"Apocalypse 2012 Back On? Second Mayan Inscription Uncovered"

From ABC News:

Image credit: De Agostini/DEA Picture Library/Getty Images

Mexico’s National Institute of Anthropology and History now says Mayan ruins show a second reference to the apocalypse occurring in 2012 but said that rumors of the world ending late next year were a Western misinterpretation.

On Thursday, the institute released a statement saying that the date of the apocalypse  had been found on the carved or molded face of a brick at the Comalcalco ruin in the southern part of the country.

Most experts had previously said there was only one reference in Mayan glyphs, a stone tablet from the Tortuguero site in the Gulf coast state of Tabasco....MORE, including video

The story at The Register (we love The Register):

Boffins find new 2012 glyph on 'secret' Mayan brick

Cryptic 1300-yr-old inscription ≠ doomsday, they insist

... In a statement ahead of a planned meeting of Mayan experts, the Institute says:

Of the approximately 15,000 registered glyphic texts discovered so far in different parts of the Maya area, in only two inscriptions is there mention of 2012: Monument 6 at Tortuguero, and a fragment found at Comalcalco, Tabasco, archaeological sites relatively close together.

The Tortuguero glyph is well known, and is the source of much of the hoopla regarding the Mayan calendar and possible doomsday in 2012. The Comalcalco glyph, probably inscribed in the 7th century AD, is less commonly known and many experts doubt that it refers to December 2012 at all: it might refer to the same point in a different 394-year-long "Baktun" during the present 5,200-year long count....

...The Mexican archaeological institute seeks to downplay the significance of the expiration of the thirteenth and final Baktun of the current long count on or about December 21 next year. However its statement does say:

According to the Maya concept, every 13 baktunoob (which together account for 5,200 years) the cosmos is regenerated, completing a cycle of creation.

Which might be cause for alarm. Similarly US space agency NASA has issued several rather equivocal denials that there's any truth to the 2012 apocalypse theories, saying that while mega solar flares and/or colossal "super volcanoes" most likely won't destroy the entire Earth, they could certainly cause titanic disasters and suffering on an immense scale.

Naturally it is one of firmest editorial principles here at the Reg that we deplore this type of baseless speculation, and as such we would much prefer not to give it the oxygen of publicity. Regrettably we also have a still firmer principle that it is important to make a living, so in this case we have given the Mexican statement (translated by Google) a quick blast from the old oxy bottle anyway.

Russian Carrier, Israeli Military in Joint Exercises This Week Off Cyprus

The hell you say.
From DefenseGreece.com:
Russian navy nears Cyprus drilling zone

November 25, 2011 | Filed under: Featured News,Geopolitics

THE “Admiral Kuznetsov” class aircraft carrier is currently off the coast of Malta and heading for eastern Mediterranean from their base in the Barents Sea.

Informed sources have said that the Russian navy and Israeli military will hold joint exercises next week close to Cyprus Exclusive Economic Zone.

The exercises are slated to begin on the 28th November and last a week.

Commentators say that Russia is determined to send the message that they have invested interests in the region and will secure them.

It is understood that the aircraft carrier is carrying 24-fixed wing planes and a number of helicopters. It has also been reported in the press that the Russian navy may request to use port facilities at Limassol....MORE

HT: A Sclerotic at War who into's with:

(This piece leaves me speechless…. Are the Russians actually IN on the plan to weaken Iran and just playing the good cop? – JW)

"Warning to Germany and France: Build a Barrier at the Alps"

David Goldman was global head of fixed income research at Bank of America (2002-2005) and global head of credit strategy for Credit Suisse (1998-2002). In 2001, he was elected to Institutional Investor magazine's All-America Fixed Income Research Team.-Wikipedia

Goldman blogs at the Asia Times:

As I said on Larry Kudlow’s CNBC program Nov. 21, France and Germany need a new Maginot line somewhere around Nice.

Germany’s otherwise sober and intelligent Angela Merkel is in flight forward, as I warned in a Nov. 11 Macrostrategy report (still available to the public, but soon to be restricted to paying customers). Germany is simply not big enough to bail out the backward economies of southern Europe, as today’s undersubscribed Bund action should make clear. The right solution is to throw the laggards under the bus, and draw the line at the Alps, ring-fencing France and Belgium.

As I explained in the cited report, you simply can’t do very much for a country a third of whose economy is black market. Italy and Greece are comparable to Turkey: the state simply doesn’t see one in three transactions. The entire political culture down to the capillary level, down to the smallest Sicilian village, is thoroughly corrupt.

And southern Europe is dying a slow demographic death as well. Long term, the budget problems of Spain, Italy, and Greece are insoluble, so you might as well put them through bankruptcy now.

The political culture of those countries is corrupt from top to bottom. To get rid of the fleas, you have to kill the dog, that is, starve the state. The obvious way to do this is to auction of all important state assets as well as the notionally-private banking system to foreigners, so that the politicians will loose access to the fountains of corruption. To make this perfectly clear: what is required is not an austerity program, but a thorough-going revolution in economic and social life, a transformation of the way of doing things.

The politicians will never agree to this, because any workable solution begins by destroying their livelihoods....MORE

As Merkozy trace Hannibal's route in reverse....they hope to find time to regroup at the line of the Swiss National Redoubt.



I Believe in Merkels (Where You From You Sexy Thing)

...Miracles right before my eyes
You sexy thing got me hypnotised
Don't stop what ya' doing
What ya' doing to me
My angel from above lying next to me
How did ya' know that I'd be the one
Been a long time coming only just begun
Doing all the things that makes my heart sing
Keep doing what you're doing you sexy thing...

From FT Alphaville, some longer-form blogging: 
[Something for the weekend] Do you believe in Merkels?

At first sight, this looks mad. Lending to the UK government, in charge of the clapped-out British economy, now returns less than lending to Europe’s most successful country.  Worse still, the yields on gilts are measured in sterling, a chronically weak currency, so not only does your money earn less, you’ll be repaid in something which history says will have been devalued by the time you get it back. Oh, and by the way, inflation is 3 per cent above the yield, making the internal devaluation painful, too.

Something is seriously awry here, and two events this week offer clues to why German government 10-year paper yields more than the equivalent UK stock. On Wednesday the markets were spooked by the failure of an auction of 10-year German debt. Those in this arcane world struggled to understand what it meant, so there’s little hope for the rest of us. It’s either bad news, or very bad news, probably depending on whether you’re short of German bonds....MORE

Ladies and gentlemen, Hot Chocolate!


On second thought, maybe Alphaville's title refers to the 1980 Miracle on Ice.

If that is the case I apologize for any nightmares induced by the image of the German Chancellor being anything but an asexual Head-of-Government.
‘Germans fed up with Eurobondage’

Swiss Banking: "Safra to Buy Sarasin Stake From Rabobank" (BSAN)

Edmond would be proud.
And what's up with Julius Baer's reluctance to up the ante?
From Bloomberg:

Safra Group, founded in the Syrian city of Aleppo in the 19th century, agreed to buy Rabobank Groep’s controlling stake in Bank Sarasin & Cie. (BSAN) AG for more than 1 billion Swiss francs ($1.1 billion) to expand private banking in Europe, the Middle East and Asia.

Safra will pay 36 francs a piece for B shares, about 5 percent more than the price of Sarasin’s stock at the market close. Together with the purchase of A shares, that will give Safra 68.6 percent of the voting rights and a 46 percent equity interest, the companies said today in a statement. The transaction is valued at more than 1 billion francs, said Fransce Verdeuzeldonk, a Rabobank spokeswoman.

The deal provides “Sarasin with additional distribution channels for its products as well as access to new growth markets,” it said in the statement. “Sarasin has significant private banking presences in key European markets, the Middle East and Asia."...MORE

From SwissInfo:
Safra buys Sarasin majority stake

Here's the joint press release via Sarasin, note the traditional Swiss modesty: 

Bank Sarasin & Cie AG : Safra Group to acquire majority interest in highly regarded Bank Sarasin

Previously:
Swiss Banking: Baer May Buy Rabobank's Sarasin Stake

Market Moves Further Into Oversold Territory

This could end up being some sick reductio ad absurdum comic bit:

"On Wall Street the Dow Jones Average was further oversold for the sixteenth month in a row and now stands at 8"

DJIA closing down 25.61 (0.23%), S&P down 3.12 (0.27%) in abbreviated trade.
From Slope of Hope:

The market has pushed into one of the most short-term oversold states that I have seen in quite some time. Almost every ETF I follow is now in a “very oversold” state with RSI (2) readings below 5 and over half below 1 – a rarity indeed.

So, now is the time that I want to be aggressive on the long side, but only for a few trading days. Conditions like the aforementioned almost always work themselves back to mean-reversion and I want to be a participant when the short-term occurs. I already have several trades on in both of my options strategies and plan on adding several more over the next few trading days, that is unless we see an enormous bounce before the opening bell Friday, which I think is highly doubtful.

It is during times like these that wealth is truly built.

I think Tom Sosnoff says it best - ”The trend is your friend but the fade is the ultimate wealth builder”...MORE

Earlier this week:

Equities: "Back to Oversold" (DIA; SPY; XLF)

Indian Stock Market: East is East and West is West Except When Correlation r=.85 at the 95% Confidence Level

I just guessed at the .85. If we do more posts on the Indian Markets I'll run the program.
As for Kipling, I think the closest he ever got to market commentary was "The Female of the Species":

When the Himalayan peasant meets the he-bear in his pride,
He shouts to scare the monster, who will often turn aside.
But the she-bear thus accosted, rends the peasant tooth and nail,
For the female of the species is more deadly than the male.

Lifted in toto from Bespoke Investment Group:

India's Stock Market Tanks

As shown below, India's SENSEX (the main stock market index in India) has completely fallen out of bed over the past few weeks.  Since gapping sharply higher on October 27th, the index is down 12.33%.  Today the SENSEX experienced a major breakdown as it collapsed below key support levels that were formed by the index's August and early October lows.  This breakdown has many saying "Look out belooooooow!"

The Most Foreseeable Financial Collapse in History: Top Ten Commentator Quotes

From Market Oracle: 
The Coming Global Financial Collapse Quotes That Will Make Your Hair Stand Up 

...The following are 17 quotes about the coming global financial collapse that will make your hair stand up....

#1 Credit Suisse's Fixed Income Research unit: "We seem to have entered the last days of the euro as we currently know it. That doesn’t make a break-up very likely, but it does mean some extraordinary things will almost certainly need to happen – probably by mid-January – to prevent the progressive closure of all the euro zone sovereign bond markets, potentially accompanied by escalating runs on even the strongest banks."

#2 Willem Buiter, chief economist at Citigroup: "Time is running out fast. I think we have maybe a few months – it could be weeks, it could be days – before there is a material risk of a fundamentally unnecessary default by a country like Spain or Italy which would be a financial catastrophe dragging the European banking system and North America with it."

#3 Jim Reid of Deutsche Bank: "If you don't think Merkel's tone will change then our investment advice is to dig a hole in the ground and hide."

#4 David Rosenberg, a senior economist at Gluskin Sheff in Toronto: "Lenders are finding it difficult to finance their day-to-day operations with short-term funding. This is a lot like 2008 but with more twists."

#5 Christian Stracke, the head of credit research for Pimco: "This is just a repeat of what we saw in 2008, when everyone wanted to see toxic assets off the banks’ balance sheets"

#6 Paul Krugman of the New York Times: "At this point I’d guess soaring rates on Italian debt leading to a gigantic bank run, both because of solvency fears about Italian banks given a default and because of fear that Italy will end up leaving the euro. This then leads to emergency bank closing, and once that happens, a decision to drop the euro and install the new lira. Next stop, France."

#7 Paul Hickey of Bespoke Investment Group: "More and more, we are hearing anecdotal comments from individual and professionals that this is the most difficult environment they have ever experienced as the market is like a fish flopping around after being taken out of the water."

#8 Bob Janjuah of Nomura International: "Germany appears to be adamant that full political and fiscal integration over the next decade (nothing substantive will happen over the short term, in my view) is the only option, and ECB monetisation is no longer possible. I really think it is that clear and simple. And if I am wrong, and the ECB does a U-turn and agrees to unlimited monetisation, I will simply wait for the inevitable knee-jerk rally to fade before reloading my short risk positions. Even if Germany and the ECB somehow agree to unlimited monetisation I believe it will do nothing to fix the insolvency and lack of growth in the eurozone. It will just result in a major destruction of the ECB?s balance sheet which will force an ECB recap. At that point, I think Germany and its northern partners would walk away. Markets always want short, sharp, simple solutions."

#9 Dan Akerson, CEO of General Motors: "The ’08 recession, which was a credit bubble that manifested itself through primarily the real estate market, that was a serious stress....This is much more serious."

#10 Francesco Garzarelli of Goldman Sachs: "Pressures on Euro area sovereign bond markets have progressively intensified and spread like a wildfire."

Here's a special bonus quote:

#11 Jim Rogers: "In 2002 it was bad, in 2008 it was worse and 2012 or 2013 is going to be worse still – be careful"

...MORE

Contagion: "Interventions and bank queues in Eastern Europe"

This is a couple days late but I wanted to have it on the blog as a personal bookmark.
I keep thinking about something that one of America's best autodidactic historians said in one of her worst books:*

A phenomenon noticeable throughout history regardless of place or period is the pursuit by governments of policies contrary to their own interests. Mankind, it seems, makes a poorer performance of government than of almost any other human activity. In this sphere, wisdom, which may be defined as the exercise of judgment acting on experience, common sense and available information, is less operative and more frustrated that it should be. Why do holders of high office so often act contrary to the way reason points and enlightened self-interest suggests? Why does intelligent mental process seem so often not to function?

-Barbara Tuchman, The March of Folly: From Troy to Vietnam, 1984

The blog first used it in 2008's "The Guns of August: Russia Breaks Ties With Nato; Sends Carrier to Syria; Surrounds Georgian Port" which I intro'd:

In Barbara Tuchman's history of the build-up to World War I, the themes that came through the strongest was how inexorable the process was. And how many opportunities to stop it were blown.
For some months I've had an edge-of-consciousness feeling that comes out of my (limited) understanding of that summer 94 years ago...

referring to one of her best books, "The Guns of August" which garnered her some hardware.

Anyhoo, here's FT Alphaville:

Reuters is reporting that Poland’s central bank stepped into the spot market for the fourth time in less than three months on Wednesday to help support the zloty versus the euro, which was once again nearing levels last seen in 2009.
But the Bank’s intervention seems to be ever less detectable in terms of price trends:

Investors are generally worried about Poland’s and the wider region’s exposure to a European recession, as well as squeezes on banks and credit due to the sovereign debt crisis in the eurozone.
Develeraging by eurozone banks in Eastern Europe is already having negative effects across the region.
On Wednesday there were reports of queues forming outside Latvia’s Krājbanka (H/T @finansakrobat), as per this YouTube clip:



Bloomberg had reported on Tuesday that as much as 100m lati ($191m) may be missing from the bank.

The shortfalls come on the back of the liquidation of Lithuania’s Bankas Snoras, according to the report. Depositors were told on Tuesday that they would only be able to withdraw as much as 50 lati from ATMs starting on Wednesday for the next two to three days, depending on how the Lithuanian government proceeds with Snoras....MORE

*I'm not kidding about the "Self-taught" stuff. She taught herself Old French so she could go to the original sources while writing A Distant Mirror: The Calamitous Fourteenth Century.
This is probably a good place to put on my happy face and note "Tuchman's Law":

Disaster is rarely as pervasive as it seems from recorded accounts. The fact of being on the record makes it appear continuous and ubiquitous whereas it is more likely to have been sporadic both in time and place. Besides, persistence of the normal is usually greater than the effect of the disturbance, as we know from our own times. After absorbing the news of today, one expects to face a world consisting entirely of strikes, crimes, power failures, broken water mains, stalled trains, school shutdowns, muggers, drug addicts, neo-Nazis, and rapists. The fact is that one can come home in the evening, on a lucky day, without having encountered more than one or two of these phenomena. This has led me to formulate Tuchman's Law, as follows: "The fact of being reported multiplies the apparent extent of any deplorable development by five- to tenfold (or any figure the reader would care to supply)."

Aircraft Carrier CVN-77 Parks Next Door To Syria Just As US Urges Americans To Leave Country "Immediately"

In our November 11 post "Iran Going on War Footing (and where's the U.S. Navy?)" I commented:

...You'll note no large ships in the Mediterranean which is odd.
Also, it seems that a lot of the big boats are back in port, refueling, victualing, arming etc.

Well, that's changed.
From ZeroHedge:

Yesterday we reported that the Arab League (with European and US support) are preparing to institute a no fly zone over Syria. Today, we get an escalation which confirms we may be on the edge. Just out from CBS: "The U.S. Embassy in Damascus urged its citizens in Syria to depart "immediately," and Turkey's foreign ministry urged Turkish pilgrims to opt for flights to return home from Saudi Arabia to avoid traveling through Syria." But probably the most damning evidence that the "western world" is about to do the unthinkable and invade Syria, and in the process force Iran to retaliate, is the weekly naval update from Stratfor, which always has some very interesting if always controversial view on geopolitics, where we find that for the first time in many months, CVN 77 George H.W. Bush has left its traditional theater of operations just off the Straits of Hormuz, a critical choke point, where it traditionally accompanies the Stennis, and has parked... right next to Syria.
From Stratfor:

(click to enlarge)

And from CBS...MORE

Eating Big Bird

No, this isn't part of our #OccupySesameStreet series.

Serve yourself (AP)

From the Washington Post's Joel Achenbach, Dec. 11, 2005:

For Thanksgiving dinner this year, we gave everyone an acetylene blowtorch and a welder's helmet, and passed around hunks of raw meat. It was thrilling! We had the traditional turkey, of course, plus goat, bobcat and some pigeon that I thought tasted exactly like squirrel. Some of the guests never quite mastered their torches, and at one point the curtains caught fire, but it was all enchantingly dramatic.

That's everyone's goal when designing a holiday meal these days: Drama. Excitement. The wow factor. It's not a meal -- it's a performance. You don't have dinner guests, you have witnesses. Everyone who leaves the table at the end of the feast must be not only satiated, but also emotionally spent. You want your holiday dinner guests to say, "I can't remember when I've had such an intense, weird and utterly harrowing meal."

Simply roasting a large turkey in the oven and serving 150 or 200 side dishes isn't going to cut it in today's highly competitive culinary culture. We're past the point where repulsive gluttony by itself will make a holiday meal memorable. You need an actual sense of danger. This is the appeal of those turkey deep-fryers. Why roast a turkey in a conventional oven when you can lower it into a giant spattering vat of extremely hazardous billion-degree oil and have your own near-Chernobyl experience?

It's hard to believe how much holiday meals have changed since the 1960s and 1970s, when everyone served the same few things: turkey, mashed potatoes, stuffing, gravy, maybe some sweet potatoes and green beans, and definitely some jellied cranberry sauce from a can. An experimental, risk-taking chef would switch to whole-berry cranberry sauce from a can. Only two things mattered: People had to be able to eat themselves into a coma, and the white meat had to be moist.

The baseline against which "moist" was measured was basically cardboard. This period in history is known as the Dry Meat Era. Turkeys didn't have such large breasts back then, and it took a lot of cooking savvy and intercessory prayer to keep them from drying out. This caused chronic anxiety among mothers, who in those days were led to think that their entire value to society depended upon retaining moisture in the white meat of a turkey. They tried all kinds of cockamamie schemes -- cooking the bird upside down, using a syringe to inject butter and lard and bacon grease and cream rinse and whatnot directly into the breast, and so on -- and when the bird was served, these mothers would have a hopeful, but fundamentally pained, expression. This was the big moment.

There you'd be, hoping to please your mom, and you'd put a forkful in your mouth, and start to pay a compliment, but all the fluid in your mouth would have vanished. Your mom, agonized, would say, "Is the white meat . . . overdone?" Finally, heroically, you'd manage to utter a single, barely audible word: "Powder."

Then, circa 1984, the turkeys got breastier, and people also discovered that they could obtain turkeys that hadn't been frozen since the Paleolithic age. In the 1990s the economy took off, and folks started buying ovens the size of a toolshed. The typical 14-pound holiday turkey looked miniature in those huge ovens, so people began preparing 20-pound monsters, then 26 pounds, then 48 pounds, and then finally the standard holiday bird became something you had to wheel around on a dolly....MORE

All the best to you and yours, half day Friday.

 I was creeped me out the
first time I saw this on the show,
now it's kinda grown on me

Saaay, One of Our Coal Mine Canaries Wasn't Dead After All and Appears to Be Trying to Get to its Feet (FSLR)

One of the things I do unconsciously [we'll pass on that high hanging curve ball -ed] is note the action in the more speculative names versus those at the ultramarine end of the spectrum.

Today First Solar was up a couple bucks while the DJIA was down 200.

This isn't nearly as foolproof as our 'What's on TV Timing Model' (backtested to August) but has shown some skill in forecasting the overall market with a 1 to 5 day lead time.

Fairly wide error bars so your mileage may vary etc, but for what it's worth here's today's action via Yahoo Finance:

"Stephen Leeb - Expect QE3, QE4 and 40% to 50% Inflation"

Stephen Leeb PhD's bio at Leeb Capital Management says modestly:

Dr. Stephen Leeb is a recognized authority on the stock market, macroeconomic trends and commodities, especially oil and precious metals. As Chairman and Chief Investment Officer of Leeb Capital Management, Dr. Leeb combines his knowledge of macro-economic trends and current market conditions with detailed information about specific companies he follows in order to guide the Committee's investment decisions....

His natural resource picks tend to outperform on the upside and underperform on the downside for a net underperformance since inception.

From KingWorldNews:

...“It’s a very serous situation and those are the kinds of things, I believe, the Fed is looking at that are likely to motivate further easing, QE3, QE4 and what not.  With all of these problems, for all the willingness to ease, the dollar is still standing out as the world’s reserve currency.

Now if the dollar, with all of these problems is the best paper currency you can turn to, you better not miss out on having gold and other precious metals in your portfolio.  The dollar is no shelter from any storm that we’re likely to experience.”

When asked about Thanksgiving dinner for the average family being 13% more expensive this year, Leeb remarked, “Japan, in the aftermath of World War II, their inflation reached 40%.  To deal with so many things you’re likely dealing with inflation that is going to be the highest in American history.  If you told me 40 or 50% (inflation), I think I might be more relieved than terrified.”...MORE

He could be right about the hyperinflation but not yet.
See also how close his thinking is to that of someone who runs in very different circles:
UPDATED: Uh oh: "Preserving the EU from the Destruction of the Euro" (Europe’s Banking System Could End Up Shut for Days)

"Code red: Department of Homeland Security warns of deadly threat ..."

"...Turkey fryers!"

This may be an example of what the military calls 'mission creep'.
Or just creepy.
Who are these people?

From the Daily Mail:

It's at the forefront of the war on terror - and now it's declaring war on another menace: turkey fryers.

The Department of Homeland Security has issued a timely pre-Thanksgiving warning on the dangers of the large deep fat fryers.
On the official DHS Twitter it asks: 'How dangerous can turkey fryers be?'

Scroll down for video

Ready to blow: The partially frozen turkey is dropped into an overfilled deep fat fryers at the 

required 300 degree temperature

Helpfully, it adds: 'Make sure the turkey is completely thawed before placing in a fryer, or this may happen.'

It then links to a video posted by safetyathome.com, the Washington Examiner reports.
The DHS also tweeted on Tuesday: 'Use turkey fryers outdoors at a safe distance from buildings....MORE

If you see something, say something.

Big Sister is Watching

Equities: "Back to Oversold" (DIA; SPY; XLF)

In a couple minutes they're going to get even more oversold.

From Bespoke Investment Group (click through for the sector trading range charts):

As of yesterday's close, the S&P 500 and all ten of its sectors were trading back below their 50-day moving averages.  As shown below, the Telecom sector is currently the only one trading in oversold territory (more than one standard deviation below its 50-day), but there will likely be quite a few more after today's open since futures are pointed lower once again.  Financials, Utilities and Health Care are the next closest to oversold.  Energy, Industrials and Consumer Staples are the closest to their 50-days.

MF Global: Group Files Freedom of Information Act Request on All Contacts Between Timothy Geithner and Jon Corzine

Citizens United, where have I heard that name?
It looks like these folks are going on a political fishing expedition.

From CU:

Citizens United sent a FOIA request to the Treasury Department 

today to see how much influence Jon Corzine has had in shaping 

our country’s economic policy under President Obama and Secretary Geithner.  


Full letter below...(Scribd)

HT: the Detroit News 

This might be interesting, stay tuned.

"Phase Shift" - JP Morgan Downgrades All Commodities To "Sell"

Holy crap!
Now the question is: Are they buying or selling?
[you are so suspicious -ed]

Oddly enough we had just mentioned JPM's Head of Global Commodities, Blythe Masters, yesterday.
[don't mention the coal trades -ed]

Here's ZeroHedge with the story:

If the ECB will not take the hint, JPM will bring the mountain to Mohammed. Or something. In a note just released by JPM's Colun Fenton, the firm has downgraded the entire commodity complex to "underweight" (yes, that includes gold). The reasoning? It is all the Supercommittee's fault. It also likely has nothing to do with the fact that JPM was selling commodities to clients all through this run up, and is now in finally buying, in anticipation of ECB printing and Fed's LSAP. Full report attached.
Summary:

• The US Supercommittee’s failure changes risk outlook: the primary implication is damage to confidence in the US’ seriousness of purpose and the cost of that attitude. Markets must price risk of more credit rating cuts.
• US public debt is $15Tn (100% of GDP) and growing: Since S&P cut the US sovereign credit rating four months ago, the US public debt has grown by $455Bn, an amount larger than Greece’s sovereign debt.
• Industrial metals and softs are deteriorating rapidly: incremental damage in physical metal and crop prices has unfolded worldwide since
  Thursday, when it became clear the Supercommittee would likely fail.
• Change in view: Policy failures in the US and Europe have darkened the 6M outlook, forcing us to downgrade commodities to underweight. We expect outright TR losses near-term and see greater value in bonds

Full report

"Farm belt rage over MF Global could chill markets"

Combining nitwitted and possibly nefarious activities with the Ag economy, this is my kind of story
From Reuters:

When the CME Group pledged $300 million of its own money to help former MF Global customers get their cash back faster, the exchange was likely thinking of customers like Kansas cattle rancher Tim Rietzke.

Fed up and frustrated with his broker's collapse and what he sees as the CME's slow efforts to help him retrieve $30,000 in stranded capital, Rietzke says his faith in the futures industry has been shaken to its core.
"I would be hedging some feeder cattle right now, but I'm not going to do it. I'm leaving them exposed to the cash market and I don't like that," Rietzke said.

Rietzke may reside far from the trading pit in Chicago, but he and thousands of other ranchers and farmers across the country are at the heart of futures trading.

With billions of their dollars locked up by MF Global's October 31 bankruptcy filing, they are a key voice in determining if and when the futures business regains its poise and reputation.
"I have no confidence in the market, because it could happen at any other brokerage," Rietzke told Reuters from his 8,000 acre ranch near the southwest Kansas town of Coldwater.

Dozens of other market participants, most of them smaller introducing brokers or independent traders, say the painful lesson of MF Global is forcing them to reconsider a livelihood in the market and how they hedge future crops and livestock.

Some, like Rietzke, could reduce their hedging, or cut back on day-trading; others may take up trading exchange-traded funds (ETF) that track commodity prices, but are backed by a brokerage insurance fund by securities regulators.

While trading activity in New York and Chicago has recovered following a slump immediately after MF Global's collapse, exchange officials and experts fear the crisis -- as well as its messy, protracted aftermath -- may have a chilling effect on the markets for months or years.

As the symbolic figurehead of the futures universe thanks to its ownership of both the Chicago Board of Trade and the New York Mercantile Exchange, the world's biggest agricultural and energy markets, it is the CME Group that -- to many traders -- bears an enormous burden for making things right....MORE

Mr. Reitzke is not the only person to think there may be deep structural problems in the futures markets.
In a widely circulated letter, CME Introducing Broker Ann Barnhardt said last week:

BCM Has Ceased Operations (Part 1)

Posted by Ann Barnhardt - November 17, AD 2011 10:27 AM MST

 

Dear Clients, Industry Colleagues and Friends of Barnhardt Capital Management,

It is with regret and unflinching moral certainty that I announce that Barnhardt Capital Management has ceased operations. After six years of operating as an independent introducing brokerage, and eight years of employment as a broker before that, I found myself, this morning, for the first time since I was 20 years old, watching the futures and options markets open not as a participant, but as a mere spectator.

The reason for my decision to pull the plug was excruciatingly simple: I could no longer tell my clients that their monies and positions were safe in the futures and options markets – because they are not. And this goes not just for my clients, but for every futures and options account in the United States. The entire system has been utterly destroyed by the MF Global collapse. Given this sad reality, I could not in good conscience take one more step as a commodity broker, soliciting trades that I knew were unsafe or holding funds that I knew to be in jeopardy.

The futures markets are very highly-leveraged and thus require an exceptionally firm base upon which to function. That base was the sacrosanct segregation of customer funds from clearing firm capital, with additional emergency financial backing provided by the exchanges themselves. Up until a few weeks ago, that base existed, and had worked flawlessly. Firms came and went, with some imploding in spectacular fashion. Whenever a firm failure happened, the customer funds were intact and the exchanges would step in to backstop everything and keep customers 100% liquid – even as their clearing firm collapsed and was quickly replaced by another firm within the system.

Everything changed just a few short weeks ago. A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm. Let’s not sugar-coat this or make this crime seem “complex” and “abstract” by drowning ourselves in six-dollar words and uber-technical jargon. Jon Corzine STOLE the customer cash at MF Global. Knowing Jon Corzine, and knowing the abject lawlessness and contempt for humanity of the Marxist Obama regime and its cronies, this is not really a surprise. What was a surprise was the reaction of the exchanges and regulators. Their reaction has been to take a bad situation and make it orders of magnitude worse. Specifically, they froze customers out of their accounts WHILE THE MARKETS CONTINUED TO TRADE, refusing to even allow them to liquidate.

This is unfathomable. The risk exposure precedent that has been set is completely intolerable and has destroyed the entire industry paradigm. No informed person can continue to engage these markets, and no moral person can continue to broker or facilitate customer engagement in what is now a massive game of Russian Roulette.

I have learned over the last week that MF Global is almost certainly the mere tip of the iceberg. There is massive industry-wide exposure to European sovereign junk debt. While other firms may not be as heavily leveraged as Corzine had MFG leveraged, and it is now thought that MFG’s leverage may have been in excess of 100:1, they are still suicidally leveraged and will likely stand massive, unmeetable collateral calls in the coming days and weeks as Europe inevitably collapses. I now suspect that the reason the Chicago Mercantile Exchange did not immediately step in to backstop the MFG implosion was because they knew and know that if they backstopped MFG, they would then be expected to backstop all of the other firms in the system when the failures began to cascade – and there simply isn’t that much money in the entire system. In short, the problem is a SYSTEMIC problem, not merely isolated to one firm.
Continued . . . .

Société Générale's Albert Edwards on Income Inequality and Serial Bubble Blowers (Nov. 23, 2011)

Following up on yesterday's "Société Générale's Albert Edwards: "Maybe It’s Time to Occupy the Federal Reserve" (Nov. 22. 2011)".

I have a suspicion the folks at Alphaville are fond of Albert.

One of the clues was their 2010 post, "Société Générale's Albert Edwards: We are all Japanese Now (July, 2010)" which began:

FT Alphaville Albert Edwards.

Here's the latest, the annotations are as good as the SocGen note:

Central bankers: pursued by a bear

That is US and UK central bankers pursued by über bear Albert Edwards of Société Générale.
Edwards is rather peeved that researchers at the Federal Reserve seem to have concluded that the Fed wasn’t responsible for the housing boom that has turned into the biggest bust since the 1930s. He would like to know if these are the same researchers who in 2005 that there was no housing bubble at all. But what he wants to know above all else is:

Were the US & UK central banks complicit in robbing the middle classes?

Before getting into the guts of his argument, here’s a bit of intro:

Ben Bernanke’s recent speech at the American Economic Association made me feel sick. Like Alan Greenspan, he is still in denial. The pigmies that populate the political and monetary elites prefer to genuflect to the court of public opinion in a pathetic attempt to deflect blame from their own gross and unforgivable incompetence.

The US and UK have seen a huge rise in inequality over the last two decades, as growth in national income has been diverted almost exclusively to the top income earners (see chart below). The middle classes have seen median real incomes stagnate over that period and, as a consequence, corporate margins and profits have boomed.

Some recent reading has got me thinking as to whether the US and UK central banks were actively complicit in an aggressive re-distributive policy benefiting the very rich. Indeed, it has been amazing how little political backlash there has been against the stagnation of ordinary people’s earnings in the US and UK. Did central banks, in creating housing bubbles, help distract middle class attention from this re-distributive policy by allowing them to keep consuming via equity extraction?

The above summed up in graphical format:

...MORE


Here's the prior note that Mr. Edwards references:

Albert Edwards, Societe Generale: "Theft! Were the US & UK central banks complicit in robbing the middle classes?"

Longshoremans Union Slaps Down Occupy Movement

Following up on yesterday's "Occupy Oakland Calls for TOTAL WEST COAST PORT SHUTDOWN ON 12/12".
This isn't "On the Waterfront".
A west coast longshoreman can, with overtime, make over $100,000 per year.
From The Journal of Commerce:

Protestors will have to attempt Dec. 12 shutdown without ILWU support 

The Occupy Movement is calling for a shutdown of all West Coast ports on Dec. 12, but they will have to pursue their goal without the cooperation of the powerful International Longshore and Warehouse Union.

The movement's declaration comes about three weeks after thousands of Occupy Oakland protestors halted nighttime operations at the Port of Oakland on Nov. 2. The ILWU voiced support for the Oakland protest, but a letter from the ILWU Coast Committee in San Francisco to all longshore locals on the West Coast shows a position shift:

“To be clear, the ILWU, the Coast Longshore Division and Local 21 are not coordinating independently or in conjunction with any self-proclaimed organization or group to shut down any port or terminal, particularly as it related to our dispute with EGT in Longview (Wash).”

In fact, the ILWU Coast Committee appears perturbed that groups outside of the union “intent on driving their own agendas” are using ILWU issues to pursue their own goals.

The ILWU considers its dispute with EGT, which is attempting to open a grain terminal in Longview, Wash., with the use of non-ILWU labor, to be a crucial issue for the union, but the ILWU does not want outside groups using that issue to attract support from the union rank and file for a ports shutdown.

“Other social media groups that pretend to be ILWU-related but are in no way sanctioned or informed by the elected leadership are publicly trying to link the Coast Longshore Division’s primary labor dispute with EGT in Longview to the call for a ‘shut down’ of the West Coast ports,” the letter stated....MORE

In the EGT dispute the ILWU is trying to keep a contractor who's employees are repped by another union, the International Union of Operating Engineers, out of the picture.
Dues baby, dues!