wonder what superpowers the X-Man from the affected regions will soon develop.
Silver for immediate delivery has gained another 1.7% to $38.50 an ounce, the highest level since February 1980, the year silver reached a record of $50.35/oz. An ounce of gold bought as little as 37.32 ounces of silver in London today, the lowest level since September 1983. Silver has come out of backwardation and returned to contango with longer dated future prices again higher than nearer month contracts and spot for delivery (see table below). This suggests that default on the COMEX, as warned of by some analysts, is not imminent and the tightness seen in the physical silver market may have abated somewhat. However, the Dec12 contract trading at only cents over spot for delivery (less than 10 cents) suggests that tightness remains. Given the degree of tightness in the physical silver market, silver may return to backwardation sooner rather than later. The latest COT report shows speculative long positions, or bets prices will rise, outnumbered short positions by 37,139 contracts (see news and chart below). This is a level of net longs by hedge fund managers and other large speculators that was seen as long ago as 2002.