by Sheraz Mian
Stocks opened lower in today’s session, with Europe-centric concerns and more follow-through from Wednesday’s Fed statement as the likely catalysts. The jobs report coming out tomorrow has assumed even greater significance following the strong GDP report and the market’s evolving Fed outlook.
Concerns about Europe’s disinflationary pressures were kept alive today, with July CPI for the region coming shy of market expectations – up +0.4% in July vs. consensus estimates of +0.5% and the European Central Bank (ECB) target of +2%. The direct implication of this is that the ECB will need to more be aggressive in its efforts to reverse the trend, at a time when other central banks like the U.S. Fed and the Bank of England are contemplating moves in the other direction.
Continue Reading at FinancialSense.com…
by Jeff Nielson
Bullion Bulls Canada
Follow along, ladies and gentlemen, as the amazing tale of the U.S. “economic recovery” is presented to readers. This journey into the surreal begins with an obvious question: how was this Never-Ending Recovery created, which (supposedly) is already roughly twice as long as any ordinary recovery, and (according to the “experts”) shows no sign of ever ending?
Any/all close followers of the Never-Ending Recovery will have no problem answering this question. It was created through the stalwart “leadership” of the Federal Reserve, under the expert tutelage of B.S. Bernanke. He printed, and printed, and printed U.S. dollars at an exponentially increasing rate, never before seen with any paper currency – which did not immediately plunge into worthlessness via hyperinflation. And those are only the $trillions which Bernanke admits printing.
Continue Reading at BullionBullsCanada.com…
by Andrew Hoffman
Do you want to know what hyper-inflation looks like? Well guess what? Despite what the “experts” tell you, it is decidedly not a “thing of the past.” The most famous 20th century example was Weimar Germany, where stocks soared as the Reichsmark collapsed; but far more recently, the same thing occurred in 2009 Zimbabwe. In both cases, the illusory nominal stock gains were eventually swamped by permanent real losses relative to inflation – and precious metals – which is where many of the world’s Central bank juiced markets are likely headed in the coming years.
To wit, last night’s announcement that Argentina officially defaulted on its debt causing the Argentine Peso to collapse to new all-time lows (at least, all-time lows for this version of the Peso) – just as we have seen with the equally hyper-inflating Venezuelan Bolivar.
Continue Reading at MilesFranklin.com…
by Doug Casey
One of my favorite podcasts to listen to is The Peter Schiff Show (www.SchiffRadio.com).
Peter always does an excellent job of dissecting the latest economic news and cutting through the smoke and mirrors of government statistics.
Recently he had Doug Casey on his radio show to discuss what’s really happening with the economy. And it’s nothing close to what the talking heads in the financial media would have you believe.
I’m happy to bring this fascinating discussion to International Man readers. I think you’ll not only enjoy it, but you’ll also learn something too.
Continue Reading at InternationalMan.com…
JPMorgan is discussing the possibility of buying Argentina’s sovereign debt from a group of dissident bondholders, Dow Jones reported on Thursday, citing sources familiar with the matter.
The South American nation is fighting a court decision that determined it must treat all bondholders the same, despite a massive restructuring agreement stemming from its default more than a decade ago. A group of so-called “vulture fund” holdouts are demanding that Argentina honor their bonds without a haircut.
The Dow Jones report said buying the bonds is one of many options and the talks between JPMorgan and bondholders were still fluid.
Continue Reading at CNBC.com…
Eurozone inflation has fallen to its lowest level since the height of the financial crisis, sliding further into what the European Central Bank (ECB) has described as a “danger zone”.
Prices rose in the single currency area by 0.4% in July, from 0.5% in June.
The ECB considers that an inflation rate of below 1% poses a risk of deflation.
Separate figures show that unemployment in the region fell slightly to 11.5% in June compared to 11.6% in May.
Continue Reading at BBC.com…
by Polina Devitt and Gabriela Baczynska
(Reuters) – Russia fought back on Wednesday over new U.S. and EU sanctions imposed over Ukraine even as G7 leaders warned of further steps, while Ukraine’s government accused pro-Russian rebels of placing land mines near the site of a crashed Malaysian airliner to prevent a proper investigation.
Russia announced a ban on most fruit and vegetable imports from Poland and said it could extend it to the entire European Union, a move Warsaw called Kremlin retaliation for new Western sanctions over Ukraine imposed on Russia on Tuesday.
Moscow called the new EU and U.S. sanctions “destructive and short-sighted” and said they would lead to higher energy prices in Europe and damage cooperation with the United States on international affairs.
Continue Reading at Reuters.com…
Jim Rickards, Senior Managing Director at Tangent Capital, discusses whether Argentina’s second default on its sovereign debt will have a contagion effect on global financial markets.
from Zero Hedge
Over the past 6 months, there has been much talk about the strategic proximity between Russia and China, made even more proximal following the “holy grail” gas deal announced in May which would not have happened on such an accelerated time frame had it not been for US escalation in Ukraine. But little has been said about that other just as crucial for the “new BRIC world order” relationship, that between Russia and India. That is about to change when yesterday the Russian central bank announced that having been increasingly shunned by the west, Russia discussed cooperation with Reserve Bank of India Executive Director Shrikant Padmanabhan. The punchline: India agreed to create a task group to work out a mechanism for using national currencies in settlements. And so another major bilateral arrangement is set up that completely bypasses the dollar.
Continue Reading at ZeroHedge.com…
by Dennis Miller
You’re probably something of an expert in your own field—and that field probably isn’t insurance or annuities. How, then, can you work through the minefield of clauses, guarantees, and pages of small print? Here are nine ways to start.
While you may feel uncomfortable doing this, you’re the one putting down thousands of dollars, and you have every right demand this. Remember: caveat emptor! It’s the buyer who must beware; you must protect yourself. Ultimately, the language in the annuity contract is what matters, but it doesn’t hurt to memorialize your verbal agreement with the agent in writing.
Hopefully your agent is totally honest and will help write the agreement, and both parties can sign and date it. If the agent starts to waffle, trust your instincts.
Continue Reading at GoldSeek.com…
by Monty Pelerin
Monty Pelerin’s World
Obama announced his intentions to “transform America” as a candidate although never specified what that meant. After almost six years, the picture is becoming clearer. Now it appears that the phrase actually involves more than America. It appears that Obama believes he can transform the world. Regarding relationships with US allies and enemies that certainly seems to be the case.
Some believe that Obama’s foreign policy reflects incompetence or disinterest. Perhaps, although he may believe it is necessary to transform the world in order to achieve his unequivocally-stated goal of transforming America. His early self-delusion as President-of-the-World (now laughable) may reflect the belief that he either has this mandate or requires it in order to transform America.
Continue Reading at EconomicNoise.com…
Opinion: The news we’ve been waiting for, but does Yellen believe it?
by Rex Nutting
WASHINGTON (MarketWatch) — This is the news we’ve all been waiting for: Wages are finally rising. And that means the economy is getting strong enough for the Federal Reserve to at least consider raising short-term interest rates to a normal level.
The Bureau of Labor Statistics reported Thursday that the employment cost index rose 0.7% in the second quarter, the fastest growth since 2008. Wages and salaries increased 0.6% (the most in nearly six years), while benefit costs increased 1% (the most in three years).
The rise in benefit costs was largely due to the costs of funding pensions and not providing health insurance. Health-insurance costs are up a modest 2.7% in the past year despite the new requirements of the Affordable Care Act.
Continue Reading at MarketWatch.com…
by Theodore (Ty) Andros
This is part II of IV of Useful Idiots and The Something for Nothing Society. In part I, we covered the beginning of the evolution from a capitalist constitutional republic during Teddy Roosevelt’s presidency a century ago into the progressive socialist state we have become today. This transformation has taken over a century and has been implemented in such an incremental manner as to be mostly imperceptible to the public at large. It began with the creation of the Federal Reserve (privately owned central bank owned by multi-century banking families) and UNSOUND money (which transformed money from a place to store your savings and labor and a store of value which moved your savings into the future, into an instrument of confiscation, theft and exploitation of the public). The other element of the road to serfdom was the personal income tax, also implemented at that time. This series is a connect the dots exercise designed to allow you to see the enormity and inevitability of the societal collapse we find ourselves in. Its causes, the system that is in place driving it forward and the reality of our situations, better allow you to see and prepare for its demise, hopefully benefitting from it. It is the greatest opportunity in history but requires a keen understanding of history and Austrian economics which has predicted it all. The history of this collapse of empires is being presented to you in this series.
Continue Reading at GoldSeek.com…
by David Kranzler
Investment Research Dynamics
Now that everyone is blaming Russia – instead of the weather – for everything that is happening (Adidas blamed Russia for its poor results instead of the fact that its shoes suck) – I’m wondering when Obama is going to come out and tell us Russians killed Jesus.
Of course, ignore the Chicago PMI report today – which just posted the 2nd biggest drop on record and the biggest ever miss vs. Wall Street Einsteinian forecasts: LINK.
Conveniently skip that fact and continue to believe in a 4% GDP report and Santa Clause.
Continue Reading at InvestmentResearchDynamics.com…
from Zero Hedge
Update: According to Ambito the deal is a no go as Italian bondholders (and likely all others) claim that a private deal with a buyer of holdout bonds would also trigger the RUFO clause, thus making the deal meaningless and forcing Argentina to payout billions more. From Ambito:
Italian bondholders say a private agreement also would trigger the clause RUFO
The representative of a group of debt holders Argentina Italy, Tulio Zembo said that any agreement between private RUFO also would trigger the clause.
“I do not understand the idea of banks because that would trigger the RUFO” Economy Minister said yesterday. Please do not help us because it makes the situation worse,” said Zembo in dialogue with Radio La Red
Continue Reading at ZeroHedge.com…
by A. Ananthalakshmi and Jan Harvey
SINGAPORE/LONDON, July 31 (Reuters) – Chinese gold jewellery demand fell for the first time in eight years in the second quarter and could drop as much as 20 percent in the full year, a leading precious metals consultancy said.
A slide in Chinese demand will take away a key supporting factor for gold prices, already pressured by an improving global economy and U.S. stimulus withdrawal.
Many Chinese jewellery makers saw a 40-60 percent drop in gold fabrication in the second quarter, Sara Zhao, a GFMS analyst at Thomson Reuters, told the Reuters Global Gold Forum on Thursday.
Other industry sources also said higher gold prices and a weaker yuan are weighing on demand, and fresh buying has also been tempered by last year’s record purchases.
Continue Reading at Reuters.com…
by Greg Guenthner
Growth is good.
This week, we’re seeing growth in some unusual places.
Gross Domestic Product screamed higher during the second quarter after slumping during the unusually cold winter months. Of course, no one really saw that coming. GDP rose 4%, smashing analyst estimates as Americans bought cars and appliances at the fastest pace in almost five years, Bloomberg reports.
Oh, and we’re starting to see some real growth in social media companies’ bottom lines. And as you’ve probably already guessed, no one saw that coming, either.
Yelp Inc. (NYSE:YELP) reported its first profit ever as a public company Wednesday afternoon.
Continue Reading at DailyReckoning.com…
by Richard Russell
These are four of the biggest threats to the bull market. According to Hugh Johnson Advisors, first is the threat of oil skyrocketing over the turmoil in the Middle East, and natural gas prices soaring as Russia retaliates over U.S. and European trade sanctions. Number two, interest rates surging as the Fed continues its tapering activities. The third threat is that the housing recovery drops dead. This could happen if fixed rates for 30 year mortgages rise above 5% by early next year. The next threat would be a stock market melt-up against the possibility of an unexpected jump in U.S. growth, in which case investors who are sitting on the sidelines could panic about missing out on the action and decide to jump in as the market reaches crazy heights. This could create a dangerous bubble as the exploding market leaves all thoughts of earnings behind.
Continue Reading at FinancialSense.com…
by Chuck Butler
Good Day! … And a Tub Thumpin’ Thursday to you! I’m not feeling too much like Tub Thumping right now, but maybe later, if that’s OK? HA! Well, the Dollar Bugs were doing some Tub Thumping yesterday after the 2nd QTR GDP first reading printed… Cardinals get taken to the woodshed by the Padres, and have you seen the video that’s gone viral of the little girl that breaks down crying when told that her baby brother is going to grow up someday? I think back to my two older sisters, and how they babied me (until the rest of our siblings came along) and see them going through the same emotions…
Front and Center this morning, 2nd QTR GDP in the U.S. surprised most observers by printing at a 4% clip! This sent the dollar soaring, against the currencies and metals. It was NOT a case of traders looking under the hood as I was led to believe it would be, and the 4% print immediately brought about visions of sugar plums dancing in the heads of the rate hike campers… It got really ugly for a while, and then things seemed to calm down. This morning, the dollar is still in charge, but the moves are small at this point.
Continue Reading at DailyPfennig.com…
by Simon Black
In the absurdly best-selling book The 7 Habits of Highly Effective People, author Stephen Covey wrote about abundance vs. scarcity.
With the abundance mindset, people confidently view the world as full of resources and opportunities… that there’s more than enough to share… and that more success is coming soon.
The opposite is the scarcity mindset, where people view everything as scarce and finite. If you’re winning it’s because I’m losing.
The scarcity mindset reinforces that there’s never enough time, never enough money. And since we can never be sure about the future, we have to ration every last possible resource and grab every bit for ourselves.
Continue Reading at SovereignMan.com…
from The Daily Bell
Federal Reserve stays on cruise control … The U.S. economy is strengthening but the Federal Reserve remains in cruise control. The Fed decided to once again reduce its monthly bond purchases by $10 billion, as expected. The central bank has been gradually reducing, or tapering, its monthly bond purchases since January. It will now buy just $25 billion a month. That’s down from a peak of $85 billion when the Fed started its third round of quantitative easing, a policy dubbed QE3 on Wall Street. – Money CNN
Dominant Social Theme: Once again, the financial leaders of the free-world have guided the US economy through the shoals of economic disaster and its citizens have emerged relatively unscathed.
Free-Market Analysis: Recovery? Really?
Now the trumpets are sounding for a US recovery, but as we’ve pointed out many times, what is going up mostly is the stock market as the Fed determinedly debases currency.
And as we’ve predicted, Ms. Yellen has no intention of stopping. She is cutting back nominally on the Fed’s QE program, but we’ll see what impact that has, if any. There are plenty of other methods that Ms. Yellen has to add liquidity to the economy. No doubt she will continue to use all of them.
Continue Reading at TheDailyBell.com…
by Andrew P. Napolitano
It has been well established under the Constitution and throughout our history that the president’s job as the chief federal law enforcement officer permits him to put his ideological stamp on the nature of the work done by the executive branch. The courts have characterized this stamp as “discretion.”
Thus when exercising their discretion, some presidents veer toward authority, others toward freedom. John Adams prosecuted a congressman whose criticism brought him into disrepute, an act protected by the First Amendment yet punishable under the Alien and Sedition Acts, and Thomas Jefferson declined to enforce the Acts because they punished speech, and pardoned all those convicted. Jimmy Carter asserted vast federal regulatory authority over the trucking and airline industries, and Ronald Reagan undid nearly all of it.
The president has discretion to adapt law enforcement to the needs of the times and to his reading of the wishes of the American people.
Continue Reading at LewRockwell.com…
by Ed Steer
Ed Steer’s Gold & Silver Daily
Yesterday In Gold & Silver
It was a very quiet trading day on Wednesday everywhere on Planet Earth. Gold traded basically unchanged up until 1 p.m. BST in London, which was 20 minutes before the Comex open. There was a bit of price flurry in the first hour of trading in New York, but that was it—and gold traded mostly flat for the remainder of the day. Nothing to see here—and the high and low ticks aren’t worth looking up.
Gold closed down for the third day in a row—and closed at $1,294.50 spot, down $4.30 from Tuesday’s close. Volume, which had been microscopic for most of the day, netted out to 139,000 contracts, with the vast majority of that occurring in December, which is now the new front month for gold.
Continue Reading at CaseyResearch.com…
by Pater Tenebrarum
Bureaucrats versus a Dynamic Free Society
In the preface to his 1944 book “Bureaucracy”, Ludwig von Mises tried to elucidate the difference between the German and the American mentality as he saw it at the time. In Germany, classical liberalism had been thoroughly suppressed in the decades following the failed revolution of 1848. Of Germany’s youth Mises remarked: “They had one aim only: to get a job as soon as possible with the government.”
To this day, the ideas of classical liberalism find very little resonance in continental Europe. It is no wonder that the UK – in spite of having become a welfare state as well – is continually clashing with the EU’s socialistic super-state bureaucracy in Brussels.
Continue Reading at Acting-Man.com…