2. Jupiter Saturn geocentric opposition takes place on the 29th while at that same date the Sun will be square Pluto followed by a challenging New Moon (NM) on the 3rd as it is on the axis of the Jupiter / Saturn opposition. Hence we can expect a set back early next week before a likely challenge of the recent tops is very likely thereafter before we are up for the bigger correction as we enter month 8 in April. Right after the NM we will have a few benign days which should help the banksters to keep the bull alive for a little bit more. In about 2 weeks when Mars enters Aries the Middle East will even be much more on revolutionary path that makes Saudi Arabia the deal-killer for the bull-market ponzi scam. Once the biggest oil producer joins the turmoil things will be out of control as USA foreign policy will be screwed as they cannot fight democracy in order to support their biggest ally in the region who happens to sit on the biggest oil reserves. The historic change in this region will change the global power balance as China and Russia are eager to get hold of those resources as well against the Rothschild/Rockefeller interests thereby Russian oil is mostly in their hands anyway.
Anyway it will run inflation at higher levels while melting corporate profits, even cutting of energy creating production bottlenecks. The war machinery will make some producers very happy though as Libya only creates replacement demand for at least 1 bil per week the shootout lasts ( the 100 tomahawks fired first 2 days just cost around 150 mio.). While Obama is jet-setting the world he really enjoys the rockstar part of the job he keeps up the lyrics of his propaganda songs while delivering no results but for his bankster sponsors.
TRUST NO ONE.
Not the Fed to stay out of equities markets, directly or indirectly, nor to just maintain the purchasing power of dollars; nor to manage economic policy, which back in the day was not the function of a bank. Nor can we trust many elected officials who can’t keep their election promises, be it national office from top down, and not local government which seems incapable of adjusting their own wages and budgets to reflect stable to decline property taxes.
Back when I was a young tiger of a newscaster (long, long ago) I became cynical about voting, seeing up close and personal how the powerful and the rich spread money around to favor policies which most favored their interests which they wrapped up as “good public policy” but which upon inspection was usually a self-interested lie. Shocker, huh?
Lammert’s Next Swan
Still, if we get a good run-up in the market today, I may re-enter shorts just to see what happens next week. Clif’s ‘hot period’ is upon us from today over the weekend into early next week, and The Fractal Economist, Gary Lammert sees fractal trouble ahead then, too:
“George, 30 March 2011. Never forget the chief benefactors of the central banks’ collective push on the string: the incipiently bailed out trading houses with their 144 billion in politician bought, legally tax sheltered bonuses, the system’s bond holding super rich, and the speculators. Because the trading houses are very savvy regarding asset valuation saturation curves with their computerized programs always and instantaneously on the trading keys, during the historical asset valuation collapse, the trading houses will make out even beyond the true bandits they are. Up or down it doesn’t matter; in fact; faster down, much much greater profit. There is no sheriff in town for these elite. They profit without labor from the monetary system they helped establish in 1913 and the trading system whose derivative valuations are publicized everyday, now linearly equated to America’s well being..
The central banks’ attempts to stem the tide of deflationary collapse are reaching a conclusion. The albino black swan event is predicted for 29-30 March 2011. The timing is exactly proportional to the fractal pattern of the 6 May 2010 collapse. Purchases of new US housing plummeted in February reflective of housing market saturation, paucity of new jobs and wages, relative over valuation of housing value relative to new job growth and intermediate term job demand, and overhanging debt of the recently graduated and citizens nearly everywhere collectively underwater. Portugal and Spain are beyond hope and beyond the final yard of push string the European central bank can imagine. This is the true deflationary nonlinear economic reality – not the historically and linearly overvalued, overpurchased, completely saturated equity and commodity asset valuation saturation curves at the synchronized second fractal break point.
All of which leaves me with one of the most perplexing investment problems of all: On the one hand, we’re in Clif’s window and Lammert’s got a fractal bead on next week. So, do I throw a few grand into short term option positions which could pay off (massively, like 4-10 to one), or do I use common sense and not bet against the house?
The first ‘trust’ question of the morning is do I trust reasonable researchers with no economic axe to grind, or The House which has been working over my wallet here lately? Lay on a straddle or strangle here? Hmmm…
Troubles of Japan
As we are getting hints of the ‘ill winds’ from the Japan accident circling the globe, showing up in Iceland, for example, a check of the www.radiationnetwork.com site reveals that you will still need your headlights on to drive at night in the US.
The situation in Japan is incrementally worse, though with a dangerous breach now suspected and reports of workers getting burned skin from standing in radioactive water without boots and such – hardly in keeping with the downplayed low risks which we’ve previously be reassured about.
Now we get to the trust question about Japan. I’m not the brightest economic bulb in the house, for sure, but I was struck by the Yes-Dollar chart on the Fed’s web site this morning:
Since one of our regular readers is a well-respected teaching PhD type who has lots of other initials after his name and teaches 600-level (and up) business classes, perhaps I could lay off the question as a ‘quicky report’ for grad students to submit for critiques?
The question which I’d like explained in 600-words or less is this: “How can a country which has just had its ass kicked with multiple nuclear accidents, a major infrastructure wrecking tsunami and damaged supply chains, have its currency value continue to increase in the face of such overwhelming damage?
The simple answer is probably either a) “Someone’s lying about sh*t or b) the markets are really dumber than we think and they will catch on next week and that’ll be Lammert’s albino black swan… but some details and supporting decision matrices, please to explain why your answer should be trusted.
You notice that the Japanese PM is calling the situation in country “grave”? Poor choice of words…or, does he know more than he’s letting on and doesn’t this get us back to that whole trust discussion?
But it’s all OK – the Bernank has promised to speak out more and explain policy better. Wait – haven’t I heard that somewhere before….oh yeah, where are those bank bailout amounts Bloomberg won the right to in court?
Banks & Banksters Dept.
So with Portugal banko’ed and Japan still in woods, what do you suppose is going on in the background with major banks and, in particular, with the government’s FDIC Insurance operation? How about a quickie summary from their CFO?
The attached report highlights the Corporation’s financial activities and results for the period ending December 31, 2010.
•During the fourth quarter of 2010, the Deposit Insurance Fund (DIF) balance increased by $657 million to negative $7.4 billion. This increase was primarily due to a $3.5 billion increase in assessments earned, offset by a $2.4 billion increase in provision for insurance losses and a $452 million increase in operating expenses.
•During the fourth quarter of 2010, the FDIC was named receiver for 30 failed institutions. The combined assets at inception for these institutions totaled approximately $8.9 billion with a total estimated loss of $2.1 billion. The corporate cash outlay during the fourth quarter for these failures was approximately $2.2 billion.
•Year-to-date through December 31, 2010, Corporate Operating Budget expenditures were below budget by 14 percent ($567.9 million). This variance was primarily the result of lower spending for contractual services and vacancies in budgeted positions in both the Receivership Funding and the Ongoing Operations components.
Say, you don’t think that FDIC has embarked on the same kind of trajectory which hit the Social Security “Trust” Fund, do you?
Doggone it! There’s that ‘trust’ word again.
So, how does this compare with the increase in goods & services made by our country here in the good ‘ol USA? Hand me this morning’s press release from the Bureau of Economic Analysis, wouldja?
Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 3.1 percent in the fourth quarter of 2010, (that is, from the third quarter to the fourth quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.6 percent.
The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was 2.8 percent (see “Revisions” on page 3).
The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, and nonresidential fixed investment that were partly offset by negative contributions from private inventory investment and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased.
So, if the GDP is going up 3.1% and the money printing is going up 11.3% annualized at M1, does that mean that Jas Jain, Lammert, and my other steely-eyed deflationists are right and that deflation is still here at 3.1% minus 11.3 percent) at 8.2%?
Or, is another way of thinking about it to say if food is going up at realistically at least 5% and M1 is going up 11.3% (M1) that inflation is only 6.3%?
Does that mean its good that food is going up because it offsets incipient inflation? And is that why they’re bombing Libya to keep inflation stoked so deflation doesn’t crash the system? Pinch me – ViseGrips, please.