Monday, July 18, 2011

Morning Update/ Market Thread 7/18 - Clowns to the Left, Jokers to the Right Edition…

Good Morning,

Equity futures are lower prior to the open with the dollar higher, bonds flat, oil down slightly, gold hurdling $1,600 an ounce to another all-time high, silver gapping higher, while food commodities wither in the scorching heat of impossible math.

Treasury International Capital Data (TIC) was released for May, Econoday reports the Net Long Term Securities Transactions (line 19) to be positive at $23.6 billion. In fact, however, the total Net Inflows for May were $-67.5 Billion (line 30 which nets out the total). Anyway you want to slice it none of it has an auditable trail and is therefore suspect at best – outright fraud is more likely. Here’s Econoday:
Highlights
Held down by increasing US investment overseas, net inflow of long-term securities slowed to $23.6 billion in May for the weakest reading of the year. US resident outflow totaled $21.0 billion, up from $14.2 billion in April and compared with $30.6 billion in March. Low US yields are likely pushing investment overseas and limiting investment at home.

Foreign buying of US long-term securities totaled an in-trend $44.6 billion in May and was centered in Treasuries along with a respectable total for equities. Foreigners sold government agency bonds during the month though they were moderate buyers of US corporate bonds. Foreign purchases were roughly split evenly between private investors and official institutions.

A look at foreign holdings of Treasuries shows incremental gains for China, to $1.16 trillion, and Japan, to $912.4 trillion, with a slightly more than incremental gain for UK accounts to $346.5 billion. OPEC, the fourth largest holder of Treasuries, shows a more than $8 billion gain to $229.8 billion. Russia, the ninth largest holder, fell more than $10 billion to $115.2 billion.

Here’s the entire TIC report:
TIC Data for May 2011

The Housing Market Index (can you say “Depression?”) is released at 10 Eastern this morning. Data the rest of the week is fairly light, with Housing Starts, Existing Home Sales, Philly “Fed,” and “Leading” Indicators.

The debt saturated condition continues to rattle Europe, of course, where there is huge underlying stress in the credit markets. The gap between this reality and equities has never been wider with the sick mainstream media publishing articles stating that the European debt crisis won’t affect our banks! Sick. In my mind that is a far more damaging and worse crime that tapping someone’s cell phone. But now we have arrests for that activity… surprising, I guess Mr. Murdock must be out of the central banker’s favor, and thus he shifted from the “club” side of the law, to the law that applies to everyone else.

Speaking of central banker mischief, note how all of the big banks report billions upon billions of profits and claim to have improving credit conditions that allow them to release “reserves” that magically turn into Ferraris for them? Well how does that square with MGIC’s report where they report losses amongst higher claims and more people falling behind on their payments? Gee, claims only rose 44% in the last quarter, as values plunged! Just a reminder that MGIC is the largest monoline insurer of mortgages. Again, just exposing more lies and more fraud from the central criminals.

The debt ceiling debate is really exposing the political clowns for what they are – central banking lackeys and manipulators of public opinion. Their scare you tactics have actually made the governors ban together to demand (dammit) that a “deal” be reached on the debt limit ceiling before economic catastrophe strikes! Laugh out loud at those clowns.

They don’t realize that economic catastrophe struck a long time ago and that they are a big part of the problem by not changing the way special interests (especially the central banks) are allowed to create their own money and use it to influence politics. This has led to impossible math that became impossible long ago.

This morning Weiss Ratings (not taken seriously by the mainstream, yet more accurate) downgraded America's debt rating to "C-minus — approximately equivalent to a BBB- rating by S&P, or one notch above speculative grade (junk)."

Guess I’m… Stuck in the Middle with You!