en The Situation In Syria Is Very, Very Dangerous <p><a href=""><em>Submitted by Mike Krieger via Liberty Blitzkrieg blog,</em></a></p> <p><em><a href=""><img height="228" src="" width="300" /></a></em></p> <p><strong>In case you haven&rsquo;t been&nbsp;paying attention, the recent Syria ceasefire lasted barely&nbsp;a week.</strong> While all sides engaged in&nbsp;the conflict were accusing the other of violating the agreement from the beginning, it really unraveled when U.S. forces bombed Syrian government forces, killing at least 62.</p> <p>As <a href="" target="_blank"><em>CNN</em></a> reported at the time:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p class="zn-body__paragraph"><strong><em>Hours after US-led coalition airstrikes reportedly killed dozens of Syrian troops, the US and Russian ambassadors to the United Nations chastised each other outside an emergency Security Council meeting.</em></strong></p> <p class="zn-body__paragraph">&nbsp;</p> <p class="zn-body__paragraph"><em>The strike occurred Saturday in an eastern part of Syria that is not a part of a delicate and nearly week-old ceasefire. The US military said it was targeting ISIS militants and if it hit Syrian troops, it was an accident. </em></p> <p class="zn-body__paragraph">&nbsp;</p> <p class="zn-body__paragraph"><em>Russia and Syria said the strikes prove Washington and its allies are sympathetic to ISIS. </em></p> <p class="zn-body__paragraph">&nbsp;</p> <p class="zn-body__paragraph"><strong><em>The Russian military said 62 Syrian soldiers were killed near Deir Ezzor Airport, according to state media. The UK-based Syrian Observatory for Human Rights put the death toll at 83 and said at least 120 soldiers were wounded.</em></strong></p> </blockquote> <p><u><strong>A fews day after this, Syrian forces launched an attack on the city of Aleppo, and we now find ourselves in an extraordinarily dangerous situation.</strong></u></p> <p><a href="" target="_blank"><em>Reuters</em></a> reports:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><strong><em>Obama administration officials have begun considering tougher responses to the Russian-backed Syrian government assault on Aleppo, including military options, as rising tensions with Moscow diminish hopes for diplomatic solutions from the Middle East to Ukraine and cyberspace, U.S. officials said on Wednesday. </em></strong></p> <p>&nbsp;</p> <p><em>The new discussions were being held at &ldquo;staff level,&rdquo; and have yet to produce any recommendations to President Barack Obama, who has resisted ordering military action against Syrian President Bashar al-Assad in the country&rsquo;s multisided civil war.</em></p> <p>&nbsp;</p> <p><em>But the deliberations coincide with Secretary of State John Kerry threatening to halt diplomacy with Russia on Syria and holding Moscow responsible for dropping incendiary bombs on rebel areas of Aleppo, Syria&rsquo;s largest city. It was the stiffest U.S. warning to the Russians since the Sept. 19 collapse of a truce they jointly brokered.</em></p> <p>&nbsp;</p> <p><em>But the heavy use of Russian airpower in Syria has compounded U.S. distrust of Russian President Vladimir Putin&rsquo;s geopolitical intentions, not only in the 5-1/2 year civil war, but also in the Ukraine conflict and in what U.S. officials say are Russian-backed cyber attacks on U.S. political targets.</em></p> <p>&nbsp;</p> <p><strong><em>The U.S. officials said the failure of diplomacy in Syria has left the Obama administration no choice but to consider alternatives, most of which involve some use of force and have been examined before but held in abeyance.</em></strong></p> <p>&nbsp;</p> <p><em>These include allowing Gulf allies to supply rebels with more sophisticated weaponry, something considered more likely despite Washington&rsquo;s opposition to this until now. Another is a U.S. air strike on an Assad air base, viewed as less likely because of the potential for causing Russian casualties, the officials told Reuters, speaking on condition of anonymity.</em></p> </blockquote> <p>And now we have the latest escalation:</p> <ul> <li><strong>*U.S. &quot;ON THE VERGE&quot; OF SUSPENDING TIES W RUSSIA ON SYRIA: TONER</strong></li> <li><strong>*U.S. NOT SAYING YET NO NEED FOR RUSSIA TALKS ON SYRIA:TONER</strong></li> <li><strong>*U.S. TIES WITH RUSSIA ON SYRIA MAY CHANGE IN COMING HOURS:TONER</strong></li> <li><strong>*U.S. CONSIDERING SANCTIONS AGAINST RUSSIA OVER SYRIA: TONER</strong></li> </ul> <p>If full fledged war breaks out with Russia, it&rsquo;s very likely to begin in Syria. The only good news here is I doubt Obama will begin any major escalation with only a few months left in his Presidency.</p> <p><strong>The bad news is that if Hillary Clinton is elected President, all hell is likely to break loose in short order.</strong></p> <p>I outlined my reasoning for this forecast in the following posts:</p> <p><em><a href="" rel="bookmark" target="_blank" title="Permanent Link to More Troubling Evidence That Hillary Clinton Will Start WW3">More Troubling Evidence That Hillary Clinton Will Start WW3</a></em></p> <p><em><a href="" rel="bookmark" target="_blank" title="Permanent Link to More Troubling Evidence That Hillary Clinton Will Start WW3 – Part 2">More Troubling Evidence That Hillary Clinton Will Start WW3 &ndash; Part 2</a></em></p> <p><em><a href="" rel="bookmark" target="_blank" title="Permanent Link to Is the Syrian War About to Experience a Major Escalation?">Is the Syrian War About to Experience a Major Escalation?</a></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="300" height="228" alt="" src="" /> </div> </div> </div> Barack Obama Middle East Obama Administration Reuters Ukraine Vladimir Putin Fri, 30 Sep 2016 22:30:00 +0000 Tyler Durden 573678 at 'Big One' Looms As Quake Swarm Strikes Southern California "In The Worrry Zone" <p><a href="">Just five months ago</a>, experts warned that <strong><em>"the springs on the San Andreas system have been wound very,<br /> very tight. And the southern San Andreas fault, in particular, looks<br /> like it’s locked, loaded and ready to go." </em></strong>And now,<a href=""> as The LA Times reports, </a>a rapid succession of <strong>more than 200 small earthquakes began rupturing near Bombay Beach, at the southern tip of the San Andreas fault,</strong> continuing for more than 24 hours.</p> <p><a href=""><img src="" width="600" height="331" /></a></p> <p>The temblors were not felt over a very large area, but, <a href="">as The LA Times continues</a>, they have garnered intense interest — and concern — among seismologists.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>It marked only the third time since earthquake sensors were installed there in 1932 that the area had seen such a swarm,</strong> and this one had more earthquakes than the events of 2001 and 2009.</p> <p>&nbsp;</p> <p>The quakes occurred in one of California’s most seismically complex areas. They hit in a seismic zone just south of where the mighty San Andreas fault ends. It is composed of a web of faults that scientists fear could one day wake up the nearby San Andreas from its long slumber.</p> <p>&nbsp;</p> <p><a href=""><img src="" width="600" height="338" /></a></p> <p>&nbsp;</p> <p>The San Andreas fault’s southernmost stretch has not ruptured since about 1680 — more than 330 years ago, scientists estimate. And a big earthquake happens on average in this area once every 150 or 200 years, so experts think the region is long overdue for a major quake.</p> </blockquote> <p><span style="text-decoration: underline;"><strong>The swarm actually increased the likelihood of a much more major quake in Southern California, at least temporarily.</strong></span></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>According to the U.S. Geological Survey, for the seven-day period following Tuesday, <strong>the chances of a magnitude-7 or greater earthquake being triggered on the southern San Andreas fault are as high as 1 in 100</strong> and as low as 1 in 3,000. The chances diminish over time.</p> </blockquote> <p>Experts said it’s important to understand that the chance of the swarm triggering a big one, while small, was real.</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em><span style="text-decoration: underline;"><strong>“This is close enough to be in that worry zone,” </strong></span></em>seismologist Lucy Jones said of the location of the earthquake swarm. <strong>“It’s a part of California that the seismologists all watch.”</strong></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="750" height="422" alt="" src="" /> </div> </div> </div> Fri, 30 Sep 2016 22:00:00 +0000 Tyler Durden 573676 at New Poll Puts Mayor Of Cormorant, Minnesota Ahead Of Hillary & Trump <p><a href="">Submitted by Charles Hugh-Smith via OfTwoMinds blog,</a></p> <p>For goodness sakes, people--<strong><em>ignore the rigged polls and vote for the candidate you believe in.</em></strong></p> <p><strong>A new national poll has found that 54% of potential voters favor the mayor of Cormorant, Minnesota over either Hillary Clinton or Donald Trump.</strong>&nbsp;The poll surveyed a spectrum of potential voters and has a statistical margin of error of -3/+3%.</p> <p><strong>Here is the mayor of Cormorant, Minnesota:</strong>&nbsp;Duke, a nine-year-old Great Pyrenees. Duke has been re-elected twice, most recently at the end of August.<em><a href="" target="resource">(source: Zero Hedge)</a></em></p> <div><img border="0" src="" /></div> <p><u><strong>The point being made here is polling is easily gamed.&nbsp;</strong></u>First, pick your goal: you want the poll to find Duke is favored above Hillary and Trump.</p> <p>Next, select groups that are likely to vote in line with your goal. For example, start with subscribers to&nbsp;the Bark,&nbsp;Dog Fancy&nbsp;and other dog-owner magazines.</p> <p>Then select leading questions:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>1. If you could select a candidate other than Hillary Clinton or Donald Trump, would you do so?</p> <p>&nbsp;</p> <p>2. Would you be willing to take a chance on an elected official from small-town America, despite his/her lack of national experience?</p> <p>&nbsp;</p> <p>3. Given that more Americans believe in BigFoot than believe the mainstream media is fair and accurate, are you open to an &quot;outsider&quot; candidate for the presidency?</p> <p>&nbsp;</p> <p>4. Given the choice between the twice-re-elected mayor of Cormorant, Minnesota, and either Hillary Clinton or Donald Trump, who would you likely vote for?</p> </blockquote> <div><strong>And that&#39;s how you rig a poll to find that more Americans would vote for Duke the mayor than for either Hillary or Trump.</strong></div> <p>Please read this 17-page PDF explanation of a recent poll carefully and tease apart how it was carefully engineered to get the desired result.&nbsp;OK, I didn&#39;t want to invest all the time and energy, either, but fortunately for us, correspondent Mark G. has done the heavy lifting.</p> <p><a href="" target="resource">Ipsos Poll Conducted for Reuters</a>&nbsp;(17 page PDF)</p> <p><strong>Here is Mark&#39;s analysis:</strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>&quot;This one with Hillary +6% is a good example.</p> <p>&nbsp;</p> <p>First, the sample on page two is very uninformative.</p> <p>&nbsp;</p> <p>Democrats 752</p> <p>Republicans 570</p> <p>Independents 216</p> <p>Total 1538</p> <p>&nbsp;</p> <p>These affiliations don&#39;t sum to the stated survey size (1705), or the number of registered voters (1411), or &quot;likely voters&quot; (1041). We can note the political affiliations recorded exceed the number of those registered. How you can be affiliated without registering...? If this were the case, why were all 1,705 in the survey assigned to a group?</p> <p>&nbsp;</p> <p>However, of the political affiliations that are disclosed, Democrats were 48.89% (752/1538) = 0.4889. in other words, 12 to 16 points higher than actual identification in the US population.</p> <p>&nbsp;</p> <p>This is the composted manure these &quot;polls&quot; consist of now.</p> <p>&nbsp;</p> <p>I think their sole purpose at this point is to game the poll averages and thus support a predetermined narrative in the MSM.&quot;</p> </blockquote> <p><strong>Thank you, Mark.&nbsp;</strong>Dear reader, do you notice the similarity of these polls to the rigged numbers for unemployment, median household incomes and inflation that I have dismantled?</p> <p><em><a href="" target="resource">Fun with Fake Statistics: The 5% &quot;Increase&quot; in Median Household Income Is Pure Illusion</a>&nbsp;(September 19, 2016)</em></p> <p><em><a href="" target="resource">What&#39;s the Real Unemployment Rate? That&#39;s the Wrong Question</a>&nbsp;(September 14, 2016)</em></p> <p><em><a href="" target="resource">Revealing the Real Rate of Inflation Would Crash the System</a>&nbsp;(August 3, 2016)</em></p> <p><em><a href="" target="resource">Inflation Hidden in Plain Sight</a>&nbsp;(August 2, 2016)</em></p> <p><em><a href="" target="resource">The Burrito Index: Consumer Prices Have Soared 160% Since 2001</a>&nbsp;(August 1, 2016)</em></p> <p><em><a href="" target="resource">How Reuters &quot;Tweaked&quot; Its Latest Poll (Again) To Show A Clinton Lead</a>&nbsp;(Zero Hedge)</em></p> <p><u><strong>Polls engineered to manage perceptions are of a piece with statistics engineered to manage perceptions:</strong></u>&nbsp;both are designed to convince us that the status quo is unstoppable and everything is fine--really really fine.</p> <p><strong>This is what the status quo has devolved to: since it can&#39;t/ won&#39;t fix the real problems, it settles for&nbsp;perception management&nbsp;to keep the elites in power</strong>.&nbsp;I&#39;ve laid bare this devolution in several books:</p> <p><em><a href=";camp=1789&amp;creative=9325&amp;creativeASIN=1480219886&amp;linkCode=as2&amp;tag=charleshughsm-20" target="resource">Why Things Are Falling Apart and What We Can Do About It</a></em></p> <p><em><a href=";camp=1789&amp;creative=9325&amp;creativeASIN=B01ELXQZGE&amp;linkCode=as2&amp;tag=charleshughsm-20&amp;linkId=33DAOPEVGBNGBS37" target="resource">Why Our Status Quo Failed and Is Beyond Reform</a></em></p> <p><strong><em>If the status quo is so very very fine, why do I envy the township of Rabbit Hash, Kentucky, which had an unmatched spectrum of choices in their mayoral race?</em></strong></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><a href="" target="resource">&ldquo;In Rabbit Hash, Ky., a Border Collie named Lucy Lou defeated 10 dogs,</a>&nbsp;a cat, a possum, a jackass and even one human to become the town&rsquo;s third animal mayor-- all dogs--since 1998, says Bobbi Kayser, the current mayor&rsquo;s owner.&rdquo;</p> </blockquote> <p><strong>It&#39;s a tough call, but I think my vote goes to the possum.</strong>&nbsp;I like the way he/she makes the rounds at night, consuming all the left-over dog and cat food; you have to admit, that is a useful service to the town&#39;s cleanliness and hygiene.</p> <p><u><strong>For goodness sakes, people--ignore the rigged polls and vote for the candidate you believe in</strong></u>:&nbsp;Hillary, Trump, Stein, Johnson, or write in Duke or Lucy Lou, if your state allows write-ins.</p> <p>As near as I can tell, Duke will not declare war on Russia or ensnare the nation in yet another &quot;war of choice,&quot; and Lucy Lou&#39;s even willing to work with cats. What more can you ask for?</p> <p>Granted, Duke and Lucy Lou are underdogs, but don&#39;t count them out just yet.</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="476" height="323" alt="" src="" /> </div> </div> </div> Consumer Prices Donald Trump Real Unemployment Rate Reuters Unemployment Fri, 30 Sep 2016 21:30:00 +0000 Tyler Durden 573675 at A Furious Rick Santelli Rages At Janet's Jawboning: "Please, Don't Help Anymore" <p>CNBC's Rick Santelli turned it up to '11' today as <a href="">The Fed's Janet Yellen joined the</a><strong><a href=""> world's central planners in suggesting intervention directly in the stock markets would 'help' the average joe</a>.</strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>Santelli exclaims "don't help anymore!!"</strong> How has any of their 'help' helped in the last 7 years?</p> <p>&nbsp;</p> <p><strong><em>"Central banks buying in the [stock] market... you really think that's a good idea?"</em></strong> Raging about picking winners, buying Deutsche Bank, and keeping stocks "steady" around elections, the veteran pit trader exploded,<em><strong> "is that the world we really want to live in?"</strong></em></p> <p>&nbsp;</p> <p><em><strong> </strong></em>The Fed's buying stocks<strong><em> "will completely and utterly and in every possible way destroy and value in the marketplace..."</em></strong></p> </blockquote> <p>3 minutes of brutal reality slapped into the face of a ridiculous rumor-driven day...<strong><em><br /></em></strong></p> <p><iframe src=";byGuid=3000555447&amp;size=530_298" width="530" height="298"></iframe></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="238" height="117" alt="" src="" /> </div> </div> </div> Central Banks Deutsche Bank Janet Yellen Reality Rick Santelli Fri, 30 Sep 2016 21:00:00 +0000 Tyler Durden 573674 at Illinois Suspends "Billions Of Dollars" Of Investment Activity With Wells Fargo <p>Just when you thought you could relax into the weekend knowing that the US (and world) banking system was 'fixed' again thanks to a rumor from French press, Wells Fargo take another hit. Following<a href=""> California's decision to sever all banking ties with the bank</a>, <strong>Illinois State Treasurer Michael Frerichs has confirmed his state's plans to suspend billions of dollars of investment activity with Wells Fargo.</strong></p> <p>As Bloomberg reports, </p> <ul> <li><strong>News conference will be held on Monday at 10:00 a.m. at the James R. Thompson Center in Chicago to share details about the moratorium</strong></li> <li>Treasurer’s office comments in a statement</li> </ul> <p><span>&nbsp;</span> </p> <p><span><a href=""><img src="" width="599" height="414" /></a></span></p> <p>We estimate the score now to be <span style="text-decoration: underline;"><strong>Wells Fargo 0 - 4 Elizabeth Warren</strong></span> (clawbacks, soldier car repo fines, California sanctions, and now Illinois suspending banking)</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="599" height="414" alt="" src="" /> </div> </div> </div> Elizabeth Warren Illinois Wells Fargo Fri, 30 Sep 2016 20:53:44 +0000 Tyler Durden 573677 at Secret Swiss Military Bunkers Being Filled With Gold By Billionaires Seeking "Alternatives To Bank Deposits" <p>For decades, Switzerland had a reputation for bank secrecy that made it the most sought after tax haven for billionaires from around the globe.&nbsp; But, after more than 80 years of secrecy, a series of bilateral agreements with countries around the world, including America’s Foreign Account Tax Compliance Act (FATCA), have forced the private-banking industry in Switzerland to embrace an entirely new era of transparency that requires a full exchange of tax-relevant information with more than a hundred countries.</p> <p>Which, as <a href=";utm_campaign=socialflow-organic&amp;utm_source=twitter&amp;utm_medium=social&amp;cmpid%3D=socialflow-twitter-business">Bloomberg</a> points out, has been a <strong>huge boon for Swiss operators of private vaults which are not subject to the same transparency and reporting requirements as banks</strong>.&nbsp; In fact, these super-secret, privately operated storage facilities buried around the Swiss Alps can basically store anything from anybody because they're not even required to report suspicious activity to Switzerland's Money Laundering Reporting Office.&nbsp; </p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong>“There is growth in gold,”</strong> Wipfli says. <strong>“Since 2008 there has been a real interest in <span style="text-decoration: underline;">alternatives to bank deposits</span>.”</strong> The company explicitly taps into that demand. <strong>Swiss Data Safe “is independent from the banking system and any other organization or interest group,”</strong> according to a PowerPoint presentation Wipfli shows clients. The company and its anonymous rival <strong>aren’t regulated by the Swiss financial-services regulator Finma.</strong></p> <p>&nbsp;</p> <p><strong>Nor do such companies have to report suspicious activity to Switzerland’s Money Laundering Reporting Office.</strong> In the past, submissions to the agency have led the Swiss attorney general to open investigations into corruption at FIFA, the global soccer body, and banking ties to Brazil’s Petrobras bribery scandal.</p> </blockquote> <p><img src="" alt="Swiss " width="600" height="399" /></p> <p>&nbsp;</p> <p>Moreover, American citizens aren’t required under FATCA to declare gold stored outside of financial institutions either.&nbsp; So perhaps it's no surprise that, according to the Swiss defense department, of the roughly <strong>1,000 former military bunkers still in existence across Switzerland, several hundred of them have been sold to private individuals who are now operating them as private storage sites for the gold stash of the world's wealthiest of billionaires.</strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>“The gold trade is a huge part of the Swiss economy,” says John Cassara, a former U.S. Treasury special agent and the author of books on money laundering.</p> <p>&nbsp;</p> <p>“I’m not surprised that there are not more effective efforts in Switzerland to better monitor its misuse. <strong>The powers that be don’t want to crack down.” In the first half of this year, 1,357 metric tons of gold—worth about $40 billion—were imported into Switzerland, according to the Swiss customs office, putting the year on course to be the biggest since a record in 2013</strong>.</p> </blockquote> <p><img src="" alt="Swiss Safe" width="600" height="491" /></p> <p>&nbsp;</p> <p>And, of course, when you're storing billions of dollars worth of gold bars, secrecy is a must.&nbsp; As one unanimous vault operator told Bloomberg, his <strong>vault sits adjacent a private landing strip which allows quick access to his former military bunker buried in the granite face a mountain deep in the Swiss Alps.</strong></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p>Deep in the Swiss Alps, next to an old airstrip suitable for landing Gulfstream and Falcon jets, is a vast bunker that holds what may be one of the world’s largest stashes of gold. The entrance, protected by a guard in a bulletproof vest, is a <strong>small metal door set into a granite mountain face at the end of a narrow country lane</strong>. Behind two farther doors sits a 3.5-ton metal portal that opens only after a code is entered and an<strong> iris scan and a facial-recognition screen are performed</strong>. A maze of tunnels once used by Swiss armed forces lies within.</p> <p>&nbsp;</p> <p>The owner of this gold vault wants to remain anonymous for fear of compromising security, and he worries that even disclosing the name of his company might lead thieves his way. He’s quick to dismiss questions about how carefully he vets clients but says many who come to him looking for a safe haven for their assets don’t pass his sniff test. “For every client we take, we turn one or two away,” he says. “We don’t want problems.”</p> </blockquote> <p><img src="" alt="Swiss Safe" width="600" height="398" /></p> <p>&nbsp;</p> <p>Billionaire Tax Evaders: 1; Internal Revenue Service: 0.</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="952" height="779" alt="" src="" /> </div> </div> </div> Corruption Falcon Switzerland Transparency Fri, 30 Sep 2016 20:30:45 +0000 Tyler Durden 573663 at Weekend Reading: Back Where We Started <p><a href=""><em>Submitted by Lance Roberts via,</em></a></p> <p><a href="" target="_blank">In last weekend&rsquo;s newsletter,</a>&nbsp;I discussed the <em>&ldquo;round-trip&rdquo;</em> move of the market following the Fed&rsquo;s latest announcement to NOT hike rates.</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;It is not surprising the Fed once again failed to take action as their expectations for economic growth were once again lowered. In fact, as I have noted previously, <strong>the Federal Reserve are the worst economic forecasters on the planet.</strong></em></p> <p>&nbsp;</p> <p><em>As shown in the table/chart below,<strong> not only are the expectations for economic growth now the lowest on record, the Fed has given up on 2% growth for the economy with the long-run economic projections now at just 1.9%.&rdquo;</strong></em></p> </blockquote> <p><a href=""><img alt="fomc-economic-forecasts-092116" class="alignnone size-full wp-image-17084" height="512" src="" width="600" /></a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;This should surprise no one.&nbsp;<strong>The Federal Reserve has continued to hope for the last several years that extremely &lsquo;accommodative&rsquo;&nbsp;monetary policy, and near zero interest rates, would spark stronger levels of economic activity leading to a rise in broad-based inflationary pressures.</strong> Unfortunately, this has yet to be the case.</em></p> <p>&nbsp;</p> <p><em>With the Fed holding still on hiking rates, with a promise to now hike in December <span style="color: #993300;">(**cough****bullshit****cough)</span>, traders came rushing back into the market pushing prices right back into the trading range of the last month.&rdquo;</em></p> </blockquote> <p><strong>The chart below shows the <em>&ldquo;round-trip&rdquo;</em> from complacency, to panic, and back to complacency.&nbsp;</strong></p> <p><a href=""><img alt="sp500-vix-092916" class="alignnone size-full wp-image-17239" src="" style="width: 600px; height: 356px;" /></a></p> <p>Importantly, with the markets testing resistance below the bottom of the trading range in August, the issue becomes whether this bounce is a &ldquo;sucker&rsquo;s rally&rdquo; or the beginning of the next leg higher. I continue to suspect the former as the deviation between prices and fundamentals continue to widen.</p> <p>This idea is further supported by the following note from BofAML<a href="" target="_blank"> (via Zerohedge):</a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;</em><em>As BofA&rsquo;s Savita Subramanian reports, over the last several years, we have observed an accelerating trend of flows out of active funds and into passive vehicles. <strong>Price sensitivity of investors to fees, coupled with poor performance trends, have conspired against active funds, and year-to-date flows out of active have reached a post-crisis high.</strong>&ldquo;</em></p> </blockquote> <p><a href=""><img alt="bofa-flows-4_0" class="alignnone wp-image-17240" src="" style="width: 600px; height: 408px;" /></a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;The current year outflows from active funds have now surpassed a record $200 billion, with the bulk of cash outflows shifting to much cheaper (and better performing) passive funds, though as BofA notes, <strong>flows have slowed since last year suggesting that there may be a broader cash outflow from the equity asset class, as increasingly more Americans retire and pull out of the market entirely.&rdquo;</strong></em></p> </blockquote> <p>The last sentence goes to the heart of what I discussed this past week with respect to<a href="" target="_blank"><em> &ldquo;baby boomers&rdquo;</em> and the <em>&ldquo;new secular bull market&rdquo;</em> thesis:</a></p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em>&ldquo;Old people are living longer and young people are delaying marriage and children.&nbsp;<strong>This means fewer people paying into a social welfare system, while more or taking out.</strong></em></p> <p>&nbsp;</p> <p><em>This demographic problem is not going to be fixed anytime soon and has manifested itself in lower rates of household formations. <strong>More importantly, the drag from the elderly on the financial system is going to be a much bigger problem than most currently expect.&rdquo;</strong></em></p> </blockquote> <p>The problem is two-fold.</p> <ol> <li><strong>As an increasing number of individuals begin to extract capital from the market</strong>, there will be a rising headwind to the markets which is dependent on cash inflows for advances.</li> <li>As Tyler notes, <strong>the accelerating transition from active to passive management will end in tears, as passive management only works as long as the rising tide keeps lifting all boats.</strong></li> </ol> <p>As I have discussed previously, while passive indexing works while all prices are rising, the reverse is also true. <strong>The problem is that once prices begin to fall the previously &ldquo;<em>passive indexer&rdquo;</em> becomes an <em>&ldquo;active panic seller.&rdquo;</em></strong>&nbsp;With the flood of money into <em>&ldquo;passive index&rdquo;</em> and <em>&ldquo;yield funds,&rdquo;</em> the tables are once again set for a dramatic and damaging ending.</p> <p>Why do I say that? Because we have seen this occur repeatedly&nbsp;in the markets. In the late 90&rsquo;s everyone was piling into Technology stocks. Heading into 2007, it was all about real estate. <strong>Today it is passive indexing and Robo-Advisors. </strong></p> <p><strong>It is only near peaks in extended bull markets that logic is dismissed for the seemingly easiest trend to make money.</strong> Today is no different as the chart below shows the odds are stacked against substantial market gains from current levels.</p> <p><a href=""><img alt="sp500-marketupdate-092616-4" class="alignnone size-full wp-image-17241" src="" style="width: 600px; height: 449px;" /></a></p> <p>But, in the meantime,&nbsp;here is what I am reading this weekend.</p> <hr /> <h2><u><strong>Fed / Economy</strong></u></h2> <ul> <li><strong>PIMCO: Global Economy About The 3-P&rsquo;s</strong>&nbsp;<a href="" target="_blank">by Elena Holodny via BI</a></li> <li><strong>Yellen Refutes Trumps Partisan Charges&nbsp;</strong><a href="" target="_blank">by Nathan Bomey via USA Today</a></li> <li><strong>Economy Overheating Or Stuck</strong>&nbsp;<a href=";_r=1" target="_blank">via Reuters</a></li> <li><strong>I Trashed The Economy As Fed Head&nbsp;</strong><a href="" target="_blank">by Mark Gilbert via Bloomberg</a></li> <li><strong>Alan Greenspan Confused Again&nbsp;</strong><a href="" target="_blank">by Jeffrey Snider via Alhambra Partners</a></li> <li><strong>Negative Rates Aren&rsquo;t Working&nbsp;</strong><a href="" target="_blank">by Paul Kupiec &amp; Alex Pollock via RCM</a></li> <li><strong>Evidence Of Brexit Vote&nbsp;</strong><a href="" target="_blank">by Allister Heath via The Telegraph</a></li> <li><strong>Rules Vs. Discretion&nbsp;</strong><a href="" target="_blank">by Narayana Kocherlakota via Brookings</a></li> <li><strong>No Hillary, Tax Cuts Don&rsquo;t Cause Recessions&nbsp;</strong><a href="" target="_blank">by Thomas Del Beccaro via Forbes</a></li> <li><strong>Yellen May Quit If Trump Wins</strong>&nbsp;<a href="" target="_blank">by Steve Goldstein via MarketWatch</a></li> <li><strong>Is An Economy Reliant On Yellen Worth Saving?</strong>&nbsp;<a href="" target="_blank">by John Tamny via RCM</a></li> <li><strong>Central Banks Double Down On Failure</strong>&nbsp;<a href="" target="_blank">by Stephen Roach via MarketWatch</a></li> <li><strong>The Fed&rsquo;s Path To Economic Hell</strong> <a href="" target="_blank">via John Mauldin via Forbes</a></li> <li><strong>Half Of Middle Class Lives Paycheck-To-Checkbook</strong> <a href="" target="_blank">by Karol Markowicz via NY Post</a></li> </ul> <hr /> <h2><span style="text-decoration: underline;"><strong>Markets</strong></span></h2> <ul> <li><strong>Passive Investors Unite&nbsp;</strong><a href="" target="_blank">by Danielle DiMartino-Booth via Money Strong</a></li> <li><strong><span style="color: #000000;">50-Slides For Gold Bulls&nbsp;</span></strong><a href="" target="_blank">by Akin Oyedele via BI</a></li> <li><strong>The Ted Spread Isn&rsquo;t Dead&nbsp;</strong><a href="" target="_blank">by Jesse Felder via The Felder Report</a></li> <li><strong>October: Worst Month Of Election Year</strong>&nbsp;<a href="" target="_blank">by Jeff Hirsch via Almanac Trader</a></li> <li><strong>Profit Margins Fortell Credit Cycles&nbsp;</strong><a href="" target="_blank">by Daniel Oliver via Myrmikan Research</a></li> <li><strong>Are Stocks In A &ldquo;Big Fat Ugly Bubble&rdquo;&nbsp;</strong><a href="" target="_blank">by Paul La Monica via CNN Money</a></li> <li><strong>How Charts Make You A Better Investor&nbsp;</strong><a href="" target="_blank">by Michael Kahn via Barron&rsquo;s</a></li> <li><strong>Most Interesting Charts&nbsp;</strong><a href="" target="_blank">by J.C. Parets via AllStarCharts</a></li> <li><strong>Sometimes, Just Do Nothing</strong>&nbsp;<a href="" target="_blank">by Joe Calhoun via Alhambra Partners</a></li> <li><strong>Julian Robertson: This Will End In Chaos</strong>&nbsp;<a href="" target="_blank">by Tyler Durden via ZeroHedge</a></li> <li><strong>A Persistent Profits Recession&nbsp;</strong><a href="" target="_blank">by Ed Yardeni via Yardeni Research</a></li> <li><strong>Yield Curve. Does It Matter?</strong>&nbsp;<a href="" target="_blank">by The Capital Spectator</a></li> <li><strong>Outflows From Active Funds Surpass Records&nbsp;</strong><a href="" target="_blank">by Tyler Durden via ZeroHedge</a></li> <li><strong>Fed&rsquo;s Phony Housing Recovery&nbsp;</strong><a href="" target="_blank">by Lee Adler via ContraClub</a></li> </ul> <hr /> <h2><span style="text-decoration: underline;">Interesting&nbsp;Reads</span></h2> <ul> <li><strong>Wells Fargo: A Culture Problem&nbsp;</strong><a href="" target="_blank">by Bob Bryan via Business Insider</a></li> <li><strong>Stock Charts: How They Work &amp; How To Use Them</strong> <a href="" target="_blank">by Michael Kahn via Barron&rsquo;s</a></li> <li><strong>71% Aren&rsquo;t Saving Enough For Retirement</strong> <a href="" target="_blank">by Rodney Brooks via Washington Post</a></li> <li><strong>7-Reasons Middle Class Is In Trouble</strong>&nbsp;<a href="" target="_blank">by Sean Williams via USA Today</a></li> <li><strong>ObamaCare&rsquo;s Death Spiral&nbsp;</strong><a href="" target="_blank">by Luke Hilgemann via IBD</a></li> <li><strong>The Hot New Millennial Housing Trend&nbsp;</strong><a href="" target="_blank">by Ilana Strauss via The Atlantic</a></li> <li><strong>The Basket Of Deplorable Investments&nbsp;</strong><a href="" target="_blank">by Tony Isola</a></li> <li><strong>Yes, Valuations Still Matter&nbsp;</strong><a href="" target="_blank">by Meb Faber via Faber Research</a></li> <li><strong>Sales Estimates Suggest No Growth</strong>&nbsp;<a href="" target="_blank">by Eric Bush via GaveKal</a></li> <li><strong>Millennials Must Save 22% Of Pay</strong>&nbsp;<a href="" target="_blank">by Darla Mercado via CNBC</a></li> <li><strong>Peak Debt Complacency</strong>&nbsp;<a href="" target="_blank">by Carmen Reinhart via Zerohedge</a></li> <li><strong>Fed: Dope Dealers On Speed-Dial&nbsp;</strong><a href="" target="_blank">by John Hussman via Hussman Funds</a></li> <li><strong>Trump: We Are In A &ldquo;Big Fat Ugly Bubble&rdquo;&nbsp;</strong><a href="" target="_blank">by David Stockman via Contra Corner</a></li> <li><strong>Stocks Test Post-February Uptrend&nbsp;</strong><a href="" target="_blank">by Dana Lyons via Tumblr</a></li> <li><strong><span style="color: #000000;">Must Watch: Central Bank&nbsp;Independence?<a href="">&nbsp;</a></span></strong><a href="">by&nbsp;Jesse Felder via The Felder Report</a></li> </ul> <hr /> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div> <p><em><strong><span style="color: #993300;">&ldquo;Acknowledge the complexity of the world and resist the impression that you easily understand it. It&rsquo;s a basic fact of life that many things &lsquo;everybody knows&rsquo; turn out to be wrong.&rdquo; &mdash;&nbsp;</span></strong><span style="color: #993300;">Jim Rogers</span></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="677" height="278" alt="" src="" /> </div> </div> </div> Federal Reserve fixed Global Economy Jim Rogers John Hussman Monetary Policy Real estate Recession recovery Stephen Roach TED Spread Tyler Durden Fri, 30 Sep 2016 20:30:00 +0000 Tyler Durden 573673 at Project Mayhem - Man Calmly Enters Apple Store And Crushes Every iPhone In Sight With A Ball Bearing <p>It is unclear what caused this Frenchman to walk into an Apple store and <strong>crush every single iPhone in site with a metal ball bearing</strong> but that is exactly what he decided to do.&nbsp; Perhaps he was one of the unfortunate victims of a <a href="">spoof video</a> that apparently succeeding a convincing people to drill a headphone jack in their new iPhone 7?</p> <blockquote class="twitter-video"><p dir="ltr" lang="en">Man walks into Apple Store in France and smashes every <a href="">#iPhone</a> in sight "crazy way to go about an exchange?" <a href=""></a></p> <p>— Shiny Apples UK (@Shiny_Apples) <a href="">September 30, 2016</a></p></blockquote> <script src="//"></script><p>&nbsp;</p> <p>Luckily for the iPhone smasher, this event occurred in France where security guards quickly surrendered the store and allowed the man to simply walk out and go on his merry way.</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="931" height="485" alt="" src="" /> </div> </div> </div> Apple France Twitter Twitter Fri, 30 Sep 2016 20:18:11 +0000 Tyler Durden 573649 at Rumor Rescues Deutsche From Banking Bloodbath But Gold Tops Stocks In September <p>Seriously...</p> <p><iframe allowfullscreen="" frameborder="0" height="315" src="" width="560"></iframe></p> <p>&nbsp;</p> <p><u><strong>Let&#39;s get this Deutsche Bank debacle out of the way first. </strong></u>A rumor - started by Jim Cramer, expanded by a number of twitterati, picked up by Bloomberg, then reported by AFP somehow managed to create a short squeeze rip higher in Deutsche ADRs...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 471px;" /></a></p> <p>&nbsp;</p> <p>Some context for the &#39;recovery&#39;</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 316px;" /></a></p> <p>&nbsp;</p> <p>But the yield curve wasn&#39;t supportive...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 317px;" /></a></p> <p>&nbsp;</p> <p>And CDS wasn&#39;t buying it...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 319px;" /></a></p> <p>&nbsp;</p> <p>And that was enough to spark a buying panic is US equities...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 361px;" /></a></p> <p>&nbsp;</p> <p>And just in case you didn&#39;t think th emachines were in charge...S&amp;P futures tumbled into the close to perfectly end at VWAP...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 314px;" /></a></p> <p>&nbsp;</p> <p>So, let&#39;s get back to the rest of the markets (and wait for the DOJ denial)</p> <p>*&nbsp; *&nbsp; *</p> <p><span style="text-decoration: underline;"><strong>For Q3 Overall</strong></span>, Silver &amp; Stocks lead Q3 performance as oil lags (but overall it was a subdued quarter)...</p> <p><a href=""><img height="313" src="" width="600" /></a></p> <p>&nbsp;</p> <p><strong>Nasdaq was the quarter&#39;s big winner, </strong>The Dow and S&amp;P lagged...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 403px;" /></a></p> <p>&nbsp;</p> <p>Even as rate-hike odds soared...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 319px;" /></a></p> <p>&nbsp;</p> <p>Treasury yields were all up on the quarter, but we note a <strong>14bps bear flattening in the curve</strong>...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 319px;" /></a></p> <p>&nbsp;</p> <p>The USD Index ended Q3 down very modestly (-0.4%) with Yen strength offset by cable weakness...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 317px;" /></a></p> <p>&nbsp;</p> <p>Oil actually legged on the quarter with silver best...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 317px;" /></a></p> <p>*&nbsp; *&nbsp; *</p> <p><u><strong>For September,</strong></u> crude led but PMs outperformed stocks and bonds lagged...</p> <p><img alt="" src="" style="width: 600px; height: 317px;" /></p> <p>&nbsp;</p> <p><strong>Notably The Dow was red on the month and the S&amp;P scrambled to try and breakeven but failed </strong>as Trannies soared in September...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 403px;" /></a></p> <p>&nbsp;</p> <p>Energy stocks outperformed in September as homebuilders and financials lagged...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 317px;" /></a></p> <p>&nbsp;</p> <p>Intersstingly, while the curve flattened markedly on the quarter, it steepened dramatically in September...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p>The USD Index drifted notably on the month, once again as cable weakness was trumped by Yen strength...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p>Copper and Crude outperformed in September, gold lagged...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 318px;" /></a></p> <p>&nbsp;</p> <p>*&nbsp; *&nbsp; *</p> <p><u><strong>Finally, on the week,</strong></u> today&#39;s bounce pulled most stocks into the green but Small Caps lagged (even though they outperformed today)...<strong>UGLY CLOSE</strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 422px;" /></a></p> <p>&nbsp;</p> <p>Futures show just how crazy this week was...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 361px;" /></a></p> <p>&nbsp;</p> <p>Banks managed to scramble back to unchanged on the week...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 318px;" /></a></p> <p>&nbsp;</p> <p>Nothing was stopping stocks today&nbsp; not even a giant 8k block... which as @RockHowse explains was absorbed like a champ...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 488px;" /></a></p> <p>&nbsp;</p> <p>On the week, Treasuries were mixed with 2Y 1bps higher and 30Y 3bps lower...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 314px;" /></a></p> <p>&nbsp;</p> <p>The flatness of 2Y yields is reflected in the perfectly unchanged close of the USD index on the week... (mostly driven by DB&#39;s recovery and exodus from USD safe haven)</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 314px;" /></a></p> <p>&nbsp;</p> <p>WTI Crude had a massive week - best in 2 months - gold and silver pumped and dumped today and copper ended the week green...</p> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></a></p> <p>&nbsp;</p> <p>Jones Trading sums up the week...</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p>US Equities are poised to close a touch higher on the week while Asia and Europe were generally lower. It was a decent week in terms of catalysts &ndash; we had OPEC&rsquo;s &ldquo;consultation&rdquo; that yielded a production cap starting in November, a Presidential debate that yielded several memes and sound-bites, Deutsche Bank made headlines as impending fines by the US DoJ created questions around liquidity and capital. In the end &ndash; it all amounts to the S&amp;P500 closing higher by 20bps &ndash; and flat for the month of September. It wasn&rsquo;t really a macro-narrative shifting week &ndash; economic data continued to fall in-line and Central Bank speak didn&rsquo;t do much to wow investors either. As we highlighted in the past, most market participants appear to be poised for a pull-back, yet this tape continues to move higher. It won&rsquo;t be the first or last time that we prescribe to the idea that this market will continue on the path of most pain. In terms of technical &ndash; this market did struggle to break and hold above the 50-day MA this week. As we are writing this on Friday afternoon, the S&amp;P500 is a couple of points above the 50-day MA &ndash; which is 2168. A few weeks ago we noted that we could likely find ourselves right back between 2150 and 2200 in short-order; this range will likely continue to hold.</p> </blockquote> <p>Translated - no matter WTF happens, stocks inch higher or are rescued... because &quot;wealth creation&quot; and &quot;election&quot;</p> <p><em>Charts: Bloomberg</em></p> <p><strong>Bonus Chart: Do you believe in 2016 GDP growth miracles?</strong></p> <p><a href=""><img alt="" src="" style="width: 600px; height: 315px;" /></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="600" height="101" alt="" src="" /> </div> </div> </div> CDS Copper Crude Deutsche Bank headlines Jim Cramer NASDAQ OPEC recovery Yen Yield Curve Fri, 30 Sep 2016 20:04:30 +0000 Tyler Durden 573672 at Is America Still A Serious Nation? <p><a href=""><em>Submitted by Patrick Buchanan via,</em></a></p> <p><strong><em>Is America still a serious nation?</em></strong></p> <p>Consider. While U.S. elites were denouncing Donald Trump as unfit to serve for having compared Miss Universe 1996 to &ldquo;Miss Piggy&rdquo; of &ldquo;The Muppets,&rdquo; the World Trade Organization was validating the principal plank of his platform.</p> <p><em><strong>America&rsquo;s allies are cheating and robbing her blind on trade.</strong></em></p> <p>According to the WTO, Britain, France, Spain, Germany and the EU pumped $22 billion in illegal subsidies into Airbus to swindle Boeing out of the sale of 375 commercial jets.</p> <p>Subsidies to the A320 caused lost sales of 271 Boeing 737s, writes journalist Alan Boyle. Subsidies for planes in the twin-aisle market cost the sale of 50 Boeing 767s, 777s and 787s. And subsidies to the A380 cost Boeing the sale of 54 747s. These represent crippling losses for Boeing, a crown jewel of U.S. manufacturing and a critical component of our national defense.</p> <p>Earlier, writes Boyle, <strong>the WTO ruled that, &ldquo;without the subsidies, Airbus would not have existed &hellip; and there would be no Airbus aircraft on the market.&rdquo;</strong></p> <p>In &ldquo;<a href="" target="_blank"><strong>The Great Betrayal</strong></a>&rdquo; in 1998, I noted that in its first 25 years the socialist cartel called Airbus Industrie &ldquo;sold 770 planes to 102 airlines but did not make a penny of profit.&rdquo;</p> <p>Richard Evans of British Aerospace explained: &ldquo;Airbus is going to attack the Americans, including Boeing, until they bleed and scream.&rdquo; And another executive said, &ldquo;If Airbus has to give away planes, we will do it.&rdquo;</p> <p>When Europe&rsquo;s taxpayers objected to the $26 billion in subsidies Airbus had gotten by 1990, German aerospace coordinator Erich Riedl was dismissive, &ldquo;We don&rsquo;t care about criticism from small-minded pencil-pushers.&rdquo;</p> <p><strong>This is the voice of economic nationalism. Where is ours?</strong></p> <p>After this latest WTO ruling validating Boeing&rsquo;s claims against Airbus, the Financial Times is babbling of the need for &ldquo;free and fair&rdquo; trade, warning against a trade war.</p> <p><em><strong>But is &ldquo;trade war&rdquo; not a fair description of what our NATO allies have been doing to us by subsidizing the cartel that helped bring down Lockheed and McDonnell-Douglas and now seeks to bring down Boeing?</strong></em></p> <p>Our companies built the planes that saved Europe in World War II and sheltered her in the Cold War. And Europe has been trying to kill those American companies.</p> <p>Yet even as Europeans collude and cheat to capture America&rsquo;s markets in passenger jets, Boeing itself, <a href="" target="_blank"><strong>wrote Eamonn Fingleton in 2014, has been &ldquo;consciously cooperating in its own demise.&rdquo;</strong></a></p> <p>By Boeing&rsquo;s own figures, writes Fingleton, in the building of its 787 Dreamliner, the world&rsquo;s most advanced commercial jet, the &ldquo;Japanese account for a stunning 35 percent of the 787&rsquo;s overall manufacture, and that may be an underestimate.&rdquo;</p> <p>&ldquo;Much of the rest of the plane is also made abroad &hellip; in Italy, Germany, South Korea, France, and the United Kingdom.&rdquo;</p> <p>The Dreamliner &ldquo;flies on Mitsubishi wings. These are no ordinary wings: they constitute the first extensive use of carbon fiber in the wings of a full-size passenger plane. In the view of many experts, by outsourcing the wings Boeing has crossed a red line.&rdquo;</p> <p>Mitsubishi, recall, built the Zero, the premier fighter plane in the Pacific in the early years of World War II.</p> <p><strong>In a related matter, the U.S. merchandise trade deficit in July and August approached $60 billion each month, heading for a trade deficit in goods in 2016 of another $700 billion.</strong></p> <p><u><strong>For an advanced economy like the United States, such deficits are milestones of national decline.</strong></u> We have been running them now for 40 years. But in the era of U.S. economic supremacy from 1870 to 1970, we always ran an annual trade surplus, selling far more abroad than Americans bought from abroad.</p> <p>In the U.S. trade picture, even in the darkest of times, the brightest of categories has been commercial aircraft.</p> <p>But to watch how we allow NATO allies we defend and protect getting away with decades of colluding and cheating, and then to watch Boeing transfer technology and outsource critical manufacturing to rivals like Japan, one must conclude that not only is the industrial decline of the United States inevitable, but America&rsquo;s elites do not care.</p> <p>As for our corporate chieftains, they seem accepting of what is coming when they are gone, so long as the salary increases, stock prices and options, severance packages, and profits remain high.</p> <p><strong>By increasingly relying upon foreign nations for our national needs, and by outsourcing production, we are outsourcing America&rsquo;s future.</strong></p> <p>After Munich in 1938, Neville Chamberlain and Lord Halifax visited Italy to wean Mussolini away from Hitler. The Italian dictator observed his guests closely and remarked to his foreign minister:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><em><strong>&ldquo;These men are not made of the same stuff as the Francis Drakes and the other magnificent adventurers who created the empire. These, after all, are the tired sons of a long line of rich men, and they will lose their empire.&rdquo;</strong></em></p> </blockquote> <p>If the present regime is not replaced, something like that will be said of this generation of Americans.</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="238" height="139" alt="" src="" /> </div> </div> </div> Boeing Donald Trump Dreamliner France Germany Italy Japan Nationalism Trade Deficit Trade War United Kingdom World Trade Fri, 30 Sep 2016 19:50:00 +0000 Tyler Durden 573670 at