Thursday, November 24, 2011

Open Thread - Happy Thanksgiving Edition!

Wednesday, November 23, 2011

Morning Update/ Market Thread 11/23 - Tales Grow Taller on Down the Line Edition...

Good Morning,

Equity futures continue to tumble this morning, with the dollar rising sharply, bonds rising but then reversing, oil lower, gold & silver lower, and food commodities moving lower with wheat breaking a key support level that is the neckline of a very large head & shoulder’s pattern.

The morally crusted Mortgage Banker’s Association reports that Purchase Applications rose by a completely not believable 8.2% in one week last week, while the Refinancing Index fell by 4.0%. Sorry not one utterance out of their lips or off their computer is believable – 100% guarantee you that true statistics don’t move 8%, 20%, or 30% in one week. Again, this outfit is 100% hypocritical and they should not be allowed to produce self-interest driven economic statistics that are disseminated to the world. Here’s Econoplicit:
Veteran's Day did blur mortgage application data with the subsequent week showing a strong rebound that puts the purchase index back on trend. The volume of purchase applications rose 8.2 percent in the November 18 week, back on an upward path but still, at about minus five percent, below the year-ago level. Refinance volume wasn't able to rebound, down 4.0 percent in the latest week though applications for government loans did rise with the government share of activity, at 12.3 percent, the highest of the year. Rates were steady in the week, averaging 4.23 percent for conforming balances ($417,500 or less) and 4.59 percent for jumbo loans ($417,500 or more). Next data on the housing sector will be Monday with new home sales.


Weekly Jobless Claims rose to 393,000 – remember, it takes numbers below 350k to show any real job growth:
Initial jobless claims are below 400,000 for a third straight week in what is a hopeful sign that the jobs market is improving. Claims in the November 19 week came in at 393,000 vs a revised 391,000 in the prior week and 393,000 before that. The four-week average of 394,250, down four weeks in a row, is below 400,000 for a second week in a row.

Continuing claims in data for the November 12 week rose 68,000 to 3.691 million with the four-week average down slightly to 3.672 million. Changes in continuing claims are hard to read given that declines are a mix of benefit expiration and hiring. The unemployment rate for insured workers is unchanged at 2.9 percent for a fifth straight week.

The Labor Department describes today's report as straight forward and without special factors. But the ongoing financial trouble in Europe is a major special factor that continues to unfold, raising the risk that weakened European demand may begin to drag on US growth and in turn job growth.

Really, you mean that a debt saturated Europe is a “special factor?” LOL, how about a debt saturated globe ruled by narcissistic psychos who were wrongly given the power to coin money with no one regulating the value thereof?

U.S. Constitution - Article 1, Section 8: The Congress (your representative) shall have the power “Clause 5: To coin Money, regulate the Value thereof…”
This is not occurring. Nowhere does the Constitution give Congress the right to subjugate this power or to give it to a few private individuals. This is THE MOST IMPORTANT CLAUSE IN THE CONSTITUTION. It clearly spells out WHO it is that is supposed to be in charge of the production and regulation of money. It is the correct rule of law and it makes the private “Fed” a completely illegal group. This is critical because transferring that power to a few individuals gives them the ability to make money from nothing and then to corrupt ALL the other provisions of our rule of law. This is the one point that the people need to get focused on – it is here where all answers are found – I’m talking about our problems with morality, ethics, war, entitlements, work ethic, everything!

You name the ailment, and I’ll tell you how it relates to WHO it is that controls the production of money. A common currency MUST come into being without benefiting the few, it must come into being without favoring anyone. Truly sovereign money does this, it does not come into being as someone’s debt burden.

Regarding Jobless Claims, remember to keep the longer term perspective in mind – everything above the red line is losing jobs:

Initial Claims:

Durable Goods Orders continued to decline in October, falling .7%. Points to consider… We make almost nothing in America anymore, the production situation is so pathetic that a few aircraft orders one way or the other causes this measurement to swing wildly – that is a national embarrassment, Ross Perot was right about that giant sucking sound you hear. Another point is that they measure Durable Goods in DOLLARS, not widgets, and thus they are way overstated. Here’s Econoday consenting to the lies:
Durables orders in October were pulled down by a drop in civilian aircraft orders. Otherwise, durables orders were moderately positive net. New factory orders for durables fell 0.7 percent, following a decline of 1.5 percent the prior month (previous estimate, down 0.6 percent). The October decline was less negative than the consensus forecast for a 1.0 percent fall. Excluding transportation, durables advanced 0.7 percent after a 0.6 percent rebound in September. The October increase topped the consensus forecast for no change in durables excluding transportation.

Weakness in October was led transportation which fell 4.8 percent after dropping 7.6 percent in September. Within transportation, weakness was in nondefense aircraft which declined 16.4 percent after a 26.8 percent fall in September. These are essentially swings in orders for Boeing aircraft. Defense aircraft rebounded 10.2 percent, following a 34.8 percent drop in September. Motor vehicles rebounded 6.2 percent after a 2.4 percent dip the month before.

Outside of transportation, orders were mixed but net positive. Increases were seen in primary metals, up 3.0 percent; machinery, up 1.6 percent; and "other" durables, up 1.2 percent. On the downside were fabricated metals, down 0.3 percent; computers & electronics, down 0.1 percent; and electrical equipment, down 5.2 percent.

Turning to private investment numbers, nondefense capital goods orders excluding aircraft declined 1.8 percent, but followed increases of 0.9 percent in both August and September. Shipments for this series decreased 1.1 percent in October, following a 3.1 percent boost in August and a 1.0 percent dip in September. While volatile, nondefense capital spending appears to remain on a mild uptrend.

Despite monthly volatility, forward momentum continues for the manufacturing sector. Given the fact that Boeing recently announced sizeable new orders and that auto sales remain healthy, the underlying trend for manufacturing looks moderately healthy and should help the recovery gain strength, albeit gradually.

Healthy? Really?

Okay, let’s zoom out and look at the Durable Goods chart back as far as it will go, about 1992. We know that total employees in Manufacturing is at the same level as 1942, so let’s put them together on the same chart from about 1980:

Durable Goods with Employees in Manufacturing:

Note on the chart above how Durable Goods are measured in DOLLARS. This means that this chart is NOT REAL, does not reflect reality at all UNLESS we truly correct it for inflation. I can’t do that because the “Fed” has completely distorted the reality of inflation, but what I can do is simply divide the Durable Goods dollar quantity by the largest measurement of money, MZM:

Durable Goods Divided by MZM:

Gee, what do we find? Diminishing production relative to money creation. I could do the same thing by dividing Durable Goods with our debt, and the results look the same. What does it prove? It proves that our Durable Goods report is a fraud, when you measure production in dollars that are being devalued, then your measurement is meaningless. Thus this, and all economic statistics measured in dollars are a lie. A lie that gets bigger with the exponential growth of money and moneyness. The bottom line is don’t consent to the lies!

Demand that they stop lying to you and demand that the rule of law be righted by returning the money creation power to the people where it belongs!

Ready for more lies? Okay, here comes Personal Income and Outlays. Here the claim is that Personal Income grew by .4% in October, 3.9% year over year. And that “Consumer Spending” (Personal Outlays) grew by .1% in October, 4.7% year over year. Again, these are measurements of dollars. It says NOTHING about what you got for your dollars. And it says nothing about how long you had to work to get the items those dollars got you. Okay, let’s listen to the lies about “tame inflation:”
Personal income and spending posted additional gains in October. Inflation was tame. Personal income in October advanced 0.4 percent, following a 0.1 percent increase in September. The October rise came in higher than the market median projection for 0.3 percent. The wages & salaries component posted an even stronger 0.5 percent boost after rebounding 0.4percent the month before.

The pace of consumer spending eased in October but followed a strong gain the prior month. Personal consumption expenditures rose 0.1 percent in October, following a 0.7 percent surge in September. Market expectations were for a 0.3 percent gain. By components, personal spending was led by durables, up 0.8 percent after a 2.9 percent jump in September . On a drop in gasoline prices, nondurables decreased 0.2 percent, following a 1.0 percent jump the month before. Services rose 0.1 percent after a 0.2 percent gain in September.

Headline inflation turned negative while the core rate was soft. The headline PCE price index declined 0.1percent, following a 0.2 percent increase in September. The market expectation was for no change. The core rate firmed modestly to a 0.1 percent rise in October from no change the month before. Analysts had called for a 0.1 percent rise.

Year-on-year, headline prices are up 2.7 percent, compared to 2.9 percent in September. The core is up 1.7 percent on a year-ago basis versus 1.6 percent the month before.

The October personal income report is moderately strong, taking into account that the easing in spending came off a strong September. Within income, the robust gain in the wage & salaries component is particularly encouraging. While unemployment remains high, for consumers that are employed, the fundamentals for spending continue to improve.

While we hear the lies, we do not consent to them! “Robust gain in wage & salaries” my ass. What a whopper of a lie – your wage is relative to cost because you are paid in dollars. If you want to see a true picture of your wage, let’s divide Personal Income by MZM, our money supply, to see what the truth looks like:

Personal Income Divided by MZM:

Uh huh. Are you feeling the squeeze? Excess money production, production that benefits the few, not the many, is the root cause.

“Consumer” Sentiment just came in at a pathetic level of 64.1, down slightly from the previous month’s 64.2. Let’s chart Consumer Sentiment on the same graph as Total Consumer Loans, shall we?

Consumer Sentiment & Total Consumer Loans:

Note how Sentiment rose into the year 1999 right along with the creation of the credit bubble. Then crisis with monetary response that throws the economy past the debt saturation point and ever since Consumer Sentiment has been on a down trending path.

It doesn’t have to be like this. You don’t have to consent to living inside of a nation that indebts itself to a few narcissistic individuals – that is a most improper rule of law. And you don’t have to believe or consent to the lies being bombarded upon you nonstop from the media and those whose livings are derived from propping up an illegal and immoral system.

Listen to Bill Black calmly describe the FRAUD and what needs to happen to make it stop:

Bill Black interview begins at the 7:15 point:

Don’t consent to the lies, don’t consent to the FRAUD.

“Talk is cheap when the story is good, and the tales grow taller on down the line…

I, Nathan Martin, no longer consent to the lies.

Tuesday, November 22, 2011

Morning Update/ Market Thread 11/22 - Mission Impossible Edition…

Good Morning,

Theme Music, Maestro, if you please:

Stocks continue lower this morning with the dollar slightly higher, bonds higher, oil higher, gold & silver higher, and food commodities continue lower after breaking down from their prior ranges.

For those worried about gold, here is the daily chart once again showing that the primary and secondary uptrends are still very much in tact:

Nothing highlights what I’ve been saying about the impossible math more than the “Super Committee’s” failure to even take a bite from it. Remember, they were tasked with “saving” $1.2 trillion over 10 years, but that would not have stopped the deficits from growing, it would have only slightly slowed their growth. And that was pure fantasy because any projections they were working with were simply false as they still don’t understand the exponential function of math. The following video series should be mandatory for all politicians, economists, accountants, heck everyone:

When I say impossible math underlies our economy, impossible is exactly what I mean. Not just in the United States, but in Europe and throughout the developed world. The root of the impossible math is the way in which our money comes into being as a debt that is owed to private individuals. You see, the Super Committee cannot stop making interest payments on the now $15,000,000,000,000 debt because they are living and fed from campaign money that comes from the people who profit from those insane interest charges.

There is only one way that the Super Committee can actually accomplish their impossible mission, and that is to end the “Fed” and begin producing sovereign, non debt money. Of course doing so unrestrained would be another problem, thus they would have to create checks and balances such as are contained within Freedom’s Vision.

Any politician who says they can “create jobs” while remaining within the central banker box is simply high, they do not understand the impossible math and how the economy is saturated with debt. There is only one way to create jobs going forward, and it involves clearing out the debt saturated condition, which must be accomplished one way or the other – any plan that fails to clear the debt will fail.

Of course we still haven’t addressed step one that prevents any “Super duper stupendous committee” from success – step #1 is to restore the proper rule of law. You start down that path by prosecuting the FRAUD, which is still rampant.

Speaking of fraudsters, I have a personal message for the stinking pile of manure that is Newt Gingrich… Go F___ yourself, Newt. And while you’re at it, it is YOU who should get a job and take a bath, I can smell the immoral narcissistic stench clear across the country! For you to say that it was not the Occupiers that paid for the parks they are occupying is not only patently false, as they are tax payers who most certainly did help to pay for that park, but you illustrate exactly how it is you and your overweight pandering to central bankers that proves you would accomplish exactly nothing except deepening the problems America faces. It is YOU who needs to go get a freakin’ job, you A-hole. Perhaps a little manual labor would be good for the soul, try it. By the way, you are now clearly in the running for the Economic Edge Asshat of the Year Award – congratulations.

What a field of candidates. Newt’s immoral words and life deeds may not land him in prison, but I know that Cain probably deserves a very long prison stay indeed, and would love to see that other Asshat Award contender on trial for his sexual assaults and for using his position of power over women. Running for President? He belongs behind bars least his next victim be one of our daughters!

The first revision for Q3 GDP came in much lower than expected at 2.0%, down from 2.5%. Note in Econocomplicit’s commentary how they try to spin this positive, yet also note how the growth figures were lowered, but the inflation figures were not:
The economy got a moderate downgrade for the third quarter but the downgrade largely came from where there is the least damage to forward momentum. The Commerce Department's second estimate for third quarter GDP growth was bumped down to an increase of 2.0 percent annualized, compared to the initial estimate of 2.5 percent and to second quarter growth of 1.3 percent. Analysts had forecast a revision to 2.4 percent annualized.

The downward revision primarily was due to a downward revision to inventory investment-from plus $5.4 billion initially to minus $8.5 billion. This revision is the equivalent of a 0.43 percentage point lower contribution to GDP growth.

Minor downward revisions also were made to personal consumption, nonresidential fixed investment, residential investment, and government purchases. Net exports were revised up to minus $400.7 billion from minus $409.4 billion.

The net effects of revisions to inventories and other components (notably net exports) leave demand numbers still relatively healthy. Final sales of domestic product were unrevised from the initial estimate of 3.6 percent. Final sales to domestic purchasers were down to 3.0 percent from the original estimate of 3.2 percent annualized.

Economy-wide inflation was unrevised at 2.5 percent and compares to the second quarter rise of 2.5 percent. The market median forecast was for 2.5 percent.

Turning to current quarter strengths and weakness (as opposed to component revisions), the economy was still gaining modest momentum. The acceleration in real GDP in the third quarter primarily reflected accelerations in PCE and in nonresidential fixed investment, a smaller decrease in state and local government spending, a deceleration in imports, and an acceleration in exports that were partly offset by a larger decrease in private inventory investment.

On the news, equity futures dipped modestly. Nonetheless, the key points today are that there is no significant change in underlying demand in the third quarter and recent monthly data indicate further strengthening.

Of course that is all bumpkis. Real GDP is not only negative, but it is extremely negative. And our GDP is overstated by 40% or more because they count our deficit spending, debt owed to private bankers, as “production.” That means that GDP is really a measurement of our money(ness), not of production. Below is a chart showing supposed GDP along with our national debt in grey, and below that all the current “Fed” measurements of money supply – note how all the money adds up to debt, since all our money is debt! Then notice how our national debt, which is now $15 trillion not the $14 trillion depicted there as they can’t update their charts fast enough to keep pace (so I extended the line to reflect that), is now outpacing our GDP:

GDP/National Debt/Money Supplies (money is debt):

Now then, when you take our GDP and divide it by our money supply, you quickly understand that something not good is happening – namely that the amount of “production” for a given amount of money is diminishing rapidly:

GDP Divided by MZM:

Because our money is debt, we are boxed in. Add more money, add more debt = impossible math. Pay down your debt, you have less money = impossible math. How hard is this to understand for crying out loud!

Of course there are savvy people in politics and in banking who fully get this. It is BY DESIGN. Debt is their tool that is used to control YOU. Pointing out the impossible situation of the system they create and perpetuate does nothing until we are fully ready to remove them from power. To do that all you must do is no longer consent to their lies! I, Nathan Martin, do not consent to their lies! Say it and repeat it, it will literally set you free.

Now let’s examine today’s announcement that Corporate Profits rose by 6.5% year over year in Q3, up from the .3% prior!
Corporate profits in the third quarter grew to $1.507 trillion annualized-up from $1.470 trillion in the fourth quarter (previously $1.470) trillion). Profits in the third quarter rose an annualized 10.3 percent, following a 4.3 percent gain the quarter before (previously 4.3 percent). Profits are after tax but without inventory valuation and capital consumption adjustments. Corporate profits on a year-on-year basis advanced 6.5 percent, compared to up 0.3 percent in the second quarter.

Of course these “Corporate Profits” are complete nonsense too! They are there only due to the FRAUD. Remove the fraud, and corporate profits vanish. I’m talking about all the fraud, the mark-to-fantasy accounting, the offloading of stench filled debt onto Fannie and Freddie, the corporate shell games that are being played, the rating agency fraud, the “war on drugs” money laundering, etc., etc..

As proof of that, below is a chart showing the parabolic nature of corporate profits – they rose as the fraud rose, then for a very short time mark-to-market accounting was reimposed, profits crashed. They used their make money from nothing power to buy off Congress and the FASB, and BINGO, next thing you know mark-to-fantasy is back, and so are parabolic corporate profits:

Corporate Profits:

Gee, did your home value recover like that? How about your retirement plan? Does your budget look better than ever? How about your cost of living? To me, that chart is symbolic of the Occupy movement’s cry.

Once again, since it they who want to deceive us all with “productivity” propaganda, it’s time to revisit that very apropos Kennedy quote:
“Too much and too long, we seem to have surrendered community excellence and community values in the mere accumulation of material things. Our gross national product...if we should judge the United States of America by that - counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for those who break them. It counts the destruction of our redwoods and the loss of our natural wonder in chaotic sprawl. It counts napalm and the cost of a nuclear warhead, and armored cars for police who fight riots in our streets. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children.

Yet the gross national product does not allow for the health of our children, the quality of their education, or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages; the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything, in short, except that which makes life worthwhile. And it tells us everything about America except why we are proud that we are Americans.”
― Robert F. Kennedy

We are the many
You are the few

I, Nathan Martin, no longer consent to the lies.

Monday, November 21, 2011

Market Thread 11/21

I'm out of the area this morning, will be back this afternoon. In the mean time, please keep the daily commentary going, thank you for your contribution and participation!