Risk On Rally Fails As World Banks Dump Off Most Of Their EU-Summit Gains As The Euro Tumbles To A New Low And Italian And Spanish Bond Spreads Return To Pre Summit Crisis Level

Financial Market Report for the week ending Friday July 6, 2012; this is the fourteenth week of entry into the Second Great Depression.

1) … Stocks traded lower Friday of this week.

The ETRACS Fisher-Gartman Risk On ETN, tthe “Risk On ETN ONN, traded lower on Friday, reflecting a sale of Risk On Assets. Stock ETFs such as SEA, IPU, PSP, PXR, CHXX, INXX, BRXX, WOOD, KOL, URA, XME, IEZ, OIH, PSCE, AMJ, XOP, CNDA, CHIQ, and PAGG, stalled their rally and traded lower, as the world banks, IXG, led by the Deutsche Bank, DB, and the European Financials, EUFN, dumped off most of their EU-Summit gains as the Euro, FXE, and the Swiss Franc, FXF, plummeted to a new low, and the US Dollar, $USD, rose 2.0% and UUP rose near its recent high.

When Credit died in April 2012, there was a safe haven flight of capital out of India Infrastructure stocks, INXX, and into US Infrastructures Stocks, PKB, as is seen in the chart of PKB:INXX.  Anoop Agrawal  of Bloomberg reports: “Credit risk for India’s financial institutions is climbing toward a three-year high after the central bank warned that cash shortages and rising bad loans threaten lenders in Asia’s third-largest economy.” And Anoop Agrawal and Kartik Goyal of Bloomberg report: “India is likely to face elevated inflation risks from supply bottlenecks and lingering threats to economic expansion, the Reserve Bank of India said. ‘Threats to stability are posed by the global sovereign debt problem and risk aversion, domestic fiscal position, widening current-account deficit and structural aspects of food inflation,’ the central bank said in its Financial Stability Report released in Mumbai today. While India’s financial system “remains robust,” challenges to stability have increased since the last assessment in December 2011.” Popular stocks have included USG, APOG, SHW, EXP, LPX, MON, MYE, AVD, MRC, FISV, TSS, FIS, LIOX, INWK, PRAA, LNN, NC, WPP, ACIW,

Software, IGV, Cloud Computing, SKYY, Networking, IGN, and Semiconductors, XSD, and the Nasdaq 100, QTEC, led Mid Cap Growth, JHK, Russell 2000, IWO, shares lower. Copper Miners, COPX, Silver Miners, SIL, Gold Miners GDX, GDXJ, traded lower. Truck Manufacturer, Navistar, NAV, fell 15% today. Software selling off included WMW, CTXS, RHT, TIBX, ADSK.

Silver, SLV, Gold, GLD, Oil, USO, Timber, CUT, and Base Metals, DBB, led Commodities, DBC, lower. Bespoke Investment Group writes Gold Can’t Catch a Break.  I comment that the reason gold is unable to break out is that US Treasuries, TLT, EDV, ZROZ, are rising, causing the US Dollar, $USD, UUP, to rise; and currencies, such as the South African Rand, SZR, and the Australian Dollar, FXA, to trade lower, on falling Commodity, DBC, prices. An investment demand for gold will return shortly before Financial Armageddon, that is a credit collapse and global financial breakdown, as the chart of the gold ETF, GLD, shows that it is near the edge and edge a descending triangle. Gold is both a commodity and a currency and its value traded lower from its recent high in March 2012 when credit died. The weekly chart of gold shows that it is in the middle of a Elliott Wave 3 up.      

Zero Hedge relates Crude, USO, spiked on news iran lawmakers propose Straits of Hormuz blockade for sanctions countries.

Agricultural commodities, RJA, JJA, soared as heat wave threatens the US grain, GRU, harvest; Wheat, WEAT, and Soybeans, SOYB, continued their upsurge; Corn, CORN, blasted higher. Natural Gas, UNG, rise to strong resistance and manifested bearish engulfing. Agriculture shares, MOO, and PAGG rose higher.

Municipal bonds weekly, MUB, traded lower this week and lower on the month. The chart of Municipal bonds monthly, MUB, shows they entered and Elliott Wave 3 down in June 2012, after having turned lower in March 2012, with the death of credit in March 2012, when the world passed through peak credit as world stocks, VT,  turned lower. The death of credit in March 2012 is seen in the Bespoke chart article S&P 500 Cumulative Breath Declines

The rise in Total Bonds, BND, to a new monthly high is simply attributable to a continuing demand for US Debt as a safe haven investment. Mortgage backed bonds, MBB, rose, causing Mortgage REITS, REM, such as Annaly Capital Management, NLY, to rise. Freddie Mac 30-year fixed mortgage rates declined 4 bps to a record low 3.62%.  Emerging Market Bonds, EMB, rose to a new high.  But world government bonds, BWX, traded lower. The highly margined BOND ETF, BOND, traded higher  The Zeroes, ZROZ, traded higher, as the 10 30 US Sovereign Debt Yield Curve, $TNX:$TYX, flattened, as reflected in the Flattner ETF, FLAT, rising. A flattening yield curve suggests a recession is coming. US Infrastructure Stocks, PKB, have been a limited safe haven investment as well, rising higher on a higher dollar. US Homebuilders ITB, Biotechnology, XBI, Pharmaceuticals, IHE, Dow Telecom IYZ, and US Preferreds, PFF, rose to new highs.

An inquiring mind asks are credit providers, MA, V, DFS, NNI, RCII, GCA NICK, COF, ARCC, ADS, WRLD, CATM, seen in this Finviz Screener topped out?

And an inquiring mind asks have retailers, VSI, ROST, TJX, PETM, and SSI, topped out.

And have telecom providers, PTGI, GNCMA, EQIX, SBAC, EQUI, topped out?

And have rental services URI, ELRC, AAN topped out as well?

Semiconductor Manufacturer, MLNX, has definitely topped out after having manifested a cup and handle pattern with three white soldiers and a lollipop hanging man candlestick chart pattern.

2) …. In this week’s news

Mark Grant of Out of the Box relates in Zero Hedge Seven out of the seventeen economies that belong to the European Union that need to be bailed out. This is 41% of the Euro-17 that is in trouble. The second indication of decline is the recessions in Europe. In fact virtually all of Europe is in a recession and while Germany has held its head above the water I think by the third or fourth quarter that she is also mired in an economic decline. Europe is 25% of the global economy and this is beginning to affect the United States as exemplified by the declining revenues and profits of many American corporations that have so far reported out this quarter. The axes of the financial markets are America, Europe and China and with Europe in serious decline and China also contracting the strings are vibrating so that all of the markets are likely to go down. Even without some cataclysmic shock, realization is coming. The debts of Europe are being paid off with ever more debt and the can kicking will find its walls and as the European recession deepens it will be felt in America and then adjustments will have to be made – as fact overbears fantasy.

Daily Mail UK’s borders ‘will be closed’ to refugees if eurozone collapses

Financial Sense When zero rates don’t work

Reuters reports How Stockton went broke: A 15-year spending binge

CNN Money Explaining the Libor interest rate mess

Euro Intelligence provides the best in news and analysis and in its for fee daily email Welcome Back To The Crisis relates After a disappointed reaction to the ECB’s rate cut to 0.75%, Italian and Spanish spreads have returned to the crisis levels that prevailed before the summit; The euro fell below $1.24, and Germany 10-year yields to below 1.4%. A group of pro-European German economists are launching a counter-appeal to Hans-Werner Sinn’s anti-banking union movement. Angela Merkel’s popularity rating in Germany has reached the highest in three years. The Greek finance ministry find it impossible to collect tax fines to due understaffing and outdated system. Fabrizio Goria says the ECB reached the end of the line. Merkel and Hollande want to create the post of a Super Mr. Euro, Le Figaro writes (And MIke Mish Shedlock writes Hollande and Merkel Want a “Super Mr. Euro” Position; I Nominate Max Keiser For The Job

In a direct response to the public appeal by Ifo president Hans-Werner Sinn and 170 other economists for a citizen’s revolt against last week’s summit results and the plans for banking union, a group of pro European economists is about to launch a public campaign in favour of Angela Merkel’s euro rescue policy, Spiegel Online reports. Sinn’s appeal “damaged the reputation of German economic science”, Peter Bofinger said of he is one the five so called economic wise men. The director of the Institute for Economics, a research organization close to the employer’s federation, said the appeal was “irresponsible” because it “did not have anything to do with economic arguments”. Meanwhile Bofinger and Gustav Horn, a left wing economist close the German unions prepare a public appeal in response to Sinn and in support of Merkel’s euro policy. The chancellor also reacted to Sinn’s criticism by saying the summit results increased common control and not common liabilities. Meanwhile, 54% of the Germans feel that the different euro rescue efforts do not make any sense, a poll for Spiegel Online showed.

Angela Merkel’s popularity among voters is at its highest level in three years, according to a poll published on Thursday that also confirmed strong support for her stance in the euro zone debt crisis, Reuters reports. But the Infratest-ARD survey suggested Merkel’s FDP coalition partner would fail to get elected to Bundestag after next year’s election, complicating her hopes of securing a third term. The poll, conducted after an EU summit widely seen by German media as a setback for Merkel’s tough euro zone policies, showed 66% of Germans were satisfied with her performance, an increase of eight percentage points from a month before and the highest reading since 2009 when she won a second term. Her nearest rival, Frank-Walter Steinmeier, parliamentary leader of the SPD, had an approval rating of 61%. He was level pegging with Wolfgang Schäuble. Some 58% of Germans believe Merkel’s stance in the euro crisis is correct and decisive, although 85% of those polled also expect the crisis to get worse.

Writing in Linkiesta, Fabrizio Goria says one of the reasons for the disappointment is that the ECB reached the end of the line. With the deposit rate now at 0%, and two LTROs, the inter-banking market remains frozen. He quoted ICAP as saying that the ECB is working overtime to keep the banks afloat, just as they did between August and December 2011. And he said hedge funds may yet test the most recent decision by the European Council, and that this may lead to even higher yields. He said confidence in Italy in particular might falter upon a disappointing reaction to the spending review, which the Monti government is currently considering. He says Italy is unlikely to accept the European Commission’s recommendations to eliminate the provinces as a fiscal entity, and that the confidence Rome has benefitted from in the last few weeks may well vanish quickly.

According to Le Figaro Angela Merkel and Francois Hollande agree to upgrade the eurogroup chairman post to a “Super Mr. Euro” who would be eye to eye with Mario Draghi and Christine Lagarde. The post should be more visible than it has been since the current holder Jean-Claude Juncker took it over in 2005. The aim would be to have someone who would represent the eurozone politically at international meetings like the G20. The chancellor will talk with the president about the idea this Sunday when both will meet in Reims. According to the paper, which says it drew on high ranking German and French sources, both would want Juncker to continue on an interim basis until the end of the year when Herman Van Rompuy will present the detailed proposals how to strengthen EMU. There appears to no agreement yet about who should be this “Super Mr. Euro” afterwards. According to Le Figaro Wolfgang Schäuble still is interested while the French also consider that a Frenchman should occupy one of the high profile euro posts.

Another setback on the tax collection front in Greece.  As Kathimerini reports, the finance Ministry has been unable to collect court-ordered tax fines of €12.6bn, 6.2% of GDP, according to data posted on ministry’s website. This is due partly to understaffing, the voluntary exit programme, and early retirement schemes for civil servants, as an absence of electronic procedures. They only managed to collect €630m. In addition, there are 180,000 outstanding tax cases in the Greek courts with no sign that this number will shrink significantly any time soon. As a result, the paper write,  it is hardly surprising that net revenues are showing a 1.5% decline from the same period in 2011.

Open Europe reports 160 German economists issue public appeal against eurozone banking union;  Citi: Taxpayers and MPs “misled” over extent to which ESM loans are senior to other claims.  160 German economists, including the head of the IFO institute, Hans-Werner Sinn, have today published an open letter to their fellow citizens criticising the decisions taken at last week’s EU summit, warning that “we view with great concern the step towards a banking union, which will result in the collective guarantee of the debts of the banks in the eurosystem. These debts are almost three times as large as the government debt and in the five crisis-affected countries they lie within the range of several trillion euros… Banks must be allowed to fail. If the debtors cannot pay, there is only one group who can and should bear the burden: the creditors themselves.”

In an interview with Der Spiegel, the SPD’s budgetary expert Carsten Schneider warns that, without strict conditions, Angela Merkel cannot count on his party’s support in the Bundestag for approving direct support to Spanish banks via the eurozone’s bailout funds. In the last four votes on the eurozone rescue, Merkel failed to gain a so-called ‘Chancellor’s majority’, i.e. an absolute majority based only on MPs from her own coalition.

Deutsche Wirtschafts Nachrichten reports that an internal Citigroup evaluation of the eurozone’s new permanent bailout fund, the ESM, suggests that taxpayers and parliamentarians have been misled over the level of seniority which ESM loans enjoy. This is because the clauses suggesting that ESM loans would be senior, and therefore likely to avoid losses under a debt restructuring, are only ‘noted’ and are not actually legally enforceable. This interpretation of the treaty was also confirmed by UK lawyers consulted by the newspaper. However, the article does note that this type of seniority is also held by the IMF and other supranational institutions.
Spiegel Handelsblatt Welt FAZ FAZ: Economists’ Letter Spiegel 2 Spiegel: Schneider DWN

Open Europe reports Spanish government set for showdown with regions over new budget cuts; Le Figaro: Hollande and Merkel want to create new “Super Mr Euro”.

According to sources quoted by Reuters, the Spanish government is finalising a new austerity package worth up to €30bn to make sure that Spain meets EU-mandated deficit reduction targets. The package would run over several years, and some measures may be announced as early as next week. However, El País notes that many Spanish regions have said they have no margin for further budget cuts this year. In an auction this morning, Spain had to pay a 6.43% interest rate on its ten-year bonds – the highest since last November. Meanwhile, Spain’s former finance minister and IMF director Rodrigo Rato is to face trial for alleged fraud following the collapse of Bankia.

Le Figaro reports that France and Germany want to increase the powers of the eurozone President from next year and create a new “Super Mr Euro”. German government spokesman Steffen Seibert told Bloomberg the report was “fabricated”.

Separately, during his joint press conference with German Chancellor Angela Merkel yesterday, Italian Prime Minister Mario Monti said that Italy’s public deficit will be 2% of GDP at the end of the year – well above the previous estimate of 1.3%. The Italian government is due to adopt plans to cut public spending tomorrow.
Bloomberg Reuters El País El País 2 Cinco Días FT CityAM WSJ Telegraph WSJ 2 Dow Jones Le Figaro 3 FT 2 FT 3 FT: Editorial Telegraph 2 IHT Le Figaro Il Sole 24 Ore Il Sole 24 Ore 2 Irish Times Telegraph RTE

Open Europe reports Bundesbank President criticises constant mutualising of risks and weakening of agreed rules; Row over letter by German economists warning against banking union grows.

Yesterday’s open letter warning against setting up a eurozone banking union, now signed by 172 German economists, received partial backing from Bundesbank President Jens Weidmann reports FAZ. Weidmann argued that “This is not some short-term instrument that will solve the existing problems but an ambitious project whose complexity matches that of the monetary union and the common monetary policy”. He also criticised the government over the decisions taken at last week’s EU summit, warning that the eurozone was “constantly mutualising risks and weakening the agreed rules”, adding that “Fiscal aid should be the last resort of crisis management [but] this position has by now been recognisably weakened.”

The German political establishment has reacted angrily to the letter, with German Finance Minister Wolfgang Schäuble claiming it was “outrageous” that the economists were “confusing the public”. The letter was also criticised by the FDP, while the opposition SPD’s budgetary expert Carsten Schneider described it as “hysterical”. Chancellor Angela Merkel denied that Germany would be taking on any additional liabilities, claiming that “Liabilities for banks are banned under the current rules just like liabilities for state debts”.

According to a new Infratest Dimap poll for German public broadcaster ARD and Die Welt, 60% of Germans are satisfied with Merkel’s handling of the eurozone crisis. Open Europe’s blog post looking at the economists’ letter was cited by National Review Online.
FT Handelsblatt FAZ Süddeutsche Handelsblatt 2 Süddeutsche 2 Welt La Tribune National Review Online

Bloomberg reports on the death of European Socialism. Spain Rescue Seen Worse Than Cure as Hospitals Make Cuts. Patients and hospitals across Spain are wrestling with the same dilemma. Even as old debts get paid off — the country’s 17 regions ran up some 12 billion euros in unpaid health bills through last year — new ones are piling up. As a result, the need to break the cycle with spending cuts threatens to redefine the very notion of Europe’s tradition of socialized medicine: how best to treat patients, not how to make ends meet. “As long as it is state-funded, the health system will always run a deficit,” said Miguel Llorens, financial director for Hospital Provincial de Castellon (Hat Tip to Gary of Between The Hedges)

Bloomberg reports Made-in-London Scandals Risk City’s Reputation as Finance Center. London risks losing its status as the world’s top financial center as the $360 trillion interest-rate fixing probe follows a series of market abuses by banks that eroded trust in a city already shrinking faster than rivals. JPMorgan Chase & Co. (JPM)’s trading loss of at least $2 billion, the alleged $2.3 billion fraud at UBS AG (UBSN) and the investigation of at least a dozen banks including Barclays Plc (BARC) for rigging global interest rates all happened in London in the last year. The effect is taking a toll on the capital of a country enduring its first double-dip recession since the 1970s, which fired more financial-services workers than any other country in 2011 and again this year. (Hat Tip to Gary of Between The Hedges)

Bloomberg reports Barclays Corrupts Libor and Maybe a Lot More. If Barclays Plc (BARC) would lie about its borrowing costs, what else would it lie about? That question gets to the heart of the damage Barclays did to itself by submitting false numbers for years to the British Bankers’ Association as part of the surveys used to set the London interbank offered rate, the benchmark for $360 trillion of financial instruments globally. The most important asset any bank has is trust — especially when it comes to the figures on its own financial statements. Whatever credibility Barclays had, it’s been poured down the drain like last night’s suds. (Hat Tip to Gary of Between The Hedges)

The WSJ reports Rate Scandal Set to Spread. Former Barclays CEO Lambasted in Parliament as Other Banks Brace for Fallout. A day after abruptly resigning amid a mushrooming scandal over interest-rate manipulation, former Barclays PLC chief Robert Diamond on Wednesday was assailed by British lawmakers for the bank’s actions, in a preview of the scrutiny likely to lie ahead for other big lenders that are under investigation. Barclays last week agreed to pay $453 million to settle U.S. and British authorities’ allegations that the British bank tried to manipulate the London interbank offered rate, or Libor, which is the benchmark for interest rates on trillions of dollars of loans to individuals and businesses around the world. (Hat Tip to Gary of Between The Hedges)

CNBC reports China’s Fleet of ‘Ghost’ Ships Signals Worsening Slowdown. China’s huge fleet of coastal ships, usually confined to plying the Chinese seaboard, has sailed out of the shadows to seek international business in yet another sign that China’s economy is slowing. The fleet, previously unnoticed by the global market, is suffering from a slowdown in China’s coastal trade amid weaker domestic demand from utilities and steel mills and a growing glut in Chinese coal and iron ore stockpiles. The vessels are now being forced to seek new business such as in the Indonesian coal trade, dealing a further blow to the depressed global dry bulk shipping market. “There are many more ships lying idle at Chinese ports now – the environment for making money is not so good,” said a source at one of the big five coastal shippers, who asked not to be identified (Hat Tip to Gary of Between The Hedges)  (Hat Tip to Gary of Between The Hedges)

Nature economist Elaine Meinel Supkis writes in Culture of Life News writes Huge Anti-nuclear Demonstration In Tokyo Shut Down By Noda. Facing reality is hard.  The confusion of modern technology, a population crisis coupled with a financial disaster created by too much credit, WWII becoming the Cold War morphing into many religious wars coupled with the CO2 crisis, the nuclear messes and the overall sense of ‘End of Times’ means we are in a crisis, of course.

This feeling of doom is strong.  And growing.  England and Southeast Asia has been having floods while the US is hot and dry.  Normally, when the weather goes to an extreme (and it does this regularly like a pendulum for at least the last 2.5 million years) people become scared for good reason

The government of Japan has deliberately scheduled athletic events in highly radioactive districts.  Recently, they had a marathon race there for young women, the very last people that should be breathing in the radioactive dust while running hard.  Now it is soccer girls in peril:  #Radioactive Japan: Canada-Japan Women’s Soccer Friendly Match to be Held in Fukushima City | EXSKF.

Sucking down air while breathing very deeply and hard is very dangerous:  20,201 Bq/Kg from vacuum cleaner in Chiba | Fukushima Diary.  The government isn’t measuring this dust, private groups are doing this.  The nature of humans is to ignore reality when it suits us so governments are very good at doing this.

1,000 US High School Students to Do Volunteer Cleanup, Tree-Planting in #Fukushima, Miyagi, Iwate, Ibaraki and Observe Japan’s Recovery | EXSKF is another attempt by the Japanese ruling elites to trick eager US kids to come to Japan and be Chernobyl guinea pigs.  I remember when the US government lied nonstop about nuclear dangers of bomb testing.

They would go out of their way to deliberately expose CHILDREN to this noxious stuff to prove it didn’t kill.  Young soldiers were repeatedly exposed to high levels of nuclear pollution by being force marched into dusty deserts that were nuked minutes earlier!  Since no one died instantly, the government claimed there was no danger.

This is a blatant lie and worse, government scientists knew this and went to greater and greater lengths to prevent their own children from being exposed to this dangerous dust.  This cultural exchange is being enabled by our own government because they want to expand nuclear power plants here, too, and are most anxious to make things look ‘normal’.

So the poor students, blissfully unaware of the life-long negative outcomes they are being exposed to, will travel there to have an exciting time visiting the Japanese culture and talking about anime and gaming with young Japanese kids who are being kept inside all the time to avoid the things these US students will be exposed to.

Note that the US guinea pigs will be asked to DIG holes and plant and WATER trees!  So they will have maximum exposure.  Then the nuclear power pushers in the US and Japan will grandly announce that all is well and anyone complaining about high radiation are stupid.  If these poor students undergo a lifetime of cancer treatments due to this won’t make the news and will happen ten or twenty years from now.

Japan’s government is determined to resume nuclear energy production.  The anti-nuclear demonstrations are growing bigger each week so these are now being forcibly suppressed as rightwingers work hard to take over the system on behalf of the rich.  The government is tricking athletes to perform in high radiation areas as a scheme to normalize radiation effects which are long term.  Also, the income of the Japanese masses has fallen to 1988 levels and is dropping.

Everything in Japan is getting much worse.  The loss of the right to petition this very stagnant government is being curbed while the media has decided to ignore this fact.  I looked all over the media for news about the biggest anti-nuclear demonstration yet and saw very little online.

There are many excellent pictures here:[Live] Organizer stopped protest, police shut down the exists of subway. | Fukushima Diary and here:  [Live] Police blocked official residence | Fukushima Diary.  The picture I posted above is from Fukushima Diary and this massive demonstration happened in the rain.

It is most unusual to have huge demonstrations at night, in the rain.  So this shows the clear determination of the demonstrators to make their voices heard.  Alas, the world’s media has chosen to ignore them and so this is as if nothing has happened.  Media blackouts are a common tool used collectively by the elites, many of whom are Bilderberg conspirators, to hide the truth.

Facing reality is hard.  The confusion of modern technology, a population crisis coupled with a financial disaster created by too much credit, WWII becoming the Cold War morphing into many religious wars coupled with the CO2 crisis, the nuclear messes and the overall sense of ‘End of Times’ means we are in a crisis, of course.

This feeling of doom is strong.  And growing.  England and Southeast Asia has been having floods while the US is hot and dry.  Normally, when the weather goes to an extreme (and it does this regularly like a pendulum for at least the last 2.5 million years) people become scared for good reason.

Nothing is a happy steady state and in particular, human numbers are not steady.  Despite dropping in Japan, it is increasing at a very high pace in say, India and certainly much of Africa.

The government of Japan has deliberately scheduled athletic events in highly radioactive districts.  Recently, they had a marathon race there for young women, the very last people that should be breathing in the radioactive dust while running hard.  Now it is soccer girls in peril:  #Radioactive Japan: Canada-Japan Women’s Soccer Friendly Match to be Held in Fukushima City | EXSKF.

Sucking down air while breathing very deeply and hard is very dangerous:  20,201 Bq/Kg from vacuum cleaner in Chiba | Fukushima Diary.  The government isn’t measuring this dust, private groups are doing this.  The nature of humans is to ignore reality when it suits us so governments are very good at doing this.

1,000 US High School Students to Do Volunteer Cleanup, Tree-Planting in #Fukushima, Miyagi, Iwate, Ibaraki and Observe Japan’s Recovery | EXSKF is another attempt by the Japanese ruling elites to trick eager US kids to come to Japan and be Chernobyl guinea pigs.  I remember when the US government lied nonstop about nuclear dangers of bomb testing.

They would go out of their way to deliberately expose CHILDREN to this noxious stuff to prove it didn’t kill.  Young soldiers were repeatedly exposed to high levels of nuclear pollution by being force marched into dusty deserts that were nuked minutes earlier!  Since no one died instantly, the government claimed there was no danger.

This is a blatant lie and worse, government scientists knew this and went to greater and greater lengths to prevent their own children from being exposed to this dangerous dust.  This cultural exchange is being enabled by our own government because they want to expand nuclear power plants here, too, and are most anxious to make things look ‘normal’.

So the poor students, blissfully unaware of the life-long negative outcomes they are being exposed to, will travel there to have an exciting time visiting the Japanese culture and talking about anime and gaming with young Japanese kids who are being kept inside all the time to avoid the things these US students will be exposed to.

Note that the US guinea pigs will be asked to DIG holes and plant and WATER trees!  So they will have maximum exposure.  Then the nuclear power pushers in the US and Japan will grandly announce that all is well and anyone complaining about high radiation are stupid.  If these poor students undergo a lifetime of cancer treatments due to this won’t make the news and will happen ten or twenty years from now.

So what, if they all die before age 65?  No one is going to be keeping records of them or the children of Fukushima province.  They will be ignored by the elites.

Average income of Japan households in 2010 down to 1988 level)  The figure represents a drop of 1,262,000 yen from the record 6,642,000 yen marked in 1994…The report also said an all-time high of 61.5 percent of households replied that they were struggling to make a living.

This is a depression for the Japanese people.  It has lasted nearly 20 years.  It has no end in sight at all.  The ZIRP solution imposed after 1994 has been a failure.  Jobs are leaving Japan faster than they are being created.  During the entire crisis, the Japanese rich have gotten richer and the poor are dying off.

CNS News reports 8,733,461: workers on federal ‘disability’ exceed population of New York City

RT writes Eurozone exit: $390,000 prize for winning escape plan

Doug Noland writes of The paradigm shift from credit expansion to credit contraction  I continue to fear that the confluence of complacency, policy impotence, and endemic global market speculative excess creates unappreciated systemic fragilities.

Extraordinarily divergent macro views have solidified.  Some see the makings for a new secular bull market.  I instead see an increasingly susceptible global Credit Bubble and attendant historic financial mania.  A critical facet of this thesis remains that policymakers will go to incredible lengths to sustain Credit, financial and economic booms.  And while this guarantees difficulty in assessing the timing of when catastrophe might strike – it seemingly ensures such an outcome.  With unsettled markets only adding to confusion, I thought it appropriate this week to touch upon Credit theory to try to bring a little clarity to the muddled macro backdrop – Trying to Stay Focused on the Big Picture.

During the halcyon upside of the Credit cycle, ever increasing quantities of Credit disburse purchasing power throughout financial and economic systems.  The Credit-induced increase in spending supports income growth, consumption, corporate profits, investment, government receipts/expenditures and economic output.  Asset inflation is seen as fundamentally driven and, furthermore, as confirmation of the bullish viewpoint.  One can say that Credit growth is self-reinforcing – or “recursive.”  Importantly, the upside of Credit booms ensures seemingly positive “fundamentals” that validate the system’s financial asset price structures and, more generally, the expansive Credit and financial infrastructure.

The Credit boom ensures notions of economic “miracles,” “New Eras,” and “New Paradigms.”  Policymakers are generally seen as astute; economic doctrine as advanced and enlightened.  The inflationary bias associated with the Credit cycle’s upside provides policymakers great flexibility – and seemingly ensures policy effectiveness.  And especially after a few episodes where policy responses free the system from the jaws of crisis, players throughout the markets and economy (not to mention the general public) come to believe in the capacity of policymakers to avoid trouble and sustain the boom.  The social mood is one of general optimism, cooperation and cohesion.  The pie is perceived to be getting bigger, and most are for the most part satisfied that they’re enjoying their fair share.  And, of course, “bull markets create genius.”

The unavoidable may be avoided for years, yet the brutality of a Credit cycle’s downside in the end will be commensurate with the duration and scope of boom-time excesses.  And the changed Credit environment changes so many things.  The maladjusted economic structure will eventually give way, ushering in a cycle of deteriorating fundamentals – including stagnant household incomes, faltering profits and deteriorating government finances.  The pie will not only be shrinking, but most will come to see a fortunate few unfairly taking an ever increasing share to the detriment of everyone else.  The system will be viewed as inequitable, unjust and flat out broken.  The social mood turns sour, as most incomes stagnate (or worse) and perceived financial wealth withers.  Faith in institutions will wane.  Post-Bubble policymakers will invariably be viewed as inept.  Optimism is supplanted by pessimism.  As always, wrenching bear markets create disdain and hostility.

Credit’s downside, along with accompanying bear markets, over time instills wreaking ball havoc upon the Credit structure.  In the final analysis, Credit is everything and always about confidence.  During the Credit expansion, constructive fundamentals and general optimism bolster the perception that Credit is sound and that most Credit instruments will be vehicles of wealth generation.  As a Credit bust ensues and the economic and asset price backdrop deteriorates, ever-increasing swaths of Credit instruments are viewed as impaired or even dubious.  The entire Credit and financial structure, having grown to incredible stature during the boom, turns brittle and unstable – with trouble generally starting out on the “periphery” before eventually rotting away at the “core.”

Grant Williams in Zero  Hedge writes More on the LIBOR Scandal and explains why it would be impossible for Barclay’s to rig the LIBOR rate on its own. The idea is that top British banks conspired together to “rig” the price of LIBOR. But the entire financial industry is rigged from beginning to end, starting with the price and volume of money. Central banking is the predominant theme of the monetary world – of the global economy, actually. All around the world, small groups of men under the supervision of the BIS meet regularly to determine (or “fix”) the price and volume of money. Yet we are to believe that the paltry price shaving performed by LIBOR banks is an expression of ultimate criminality while central bank price-fixing on a day-to-day and sometimes hour-to-hour basis is beneficial?

Christopher Mardsen writes in WSWS Allegations of government collusion in Libor fixing raised in UK Parliament The declaration by chairman Andrew Tyrie that some of what Barclays chief executive Bob Diamond said in testimony to the parliamentary Treasury Committee seemed “implausible” ranks as a masterpiece of understatement.

Holman W Jenkins Jr, writes in WSJ, Lies, damn lies and LIBOR. Call it one more improvisation in ‘too big to fail’ crisis management. Libor was flawed by the assumption that the banks setting it would always be seen as top-drawer credit risks. The Basel capital-adequacy rules were flawed because they incentivized banks to overproduce “safe” assets, like Greek bonds and U.S. mortgages. The ratings process was flawed eight ways from Sunday, including the fact that many fiduciaries, under law, were required to invest in securities blessed by the rating agencies.

Some Barclays emails imply that traders, even before the crisis, sought to influence the bank’s Libor submissions for profit-seeking reasons. This is puzzling and may amount to empty chest thumping. Barclays’s “submitters” wouldn’t seem in a position to move Libor in ways of great use to traders. Sixteen banks are polled to set Libor and any outlying results are thrown out. Plus each bank’s name and submission are published daily. But let’s ask: Instead of trying to manipulate Libor in a crisis, what would have been a more straightforward way of dealing with its exposed flaws, considering the many trillions in outstanding credit tied to Libor?

The answer is obvious: The Bank of England might have stepped forward with a statement: “All banks are potentially insolvent. Therefore, Libor is no longer an effective proxy for credit availability to top-notch borrowers. Therefore the government is instituting price controls over Libor and the benchmark will be set by administrative fiat until further notice.”

This would have been an aboveboard solution. It would also have drawn back the curtain on the wizard in a way perhaps not helpful to central-bank efforts to contain an incipient financial panic. In a budding panic, the wizard act of monetary authorities is all we’ve got. You haven’t understood the Libor scandal until you understand this part too.

Tyler Durden writes in Zero Hedge The sole driver of risk in the past 3 years has been nothing but continued pumping of liquidity into markets by central banks: aka the Global Central Bank Put. How does this look visually? The below summary charts showing global balance sheet expansions should blow everyone’s minds.

3) …Bible prophecy is the only correct lens through which to view economics and politics

There are many austrian economics authors who have written critically of Neoliberal finance and the Neoliberal regime, that is the Milton Friedman, Free To Choose, floating regime, also known as the Banker Regime. For example, Mario Rizzo is an economic professor at the New York University writes on Ethics and Economics, Law and Economics, Psychology and Economics, Foundations of Economic Theory, Moral and Economic Paternalism, and Classical Liberalism.

Professor Rizzo has edited what is now an extensive series of Austrian Economics books called “The Foundations of the Market Economy” published by Routledge in London and New York. He is also a series editor of the research annual, Advances in Austrian Economics, as well as a co editor of a series, “The Political Economy of the Austrian School”, published by NYU Press.

He authored Economic Policy Journal article Richard Posner Turns Keynesian where he relates … “as an author of The Economics of Time and Ignorance, I am fully on board about incorporating some of the valuable insights Keynes had in my own largely Austrian perspective. I have even blogged in Think Markets about the similarities between Keynes’s view of the method of economics and that of Hayek. They both were strong proponents of “subjectivism” and opponents of excessive formalization. On the other hand, I can understand the dismissive attitude toward Keynes exhibited by Ludwig von Mises. Mises thought that Keynes was an enemy of the economic way of thinking. He entitled a critique of Keynesianism, “Stones into Bread: The Keynesian Miracle.”…”.

I relate that since the early 1950s and especially in 1971 with the abandonment of the gold standard by Nixon to engage in the Vietnam war and greatly expand US hegemony globally, neoliberalism has seen a throwing off of rational choice to engage in a global debt trade which has stimulated inflationism and caused crony capitalism and European Socialism to rise as the dominant economic and political paradigms.

According to the dispensation of the fullness of times, or what Witness Lee calls, The Economy of God, paperback available from Amazon, seen in Ephesians 1:10, the Sovereign God, Ephesians 1:14-21, is acting to replace Neoliberalism with Neoauthoritarianism, as seen in the rise of the Beast Regime of Revelation 13:1-4, which is also regional known as global governance as foretold in Daniel 2:30-33, as the new dominant economic and political paradigm. This ten toed kingdom, will be comprised of the iron of diktat and the clay of democracy, and being unsustainable, will collapse; out of which mankind’s final kingdom — a one world government will arise.

Neoauthoritarianism, after the soon coming Financial Armageddon, seen in Revelation 13:3-4, will see a shackling on of debt servitude, beginning in the Eurozone, as the First Horseman of The Apocalypse, Revelation 6:1-2, transfers the baton of sovereignty from sovereign nation states, to sovereign leaders and sovereign bodies such as the ECB.

Future EU Leader’s framework agreements will serve as the constitution for the New Europe, where Leaders meet in summits and waive national sovereignty, and pool sovereignty regionally. Soon a New Charlemagne will rise out of Financial Armageddon, Revelation 13:3, to rule the Euro zone, where Germany will be preeminent, as a type of revived Roman Empire that governs the European continent. Euroland’s future leaders is today, one of seemingly little authority, and appropriately is termed the Little Horn, Daniel 7:7-8. Last Days Org provides a list of this leader’s characteristics. And A Thousand Points Of Resistance provides a list of this leader’s characteristics as well.

Wolfgang Weber, writes in WSWS President Gauck demands more support for Germany’s army.    President Gauck’s recent speech to the federal armed forces lays bare the ideological foundations of the drive for the militarization of Germany’s foreign policy.

Europe’s soon coming Sovereign, Revelation 13:5-10, will come with Germany’s military might, to rule globally, Daniel 11:39-44, and will establish his headquarters  in Jerusalem, Daniel 9:27; Matthew 24:15, for mankind’s last 3 and ½ years, Daniel 7:25 and Revelation 13:7. Perhaps the EU’s king will be Olli Rehn, or Herman van Rompuy, or Jean-Claude Juncker, or Guido Westerwelle; he will be accompanied by a banker, Revelation 13:11-18,  perhaps Jens Weidmann, or Mario Draghi; their word, will and way, will be the law of the Eurozone, replacing all constitutional and historic law. Their diktat money system will replace today’s fiat money system where diktat will serve both as money and credit. People will actually come to worship the Beast System and its rulers, Revelation 13:3-4.

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