Abe Approval Tumbles As Majority Say Japan’s “Banzainomics” QE Will Have Negative Effects

Remember that for all the hollow rhetoric about this and that, the main reason why the Fed first tapered and then ended QE is because it literally ran out of bonds to monetize: as first Zero Hedge and then the TBAC warned last summer, and as we saw on October 15, the liquidity in the bond market dropped so much thanks to the Fed’s endless attempts to “fix the economy and the middle class” that the $12 trillion bond market flash crashed forcing market participants to pull a page right out of the May 2010 playbook and “turn those machines back off.”
Furthermore, the reason why the task of carrying the weight of the developed world’s flow was put on the shoulders of Japan, is that while the country is now an official economic basket case, at least it has a lot of Treasurys to monetize.

This post was published at Zero Hedge on 11/10/2014.

The Fed’s Stock Market Casino | Bob Murphy

The following video was published by FinanceAndLiberty.com on Nov 10, 2014
Jeff Deist and Robert P. Murphy address the vital topic of Fed interference in financial markets. Are the global equity and bond markets a charade, engineered by monetary expansion and destined to collapse like a house of cards? Is the investing game basically rigged? How can Janet Yellen and financial elites keep markets from crashing without endless new rounds of quantitative easing? Why is understanding Austrian economics necessary, but not sufficient, to be a successful investor? And how would stock markets have a social function in a free society? Anyone interested in investing, personal finance, Austrian economics, and the wit and wisdom of Bob Murphy will enjoy this show.

Gold Seeker Closing Report: Gold and Silver Fall Over 2% and 1%

The Metals:
Gold fell steadily throughout most of world trade and ended near its late session low of $1147.31 with a loss of 2.2%. Silver slipped to as low as $15.496 and ended with a loss of 1.14%.
Euro gold fell to about 925, platinum lost $20 to $1193, and copper fell a few cents to about $3.01.
Gold and silver equities fell throughout most of trade and ended with about 6% losses.

This post was published at GoldSeek on 10 November 2014.

Petrodollar Panic? China Signs Currency Swap Deal With Qatar & Canada

The march of global de-dollarization continues. In the last few days, China has signed direct currency agreements with Canada becoming North America’s first offshore RMB hub, which CBC reports analysts suggest “could double maybe even triple the level of Canadian trade between Canada and China,” impacting the need for Dollars. But that is not the week’s biggest Petrodollar precariousness news, as The Examiner reports, a new chink in the petrodollar system was forged as China signed an agreement with Qatar to begin direct currency swaps between the two nations using the Yuan, and establishing the foundation for new direct trade with the OPEC nation in the very heart of the petrodollar system. As Simon Black warns, “It’s happening… with increasing speed and frequency.”

This post was published at Zero Hedge on 11/10/2014.

If Everything Is Just Fine, Why Are So Many Really Smart People Forecasting Economic Disaster?

The parallels between the false prosperity of 2007 and the false prosperity of 2014 are rather striking. If we go back and look at the numbers in the fall of 2007, we find that the Dow set an all-time high in October, margin debt on Wall Street had spiked to record levels, the unemployment rate was below 5 percent and Americans were getting ready to spend a record amount of money that Christmas season. But then the very next year the worst economic crisis since the Great Depression shook the entire planet and everyone wondered why most people never saw it coming. Well, now a similar pattern is unfolding right before our eyes. The Dow and the S&P 500 both hit record highs on Monday, margin debt on Wall Street is hovering near record levels, the unemployment rate has ticked down a little bit and Americans are getting ready to spend more than 600 billion dollars this Christmas season. The truth is that the economy seems pretty stable for the moment, and most people cannot even imagine that an economic collapse is coming. So why are so many really smart people forecasting economic disaster in the near future?
For example, just consider what the Jerome Levy Forecasting Center is saying. This is an organization with a tremendous economic forecasting record that goes all the way back to the Great Depression. In fact, it predicted ahead of time the financial trouble and the recession that would happen in 2008. Well, now this company is forecasting that there is a 65 percent chance that there will be a global recession by the end of next year…

This post was published at The Economic Collapse Blog on November 10th, 2014.

Gold & Silver Trading Alert: Gold and Miners Soar on Huge Volume

Briefly: In our opinion no speculative positions are currently justified from the risk/reward perspective. In other words, closing short positions and taking profits off the table seems justified.
Much happened on Friday in gold and mining stocks and the key question is this: does this strength prove that the bottom is in? Our take is that it suggests that ‘a bottom’ might be in, but ‘the bottom’ is likely still ahead of us.
Let’s take a look at the charts, starting with the USD Index (charts courtesy of
On Friday we wrote the following:
The USD Index is after a major breakout and there is no strong resistance level until about 89. This means that the USD Index is likely to rally for another 1 – 1.5 before the top is in. In other words, the USD Index has room for further gains and gold seems to have room for further declines.
The above hasn’t changed even though the USD Index declined a bit on Friday. It didn’t reach an important resistance level before Friday’s decline and the move above the previous 2014 high is confirmed. Consequently, it’s likely that the rally will continue until the USD Index reaches at least the 2010 high, and more likely the 2009 high.

This post was published at GoldSeek on 10 November 2014.

Deflation vs Inflation

Deflation vs. Inflation
Some people are expecting deflation…
… Others are expecting inflation.
So who’s right?
Not Steve Liesman All of them.
Deflation
Investopedia defines deflation as ‘a general decline in prices, often caused by a reduction in the supply of money or credit.’
While that’s not occurring everywhere, it is taking place in parts of the world.
Credit growth in Europe
The global economy is dependent on credit; if it doesn’t grow then neither will economic output.
Chart 1 shows that, in Europe, loans to private sector have been trending down since mid-late 2011 and are now negative…

This post was published at Zero Hedge on 11/10/2014.

The End of the US Dollar Imperium (Part 2) | Patrick Barron

The following video was published by FinanceAndLiberty.com on Nov 10, 2014
Jeff Deist and Patrick Barron continue their discussion on monetary imperialism. They delve deeper into US dollar supremacy, and how it might end with a whimper instead of a bang; how the Bundesbank is a potential savior for the world monetary order, while the IMF is a paper tiger; how elites will have an increasingly hard time denying gold a role in the global monetary system, and how America’s fiat dollar corrupts cultures as well as economies.

Greece Has Solved Its Unemployment Problem: Slavery

On the heels of today’s dreadful, and very un-hockey-stick-like recovery, data on the Greek economy, it appears the government has found a solution to the various problems of joblessness and poor education. As KeepTalkingGreece reports, the Greek Education Ministry seek fill 1,100 job vacancies with teachers who will gladly and proudly work on “voluntary basis.” As far as we remember, working for nothing is, err, slavery; but that’s not it at all… as Education Minister Andreas Loverdos, the slave teachers will be rewarded with “bonus points” that will help them improve their hiring options in the future. Ironic that this should be happening as fast-food workers in America demand a higher minimum wage (maybe unemployed Greek teachers would be willing to flip burgers for money rather than teach young greeks for nothing).
Via KeepTalkingGreece,
Greek Education Ministry seek fill 1,100 job vacancies with teachers who would be gladly and proudly work on ‘voluntary basis’, that is without payment! According to daily TA NEA, Education Minister Andreas Loverdos considers to seek teachers who would work on voluntary basis in order to fill up vacancies in schools with teachers’ shortage.
The volunteers will be rewarded with ‘bonus points’ that will help them improve their hiring options, should these be possible on day in the near or -most likely – far future.
As the loan agreement with the Troika ‘freezes’ replacement of retired personnel, the shortage of teachers in schools is impossible to be overcome.

This post was published at Zero Hedge on 11/10/2014.

A “Dangerous Spiral” Has Taken Hold In Emerging Markets

We find the following cause-and-effect mechanisms in a “dangerous spiral”:
Capital outflows, leading to weak investment; Accordingly, exchange-rate depreciation; Hence inflation, loss of purchasing power and weakening of consumption; Hence problems for the central bank, which is faced with both sluggish growth and inflation; The sluggish growth amplifies the capital outflows. Several major emerging countries are caught in this dangerous spiral; we will look at Russia, Brazil, Turkey, Argentina, India and South Africa.
This “dangerous spiral” is very clear in Russia, Brazil, Argentina and South Africa. Some of its components are appearing in Turkey and India.
First stage: Capital outflows and weakening investment
If a country is faced with large capital outflows because this capital is not being invested in the country, investment is weakened.

This post was published at Zero Hedge on 11/10/2014.

The Council Of Foreign Relations Apologizes For The “Greenspan Glitch”

Last week, we brought to the public’s attention a controversial ‘missing’ section from the official transcript of Alan Greenspan’s interview last with the Council of Foreign Relations where he dared utter his honest opinion that, “Gold is a currency. It is still, by all evidence, a premier currency. No fiat currency, including the dollar, can match it.” Well, it turns out the reason for the practically heterical section’s omission was “a glitch in the live stream” and CFR has apologized and posted the full transcript. Interesting coincidence that this gold-loving, Bernanke-denying section was the only one to be hit by the ‘glitch’; we are confident it’s mere coincidence…
CFR has apologized…

This post was published at Zero Hedge on 11/10/2014.

This Chart Shows How The Biggest Problem in the Jobs ‘Recovery’ Keeps Getting Worse (by the Atlanta Fed!)

The undisputed growth industry that has done so well since the very beginning of the Financial Crisis, and in fact since 2001, after having plateaued or even declined for years before then, is involuntary part-time employment. Now it turns out, according to a study by the Atlanta Fed, that these folks are also getting hosed when it comes to wage ‘growth.’ With big implications for the economy on one side, and corporate profits on the other.
For much of the 90s, part-timers hovered just above 23 million on a flat trend line. But with the recession of 2001, part-time employment began to thrive, and continued to thrive afterwards, reaching 25.4 million by June 2007. In November 2007, just before the Great Recession officially started, there were 24.8 million part-timers. In 2008, amid soaring layoffs as the financial house of cards was coming down, part-time employment jumped!
By July 2009, there were 27.7 million part-timers, even as full-time employment was being decimated. That’s an increase of about 3 million since the beginning of the Great Recession – almost 12%!
The month-to-month numbers are volatile, but the trend has remained clear since then: part time employment continues to grow. It exceeded 28 million in May 2012, then again in June and July 2013, and once again in June and July 2014.

This post was published at Wolf Street on November 10, 2014.

Trannies Trounce Small Caps As Bullion, Bonds, & Black Gold Get Battered

Two words tell you all you need to know about today’s equity trading… no volume (lowest since Aug27th). The main theme of today – away from stock markets – was to unwind some or all of Friday’s moves on the dismal Italy/Greece data: Treasury yields jerked almost 10bps off their lows with 30Y almost retracing the entire Friday rally; The USD rallied, recovering some of its losses from Friday (led by CAD and JPY weakness – which were both stronger Friday); gold and silver were slammed today – almost retracing Friday’s gains; and oil prices gave up all their intraday gains to close notably lower. USDJPY and bonds decoupled from stocks which appeared led by a VIX-smashing day, sending the fear index below 12.5. The Dow and S&P closed at all-time highs.

This post was published at Zero Hedge on 11/10/2014.

BofA: “Change Your Thinking On Gold” Friday Marked The End Of A 4 Year Decline

For the week ahead, BofAML’s MacNeil Curry is focused on the plight of the USDollar, US Treasuries, and commodities; especially gold and oil. All of these markets, he warns, are showing signs of changes in trend. Most notably, Curry explains, we are switching gears on gold from bearish to bullish, “Friday’s gains are just the beginning.”
Via BofAML’s MacNeil Curry,
Gold: Friday’s gains are just the beginning…

This post was published at Zero Hedge on 11/10/2014.

Gold US$5,000: Is it Possible? And when?

If we look at a graph of the ’70s gold bull market (graph #1) and superimpose the typical bubble shape, we can clearly see that it closely fits the bubble model but stopping short of a Total Despair Phase. Those like me who lived through the euphoria of the ’70s and the capitulation of the ’90s, I am sure, will agree with the description of the gold market as a bubble. Looking at the graph below it doesn’t look like gold was in a Despair Phase but I remember well in the ’90s statements by many in the financial industry that gold was a relic of the past, a useless metal and that its fundamental value was zero, predicting lower prices of about US$50 and some even zero. These statements are very characteristic of a major bottom.
Graph #1: Gold Bubble 1980

This post was published at Gold Broker on Nov 10, 2014.

Can Anarcho-Capitalism Work?

This talk was delivered at the Costa Mesa Mises Circle on Society Without the State, November 8, 2014.
The term ‘anarcho-capitalism’ has, we might say, rather an arresting quality. But while the term itself may jolt the newcomer, the ideas it embodies are compelling and attractive, and represent the culmination of a long development of thought.
If I had to boil it down to a handful of insights, they would be these: (1) each human being, to use John Locke’s formulation, ‘has a property in his own person’; (2) there ought to be a single moral code binding all people, whether they are employed by the State or not; and (3) society can run itself without central direction.
From the original property one enjoys in his own person we can derive individual rights, including property rights. When taken to its proper Rothbardian conclusion, this insight actually invalidates the State, since the State functions and survives on the basis of systematic violation of individual rights. Were it not to do so, it would cease to be the State.
In violating individual rights, the State tries to claim exemption from the moral laws we take for granted in all other areas of life. What would be called theft if carried out by a private individual is taxation for the State. What would be called kidnapping is the military draft for the State. What would be called mass murder for anyone else is war for the State. In each case, the State gets away with moral enormities because the public has been conditioned to believe that the State is a law unto itself, and can’t be held to the same moral standards we apply to ourselves.
But it’s the third of these ideas I’d like to develop at greater length. In those passages of their moral treatises dealing with economics, the Late Scholastics, particularly in the sixteenth and seventeenth centuries, had been groping toward the idea of laws that govern the social order. They discovered necessary cause-and-effect relationships. There was a clear connection, for example, between the flow of precious metals entering Spain from the New World on the one hand, and the phenomenon of price inflation on the other. They began to understand that these social regularities were brute facts that could not be defied by the political authority.

This post was published at Lew Rockwell on November 10, 2014.

October Was A “Trailer” For Real Market Turmoil, Don’t Hold Your Breath For Policymakers

Excerpted from Paul Singer’s letter to investors,
Policymakers in the developed world do not seem to believe (as we do) that their complete reliance on zero-percent interest rate policy (ZIRP) and quantitative easing (QE) for propping up the global economy may be the unintended but proximate cause of the poor performance of the developed economies over the last six years, rather than the cure-all nostrum that they think it is. Indeed, Europe is in the process of actually doubling down on QE, with large asset purchases by the European Central Bank expected in the near future. ZIRP and QE were concocted as emergency strategies, but their persistence post-crisis has caused distortions that have seriously interfered with the proper functioning of the developed economies. Ironically, these policies also exacerbate the income and wealth inequality that has become a source of some resentment among the public at large, as well as considerable attraction as talking points for politicians.

This post was published at Zero Hedge on 11/10/2014.