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“Recessionary” Demand Forces New York Harbor To Divert Gasoline Shipments

“Recessionary” Demand Forces New York Harbor To Divert Gasoline Shipments

Two weeks ago, Goldman analysts were stunned when they noted that in recent weeks gasoline demand in the US has collapsed to levels that suggest not all is well with the economy. In fact, as the bank’s oil expert Damien Courvalin said “to achieve the 5.9% decline suggested by the weekly data, our model requires PCE to contract 6%, in other words, a recession.”

Goldman then quickly changed the unpleasant narrative – one which would suggest that the US economy is in far worse shape than official data represent – and provided several alternative explanations why such a “sudden collapse is unlikely” and said that “we view the larger than seasonal ytd builds in US gasoline stocks as driven by transient supply factors rather than persistent demand issues.”

Perhaps, but so far those “transient” supply factors are only getting more chronic, and as supply continues to grow in anticipation of a demand bounce that refuses to materialize, leading to ever louder speculation that there is something very wrong with the US consumer…

… gasoline inventories have hit record levels, and nowhere is this more obvious than on the East Coast, where as Bloomberg writes overnight, “the biggest gasoline market in the U.S. is bursting at the seams.”

As a result, just like during last year’s unprecedented gasoline glut which, too, was supposed to be “transient”, but has only gotten worse, traders are now lining up to export gasoline and diesel from New York Harbor, an area that normally relies on fuel imports from Europe and eastern Canada.

While at least 6 cargoes that were headed to New York from Europe in January and early February were diverted to the Caribbean or the U.S. Gulf Coast, that wasn’t enough to stem the oversupply building up in terminals along the Eastern Seaboard. Record-high inventories in the region are now pushing prices low enough to turn the typical trade flow on its head.

…click on the above link to read the rest of the article…

Kyrgzstan’s Central Bank Urges Citizens To Own Gold

Kyrgzstan’s Central Bank Urges Citizens To Own Gold

Gold can be stored for a long time and, despite the price fluctuations on international markets, it doesn’t lose its value for the population as a means of savings,” Kyrgyzstan’s Central Bank Governor Tolkunbek Abdygulov said, “I’ll try to turn the dream into reality faster.”

A landlocked nation perched between China and Kazakhstan is embarking on an experiment with little parallel worldwide: shifting savings from cattle to goldAs Bloomberg reports,

One of the first post-Soviet republics to adopt a new currency and let it trade freely, Kyrgyzstan’s central bank wants every citizen to diversify into gold. Governor Tolkunbek Abdygulov says his “dream” is for every one of the 6 million citizens to own at least 100 grams (3.5 ounces) of the precious metal, the Central Asian country’s biggest export.

In the two years that the central bank has offered bars directly to the population, about 140 kilograms of bullion have been sold, Abdygulov, 40, said by phone from the capital, Bishkek.

“We are hopeful that our country’s population will learn to diversify its savings into assets that are more liquid and — more importantly — capable of retaining their value,” he said. In rural areas, cattle is still the asset of choice for investors and savers, according to Abdygulov.

What makes Kyrgyzstan unique is the central bank’s effort to win converts by providing infrastructure for safe-keeping and investment. The central bank produces bars of different sizes, varying in weight from 1 to 100 grams.

The central bank governor believes his plan is realistic, even though it means the population would own about 600 tons of gold, equivalent to 30 times the nation’s current annual output. Abdygulov declined to specify the timeframe for when his goal of 100 grams per person can be met.

…click on the above link to read the rest of the article…

Glenn Greenwald Tells Truth About DNC: Nancy Pelosi and Chuck Schumer Leading Collapsed Party of Shills

Glenn Greenwald Tells Truth About DNC: Nancy Pelosi and Chuck Schumer Leading Collapsed Party of Shills

Glenn Greenwald appeared on Tucker Carlson Tonight Wednesday for yet another truth bombing after The Intercept co-founder, attorney, and author penned an article on the deeply flawed DNC’s inability to cope with loss. As Greenwald and others have pointed out since the election, Democrats seem to have a major problem with introspection. I get it – admitting fault means being wrong, and for a party built upon emotionalism and condescending moralization instead of facts and common sense, being wrong strips the self-righteous DNC of the one argument they’ve built their entire platform on; we’re right because we say we are.

From Greenwald’s article:

A failed, collapsed party cannot form an effective resistance. Trump did not become president and the Republicans do not dominate virtually all levels of government because there is some sort of massive surge in enthusiasm for right-wing extremism. Quite the contrary: This all happened because the Democrats are perceived — with good reason — to be out of touch, artificial, talking points-spouting automatons who serve Wall Street, Silicon Valley, and the agenda of endless warled by millionaires and funded by oligarchs to do the least amount possible for ordinary, powerless citizens while still keeping their votes.

Enjoy:

https://youtu.be/mQ33PuiC6wY

Jim Rogers: “We’re About To Have The Worst Economic Problems Of A Lifetime, A Lot Of People Will Disappear”

Jim Rogers: “We’re About To Have The Worst Economic Problems Of A Lifetime, A Lot Of People Will Disappear”

“Get prepared,” warns billionaire commodity guru Jim Rogers, “because we’re going to have the worst economic problems in your lifetime and a lot of people are going to disappear.” In this wide-ranging interview with MacroVoices’ Erik Townsend, the investing legend discusses everything from whether Russia is being scapegoated (“yes, ask Victoria Nuland”), the war against cash (“governments love it… they want to control everything”), to his views on gold and the demise of freedom.

Full podcast below:

Key Excerpts…

Are Russians the bad guys?

Well I do know that during the last administration, Mr. Obama’s administration as you probably remember we started, we tried to pull of an illegal coup in Ukraine, we got caught at it, what’s her name, Victoria Nuland, whatever the woman’ name the State Department they have there several pieces of evidence where we know she tried to instigate an illegal coup then of course the Russians outsmarted us and so the State Department started blaming it on the Russians and the hype against the Russians has gotten bigger and bigger ever since after we started– or tried to start, tried to instigate the illegal coup Crimea and Ukraine.

So yes we are certainly at fault to some extent and obviously you then, when you’re caught you’ve got to keep the rhetoric up and keep throwing more and more accusations and so the State Department has done that.

I know that before the illegal coup Obama, Bush everybody was trying to be friends with the Russians rightly so, cold war had ended long ago, the Russians wanted to be friends with America. We didn’t need NATO anymore.

…click on the above link to read the rest of the article…

There Are 66,719 Empty Mansions In Vancouver

There Are 66,719 Empty Mansions In Vancouver

One year ago, when we first started discussing the Vancouver housing bubble, which as we first speculated – and was later confirmed – was the result of Chinese oligarch money-launderers parking “hot cash” in this offshore housing market (at least until a 15% property tax on foreign purchases made Seattle the new Vancouver), we said that Vancouver houses had become the de facto new Swiss bank account, and because of that the houses – once purchased – would remain a highly overprized, if vacant tribute to China’s soaring capital outflows.

Now, courtesy of data by urban planner Andy Yan of Simon Fraser University’s City Program, this has been confirmed because according to the latest census numbers, as of 2016 there were 25,502 unoccupied or empty housing units in the City of Vancouver. Expanding to include the entire metro area, Yan found that vacant or temporarily occupied dwellings have more than doubled since 2001 to 66,719 last year as neighborhoods have hollowed out.


A home sits empty, and awaiting demolition, at the corner of Parker Street 

and Victoria Drive in Vancouver on Wednesday

Yan compared census data for Vancouver over several decades to see how the percentage of “unoccupied” units or ones “occupied solely by foreign residents and/or temporary present residents on Census Day” has doubled during that time the Vancouver Sun reported. In 1986, it was 4%. By 2016, it had doubled to 8.2%.

“Exact definitions and measures have changed slightly over 30 years and patterns should be interpreted as directional,” Yan writes in a report released Wednesday.

The number of Vancouver’s prized, if vacant, mansions far outstrips other municipalities with 25,502 units that are either unoccupied or owned by temporary or foreign residents.

Yan said most of these were concentrated in three areas: Coal Harbour, Marine Gateway and Joyce-Collingwood. Surrey came in second at 11,195, Burnaby at 5,829 and Richmond at 4,021.

…click on the above link to read the rest of the article…

Carbon Taxes, Cow Farts, And Central Planning

Carbon Taxes, Cow Farts, And Central Planning

In a centrally planned economy decisions on what to produce, how to produce and for whom are taken primarily by the government.

The term is usually associated with communist economies. However, since US President Franklin D. Roosevelt implemented a robust range of government policies in the 1930s to counter the effects of the Great Depression, using principles that would be popularized by UK economist John Maynard Keynes, Western governments (along with their central bank consorts) have also taken on very interventionist roles in economic affairs.

But not even Stalin or Roosevelt could come up with a rather exotic tool that can take central planning to a whole new level: carbon taxes.

The reason why it is so powerful is that virtually all market activities produce some type of greenhouse gas, meaning carbon and other equivalents that contribute to warming our planet. Here’s the emissions breakdown by sector in the US according to the Environmental Protection Agency (as of 2014):

Virtually all economic activities (as well as most daily personal affairs in any modern society) produce some type of emissions. So by putting a cost on carbon any of them, from the most mundane to the most complex, would be impacted. Entire industries could be impaired with the stroke of a pen. Powerful stuff indeed.

Furthermore, the tax base could be greatly expanded as a result, at a time when governments are desperate for new sources of revenue.

Climate change skeptics, pointing to alleged gaps in the theory of manmade climate change (where carbon emissions resulting from human activity are primarily responsible for the rise in global temperatures since the 19th century) and the heavily politicized nature of the process have long argued that having such a powerful interventionist tool is really the ultimate goal of the politicians pushing for it.

…click on the above link to read the rest of the article…

Tsipras Warns IMF, Schauble To “Stop Playing With Fire” Over Greek Debt

Tsipras Warns IMF, Schauble To “Stop Playing With Fire” Over Greek Debt

One day after Greek 2Y bond yields tumbled following press reports that for the first time in the latest Greek mini-crisis, the IMF and Eurozone creditors finally agreed on a “common stance” regarding what the Greek fiscal surplus and debt profile would look like, despite talks between Greece and its creditors ending in Brussels with no breakthrough, Greek PM Alexis Tsipras on Saturday warned the IMF and German Finance Minister Wolfgang Schaeuble to “stop playing with fire” in handling his country’s debt.

Nonetheless, striking a positive tone, Tsipras opened a meeting of his Syriza party by saying he was confident a solution would be found, and urged a change of course from the IMF. “We expect as soon as possible that the IMF revise its forecast so that discussions can continue at the technical level”, AFP reported, suggesting that contrary to initial reports, the bid-ask between the Troika and Greece still remains irreconcilable .

Tsipras also attacked Greek nemesis Wolfgang Schauble – who earlier in the week ruled out a Greek debt cut, saying “for that Greece would have to exit the currency area”- and called for German Chancellor Angela Merkel to “encourage her finance minister to end his permanent aggressiveness” towards Greece.

As documented before, ongoing feuding with the IMF has raised fears of a new debt crisis. Greece, whose economic collapse is now worse than the US Great Depression – remains embroiled in a row with its eurozone paymasters and the IMF over debt relief and budget targets that has rattled markets and revived talk of its place in the euro. 

A silver lining emerged on Friday, when Eurogroup chief Jeroen Dijsselbloem said progress had been made in the Brussels talks with Greek Finance Minister Euclid Tsakalotos and other EU and IMF officials. But he provided few details.

…click on the above link to read the rest of the article…

Air-Force Test-Launches Minuteman ICBM From California

Air-Force Test-Launches Minuteman ICBM From California

The rattling of sabres grows ever louder. Military.com reports that the Air Force says an unarmed Minuteman 3 missile has been launched from California’s central coast in the latest test of the intercontinental system.

The missile blasted off at 11:39 p.m. PDT Wednesday from Vandenberg Air Force Base northwest of Los Angeles.

The Air Force says the missile carried test re-entry vehicles that headed for a target area 4,200 miles away to the Kwajalein Atoll in the Marshall Islands in the Pacific Ocean.

The Air Force routinely uses Vandenberg to test Minuteman missiles from bases around the country.

This test involved personnel from Vandenberg’s 576th Flight Test Squadron and the 91st Missile Wing, Minot Air Force Base, North Dakota.

In this photo provided by U.S. Air Force, an unarmed Minuteman III intercontinental ballistic missile launches during an operational test on Saturday, Feb. 20, 2016 at Vandenberg Air Force Base, Calif.

Midwest Farm Bubble Continues Collapse As Farm Incomes Expected To Crash In 2017

Midwest Farm Bubble Continues Collapse As Farm Incomes Expected To Crash In 2017

Earlier this week the U.S Department of Agriculture released its biannual report of farm incomes which paints a very bleak picture for the American farmer.  In its first forecast for 2017, the USDA sees real farm cash receipts down 14% versus 2015 and 36% from the previous high set in 2012 as farm debt continues to soar and leverage surges to all-time highs.  

As the Wall Street Journal notes, the deadly combination of rising input costs, lower grain prices, a strong dollar and excessive leverage will likely force many of America’s Midwest farmers out of business in 2017.

Costs for seeds, fertilizer and equipment climbed so high and grain prices dropped so low that he still lost more than $120 an acre. Afraid to come up short again, Mr. Scott decided last fall not to plant 170 acres of winter wheat, close to a third of the usual amount. U.S. farmers sowed the fewest acres of winter wheat this season in more than a century.

“No one just grain farms anymore,” said Deb Stout, whose sons Mason and Spencer farm the family’s 2,000 acres in Sterling, Kan., 120 miles east of Ransom. Spencer also works as a mechanic, and Mason is a substitute mailman. “Having a side job seems like the only way to make it work,” she said.

The and her husband have declared bankruptcy before. Farmers around Sterling lost $6,400 on average in 2015, the latest available data, after profits of $80,800 a year earlier, according to the Kansas Farm Management Association.

Farms

Meanwhile, America’s share of the global grain trade has been cut in half since the 1970’s giving domestic farmers less control over pricing which has grown increasingly volatile over the past decade.

…click on the above link to read the rest of the article…

Grant Williams: The Death Of The Petrodollar, And What Comes After

Grant Williams: The Death Of The Petrodollar, And What Comes After

In December, Grant Williams, author of “Things That Make You Go Hmm…” offered the most comprehensive analysis yet of the rise and inevitable fall of the petrodollar (and implicitly US hegemony). In the following presentation, from Mines & Money Conference in London in December 2016, Williams focuses on gold’s performance in 2016, the reaction to Donald Trump’s election and joins a series of dots that may lead to the end of the petrodollar system and a new place for gold in the global monetary system.

Grab a glass fo wine – turn off Trump’s twitter feed for 30 minutes and enjoy. Here is the full presentation – “Get It. Got It. Good”

This presentation follows on from his “Nobody Cares” analysis.

*  *  *

The story begins in the 1970s when Henry Kissinger and Richard Nixon struck a deal with the House of Saud — a deal which gave birth to the petrodollar system.

The terms were simple The Saudis agreed to ONLY accept U.S. Dollars in return for their oil and that they would reinvest their surplus dollars into U.S. treasuries.

In return, the U.S. would provide arms and a security guarantee to the Saudis who, it has to be said, were living in a pretty rough neighbourhood. As you can see, things went swimmingly (chart below)

Saudi purchases of treasuries grew along with the oil price and everyone was happy.  (We’ll come back to that blue box on the right shortly)

The inverse correlation between the dollar and crude is just about as perfect as one could expect (until recently that is… but again, we’ll be back to that).

And, as you can see here, beginning when Nixon slammed the gold window shut on French fingers and picking up speed once the petrodollar system was ensconced, foreign buyers of U.S. debt grew  exponentially.

…click on the above link to read the rest of the article…

Over 100 Dead Amid Violence, Looting As Brazil Police Strike Sparks Chaos, Anarchy

Over 100 Dead Amid Violence, Looting As Brazil Police Strike Sparks Chaos, Anarchy

In a tragic development one would expect to see play out in its economically devastated northern neighbor, Venezuela, more than 100 people have been reported killed in violence and looting during a six-day strike by police in the Brazilian state of Espirito Santo, resulting in public chaos and anarchy, with schools and businesses closed and public transportation frozen.


Police officers patrol the perimeter at the scene of a fatal shooting in Vila Velha, Espirito Santo, Brazil 

In a scene out of a MadMax prequel, the Brazilian army mobilized airborne troops and armored vehicles on Thursday to reinforce the roughly 1,200 soldiers and federal police trying to contain the chaos in the coastal state north of Rio de Janeiro. Most of the violence was centered in the state capital Vitoria, a wealthy port city ringed by golden beaches and filled with mining and petroleum companies.

With the country’s economy continuing to crater as a result of record unemployment, soaring inflation, leading to a record high murder rate in the tourism capital Rio, police in Espirito Santo are demanding a pay rise amid an economic downturn that has hammered public finances in Brazil, with many states struggling to ensure even basic health, education and security services.


Police officers patrol the perimeter at the scene of a fatal shooting in Vila Velha, Espirito Santo

As a Reuters report recounts, soldiers patrolled abandoned streets in downtown Vitoria, stopping and frisking the occasional pedestrian against shuttered store fronts. State officials said they needed hundreds more federal troops and members of an elite federal police force to help establish order and make up for the absence of some 1,800 state police who normally patrol Vitoria’s metropolitan area.


Policemen carry a body at the Institute of Forensic Science in Vitoria, Espirito Santo 

…click on the above link to read the rest of the article…

Swiss National Bank’s U.S. Stock Holdings Hit A Record $63.4 Billion

Swiss National Bank’s U.S. Stock Holdings Hit A Record $63.4 Billion

Being able to print your own money and buy stocks at any price sure can be fun. Just as the SNB which unlike many other (if ever fewer) central banks admits to doing just that.

In its latest 13F filing, the Swiss National Bank reported that the value of its portfolio of US stocks rose again in the fourth quarter, increasing by 1.6% from $62.4 billion as of Sept. 30 to a record high $63.4 billion at the end of the year. 

Over the past two years, the total Assets under management of this massive hedge fund, which occasionally engages in massive currency manipulation with disastrous results, have increased from $26.7 billion to $63.4 billion, a 138% increase, mostly as a result of relentless currency manipulation and monetization of various assets, including both bonds and stocks.

In its latest 13F, the SNB reported stakes in 2,564 companies, up from 2,536 in the previous quarter.

SNB policy makers, among them Governing Board Member Andrea Maechler, have said many times that they invest for the benefit of monetary policy, replicating broad-based indexes, and not to generate a profit, although with the S&P500 at all time highs, they have also achieved that. The SNB excludes some companies on ethical grounds, according to Bloomberg.

The SNB’s biggest holdings as of December 31 were the following:

But the biggest surprise in the latest filing – aside from a central bank admitting to buying stocks of course – is that for the second consecutive quarter, the amount of AAPL shares, the SNB’s top position, has actually declined, dropping to 15 million as of Dec. 31, from a peak of 15.6 million as of June 30. The value, however remained roughly unchanged making some wonder if the SNB may have hit its limit when it comes to US equity allocation, if only for the time being.

…click on the above link to read the rest of the article…

Explosion At French Nuclear Power Plant, No Risk Of Nuclear Contamination

Explosion At French Nuclear Power Plant, No Risk Of Nuclear Contamination

French authorities said an explosion occurred at the EDF-operated Flamanville Nuclear Power Plant in France’s north-west, in the power plant’s machine room, but added that there is no leak of radiation. The incident occurred at 10:00 local time (09:00 GMT) in an engine room, Ouest-France newspaper reported. No injuries have been reported.

“It is a significant technical failure but it is not a nuclear accident” because the explosion occurred “outside the nuclear zone,” Olivier Marmion, director of the prefect’s office, told AFP.

The local government for the Manche region says that the blast at the Flamanville plant on France’s northwest coast has been contained and managed.

Operator EDF said that there were no injuries and that a fire led to a blast in the machine room of one of the two nuclear reactors at Flamanville. According to EDF, the fire started at 9:40am and caused an explosion in the machinery room. The fire happened in part of plant linked to reactor 1, which was disconnected from the grid, and was immediately controlled by plant’s crew;

The nuclear plant located in the Flamanville commune has two pressurized water reactors that produce 1.3 GWe (gigawatt electrical) each. The reactors were built in 1986 and 1987. A third reactor will be completed by 2018.

Chinese Banks Begin To Raise Mortgage Rates

Chinese Banks Begin To Raise Mortgage Rates

Raising rates on reverse repos, hiking the cost it charges on its Medium-Term Loan Facility and Standing Lending Facility, five consecutive day without a reverse repo liquidity injection (or rather a CNY715 billion liquidity drain), and now in the latest indication of overall tightening of monetary conditions, China has started to hike mortgage rates.

According to press reports, some bank branches in Beijing, Guangzhou and Chongqing have raised mortgage rates for first-home buyers recently. The China Securities Journal confirms as much, reporting that China’s banks in some big cities have started to lower discounts on lending rates for fist-time home buyers, joining recent steps to curb financial risks stemming loose credit conditions.

Following up on the Chinese report, Reuters notes that since the start of 2017, banks in Beijing have started discounting mortgage rates as much as 10 percent off the official benchmark rate, reducing from as much as 15 percent previously, CSJ said on its website. The current one-year benchmark lending rate set by the People’s Bank of China is at 4.35 percent, the lending rate for loans up to five years is at 4.75 percent and loans longer than 5 years is at 4.9 percent.

Few lenders in Beijing and Shanghai still offer mortgage rate discounts more than 10 percent off the benchmark, the Chinese paper said. “There are indications that the financial environment for the property market will no longer be loose in 2017,” it said.

In the southern city of Guangzhou, for example, the Postal Savings Bank, Industrial Bank and Rural Commercial Bank have also adjusted discounts on mortgage rates to as much as 10% off the benchmark rate from as much as 15%, the paper said.

…click on the above link to read the rest of the article…

Russia Mobilizes S-400 Missiles Systems Near Moscow To “Test Readiness Against A Possible Attack”

Russia Mobilizes S-400 Missiles Systems Near Moscow To “Test Readiness Against A Possible Attack”

One month ago we reported that Russia had deployed S-400 air defense missile systems in proximity to Moscow, which were then put on combat duty. “The SAM combat squads of the Moscow Region aerospace forces have put the new S-400 Triumph air defense missile system into service, and have gone on combat duty for the air defense of Moscow and the central industrial region of Russia,” the Defense Ministry’s Department of Information and Mass Communication told Interfax in early January.

While the ministry did not explicitly state why the rollout was taking place, it added that “the main task of the anti-aircraft missile troops of the Russian Aerospace Forces is air defense and protecting vital state, military, industry and energy facilities, as well as the Armed Forces troops and transport communications, from aerospace attacks.”

Fast forward one month, when overnight the missile systems in proximity to Moscow got their first real test, when air defense systems around Moscow were put on high alert Wednesday as part of a surprise nationwide combat readiness drill for the Russian Air Force which was meant to “test how prepared Russia is to repel a possible attack.“

 “Units of the air defense force responsible for defending Moscow and the central industrial region have been put on highest combat alert,” the Russian Defense Ministry said in a statement. “The air defense mission involves fully-manned combat crews.”

A part of the test, the ministry added, involved the redeployment of batteries of S-300, S-400 and Pantsir-S air defense systems to backup positions in a simulation of area contamination. The guards of the batteries also conducted anti-saboteur maneuvers and trained to operate in hard terrain.

…click on the above link to read the rest of the article…

Olduvai II: Exodus
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Olduvai
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Olduvai II: Exodus
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Olduvai III: Cataclysm
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