Is The “Deplorable Economy” Flashing Warning Signs About Overall Economic Growth Prospects?

For months we’ve been warning that soaring auto sales represent nothing more than the latest bubble created courtesy of low interest rates, deteriorating lending standards in the form of stretched maturities and weaker credit profiles, and an insatiable demand for auto securitizations from yield-thirsty pension funds which wall street is happily trying to meet (see here, here and here).
Of course, with subprime auto ABS issuance soaring past 2006 levels last year…

This post was published at Zero Hedge on Dec 27, 2016.

Deflating Manhattan Housing Bubble Hits Amy Schumer

‘You can’t lose money in real estate’ – until you do.
The demise of the Manhattan house price bubble has a new and beloved for-instance.
Standup comedian and actress Amy Schumer is a total hoot on stage. And she’s a raging success. So it would have been nice if she could have made some money on her Manhattan co-op that was billed as a ‘penthouse.’ But it looks like she ended up in the hole. Manhattanites, even funny ones, are now once again finding out, along with home sellers in certain other trophy cities, that ‘you can’t lose money in real estate’ – until you do.
Her 850-square-foot 1-bedroom apartment occupying the entire top floor of a historic 20-foot wide townhouse – so this is not exactly a palace – at 129 West 80th Street near the Museum of Natural History went into contract on December 23, as reported today by Dow Jones unit Mansion Global:

This post was published at Wolf Street by Wolf Richter ‘ Dec 27, 2016.

Nation’s Second Largest Union “Prepares To Fight-Back Against” Trump’s “Extremist-Run Government”

Republican control of all three branches of government in Washington DC has the nation’s second largest labor union worried about what a Trump administration might mean for their already declining membership and corresponding union dues. In response, the Service Employees International Union (SEIU) which represents nearly 2 million government, health care, and building-services workers and wields an annual budget of $300 million, has taken steps to slash its budget by 30% in an effort to hoard cash “to fight-back against” Trump’s “extremist-run government”. Per an internal memo from SEIU President Mary Kay Henry reviewed by Bloomberg:
‘Because the far right will control all three branches of the federal government, we will face serious threats to the ability of working people to join together in unions,’ SEIU President Mary Kay Henry wrote in an internal memo dated December 14. ‘These threats require us to make tough decisions that allow us to resist these attacks and to fight forward despite dramatically reduced resources.’ After citing the need to ‘dramatically re-think’ how to implement the union’s strategy, Henry’s all-staff letter announces SEIU ‘must plan for a 30% reduction’ in the international union’s budget by January 1, 2018, including a 10 percent cut effective at the start of 2017.
Asked about what the memo could mean for its current campaigns, SEIU didn’t offer specifics. ‘As we prepare to fight-back against the forthcoming attacks on working people and our communities under an extremist-run government, we know we must realign our resources and streamline our investments to buttress and broaden our movement to restore economic and democratic opportunity for all families,’ said spokeswoman Sahar Wali. ‘As part of this process, we are currently looking at possible ways to improve our budgets.’
Of course, the SEIU is likely most worried about so-called “Right to Work” laws which allow workers the choice to decline paying fees to the unions that represent them. But if unions are providing such a great service for their membership then shouldn’t workers to happy to pay their dues?

This post was published at Zero Hedge on Dec 27, 2016.

Government Destroys Couple’s Rights Over Rainwater: “If You’re Honest, They Take Everything Away”

With each passing year, SHTFPlan.com’s Mac Slavo notes there are more and more challenges to personal property and individual sovereignty.
Despite the resilience it lends to our national security, the government has proven again and again that it wishes to clamp down on the ability to prep, survive and self-sustain off grid, and without the need for the system’s supply chain.
You can hardly build your own place, grow your own food, collect your own water or take care of yourself without the intervention of those in authority. There is need to push back against this continued intrusion of our lives.
Couple Forced to Destroy 40-Year-Old Pond On Their Own Property Because Govt Owns The Rainwater
Authored by Claire Bernish via The Free Thought Project,
An Oregon couple has been told they must destroy a 2-acre pond on their land – the property’s most attractive feature – because the government said so.
Although Jon and Sabrina Carey purchased the 10-acre property near Butte Falls two and a half years ago, the pond has been in place for 40 years – but that fact doesn’t matter to the Jackson County Watermaster’s Office.
‘I basically bought a lemon,’ said Jon, who became teary-eyed at the edge of the partially ice-covered body of water being targeted by government, in an interview with the Mail Tribune. ‘That’s how they explained it to me.’

This post was published at Zero Hedge on Dec 27, 2016.

Jim Rickards: Trump’s Stimulus Plan Not Happening

Economist Jim Rickards appeared on CNBC’s ‘Squawk Box’ outlining his 2017 predictions for rate hikes, Trump stimulus, and the coming US recession. Rickards believes the markets are unwittingly pricing in a stimulus plan that will never materialize.
‘Trump wants to cut taxes. Steve Bannon is talking to his advisors about a trillion dollars of infrastructure spending, cutting regulations. All of these things are viewed to be highly stimulative. That’s why the market is going up. Pharmaceuticals are going up on the repeal of Obamacare, banks going up on the repeal of Dodd-Frank.’
The markets and the Fed have the perception that tax cuts and spending will continue despite the realities of a fiscally conservative congress, a $20 trillion of debt and a 104% debt-to-GDP ratio.

This post was published at Schiffgold on DECEMBER 27, 2016.

First Cash Ban, Now Europe Proposes Confiscating Gold To Crackdown On Terrorists – Episode 1163a

The following video was published by X22Report on Dec 27, 2016
The UMich and the Conference Board consumer confidence models surged reporting that the illusion is complete and people believe the economy is improving. Case Shiller reports that housing prices have hit all time highs. ECB lowers Deutsche Banks capital requirements to that Deutsche Bank executives can receive bonuses. Monti de Paschi is experiencing a bank run of sorts as the bank is experiencing a rapid liquidity deterioration . The US is selling off some of it’s oil reserves under the pretense the funds will be used to refurbish the system. Europe is taking the next step, they are making the case why they need to confiscation gold, bitcoin and prepaid cards to crack down on terrorism funding

Star Wars’ Icon Carrie Fisher Has Died

Just two days after the death of pop icon George Michael, Carrie Fisher, the actress best known as Star Wars’ Princess Leia Organa, has died after suffering a heart attack. She was 60.
Family spokesman Simon Halls released a statement to PEOPLE on behalf of Fisher’s daughter, Billie Lourd:
‘It is with a very deep sadness that Billie Lourd confirms that her beloved mother Carrie Fisher passed away at 8:55 this morning,’ reads the statement.
‘She was loved by the world and she will be missed profoundly,’ says Lourd. ‘Our entire family thanks you for your thoughts and prayers.’

This post was published at Zero Hedge on Dec 27, 2016.

‘Financial Lockdown… ATMs Went Dry’: 3 Police States Banning Cash to Control the People

Is it any coincidence that the financial crises, and the subsequent restrictions, follow the general chaos and upheaval that surround hotspots and conflict zones?
The European Union has once again been confronted with a major terror attack, and is coming down harsh on cash, gold and other valuables as a response. Due to its supposed connection to financing terrorism, cash and gold are being closely monitored and seized as it flows into the EU.
Meanwhile, economic crisis driving extremely tight cash control measures in Venezuela, India and other parts of the developing world. In the name of combating illicit financial activities, these countries have banned nearly all of the currency, while placing a very short leash around their already impoverished populations.
The United States, too, is under a great deal of economic pressure. Enormous mounts of debt, rising interest rates and a number of massive bursting bubbles, could explode into a major crisis. While there are already fairly tight restrictions on transferring, withdrawing or crossing borders with large amounts of cash, even great restrictions may be coming.
Earlier in 2016, former Treasury Secretary Larry Summers, an architect of the last banking crisis, penned an op-ed called ‘ It’s time to kill the $100 bill ‘
Harvard’s Mossavar Rahmani Center for Business and Government, which I am privileged to direct, has just issued an important paper by senior fellow Peter Sands and a group of student collaborators. The paper makes a compelling case for stopping the issuance of high denomination notes like the 500 euro note and $100 bill or even withdrawing them from circulation.

This post was published at shtfplan on December 27th, 2016.

Guess Which Billionaire (From Omaha) Made More Money Than Anyone Else In The World Thanks To Trump

Staunch Hillary Clinton supporter (and vehement anti-Trump-er) Warren Buffett had a better year than any other billionaire on earth… thanks to Donald Trump.
Buffett‘s net worth is up around $12 billion this year – with the majority of his gains coming in the weeks since Trump was elected – sending him up the ranks to become the 2nd richest man in the world (behind Bill Gates).
Fracking titan Harold Hamm is $8.4 billion richer now compared to December 31, 2015, the third biggest dollar gain of anyone in America. Shares of his oil giant Continental Resources soared 136% thanks to the rising price of crude oil. The Texas oilman has ridden oil’s boom and bust cycles for years. He gained more than $13 billion from 2010 to 2014, lost more than $13 billion by March 2016, then regained most of it in the last nine months. Today he is worth $15.3 billion, Bloomberg calculates.

This post was published at Zero Hedge on Dec 27, 2016.

DEC 27/GOLD AND SILVER RISE/HUGE BOMBSHELL AGAIN AT TOSHIBA/CHINA FINALLY ADMITS THAT IT WILL NOT HIT ITS TARGETS: DOWN GOES COMMODITY PRICES/RUN ON THE BANK AT MONTE DEI PASCHI AS WEIDMANN STATE…

Gold at (1:30 am est) $1137.30 UP $5.40
silver at $15.93: UP 23 cents
Access market prices:
Gold: $1139.00
Silver: $15.96
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON
The Shanghai fix is at 10:15 pm est last night and 2:15 am est early this morning
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.
And now the fix recordings:
TUESDAY gold fix Shanghai
Shanghai morning fix Dec 27 (10:15 pm est last night): $ 1161.18
NY ACCESS PRICE: $1137.50 (AT THE EXACT SAME TIME)/premium $23.68
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ 1161.28
NY ACCESS PRICE: $1139.50 (AT THE EXACT SAME TIME/2:15 am)
HUGE SPREAD 2ND FIX TODAY!!: $21.78
China rejects NY pricing of gold as a fraud/arbitrage will now commence fully
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
London Fix: Dec 27: 5:30 am est: $xxx.00 (NY: same time: $xxx 5:30AM)
London Second fix Dec 27: 10 am est: $XXXX (NY same time: $xxx 10 AM)
It seems that Shanghai pricing is higher than the other two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex.

This post was published at Harvey Organ Blog on December 27, 2016.

Gold: A Significant Rally Begins?

Gold may be in the first stage of a significant rally. Please click here now. Double-click to enlarge. Gold has burst out of the short term down channel, and the recent action of the ‘smart money’ commercial traders is very positive. Please click here now. This COT report for gold shows the commercial traders not only covering short positions in the latest reporting period, but also adding a nice number of longs! This is very encouraging news. Regardless, amateur gold enthusiasts need to buy dips and sell rallies, to mimic the smart money professional traders. On that note, please click here now. Double-click to enlarge. Gold has already rallied about $25 from the $1125 area lows, and the commercial traders are almost certainly booking partial profits now. As the saying goes, the early bird gets the golden worm! I have been getting emails from some gold community investors who are worried that the Indian government is conducting a ‘war on gold’. To a degree, that’s true, but all governments tend to prefer debt and fiat to gold.

This post was published at GoldSeek on 27 December 2016.

Europe Proposes Confiscating Gold In Crackdown On “Terrorist Financing”

Hot on the heels of China gold import restrictions, and India’s demonetization and gold confiscations, The European Commission proposed tightening controls on cash and precious metals transfers from outside the EU under the guise of shutting down one route for funding of militant attacks on the continent, following the Berlin Christmas attack.
China has already begun de facto gold import restrictions, and as Jayant Bhandari detailed previously, India is experiencing a continuation of new social engineering notifications, each sabotaging wealth-creation, confiscating people’s wealth, and tyrannizing those who refuse to be a part of the herd, in the process destroying the very backbone of the economy and civilization. There are clear signs that in a very convoluted way, possession of gold for investment purposes will be made illegal. Expect capital controls to follow.
And now, as Reuters reports, it appears last Monday’s attack on a Christmas market in Berlin, where 12 people were killed as a truck ploughed into a crowd, has given The European Commission just the excuse to tighten capital controls – specifically cash and precious metals – into and out of Europe.

This post was published at Zero Hedge on Dec 27, 2016.

Bank Bailout Balloons, Tab for Italian Banking Crisis Soars

Monte dei Paschi di Siena sinks deeper into the mire.
Over the Christmas holidays, when no one was supposed to pay attention, and when the markets were closed, the bailout costs of Monte dei Paschi di Siena, the third largest bank in Italy, and the center of the Italian banking crisis, suddenly jumped by 75% to 8.8 billion ($9.2 billion)!
Just how immense the black hole inside of a bank really is remains unknown until the bank collapses entirely and the pieces are sorted out. No one wants to know, especially not bank regulators. But when banks are teetering, and a bank bailout, or rather a bondholder bailout is being discussed, the aspects of that hole begin to emerge, and the hole keeps getting bigger the longer someone looks at it.
Earlier this year, the ECB’s stress tests of 51 large European banks determined that Monte dei Paschi was the shakiest among them. The ECB gave the bank until the end of 2016 to raise enough capital or contemplate the prospect of being wound down.
Last week, after Monte dei Paschi failed to work out a private-sector rescue deal led by JP Morgan, a taxpayer bailout was moved to the front burner. The bank’s shares and bonds were suspended from trading until the details of the bailout would emerge. This came after two prior capital increases from the private sector in recent years had failed to fill the holes. Each time, gullible investors had gotten crushed.

This post was published at Wolf Street on Dec 27, 2016.

Just Charts at 2:30

This market action is a snooze. Not worth trading except for the very nimble.
Housing appears to be in a number of localized regional bubbles.
Stocks are already in bubble territory.
The economic recovery is thin and overstated to the point of fakery, with little real wage and full time job growth to sustain aggregate domestic demand. With monopolistic pricing in healthcare and other sectors continuing to soar, this is not a recipe for sustainable social interaction, much less a recovery.
Trump’s fiscal initiatives remain a viable wild card, but the information to date does not appear to be hopeful, since the destroyers of the middle class are in the ascendancy. Keeping an open mind on that, but the auspices are not good.
I received some video games for Christmas, and I am itching to give Skyrim Special Edition a spin. lol

This post was published at Jesses Crossroads Cafe on 27 DECEMBER 2016.

SWOT Analysis: This Could Result In a More Bullish Scenario for Gold

Strengths
The best performing precious metal for the week was gold, down just 0.08 percent. Gold is steady in year-end holiday trading, reports UBS, and is trying to form a base around these levels. Physical markets have perked up, helping the market find stability. UBS says there is lack of urgency to jump into the yellow metal right now, and there ‘is room to be patient and gradually build strategic positions.’ Similarly, Comerzbank AG believes gold is finding support from slightly declining bond yields and a marginally weaker U. S. dollar. India’s Commerce Ministry has recommended slashing the duty on gold imports from 10 percent to 6 percent, reports Bloomberg, as the higher duty encourages smuggling of the precious metal. In other gold-related news from Deutsche Bank, the group assesses the value of the gold ‘cost curve’ when it comes to providing a fair value reference for the metal. Skeptical at first, the bank now recognizes that since 2000, the 90th percentile producer has been a good indicator of the minimum weekly gold price in a given year. ‘Under these assumptions, the gold price in 2017 would average $1,200 an ounce, with the minimum weekly price falling to $1,060 an ounce. Weaknesses
The worst performing precious metal for the week was palladium, down 5.39 percent. Russia reported that palladium output rose 1.7 percent on the year. The market may also start to get nervous about the likelihood that China removes its tax incentive on sales of small-engine cars at the end of the year where palladium is used in the catalytic converter to clean pollutants from the exhaust. Chinese car sales having been booming in recent months at an unsustainable pace so we could see weaker sales in 2017 if there is a change in policy.

This post was published at GoldSeek on 27 December 2016.

ECB Lowers Deutsche Bank’s Capital Requirements, Allowing It To Pay Bonuses

While Deutsche Bank has had a generally terrible year, with its stock price plunging to all time lows on capitalization (and, at times, liquidity) concerns following the now concluded episode of its RMBS fine which the bank settled last week for roughly $7 billion of which just over $3 billion in actual cash payments, well below Wall Street’s worst case scenario, another far more important open item was whether DB executives and staffers would receive a bonus in a year in which markets seriously wondered if the biggest European bank would get a government bailout.
Here, the the rumormill was in overdrive: in October speculation was rampant was that DB would skip cash bonuses, making payments in shares of non-core units of the bank; other rumors tied bonus payments to the company’s share price, while in yet more rumors, some suggested that DB would cancel or even clawback bonuses for/from former executives. In any case, had DB not succeeded in settling its RMBS litigation, it was assured that the German lender would not pay any bonuses to anyone.

This post was published at Zero Hedge on Dec 27, 2016.

Chinese Interbank Funding Freezes Again As Overnight Repo Hits 33%

While we have previously shown the amazing gimmicks the Chinese central bank does with the short end of the offshore Yuan interbank offered rate, which as previously explained, and as shown in the animation below, has become the PBOC’s favorite means of punishing currency speculators by making Yuan borrowing costs against shorts crushingly high, forcing short unwinds…
… when it comes to more traditional unsecured short-term funding markets, like the simple overnight repo, these reflect overall levels of liquidity in the interbank market, or as the case may be, complete absence thereof.

This post was published at Zero Hedge on Dec 27, 2016.

2017 Annual Forecast

The convulsions to come in 2017 are the political manifestations of much deeper forces in play. In much of the developed world, the trend of aging demographics and declining productivity is layered with technological innovation and the labor displacement that comes with it. China’s economic slowdown and its ongoing evolution compound this dynamic. At the same time, the world is trying to cope with reduced Chinese demand after decades of record growth, China is also slowly but surely moving its own economy up the value chain to produce and assemble many of the inputs it once imported, with the intent of increasingly selling to itself. All these forces combined will have a dramatic and enduring impact on the global economy and ultimately on the shape of the international system for decades to come.
These long-arching trends tend to quietly build over decades and then noisily surface as the politics catch up. The longer economic pain persists the stronger the political response. That loud banging at the door is the force of nationalism greeting the world’s powers, particularly Europe and the United States, still the only superpower.
Only, the global superpower is not feeling all that super. In fact, it’s tired. It was roused in 2001 by a devastating attack on its soil, it overextended itself in wars in the Islamic world, and it now wants to get back to repairing things at home. Indeed, the main theme of US President-elect Donald Trump’s campaign was retrenchment, the idea that the United States will pull back from overseas obligations, get others to carry more of the weight of their own defense, and let the United States focus on boosting economic competitiveness.

This post was published at FinancialSense on 12/27/2016.