Tonight’s video is ready – CLICK HERE
Tuesday events:
8:30am May PPI (last m/m 0.3%, y/y -3.7%, ex food & energy last m/m 0.1%, y/y 3.4%), May Housing Starts (last 485K), May Building Permits (last 498K)
9:15am May Industrial Production (last -0.5%), May Capacity Utilization (last 69.1%)
10:00am TAF results
4:30pm API Crude Oil/Gasoline/Distillate Inventories
Recent Posts:
- Taxpayers to the Rescue of Afghanistan Banking Crisis?
- Economic Data and Earnings Schedule for September 2 2010
- Christina Romer Makes a Final Recommendation Before Leaving To Teach Keynesian Economics
- Homebuilder Hovnanian (HOV) Reports Dismal Quarter
- Auto Sales Data for August 2010
- Stock Market Rewind – September 1, 2010
Tks Chuck and Bee – interesting article.
I think it is broadly correct, although precisely when and how swiftly the USD’s demise will come about is not at all clear. My own guess is that discontent with the dollar might rumble on for quite some time before a definitive crisis finally erupts; that crisis is probably some years away – but who can tell for sure?
Some added thoughts from a foreigner who has spent his adult life building a great deal of respect for Americans and what the US stands for:
1. You folks have had your country taken away from you by the corporate elite. Specifically, the defence-industrial complex and the Wall Street mafia – but the ‘grab’ extends further than that. (I don’t know how much play it is getting in MSM, but there is a US base under construction in Afghanistan right now which – as far as I could see – must rival Edwards AFB in size. There is a massive ramp-up underway there, and this will cost a lot of money and a lot of lives in the years ahead. Do you really need to spend as much on ‘defence’ as the rest of the planet combined?)
2. Alongside imperial overreach, regulatory capture, and immense personal greed, the US economic model is being eroded by the power of special interest groups. Critics of the Obama administration too often refer to ‘creeping socialism’. As a European, I can guarantee that the US is not becoming more socialist. What is happening is not for the benefit of people generally, but is a manifestation of crony capitalism. (On my way home last week I was in Russia. Somebody there commented to me that the only difference she could see between the US and Russia these days was that whereas in Russia the government controls the oligarchs, in the US it’s the other way around.)
3. It is not too late for the US to rescue itself, but there is little sign yet this is going to happen. It is very difficult to see presidential elections as much more than a quadrennial rebranding exercise which allows the powers-that-be to maintain a charade of representative democracy. Too cynical, perhaps, but I’ve yet to see any real signs of ‘change you can believe in’.
4. From this foreigner’s perspective US markets are opaque, corrupt, and not to be trusted as anything more than short-term trading vehicles. For longer-term investment purposes they seem (with the exception of liquidity) to have few advantages over many of the larger emerging markets, and the singular disadvantage that they are clearly ex-growth (as is Europe, of course).
The United States has been a beacon for over two centuries and remains a country with immense potential. It is, however, being failed by its leadership class and – as far as I can gather from my side of the Atlantic – the population as a whole appears to neither know nor care what is happening beyond their own immediate, day-to-day experiences. I really hope I’m wrong.
One final point: I am writing this comment on a US site read mainly by Americans, and whilst some readers will profoundly disagree with what I’ve said most will give it a fair hearing. This in itself speaks loudly to the inherent strengths of America. Don’t let ‘them’ take your wonderful country away from you.
I agree with much of what you have stated. Thank you for your thoughtful insights. Please know there are many Americans who will not let “them” take our country. I would like to use your comments on my webpage. Please email me at capitalisa@gmail.com if you have any problem with that. Your thoughts speak to a wider issue I have meant to address. Again, thank you.
Everything Chris Hedges has said in his piece, I believe. Whether or not the demarcation line is this week is anyone’s guess.
Our oligarchs are the ones who have the means to finance both sides of a war and come out the winners. How people can maneuver around power like that is on an individual basis. Those who rise up against these oligarchs are very brave. Can they survive? I don’t know.
SteveH, don’t think that we don’t see what’s happening. We just can’t fix it.
Hello Steve and others,
Love England. Hope to go for a visit again sometime soon.
That said, Steve can you please furnish any evidence for what you say?
“Corporate elite” or how about “corrupt markets”.
Some of the very broad generalities that you speak of, can be found in inflamatory speeches throughout our 233 year history. Nothing new.
RE: Chris Hedges article
Are you kidding me? This is a joke. Chris has credibility?!?
“America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.”
“The United States will begin to resemble the Weimar Republic or Zimbabwe.”
“while we endure the greatest economic crisis in our history”
Chuck, please show me through your knowledge of America’s history that this is the greatest economic crisis we have ever endured.
If Chris is correct,
Who is going to buy bonds backed in rubles?
Brazil?
Who is going to buy bonds backed by the yuan?
The EU?
To give Chris Hedges space on your site is………………
Very very nicely written SteveH. As a non-American & travelled well, I agree to most.
A bit of side humor – Quote from the movie – The Day The Earth Stood Still, “At the brink of destruction, humanity will change”
Point is, how many really acknowledge that the end is near !!
On the trading side (which I am more keen on
, 923 not broken. So the end is not yet near I guess 
Have initiated some small short positions, increased my FAZ hedge. And watching. I will be bear if 920 gets broken & closed (ADX may do a crossover soon), but till then its pure consolidation trading BOTH sides – long & short.
Happy trading folks.
)
- By a Short term Bull, Long Term Bear, Immediate term a Sheep
And Indy, you are of course absent from the chat when the market is down…
My good friend FM – I miss the chat too but it is blocked at work but I am not missing the action – Scanned the chat yesterday, I understand the bears keenly missed a bull yesterday.
Anyway, I hope to join you folks in the bear circle very soon, I hope the market also breaks some key levels.
SteveH,
Hat’s off to you, an excellent essay which I agree with in all aspects. I already grieve for the loss of my country which no one seems to be fighting for. I write letters and attend tea parties, only to be branded a conservative right upstart. The general public seems to not understand what is happening to them. I hope Lisa is right, I hope there are a lot of us who won’t let the oligarchs continue. 2010, but especially, 2012 will be very telling…
So far no evidense. Just words. More speeches. Will wait.
Steve comes from England. For those that do not know, England has close to 3 dollars debt to 1 dollar income. America is .95 debt to 1 in income. BTW Ireland is 8 dollars debt to 1 dollar in income.
England NEVER had the tradition of capitolism. They have ALWAYS been a monarchist followed by socialistic semi-class system.
England has very precious few resources.
So, if England, as the world power it was, never experienced Chris Hedges “America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.â€
“The United States will begin to resemble the Weimar Republic or Zimbabwe.â€
“while we endure the greatest economic crisis in our historyâ€
Why would we?
I find people money is where their heart (belief is).
Be honest now.
Does your money follow your belief?
Are you shorting the dollar with all of your money?
If you are, how much of your money in your belief?
I can tell you honestly, that 160% (margin) is in my belief.
SteveH,
Thank you for your wonderful and very insightful comment. It was a pleasure to read.
Chuck, is this the first time in America’s history, the FED has bought treasuries?
Scott- It was done in the early 60′s last