Would the world be surprised if Kim Jong-il nuked Beijing?

Would the world be surprised if Kim Jong-il nuked Beijing?

The USA and the free world should once again consider restricting technology transfer to China because China is responsible for the MAD DOG Kim Jong-il. The fact that the mad dog remains in power shows that China also has a streak of insanity. China apparently has dangerous plans and should be cut off before it is too late.

World Markets:
North Korea did not try to start a nuclear war this past weekend so world markets were open again to start another week without criminally insane communist tyrants blowing up somebody. N. Korea tells the world that Communist China is also an unstable mental case. China would rather have the N. Korean's starving and a behaving like a junk-yard dog than have a free unified Korea as a neighbor. The South Korean's would gladly ask American troops to leave if China rather than N. Korea was its neighbor. America would gladly leave S. Korea if peace were restored to the region. But China itself seems infected by mad dog Kim Jong-il and together with the Russians, China continues to harass free people on the Asian coastal islands. Why can't China stop its military imperialism in the region and become a trustworthy free world trading partner instead?

Wouldn't China be surprised if an insane Kim Jong-il quietly decided to nuke Beijing in revenge for brutally using the Koreans all these years as a buffer against what they now realize would have been years with food and prosperity. N. Korea has nothing to lose if they nuke China because China has kept N. Korea starving the way the USSR kept Eastern Europe starving. If the Ukraine had nuclear tipped missiles no doubt Russia would have gone up in clouds of radioactive dust by now.

Economic Calendar
Last week
PCE Prices - Core Oct at 0% same as last month. Not good the goal is up +0.2%per month
Durable Orders Oct declines -3.3% after being up 3.5% last month. Bad
Durable Orders -ex transportation Oct down -2.7% after being down -2.4%last month. Very bad
Initial Claims 11/20 at 407K improved from 435K last month. Still very bad
Continuing Claims 11/13 now 4182K was 4295K. still very bad as people drop off unemployment rolls with no jobs.
Michigan Sentiment - Final Nov 71.6 up from 69.3. Still very low.
New Home Sales Oct were 283K down from 307K last month. Very bad
FHFA Home Price Index (q/q) Q3 dropped -1.6% after improving 0.9% last month. Under water and worse yet.
Crude Inventories 11/20 increased 1M. This is good and refiners have increased gasoline production so prices should come down again.

This Week
Nov 30 9:00 AM Case-Shiller 20-city Index Sep -
Nov 30 9:45 AM Chicago PMI Nov
Nov 30 10:00 AM Consumer Confidence Nov

Dec 1 7:00 AM MBA Mortgage Applications 11/26
Dec 1 7:30 AM Challenger Job Cuts (y/y) Nov
Dec 1 8:15 AM ADP Employment Report Nov
Dec 1 8:30 AM Productivity-Rev. Q3
Dec 1 8:30 AM Unit Labor Costs Q3
Dec 1 10:00 AM ISM Index Nov
Dec 1 10:00 AM Construction Spending Oct
Dec 1 10:30 AM Crude Inventories 11/27 -
Dec 1 2:00 PM Auto Sales Nov
Dec 1 2:00 PM Truck Sales Nov
Dec 1 2:00 PM Fed's Beige Book Dec

Dec 2 8:30 AM Continuing Claims 11/20
Dec 2 8:30 AM Initial Claims 11/27
Dec 2 10:00 AM Pending Home Sales Oct

Dec 3 8:30 AM Nonfarm Payrolls Nov
Dec 3 8:30 AM Nonfarm Private Payrolls Nov
Dec 3 8:30 AM Unemployment Rate Nov
Dec 3 8:30 AM Hourly Earnings Nov
Dec 3 8:30 AM Average Workweek Nov
Dec 3 10:00 AM Factory Orders Oct
Dec 3 10:00 AM ISM Services Nov


Market Outlook Nov 29, 2010
This past year seems like a cross between 2003 and 1975. 2003 ended the year with the funds buying feverishly to make their 4th quarter bottom line look good and then the market plunged and went horizontal for six months. The market was erratic and Americans left investing in the stock market in droves. By the time President Reagan (the gipper) was elected in 1982 two thirds of former American investors had given up on the American stock market.

Friday the market gave up most of the gains for the week. The volatility index continues low and shows complacency with all the chaos of the world today. Bulls vastly outnumber bears and bears were getting squeezed hard. A major short squeeze could very well be what was driving the market up. The shorts panicked and covered their shorts. Usually the high bull to bear ratio like the one we have now is a sign of a topped out market.

Based on the cash flow out of the market it looks like at least one or more additional consolidation periods may be needed for the bull market to resume. Without real economic growth there is a limit to how much further corporate profits can rise. Obama socialism makes Americans fearful that things can only get worse. Obama socialists and the democrats still have not gotten the message. Americans do not like the socialist pickpockets much less airport gropers or sexual deviates allowed in the military. Ultimately the socialists discretely kill all the sexual deviates the moment they can quietly get away with it. That has been the way it went in Nationalist Socialist Germany, the USSR, and in early Communist China. Hitler purged his Nationalist Socialist in one night, the night of the "long knives". The lesser-known deviates disappeared into socialist work camps. Socialist totalitarianism and sexual deviation do not mix. Once creeping socialism begins its cradle to grave control, a lot of people end up in graves. Hitler killed 20 million civilians. Russia just this past weekend admitted killing another 20,000 Polish leaders that Stalin secretly executed in 1941 and then blamed on Hitler. They claim Stalin killed about 80 million people in the USSR and the Red Chinese killed over 200 million Chinese to control their peoples.

World Markets
Asian markets were improved last night. China's market was down -0.2%, Hong Kong up 1.3%, India up 1.4%, and Japan up 0.9%.

European markets are down sharply again this morning in a range of about -0.7% to -1.2% half way through their day. Since the German banks and not private sources fund the EU debt, Germany is the chief beneficiary of the EU bailout because Germany then has all profits guaranteed plus a cheaper EURO to further improve their balance of trade. Essentially Germany has always followed British and American devaluation with their own devaluation to maintain a trade advantage as Japan always did and now China does. In effect Quantitative Expansion (QE2) in the USA propagates around the world as every country tries to improve their competitive advantage.

QE is something Karl Marx and most communists have never understood. They thought free enterprise capitalism was flawed because if profits were removed from the economy via capitalists then the workers could not buy back all their products so eventually inventories would grow and everyone would get laid off. The communists never understood economics. First of all the capitalists are not the ancient kings and queens that acquire and hold family fortunes. Most of the old aristocracy went broke long ago just as the estates of capitalists also go broke today. JP Morgan is an example of how a capitalist's profits end up in a foundation that helps everyone. Bill Gates will give all his $billions away because he knows that unearned money destroys children and lasts only a generation. It all goes back to the working productive people around the world who create job growth with their profits. And quantitative Easing is something the USA discovered during the economic depression that followed the Revolutionary War. About 3% inflation was then permitted for sustainable growth. The "cross of gold" was repudiated many times before President Nixon took America off the gold standard. Perhaps that is the misunderstanding socialists and communists have. The real value of gold goes down as more gold is mined. It only appears to increase when money is devalued. But corporations increase in real value as well as due to the relative decrease in the value of currencies. Gold and diamond are primarily a way to hold value when Hitler or Stalin or Kim Jong-il decides to nuke Beijing.

US pre-market futures were down about -0.6% to -1% at 8:30 AM EST.