History remembers Benito Mussolini as a founder member of the original Axis of Evil, the Italian dictator who ruled his country with fear and forged a disastrous alliance with Nazi Germany. But a previously unknown area of Il Duce's CV has come to light: his brief career as a British agent.
Archived documents have revealed that Mussolini got his start in politics in 1917 with the help of a £100 weekly wage from MI5...
Thursday, October 15, 2009
'Recruited by MI5: the name's Mussolini. Benito Mussolini'
Wednesday, October 14, 2009
You Can Run But You Can't Hide
Support Your Global Police?
...Noble himself said that his organization is pursuing a "visionary model," an "alliance of all nations" under a "global police doctrine." This would, in effect, create the first genuinely planetary police force in human history...In an address before justice and law enforcement officials from more than 60 nations who had assembled in Singapore, Noble elaborated on that "visionary model": "In the framework of our partnership with the UN, INTERPOL will provide deployed police peacekeepers with access to the world's only secure global police communications system; global police databases including names of criminals, fingerprints, DNA profiles, stolen passports, and stolen vehicles; and specialized investigative support in key crime areas, including fugitives, drugs, terrorism, trafficking in human beings, and corruption."
Apart from some very serious issues of jurisdiction and sovereignty, the most troubling aspect of INTERPOL's "visionary model" is its potential to help create a UN-directed global panopticon – a "Your Papers, Please" system of world-wide scope...
'The Message of Dollar Disdain'
Unprecedented spending, unending fiscal deficits, unconscionable accumulations of government debt: These are the trends that are shaping America's financial future. And since loose monetary policy and a weak U.S. dollar are part of the mix, apparently, it's no wonder people around the world are searching for an alternative form of money in which to calculate and preserve their own wealth.
It may be too soon to dismiss the dollar as an utterly debauched currency. It still is the most used for international transactions and constitutes over 60% of other countries' official foreign-exchange reserves. But the reputation of our nation's money is being severely compromised....
GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.33000 --- .2450 --- .04
3 month -- .37750 --- .2841 --- .07
6 month -- .51750 --- .5931 --- .15
1 year ----.70000 --- 1.2325--- .33
(as of today)
Best Mortgage Rates
30yr FRM -- 5.00
15yr FRM -- 4.45
5/1yr ARM -- 3.88
(as of 10/02)
Other
10 Year Note -- 3.41
10 Year Muni -- 3.07
10 Year TIPs -- 1.46
10 Year Bund -- 3.23
10 Year AAA --- 3.80
10 Year A ------ 4.95
Tuesday, October 13, 2009
Who's Got The Gold?
Largest Gold Reserves by Country
...The SPDR Gold ETF (GLD) has now grown to such a size that if it were a stand alone country it would now be the 6th largest holder of gold in the world. That's remarkable. Even more remarkable, 1 man - hedge fund manager John Paulson - owns nearly 10% of this gold ETF. [May 16, 2009: John Paulson Continues to Pile into SPDR Gold (GLD)] By the transitive theory this would make John Paulson, if he was a stand alone country, somewhere in the 16- 20th largest holder of gold.
Top 15 $ Value of % of Country Reserves Reserves United States $298.4 N/A Germany $125.0 69.2% International Monetary Fund $118.0 N/A Italy $89.9 66.6% France $89.7 70.6% China $38.7 1.9% Switzerland $38.2 29.1% Japan $28.1 2.3% Netherlands $22.5 59.6% Russia $20.9 4.3% European Central Bank $18.4 18.8% Taiwan $15.5 3.9% Portugal $14.0 90.9% India $13.1 4.0% Venezuela $13.1 36.1%
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GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.31750 --- .2450 --- .02
3 month -- .35250 --- .2844 --- .06
6 month -- .49500 --- .5956 --- .15
1 year ----.67250 --- 1.2394--- .33
(as of today)
Best Mortgage Rates
30yr FRM -- 5.01
15yr FRM -- 4.48
5/1yr ARM -- 3.92
(as of yesterday)
Other
10 Year Note -- 3.35
10 Year Muni -- 2.99
10 Year TIPs -- 1.47
10 Year Bund -- 3.17
10 Year AAA --- 3.75
10 Year A ------ 4.90
Econ Data; Fed & Treasury Info
Monday, October 12, 2009
Iceland Must Have Missed The Memo: (you can't have price inflation w/ slack in the economy and labor market)
Iceland Shrinks 8% as Prices Increase 11% in Deepest Recession
...A year after the banking crisis brought Iceland to the brink of bankruptcy, the island nation is mired in the deepest recession among advanced economies. The stock market has lost 97 percent of its value, and more than 780 companies have buckled under the weight of foreign currency loans as the krona plunged...
...Iceland’s economy will shrink 8.5 percent this year and consumer prices will climb 11.7 percent, both the worst performances among the world’s 33 advanced economies, according to the IMF’s latest forecasts. As the rest of the world begins to recover, Iceland’s recession will stretch into next year, with the economy contracting 2 percent, more than any developed nation except Ireland.Unemployment will rise to 8.6 percent this year, from less than 1 percent in December 2007, the IMF estimates. Iceland will still trail the eurozone average of 9.9 percent and Spain’s 18.2 percent jobless rate, the highest in the developed world.
One of the hardest-hit industries has been construction, where 202 companies filed for bankruptcy in the 11 months after the crash, 67 percent more than in the same period a year earlier, according to data compiled by Statistics Iceland...
Continue...
GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.32400 --- .2444 --- .03
3 month -- .37000 --- .2844 --- .06
6 month -- .48800 --- .6013 --- .15
1 year ----.70400 --- 1.2513--- .34
(as of today)
Best Mortgage Rates
30yr FRM -- 5.01
15yr FRM -- 4.48
5/1yr ARM -- 3.92
(as of 10/02)
Other
10 Year Note -- 3.38
10 Year Muni -- 2.99
10 Year TIPs -- 1.52
10 Year Bund -- 3.18
10 Year AAA --- 3.75
10 Year A ------ 4.90
Econ Data; Fed & Treasury Info
- Columbus Day, markets open
- Monetary Policy Research and the Financial Crisis: Strengths and Shortcomings
- Commercial Paper
- Selected Interest Rates
- Mortgage Debt Outstanding
- Commercial Bank Assets/Liabilities
- Bernanke On Balance Sheet
- Aruoba-Diebold-Scotti Business Conditions Index
- Alternative Measures of Unemployment
- The Effects of "Cash for Clunkers" on the Auto Industry
- Consumer Compliance Outlook
- On the Bubble: When Real Estate's Long Haul Took a Shortcut
- Financial market utilities and the challenge of just-in-time liquidity
- The Chicago Fed National Activity Index and business cycles
- St. Louis Fed’s Bullard Addresses Issues Facing Near-Term Monetary Policy
- National Economic Update
- Regional Economic Update - Dallas Fed
Gold COT (Oct 6)
Gold COT saw an expected jump in O/I of about 30k contracts; Net commercial short jumped while "speculators" took those contracts to the long side, with a large jump in small-trader positions, adding both longs and shorts (more of the former). Again, historically O/I is elevated but the COT structure can support a larger break if the USD and geo-political events remain gold-bullish. Concentrated positions not making a big move...
Thursday, October 8, 2009
Sweet Freedom
Scenes From a Crackdown
...a number of disturbing images, videos, and witness accounts have come out of Pittsburgh, as well as from similar high-stakes political events in recent years, that reveal the disquieting ease with which authorities are willing to crush dissent—and at the very sorts of events where the right to dissent is the entire purpose of protecting free speech. That is, events where influential policymakers meet to make high-level decisions with far-reaching consequences...
...A number of police departments from across the country came to Pittsburgh to help police the summit, and nearly all were dressed in paramilitary garb. In one widely-circulated video from the summit, several police officers dressed entirely in camouflage emerge from an unmarked car, apprehend a young backpack-toting protester, stuff him into the car, and then drive off. It evoked the sort of "disappearance" one might envision in a Latin American junta or Soviet Block country. Matt Drudge linked to the video, describing the officers in it as members of the military. They weren't, though it's certainly easy to understand how someone might make that mistake.
Another video shows a police unit with what seems to be a handcuffed protester. Officers surround the protester and prop him up, at which point another officer snaps what appears to be a trophy photo. (YouTube has since removed the video, citing a terms of use violation.) Other Twitter feeds and uploaded photos and videos claim police fired tear gas canisters into dorm rooms, used sound cannons, and fired bean bags and rubber bullets. One man was arrested for posting the locations of riot police on Twitter...
Fed Balance Sheet (Oct 8)
Total Balance Sheet size continues to plateau as the fed's lending programs contract and their "monetizations" continue to add securities - at a significantly slower pace - to the BS. The program of buying UST/MBS/Agencies is also beginning to wind down. One noticeable development is a large draw-down in the treasury's general account as well as a decrease in the supplemental account causing reserves of depository institutions to balloon to just under $1 Trillion.
'Asian Central Banks Intervene as Dollar Tumbles'
SINGAPORE -- The U.S. dollar continued to tumble against most Asian currencies Thursday, prompting a wave of foreign-exchange intervention by central banks in South Korea, Taiwan, the Philippines and Thailand seeking to limit damage to their export industries.
Traders said the dollar selloff is unlikely to fade soon, given the prospect for a long period of low U.S. interest rates to support a sluggish U.S. economy and increasing signs central banks in Asia will begin tightening monetary policies in the months ahead.
It felt like there was some intervention earlier as the Dec $Index Contract managed (and still manages) to hold above the key 76 level ; whether intervention in "secondary" asian currencies did much, or even anything, to support the $index is debatable though.
Bad 30yr Auction
$12 Bil 30yr auction
BtC of 2.37
4.009 % yield
10yr note futures dumped from 119.20 to 119.14
UPDATE: 10yr note continues lower to 119.07, stock market may have gotten spooked about the auction as it has followed the bond market lower...only in bizarro world can you have stocks and bonds sell off and watch the dollar rally with it
GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.29750 -- .2444 -- .06
3 month -- .35000 -- .2844 -- .09
6 month -- .43750 -- .5975 -- .14
1 year ----.59500 -- 1.2131-- .34
(as of today)
Best Mortgage Rates
30yr FRM -- 4.92
15yr FRM -- 4.41
5/1yr ARM -- 3.85
(as of 10/02)
Other
10 Year Note -- 3.21
10 Year Muni -- 2.76
10 Year TIPs -- 1.43
10 Year Bund -- 3.12
10 Year AAA --- 3.41
10 Year A ------ 4.56
Econ Data; Fed & Treasury Info
Treasury:
- 3mo bill announcement
- 6mo bill announcement
- 16day CMB
- 29yr, 10mo bond auction
- U.S. international reserve position
- Kohn Speaks
- Lacker Speaks
- Tarullo Speaks
- Hoenig Speaks
- Commercial Paper
- Selected Interest Rates
- Balance Sheet
- Base & Reserves
- Monetary Aggregates
Wednesday, October 7, 2009
Iran War Watch
This could be part of the reason gold is running, although you'd think oil would be rising faster than gold if the market smelled an attack coming.
Is The U.S. Preparing to bomb Iran?
Is the U.S. stepping up preparations for a possible attack on Iran's nuclear facilities? The Pentagon is always making plans, but based on a little-noticed funding request recently sent to Congress, the answer to that question appears to be yes...
Continue...
Here's the contract for an attack on Iran by US-Israel by Dec 31 2009:
GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.30167 -- .2444 -- .03
3 month -- .37500 -- .2844 -- .07
6 month -- .46667 -- .6000 -- .14
1 year ----.63833 -- 1.2169-- .33
(as of today)
Best Mortgage Rates
30yr FRM -- 4.95
15yr FRM -- 4.44
5/1yr ARM -- 3.86
(as of 10/02)
Other
10 Year Note -- 3.21
10 Year Muni -- 2.88
10 Year TIPs -- 1.45
10 Year Bund -- 3.13
10 Year AAA --- 3.41
10 Year A ------ 4.56
Tuesday, October 6, 2009
Tin "Trouble"
The mystery investor who is turning the tin market on its head
A single investor – thought to be a hedge fund – is sitting on thousands of tonnes of tin in warehouses across London. According to traders almost the entire stocks of tin on the London Metals Exchange (LME) was bought up by a single, mysterious investor, last week...
Continue...
Personally I have no problem with someone partially cornering a market; if they want to put on that type of risk(the riskiest position there is if a forced liquidation occurs, or otherwise) so be it. If they are distorting the "true" price there is a fundamental price inefficiency that allows small (and big) traders to trade against.
Does the semi-corner not have more power? Of course, but why shouldn't they? Someone buying $1 mil of some stock has more power to influence price than someone buying $100 of it. This is just the nature of a society where people exchange things. The thing that people forget is that to manipulate an asset price you have to commit serious capital at price X and eventually be able to liquidate at > X in the future. You can accumulate all you want, but to profit you must distribute it.
If industrial buyers don't like it, they should buy forward and stop bitching about backwardation, or better manage inventory/hedging.
Furthermore a semi-corner would drive the price up/down drastically during the accumulation process creating an incentive, in the case of tin, for more investment in production (with a significant lag) and more metal finding its way on the market.
People don't have a right to tin, they have a right to bid for it. If you don't like the asking price don't buy it. Simple.
UN calls for new reserve currency
The United Nations called on Tuesday for a new global reserve currency to end dollar supremacy which has allowed the United States the "privilege" of building a huge trade deficit......"Greater use of a truly global reserve currency, such as the IMF's special drawing rights (SDRs), enables the seigniorage gained to be deployed for development purposes,"...
When an article makes so many spelling/grammatical errors it's tough to take it seriously, although it does fit within the overall theme of global monetary trends...
GOFO, Libor, UST & Mortgage Rates
Duration -- GOFO -- LIBOR -- UST
1 month --.25400 -- .2444 -- .03
3 month -- .38200 -- .2841 -- .07
6 month -- .43800 -- .6000 -- .15
1 year ----.60600 -- 1.2125-- .35
(as of today)
Best Mortgage Rates
30yr FRM -- 4.91
15yr FRM -- 4.42
5/1yr ARM -- 3.84
(as of 10/02)
Other
10 Year Note -- 3.24
10 Year Muni -- 2.90
10 Year TIPs -- 1.48
10 Year Bund -- 3.15
10 Year AAA --- 3.44
10 Year A ------ 4.58
Econ Data; Fed & Treasury Info
Treasury:
- 4wk bill auction
- 3yr note auction
- STRIPs
- Geithner Statement to Plenary Session of World Bank-IMF Meetings
- Thomas Hoenig Speaks (9:45 pm)
- Federal Reserve announces changes to procedures for evaluating asset-backed securities pledged to the Term Asset-Backed Securities Loan Facility (TALF)
- $50 Bil in 70-day Term Auction Credit to be auctioned
- Commercial Paper
- Selected Interest Rates
- William C. Dudley - A Bit Better, But Very Far From Best
- Changes to TALF
- National Economic Indicators (Richmond Fed)
- Real GDP: Second Quarter Final Estimate
- The Availability and Profitability of Credit Cards
- Housing's Great Fall: Putting Household Balance Sheets Back Together Again
- International Economic Update
- Disagreement About Inflation Outlook
Monday, October 5, 2009
Step-By-Step The USD Moves Closer To The Abyss
The demise of the dollarIn the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.
Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.
The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years...
...But the significance of this development goes much further. Since the end of the Second World War the dollar has been the bedrock of world trade. The pre-eminence of the American currency flowed naturally from the economic dominance of the US. Virtually everyone traded with America so it made sense to use their currency.
But the US is not the dominant power that it once was. The financial crisis has left it hobbled with significant government and household debts and sharply reduced prospects for growth. Developing nations such as China, Brazil and India, on the other hand, have weathered the economic storm significantly better. So while this latest proposal is born of financial calculation, it is also a reflection of a new economic world order...
Continue...
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