Thursday, August 18, 2011

Morning Update/ Market Thread 8/18 – Boycott the Elections Edition…

Good Morning,

No doubt about it, confidence is lost. Not only are equities down hard this morning, but gold is above $1,820 an ounce and trucking. The dollar is up with the deleveraging, bonds are sharply higher, oil is down, silver is up and food commodities are lower. This is the lack of confidence trade, however money is still flowing into bonds, when money is flowing out of bonds with the above other conditions then you know you really have a problem. Of course the markets aren’t real as we don’t know where the “Fed” and HFT manipulators are pushing things. Keep your eye on gold, it is parabolic.

The oil chart is saying that another wave down has started, but so are the equity charts where we have now broken down from the rising wedge:

The rising wedge in the futures is also breaking, it was wider due to activity that occurred outside of normal trading hours:

Weekly Jobless Claims jumped once again, this time rising to 408,000 for the prior week. Of course the prior data was revised higher as well, same old game:
Initial claims rose in the August 13 week but today's report still points solidly to month-to-month improvement for the August employment report. Initial claims came in at 408,000 for a 9,000 rise from 399,000 in the prior week which was upwardly revised by 4,000. But the four-week average fell for the seventh straight week, down 3,500 to a 402,500 level that is nearly 20,000 lower than the month ago comparison.

Continuing claims were little changed, up 7,000 to 3.702 million with the four-week average down 5,000 to 3.716 million. The unemployment rate for insured workers is unchanged at 2.9 percent.

There are no special factors distorting the data which again point to improvement in the labor market.

The CPI, which vastly understates inflation, rose .5% in July, much more than expected, but largely due to rising food costs and the short term bounce that occurred in oil. Still, it’s claiming 3.6% consumer inflation for the year which again is about 9% lower than tracked by Shadow Stats. This single distortion ripples through all others and is the most important false data that is at the root of the bad math, and at the root of the disconnect between reports and reality. That disconnect is a very large part of the reason people are losing confidence. Here’s Econoinane:
Consumer price inflation surged in July on stronger gasoline and food costs. The consumer price index in July jumped 0.5 percent. The June number topped the median estimate for a 0.2 percent increase. Excluding food and energy, the CPI increased 0.2 percent after a 0.3 percent jump the prior month.

Turning to major components, energy rebounded 2.8 percent after dropping 4.4 percent the month before. Gasoline jumped 4.7 percent, following a 6.8 percent plunge in June. Food price inflation accelerated, jumping 0.4 percent, following a 0.2 percent rise in June. Within the core the shelter index accelerated in July (largely lodging, up 0.9 percent), and the apparel index again increased sharply ( up 1.2 percent). In contrast, the index for new vehicles was unchanged after a long string of increases.

Year-on-year, overall CPI inflation worsened to 3.6 percent from 3.4 percent (seasonally adjusted) in June. The core rate rose to 1.8 percent from 1.6 percent on a year-ago basis. On an unadjusted year-ago basis, the headline number was up 3.6 percent in July while the core was up 1.8 percent.

Despite a sluggish economy, inflation is back but most of the acceleration is supply related, notably for food. And energy rebounded only partially from the prior month. The lodging subcomponent, however, probably is seeing some improved demand which is actually a good thing. Inflation is up but not much is related to a surge in demand.

Not much related to a surge in demand? LOL, are these clowns for real? People are getting angry, deservedly so, over this type of inane “analysis.”

A lot of data comes out at 10 Eastern this morning, including Existing Home Sales, the Philly “Fed” Survey, and supposed “Leading” Indicators. We’ll report those inside of today’s Daily Thread.

Boycott the election? You bet. Withdrawing all participation in the central banker backed schemes is really the only appropriate action from my point of view. I don’t support or participate in their phony markets, I don’t support or participate in their phony banks, so why should I support or participate in their phony elections?

No more for me. Not until the money power has been restored to the people. I refuse to be manipulated with their inane and insane distract you drivel. The latest drivel of which dripping from Michele Bachman’s mouth, “I’ll bring back $2 gas!”

Major league eye roll there.

As they say, fool me once… well I think I’ve been fooled many, many times when it comes to elections, that was before I really understood that the politicians are nothing but central banker spokespeople. I saw Obama talk, and man did I not like Bush. That was the setup, you WANTED to believe and to have HOPE! He flat out said he was going to end the wars and bring the troops home! Of course he couldn’t add 2 + 2, but at least he was on point regarding the insane wars… but then once again actions completely disconnect from words, all confidence is now lost and I can’t say who the worst president is, but I actually now know the reality is that the United States doesn’t really have a President at all, what we have is a central banker spokesman. Doesn’t matter the flavor, they cannot get elected in what’s becoming billion dollar campaigns without central banker support.

Whatever your pet issue in politics is, be it war, abortion, gay rights, whatever… you need to understand that they are all secondary to the most important issue which is WHO controls the production of money. For it is they WHO control all those other issues! If YOU want to have a legitimate voice in a real government, YOU must control the production of money!

By YOU, of course, I mean that your representative in government is supposed to represent you, not a central banker, not a corporation.

Change is coming quickly now. “Other events” are in full motion and you are going to see them accelerate. Keep your eye on the ball and do not be distracted with their games. Withdraw your support from their games and get into something real.