Greece is selling off bits and pieces of its country to the creditors.
Greek deposits become eligible for bail-ins. Major retailer going out of
business because of decline in sales and revenue. Building permits
plunge in NYC as the property tax expires. Atlanta FED recalculates GDP
to 1.3 as the auto industry increases production and channel stuffs
dealerships. Bail-ins are coming to America and the FDIC will go after
depositors. Global growth has slowed according to Moody’s and the US is
not prepared for a major crisis, the US has no grain reserves since
2008.
Wolf Richter wolfstreet.com, www.amazon.com/author/wolfrichter “We do not comment on future product speculation,” a Buick
spokesman said, refusing to confirm the leaks, but didn’t deny
them either.
GM sold 919,582 Buicks in China in 2014, four times as many as it
sold in the US! GM manufactures in China nearly all vehicles it sells
there. About half of GM’s earnings are generated in China. After having
been bailed out of bankruptcy by US taxpayers to keep the manufacturing
base in the US, GM bet big on China.
In July, GM announced that it would invest an additional $5 billion
in China to develop a new family of Chevrolet vehicles with its Chinese
partner SAIC. All global automakers have invested billions in China,
year after year, to build new plants, add capacity, and increase
production. More new plants are coming. More capacity is being added. It
all worked out because automakers sold these vehicles in China as fast
as they could make them.
Until this year. But now supply and capacity are still rising. Demand
has started to fall. Inventories are piling up. A vicious price war has
broken out. And the bane of the auto industry, overcapacity, is
suddenly looming ominously above them all.
Overcapacity tore up the industry in the US. It tore up the industry
in the EU. It’s a deadly disease for automakers. It led to bankruptcies
and bailouts. And now it’s spreading in China.
But there is a solution, apparently: exporting China-made vehicles to the US.
A few small-scale efforts have gone nowhere. America is a tough
market. The best companies fight it out on a daily basis and are being
taught lessons the hard way by finicky consumers.
Volvo, owned by Zhejiang Geely Holding, is starting to export its
China-made S60 Inscription to the US this summer. It’s the
long-wheelbase version of the Swedish-made S60 sedan. This will be the
first mass-produced car from China on US streets. Not exactly a tsunami.
But now GM is reportedly jumping into the game in a big way.
On Monday, the first leak appeared, and at a very inconvenient time for GM, currently in contract negotiations with the UAW. Automotive News reported that GM is planning to sell its Chinese-built compact crossover, the Buick Envision, in the US.
“It would fit perfectly in the Buick lineup at a time when crossover
sales are growing fast,” Jack Nerad, executive market analyst at Kelley
Blue Book, told Automotive News. “I’m sure a lot of Buick dealers wish they had it today.”
Crossovers are hot in China, unlike cars, whose sales volumes are
plunging. The Envision, built by GM’s joint venture Shanghai GM, arrived
in Chinese showrooms last fall. And already, over 57,000 were sold
during the first half this year. According to Buick spokesman Nick
Richards, it has been “extremely well-received.”
But China would remain by far the largest market for it. Automotive News:
Both IHS and LMC Automotive forecast a U.S. launch of the
Envision sometime in the second half of 2016, with annual volume
forecasts from the mid-20,000s to the high 30,000s. Their forecasts for
annual Envision sales in China range from 140,000 to 170,000 through
2018.
And US consumers would presumably flock to buy them:
A decade ago, the idea of China-made vehicles in U.S.
showrooms might have turned off American buyers. But that’s far less
likely today, IHS analyst Stephanie Brinley says. In recent years, GM
and other global automakers have built modern assembly plants in China.
And Americans are accustomed to their iPhones and other high-end
consumer goods being made there.
“For the U.S. consumer experience, there is likely to be little
difference between a Buick built at GM’s Orion Assembly plant [near
Detroit] or in Shanghai,” Brinley says.
That was on Monday. On Tuesday, Reuters
added fuel to the fire when it reported, based on two “sources
familiar” with GM’s plans, that “most Buick vehicles sold in the United
States after 2016 could be imported from China and Europe….”
According to the sources, “who did not want to be identified because their companies work with GM”:
Production of the compact Verano sedan will likely be shifted from Michigan to China in late 2016.
Production of the mid-size Regal sedan will likely be shifted from Canada to either China or Europe in 2017.
Buick will import the compact Cascada convertible from Europe early next year.
And production of the subcompact Encore crossover will be shifted from Korea to China.
In the future Buick lineup, only two models would be made in North
America: the replacements for the mid-size LaCrosse sedan and the large
Enclave crossover.
The automotive component industry has already centered itself in
China after the Financial Crisis in a whirlwind of bankruptcies and
reorganizations that led to hundreds of thousands of job losses in the
US. Today, Chinese-made components are used by all automakers that sell
vehicles in the US.
And Chinese-made Buicks, Chevrolets, Fords, Toyotas, and BMWs are
simply the next step. With the rosy prospects of overcapacity tearing up
the industry in China, exports to the US are a natural solution.
When GM jumps into it in a big way, other automakers will follow.
This would be the beginning of the long-awaited and much rumored tsunami
of Chinese-made cars on US streets. American consumers will get used to
them. At first, they were leery of Mexican-made cars; today, they
aren’t even asking anymore.
But hope for the vaunted “Manufacturing Renaissance” in the US takes
another hit, this time from China’s blossoming overcapacity fiasco.
China’s auto market had been the single most important element in the
convoluted recovery of GM and other global automakers. But the market
has been getting battered this year. And since the yuan devaluation, the
elements are coagulating into a toxic mix for GM. Read… China Mess, Yuan Devaluation Spread to the US
Hundreds of bankers used their work emails to register for the adultery website AshleyMadison.com, MarketWatch found after searching the data. Hackers unleashed the email and
street addresses, phone numbers and credit card details of about 36
million users of the adultery website AshleyMadison.com. Here are the financial institutions MarketWatch searched for, and how many associated email addresses were found: Wells Fargo — @wellsfargo.com: 175 Bank of America — @bankofamerica.com: 76 Deutsche Bank — @db.com: 73 Goldman Sachs — @gs.com: 45 PNC Bank — @pnc.com: 28 U.S. Bancorp — @usbank.com: 15 Bank of New York Mellon — @bnymellon.com: 14 Citigroup — @citi.com: 51 J.P. Morgan Chase — @jpmchase.com: 9 Capital One — @capitalone.com: 4 MarketWatch also searched for
@marketwatch.com emails and found none. However, the website did find 10
@dowjones.com emails. (Dow Jones is the parent company that owns
MarketWatch.) The Hill reported that the leak appears to include more than 15,000 government and military emails. According to The Hill, Washington D.C. reportedly has the highest rate of membership for the site of any city. -RW
(WASHINGTON) Someone
call Dunder Mifflin: Several states are reporting a paper crisis, after
an Ohio company that produces highly specialized paper for vital
records closed without warning.
California has been hit the hardest by the shortage, and several
counties are now being forced to ration birth, marriage and death
certificates.
In California, the only other company that can meet its needs, under
state law, is in Canada. Officials say it would likely take months for
Canadian Bank Note Co. to get up to speed with the state’s paper needs –
but that’s only after a contract is signed. In the interim, counties
are left finding short-term solutions for the growing backlog.
The restrictions “will impact a lot of folks,” Rob Grossglauser, a
lobbyist for the County Recorders’ Association of California, told the San Francisco Chronicle.
The closure of Sekuworks, the Ohio paper company, has a handful of
states scrambling to find a fix, including Minnesota and South Carolina.
But California law is specific and requires the state to print all
vital statistic certificates using a specialized – and some argue
antiquated – type of printing, known as “intaglio.” Besides Sekuworks,
no other U.S.-based companies can handle that type of printing.
Since the company closed, several California counties there have
started to limit residents to one copy of a birth, marriage or death
certificate. The restrictions are creating major headaches for people
who are realizing just how important the documents are when trying to
obtain licenses, handle funeral arrangements or apply to schools.
Intaglio printing is done using ink that is below the surface of the
plate. The design is etched into the printing plate, which is typically
made from copper, zinc, aluminum and in some cases, coated paper. The
benefit of intaglio is that it’s a near-perfect way to prevent
counterfeits. Minnesota employs the method for a range of sensitive
documents and South Carolina – which recently adopted new standards –
used it for death certificates.
But critics argue it’s too labor intensive, antiquated and expensive.
In central California, Stanislaus County officials are now working
with area school districts to provide a free “verification of birth” for
people who otherwise would need a copy of their child’s birth
certificate to enroll in school.
California has two types of certified birth notices – an authorized
copy and an informational copy. While both are certified copies of the
original document, an authorized copy establishes the identity of a
person. An informational copy cannot be used for identity purposes and
carries an inscription across the face of the document stating,
“INFORMATIONAL, NOT A VALID DOCUMENT TO ESTABLISH IDENTITY.”
Informational copies are available to anyone who requests one. Authorized copies are not.
County Clerk-Recorder Lee Lundrigan sent letters to school districts
notifying them of the change and has been working to provide parents
with emergency options.
South Carolina initially addressed its paper shortage by limiting the number of death certificates it issued to five per person.
The move put pressure on funeral homes and handicapped their ability
to help families through the difficult process of losing a loved one.
While a five-certificate limit might sound like a lot, Pamela Amos,
general manager at McAlister-Smith Funeral Homes, told The Post and Courier
that most families need at least 10 certified copies of a death
certificate and that the state-sanctioned limits caused “a major issue
for a lot of families.”
The South Carolina Department of Health and Environmental Control –
the agency authorized to issue the certificates – was notified on July 9
Sekuworks had laid off most of its employees and was in the process of
selling its business.
South Carolina, though, lifted its five-copy limit on Aug. 11 after
the state signed a new contract with supplier R.R. Donnelley, Jim
Beasley, a spokesman with the state DHEC, told FoxNews.com. Beasley
indicated the state, unlike California, was able to revise its own
security standards, and in turn use a different kind of paper.
“In 2014, we had already begun the process of revising our
specifications for security paper to be used on birth and death
certificates,” Beasley said. “We had issued a request for proposals from
vendors to meet the new standard. Coincidentally, the bids for a new
provider were scheduled for opening on July 9, 2015, the same day we
were informed of the work situation with Sekuworks.”
The DHEC began processing back-order requests immediately and expects to resume normal operations by Wednesday, he said.
Meanwhile in Minnesota, officials at the state’s Department of Health
are working to establish a new contract with a new vendor. The state is
still about a month away before “everything is in place and a new
supply could start flowing,” Doug Schultz, a spokesman for the Minnesota
DOH, told FoxNews.com. Schultz believes there is enough supply
statewide to meet the demand if offices cut down on duplicates.
“Requests for certificates will continue to be fulfilled, but that
fulfillment may occur at locations people don’t regularly use, through
the U.S. mail or from neighboring county vital records offices,” he
said.
Multiple emails, telephone calls and other attempts by FoxNews.com to reach Sekuworks were not successful.
by James Quinn This doesn’t even take into account the hundreds of thousands
of people in Section 8 housing who are “earning” money under the table
and not reporting it to the IRS. Then there are the additional “tenants”
who pay to live there, which is also not reported. This article is only
the tip of the iceberg. Via Washington Post
A family of four in New York City makes $497,911 a year but pays
$1,574 a month to live in public housing in a three-bedroom apartment
subsidized by taxpayers.
In Los Angeles, a family of five that’s lived in public housing since
1974 made $204,784 last year but paid $1,091 for a four-bedroom
apartment. And a tenant with assets worth $1.6 million — including
stocks, real estate and retirement accounts — last year paid $300 for a
one-bedroom apartment in public housing in Oxford, Neb.
In a new report, the watchdog for the Department of Housing and Urban
Development describes these and more than 25,000 other “over income”
families earning more than the maximum income for government-subsidized
housing as an “egregious” abuse of the system. While the family in New
York with an annual income of almost $500,000 raked in $790,500 in
rental income on its real estate holdings in recent years, more than
300,000 families that really qualify for public housing lingered on
waiting lists, auditors found.
(HUD Office of Inspector General)
But HUD has no plans to kick these families out, because its policy
doesn’t require over-income tenants to leave, the agency’s inspector
general found. In fact, it encourages them to stay in public housing.
“Since regulations and policies did not require housing authorities
to evict over income families or require them to find housing in the
unassisted market, [they] continued to reside in public housing units,”
investigators for Inspector General David Montoya wrote.
The review, conducted in 2014 and 2015 at the request of Rep. Phil
Roe (R-Tenn.), found that 45 percent of the 25,226 public housing
tenants with incomes higher than the threshold to get into the system
were making $10,000 to $70,000 a year more. About 1,200 of them had
exceeded the income limits for nine years or more, and almost 18,000 for
more than a year.
HUD sets the low-income limits at 80 percent and very low-income
limits at 50 percent of the median income for the local area. The agency
sets “fair market rents” every year based on incomes, housing demand
and supply. In Los Angeles, for example, the threshold was $70,450 for a
family of five. In Oxford, Neb., it was $33,500 for an individual.
New York, Puerto Rico and Texas had the most over-income families in
public housing, while Utah, Idaho and Wyoming had the fewest,
investigators found.
(HUD Office of Inspector General)
About 1.1 million families in the country live in public housing. The
over-income tenants represent 2.6 percent of the system. Based on these
numbers, HUD officials said the inspector general was “overemphasizing”
the problem. But the watchdog didn’t buy it.
“Although 25,226 over income families is a small percentage of the
approximate 1.1 million families receiving public housing assistance, we
did not find that HUD and public housing authorities had taken or
planned to take sufficient steps to reduce at least the egregious
examples of over income families in public housing,” the audit said.
“Therefore, it is reasonable to expect the number of over income
families participating in the program to increase over time.”
The watchdog estimated that taxpayers will pay more than $104 million
over the next year to keep these families in public housing, money that
should be used for low-income people.
But under HUD regulations, public housing tenants can stay as long as
they want, no matter how much money they make, as long as they are good
tenants. The agency is only required to consider a tenant’s income when
an individual or family applies for housing, not once they’re in the
system. This is different from the housing choice voucher program that
used to be called Section 8, which gives families subsidies for rentals
in private apartment buildings. That program has an annual income limit;
tenants who go above it get less money.
Tenants can wait years to get into both programs.
(HUD Office of Inspector General)
HUD tweaked its policy on high-earning tenants in 2004, encouraging
the thousands of housing authorities in the system to move families out
of public housing if they earn more than the income limit for their
area. While HUD gives money to the housing authorities, they’re run by
states and local governments.
But the 15 authorities investigators looked at told them they had no
plans to evict these families, because if they did, poverty would
continue to be concentrated in government-subsidized housing. The goal,
they said, was to create diverse, mixed-income communities and allow
tenants who are making good money to serve as role models for others.
HUD officials repeatedly objected to the audit, saying that evicting
over-income families could “negatively affect their employment and
destabilize properties.”
“There are positive social benefits from having families with varying
income levels residing in the same property,” Milan Ozdinec, HUD’s
deputy assistant secretary for public housing and voucher programs,
wrote in a lengthy rebuttal to the inspector general.
“Forcing families to leave public housing could impact their ability
to maintain employment if they are not able to find suitable housing in
the neighborhood,” Ozdinec wrote. “Further, for families with children,
it may be more difficult to find affordable child care, and it may
impact school-age children’s learning if they are forced to change
schools during a school year.”
The watchdog said it didn’t believe that HUD should kick out every
family that earns more than the income threshold. But at the very least,
the agency should create “limits to avoid egregious cases.”
(Susan Madrak) Grayson is really good at getting bipartisan support for his bills, and he says he thinks he can get this one passed:
Shoring up Social Security and Medicare are among the
issues Alan Grayson has said he wants to emphasize as a candidate for
the Democratic U.S. Senate nomination.
Following up on that promise, Grayson has unveiled a proposal that would increase Social Security retirement benefits and tie future increases to a new cost-of-living index.
The Orlando Democrat says that cost-of-living-allowances (COLAs) have
been miscalculated for decades, saying that when they were introduced
in 1975, they’ve been calculated on the cost of living for people who
work. But he says that most people on Social Security are obviously
retired, so the government has been consistently understating the
increase in inflation that seniors face on a year-to-year basis.
Seniors spend twice as much on health care as other people do, he said. “And
the cost of health care has risen much faster than the general costs of
living over the past 40 years, but that isn’t reflected in their
adjustments,” he said. “On the other hand, seniors use less
gasoline than other people do.” He said the cost of gasoline hit an
all-time high in real terms in 1981, and has been falling ever since.
Overall, Grayson said, seniors have been cheated out of more than $300 billion.
The congressman and Senate candidate said he also has another bill on
addressing Social Security solvency that he’ll introduce later this
year.
But he says the short answer to curing any concerns about the
program’s life is to “scrap the cap.” That’s shorthand for eliminating
the current cap on payroll taxes that come out of salaried workers
checks and goes toward the federal retirement benefits program. Right
now, every American is taxed at a 6.2 percent rate, until they reach
$117,000 a year. Then the tax is cut off.
He uses the salary of NBA star LeBron as an example of the inequities with the current system.
“LeBron James makes over $20 million a year, He gets paid to play 82
games a year. He’s done paying his Social Security in the first quarter
of the first game of the year, and for the rest of that game, for the
rest of the next 81 games, he doesn’t have to pay anyting in Social
Security,” he says. “That isn’t really fair. If you scrap the cap, then
Social Security is solvent forever.”
Grayson is confident he can get his soon-to-be officially filed bill through Congress.
“I think they’re actually good,” he said about the prospects of
passage.”We’re talking about being fair to seniors. Seniors can be
Republicans, Democrats, independents.This is not really an
ideological matter in any real sense. It’s a matter of the government
essentially cheating seniors out of large amounts of money, and I think
the Republicans should be just as sensitive of that as the Democrats, that we need to be fair to everybody and keep the promises that we make.”
(News Machete) Did
you know that under certain circumstances, sellers of TV stations had
to pay higher taxes when selling the stations to white people than black
people? It sounds racist (it is racist!), but it is true. Even more
bizarre, liberals want to reinstate it, creating different tax rates based on the color of the skin of the buyer:
Minority owners are burdened by the legacy of racism.
When the U.S. government first started giving away our airwaves in the
1930s, they were distributed exclusively to white, male owners. It
mostly stayed this way until the 1970s, when the FCC tried to remedy the
problem by implementing a “Minority Ownership Policy.” The measure
offered tax incentives to people seeking to sell stations to minority
owners.
In other words, sell to a minority, and you get a lower tax; sell to a
white person, and you get a higher tax. I wonder if the old apartheid
South Africa had race-based taxes as well…or is this just something
liberals here perfected?
The policy worked. Within two years of its passage, the
country went from one black-owned television station to 10. Over its
total 17 year existence, minority ownership increased five-fold. But it
was struck down by the newly-elected Republican Congress in 1995 and
since then, its success has been mostly undone
What business does the Congress have meddling in the private sector,
setting tax rates based on race? What busines is it of Congress to
determine the “appropriate” level of minority ownership of television
stations?
More importantly, what does it mean to have minority ownership of a
television station? Many stations are owned by publicly traded
companies. Was Time Warner “black” when Dick Parsons was in charge but
“white” now that he is gone? When you start trying to classify large
companies by race, you see how ridiculous it becomes.
Last year, in fact, just two television stations were owned by black owners.
And how many were owned by publicly traded companies, or private
companies with a diverse ownership? The WaPo didn’t see fit to report
that. It’s like saying, “Why aren’t more oil companies owned by
blacks? Why isn’t ExxonMobil, the publicly traded company, ‘black'”?
Media consolidation is at the heart of the problem. Clear
Channel, for example, famously wiped out small and minority radio
station owners with its buying spree, which allowed the company to
snatch up as many as seven stations in a single market.
How awful! In a private market, black owners voluntarily sold their stations and made a profit.
Racism is where TV station owners refuse to sell their companies to
minorities when they put them on the market. Racism is also setting tax
rates based on race. But “not enough black owned stations,” by itself,
means about as much as “not enough blacks at the ballet.”
Down nearly 5% right now.
Via: Reuters:
Oil prices fell about 4 percent on Wednesday, with U.S. crude
hitting 6-1/2 year lows and threatening to break below $40, after a huge
unexpected stockpile build in the United States reinforced concerns
about a growing global oil glut.
U.S. crude inventories rose by 2.6 million barrels last week to
456.21 million, the government’s Energy Information Administration said.
The figures stunned energy market analysts on Wall Street, as well as
traders and investors who had been expecting a stockpile drawdown
despite the peak U.S. summer driving season nearing its end and refinery
problems cutting fuel processing capabilities.
(Ambrose Evans-Pritchard)
World shipping has fallen into a deep slump over the late summer,
dashing hopes of a quick recovery from the global trade recession
earlier this year and heightening fears that the six-year economic
expansion may be on its last legs.
Freight rates for container shipping from Asia to Europe fell by over
20pc in the second week of August, even though trade volumes should be
picking up at this time of the year. The Shanghai Containerized Freight
Index (SCFI) for routes to north European ports crashed by 23pc in five
trading days.
The storm in the shipping industry comes as the New York state manufacturing index for
July plummeted to a recessionary low of minus 14.9, the lowest since
the Great Recession and one of the steepest one-month drops ever
recorded.
The new shipments component fell to -13.8, and new orders to -15.7. A
similar drop occurred in 2005 and proved to be a false alarm but the
latest fall comes at a delicate moment for the world economy.
There is now a full-blown August storm sweeping through global
markets. The Bloomberg commodity index dropped to a fresh 13-year low on
Monday and the MSCI index of emerging market equities touched depths
not seen since August 2009.
A closely-watched gauge of emerging market currencies has fallen for
the eighth week – the longest run of unbroken declines since the
beginning of the century – led by the Malaysian Ringgit, the Russian
rouble and the Turkish lira. Asian currencies have dropped against the dollar over the last year
China’s surprise devaluation last week continues to send after-shocks
through skittish global markets, already on edge over a likely rate
rise by the US Federal Reserve in September – though this is now in
doubt.
The currency move was widely taken as a warning that the Chinese
economy is in deeper trouble than admitted so far, a menacing prospect
for exporters of raw materials and for trade competitors in Asia. It
threatens to transmit a fresh deflationary impulse through the global
system.
The great worry is that companies in emerging markets will struggle
to service $4.5 trillion of US dollar debt taken out in the boom years
when quantitative easing by the Fed flooded the world with cheap money,
much of it at irresistible real rates of 1pc. This is up from $1
trillion in 2002.
The monetary cycle has gone into reverse since the Fed ended QE in
October 2014 and cut off the flow of fresh liquidity. While the first
rate rise in eight years has been well-telegraphed, nobody knows for
sure what will happen once tightening starts in earnest.
This stress-test could prove even more painful if China really has
abandoned its (crawling) dollar peg and is seeking to protect export
margins by driving down its currency.
The yuan has risen by 60pc against the Japanese yen and 105pc against
the rouble since mid-2012. Yet China nevertheless has a trade surplus
of 6pc of GDP.
Data from the Port of Hamburg
released on Monday show much damage this currency surge may be doing to
Chinese companies. Axel Mattern, the port’s chief executive, said a
10.9pc drop in trade with China was the chief reason why volumes of
container cargoes passing through the port fell 6.8pc in the first six
months.
“During the first six months of the years the euro was on average 19
percent lower than the yuan, making purchase of Chinese goods costlier
for European importers,” he said.
If so, this is grist to the mill of those arguing that China timed
its switch to a market-driven exchange rate in order to disguise what is
really “currency warfare”, or a beggar-thy-neighbour strategy as it
used to be known. The Chinese central bank has dismissed such claims as
“nonsense”. It has intervened to stabilize the yuan over the last three
days.
The port of Hamburg said trade with Russia collapsed by 36pc, the
latest evidence that the rouble crash and deepening recession has forced
Russian consumers to cut back drastically on purchases of imported cars
and heavy goods.
The Dutch CPB index of world trade fell in both April and May in
absolute terms, culminating five months of dire shipping activity. It
had been widely-assumed that the worst was over. World trade has slumped
Yet more recent data from Container Trades Statistics shows that
global volumes fell 3.1pc in June from the already depressed levels the
month before. This has come as shock: the period from June to August is
typically the strongest time of the year, boosted by pre-shipments for
the Christmas season.
What is even more disturbing is that fresh port data from Asia
suggest that the downturn dragged on into July, and may even have
deteriorated.
Singapore – the world’s second largest entrepot – saw a 13.3pc
contraction in container volumes from a year earlier, the worst
performance since the sudden-stop in trade after the Lehman crisis.
The growth in cargo shipments for all the major ports in East Asia
(that have reported so far) fell to a new cycle-low of 0.6pc in July,
according to tracking data collected by Nomura. “The clock is ticking on
the third quarter. We remain sceptical of those trying to “call a
bottom”,” it said.
It is still unclear how much of this weakness reflects recessionary
conditions, and how much stems from a more benign shift in the structure
of the global economy.
China’s reliance on imported components for its export industry has
fallen to 35pc from 75pc in 1992 as the country moves up the technology
ladder. The Communist Party is deliberately weaning the economy off
heavy industry and mass production, shifting to a more mature service
economy that relies less of trade.
At the same time, the US and Europe have been “re-shoring”
manufacturing plant from China as Asian labour costs rise, reversing the
process of globalisation.
These changes mean that the “trade-intensity” of the global economy
is falling. The trade share of world GDP was 40pc in 1990. It rose to a
peak of 61pc in 2011, and has since drifted down to below 60pc.
A recent study
by the International Monetary Fund said the expansion of global supply
chains driven by the US and China in the early 2000s is “exhausted”.
The implication is that trade is no longer the pulse of the global economy. Other indicators are less worrying.
Both credit and key measures of the money supply are rising briskly
in Europe, the US, and latterly in China as well, pointing to a recovery
later this year. These forces may prove to be more powerful in the end.
`
(CALIFORNIA)
A Pacific Northwest grocery chain that recently acquired two Coachella
Valley stores is closing 27 locations, including 16 in California.
Haggen called the move an effort “to continue to improve its business and strengthen its competitive position.”
Neither of Haggen’s Coachella Valley locations will be impacted at this time.
In December, Haggen took over the Vons location in Palm Desert on
Highway 111, and the Pavillions on Bob Hope Drive in Rancho Mirage.
In a news release,
a Haggen representative said most of the stores being closed or sold
had been acquired as part of a divestment deal with Albertsons and
Safeway. At that time, Haggen expanded from 18 stores to 146, and
increased its workforce from 2,000 to 10,000.
More stores could close in the future.
“Haggen’s goal going forward is to ensure a stable, healthy company
that will benefit our customers, associates, vendors, creditors,
stakeholders as well as the communities we serve,” said Haggen CEO
Pacific Southwest, Bill Shaner. “By making the tough choice to close and
sell some stores, we will be able to invest in stores that have the
potential to thrive under the Haggen banner.”
Stores slated to close: Arizona
Tucson – 10380 E Broadway Blvd.
Tucson – 8740 E. Broadway
Anthem – W. Anthem Way
Flagstaff – E. Route 66
Prescott Valley – E. Hwy. 69 California
Newbury Park – Newbury Rd.
Los Osos – Los Osos Valley Rd.
Simi Valley – Cochran St.
Simi Valley – Madera, 660 E. Los Angeles Ave.
Bakersfield – E. Stockdale Hwy.
Santa Clarita – McBean Pkwy.
Irvine – Portola Pkwy.
Mission Viejo – Los Alisos Blvd.
Tustin – 17th Street
San Marcos – Rancho Santa Fe
El Cajon – Fletcher Pkwy.
La Mesa – Lake Murray Blvd.
Chula Vista – Telegraph Canyon Rd.
Chula Vista – Third Ave.
San Ysidro – W. San Ysidro Blvd. Oregon
Tualatin – SW Tualatin-Sherwood Rd
Klamath Falls — North 8th St.
Klamath Falls – South 6th St
Grants Pass – NE Beacon Dr.
Keizer – River Road North Washington
Spanaway – Pacific Ave. S.
Jennifer Larino)
Layoffs are starting to hit New Orleans as Royal Dutch Shell moves
forward with plans to eliminate 6,500 jobs worldwide. The cuts come as
Shell seeks to cut costs amid lower oil and gas prices.
Shell spokeswoman Kimberly Windon confirmed in an email the company
has started to cut jobs at its New Orleans and Houston offices, though
it is not providing a “specific breakdown of workforce numbers.”
About 2,300 Shell employees and contractors are at One Shell Square
on Poydras Street, and the majority support Shell’s drilling and
exploration operations in the deepwater Gulf of Mexico. Windon said the
deepwater segment “continues to be an important part of the Shell global
portfolio.”
“We had to make some difficult decisions in an effort to reduce costs
while seeking opportunities to improve efficiencies and ensure
long-term competitiveness and profitability,” Windon said.
According to sources at One Shell Square, employees and contractors
in New Orleans were told earlier this month that Shell plans a 30
percent cut to its local workforce by November. The sources asked not to
be named out of concern for their jobs.
Sources said Shell has started to offer severance packages to senior workers.
Windon said the New Orleans cuts are “part of a global reduction”
and, as such, the company is not disclosing workforce numbers specific
to each market.
Royal Dutch Shell, based in Holland, said July 30 it would cut its
capital investment and reduce its global workforce by 6,500 positions as
falling oil prices continue to undercut profit. Shell employs about
94,000 worldwide.
Shell reported $3.8 billion in second quarter earnings, down from $6.1 billion during the same period in 2014.
Oil prices reached $40.77 per barrel in futures trading Wednesday
morning — their lowest level since March 2009 and down from $92 a year
ago. Read the full email statement from Shell spokeswoman Kimberly Windon.
We live in some kind of fractal economy in which everything is connected and no one knows, how this macroeconomy
is working. This fiat currency miracle is working some how. It’s fake
and illusion and its working. I expected crash 2 years ago and bubble is
just expanding since then.
But anyways – we need new Breton woods. We need new currency for new
millenium. Now we live in a world, when dollar empire is slowly
disintegrating. Bretton woods put all the power into hands of few, who
control the most powerful currency of all times – dollar. And now, when
dollar is dying, its masters don’t want to let all that power out of
their hand.
And as wounded beast is most bloodthirsty, world is drowning in
blood… Only collapse of dollar can stop this madness, but there will be a
lot of blood…
Weekly Commentary: China
…The “currency war” issue garnered deserved attention this week. With
currency markets in disarray and disinflationary pressures mounting
globally, increasingly desperate central bank measures attempt to spur
inflation. “Enrich thy neighbor” – Ben Bernanke’s answer to
“beggar thy neighbor” concerns – sounds even more ridiculous these days.
Asian currencies were under intense pressure this week. Perhaps it’s
related to fears of a cycle of competitive devaluations. Mainly,
I believe it is part of an intensifying exodus of “hot money” from a
region especially vulnerable to financial contagion, instability and
even calamity. And the more currencies weaken the more unmanageable the
debt loads. Chinese devaluation only stokes this fire.
This week’s 2.8% currency decline (vs. the dollar) offers little
relief to Chinese manufactures. And while I do believe the Chinese
economic downturn has gained important (post-stock market Bubble)
momentum, I don’t see economic weakness as the driving force behind this
week’s policy move. Chinese officials are alarmed about a sudden Credit
slowdown and the risk of a self-reinforcing deflationary dynamic. The
Chinese are fearful of their increasingly fragile Credit system.
Currency pegs are dangerously seductive. The longer they remain in
place the more advantageous they appear. They are pro-“hot money” flows.
Over time they become increasingly pro-leverage and speculation. They
are pro-Bubble – which means pro-tantalizing boom. In the end, currency
peg regimes ensure precarious financial and economic imbalances. And,
repeatedly, derivatives markets have become the epicenter of boom and
bust dynamics. Peg the two most important global currencies together,
adopt flawed policies, let Bubbles run loose, promote historic
expansions of “money” and Credit – and you’re asking for trouble.
Most view the Chinese currency as fundamentally strong. Surely
Chinese policymakers see it this way. After all, China has a colossal
export sector. The People’s Bank of China is sitting on an unmatched
$3.7 TN hoard of international reserves. But is the currency sound? What
are intermediate to longer-term prospects? How fragile is the Chinese
Credit system? How much central government debt and monetization will be
employed to counter a Credit and economic bust?
… http://creditbubblebulletin.blogspot.com/2015/08/weekly-commentary-china.html
Bad Moon rising: Americans bracing for September shocker
Across the vast expanse of the
internet, everyone from professional economists to armchair theorists
are sounding the alarm that next month may hold some ugly surprises for
the global economy.
Despite exorbitant executive salaries, record earnings on Wall Street
and a surging dollar, an increasing number of forecasters are warning
the feel-good data is severely skewered – a bit like a new coat of paint
that used-car dealerships use to conceal the fact that a car’s engine
is shot. Indeed, many experts are giving the rickety US-made jalopy just
months before the big collapse begins.
Gerald Celente, the founder of Trends Research, who predicted the
“panic of 2008,” says the economic earthquake will send reverberations around the world. “You’re going to see a global stock market crash,” Celente told King World News. “There’s going to be panic on the streets from Wall Street to Shanghai, to the UK down to Brazil.” “You’re going to see one market after another begin to collapse.”
Doug Casey, a successful investor and the head of Casey Research, saw little to be upbeat about in the current economic climate.
“With these stupid governments printing trillions and trillions of
new currency units,” Casey, describing the US Federal Reserve’s
quantitative easing program, told Reason magazine in a recent interview, “it’s building up to a catastrophe of historic proportions.”
And he certainly does not advise keeping much money in any financial institution. “Most of the banks in the world are bankrupt,” he said.
In a recent conversation between senior analyst Larry Edelson and
Mike Burnick, the Research Director for Weiss Research, Edelson made a
stunning prediction, even providing an exact date for what he predicts will be a “rollercoaster ride through hell.” “On October 7, 2015, the first economic super cycle since 1929
will trigger a global financial crisis of epic proportions. It will
bring Europe, Japan and the United States to their knees, sending nearly
one billion human beings on a roller-coaster ride through hell for the
next five years. A ride like no generation has ever seen. I am 100
percent confident it will hit within the next few months.”
And there are dozens of other such apocalyptic predictions on the
health of the global economy that it leaves one feeling dizzy and
desperate – something like watching an approaching tidal wave in the
full knowledge there is no hope of outrunning it.
Meanwhile, confidence in the US economy among Americans dropped
sharply in July to its lowest level in 2015, according to a new US
Economic Confidence Index rating released by Gallup earlier this month.
Perhaps the non-stop onslaught of super-negative news – everything
from the Greek tragedy to the Chinese currency devaluation – has got
Americans convinced the global economy has entered dangerous waters.
Indeed, scratch the shiny surface of the US economy and the wear and
rust is immediately apparent.
Jeff Berwick, Canadian entrepreneur and editor of The Dollar Vigilante, recently told Gordon T. Long in an interview:“There’s enough going on in September to have me incredibly curious and concerned about what’s going to happen.” http://www.rt.com/op-edge/312576-september-economy-crash-eclipse/ Hedge fund billionaire Stan Druckenmiller has made a huge bet on gold
Legendary hedge fund manager Stanley Druckenmiller, who runs Duquesne
Capital, made a huge bet on gold during the second quarter.
Duquesne, which is now run as a family office, finished the second
quarter with 2.88 million shares of SPDR Gold Trust, according to the
fund’s 13F filing.
The new position is now Druckenmiller’s largest long position.
Druckenmiller’s GLD stake had a value of $300.3 million at the end of the quarter based on the June 30 closing share price of $104.27. Shares of GLD have fallen 5.5% since then.
Druckenmiller has previously said that when he sees something that really excites him he will “bet the ranch on it.” We reached out to Druckenmiller for comment on his GLD position.
Druckenmiller also increased his position in Facebook to 1,872,700 shares, up from 252,000 shares in the first quarter.
He also took big new positions in Freeport-McMoRan (3.547 million
shares), Halliburton (1.547 million shares), and Wells Fargo (1,679,400
shares), the filing shows.
Read more: http://www.businessinsider.com/druckenmiller-buys-gld-shares-2015-8#ixzz3j7cZbruf
As markets await the release of the minutes for the July Federal Open
Market Committee (FOMC) meeting, Kitco’s global trading director Peter
Hug tells Kitco News he doesn’t expect the central bank to make a move
on rates in September. “I’ve been in the camp that the Fed may not move
until 2016,” he says. “I’m sort of begging Yellen to raise the rate in
September and get it out of the way. She’s got herself in a corner.”
Looking at gold, Hug seems optimistic about the metal, stating that he’s
’surprised’ with the current consolidation levels. “Every time gold
tries to break down below $1,110 there seems to be buying interest. So I
am constructive gold at these levels.” Hug shares the same sentiment
towards silver, although he adds that it may be a little riskier right
now. “Silver is still tentatively a bit of a risk here but at a 75:1
ratio…I think silver is a good buy at the 14.80 level.” Tune in now to
find out where he sees the gold and silver prices headed for the rest of
August. Kitco News, August 19, 2015.
by Dana Lyons
You may hear the term “decouple” bandied about in investment circles
when discussing global markets. It simply refers to one market’s ability
to move irrespective of other global markets. In recent years, unlike
emerging markets, developed markets have tended to move more or less in a
correlated fashion, i.e. they have not decoupled. This has been
especially true this year as emerging markets have had a rough go of it
while most developed markets have hung in pretty well, even if they
haven’t made much headway.
One subtle change in this dynamic occurred last week. Most developed
markets have weathered the recent volatility without breaking any key
support levels. The Australian stock market is an exception, however,
having now broken, er, down under a key support area.
Specifically, the broad Australian All Ordinaries Index broke below
the 5440 area which was marked by several key analyses including:
The 23.6% Fibonacci Retracement of the 2011-2015 Rally ~5459
The 38.2% Fibonacci Retracement of the 2013-2015 Rally ~5447
The 61.8% Fibonacci Retracement of the 2014-2015 Rally ~5443
The Post-2012 UP Trendline
For the All Ordinaries Index, this 5440 level now becomes resistance
that should pose a hurdle to any bounce attempt. Meanwhile, it opens up
immediate downside of about 5% down to the 5120-5150 level. While that
isn’t a substantial amount of risk, there may be a bigger message to the
price violation.
Given the lack of decoupling – again, most developed markets have
been highly correlated – an expectation has developed that these markets
will trade in lockstep. Therefore, with the rest of the developed world
exhibiting impressive resilience, the possibility of any type of
meaningful price breakdown has been considered remote. Perhaps this
breakdown in the Australian market at least cracks the door open a bit
more to that possibility.
Certainly the dynamics of the Australian market, e.g., heavily
influenced by commodities and China, render it unique among the
developed world. Thus, it is possible that it truly has decoupled and
that the recent price breakdown is simply a one-off. Then again, perhaps
it is a warning that the major global indices are not as bullet-proof
as they are thought to be.
KIEV, August 19. /TASS/. In the
framework of aid to Poland, the power engineering sector of which has
been hit by an anomalous heatwave, Ukraine will sell electricity to that
country at 7.5 eurocents per 1 kwh, the National Commission for Energy
and Utilities said on Wednesday.
Operators of Polish and Ukrainian power grids signed an agreement on
August 17 on supplies of electricity to Poland. The national operator of
power grids, Ukrenergo, says the maximum size of Poland’s emergency
need for electricity is 235 megawatts.
Experts say 7.5 eurocents per 1 kwh is high enough a price. It stands
in a marked contrast to the 3.68 eurocents per 1 kwh, which the
Minister of Energy and Coalmines Vladimir Demchishin named to TASS
somewhat earlier as the price of purchasing electric power from Russia.
Exports of Ukrainian electricity to Russia from January through to
June 2015 totaled 0.8 million kwh, while in the same period of last year
no such exports took place.
At the same time, Ukraine imported 1.393 billion kwh of electricity
from Russia. The exports in June alone totaled 2.8 million kwh.
KIEV, August 19. /TASS/. In the
framework of aid to Poland, the power engineering sector of which has
been hit by an anomalous heatwave, Ukraine will sell electricity to that
country at 7.5 eurocents per 1 kwh, the National Commission for Energy
and Utilities said on Wednesday.