en US & China Stocks Are Plunging After PMI Hits 6.5-Year Low, PBOC Strengthens Yuan Most Since Nov 2014 <p>Following China&#39;s official PMI print at a 3-year low, <strong>Caixin&#39;s PMI collapsed to 47.3 - the lowest sinec March 2009</strong>. Despite another CNY150bn liquidity injection<em> (but the biggest strengthening of Yuan since Nov 2014 and a financial conditions tightening in FX trading), </em><strong>China, US, and Japanese stocks are plunging... <u>SHCOMP -4%, Dow -280, NKY -340</u></strong></p> <p><strong><u>Carnage!</u></strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 448px;" /></a></p> <p>&nbsp;</p> <p><strong><u>China -4%</u></strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 309px;" /></a></p> <p>&nbsp;</p> <p><strong>Dow -280...</strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 386px;" /></a></p> <p>&nbsp;</p> <p><strong>NKY -340</strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 386px;" /></a></p> <p>Japan is now getting worried:</p> <ul> <li><strong>*ASO: CHINESE ECONOMY HAS BIG IMPACT ON JAPAN ECONOMY</strong></li> </ul> <p><strong>Blood on the streets again in China...</strong></p> <p><a href=""><strong><img alt="" src="" style="width: 600px; height: 313px;" /></strong></a></p> <p>&nbsp;</p> <p><a href="">None of this should come as a surprise to anyone as we noted earlier...</a><br /> <blockquote class="twitter-tweet" lang="en"> <p lang="en" dir="ltr">Stop acting surprised <a href=""></a></p> <p>&mdash; zerohedge (@zerohedge) <a href="">September 1, 2015</a></p></blockquote> <script async src="//" charset="utf-8"></script></p><p>*&nbsp; *&nbsp; *</p> <p>And as we detailed earlier...</p> <p><a href="">Having <strong>exposed the culprit for all of its economic and market woes</strong></a>, China is likely going to have problems explaining why its economic plague is still spreading (with <strong>South Korean exports collapsing</strong> and Japanese Capex growth slowing) and China&#39;s <strong>official manufacturing PMI slipped into contraction for the first time in 6 months (to 3 year lows)</strong>. Amid the face-saving clean-air of Parade Week, the appearance of awesomeness must prevail and following the <strong>worst quarter since Lehman</strong>, stocks are<strong> indicated lower</strong> despite having received some &#39;help&#39; into last night&#39;s close. PBOC proxies push &#39;hope&#39; as a strategy for stock stability (<a href="">even as US markets and oil are re-collapsing</a>) as<strong> margin debt drops to an 8-month low</strong> - still double YoY though. <strong>PBOC fixes Yuan 0.22% stronger- the biggest jump since Nov 2014 - as it injects another CNY150bn via 7-day rev.repo.</strong></p> <p>&nbsp;</p> <p>China&#39;s bubonic economic plague is spreading...</p> <ul> <li><strong>S. KOREA EXPORTS DROP BY MOST SINCE 2009, FALLING FOR 8TH MONTH</strong></li> </ul> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p><u><strong>So guess who wil lbe next to devalue!</strong></u></p> <p>*&nbsp; *&nbsp; *</p> <p>But <a href="">having arrested the culprit for all of China&#39;s market and economic woes</a>, following the <strong>worst 3-month slide in stocks since Lehman</strong>...</p> <p><a href=""><img height="303" src="" width="600" /></a></p> <p>&nbsp;</p> <p>And with Parade Week under way, the propaganda continues...</p> <ul> <li><strong>*PBOC ACADEMIC URGES ATTENTION ON STOCK MKT STABILITY: SEC TIMES</strong></li> </ul> <p><a href="">Which, he writes,</a> means <strong>market expectations should be optimistic about the economy as they were during the bull market... even though there seems to disconnect between economic fundamentals and the stock market, while the gap between the link, it is the reflection of the policy</strong>.</p> <p>Which roughly translated means - <strong><u>In China, hope is a strategy.. and if you are anything but hopeful you are arrested.</u></strong></p> <p><u><strong>But then China PMI hit...</strong></u></p> <ul> <li><strong><u>*CHINA MANUFACTURING PMI AT 49.7 IN AUG. - 3 Year Low - The Official PMI in contraction for first time in 6 months.</u></strong></li> <li><strong>*CHINA NON-MANUFACTURING PMI AT 53.4 IN AUG.</strong></li> </ul> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p><em><strong>&quot;Both domestic and external demand are weak,&quot;</strong></em> said&nbsp;<a data-destination="bbgp://people/profile/15893041" data-rte-autocap="false" data-rte-autocorrect="false" data-rte-spellcheck="false" href="bbgp://people/profile/15893041" spellcheck="false">Tommy Xie</a>, an economist at Oversea-Chinese Banking Corp. in Singapore. <strong><em>&quot;Market sentiment is bad and it&rsquo;s too early to say the Chinese economy is bottoming out.&quot;</em></strong></p> <p>&nbsp;</p> <p><u><strong>Don&#39;t forget - Hope fills the gap.</strong></u></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 313px;" /></a></p> <p>So having switched its focus to more economic-growth-focused measures than stock-levitation, $100s of billions later, the economy keeps sliding.</p> <p>Of course, there is always the unofficial Caixin print at 2145ET to baffle everyone with bullshit.</p> <p>*&nbsp; *&nbsp; *</p> <p><strong>There is some good news... </strong>The delveraging continues:</p> <ul> <li><strong>*SHANGHAI MARGIN DEBT BALANCE FALLS TO LOWEST IN EIGHT MONTHS</strong></li> <li>Outstanding balance of Shanghai margin lending fell to 673.1b yuan on Monday, lowest level since Dec. 25.</li> <li>Balance dropped by 1.5%, or 10b yuan, from previous day, <strong>in a 10th straight decline</strong></li> </ul> <p>But then again, we are not sure if we are allowed to mention that. And in any case -<u><strong> just to screw things up completely, China is goping full subprime in the real estate market...</strong></u></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><span>China may strengthen property loosening and <strong>reduce down payment ratio on commercial mortgage loans if property investment remains weak, </strong>analysts led by </span><span>Ning Jingbian</span><span> write in note.</span></p> <p>&nbsp;</p> <p><span><span>Move to<strong> boost mkt confidence in short term,</strong> though real policy effect may be impaired due to caps on housing provident fund loans</span></span></p> </blockquote> <p><span><span>Yeah - because loosening standards and lowering upfronts worked out so well for America&#39;s already inflated housing market.!!</span></span></p> <p>Asian equity markets are not happy...</p> <ul> <li><strong>*JAPAN&#39;S NIKKEI 225 MAINTAINS LOSS AFTER CHINA PMI; DOWN 1.5%</strong></li> <li><strong>*CHINA FTSE A50 STOCK-INDEX FUTURES FALL 1% AT OPEN</strong></li> <li><strong>*CHINA SHANGHAI COMPOSITE SET TO OPEN DOWN 1.5% TO 3,157.83</strong></li> <li><strong>*CHINA&#39;S CSI 300 INDEX SET TO OPEN DOWN 2.1% TO 3,296.53</strong></li> </ul> <p><a href=""><strong><img alt="" src="" style="width: 600px; height: 316px;" /></strong></a></p> <p><a href=""><strong><img alt="" src="" style="width: 600px; height: 312px;" /></strong></a></p> <p>After two days of stronger Yuan fixes, PBOC goes crazy and drastically strengthens Yuan...</p> <ul> <li><u><strong>*CHINA SETS YUAN REFERENCE RATE AT 6.3752 AGAINST U.S. DOLLAR</strong></u></li> <li><u><strong>That is the biggest single-day strengthening since Nov 2014...</strong></u></li> </ul> <p><a href=""><img alt="" src="" style="width: 600px; height: 304px;" /></a></p> <p>&nbsp;</p> <p>We are not sure of the implications yet but it seems like a tightening of financial conditions:</p> <ul> <li><strong>*PBOC SAID TO MAKE BANKS TRADING FX FORWARDS HOLD RESERVES: RTRS</strong></li> <li><strong>*PBOC FX FORWARD RESERVE RATIO SAID TO BE 20% FOR NOW: REUTERS</strong></li> </ul> <p>&nbsp;</p> <p><em><strong>Charts: Bloomberg</strong></em></p> <p>&nbsp;</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="967" height="504" alt="" src="" /> </div> </div> </div> China Equity Markets Housing Market Japan Lehman Market Sentiment Mortgage Loans Nikkei None Real estate Reuters Twitter Twitter Yuan Tue, 01 Sep 2015 03:21:30 +0000 Tyler Durden 512678 at The Oligarch Recovery: Low Income Americans Can't Afford To Live In Any Metro Area <p><a href=""><em>Submitted by Mike Krieger via Liberty Blitzkrieg blog,</em></a></p> <p>We were told we needed to bail out Wall Street in order to save Main Street. Well the results are in…</p> <p><strong>Wall Street has never done better, and Main Street has never done worse.</strong></p> <p>From <a href=";kvcommref=mostpopular">the<em> Huffington Post</em></a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>Low-income workers and their families do not earn enough to live in even the least expensive metropolitan American communities, according to a new analysis of families’ living costs published Wednesday.</em></strong></p> <p>&nbsp;</p> <p><em>The analysis, released by the left-leaning Economic Policy Institute, is an annual update of the think tank’s Family Budget Calculator that reflects new 2014 data. The&nbsp;<a href="">Family Budget Calculator</a>&nbsp;is a formula designed to determine the income “required for families to attain a secure yet modest standard of living” in 618 different communities across the country that the U.S. Census Bureau defines as metropolitan areas. The formula uses data collected by the government and some nonprofit groups to measure costs of housing, food, child care, transportation, health care, “other necessities” like clothing, and taxes for families of 10 different compositions in these specific locales.</em></p> <p>&nbsp;</p> <p><em><strong>The updated&nbsp;<a href="">Family Budget Calculator</a>&nbsp;shows that even the most affordable metropolitan areas in the country are beyond the reach of millions of American families with incomes above the official federal poverty level</strong>. The official federal poverty level for a family of two parents and two children in 2014 was $24,008, according to the EPI.&nbsp;But the least expensive metropolitan area in the country for this family type is Morristown, Tennessee, where a family needs an income of $49,114, according to the Economic Policy Institute’s budget calculator.</em></p> <p>&nbsp;</p> <p><em>The Economic Policy Institute also estimates that minimum-wage workers — who almost universally earn less than the federal poverty level — lack the income needed to make an adequate living in any of the communities surveyed, even if they are single and childless. The think tank notes that this includes minimum-wage workers living in cities or states with a higher minimum wage than the federal minimum of $7.25 an hour, or&nbsp;<a href="">$15,080 a year</a>&nbsp;for a full-time worker.</em></p> <p>&nbsp;</p> <p><em><strong>Even families with incomes closer to the middle of the earnings spectrum lack the means to maintain an adequate standard of living.</strong> The nation’s&nbsp;<a href="">median household income</a>&nbsp;was $51,939 in 2013 — the most recent year in which data were available — not much higher than the cost of living in the relatively inexpensive Morristown.</em></p> </blockquote> <div> <p>Where’s our hero when you need him?</p> <p><img src="" alt="Screen Shot 2015-08-20 at 3.21.02 PM" width="487" height="499" class="alignnone wp-image-26487" /></p> </div> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="475" height="465" alt="" src="" /> </div> </div> </div> Census Bureau Main Street recovery Tue, 01 Sep 2015 02:20:00 +0000 Tyler Durden 512680 at Russian Military Forces Arrive In Syria, Set Forward Operating Base Near Damascus <p>While military direct intervention by US, Turkish, and Gulf forces over Syrian soil escalates with every passing day, even as Islamic State forces capture increasingly more sovereign territory, in the central part of the country, the Nusra Front dominant in the northwestern region province of Idlib and the official "rebel" forces in close proximity to Damascus, the biggest question on everyone's lips has been one: would Putin abandon his protege, Syria's president Assad, to western "liberators" in the process ceding control over Syrian territory which for years had been a Russian national interest as it prevented the passage of regional pipelines from Qatar and Saudi Arabia into Europe, in the process eliminating Gazprom's - and Russia's - influence over the continent. </p> <p>As recently as a month ago, the surprising answer appeared to be an unexpected "yes", as we described in detail in "<a href="">The End Draws Near For Syria's Assad As Putin's Patience "Wears Thin</a>." Which would make no sense: why would Putin abdicate a carefully cultivated relationship, one which served both sides (Russia exported weapons, provides military support, and in exchange got a right of first and only refusal on any traversing pipelines through Syria) for years, just to take a gamble on an unknown future when the only aggressor was a jihadist spinoff which had been created as byproduct of US intervention in the region with the specific intention of achieving precisely this outcome: overthrowing Assad (see "<a href="">Secret Pentagon Report Reveals US "Created" ISIS As A "Tool" To Overthrow Syria's President Assad</a>").</p> <p>As it turns out, it may all have been just a ruse. Because as <a href=",7340,L-4696268,00.html">Ynet reports</a>, not only has Putin not turned his back on Assad, or Syria, but the Russian reinforcements are well on their way. Reinforcements for what? Why to fight the evil Islamic jihadists from ISIS of course, the same artificially created group of bogeyman that the US, Turkey, and Saudis are all all fighting. In fact, this may be the first world war in which everyone is "fighting" an opponent that everyone knows is a proxy for something else.</p> <p><a href=",7340,L-4696268,00.html">According to Ynet</a>, <strong>Russian fighter pilots are expected to begin arriving in Syria in the coming days, and will fly their Russian air force fighter jets and attack helicopters against ISIS and rebel-aligned targets within the failing state. </strong></p> <p>And just like the US and Turkish air forces are supposedly in the region to "eradicate the ISIS threat", there can't be any possible complaints that Russia has also decided to take its fight to the jihadists - even if it is doing so from the territory of what the real goal of US and Turkish intervention is - Syria. After all, it is a free for all against ISIS, right?</p> <p>From <a href=",7340,L-4696268,00.html">Ynet</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>According to Western diplomats, <strong>a Russian expeditionary force has already arrived in Syria and set up camp in an Assad-controlled airbase. </strong>The base is said to be in area surrounding Damascus, and will serve, for all intents and purposes, <strong>as a Russian forward operating base.</strong></p> <p>&nbsp;</p> <p><strong>In the coming weeks thousands of Russian military personnel are set to touch down in Syria, including advisors, instructors, logistics personnel, technical personnel, members of the aerial protection division, and the pilots who will operate the aircraft.</strong> </p> </blockquote> <p>The Israeli outlet needless adds that while the current makeup of the Russian expeditionary force is still unknown, "<strong>there is no doubt that Russian pilots flying combat missions in Syrian skies will definitely change the existing dynamics in the Middle East.</strong>"</p> <p>Why certainly: because in one move Putin, who until this moment had been curiously non-commital over Syria's various internal and exteranl wars, just made the one move the puts everyone else in check: with Russian forces in Damascus implicitly supporting and guarding Assad, the western plan instantly falls apart.</p> <p>It gets better: if what Ynet reports is accurate, Iran's brief tenure as Obama's BFF in the middle east is about to expire:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Western diplomatic sources recently reported that a series of negotiations had been held between the Russians and the Iranians, mainly focusing on ISIS and the threat it poses to the Assad regime. The infamous Iranian Quds Force commander Major General Qasem Soleimani recently visited Moscow in the framework of these talks. <strong>As a result the Russians and the Iranians reached a strategic decision: Make any effort necessary to preserve Assad's seat of power, so that Syria may act as a barrier, and prevent the spread of ISIS and Islamist backed militias into the former Soviet Islamic republics</strong>. </p> </blockquote> <p>See: the red herring that is ISIS can be used just as effectively for defensive purposes as for offensive ones. And since the US can't possibly admit the whole situation is one made up farce, it is quite possible that the world will witness its first regional war when everyone is fighting a dummy, proxy enemy which doesn't really exist, when in reality everyone is fighting everyone else!</p> <p>That said, we look forward to Obama explaining the American people how the US is collaborating with the one mid-east entity that is supporting not only Syria, but now is explicitly backing Putin as well.</p> <p>It gets better: Ynet adds that "<strong>Western diplomatic sources have emphasized that the Obama administration is fully aware of the Russian intent to intervene directly in Syria, but has yet to issue any reaction... </strong>The Iranians and the Russians- with the US well aware- have begun the struggle to reequip the Syrian army, which has been left in tatters by the civil war. <strong>They intend not only to train Assad's army, but to also equip it. During the entire duration of the civil war, the Russians have consistently sent a weapons supply ship to the Russian held port of Tartus in Syria on a weekly basis</strong>. The ships would bring missiles, replacement parts, and different types of ammunition for the Syrian army<strong>.</strong>"</p> <p>Finally, it appears not only the US military-industrial complex is set to profit from the upcoming war: Russian dockbuilders will also be rewarded:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Arab media outlets have recently published reports that Syria and Russia were looking for an additional port on the Syrian coast, which will serve the Russians in their mission to hasten the pace of the Syrian rearmament.</p> </blockquote> <p>If all of the above is correct, the situation in the middle-east is set to escalate very rapidly over the next few months, and is likely set to return to the face-off last seen in the summer of 2013 when the US and Russian navies were within earshot of each other, just off the coast of Syria, and only a last minute bungled intervention by Kerry avoided the escalation into all out war. Let's hope Kerry has it in him to make the same mistake twice.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="640" height="360" alt="" src="" /> </div> </div> </div> Middle East Obama Administration Reality Saudi Arabia Turkey Tue, 01 Sep 2015 01:49:30 +0000 Tyler Durden 512679 at Is This Man Responsible For China's Stock Market Crash? <p><a href=""><em>Authored by Shannon Tiezzi, originally posted at,</em></a></p> <div class="postBody"> <p><strong>If Chinese authorities are to be believed, we finally know the cause of the country&rsquo;s stock market woes: a single reporter.</strong> In a video segment aired by China&rsquo;s state television broadcaster, journalist Wang Xiaolu confessed to fabricating a &ldquo;sensationalized&rdquo; story about the stock market and claimed responsibility for having &ldquo;caused panic and disorder&rdquo; among China&rsquo;s investors.</p> <p><a href=""><img height="197" src="" width="386" /></a></p> <p>&nbsp;</p> <p>At issue is a story Wang wrote for <em>Caijing </em>on July 20, in which <strong>he reported that China Securities Regulatory Commission was looking to end interventions designed to prop up share prices.</strong> CSRC <a href="" target="_blank">denied the report</a>, which was removed from <em>Caijing&rsquo;s </em>website last week. CSRC blamed Wang&rsquo;s piece for a massive drop in the stock market in late July, which sparked market woes that continue today.</p> <p><em>Caijing, </em>a financial and business newspaper in China, often pushes the envelope of state-sanctioned media coverage. It has been particularly active in publishing investigations into the finances and business connections of officials suspected of corruption.</p> <p><strong>Wang was arrested on August 25 for &ldquo;fabricating and spreading false information about securities and futures trading.&rdquo;</strong> A <em>Xinhua </em>report said that Wang had confessed to writing a false report on China&rsquo;s stock market. <a href="" target="_blank">According to <em>Xinhua</em></a><em>, </em>Wang admitted that his story &ldquo;caused panics and disorder at stock market, seriously undermined the market confidence, and inflicted huge losses on the country and investors [sic].&rdquo;</p> <p><strong>On Monday, <em>CCTV</em> aired a <a href="">video confession</a> from Wang, in which he said he was &ldquo;deeply sorry&rdquo; for his actions. </strong>&ldquo;At such a sensitive time, I should not have published a report that negatively affected the market,&rdquo; Wang said, saying he had &ldquo;caused great losses to the country and to investors&rdquo; all for the sake of &ldquo;sensationalism.&rdquo;</p> <p>Reporters Without Borders condemned Wang&rsquo;s arrest in a statement issued on August 28. <span style="text-decoration: underline;"><strong><em>&ldquo;Suggesting that a business journalist was responsible for the spectacular fall in share prices is a denial of reality,&rdquo; the international non-profit&rsquo;s secretary general Christophe Deloire <a href=",48267.html" target="_blank">said in the statement</a>. &ldquo;Blaming the stock market crisis on a lone reporter is beyond absurd.&rdquo;</em></strong></span></p> <p><strong>Chinese authorities have warned media outlets not to speculate on (or devote too much coverage to) the stock market troubles.</strong> The high-profile scapegoating of Wang is likely designed to send a stern message to other journalists thinking about following in his footsteps. And journalists aren&rsquo;t the only ones being encouraged to keep quiet: China&rsquo;s Ministry of Public Security also said that it had <a href="" target="_blank">punished 197 people</a> for spreading online rumors about the stock market crash, the deadly explosions in Tianjin, and China&rsquo;s upcoming military parade.</p> <p><strong>Meanwhile,<em> Xinhua </em>also reported that a CSRC official, Liu Shufan, is under investigation for insider trading and accepting bribes. </strong> Four senior executives at Citic Securities, China&rsquo;s largest brokerage firm, are also under investigation for insider trading. All five men have confessed, <em><a href="" target="_blank">Xinhua </a></em><a href="" target="_blank">said</a>.</p> <p>Chinese markets endured another roller-coaster-ride of a day on Monday, with both the CSI300 index and the Shanghai Composite Index dropped more than four percent before rising again in the afternoon. Both indexes fell by around 12 percent over the month of August, <em><a href="" target="_blank">Reuters</a></em><a href="" target="_blank"> report</a><a href="" target="_blank">ed</a>, and have lost almost 40 percent of their value compared to mid-June 2015.</p> </div> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="386" height="197" alt="" src="" /> </div> </div> </div> Caijing China Corruption Insider Trading Market Crash Newspaper Reality Reuters Tue, 01 Sep 2015 01:05:00 +0000 Tyler Durden 512672 at Exposed: The New American Way Of Life <p>It's enough to make you cry... <strong><em>or scream.</em></strong></p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="574" /></a></p> <p>&nbsp;</p> <p><a href=""><em>Source: The Lonely Libertarian</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="180" height="39" alt="" src="" /> </div> </div> </div> Tue, 01 Sep 2015 01:00:00 +0000 Tyler Durden 512664 at "It's The Gun's Fault!!" <p>Presented with no comment...</p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="453" /></a></p> <p>&nbsp;</p> <p><a href=""><em>Source:</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="693" height="523" alt="" src="" /> </div> </div> </div> Tue, 01 Sep 2015 00:50:00 +0000 Tyler Durden 512673 at The Age Of Voodoo Finance <p><a href=""><em>Submitted by Jeffrey Snider via Alhambra Investment Partners,</em></a></p> <p><strong>The Jackson Hole gathering may end up providing at least some clarification, but not even close to the manner in which everyone seems intent on inferring.</strong> With Janet Yellen&rsquo;s notable absence, there isn&rsquo;t the same sort of celebrity about what would have been the media hanging upon every word; that is, after all, what the Federal Reserve has become, <em><u><strong>not an organ of stability or even expertise but a public relations effort aimed squarely at trying to convince everyone possible that it is</strong></u></em>. Given the unique circumstances at the moment,<strong> the real issue is not whether they might raise rates but just how much systemic misdirection has already been revealed even to the least attentive of people.</strong></p> <p>The retreat at Jackson Hole goes back more than thirty years to the early 1980&rsquo;s and Paul Volcker&rsquo;s apparent affinity for fly fishing. It had started more as a very quiet and exclusive affair but for the first time this year there were outside and competing conferences held at the same time in the same place. That configuration, I think, speaks volumes about finally understanding the broad, general terms of what monetary policy actually is.</p> <p>Apparently, right next to the main central banker conclave, a left-wing group was meeting ostensibly not to target the Fed and its Wall Street bias, <strong>perceived or not, but rather to urge it <em>against</em> <a href="" target="_blank">ending ZIRP</a>.</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&ldquo;The economy has not fully recovered and interest rates should not be raised when racial disparities exist,&rdquo; said Shawn Sebastian, a policy advocate for the Fed Up Coalition of the Center for Popular Democracy, pointing to continued higher-than-average unemployment rates for black Americans&hellip;</p> <p> </p><p>As Fed officials hear from central bankers from Switzerland and Chile Friday, they are doing so practically next door to a workshop called &ldquo;Do Black Lives Matter to the Fed?&rdquo; sponsored by Sebastian&rsquo;s group, which wants rates to stay low until wage growth and unemployment improve, especially for minorities.</p> </blockquote> <p><strong>The Fed Up Coalition is a grab bag of union activists and community organizers, the very sorts that propelled the crude communism of Occupy Wall Street almost five years ago. </strong>This is not to say that there might be differences in what becomes embraced on the heavily governmental wing, but for a few generations it had been that Wall Street and &ldquo;money&rdquo; were upon the &ldquo;side&rdquo; of free market set against those government means of redistribution.</p> <p><strong>Even the Fed itself, especially under Yellen, has taken up &ldquo;inequality&rdquo; as a major emphasis with the same lack of self-awareness that it has operated with for decades.</strong> This, however, is not really much of a change as the institution has been the same side of the coin going back to the reformation after the Great Inflation; the ruse about free markets was always that, as monetary policy has never been anything else other than redistribution by other means.</p> <p><strong><u>The crude history of the Great &ldquo;Moderation&rdquo; gives away the charade, as at the end of the 1970&rsquo;s there were no more charms in &ldquo;demand side&rdquo; economics.</u></strong> Even the great &ldquo;liberals&rdquo; of the day had renounced Keynesianism with full vigor, setting up the &ldquo;supply side&rdquo; as the great answer to the decade and a half malaise of redistribution experimentation (with the &ldquo;inflation&rdquo; part coming as the Fed was <a href="" target="_blank">monetizing it all</a>). It was so unquestioned that George HW Bush accused Ronald Reagan of risking more &ldquo;inflation&rdquo; by including tax cuts for individuals rather than exclusively limiting to the business end; that was the infamous &ldquo;voodoo economics&rdquo; that Bush proposed, the historically-invalidated redistribution of the &ldquo;demand side.&rdquo;</p> <p><strong>The idea of &ldquo;supply side&rdquo; economics has come to mean, I think, more about tax cuts in general than anything of a true set of economic ideas.</strong> That isn&rsquo;t surprising given politics playing out over more than thirty years, but for me it really comes down to redistribution vs. markets. There is always going to be some of both in any economic system, the question is really about the balance especially at setting the marginal economic changes. In that sense, tax cuts have to be seen in the broader framework of a market-oriented approach rather than their own ends.</p> <p><strong>What was most devious about monetarism is that it snuck in way under the radar as if it were among those market schemes. </strong>A lot of that has to do with the secrecy with which monetary policy was carried and why that was so, but mostly it was Paul Volcker who had, starting in 1979, given the Fed &ldquo;market&rdquo; credibility that in hindsight was obviously overstated. It is taken as convention that Volcker &ldquo;defeated&rdquo; the &ldquo;demand side&rdquo; inflation by placing the US into recession twice. Thereafter would be the &ldquo;supply side&rdquo; revolution of &ldquo;Reaganomics.&rdquo;</p> <p><strong>Almost straight away you can see that wasn&rsquo;t really true; after all, how in the world could this market approach during the Great &ldquo;Moderation&rdquo; end up with <em>serial</em> asset bubbles? It never really was truly an embrace of the market format, especially at the Federal Reserve which had already begun to explore means of intruding further and further.</strong> The &ldquo;exploitable&rdquo; Philips Curve, which had engendered the start of the Great Inflation was monetary policy intent on &ldquo;aiding&rdquo; fiscal redistribution (in the form, firstly, of the &ldquo;Great Society&rdquo; and even Vietnam), had been replaced, at first in an effort to understand what went wrong, by &ldquo;rational expectations.&rdquo; Instead of redistribution by taxation through the Treasury, it was to be monetary redistribution by financialism that wasn&rsquo;t at all truly a market effort.</p> <p>In May 1982, the Fed was debating stabilizing markets over what Volcker termed a &ldquo;rinky dink&rdquo; firm that had caused trouble for several Wall Street dealers. Rather than let actual markets work out and deal out the discipline, the Fed met in an almost emergency setting where Volcker, the assumed champion of free markets, was already on the side of monetary interference.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>VOLCKER Ultimately, if there&rsquo;s no other solution, we might just have to stabilize this market for a period of time. At least I can see that as a possible scenario. So, I just took this very preliminary step of keeping in touch with the market if it really goes off. I think the next step, if the market comes under more pressure, is that we&rsquo;ll just have to go in openly and buy some bonds. That is very insufficient knowledge, but it about summarizes what I know, frankly. The other lenders involved in this particular short-selling operation are apparently major security houses in New York. There is a group of 7 or 8 of them; they&rsquo;re all well-known firms. They should be able to withstand the loss if things ever settle, so far as we know about the loss. But that doesn&rsquo;t mean it won&rsquo;t send ripples of very deep concern all through the market.</p> </blockquote> <p>The very tone and nature of Volcker&rsquo;s methodology is quite recognizable, isn&rsquo;t it? Here, in 1982, was the very Fed that we see right now being crafted in secrecy&nbsp;<em>apart from Wall Street which was very much in the loop </em>(as Volcker says above, &ldquo;I just took this very preliminary step of keeping in touch with the market if it really goes off&rdquo;). Too big to fail had been embraced in other forms before, even in the 1970&rsquo;s, but this was very different as it applied not to individual firms but the whole &ldquo;market.&rdquo; <a href="" target="_blank">As I wrote further</a> about this voodoo history, this was perhaps the central point of this coming &ldquo;moderate&rdquo; age:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>This was just a minor episode of primitive &ldquo;too big to fail&rdquo; in its view of &ldquo;market stability&rdquo; as a primary function of policy &ndash; <span style="text-decoration: underline;"><strong>which opens up the entire so-called market to a central bank determining wholly on its own what counts as &ldquo;stability&rdquo; and even where that applies to which &ldquo;market.&rdquo;</strong></span> &hellip;The Fed was, by the early 1980&rsquo;s, making plain where its priorities were taking policy and why. Almost at the same moment the &ldquo;supply side&rdquo; of economics removed the Keynesian destructiveness from the mainstream the &ldquo;demand side&rdquo; had already re-entered the back door of the open Fed.</p> </blockquote> <p>Once taking the technocratic reins, they have only increased the applications in exactly those terms &ndash; deciding, particularly through the Greenspan era, to &ldquo;stabilize&rdquo; not just minor bond market perturbations but whole asset markets and actually the entire economy. &ldquo;Filling in troughs without shaving off the peaks&rdquo; is exactly this kind of mission creep, where the Fed took it upon itself to &ldquo;stabilize&rdquo; the world, all done by <em>monetary redistribution</em>.</p> <p><em>As if to emphasize this point beyond any of my own descriptive capabilities, by the time of the dot-com bubble, monetary models and modes of mathematical incorporation had turned back once more toward Keynesian thinking about the mechanics of the economy; the monetarists had not removed the &ldquo;demand side&rdquo;, far from it, they only changed the primary manner in which it was to be &ldquo;stabilized&rdquo;, going from taxes and treasuries to central banks and financial factors. <strong><u>The voodoo of technocratic redistribution had never actually disappeared, it went underground faking free markets.</u></strong></em></p> <p><u><strong>I believe that is why we are starting to see another re-alignment at least in perceptibility.</strong></u> The Fed isn&rsquo;t much fooling anyone about being dedicated to actual markets, at least not to the degree it was taken in the years before 2007. As it is, if you look closely, it has become quite openly hostile to them just as Samuelson and Solow were writing about in 1960. <strong>That is why I termed that period of the Great &ldquo;Moderation&rdquo; the <a href="" target="_blank">third age of economic socialism</a> because it was entirely redistribution in the monetary part that had taken over from the fiscal part which had so utterly failed as to be universally rejected in bipartisan fashion. </strong>But rather than give way to the free market rebirth as is commonly cited (again, how could free market discipline lead to not just a single asset bubble but rather a series of them globally?) it was just the same voodoo system with different actual incantations.</p> <p><strong>This political re-alignment is simply another view to what is certainly the end of that third age.</strong> Central banking has run itself aground and there isn&rsquo;t much hiding anymore either that fact or the means by which it has been operating all this time. Hopefully we can yet get it right, that there won&rsquo;t be any more underground subversion disposed of the same inevitable failings; markets actually work whereas technocracy only ends up with totalitarian (read: unresponsive) disruptiveness and decay. <strong>The argument for the technocratic approach, under more honest discussion, has always been that it might achieve less robust growth on the upswings but would be absent the violence and messiness of a purely market regime, a more stable and steady platform as an almost utopian piety.</strong></p> <p><a href=""><img alt="Three AGES" class="aligncenter size-full wp-image-30818" src="" style="width: 601px; height: 154px;" /></a></p> <p>&nbsp;</p> <p><u><strong>By 2015, it is beginning to dawn quite widely that instead the redistribution in this form isn&rsquo;t different at all from the last, delivering instead the same or worse violence and instability only <em>without any</em> of the economic growth.</strong></u> Already, the lines are being drawn in ways in which to go back exclusively to the 1960&rsquo;s and 1970&rsquo;s as if it has been markets the problem all along. Properly understanding what has happened is the only in which to understand how to break out of it.</p> <p>&nbsp;</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="166" height="140" alt="" src="" /> </div> </div> </div> Bond Central Banks Crude Fail Federal Reserve Janet Yellen keynesianism Monetary Policy Paul Volcker Recession Switzerland Too Big To Fail Unemployment Tue, 01 Sep 2015 00:40:00 +0000 Tyler Durden 512671 at Dow Futures Plunge 240 Points As Oil Drops 4% Ahead Of China PMI <p>Just when you thought it was safe to listen to the stability-preaching talking heads,<strong> crude futures are sliding and US equity futures are tumbling as Asia opens</strong>. Worse still <strong>XIV (VIX inverse ETF) has tumbled to fresh lows with a 24 handle</strong> in the after-hours market, suggesting more downside for stocks. With all eyes on China PMIs - <em>though, there is little need for a weak PMI to be present for China to unleash moar measures, and a strong PMI will be scoffed at</em> - it seems, the end-of-month rip-fest is fading fast...</p> <p>&nbsp;</p> <p>Oil is sliding back..</p> <p><a href=""><img height="374" src="" width="600" /></a></p> <p>As Goldman explains,</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong>within the context of the global oil market balance, rising OPEC and elevated non-OPEC ex. US production leave the global oil market still oversupplied with a decline in US production in 2016 increasingly likely to halt the build in inventories.</strong> For example, OPEC production rose by 485 kb/d between April and June as US production declined by 316 kb/d.</p> <p>&nbsp;</p> <p>As a result, <strong>we reiterate our view that oil prices have to remain low, with our near-term WTI forecast of $45/bbl, to rebalance the oil market by late 2016</strong></p> </blockquote> <p>but US equity futures are tumbling... back to Thursday JPM crash levels...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 388px;" /></a></p> <p>&nbsp;</p> <p>Front-month VIX futures surge back to Monday&#39;s highs...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 296px;" /></a></p> <p>&nbsp;</p> <p>As XIV tumbles... well below the scene of Friday&#39;s crime...</p> <p><a href=""><img height="322" src="" width="600" /></a></p> <p>&nbsp;</p> <p>And VXX nears Monday&#39;s flash-crash highs...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 322px;" /></a></p> <p>&nbsp;</p> <p>For if we learned one thing last week, it is the suddenly-illiquid ETF tail wagging the dog underlying assets that creates the big air pockets in today&#39;s markets.</p> <p>&nbsp;</p> <p><em>Charts: Bloomberg</em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1363" height="911" alt="" src="" /> </div> </div> </div> China Crude OPEC Tue, 01 Sep 2015 00:24:00 +0000 Tyler Durden 512677 at Brazil Throws In Towel On Budget; Citi Compares Fiscal Outlook To "Bloody Terror Film" <p>Late last week, Brazil officially entered a recession as the economy contracted 1.9% in Q2, a quarter in which Brazilians suffered through the worst stagflation in over ten years.&nbsp;</p> <p>What was perhaps worse than the GDP print however, was budget data for July which was meaningfully worse than expected. "On a 12-month trailing basis the consolidated public sector recorded a 0.9% of GDP primary deficit in July, worse than the 0.6% of GDP deficit recorded in December and, therefore, increasingly distant from the new unimpressive +0.15% of GDP surplus target," Goldman noted.</p> <p>We summed the situation up as follows:<strong> “<a href="">No primary surplus for you!</a>"&nbsp;</strong></p> <p><span style="font-size: 1em; line-height: 1.3em;">And while analyzing LatAm fiscal policy doesn’t make for the most exciting reading in the universe,<strong> this particular budget battle is critical for a number of reasons, the most important of which is that Brazil’s investment grade credit rating might just depend on it and to the extent the country is forced to concede that it will not, after all, hit its primary surplus target this year, junk status could be just around the corner.</strong> Needless to say, if Brazil is cut to junk, that will do exactly nothing to help the country combat a bout of extremely negative market sentiment tied to Brazil’s rather prominent role in the great emerging market unwind.&nbsp;</span></p> <p>Sure enough, government sources have now confirmed that embattled President Dilma Rousseff - whose political woes are making it nearly impossible to pass legislation designed to plug gaps - <strong>will now submit a 2016 budget proposal that projects a deficit.</strong> Here’s <a href="">Bloomberg</a>:&nbsp;</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>The Brazilian government will send to Congress Monday a budget proposal for 2016 that projects a primary deficit instead of the previously expected surplus, according to two government sources familiar with the matter.</em></strong></p> <p>&nbsp;</p> <p><em>President Dilma Rousseff had earlier abandoned the idea of reviving the so-called CPMF tax on financial transactions after a backlash from politicians and companies, said the sources, who asked not to be named because the negotiations aren’t public. <strong>The goal now is to send a budget proposal that is more aligned with the reality of a sharp economic slowdown, according to the sources.</strong></em></p> <p>&nbsp;</p> <p><em>Rousseff was alerted by Vice President Michel Temer in the past couple of days that the current political crisis would make it hard to convince the Congress to pass measures such as the CPMF tax. The government had planned to include the revenue collected from the tax in the budget proposal to be sent to lawmakers on Monday, one of the sources said. The president met with some ministers on Sunday to discuss the new budget proposal, according to the source.</em></p> </blockquote> <p>Although, as one analyst <a href="">told Reuters</a>, "the rating agencies are trying to bend over backwards to give Brazil the benefit of the doubt," there's only so much they can do, especially considering the fact that no one likely wants to set a precedent of being behind the curve as we enter what may end up being an outright emerging markets crisis. And a bit more color <a href="">from Bloomberg</a>:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>The government foresees a deficit next year excluding interest payments of 30.5 billion reais ($8.4 billion), or about 0.5 percent of gross domestic product, Budget Minister Nelson Barbosa told reporters in Brasilia on Monday. That compares with a target of 2 percent at the beginning of the year and a revised objective of 0.7 percent announced in July.</em> </p><p>&nbsp;</p> <p><em>The revision reflects the growing political headwinds Finance Minister Joaquim Levy faces in winning congressional approval for austerity measures and pushes Brazil’s credit rating closer to junk status, said Italo Lombardi, senior Latin America economist at Standard Chartered Bank. The government over the weekend scrapped plans to revive a tax on financial transactions following opposition by congressional leaders.</em> </p><p>&nbsp;</p> <p><em>"Politics are making Levy’s life very difficult," Lombardi said by telephone. <strong>"It’s a big red flag and rating agencies would need to show a lot of patience to not downgrade Brazil."</strong></em></p></blockquote> <p><a href=""><img src="" width="600" height="316" /></a></p> <p><img src="" width="600" height="312" /></p> <p>And that, as they say, is all she wrote for Brazil's investment grade rating. </p> <p>We'll close with the following rather colorful analysis from Citi:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>Morning Friends, A Nightmare on Elm Street - one of the scariest movies of my childhood, where Freddy Krueger (a burnt serial killer) used to haunt and execute his victims in their own nightmares, was the origin of asleep nights for many kids of my generation... Well, before I tell you the Nightmares on Via Palacio Presidencial (Brasilia) and what is keeping players asleep, let me voice you that as in any bloody terror film, the villain never dies and the sequels are worse than the initial film. So, the American villain (Fed September Lift-off) is alive, as Vice Chair Fischer suggested over the weekend, sounding less dovish than expected. Also, the Chinese anti-hero (fear of slow growth) never dies, with Korea`s Industrial Production bringing additional woes. </em></p> <p>&nbsp;</p> <p><em>As the film says: &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp;</em></p> <p>&nbsp;</p> <p><em>1&amp;2 - Freddy's coming for you!</em></p> <p>&nbsp;</p> <p><em>3&amp;4 - Better lock the door…</em></p> <p>&nbsp;</p> <p><em><strong>In the meantime, in our (un)beloved country, there is something scarier than Freddy Krueger: our growth / fiscal outlook. </strong>The Growth scenario is haunting and executing our policymakers, with limited ability to halt such negative vortex and took our economic team to revise our GDP forecast to -2.7% (-1.7% previous) in 2015 and to -0.7% (-0.2% prior) in 2016. Mr. Market will price a -3% GDP growth figure in 2015… This damaging growth scenario will undermine the political capability to implement any fiscal austerity measure and will undermine the already bloody fiscal situation. <strong>With no growth and no fiscal measures, the primary fiscal figure for 2015 &amp; 2016 will be scarier than Freddy Krueger &amp; Jason together… Our view is that the 2015 primary fiscal print will be a deficit of -0.7% GDP (-0.3% previous) and &nbsp;-0.1% GDP (+0.3% prior) deficit in 2016. Wires are mentioning that the government will send a draft budget proposal with a primary DEFICIT of 0.50% GDP (+0.70% primary SURPLUS target), with the proposal of reintroduction of the financial tax transaction being defeated and President Dilma not approving further spending cuts. </strong>The Nightmares on Via Planalto Presidencial must be keeping a lot of kids asleep.</em></p> <p>&nbsp;</p> <p><em>Rates are trading 10/51bps wider on back of such bloody fiscal news as Players are pricing the downgrade from the Investment Grade level before year end. As the film says: &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp;</em></p> <p>&nbsp;</p> <p><em>1&amp;2 - Freddy's coming for you!</em></p> <p>&nbsp;</p> <p><em>3&amp;4 - Better lock the door…</em></p> </blockquote> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="541" height="331" alt="" src="" /> </div> </div> </div> Brazil Gross Domestic Product Investment Grade LatAm Market Sentiment Rating Agencies Reality Recession Reuters Stagflation Standard Chartered Tue, 01 Sep 2015 00:15:31 +0000 Tyler Durden 512676 at Unusually Massive Protests Erupt in Japan Against Forthcoming "War Legislation" <p><a href=""><em>Submitted by Mike Krieger via Liberty Blitzkrieg blog,</em></a></p> <p>In case you aren&rsquo;t up to speed on your Japanese history, the nation&rsquo;s post WWII Constitution prohibits military action unless it&rsquo;s in self-defense. Clearly a sensible approach, which is why the current Japanese government, led by the demonstrably insane and incompetent&nbsp;Prime Minister Shinzo Abe, wants to get rid of it.</p> <p>This story is very important. <strong>Not only will this action increase the likelihood of World War III in the Far East, but it&rsquo;s another important example of a government acting against the will of the people.</strong></p> <p>Polling has indicated the Japanese public is against a pivot toward militarization and war, but Prime Minister Shinzo Abe<em>&nbsp;</em>&nbsp;is pushing forward nonetheless. In fact, the current legislation to allow overseas military intervention has already passed the lower house of government. This prompted many Japanese to emerge from their decades long political apathy and get out into the streets.<strong> It&rsquo;s estimated these&nbsp;protests were the largest in recent memory.</strong></p> <p><a href=""><img height="294" src="" width="600" /></a></p> <p>&nbsp;</p> <p>The <a href=";SECTION=HOME&amp;TEMPLATE=DEFAULT"><em>AP</em> reports</a>:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="ap-story-p"><em>TOKYO (AP) &mdash; Mothers holding their children&rsquo;s hands stood in the sprinkling rain, some carrying anti-war placards, while students chanted slogans to the beat of a drum against Prime Minister Shinzo Abe and his defense policies.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>Japan is seeing new faces join the ranks of protesters typically made up of labor union members and graying leftist activists. Tens of thousands filled the streets outside Tokyo&rsquo;s parliament on Sunday to rally against security legislation expected to pass in September.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>&ldquo;No to war legislation!&rdquo; &ldquo;Scrap the bills now!&rdquo; and &ldquo;Abe, quit!&rdquo; they chanted in one of the biggest protests in recent memory. The bills would expand Japan&rsquo;s military role under a reinterpretation of the country&rsquo;s war-renouncing constitution.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>In Japan, where people generally don&rsquo;t express political views in public, such rallies have largely diminished since often-violent student protests in the 1960s.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>The demonstrations started earlier this year and grew sharply after July, when Abe&rsquo;s ruling coalition <strong>pushed the legislation through the more powerful lower house despite polls showing a majority of Japanese were opposed.</strong></em></p> </blockquote> <p class="ap-story-p">Just like in Greece, the Japanese public is&nbsp;rapidly being forced to come to grips with the fact that their opinions don&rsquo;t matter and they are politically irrelevant. Of course, this is also the case in these United States. Recall:&nbsp;<strong><a href="" rel="bookmark" title="Permanent Link to New Report from Princeton and Northwestern Proves It: The U.S. is an Oligarchy">New Report from Princeton and Northwestern Proves It: The U.S. is an Oligarchy</a></strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="ap-story-p"><em>A group called Mothers Against War started in July and gained supporters rapidly via Facebook. It collected nearly 20,000 signatures of people opposed to the legislation which representatives tried unsuccessfully to submit to Abe&rsquo;s office last Thursday.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>The security bills would permit the military to engage in combat for the first time since World War II in cases of &ldquo;collective defense,&rdquo; when Japan&rsquo;s allies such as the U.S. are attacked, but Japan itself is not.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><em>Abe&rsquo;s government argues that the changes are needed for Japan to respond to a harsher security environment, including a more assertive China and growing terrorist threats, and to fulfill expectations that it will contribute more to global peacekeeping.</em></p> </blockquote> <p>&hellip;and to distract a disillusioned population from the disastrous economic policies of its&nbsp;government. Recall from earlier this year:</p> <p><em><a href="" rel="bookmark" title="Permanent Link to Japan’s Economic Disaster – Real Wages Lowest Since 1990, Record Numbers Describe “Hard” Living Conditions">Japan&rsquo;s Economic Disaster &ndash; Real Wages Lowest Since 1990, Record Numbers Describe &ldquo;Hard&rdquo; Living Conditions</a></em></p> <p><em>and&hellip;</em><br /><em><a href="" rel="bookmark" title="Permanent Link to The Stock Market Myth and How the Japanese Middle Class is on the Precipice Thanks to Abenomics"><br />The Stock Market Myth and How the Japanese Middle Class is on the Precipice Thanks to Abenomics</a></em></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="ap-story-p"><em>The topic has become almost a regular item in women&rsquo;s magazines, traditionally known more for covering entertainment, beauty, health, food and the Imperial family.</em></p> <p class="ap-story-p">&nbsp;</p> <p class="ap-story-p"><strong><em>Takashi Watanabe, a deputy editor-in-chief of Shukan Josei (Ladies Weekly), said there has been a growing appetite for social issues among readers, especially since Fukushima.</em></strong></p> </blockquote> <p class="ap-story-p">This is a great sign for Japan. However, when will Americans emerge from their&nbsp;political&nbsp;slumber? Will it take several decades of economic decay such as in Japan?</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="ap-story-p"><em>About half a century ago, 300,000 students, many of them Marxist ideologues, staged violent protests, repeatedly clashing with police, over revising the U.S.-Japan security treaty. Those protests played a role in driving <strong>Abe&rsquo;s grandfather, then-Prime Minister Nobusuke Kishi,</strong> out of office after his government approved the revision.</em></p> </blockquote> <p class="ap-story-p">Apparently, they&nbsp;love failed political dynasties in Japan as well.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="ap-story-p"><em>&ldquo;I&rsquo;m afraid the legislation is really going to reverse the direction of this country, where pacifism was our pride,&rdquo; said a 44-year-old architect who joined Sunday&rsquo;s rally with her 5-year-old son. <strong>&ldquo;I feel our voices are neglected by the Abe government.&rdquo;</strong></em></p> </blockquote> <p class="ap-story-p">You&rsquo;re not the only one&hellip;</p> <p class="ap-story-p">Of course, when it comes to Japan this has been a long time coming.&nbsp;Recall the following published in 2013:</p> <p class="ap-story-p"><em><a href="" rel="bookmark" title="Permanent Link to War on Democracy: Spain and Japan Move to Criminalize Protests">War on Democracy: Spain and Japan Move to Criminalize Protests</a></em></p> <p class="ap-story-p"><em><a href="" rel="bookmark" title="Permanent Link to How Japan’s “Stealth Constitution” Destroys Civil Rights and Sets the Stage for Dictatorship">How Japan&rsquo;s &ldquo;Stealth Constitution&rdquo; Destroys Civil Rights and Sets the Stage for Dictatorship</a></em></p> <p><span style="text-decoration: underline;"><strong>Democracy is dead. Globally. If we fail to bring it back, history will see us as one of the most inept and spineless generations in history.</strong></span></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="1024" height="502" alt="" src="" /> </div> </div> </div> Abenomics China Fail Greece Japan Mon, 31 Aug 2015 23:50:34 +0000 Tyler Durden 512669 at