Looking forward to Market Activity today, 2-11-16, and the "No-Name Collapse"

Bloomberg Futures are not reassuring given the earlier stock market performances in the orient and Europe.

Hong Kong's Hang Seng index was down 42 to 2,539; China's Straights Times was off 12.5 at 2,589. Since the high in the past 52 weeks of 3,507 last April 15th, that is a casual drop of 26%! Nothing to sneeze at.

Europe fares not much better. And, today, Bloomberg shows DJIA futures off in the high 3 digits, inching toward a 300 drop for the day within the realm of reality - or another drop of less than 100 points as recently noticed. Reuter's news leads ponder the resolve of the Fed in Yellen’s announcement yesterday. The new president of the Cleveland Fed, Loretta Mester, took a hawkish position, declaring the US would overcome this "soft Patch". So, to create a softer patch: oil drops further today; gold takes another leap to a position at 1242 about the time of the NY market’s opening; and the global markets toss a flippant glance toward Olivier Blanchard who was "puzzled" by the their movements about 4 weeks ago. He would be - (along with his compatriots such as Paul Krugman who touted the "Not-So-Bad Economy”, in a piece just two months ago, when he lauded Bernanke's courage and "willingness to step in and rescue the financial system") - if he and others stuck with their models and ignored the more honest updates in consumer markets.

This flippancy is not carried on in today's news where the dropping price of oil is still featured in assessing the inflation/deflation situation and the insistence on a low inflation index of 1.4% assuring us the household consumer is not in desperate straights. Again, we insist - Ask the housewife! She finds herself negotiating the turbulence between our modern day Charybdis and Scylla theory and reality – and that desperation carries over to the stock markets these days – our western pundits to the contrary.

A drop of 26% in the Chinese markets cannot be dismissed with a declaration that conditions do not warrant the drop, as Blanchard stated January 18th last. He advanced a couple of arguments protesting the connections, “neither of them convincing.” Conviction would depend on what is offered as a foundation for the rationale. Confusion does not serve in this instance. And, whether “stock market herding” has any place in the current penchant for explanation through “modeling” leads to another series of poorly defined puzzles.

It may seem unfair to separate Blanchard from the field of theoretical economists inasmuch as most of what he has noted in his writing during the recent past is not foreign from O&G’s thoughts. But, the weakness in the satchel full of “tools” today’s trained Economists carry is obvious: faced with melting economies confronting us currently, one attempt after another fall by the wayside and we continue to “slip sideways” with no promise of deliverance from disaster to be found. As a matter of fact, if we were to line up the outstanding papers assessing the situation since 2008 or 2009 Which I’ve attempted with the actual works, the confusion is compounded in the variety of assessments of causes and prognoses which have neither explained nor come to pass.

It’s also begging the question by insisting that we are in an expected situation when we introduce the concept of “secular stagnation”. The name does not competently define the ailment. The doubts that circle the globe dwarf the assurances expressed in economic theory causing a great deal of grief among the economists themselves, with their growing expression of dissatisfaction with the direction being taken – as evidenced in such pieces as the variety of names attached to our condition, in the “secular stagnation” of Larry Summers/Brad DELong/Paul Krugman, the “Balance sheet” disaster of Richard Koos, the ZLB economy, or any of the other descriptions.

We might eventually end up with an economic event being tabbed the “No Name Collapse” to avoid developing more confusion.

We Are Moving Into A New Phase

Mitch McConnell steps out of his foxhole today and says-- the Senate Majority will deny Obama any recommendation to fill the vacant Supreme Court seat until after November. He presumes-- November brings two things, a Right-Wing POTUS and the re-election of his fellow Republican majority. The majority of Congressional seats are up for election in November. The majority of Americans are not expected to put anyone back in Congress. Mitch likely committed his Fate to an adverse outcome... IF America is actually still intact come November 4th. A lot more people are saying it is not robust, rosy, cozy or stable in America. Meanwhile... Europe looks like bad toast left out in the rain- moldy and smelling of decay. That said-- China acts an awful lot like the Japanese in a Godzilla movie now. All the moves are jagged, jerked and don't seem to change the course. Russia gets a Syrian peace... whatever that means. Troops remain in place and no nation lays claim to that land's oil yet. Speaking of oil... we're oozing with it. There is a problem with this global glut--- it illuminated the plot that took place after Desert Storm on into 9/11. It tells the world that Texas Oil Moguls might have triggered a series of terror acts to engage America's financial, military and political forces to make oil land conquests.

I'm planning on investing in gas chambers. One clear thing is evolving now... those who caused all this world woe have lost some footing and while pretending a cool... are freaking out. When linear thinkers are drawn out into Chaos, it doesn't take long to spot something wrong. March brings an end to the First Quarter 2016. My thoughts are that the "data" cannot be sculpted that much to hide what is reality now-- secular stagnant, dead economies and a war game that ends with octogenarian exposure. The mighty fall hardest but in this case, the greediest just drop like litter in a box.

Are We Moving Into A New Phase?

My parents, finally, moved here. My grandma's house in Tuscany has reopened. My grandma's house is my favorite place in the world. Everytime I go to my grandma's house I don't want to leave.
" We are moving into a new phase" you say.
So, while I am enjoying the villa and my parents, the insane neoconservatives might be preparing the end of the world as we know it?


Macro: it is obvious that the financial component of oil controls the world's economics-- not it's economy. There is no economy and there is a growing need for one. All those in control today are old. The idea of waiting for them to die is absurd. The coming war will be more about gutting fortresses than anything else.

Neoconservatives are getting their butts kicked royal in GOP POTUS campaigning. The latest articles suggest that Trump will be the Republican candidate and Hillary Clinton will be the Democrat. Republicans don't want Trump, so it is interesting to watch the build-up because it tells us one absolutely clear FACT-- that neoconservatives are dying off. That said-- Clinton is a ticking time bomb. If she is elected, we will have war in America before inauguration.

A few FACTS about the world's nearer future. A glut of oil is causing an adverse impact on use. Fewer people using less oil is causing less demand for supply. Oil by-products are unpopular now. We use glass again for storing food. We wear cotton and a lot of the cotton we wear is thrift, not new. A dead economy means no manufacturing and plenty of surplus. The American South has a surplus of guns. The American North, East and West have ordinary citizens with stockpiles of goods that can and will derail big business's attempt to kindle recovery without jobs. There are way too many lawyers, financiers, paper and button pushers... administrative roles will likely become Minimum Wage jobs because those who can do enterprise and employ basic software will never need these people. The one cold stone FACT that is glaring at the world right now is-- the lack of leadership. Everyone in a leadership role today-- be it corporate, government, whatever... is inept. As the world runs out of hope later this year, it will also grow completely intolerant of groups that collude and put a stooge in a driver's seat.

I would like to visit Tuscany one day. There is nothing a neoconservative can aspire to do that cannot be resolved by a swift blow from a baseball bat. Indeed, the world is troubled... but more it's woes stem from those doggedly trying to maintain an impossible Status Quo, than anything else. When we individualize again-- and that is coming faster now-- a neoconservative will stick out. The point-- be SOMEBODY when you are individualized. Bookkeepers cannot.

Something Interesting...

Global Sweet Brent Crude Oil is selling for $3 barrel more than American Sweet Brent Crude Oil. Ergo-- countries worldwide are paying more if it comes from someplace other than the USA. At just over $31 per barrel, crude is not even remotely close to breaking even with the cost to produce it. In a nutshell, our oil sector is a liability and the cost validates my choice of words-- bailing. We are mortgaging our future to float Big Oil now. Yesterday... we saw a 300 point turn-around for the Dow. In actual dollars (fake fiat or otherwise) that swing was a half a trillion thing. Americans gained nothing from that credit extension and get nothing for continuing to fund dead oil.

Let's take a look at one SHOULD be a priority now. $20 per hour for a 40 hour work week is $800 gross. The net from that is $560 per week. Where you live requires 1.5 weeks of net pay for the note, another .5 for the utilities. Car loan/lease plus gas and maintenance is another week. From the remaining week you pay for groceries, cell bill and a minor amount on accumulated debt... which is growing. So... at $20/hour today, the average person is drowning, not keeping their head above water. Less than 20% of all jobs in America pay $20/hour or the equivalent in salary. The FACT is-- 80% of our nation cannot afford to live here.

Meanwhile... we still pump out MBA degrees, they still cut costs and erode the infrastructure and we continue to bail Big Oil instead of igniting economy by funding small enterprises and barring BIG from credit extension. The future looks pretty obvious now.

Oil, The Industry That Threatens Us With Destruction...

....is being bailed out with public money.

Cheaper oil means that more will be burnt, accelerating climate breakdown. When fossil fuels are cheap, people will find ways to burn them and that's gloomy news for the prospects of curtailing climate change. Low oil prices will slow down the rate of innovation in the clean energy sector.

Does a failing oil price drag down the price of gas, exposing coal mining companies to the risk of bankruptcy? Good riddance to them.
Already, according to the IMF, more money is spent on subdising fossil fuels than on funding health services.
As they did for the bankers, political leaders ensure that everyone must pay the costs imposed by the fossil fuel companies, except the fossil fuel companies.

The UK energy secretary, Amber Rudd, says she stand "100% behind this fantastic industry". She will build a bridge to the future for UK oil and gas." Had she been born 300 years ago, I expect she would have said the same about the slave trade.

Crises expose corruption. When your friends are in trouble, the rigours imposed upon the poor and public services suddenly turn out to be negotiable. Throw money at them, trash their competitors. Those who deserve the least receive the most.

total disconnect

What can I say that hasn't already been said? Folks that sold at or near the January lows are now buying the rip.
Minimum wage earners are supporting a blowhard that would short change them five dollars after a price of $20.00 was agreed upon to shovel the snow from his walk.
The economy sucks yet the US market is ramping up because crude oil goes up a buck a bbl. Last week gas cost $1.39/gal and today it's $1.89.
Old rednecks support Trump, a proven liar, and former old activists support Hillary, a proven liar.
The world is a wreck. So what do we do? Let a bunch of clueless central bank economists call the shots.
You are correct. $20.00/hr is a tough place to be. Too much to qualify for assistance and too little to raise a family (unless mom works too and relinquishes child rearing to someone else).
This isn't even fun to watch anymore. Like a really cheesy reality show.

Nothing But Air Under The Markets Now

Sure... it's often confusing to ascertain our course and position with so much phony media spew, but clearly now... as the Federal Reserve actually acknowledges inflation while ignoring all the other obvious facets of failure THEY sculpted... catastrophic collapse is really on the table. Everybody who thinks they are somebody is talking smack but no one is addressing the critical condition of the ordinary consumer. Wealth exists ONLY when the rest believe in the instrument of currency. We are fully complacent. Immobile.

What breaks first?