SP 500 and NDX Futures Daily Charts - Back to Bubble Land

"Nothing's ever fulfilled, not until the very end. and closure. Nothing is ever over."

Rust Cohle, True Detective

Stocks have managed to rally back into bubble territory, compliments of the policy errors of the Western financial system and the acquiescence of their house servant politicians, well paid, but servants nonetheless.

There will be another financial crisis, similar to the last three, because nothing has changed.

Have a pleasant evening.

 

Raids On the Unspeakable

The Unspeakable. What is this? Surely, an eschatological image. It is the void that we encounter, you and I, underlying the announced programs, the good intentions, the unexampled and universal aspirations for the best of all possible worlds. It is the void that contradicts everything that is spoken even before the words are said; the void that gets into the language of public and official declarations at the very moment when they are pronounced, and makes them ring dead with the hollowness of the abyss. It is the void out of which Eichmann drew the punctilious exactitude of his obedience, the void which drawls in the zany violence of Flannery O'Connor's Southerners, or hypnotizes the tempted conscience in Julien Green.

It is the emptiness of "the end." Not necessarily the end of the world, but a theological point of no return, a climax of absolute finality in refusal, in equivocation, in disorder, in absurdity, which can be broken open again to truth only by miracle, by the coming of God. Yet nowhere do you despair of this miracle. You seem to say that, for you, this is precisely what it means to be a Christian; for Christian hope begins where every other hope stands frozen stiff before the face of The Unspeakable. I am glad you say this, but you will not find too many agreeing with you, even among Christians.

….The goodness of the world, stricken or not, is incontestable and definitive. If it is stricken, it is also healed in Christ. But nevertheless one of the awful facts of our age is the evidence that it is stricken indeed, stricken to the very core of its being by the presence of the Unspeakable.

Those who are at present so eager to be reconciled with the world at any price must take care not to be reconciled with it under this particular aspect: as the nest of The Unspeakable. This is what too few are willing to see….

You are not big enough to accuse the whole age effectively, but let us say you are in dissent. You are in no position to issue commands, but you can speak words of hope. Shall this be the substance of your message? Be human in this most inhuman of ages; guard the image of man for it is the image of God. You agree? Good. Then go with my blessing. But I warn you, do not expect to make many friends. As for the Unspeakable—his implacable presence will not be disturbed by a little fellow like you!

Thomas Merton, Raids on the Unspeakable

For Whom Are the Japanese Leaders Kuroda and Abe Making Their Monetary and Fiscal Policy?

The expansion of the BOJ asset purchase program was timed to start with the end of the Fed's asset purchase program.  I mean, come on.  Could it have been any more obvious?

There is no big question that the Bank of Japan has been acting in concert with the Fed for the better part of this century at least.  And politically, Japan is a client state of the US.

One of the great difficulties in recovering from the long period of Japanese economic stagnation since the collapse of their great real estate and stock market bubble has been the inability to clean up their interlocking financial system dominated by industrial combines called keiretsus and a closely associated political system run by a surprisingly well connected minority of insiders.

Beyond that I wondered why was Japan pursuing the purchase not only of domestic equities and non-sovereign paper, but foreign equities as well with their very large pension fund?  Are these intended as 'investments?'  Or are they a form of cross subsidies in support of a more global agenda?

It makes me wonder if the policy being pursued by the BOJ is not designed to help the people of Japan now, so much as to support the requests of the international banking concerns, more specifically the US Federal Reserve.

This made me wonder if Kuroda is pursuing the same type of trickle down stimulus in buying large amounts of financial paper by printing money, rather than engaging in policy actions to stimulate aggregate demand.

And there is that nasty consumption tax hike in April which tends to have a regressive effect on lower income households.  A weak yen is good for the exporters and multinationals, but is hard on small businesses and consumers. 

Although the Japanese GINI coefficient for economic equality is lower than that of the US, in terms of power Japan is a very top heavy, insider dominated society.   Their incorporation of University pedigrees into the success ladder would make the Ivy League envious.

Here is a thoughtful discussion of Japanese quantitative easing from just a few weeks ago from Sober Look.   As you can see, the consensus was running heavily against an expansion, making the surprise from BOJ the day after the Fed taper even more of a surprise.

"With wage growth remaining sluggish (particularly for non-union workers), rising import costs could undermine consumer demand - particularly in the face of higher consumption taxes. Given these headwinds, there may be sufficient political pressure to put the BoJ into a holding pattern."

I am not sure of all the specifics of what is happening in Japan, but I am becoming increasingly persuaded that the Anglo-American financial cartel and some of its client states are engaging in an intensifying currency war with regard to the international dominance of the dollar.

This extends not only to the dollar as the primary benchmark for international valuations, but also to the more compelling power that such an instrument, in the hands of a single governmentally affiliated entity, provides to those who wield it to set international and domestic policies that go far beyond mere terms of trade. 

 

So I think it is fair to ask for whom the Bank of Japan and their political leadership are making some of their policy decisions.  And further, it is incredibly naïve not to ask the same questions about the Federal Reserve and the political leadership of the US.

Money power is political power, in every sense of the word. 

Employment In Japan

It has been quite some time since I have been doing business in Japan, and I was curious to know if the culture of the 'salary man' had changed.  What is the employment picture in Japan really like for the average person?   What are things like behind the statistics put forward in the international press?

While unemployment in Japan is very low at 3.6% or so and the Labor Participation Rate is still fairly high, it looks like 'underemployment' might be something worth looking at given the slack in wage growth.  Certainly Japan is experiencing deflation, but is that a 'cause' or an effect as part of some other economic feedback loop? 

What happened to the NAIRU non-accelerating inflation rate of unemployment theory?  It is the theory put forward by Friedman and the monetarists that refers to a level of unemployment below which inflation must rise due to wage pressures.   Personally I think the growth of monopolies, the globalization of markets, and the relative political weakness of labor has knocked another dodgy economic theory into a cocked hat.

Places like the old South might have had nearly full employment, but I don't think slavery was adding seriously to wage pressures. Quite the contrary. But it may have put pressure on selective prices, like transport, whips, and chains for repression.  But this is just my opinion and I could be wrong.

Sometimes it is not always easy to find things because people tend to be very positive about their country, especially when speaking with others.  And I dislike looking at OECD statistics and other compendiums because they tend to lose quite a bit with time lag and a lack of insight past government statistics which, and I know this is hard to believe, tend to paint a pretty picture.

But I did get this in from a long time friend in Japan.

"It is difficult for many young people who are part-time or temporary, particularly the men. It is hard for them to "attract" a mate. Many couples are both employed but when they have children there is pressure to find a nursery and often times the wife cannot return to her former job. This obviously complicates the demographic conundrum. Although I do not have figures, this sort of conversation comes up even on the TV.

This is from JIJI dot com. Sorry but Japanese.

The chart shows average monthly salary after subtracting inflation for 2013 having dropped 0.5%.

According to the latest government statistics there are 33.1 million "full time employed" (seiki shain) and 20.4 million "part-time" (hi-seiki shain).

This means that the hi-seiki  非正規 or part-time/temporary account for 38% of the work force.

You can see the numbers I quote "3311" and "2042" in the second line of the page linked below.

Japanese Internal Affairs and Communication Ministry

Note:  Hi-seiki refers to any type of employment other than full-benefit employee of a company. I have also seen figures that suggest 40% of those employed earn an average of less than 3 million yen  (about $26,710 per year at current exchange rates).

Jesse's Note:

There is an English tab on the site, but unfortunately the tab goes to a different site and does not 'match up' with the Japanese page.

Here is a google translation of the relevant line on the page. 

Heisei "regular staff and employees" of the October time year 24 33,110,000 people, "non-regular staff and employees" is 20,420,007 thousand (Excel: 2985KB)

 

Gold Daily and Silver Weekly Charts - Good Morning Fiat Nam

It is a mistake to underestimate the depths of self-serving policy error to which Wall Street and the ruling elite will sink in order to kick the can down the road and maintain their positions of privilege.  Every time I think they can go no further, I am surprised.  Shame on me.

The Fed has never seen a bubble it didn't like.  And if the trickle down isn't working, keep doing the same thing, but even more.   Tempting fate doesn't begin to cover it.

There was intraday commentary here.   Although I do not mention it, there may have been a veiled message in there for the people of Switzerland, to comply and conform their domestic policies to the monied interests.

Try to remember those who have passed away on this weekend, as has been the fourteen centuries long tradition in western Christian culture on All Saints' Day, when in 610 AD Boniface IV consecrated the Pantheon in Rome to the memory of Mary and the martyrs.  And you might have a mind for those who remain in the struggle for justice and righteousness, All Souls, on the day after.  I will remember you, as always.

Quaintly foolish notions these days, I know, among those who would be as gods, or perhaps already are, at least in their own minds.

And may the odds be ever in their favour.

Have a pleasant weekend.

 

SP 500 and NDX Futures Daily Charts - The Fed Has Crossed the Rubicon

The Fed very deliberately stopped a market correction and managed to turn the equity markets around, very consciously, in order to end their taper without any negative effects to Wall Street.

Last night the Bank of Japan announced a more aggressive quantitative easing AND pledged a portion of their national pension fund to buying not only Japanese equities but also the equities of foreign markets.

The Fed and the Bank of Japan are back doing the money printing tag team and carry trades that carried the markets higher from 2002 to 2007 and helped to create the housing bubble and the subsequent financial crisis.

And it is obvious that Wall Street and the ruling elite have learned absolutely nothing. They go from crisis to crisis, with their delusions of power growing with each successful fraud. If there is another financial crisis and bailout, prosecutions may be among the least of their problems.

Right now the BOJ is exporting deflation to the US in the form of a strong dollar. This is not going to help a recovery, but Yen based printed money may help to swell paper assets.

This is a formula for disaster.

 

Bernie Sanders: Breaking Big Money's Grip on US Elections

Not likely with both major parties swilling at the Big Money troughs, during and after office.

The first step will be to get the politicians to care what the people think and want again, and not treat them with such casual disdain and contempt.



Breaking Big Money’s Grip on Elections from BillMoyers.com on Vimeo.