Saturday, March 24, 2012
(Lindsey williams - proof Negative Show - 14 March 2012 ) is back with some more insights from his elite friends , some of the key points, are : in order to understand the elite's mind set you need to listen to the buzz words in this case the 'derivatives' which will bring the total collapse of the financial system and the death of the US Dollar by the end of 2012 , this does not mean that the dollar won't be existent, it means that it will lose most of its purchasing power (due to hyperinflation) there will be no shortages of food but the prices will be sky-high , prepare for $6 or $7 gas a gallon , Saudi Arabia is building the biggest oil refinery in world's history in china and soon it will be selling its oil to china without using the petro dollar aka the US dollar this will precipitate the death of the US Dollar
Like many analysts and economists I have been an avid follower of the Baltic Dry Index (BDI) as a so-called leading indicator of global economic activity. However, I have come to the conclusion that the BDI as such is of no further use to me. The massive growth in demand for commodities from especially China from 2005 to 2008 led to a significant increase in capacity as the number of ships built surged through until the 2010 crisis that resulted in a major change in supply from relatively inelastic to highly elastic. Furthermore, it means that changes in the Baltic Dry Index occur in what is essentially a downtrend or, put differently, in a bear market.
However, I have discovered an indicator that is far superior to the BDI. The HARPEX Index was developed by Harper Petersen, a global leading chartering agent. The Index is calculated by using the actual time charter rates for seven classes of ships. This index therefore measures the rates of moving mostly finished goods globally and is an excellent indicator of global consumer activity. Unfortunately the historical data on the website only date back to 2009. (http://www.harperpetersen.com/harpex/harpexVP.do)
In the graph below I depicted the HARPEX Index against my GDP-weighted Major Economies Manufacturing PMI as well as the Markit Eurozone PMI, with both the PMIs leading by two months. In the graph it is evident that the HARPEX Index should be rated highly as a coinciding indicator in any economic forecasting model. The value of manufacturing PMIs as leading indicator comes to the fore as it is evident that the GDP-weighted manufacturing PMI of the major economies leads the HARPEX Index by two months. The bottoming and subsequent rise of the PMIs in January this year indicated that the HARPEX Index would rise through end March. It has indeed risen from $376 at the end of February to $393 currently. The slight weakening of the major economies’ PMI in February indicates that freight rates in April are likely to go nowhere and even decline.
Sources: Harper Petersen; CFLP; Li & Fung; Markit; ISM; Plexus Asset Management.
The value of the HARPEX Index can be seen in the following graph. During the great financial crisis in 2008/2009 the HARPEX Index fell to $300 and remained relatively unchanged until February 2010. The global manufacturing sector started to expand in August 2009 when the GDP-weighted Major Economies Manufacturing PMI rose above the 50 level in August 2009. It therefore took six months of global expansion to take up the slack in the container shipping industry. Thereafter the PMI and the HARPEX Index moved in the same direction, with the PMI leading by approximately two months.
Sources: Harper Petersen; CFLP; Li & Fung; Markit; ISM; Plexus Asset Management.
The current level of the HARPEX Index is indicative of how weak the global manufacturing sector really is. This sector is still in a much better shape than in 2009 as the HARPEX Index is still 30% higher than the presumably $300 absolute minimum level at which ships can operate. In my opinion any further strength in the global manufacturing sector is likely to have an immediate impact on global containerized freight rates as the sector is not recovering from a deep recession as it did in 2009.
In a recent article I presented you with a graph of my calculated PMI seasonal factors of the CFLP Manufacturing for China against the Baltic Dry Index, which not only explained the weakness in the BDI but also the shorter-term movements in the BDI. I argued that January/February would also mean a seasonal low for the Baltic Dry Index and a major reversal would be evident in March and April.
Sources: CFLP; Li & Fung; I-Net Bridge; Plexus Asset Management.
The BDI subsequently made a low of 647 on 3 February and is currently at 897. Although the BDI is up 38.6% it is still a far cry from what it should normally have been in light of the usually strong seasonal period. It is therefore an indication of the underlying weakness of China’s manufacturing sector.
Although I argue that changes in the Baltic Dry Index occur in a bear market due to the underlying fundamental factors, the BDI should not be discarded in total as it does give an indication of the underlying strength of China’s manufacturing sector. I regard the HARPEX Index as a better coincident indicator of global economic activity.
- Does the company have the products or services with sufficient market potential to make possible a sizable increase in sales for at least several years?
- Does the management have a determination to continue to develop products or processes that will further increase sales when the growth potential of current product lines has largely been exploited?
- How effective are the company’s R&D efforts in relation to its size?
- Does the company have an above average sales organization?
- Does the company have a worthwhile profit margin?
- What is the company doing to maintain or improve profit margins?
- Does the company have outstanding labor and personnel relations?
- Does the company have outstanding executive relations?
- Does the company have depth to its management?
- How good are the company’s cost analysis and accounting controls?
- Are there other aspects of the business, somewhat peculiar to the industry, which will give the investor important clues as to how outstanding the company may be in relation to its competition?
- Does the company have a short range or long range outlook in regards to profits?
- In the foreseeable future, will the growth of the company require sufficient equity financing so that the larger number of shares then outstanding will largely cancel the existing stockholders’ benefit from this anticipated growth?
- Does the management talk freely to investors about its affairs when things are going well but “clam up” when troubles and disappointments occur?
- Does the company have a management of unquestionable integrity?
You can get a copy of Fisher’s book here. What questions do you ask yourself before investing?
Interview with John Perkins author of "Confessions of an Economic Hit Man" ."Confessions of an Economic Hit Man" author John Perkins argues that the United states has created a modern-day empire through the use of economic blackmail and the undermining of foreign governments.John Perkins spent three decades as an Economic Hit Man, business executive, author, and lecturer. He lived and worked in Africa, Asia, the Middle East, Latin America, and North America. Then he made a decision: he would use these experiences to make the planet a better place for his daughter's generation. Today he teaches about the importance of rising to higher levels of consciousness, to waking up - in both spiritual and physical realms - and is a champion for environmental and social causes. He has lectured at universities on four continents, including Harvard, Wharton, and Princeton.
Ellis Martin interviews David Morgan in the second of a three part discussion. Mr. Morgan recently posted a video on Youtube entitled, “Silver is the Achilles Heel to the Entire Economic System” http://www.youtube.com/watch?v=QHc4Vp4I9_I Mr. Martin chose to ask about the reasoning for putting together such a piece as well as attempting to identify the audience for such a message as well as the purpose for it. Is trading in silver and gold usurping the system? Dr. Ron Paul weighs in before Congress and Chairman Bernanke on the subject in the referenced video.
Sales of new homes in February fell from January but jumped more than 11 percent compared with the same month last year and prices rose, according to data released on Friday that was in line with other recent signs of a slow recovery.
Big challenges lie ahead, most notably in the form of a glut of unsold properties - many of them foreclosures - and tight lending by banks. But even if the recovery is slow and bumpy, the worst of the six-year slump seems to be over.
"The housing market is slowly coming back. It's still a depressed market, but it's getting better. We have a long way to go," said Patrick Newport, an economist at Global Insight in Lexington, Massachusetts.
New home sales slipped 1.6 percent to a seasonally adjusted 313,000-unit annual rate in February, the lowest since October, but were up 11.4 percent in year-on-year terms, the Commerce Department said.
The median new home price jumped 8.3 percent to an eight-month high of $233,700. Compared with February last year, the rise was 6.2 percent.
The report rounded off a week of mixed U.S. housing data and followed a similar pattern seen in the bigger market for existing homes - sales also fell in February, but stayed close to their highest level in nearly two years and prices rose for the first time on a yearly basis since November 2010.
Realtors say they are seeing higher traffic volume and are moving more houses off the market than a few years ago.
"My listings are selling much more quickly compared to the past few years, even approaching 2007 pre-crash levels," said Lindsey Sanders, a Realtor with Muffley & Associates in Atlanta.
"I began seeing a meaningful uptick in open house traffic last summer and it has continued to improve. I think this is a combination of sellers finally becoming more willing to ask market prices for their homes instead of bubble-level prices."
Builders tell a similar story. An index measuring confidence among homebuilders held at a near four-year high this month and they anticipated an increase in sales over the next six months.
While the pace of home construction fell last month, permits for future projects approached a 3-1/2-year high. Much of the activity is concentrated in the multi-family segment, as demand for rentals soars.
The recovery remains spotty. According to CoreLogic, for every two homes sold, there is one that could be foreclosed. It estimated the so-called shadow inventory of homes at 1.6 million in January, down from 1.8 million a year ago.
KB Home, the fifth-largest U.S. homebuilder, on Friday said net orders for new homes declined 8 percent in its first quarter as cancellations rose.
"Don't expect this to be a broad-based, rocket-ship recovery," said KB Homes Chief Executive Officer Jeff Mezger on an earnings call. "The overall housing market is better, but this is definitely a localized recovery ... and in some cases, it's a zip-code-by-zip-code recovery."
KB's order decline was in sharp contrast to the strong order growth reported by other U.S. homebuilders, including D.R. Horton, Pulte and Lennar, who have forecast an improving housing market.
While the pace of new home sales held above 300,000 units for a sixth straight month, they are just over a fifth of their 1.389 million unit peak reached in July 2005.
"Mindful that more healing needs to be done, we expect new home sales in 2012 to post their first annual increase in seven years, rising 12 percent," said Sam Bullard, a senior economist at Wells Fargo Securities in Charlotte, North Carolina.
Last month, the inventory of new homes on the market was unchanged at a record low 150,000 units. At February's sales pace it would take 5.8 months to clear the houses from the market, up from 5.7 months in January.
New home sales last month surged in the Northeast and West but slumped in the South and Midwest.
New home sales account for about 7 percent of the overall housing market and face stiff competition from the used home segment despite low levels of stock.
"Buyers have been able to take their time as they have little fear that prices or rates will get away from them. Mortgage rates, though, are beginning to rise slowly and that could continue through the rest of the year," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.
"Add price increases to that and there is a little more urgency to the decision. So while investors may be disappointed by this report, I think better times are just about here so be a little more patient."
Bob Chapman - The Financial Survival - 23 March 2012 : the next week should be a very good week for gold , Frau Merckel of Germany said that Germany would not add or extend the money available for the bailouts of the PIIGS countries in southern Europe...the insiders know that the bailouts won't work for Greece
The Oil Conundrum Explained
Oil as a commodity has always been a highly valuable early warning indicator of economic instability. Every conceivable element of our financial system depends on the price of energy, from fabrication, to production, to shipping, to the consumer’s very ability to travel and make purchases. High energy prices derail healthy economies and completely decimate systems already on the verge of collapse. Oil affects everything.
This is why oil markets also tend to be the most misrepresented in the mainstream financial media. With so much at stake over the price of petroleum, and the cost steadily climbing over the past year returning to disastrous levels last seen in 2008, the American public will soon be looking for someone to blame, and you can bet the MSM will do its utmost to ensure that blame is focused in the wrong direction. While there are, indeed, multiple reasons for the current high costs of oil, the primary culprits are obscured by considerable disinformation…
The most prominent but false conclusions on the expanding value of oil are centered on assertions that supply is decreasing dramatically, while demand is increasing dramatically. Neither of these claims is true…
The supply side of the oil equation is the absolute last factor that we should be worried about at this point. In fact, global oil use since the credit crisis of 2008 has tumbled dramatically. This decline accelerated at the end of 2011 and the beginning of 2012 all while oil prices rose:
In its February Oil Market Report, the International Energy Agency (IEA) forecast a reduction in the growth of demand into the Spring of 2012, despite reports from the mainstream media that oil prices were spiking due to “recovery” and “high demand”. Simultaneously, the IEA reported that petroleum inventories rose to the highest levels since October, 2008:
The Baltic Dry Index, which measures global shipping rates and the demand for freight in general, has fallen off a cliff in recent months, hovering near historic lows and signaling a sharp decline in world demand for raw materials used in production. A fall in the BDI has on multiple occasions in the past been a predictive indicator of stock market chaos, including that which struck in 2008 and 2009. A sharply lower BDI means low global demand, which should, traditionally, mean decreasing prices:
So, supply is high across the board, inventories are stocked, and demand is weak. By all common market logic, gasoline prices should be plummeting, and far more Americans should be smiling at the pump. Of course, this is not the case. Prices continue to rise despite deflationary elements, meaning, there must be some other factors at work here causing inflation in prices.
Ironically, stock market activity in the Dow has now come under threat from this inflationary trend in oil. Rising energy costs have essentially put a cap on the epic explosion of equities, and many mainstream analysts now lament over this Catch-22. The problem is that these investors and pundits are operating on the assumption that the Dow bull market is legitimate, and that the rally in oil is somehow an extension of a “healthier economy”. This version of reality, I’m afraid, is about as far from the truth as one can stretch…
In the candy coated world of Obamanomics, high priced stocks are a valid signal of economic growth, and oil is rising due to demand which extends from this growth. In the real world, stock values are completely fabricated, especially in light of record low trade volume over the past several months:
Low trade volume means very few investors are currently participating in active trade. This lack of investment interest in the markets allows big players (such as international bankers) to use their massive capital to swing stocks whichever way they choose, even to the point of creating false market rallies. Throw in the fact that the private Federal Reserve (along with helpful hands-off approach by our government) has been constantly infusing these banks with fiat printed from thin air, and one can hardly take the current ascension of the Dow or the S&P very seriously.
Another issue which should be stressed is the renewed tensions in the Middle East, namely, the very distinct possibility of an Israeli or U.S. strike in Iran, and the possibility of NATO involvement in Syria (which has extensive ties to Russia and Iran). Certainly, this is a tangible danger that would have unimaginable consequences in global oil markets. However, the threat of growing war in the Middle East is in no way a new one, and has been ever present for the past decade. It hardly explains why despite hollow demand and extreme supply, the price per barrel of oil has been an unstoppable rising tide. Attempts by Saudi Arabia to reverse inflationary trends by promising increased production in the wake of Iran turmoil has so far been ineffective.
Simultaneously, large oil reserves have been discovered off the coast of Greece:
Off the coast of Ireland:
Massive fields in Mongolia have been uncovered:
And of course, the vast shale oil fields in North Dakota and Montana are finally being tapped:
Oil supply has been ample and large oil reserves are being discovered yearly. Speculation would be the next obvious assumed culprit, and there are certainly some signals of such activity. Oil speculators traditionally use the forced accumulation of oil inventories to reduce market supply and artificially increase prices. Inventories have indeed been high. However, as previously stated, demand for oil has been static or fallen in most countries around the world since 2008, and there has been NO petroleum shortages due to manipulated markets. In fact, there have been no petroleum shortages period. Speculation has the potential to cause sharp but short term shifts in markets, but one must take into account the long term trend of a particular commodity to understand the root cause of its increasing or decreasing value. Again, inadequate supply is NOT the trigger for the ongoing oil price problem, whether by threat of war, or by reduction through speculation.
This schizophrenic disconnection between the stock market, and oil, and true supply and demand, is, though, a symptom of one very disturbing illness lurking in the backwaters of the U.S. fiscal bloodstream; dollar devaluation.
We all understand that the Federal Reserve has been engaged in non-stop quantitative easing measures in one form or another since 2008. We don’t know exactly how much fiat the Fed has printed in that time, and won’t know until a full and comprehensive audit is finally enacted, but we do know that the amount is at the very least in the tens of trillions (be sure to check out page 131 of the GAO report below to find their breakdown of Fed QE activities. This is just the money printing that has been ADMITTED TO, in excess of $16 trillion):
The dollar is being thoroughly squashed. Why is this not showing in the dollar forex index? The dollar index is yet another example of a useless market indicator, being that it measures dollar value relative to a basket of world fiat currencies, ALL of which also happen to be in decline. That is to say, the dollar appears to be vibrant, as long as you compare it to similarly worthless paper currencies that are being degraded in tandem with the greenback. Once you begin to compare the dollar to commodities, however, it soon shows its inherent weakness.
The dollar’s only saving grace has long been its status as the world reserve currency and its use as the primary trade mechanism for oil. This, however, is changing.
Bilateral trade agreements between China, Russia, Japan, India, and other countries, especially those within the ASEAN trading bloc, are slowly but surely removing the dollar from the game as these nations begin to replace trade using other currencies, including the Yuan. I believe commodities, especially oil, have been reflecting this trend for quite some time. The consequences of the dollar’s ties to oil are detrimental to all nations that consume petroleum, and they are clearly moving to insulate themselves from further devaluation.
Even after the release of strategic oil reserves back in the summer of 2011 in an effort to dilute prices, and the announcement of an even larger possible release of reserves this month, oil has not strayed far from the $100 per barrel mark. High Brent crude price have held for years, even after numerous promises from government and media entities admonishing what they called “speculation”, and promises of a return to lower energy costs. Not long ago, $100 per barrel oil was an outlandish premise. Today, it is commonplace, and some even consider it “affordable” compared to what we may be facing in the near future, all thanks to the steady deconstruction of the last pillar of the U.S. economy; the dollar, and its world reserve label.
Ultimately, no matter how manipulated and overindulged the stock market becomes, no matter how many fiat dollars are injected to prop up our failing system, the price of oil is the great game changer. As inflation is reflected in its price, and energy costs burn out of control, the Dow will begin to fall, regardless of any low volume or quantitative easing. In all likelihood, this conundrum will be blamed on as many scapegoats as are available at the moment, including Iran, or China, or Russia, or Japan, etc. Each and every American, and especially those involved in tracking the economy, will have to remind themselves and the public that at bottom, it was the Federal Reserve that created the conditions by which we suffer, including currency devaluation and high oil prices, NOT some foreign enemy.
The one positive element of this entire disaster (if one can call anything “positive” in this mess), is the manner in which the high price of oil tends to dash away the illusions of the common citizen. It is an issue they simply cannot ignore, because it affects every aspect of their lives in minute detail. Costly energy awakens the otherwise ignorant, and forces them to see the many dangers lurking on the horizon. Hopefully, this awakening will not be too little too late…
The United States is just over 230 years old and is now firmly entrenched in the seventh stage of all civilizations (Apathy) with only Dependence and eventually Bondage ahead of it. Apathy is the glove into which evil slips its eager hand
The average age of the world’s greatest civilizations has been two hundred years. These nations have progressed through a nine stage sequence: From bondage to spiritual faith; from spiritual faith to great courage; from courage to liberty; from liberty to abundance; from abundance to selfishness; from selfishness to complacency; from complacence to apathy; from apathy to dependence; from dependency back again into bondage.
In our present Plutocracy we have just made the transition from complacency to national apathy ~ which will surely be followed by dependence on the state and eventually bondage by the state. As Ramsey Clark, former U.S. Attorney General, has said ~ ”We’re not a democracy. It’s a terrible misunderstanding and a slander to the idea of democracy to call us that. In reality, we’re a plutocracy: a government by the wealthy.”
The obvious vehicle for this rapid shift in consciousness is FEAR and APATHY. FEAR, in actuality, is False Exaggerations Appearing Real (under the guise of National Security) but APATHY is a lack of interest and indifference and it has always been the Great American Sin.
Joseph Fort Newman, Atlantic Monthly, wrote about the Great American Sin of Apathy in October, 1922 ~ and it’s worth repeating now in March, 2012;
”What is the great American sin? Extravagance? Vice? Graft? No; it is a kind of half-humorous, good-natured indifference, a lack of “concentrated indignation” as my English friend calls it, which allows extravagance and vice to flourish. Trace most of our ills to their source, and it is found that they exist by virtue of an easy-going, fatalistic indifference which dislikes to have its comfort disturbed….The most shameless greed, the most sickening industrial atrocities, the most appalling public scandals are exposed, but a half-cynical and wholly indifferent public passes them by with hardly a shrug of the shoulders; and they are lost in the medley of events. This is the great American sin.”
Unless we as individuals, and then as a nation, conquer fear and apathy we are doomed to dependence and then bondage by a state ruled by the wealthy. That state of dependence is drawing near and only faith and the great courage of civil revolt and even civil disobedience can revitalize this nation ~ particularly with a major economic depression already underway.
Paul Fay, Real News, interviews Col. Lawrence Wilkerson on the fact that Obama, Panetta and Holder are undermining basic constitutional rights by justifying killing American citizens without judicial process and bypassing Congress in declaring war without congressional approval ~ and always under the guise of national security. Wilkerson expounds that the executive branch of the government has seized power contrary to the voice of the people which will eventually lead to tyranny ~ “The more power you accumulate, the more likely you will abuse it” 11 minute video:
And Tyranny and Dependence is the eighth step in the fall of civilizations ~ only to be followed by Bondage. In many ways George Orwell’s Oceania has nothing on 2012 America as Paul Joseph Watson wrote last year in Infowars.com ~ “Americans are now living in a society that in some cases is more draconian, more invasive and more Orwellian than the dystopian tyranny fictionalized in Orwell’s chilling classic Nineteen Eighty-Four. On almost every front, American citizens are under an equal or greater threat of abuse, control and more pervasive and high-tech surveillance than anything Winston Smith ever faced.”
And here’s the proof that Oceania is almost here ~ Wired magazine’s April cover story covers the current construction of the blandly named Utah Data Center ~ which is being built for the National Security Agency. “A project of immense secrecy, it is the final piece in a complex puzzle assembled over the past decade. Its purpose: to intercept, decipher, analyze, and store vast swaths of the world’s communications as they zap down from satellites and zip through the underground and undersea cables of international, foreign, and domestic networks. The heavily fortified $2 billion center should be up and running in September 2013…. It is, in some measure, the realization of the “total information awareness” program created during the first term of the Bush administration ~ an effort that was killed by Congress in 2003 after it caused an outcry over its potential for invading Americans’ privacy.” Read full report ~
In other words, in just over one year, virtually anything one communicates through any traceable medium ~ which these days is virtually everything ~ will unofficially be property of the US government to deal with as it sees fit.
The codename of the project is Stellar Wind.
As Wired says, “there is no doubt that NSA has transformed itself into the largest, most covert, and potentially most intrusive intelligence agency ever created.”
William Binney, a former NSA official as well as senior NSA crypto-mathematician largely responsible for automating the agency’s worldwide eavesdropping network, has gone on record (in Wired) to describe Stellar Wind, and offers the best summation of its consequences to all Americans ~ “We are, like, that far from a turnkey totalitarian state.”.
And thus the stage will soon be set for America’s shift from Apathy to the eighth stage of a civilization’s collapse, Dependence on the State which will be quickly followed by Bondage to the State and Orwell’s prophetic words will finally become a reality ~ “There was of course no way of knowing whether you were being watched at any given moment. How often, or on what system, the Thought Police plugged in on any individual wire was guesswork. It was even conceivable that they watched everybody all the time. But at any rate they could plug in your wire whenever they wanted to. You had to live ~ did live, from habit that became instinct ~ in the assumption that every sound you made was overheard, and, except in darkness, every movement scrutinized.”
If you’re not outraged, you’re on life support.