Why The NWO Hates Syria

China's central bank calms markets, but tighter policy looms

By Gabriel Wildau and Lu Jianxin

SHANGHAI (Reuters) - China's financial markets were calmed on Wednesday after days of turmoil by the central bank's pledge to prevent any lasting credit crunch, but stocks kept slipping as investors braced for tougher conditions in the world's second-largest economy.

The People's Bank of China (PBOC) said late on Tuesday it had helped some banks and was ready to act again as the lender of last resort for those caught in a short-term squeeze. However, it was also sticking to its stance of tightening market conditions as it seeks to rein in sharp growth in informal lending.

The central bank wants to curtail funds flowing into China's vast "shadow" financial system that fuels property and stock speculation and push money into more productive areas of the economy to secure more sustained growth.

But its decision to allow short-term borrowing costs to shoot up to extraordinary levels last week fanned fears that a temporary squeeze could morph into a lasting credit crunch and had roiled global markets.

"Market sentiment has apparently improved somewhat, although the PBOC is still expected to stick to relatively tight liquidity policy," said a dealer at a major state-owned bank in Shanghai.

The PBOC reiterated its warning to banks that they needed to manage liquidity more carefully and protect against risks of reliance on short-term borrowing, adding to expectations of tougher business conditions and possibly slower economic growth.
So while most Asian share markets rebounded from a four-day losing streak, taking comfort from encouraging U.S. economic data and the PBOC assurances, shares in Shanghai <.csi300>(.SSEC) were lower, again led by financial stocks (.SSEFN) which at one point were down well over 2 percent.
Money market dealers were relieved that a full-blown market freeze seemed to have been averted, but said fund flows suggested cash would remain tight until mid-July.
The benchmark seven-day repo rate opened down about a quarter of a point at around 7.20 percent on a weighted-average basis on Wednesday, before inching up to 7.26 percent, still well above the long-run average of 3 to 4 percent.
END OF EASY CREDIT?

The central bank said it would actively inject cash "based on the market's actual situation" and would "adjust banking system liquidity in a timely manner".

The central bank's words and actions convinced a growing number of analysts that while the worst-case scenario of a credit freeze and banking crisis seemed distant, the era of rapid growth fuelled by cheap credit was also over.
"The policy stance will likely remain tight. The statement indicated that the PBOC will stick to 'prudent monetary policy', which suggests that credit growth will continue to decline in the near term," Nomura analysts said in a note.

"The PBOC also indicated that it would inject liquidity into financial institutions facing liquidity problems if those institutions 'help the real economy'. This supports our view that the PBOC will not tolerate bank failures," they said.

The revelation that the PBOC had supported unnamed individual institutions came after outages at automatic teller machines and Point of Sales terminals at two of China's largest banks caused concern among the public.

(Writing by Tomasz Janowski; Editing by John Mair)

Most Asia shares rebound on PBOC but Shanghai extends slide

By Chikako Mogi

TOKYO (Reuters) - Most Asian shares turned around a four-day losing streak and rose on Wednesday as investors took comfort from U.S. data underscoring an American recovery and assurances from China's central bank that it will offer funds to banks if needed.

But fears of a credit crunch and slower loan growth continued to fuel selling of Chinese banking shares in Shanghai, pulling Japan's Nikkei (.N225) down nearly 1 percent at one point after a solid start. (.T)
Even as they eased for a fourth day, China's short-term borrowing rates remained at elevated levels and some traders expected liquidity to remain tight until mid-July. (CN/)
"Worries over China's banking system and economy still weigh on the markets," said Hiroaki Hiwada, a senior strategist at Toyo Securities.
Hong Kong shares (.HSI) were up 0.9 percent but Shanghai shares <.csi300>(.SSEC) once again turned lower and extended losses to more than 1 percent, after tumbling nearly 7 percent at one point on Tuesday to the lowest since January 2009.
MSCI's broadest index of Asia-Pacific shares outside Japan <.miapj0000pus> climbed 1.1 percent after plumbing an 11-month low on Tuesday, with Australia, Taiwan and Southeast Asian bourses firming.
Still, the gauge's relative strength index (RSI) was a weak 23.7, showing investor confidence in pan-Asian bourses remains badly shaken after a month-long emerging market slide.
Traders were largely skeptical about prospects for a near-term market recovery, attributing strength in parts of Asia largely to short-covering after heavy selling in recent days. Indeed, foreign investors sold South Korean shares for the 14th straight session. Seoul shares (.KS11) turned 0.3 percent lower.
"The PBOC comments did not help much to improve people's confidence as the consequences are yet to be seen amid slow (China) economic growth," said Alex Wong, a director at Hong Kong-based Ample Finance Group.
"A firmer tone in Hong Kong-listed Chinese banks shares is purely short covering while in China, the weak tone will not change all of a sudden. Longer-term sentiment in both China and Hong Kong is still very weak."
China's short-term cash rates soared to record peaks last week after the PBOC allowed money market funding to tighten to curb credit for the lightly regulated and speculative "shadow banking" sector, stoking worries of a cash squeeze which could derail economic growth.

The People's Bank of China (PBOC) said late on Tuesday it had provided cash to some institutions facing temporary shortages and would continue to do so if needed, seeking to tame investor jitters amid spiking money market rates that raised fears of a banking crisis and sent shares plummeting.

DOLLAR FIRMS, GOLD PLUNGES
Global equity markets rose on Tuesday after U.S. economic reports ranging from manufacturing and housing to consumer confidence buoyed optimism - after days of nerve-wracking uncertainty over the intentions of the world's biggest central banks.
The improving U.S. data pushed up the dollar, which in turn slammed precious metals hardest among the generally bearish dollar-based commodities.

Tuesday's data showed strong gains in U.S. business spending plans last month, the largest annual rise in house prices in seven years in April, and consumer confidence at its highest level in more than five years this month. The housing sector was also firming, with new single-family home sales near a five-year high in May.

"Overall these data align with the Federal Reserve's assessment that the U.S. economy is improving modestly, and specifically over the past two weeks, U.S. economic data has by and large beaten consensus forecasts," said Christopher Vecchio, analyst at DailyFX.

The Fed ignited a global market sell-off last week by announcing a plan to end stimulus, starting with a toning down of its monthly bond-buying later this year if the economy continued to improve as forecast.
The dollar pared early gains to hold steady against the yen around 97.77, and was up 0.08 percent against a basket of major currencies (.DXY), crawling back towards a three-week high of 82.841 seen on Monday.
U.S. crude futures slipped 0.8 percent at $94.58 a barrel and Brent fell 0.5 percent to $100.78. (O/R)
Spot gold dropped 2.3 percent to a near three-year low of $1,247.24 an ounce, dragging spot silver down more than 4 percent to $18.77, its lowest since August 2010. (GOL/)
"A drop in emerging currencies has made dollar-based commodities prices more expensive and spurred outflows from commodities markets which have been suffering from fund outflows for some time now," said Tetsu Emori, a commodity fund manager with Astmax Investments in Tokyo.

(Additional reporting by Ian Chua in Sydney, Donny Kwok in Hong Kong and Tomo Uetake in Tokyo; Editing by Eric Meijer)

U.S. tops confidence survey on foreign investment, displaces China

By Daniel Bases and Manuela Badawy

NEW YORK (Reuters) - After a 12-year hiatus, the United States reclaimed first place among top executives in a survey on foreign direct investment sentiment, displacing China as it makes progress toward sustainable and steady economic growth, a study showed on Wednesday.

The United States jumped from fourth place in 2012, according to the 2013 Foreign Direct Investment Confidence Index, a survey of more than 300 executives from 28 countries by global consulting firm A.T. Kearney.

The survey, conducted between October and November of last year, highlighted executives' views that U.S. workers are becoming more competitive and, until recently, the weakness in the U.S. dollar helped improve the country's exports profile.

Combined with a recovering housing market and the surge in production of unconventional oil and gas, the United States took back the top spot for the first time since 2001 despite still serious fiscal policy uncertainty and sizeable debt issues.
More than half the respondents believe the global economy will recover from the financial crisis and recessions in 2014 (26 percent) and 2015 (28 percent). That is a shift in sentiment from 2010 when 42 percent believed the recovery would occur in just one year.

"Investors are demonstrating more mature judgment about what the risks are and what the expected returns will be and how long it will take the global economy to recover," Paul Laudicina, chairman emeritus of A.T. Kearney, told Reuters in a telephone interview.

The FDI Confidence Index ranks countries on how political, economic and regulatory changes will affect foreign direct investment.

The United States is the top recipient of FDI inflows for a sixth consecutive year, according to the survey.

Respondents were most optimistic about the United States' prospects, with 63 percent expecting some economic growth, compared with 62 percent who believe Europe may have no growth or return to recession over the next three years.

The survey found that roughly 90 percent of investors report the euro zone crisis has or will impact their FDI decisions.
Rounding out the top five in the confidence index are Brazil, Canada and India.
CHINA'S DROP

Factors that impacted the outlook for FDI into China include a doubling of labor costs since 2007, rising transportation costs and the appreciation of its currency, the renminbi, which made it less competitive against other low-cost alternatives such as Mexico.

The push by China, the world's second-largest economy, for the last 30 years to be a manufacturing powerhouse has given way to trying to create a more consumer-driven economy, "sparking internal debates about companies' future plans," the survey said.
Investors might be more upbeat today about the world's prospects than years past. Yet they are holding back investments waiting for a clearer solution to current risks such as the economic slowdown in China and the euro zone debt crisis.

The euro zone is mired in a recession that started out of the U.S. financial crisis of 2008-2009.

"I expect when investors look at an individual investment play and opportunity, most cite macroeconomic uncertainty. In fact 71 percent say reasons my company's FDI flows have not recovered to pre-recession levels is because of macroeconomic instability or uncertainty," Laudicina said.

While investors are holding back investments due to worries about the global macroeconomic situation, companies are amassing record cash holdings.
U.S. firms in the S&P 500 Index held $900 billion in cash at the end of June 2012, according to the report, up 40 percent from 2008. Japanese cash rose 75 percent since 2007.
"This surplus could fuel more rapid global growth when the macroeconomic clouds finally dissipate," the report said.

Even while the world economy looks to the United States for economic leadership given its massive monetary policy stimulus program, perceptions of risk between emerging and developed markets are equalizing, the survey said, in nearly all areas save for politics.

"In area after area, from macroeconomic volatility and consumer demand to regulatory barriers and taxation, investors say that developing markets have roughly the same level of risk as developed markets," the survey said.

(Reporting by Manuela Badawy and Daniel Bases; Editing by Leslie Adler)

Russia, Kazakhstan, Azerbaijan, Kyrgyz Republic, Turkey Buy Gold On Dip

by GoldCore


Today’s AM fix was USD 1,285.00, EUR 979.42 and GBP 831.88 per ounce.
Yesterday’s AM fix was USD 1,283.25, EUR 978.98 and GBP 836.21 per ounce.
Gold fell $11.70 or 0.90% yesterday and closed at $1,282.30/oz. Silver slid to a low of $19.453 and finished down 2.14%.
Gold is marginally higher today in most currencies. Market participants continue to assess whether the gold price is vulnerable to more falls or is close to bottoming.
Recent market turmoil and sharp declines in stock and bond markets may have exacerbated gold’s recent weakness as margin calls led to forced selling of a market that was already under pressure.
Central bank reserve diversification should support gold at these very depressed levels.

Cross Currency Table – (Bloomberg)
The smart money continues to realise the importance of an allocation to gold for diversification purposes and to see gold’s long term bull market as intact.
Gold’s bull market is intact and prices will reach a new high as declines in bonds and equities boost demand and investors seek insurance against economic and political risk, according to Schroder Investment Management Ltd.
“Gold’s bull market is intact and prices will reach a new high as declines in bonds and equities boost demand and investors seek insurance against economic and political risk” Schroder Investment Management Ltd. Told Bloomberg in an interview.
Macroeconomic, geopolitical and monetary uncertainty led to continuing central bank diversification into gold in May. Recent price falls are not deterring many creditor nation central banks from allocating some of their foreign exchange reserves into gold.
Russia, Kazakhstan, Azerbaijan, Kyrgyz Republic and Turkey all increased their gold reserves in May.

IMF Russia Gold in Mill Fin Troy Oz – (Bloomberg)
Russia and Kazakhstan expanded their gold reserves for an eighth straight month in May, buying the metal to diversify assets due to increasing political, economic and monetary uncertainty.
Russian holdings, the seventh-largest by country, climbed 6.2 metric tons to 996.2 tons, taking gains this year to 4% after expanding by 8.5% in 2012, International Monetary Fund data show.
In ounce terms, Russia raised gold holdings to 32.027 million ounces in May from 31.829 million ounces in April.


Gold Support & Resistance Chart – (GoldCore)
Kazakhstan’s gold reserves grew 4 tons to 129.5 tons, taking the increase to 12% this year after a 41% expansion in 2012. In ounce terms, Kazakhstan expanded holdings to 4.163 million ounces in May from 4.036 million ounces in April.
Turkey’s holdings rose 18.2 tons to 445.3 tons in May, increasing for an 11th month as it accepted gold in its reserve requirements from commercial banks. In ounce terms, Turkey increased gold holdings to 14.32 million ounces in May from 13.73 million in April.
Azerbaijan and Kyrgyz Republic were among nations that bought bullion in May, while Brunei and Nepal added gold in April.
Mexico cut its gold reserves marginally for a 13th month while Czech Republic also reduced holdings marginally.
Czech Republic cut holdings to 0.355 million ounces in May from 0.366 million ounces in April. Mexico cut holdings to 3.986 million ounces in May from 3.989 million in April.
The People’s Bank of China does not declare their gold reserves to the IMF and is likely to be quietly accumulating gold reserves which is another important strong plank of support for gold.
This central bank demand is set to continue as macroeconomic, geopolitical and monetary uncertainty is here to stay and indeed may escalate substantially in the coming months as we move into the next phase of the global debt crisis.

BUSTED: Bankers Caught On Tape, Joking About Bailout, And How They’d Never Pay It Back

Bowe:  ”So we went down … and we basically said. In Central, yeah. And I mean, to cut a long story short we sort of said. ‘Look, what we need is seven billion euros…and we’re going to give you and we’re going to give you, what we’re going to give you is our loan collateral so we’re not giving you ECB, we’re giving you the loan clause.
“We gave him a term sheet and we put a pro not facility together and we said that’s what we need. And that kind of sobered up everybody pretty quickly, you know.”
Fitzgerald: ”Yeah.”
Fitzgerald: ”And is that €7 billion a term?”
Bowe: ”This is €7 billion bridging.”
Fitzgerald: ”Yeah.”
Bowe: “So … so it is bridged until we can pay you back … which is never.” (Both laugh)
Read more: http://www.businessinsider.com/anglo-irish-bank-tapes-2013-6#ixzz2XE2kAalB
INTRO: BUSTED: Bankers Caught On Tape, Joking About Bailout, And How They’d Never Pay It Back

CITI: We’re ‘Shocked’ By The Surge In Negative Earnings Preannouncements…Marc Faber: Stocks Could Fall 20% To 30%… Easily

“Dr. Doom” Marc Faber: Stocks could fall 20% to 30%… easily
“We have big trouble coming…”
“If you believe that [Bernanke] means what he says,” explains Gloom, Boom, and Doom’s Marc Faber to a spell-bound Trish Regan on Bloomberg TV, “then you believe in Father Christmas.”
Simply put, Faber adds, “we are going to see QE99,” and while he notes that equities, bonds, and gold are “very oversold,” he would “rather buy bonds and gold than equities.”
From his views on Laszlo Birinyi to inflation, the ‘taper’, US housing, and China, Faber calmly warns that “the S&P could drop 20-30% from the recent highs – easily.”
“The only thing that I know is that I want to own some physical gold because I don’t want all of my assets in financial assets.”
Faber on whether problems will continue for the equity markets:
“Well, right now…

http://www.zerohedge.com/news/2013-06-21/marc-faber-believing-bernanke-believing-santa-claus
CITI: We’re ‘Shocked’ By The Surge In Negative Earnings Preannouncements

Earnings matter most for stocks.

http://www.businessinsider.com/negative-to-positive-earnings-preannouncements-2013-6

This country’s stock market boom could put the Internet bubble to shame
High-Frequency-Trading (HFT) Algorithmic Programs dominate the equity markets in the US with as much as 80% of the volume in some markets.
… It’s different in Japan. In what seems like a flashback to dot-com trading in the U.S. in 1999, Abenomics Spurs Day Traders as Japan Stock Volatility Hits Two-Year High:
Sitting before a cluster of computer screens in an apartment with the drapes shut, it took Naoki Murakami seconds to make $3,500 betting $1 million that Tokyo Electric Power Co. (9501) shares would fall a fraction of a percent.
Day trading helps explain why Japanese individuals now account for more than 40 percent of the nation’s equity volume, or about as much as the overseas institutions that once were the biggest traders. They’ve also helped make Japan the most volatile developed market.
Dramatic price movements aren’t the only thing that’s made Japan a day trader’s paradise. Deregulation of margin trading opened the flood gates, Murakami said. After rules were relaxed in January, investors can borrow three times as much as their brokerage account balances and turn loans over the instant they exit a trading position…


“Now you can borrow endlessly,” Murakami said.
Pointing at price charts on his screens, the trader explained how each day he borrows millions of shares of fast-moving stocks like GungHo Online Entertainment Inc. (3765) and Fast Retailing Co. (9983), the most-heavily weighted company on the Nikkei 225, and sells them short…
One of Murakami’s friends, who goes by the blog name Tesuta, said looser rules let him leverage $4.5 million in cash into as much as $67 million in daily stock bets. He held up a hand-written ledger and showed his account balance at SBI Holdings Inc. as proof. He asked that his name not be cited for privacy reasons.
The number of shares traded by individuals rose to a record in May, some 43 percent of Japan’s total equity volume…
http://globaleconomicanalysis.blogspot.com/2013/06/day-traders-take-control-of-japanese.html
Today’s entertainment: U.S. financial sector thinks it’s just about ready to ruin the world again
“It’s been about five or six years since we last crippled every major market…”
Claiming that enough time had surely passed since they last caused a global economic meltdown, top executives from the U.S. financial sector told reporters Monday that they are just about ready to completely destroy the world again.
Representatives from all major banking and investment institutions cited recent increases in consumer spending, rebounding home prices, and a stabilizing unemployment rate as confirmation that the time had once again come to inflict another round of catastrophic financial losses on individuals and businesses worldwide.
“It’s been about five or six years since we last crippled every major market on the planet, so it seems like the time is right for us to get back out there and start ruining the lives of billions of people again,” said Goldman Sachs CEO Lloyd Blankfein. “We gave it some time and let everyone get a little comfortable, and now we’re looking to get back on the old horse, shatter some consumer confidence, and flat-out kill any optimism for a stable global economy for years to come…
http://www.theonion.com/articles/financial-sector-thinks-its-about-ready-to-ruin-wo,32865/?
Mortgage Rates on the Rise; Repeat of Lead-Up to 2008? 
Interest rates are crucial. Once rates rise substantially then it will become impossible to service the Federal debt without massive money creation. Doom for the markets and doom for the U.S. Dollar will surely follow. This will make the 2008 credit collapse seem like a small hiccup, by comparison.
http://www.investmentcontrarians.com/stock-market/mortgage-rates-on-the-rise-repeat-of-lead-up-to-2008/2383/