North Korea said it has entered a state of war with South Korea a day after putting its forces on standby ready to strike South Korean and U.S. targets. “Every issue raised between the North and South will be dealt in a wartime manner,” the state-run Korean Central News Agency said today, citing what it called a special statement. Obama sent U.S. stealth bomber flights over South Korea Thursday that are an “unacceptable” provocation and this latest statement from North Korea is a “final warning” to the U.S. and its allies, KCNA said. North Korea’s military is awaiting a decision to attack from the Worker’s Party Central Committee, the report said. Party leaders are scheduled to meet by the end of the month.

Bernanke is doing his best to repeat the FED bubble disasters of the recent past.  The FED did not see the bubble that they inflated from 2005 until 2008.  The FED is clueless as to how their quantitative easing is inflating a stock market bubble and an Obama entitlement debt bubble that will likely cause rioting in American cities like in 1969 when this FED bubble bursts.  And given the past history of FED miscalculations this bubble will burst within about a year unless they stop inflating it.  The FED seems blind to the money coming to America to escape socialism and communism.  When the Bernanke bubble bursts all that money will flee from America and American banks will go bust again.  This time however America will be up to the eyeballs with Obama debt and there will be nothing left to stimulate. 

Obama has been hollowing out the American economy cutting the vital services and infrastructure such as national defense and hydrocarbon energy and subsidizing uneconomical energy sources and indigents that will cause an economic collapse when Obama debt bankrupts America.   It is absolutely foolhardy to think America will ever reach $20 trillion in Obama debt before the American Economy collapses.  This Bernanke bubble will burst within a year or two.  The Obama debt already exceeds the American debt of the entire WWII. 

Compare the two business cycles yourself.  See we are now beyond the normal four year business cycle and into the bubble already.  Then realize this economy has not expanded the corporation top line it…  it has expanded only the bottom line by cost cutting that has hollowed out American industry and stressed out the employees to the point of panic when it begins to unravel within two years.  This next time Wall Street brokers may be jumping out of buildings again (if any still have windows).

http://finance.yahoo.com/q/bc?s=%5ENYA&t=my&l=on&z=l&q=l&c= 

Bloomberg news declared that nobody is safe anymore since Europe broke more taboos and no longer bails out all depositors when banks fail.  Cyprus’s plight set precedents for the world that will stick in the memory of savers and investors alike and intensify the debate on who is next to fall victim to the debt crisis.  Under the terms of the agreement struck in Brussels, senior bank bond holders will take losses and uninsured depositors will be largely wiped out.  The message is that responsible people of all stripes can be coerced into helping a high spending socialist president.  No doubt it makes investors more concerned now about Slovenia, Italy, Spain and Greece. Bank runs and bond market selloffs now become much more likely the moment a country’s credit rating begins to decline. 

Major markets fell and the euro slumped to a four-month low against the dollar hit by a disappointing Italian bond auction and concern about the possibility of another wider Cyprus type bailout in the euro zone.  Italy still has not formed a functioning government since their election. 

The Senate adopted the first budget plan the Democratic- controlled body has passed in four years. The $3.7 trillion budget proposal, which Democrats say won’t ever take effect, highlights differences between Democrats and Republicans over taxes, spending and the size of government.  It is a strategy to win votes, not about actually improving job growth or about trying to restore prosperity. “Budgets are about far more than numbers on a page -- they are about the values and priorities of the American people,” said Senate Budget Committee Chairman Patty Murray, a Washington Democrat and the plan’s chief sponsor.  The two chambers probably won’t agree on anything, with Senate Majority Leader Harry Reid, a Nevada Democrat, saying he sees little reason to bother with a conference committee, in which lawmakers are supposed to work out their differences.

The vote clears the way for the next phase in Washington’s negatory-budget battle, which will probably revolve around Harry Reid political attacks and Obama’s need to raise the U.S. debt limit to increase spending. Federal borrowing authority is scheduled to expire May 19.

http://www.bloomberg.com/news/2013-03-23/u-s-senate-democrats-adopt-first-budget-in-four-years.html 

From an historical perspective gold could exceed 1750/oz within 12 months.

http://futures.tradingcharts.com/chart/DG/W?anticache=1364055809 

From an historical perspective silver could exceed 34/oz within 12 months.

http://futures.tradingcharts.com/chart/SV_/W?anticache=1364056143 

Boeing Co. plans to dismiss about 2,000 to 2,300 jobs in the Seattle area, Boeing’s headquarters for the development and manufacturing of commercial jets, said Marc Birtel, a spokesman.  It plans to first complete post- assembly fixes for its newest models, the 787 Dreamliner and the 747-8 jumbo jet. 

Barclays Head of Research Larry Kantor warned at briefing in the British investment bank’s New York headquarters, that the equity market's confidence bubble is bound to burst. It’s just a question of when. 

America had mental institutions before the 1960’s but the liberals closed them and put the sick people back on the streets medicated with Ritalin and other drugs with side effects such as psychosis.  The problem is not guns or knives or baseball bats.  The problem is psychotics and sociopaths who pass as being a little strange and then their demented mothers who take them for Karate and target practice and make their children lethal weapons.  The problem is not the guns but the psychopaths they put on our streets emptying prisons and insane asylums.

http://www.rxlist.com/ritalin-side-effects-drug-center.htm

Gun control; the historical agenda is to disarm the people you want to oppress.  http://www.youtube.com/embed/9RABZq5IoaQ?feature=player_embedded 

California and Rhode Island are now considered the most socialist states and have the nation’s worst unemployment rates of 9.8% as of January, the Labor Department said.  California was an agricultural state that boomed during and since WWII and produced the Silicon Valley, President Regan, and great prosperity.  But since the 1990’s has slid down and socialism and welfare state crept into governance and attracted immigrants from other states and countries seeking an easy life.  Nevada now with an unemployment rate of 9.7% moved off the bottom of the nation’s jobless ranking down from 10.2% in December. 

World Economies

http://www.bloomberg.com/news/

http://www.foxbusiness.com/index.html

Japan’s economy is going to improve in the coming months due to a weak yen and a pickup in exports,” said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute. 

Bleak euro zone economic data added to fear in the markets, driving demand for safe haven assets. U.S. Treasuries debt prices jumped, with benchmark yields falling to their lowest levels in three weeks.  The German bund gained and gold rose above $1,600 an ounce again. 

In spite of the flooding of the world with US currency, the German market has hit but has still failed to break out from the 2007.  Remember since 2008 we had over 15% inflation when we include food and energy so the market is still 15 off the real high when the high is hit. The German market continues to hit resistance.

http://in.finance.yahoo.com/q/ta?s=%5EGDAXI&t=my&l=on&z=l&q=l&p=&a=&c=

The Greek market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=AEX.AS&t=my&l=on&z=l&q=l&c= 

The French market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my 

The Swiss market indicates stagnation since 2007.  But once again look at the spike up in stock prices with Bernanke’s $85,000,000,000/month gift from America to the stock and bond markets of the world as more people enter poverty, go hungry and lose their jobs under Socialism’s equality of poverty.

 http://in.finance.yahoo.com/q/bc?s=%5ESSMI&t=my

  The NYSE is similar to the British and Swiss and indicates stagnation since 2007 given in excess of 15% inflation. http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

 

 American Economy

The DJI failed to break out.  Given the inflation exceeding 15% since the last high in 2008 it has a long way to go to break even in 2008 dollar value.

http://finance.yahoo.com/q/ta?s=%5EDJI+Basic+Tech.+Analysis&t=my 

The DJA in 2013 is also now at a record high due to inflation. Look at the spike up this year as $85,000,000,000 flows into markets each month.  http://finance.yahoo.com/q/ta?s=%5EDJA&t=my&l=on&z=l&q=l&p=&a=&c=

 

This week

http://biz.yahoo.com/c/e.html

Existing Home Sales continue depressed.

http://www.martincapital.com/index.php?page=graph&view=existing

The leading Indicators in Feb were flat at 0.5% due to stock market peaking.

Mar 26

Durable Orders Feb 5.7% up from -3.8% as seasonal airline orders pick up.

Durable Goods orders -ex transportation Feb -0.5% are sharply lower from 2.9%

Case-Shiller 20-city Index Jan 8.1% improves from 6.8%.

Mar 27

MBA Mortgage Index 03/23 +7.7% up due to previous sales -7.1%

Pending Home Sales Feb fell -0.4% after being up 4.5% last wee

Crude Inventories 03/23 3.256M up sharply after declining last week by -1.314M

Mar 28

Initial Claims 03/23 357K up from 336K

Continuing Claims 03/16 3050K up from 3053K

GDP - Third Estimate Q4 0.4% or 1.6% per year

GDP Deflator - Third Estimate Q4 1.0% or 4% per year wipes out almost three times the gain.

Chicago PMI Mar 52.4 plummeted from 56.8

Natural Gas Inventories 03/23 -95 bcf down from -62 bcf

Mar 29

Personal Income Feb 1.1% up after being down last month by -3.6% illustrating the incompetence of the people running the government when the entire economy over 12 months grew about 2%

Personal Spending Feb 0.7% up from 0.6 

PCE Prices - Core Feb 0.1% flat from 0.1%

Michigan Sentiment - Final Mar 78.6 up significantly from 71.8.  This shows the astounding ignorance of the administration in confusing The Conference Board (CB) data that comes out early in the month with the totally different Michigan University (MU) that just came out.  Here are the two different statistics plotted together.

http://www.martincapital.com/index.php?page=graph&view=consumer_sentiment 

The correct comparison is provided below:

http://www.martincapital.com/index.php?page=economic&view=currentecon 

Here is a correct comparison:

Michigan Sentiment - Final Mar 78.6 little changed from 77.6 last month.   

Markets March 29

Money is flowing into America and the American economy has been benefiting from the collapse of socialist economies as money flees Europe, the BRICKS, China, and Japan much the way it did in the late nineties when Russian and Asian equity markets collapsed and they had a banking crisis.  We see that is happening now as the dollar strengthens and the socialists squeeze their brightest and hardest workers to cover the cost of socialist entitlements.  Cyprus is a lesson and we will see money continue to flee socialist countries into American markets.  But the socialists will try to stop the outflow and will succeed.

Can world trade go any lower or has it flat lined?  It still looks like close to zero The American dock workers are ready to go on to strike as soon as the economy picks up.  World trade.

http://www.bloomberg.com/quote/BDIY:IND/chart 

Bernanke is pushing on a string.  The FED has run out of leverage at close to 0% short term interest rates. 

http://www.martincapital.com/index.php?page=graph&view=interest_rates_long

The VIX behaved this way in 2006 and 2007when the bubble began to unravel but the market did not collapse until 2008.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=m y&l=on&z=l&q=l&c= 

World market updates:

http://in.finance.yahoo.com/intlindices?e=asia

http://in.finance.yahoo.com/intlindices?e=europe

Thursday, Barclays Head of Research Larry Kantor warned at briefing in the British investment bank’s New York headquarters, that the equity market's confidence bubble is bound to burst. It’s just a question of when...

Since Obama’s election American corporations have dramatically increased their cash being sent overseas.  The prohibitive 35% corporate tax scheme only applies to honest corporations so corporations use loop holes that could swallow an A380 aircraft.  U.S. firms are pressured to keep 58% of their cash, or $840 billion, sitting overseas with no benefit to the money in circulation at home.  QE3 is supposed to fix the velocity of money yet the economy has stagnated and the labor market has moved sideways. 

For the last year market analysts have been low balling economic expectations so that a corporation can even beat expectations if it reduces its losses.  FedEx says it will increase its cost-cutting program because its quarterly profit missed Wall Street low ball expectations, a signal that package-delivery customers worldwide continue to shift to cheaper transportation.  
 

A study shows that American energy drinks are linked to deaths and hospitalizations, boost blood pressure and lead to an erratic heartbeat.

 

Red Chinese Premier Li Keqiang promises to do the kinds of things the Founding Fathers of America believed in.  The leader of Red China has just pledged to open the economy to more market forces and strip power from the government to achieve 7.5 percent annual growth through 2020 and spread the benefits of the nation’s expansion.  Li talked of a “hand” mistakenly attached to the government that needed to be returned to the market. He added that 7.5 percent growth is needed to meet targets for 2020, which include doubling per capita income. Gross domestic product last year expanded 7.8 percent, the least in 13 years.  While Obama has scorned American free enterprise and is digging a hole to bury it, Li Keqiang is digging out and has a new faith that his predecessors resisted.  Li Keqiang is building a new empire of freedom, opportunity, and prosperity while Obama is dismantling America and giving Americans equality of poverty.

http://www.bloomberg.com/news/2013-03-17/china-s-li-vows-to-keep-7-5-growth-and-spread-wealth-benefits.html

 

Gun control; the historical agenda is to disarm the people you want to oppress.

http://www.youtube.com/embed/9RABZq5IoaQ?feature=player_embedded

 

California and Rhode Island have the nation’s worst unemployment rates of 9.8% as of January, the Labor Department said.  Nevada with an unemployment rate of 9.7% moved off the bottom of the nation’s jobless ranking down from 10.2% in December.  The three states that are competing for the highest unemployment are the most liberal in the nation with drug proliferation and at spending what they can't afford.

 

George Soros says “sell gold” so he can buy it cheap?  It is not good to buy when Soros says to buy because he is selling to you.  He sold gold last year and he wants others to sell now so he can get back in.  Never believe a market manipulator.  Gold and silver seem to have bounced back as America leads the world toward Obama-bankruptcy of American principles and work ethic while China adopts more of the principles of the American Founding Fathers.

http://www.threethriftyguys.com/2013/01/2013-is-now-a-good-time-to-buy-gold/

 

World Economies

http://www.bloomberg.com/news/

http://www.foxbusiness.com/index.html

The Ifo institute German business climate index, based on a survey of 7,000 executives, declined to 106.7 from 107.4 in February.

German adjusted jobless rate held at 6.9 percent this month after the January rate was revised up from an initially reported 6.8 percent amid signs that Europe’s biggest economy is returning to growth after a contraction at the end of last year.  But Germany still shows stagnation since 2007.  In spite of the flooding of the world with money, the market has hit but has still failed to break out from the 2007 high even with the world being flooded with stimulation credit.  Remember since 2008 we have still had over 15% inflation when we include food and energy. The German market continues to hit resistance.

http://in.finance.yahoo.com/q/ta?s=%5EGDAXI&t=my&l=on&z=l&q=l&p=&a=&c=

The Paris prosecutor’s office said that Wednesday the French police searched the home of Christine Lagarde, the managing director of the International Monetary Fund. The Cour de Justice de la Republique is looking into whether former French finance minister Lagarde made an 385 million-euro missjudgement in agreeing to an arbitration to end a claim of businessman Bernard Tapie, a supporter and contributor of Former President Nicolas Sarkozy and others.

The Greek market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=AEX.AS&t=my&l=on&z=l&q=l&c=

 

The French market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my

 

 

In September of 1992 when manipulator George Soros made $1 billion by helping to force the pound out of the system that preceded the euro, sterling dropped by 9.5 percent. Sterling is down more than 7 percent against the dollar this year.

The British market indicates peaking in 2000 and stagnation since 2007.  It is not due to a loss of confidence in the economic policies of U.K. Prime Minister David Cameron; it is the policy Britain has used many times to improve exports.

 http://in.finance.yahoo.com/q/bc?s=%5EFTSE&t=my

 

 The Swiss market indicates stagnation since 2007.  But once again look at the spike up in stock prices with Bernanke’s $85,000,000,000/month gift from America to the stock and bond markets of the world as more people enter poverty, go hungry and lose their jobs under Socialism’s equality of poverty.

 http://in.finance.yahoo.com/q/bc?s=%5ESSMI&t=my

  The NYSE is similar to the British and Swiss and indicates stagnation since 2007 given in excess of 15% inflation. http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

 

 American Economy

Congressional leaders say they want to prevent even a partial halt of government operations by getting the stopgap measure to President Barack Obama, a Democrat, before March 27. That’s when the law keeping agencies’ lights on will expire. The DJI failed to break out.  Given the inflation exceeding 15% since the last high it has a long way to go to break even.

http://finance.yahoo.com/q/ta?s=%5EDJI+Basic+Tech.+Analysis&t=my

 

The DJA in 2013 is also now at a record high due to inflation. Look at the spike up this year as $85,000,000,000 flows into markets each month.  http://finance.yahoo.com/q/ta?s=%5EDJA&t=my&l=on&z=l&q=l&p=&a=&c=

 

This week

http://biz.yahoo.com/c/e.html

Existing Home Sales continue depressed.

http://www.martincapital.com/index.php?page=graph&view=existing

Mar 18

NAHB Housing Market Index Mar 44 48 48 46 –

 

Mar 19

Housing Starts Feb 917K up from 910K increasing new housing stocks

Building Permits Feb 946K up from 925K

Mar 20

MBA Mortgage Index 03/16 -7.1% declined more from -4.7% decreasing existing home sales

AM Crude Inventories 03/16 -1.314M sharply lower2.624M (higher prices)

FOMC Rate Decision Mar still at 0.25%  

Mar 21

Initial Claims 03/16 336K up from 332K even after Obama shifted 2K to last week

Continuing Claims 03/09 3053K up frpm 3024K even after Obama shifted 24K to last week

FHFA Housing Price Index Jan 0.6% no improvement from last time for existing housing

Existing Home Sales Feb 4.98M up slightly from 4.92M that is good for a change

Philadelphia Fed Mar 2.0 up from -12.5 also good

Leading Indicators Feb 0.5% flat 0.5% due to stock market

Natural Gas Inventories 03/16 -62 bcf not very useful information -145 bcf

 

Markets March 21

Cyprus may be the first EU state to be ejected and that will be a sign for Greece which is not far behind.

Look at the Bulls- Bears indicator.  The risk of being long is very high when bulls outnumber bears as we told you for the last month.  Now you can see Cramer had been lying to investors because he had been saying the market was climbing a wall of worry when actually investors were very bullish.  Even more bulls than bears means even more exuberance. 

http://www.martincapital.com/index.php?page=graph&view=investors_intel

 

Bernanke is pushing on a string.  The FED has run out of leverage at close to 0% short term interest rates. 

http://www.martincapital.com/index.php?page=graph&view=interest_rates_long

 

The VIX was worse (lower) recently than the low where it was in 2007 before the last bubble burst.  This week it began to rise again and may now continue to rise.  VIX has started to move up again and needs to go up above 30 before a bear market normally ends and it is time to buy.  Low Vix means excessive confidence.  A significant equities decline is now possible and it could last about another month on average before a breather.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=1y&l=on&z=l&q=l&c=

 

World market updates:

http://in.finance.yahoo.com/intlindices?e=asia

http://in.finance.yahoo.com/intlindices?e=europe

Trading by Brazilian individuals has dropped to the lowest level since 1999, exchange data show. Russian mutual funds posted 16 straight months of outflows, the most since at least 1996, and withdrawals in India are the biggest in more than two years with many investors losing more than 50% of their savings. Chinese investors emptied more than 2 million stock accounts in the past 12 months. Soon Obama will be finished with the fantastic manipulated US economic numbers which most employed people know is a lie because people wait in offices all over the country right now for pink slips they know is coming because American business simply cannot afford Obamascare without personnel cutbacks. Performance is high but American workers live in fear. Within a month Obama will swing the economic statistics back to reality and worse as he seeks more spending and taxes from congress and he begins to blame the bad doctored numbers on attempts to reign in the Obama deficit.

http://www.bloomberg.com/news/2013-03-15/brics-abandoned-by-locals-with-fund-outflows-highest-since-1996.html

US Senate Democrats and Obama would like $975 billion more in new tax revenue in their new bill.  The increase is more than the total budget (without the war) was when Obama took office.   Others think this number is another down payment. Obama also proposes to slow the rate of rise in welfare and entitlements by the same amount.  If that is what they plan to slow the growth of the welfare state then one hates to think how much it is being increased.  The Republican plan cuts spending by $6Trillion over the same period and reduces the corporate tax loopholes while reducing the maximum corporate tax from 35% (the highest in the world) to about 25% (still one of the highest) to give a net “0” change in corporate taxes.   But that being said it has the effect of bringing the corporation’s foreign “stashed money” back to American circulation.  The Europeans use a value added tax on products sold so corporate taxes there are much smaller.  Neither the Republicans nor the Democrats have begun to consider the rising cost of American debt as US Treasuries interest rates rise with inflation.  That is what broke the backs of Greece, Portugal, and Spain and is now just beginning to affect the USA. 

Treasury rates are rising and that is why all bonds and bond funds are at risk.  When interest rates rise… the old issued bonds lose their value and collapse.  The higher interest rates draw money from the stock market.  When they get above 5% the economy stagnates and the stock market stagnates and usually inflation gets out of control and that is when gold rises ten to twenty times in value.   With Jimmy Carter it was known as “Stagflation” and gold prices rose faster and faster. That all takes a short time when the government is run by socialists and the economy is destroyed by the growth of government and the welfare state as was the case in Europe in the 1920-30’s.  That is what is happening in Greece, Spain etc and most of Europe now as they sink deeper and deeper into welfare.  That is where Obama and his left wing are taking America, or at least are trying their best to take America to the European form of socialism which later becomes National or International Socialism in its “ultimate” form and the Hitler’s and Stalin’s rise to power again.  That is when they have no more people at home to rob with taxes… so they conquer and loot their neighbors.  That is when genocide is used to get rid of the “complainers.”  That is when gold or diamonds become worthless because if you had it they already killed you… you subhuman ilk which they despise.

http://nbcpolitics.nbcnews.com/_news/2013/03/13/17299251-senate-democrats-offer-budget-plan-with-tax-increases-and-spending-cuts?lite

http://dailycaller.com/2013/03/14/democrats-budget-plan-seeks-1-5-trillion-tax-hike-plus-10-year-spending-boost/ 

If Americans do not learn the history of the rise of Hitler and Stalin we are doomed to repeat the terror and genocide of National Socialism (Hitler) and International Socialism (Stalin).  Only there will be no America to arm the free world and send an army to free Europe.  We could actually be the world’s enemy if America ceases to be a free Republic as it has since its inception.  

The Wall Street “good news” hype for the rally was overstated.  The “Super Storm” Sandy explains the record home building and sales and the small uptick in jobs.  It explains the record sales of Lowes and Home Depot and record retail sales as NY and NJ build and furnish replacement homes. The Fed gave $51 Billion alone and the insurance and state aid is estimated to be three times greater.  The home building and other statistics only records the boost in new homes built to replace the homes destroyed but nobody subtracted the houses that were destroyed that equaled or exceeded the number being built.

http://therealdeal.com/blog/tag/hurricane-sandy/

http://blog.archpaper.com/wordpress/archives/54914

http://www.nysenate.gov/press-release/senator-lanza-announces-housing-extension-sandy-victims-new-checkout-date-tsa-program-

Is the domestic army formed and now armed?  A domestic army is unconstitutional!   These are not detectives like the FBI focused on crime and terrorists.  6billion rounds of ammunition is 2thousand rounds per American. It is interesting that Snopes has not commented on this for over a month.  It makes people think it is because Snopes do not want to admit it is true? 

http://www.homelandsecuritynewswire.com/dr20130215-dhs-to-buy-1-6-billion-rounds-of-ammunition 

Here is a Federal sales tax of 4+% hidden by Obama is his socialized medicine.

http://www.irs.gov/publications/p510/ch05.html 

George Soros sold his gold last year and is looking for a low price to buy in.  The market has not responded in his favor, so his friend Obama has been called upon to send the US CFTC to join the probe by Soro’s friends in London, a probe of potential bank gold price fixing.  George Soros is the biggest market manipulator in the world but gives politicians enormous contributions when they harass people and things that get in his way. 

Why is quantitative easing failing to create growth and jobs?  The reason is that QE is not growing the corporate top line because it expands credit but not the money in circulation and because the velocity of money is still declining.  You can see it with people unable to refinance because while interest rates are low the borrower feels ripped off with points from the many facilitators who take their points up front.  And the lower the interest rate the bigger in comparison the cost in points becomes.  Much of the money in circulation sits idle because the FED has made the cost of money negative with the low interest rates.  We cannot have growth when there is no inflation pressure to force people to put money to work.  But that is the rub.  QE is addictive and the FED fears the withdrawal symptoms which are painful reductions to the welfare society of dependency.

Samsung Electronics Co. is targeting the iPhone’s U.S. loyalists again with its biggest run yet, unveiling the new Galaxy S4 at Radio City Music Hall a few blocks from Apple Inc.’s flagship store in New York and broadcasting the event live in Times Square.  “The upcoming event in New York has big implications because it’s Apple’s home ground,” said Chung Chang Won, an analyst at Nomura Holdings Inc. in Seoul. “This is the first time Samsung has launched its Galaxy S phone in the U.S.”  We warned of this when Apple was at its high because the products rushed out the door were Steve Job’s last ideas.  Since then Apple has done little or nothing to hold market share.  We anticipate Apple will drop sharply again but will become a good buy before hitting 350.

 

The economist Nouriel Roubini was dubbed "Dr Doom" when he predicted the credit crunch.  He has now agreed with us and has sounded a stark warning about the long-term effects of relying on quantitative easing to keep crisis-hit western economies afloat.  "Over time, you get zombie banking, zombie corporations, zombie households, which is damaging in the long term," he said. The phrase "zombie banks" was coined in Japan, to describe insolvent lenders propped up by cheap cash.  He now agrees QE is addicting and has withdrawal symptoms.  Roubini stressed that "QE" had been critical in fending off a new Great Depression after the collapse of Lehman Brothers in 2008. But said "The short-term benefits of QE outweigh the long term risks," he offered nine reasons why such unconventional monetary policy could damage the economy in the longer term.

At issue is how central bankers across the globe will eventually unwind the uncharted stimulus measures enacted to prop up global growth since the onset of the financial crisis in 2008. Debt levels have soared for governments across much of the developed world. In Europe, political leaders are trying to save the region from a fiscal crisis now in its fourth year. Rather than unwinding the debt spiral they may be setting the stage for another round of “Great Monetary Easing” according to Morgan Stanley. See:

http://www.guardian.co.uk/business/2013/jan/23/nouriel-roubini-quantitative-easing-zombie-banks

Serious issues

75% to 80% of the Treasuries sold to finance US debt are now being purchased by the FED not China or Japan.  The other countries are forced to QE also to prevent their currencies from appreciating and their economies from getting squeezed.  Recently Japan recently increased their QE to drop the value of the Yen further than everyone else and the world did not like it.  Japan’s market improved but foreign investors saw nothing because in was in deflated Yen.  For the last few weeks we showed US rates were as low as they could go and the FED was pushing on a string.  Now our rates are so low that the percent increase from 0.3% to 0.6% is a 100% increase which means a 50% loss for people owning the treasuries bought at the lower rate.  0.3% is the effective rate of inflation in treasuries at this moment.  It slightly exceeds the general inflation rate but is very significant because the treasury rate inflation in previous years was negative even while real inflation was at 0.2%.  Neither the Republicans nor the Democrats are accounting for the rising cost of American debt as US Treasuries weaken with inflation. 

World Economies

http://www.bloomberg.com/news/

http://www.foxbusiness.com/index.html

Genocide against Christians in Pakistan drives Christians to seek a separate state from the Moslems just as the Moslems sought separation from the Hindus.

China is replacing the one regulator who has been attempting to clean up the fraud in their stock market.

President Hamid Karzai accused the US of colluding with the Taliban for access to Afghan natural resources when the US pulls out.

The International Monetary Fund predicts the world’s developed economies will grow only1.4 percent this year, half the 3% minimum developed economies sustained in the past. 

In 2003 the German economy was forecast to contract after stalling the previous year. A reform package was announced a meant to kick-start a country that had gone from post-World War II miracle to the sick man of Europe.  Lauded by Merkel and her party, which supported it then in opposition, the program spelled an end to German job security.  As the program took effect, the jobless rate declined from a postwar high of 12.1 percent in March 2005 to 6.8 percent in December 2011, the lowest since reunification in 1990. Last month unemployment held at 6.9 percent.

South Korea’s unemployment rate unexpectedly climbed to the highest in a year. 

Italian bonds borrowing costs increased at an auction Wednesday amid concern a political deadlock will derail plans to fix the nation’s finances.   The bond values fell suddenly with two-year yields rising the most in two weeks.

Ireland is trying to unload bonds now as it appears internationally interest rates are beginning to rise and future sales could be prohibitively costly.

Chinese stocks tumbled today in Hong Kong after the nation’s central bank chief said he’s on “high alert” for inflation.

Three years ago, Germany’s largest utility spent 400 million Euros building a natural gas-fired power station. Later this month, the company will close the plant because it’s losing so much money as Europe’s weak economy holds back electricity demand, requirements to buy government subsidized expensive renewable energy and the collapsing cost of carbon permits to burn coal are undercutting gas-fired plants.   The pattern is repeated throughout Europe as utilities mothball clean gas plants. The impact is a disaster both environmental and commercial. Switching to dirty coal increases emissions and lowers profit for clean gas plants.  The disaster is a socialist fiasco as they let politics decide on concurrent implementation of conflicting social programs.

EU bank debt addiction said to face scrutiny to QE and high leverage is being scrutinized by regulators. 

American Economy

USA debt interest rate rose a solid 0.3% in the past year in spite of the FED buying treasuries to keep the rate low.  The FED is losing control finally and inflation is now near their limit of 2.5% even with growth stagnated at about 2%,

The fear of inflation has become apparent with the extension of Quantitative Easing the “Quick Obama Fix” for the economies.

The productivity of U.S. workers fell in the fourth quarter by the most in four years, Labor Department figures showed Thursday.

The stock market is beginning to re-engage with the economy and is unstable because the FED created a balance sheet bloated approaching a trillion dollars putting US and world stocks in the stratosphere.     

The DJA in 2013 is also now at a record high. Look at the spike up this year as $85,000,000,000 flows into markets each month.  http://finance.yahoo.com/q/ta?s=%5EDJA&t=my&l=on&z=l&q=l&p=&a=&c=

 

This weeks Calendar

http://biz.yahoo.com/c/e.html

Obama has fudging the report numbers to make them look good again like he did before the election and then fudging them worse again when sequestering and the debt ceiling delays were negotiated.   He is making things look better and driving stocks sky high now so he can manipulate the data worse again in a month or two and blame the Republicans and say the deficit cuts of sequestering are already hurting too much and we need to tax and spend more.  That is what socialists do.  They are good at wrecking economies and blaming and harassing their critics.  Criticize them and they audit you and harass you with nonsense that requires you to hire accountants and lawyers to defend yourself.  They love to start harassing corporations a few months before campaigning for contributions from corporations.  Obama had all of Wall Street coming to him with handouts a full year before elections and notice all the litigation was dropped against Goldman and others who made tens of $billions on insurance against liar loans.  Everyone who understood the fraud bought insurance that paid off when the liar-loan derivatives collapsed and Goldman Sacks the biggest winner from liar loan fraud didn’t even get a slap on the wrist. 

Mar 13

MBA Mortgage Index 03/09 -4.7% sharply lower filings from14.8%

Retail Sales Feb 1.1% 0.2% slight increase from 0.1%

Retail Sales ex-auto Feb 1.0% down from 0.4%

Export Prices ex-ag. Feb 0.6% inflation more than 0.5%

Import Prices ex-oil Feb 0.0% import prices constant this time from 0.2%

Business Inventories Jan 1.0% still increasing slightly 0.1%

Crude Inventories 03/09 2.624M down from 3.833M

Treasury Budget Feb -$203.5B down from -$237.7B 

Mar 14 Initial Claims 03/09 332K down from 340K

Continuing Claims 03/02 3024K 3100K down from a manipulated 3113K when on a consistent basis it would be up from 3094K.  What is worse is they may have falsified the 3113 by later adding 19K after the announcement when no one knows or reports it to make this week look better.

PPI Feb 0.7% up initially from 0.2%

Core PPI Feb 0.2% flat at 0.2%

Current Account Balance Q4 -$110.4B up from -$107.5B

 

Mar 15

CPI Feb 0.7% jumped enormously from 0.0% at an 8.4% annual rate due to energy.
Core CPI Feb 2.4% still high down from a 3.6% annual rate when QE3 ends when it exceeds 2.5%
Empire Manufacturing Mar 9.2 down from 10.0
Net Long-Term TIC Flows Jan $25.7B down from $64.2B Foreign investment in the USA is declining as QE3 pushes foreign interests out.
Industrial Production Feb 0.7% bogus Obama number up from 0.0%
Capacity Utilization Feb 79.6% about as high as it goes without new investment 79.1%
Mich Sentiment Mar 71.8 sharply lower from 77.6 indicating Obama is no longer credible.

The Market, March 15, 2013

Jim Cramer said Tuesday that in the history the Dow has never had a winning streak this long that was not followed by a sharp pull back.  Even Jim Cramer is now concerned that the market has been over hyped and he should knows about hype.  But it continued up another day.

Foreclosure filings rose in February, but were down 25% from the same period in the prior year, according to data released Thursday.

The only argument that makes sense for the high and rising stock market is the possibility that investment is shifting from debt interest equities to stocks.  The people switching into stocks at a market high are probably the one’s who sold there stocks in 2009 near the market low and bought the low yield debt. 

The VIX was like this in 2005-2006 when it looked like the market would go up forever.    Low Vix means excessive exuberance.  A 10% equities decline is now possible and it could last about another month on average before a breather.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=3m&l=on&z=l&q=l&c=

World market updates:

http://in.finance.yahoo.com/intlindices?e=asia

http://in.finance.yahoo.com/intlindices?e=europe

Warning, the stock exchange volume was unexceptional the last two days when new high were hit. It had no energy. That indicates the institutions were selling to the small retail investors rather than buying and the retail volume was at best unexceptional. The recent relatively low volume as the market set new highs indicates the smart money is selling at this price level anticipating a pullback soon. Canadian gold mines are in a crisis and are expected to be shut down or on furlough because the price of gold is too low and the reserves are too depleted to be profitable. South African gold operations have become unstable and unprofitable with labor unrest. The supply side is for precious metals is dwindling due to high demand and inflation is almost at 2.5% now which is when QE3 will phase out and inflation and interest rates will rise like in the Jimmy Carter years when the Vietnam War debt was wiped out.

http://www.mbendi.com/indy/ming/gold/am/cn/p0005.htm

http://www.goldminerpulse.com/

Serious issues

75% to 80% of the Treasuries are now being purchased by the fed. That the FED is buying up most of our debt means that Japan and China are no longer bankrolling our debt, the FED is. That means the world is not going to provide a cushion for the debt of the Obamadepression.  That means the USA will feel the full brunt of the Obamainflation.

Here is some advice on what to do in a hyperventilating stock market atmosphere.  Let the experts tell you by watching them.  They buy small percentages of stocks they study and think will do well.  Then over time they add more to the stocks that do well.  Therefore the holdings of stocks that do well increase to 2% to 5% and if they are small funds they may jump in and you might find them holding 10% of a stock like Google.  Lesson 1, do not believe what they quote for performance because most have fees that eat you alive and they often do not invest “smart” as you need to do.  There are free services out there that allow you to plot stocks and funds together.  Pick the funds that claim the best performance to plot together.  Plot up five years to all the years available and you will find some of the best.  I am not going to tell you which they are because then everyone will get in and destroy the funds and make them the worst again because the funds will lose their skills because the public will eventually cause excesses followed by panic sell offs. 
Next go on to your brokers web site and do research and see what their top five stock picks are in portfolio size for each fund.   Remember they build up their holdings of their best selections.  Plot them up to see which are the best from several of the best performing funds.   Note these are stocks so you will not be paying fund fees and you are buying the best stocks the funds invested in and have built up holdings.  They will tend to be more volatile which is good for small investors because you do not want to buy them until they pull back.   If you buy them on the pull-back often they will rise again as much a 10 or 15 % in a few months and if they do you may wish to sell and switch into another stock that just pulled back.  Check at least once a month to be sure the fund is not liquidating slowly.  If they are you may want to get out.  Using this method you can avoid the risk of a stock going to zero. 
But you will also see many funds that followed Apple down.  We said to get out of Apple quite vigorously late last year and we shorted Apple for a while later.  The reason Apple stayed as high as it did was because their last great innovation fell a year after a quarter when Steve Jobs had no product released so earnings looked much too good and we knew that in advance.  Now apple on the next pull back may temp us to buy in.  But the fundamentals for Apple are still grim because they have apparently lost their creative spark.

British Press on “Obama so loved the poor.” Did you ever notice that there are only two international leaders that have ever befriended Obama? One is the communist Castro and the second was the Communist Chavez who died this past week. Communism is a system for the redistribution of poverty. All of Castro's and Chavez's critics met with prison sentences, "accidents" or fled the country.
http://www.youtube.com/watch?v=Tt2ZnF0ZeDg

The Dow Jones Industrial Average broke out on Tuesday.   Next it confirmed the break out and completed a Dow Theory Buy signal.  Yet, still a short  correction is overdue and it still could easily be -10%.  The most probable reason for this run-up is over exuberance caused by the FED throwing $85 Billion each month into buying approximately 80% of our treasury debt and creating reserves that artificially allow the banks to have higher debt leverage than the banking regulations would normally permit.  That money could flow into many places but is headed into stocks because hedge funds are also liquidating their treasury holdings and the conservative investors are doing exactly what we said they would do; they got out of stocks at the low and are getting back in at the new highs. 

http://finance.yahoo.com/q/ta?s=%5EDJI+Basic+Tech.+Analysis&t=my 

The only investment that will probably survive that collapse will be gold (and diamonds).  But probably no ETFs will survive and many mining stocks may lose their financing.  That will mean gold itself will spike up as it did at the end of Jimmy Carter’s stagflation period when it first spiked from $32/oz to over $800/oz in 1979.  Remember that in 1970 gold sold for just $32/oz.  The US dollar has lost 96% of its value since 1970 when it hit $800/oz in 1999.  The US dollar has lost 98% of its value since 1970 when it was at $1600/oz in 2012.  When the Obama-Bernanke economic national debt bomb explodes gold could easily rise to $6400/oz at which point the dollar will have lost 99.5% of its value relative to gold since 1970 when Nixon was president.

http://goldprice.org/gold-price-history.html 

On March 5, 1946, Churchill traveled with President Harry Truman to make a speech at Westminster College in the small Missouri town of Fulton (population of 7,000). Churchill gave his famous "Iron Curtain" speech to a crowd of 40,000.   In is speech, Churchill gave a phrase that opened the eyes of the people of the United States and Britain, "From Stettin in the Baltic to Trieste in the Adriatic, an iron curtain has descended across the Continent." Before this speech, the free world had been concerned with their own post-war economies and had remained grateful for the Soviet Union's support in defeating Hitler and his Nationalist Socialists. It was Churchill's speech, which he titled "The Sinews of Peace," that cleared way the free West viewed totalitarian Communist regimes.

Is the Obama administration liable for damages they inflict on Americans who have ideas that conflict with Obama’s?  Lately you hear a lot about people being fired for what they said on the internet.   What employer would harass an established employee by spying on them?  None of course, so someone who does not like them must be trying to hurt them.  And if it were the employer, the employee might have a case unless they are breaking the law or breaking an established company policy that the employer officially has in place and publicized.   Then who malevolently told employers about what those people wrote under freedom of speech or who gave the employer the location so the employer could find and read it?  Does the White House Aristocracy (WHA) go to their critic’s employers, state officials, or insurers and others to pull political strings to harass Obama critics and thus cause them financial loss or higher living costs because some Americans do not properly respect Obama?  Stalin was feared not respected… and Stalin could not even tell the difference.   Can Obama tell the difference?   In America we do not consider fear to be a form of respect.  It is a sign of oppression.  Will there be a class action suit filed against the Obama White House Aristocracy (WHA)?  Is that where Obama is headed… to impeachment?   Bob Woodward said,  “I am flooded from emails from people in the press saying this is exactly how the White House works. They're trying to control and they don't want to be challenged or crossed.”
http://newsbusters.org/blogs/noel-sheppard/2013/02/28/former-newsweek-editor-robert-gibbs-sent-me-abusive-email-article-i-w#sthash.whnDR5C2.dpuf

An article, "Obama: The Affirmative Action President", is currently being circulated with a new twist on “dirty tricks.”  It is circulated with false claims that it was published as a commentary in the Washington Post and other “liberal” papers.   Clearly those claims are intended to prepare the reader to reject the article as disinformation (a complete lie) not to read it.  The writer, Matt Patterson, and he has his articles on a web site and he usually publishes as a letters to the editor.   He can not write for the liberal press because they censor for the leftists.  Only when a leftist gets censored does the press come to their aid as they are starting to do now.  But it took a lot of dirty WHA tricks to get the press to react.  The web site “American Thinker” has his full “Obama” article up on the web without the added disinformation.  Based on what he read about Bob Woodward being threatened, shortly after the White House government aristocracy denied the reports that they threatened famed Watergate journalist Bob Woodward, former Clinton aide, Lanny Davis joined Woodward to claim he was also threatened by the Obama White House.  Davis said that a "senior Obama White House official" once called his editor at the Times and said that if the paper continued to run his columns, "his reporters would lose their credentials."  What other “dirty tricks” did the Obama White House play on other people perhaps even Matt for exercising their American right to free speech? 

1)         Did the government aristocracy threaten them with something vague like they did Bob Woodward?

2)         Did government aristocracy complain to their employer and threaten the employer’s staff access to the WH or contracts if he let them work again like Lanny Davis?

3)         Did the WH order the IRS to audit them and trump up something fictitious but seemingly costly if necessary?
4)         Did they violate their privacy by contacting their service providers to harass them with higher rates or by dropping their service?

5)         What and how many other dirty tricks can be done before it gets to the point that suddenly hundreds of writers, commentators, reporters, and other Americans come forward with similar disclosures of dirty tricks, violations of privacy and Freedom on Speech, and then Congress demands a special investigator.   And then someone on the White House inside turns States Evidence and a bunch of little people, agents, advisors, service reps who collaborated with them are fired or go to jail to cover up for the big fish running the WH show who, “Were blindsided and had no idea it was going on by their treacherous underlings!”

Dirty tricks and harassment are what National and International Socialists and other tyrants do when their power overwhelms their brains and they do stupid things.

http://mattpattersononline.com/welcome/Commentary.html

http://www.americanthinker.com/2011/08/obama_the_affirmative_action_president.html

World Economies

http://www.bloomberg.com/news/

http://www.foxbusiness.com/index.html 

On March 1 China imposed its toughest curbs in a year on public housing which is unlivable.   Imagine high apartment houses with apartments with no heat or running water and sometimes no internal walls.  They are essentially multi-story cave dwellings.  The Government aristocracy instead of condemning the construction will make more money on it by ordering the central bank to raise down-payment requirements and interest rates for mortgages, enforcing a property sales tax and telling local governments with the biggest price pressures to tighten limits. 

German factory orders unexpectedly fell a whopping 1.9% in January from February as the sovereign debt crisis curbed demand in the euro area, the Economy Ministry in Berlin said Thursday.  Economists had forecast a 0.6 percent gain, according to Bloomberg.

The Bundesbank said the German economy contracted 0.6 percent in the final three months of 2012 but could bottom soon. 

Germany is now beginning to test 2007 highs following the US lead.  It has so far failed to break out from the 2007 high even with the world being flooded with stimulation credit.  This is a highly risky business.  The Emperor (USA) has no cloths and sooner or later someone will notice and you do not want to be the last one out the door because you could be crushed in the rush.

http://in.finance.yahoo.com/q/ta?s=%5EGDAXI&t=my&l=on&z=l&q=l&p=&a=&c= 

The Greek market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=AEX.AS&t=my&l=on&z=l&q=l&c=

The French market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my

The British market indicates peaking in 2000 and stagnation since 2007.

 http://in.finance.yahoo.com/q/bc?s=%5EFTSE&t=my 

 The Swiss market indicates stagnation since 2007.  http://in.finance.yahoo.com/q/bc?s=%5ESSMI&t=my 

  The NYSE is similar to the British and Swiss and indicates stagnation since 2007 but no spike up. http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

 

 American Economy

The productivity of U.S. workers fell in the fourth quarter by the most in four years, Labor Department figures showed Thursday.

The stock market is beginning to re-engage with the economy and is unstable because the FED created a balance sheet bloated approaching a trillion dollars putting US and world stocks in the stratosphere.  The recent relatively low volume as the market set new highs indicates the smart money is selling at this price level anticipating a pullback soon.  

The DJA in 2013 is also now at a record high. Look at the spike up this year as $85,000,000,000 flows into markets each month.  http://finance.yahoo.com/q/ta?s=%5EDJA&t=my&l=on&z=l&q=l&p=&a=&c=  

This weeks Calendar

http://biz.yahoo.com/c/e.html

Mar 5

ISM Services Feb 56.0 56.0 55.4 55.2 -

Mar 6

MBA Mortgage Index 03/02 14.8% rose from -3.8% - good

Crude Inventories 03/02 3.833M up from 1.130M   -good

Massive distortion in the government aristocracy’s numbers this week. 

Factory Orders Jan reported down -2.0% after moving -0.5% from last months figures to this month.  Therefore it is down -2.5% on a consistent basis from last month’s report.

ADP Employment Change Feb was reported as 198K after moving 24K from this week to last week.  Therefore it is up 6K from last week and not a four month low as the socialist want you to believe.  It is actually 221K vs 192 they claimed as a record low last week too.  They socialist WHA thinks Americans are stupid.

U.S. trade deficit widened in January as demand for imported crude oil rebounded. The gap grew by 16.5 percent to $44.4 billion.  This is due to the continued absence of an intelligent American energy policy that cripples business and increases American poverty.

Mar 7

 Continuing Claims 02/23 3094K worsened from 3074K

Trade Balance Jan -$44.4B worsened from -$38.5B

Productivity-Rev. Q4 -1.9% worse again -2.0%

Unit Labor Costs -Rev Q4 4.6% worsened again from 4.5%

Natural Gas Inventories 03/02 -146 bcf meaningless number -171 bcf -

Consumer Credit Jan $16.2B getting very high again $14.6B

Mar 8

Nonfarm Payrolls Feb 236K improved from 157K

Nonfarm Private Payrolls Feb 246K improved from 166K

Unemployment Rate Feb 7.7% makes no sense down from 7.9% Unemployment not the labor pool drives the % unemployed because it has 14 times the effect.   You need about 140 new hires to offset 10 new unemployed.

Hourly Earnings Feb 0.2% flat 0.2%

Average Workweek Feb 34.5 fell, not a good sign 34.4 

Wholesale Inventories Jan - 0.2% got better from -0.1%

Obama WHA is manipulating the economic statistics again like the do in China and did in the USSR.  It will be much better when we have honest people instead of WHA deceit. 

The Market

The only argument that makes sense for the high and rising stock market is the likelihood that investment is shifting from debt interest equities to stocks.  The people switching into stocks at a market high are probably the one’s who sold there stocks in 2009 near the market low and bought the low yield debt.  They perhaps recovered 5% per year when even the NYSE more than doubled.

The VIX was worse (lower) recently than the low where it was in 2007 before the last bubble burst.  This week it began to rise, and then fell again and may now continue to rise.  Once that starts the VIX needs to go up above 30 before a bear markets normally ends and it is time to buy.  Low Vix means excessive exuberance.  A 10% equities decline is now possible and it could last about another month on average before a breather.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=5d&l=on&z=l&q=l&c= 

World market updates:

http://in.finance.yahoo.com/intlindices?e=asia

http://in.finance.yahoo.com/intlindices?e=europe

When Bob Woodward recently called a senior White House aide to say he had written a piece for the weekend paper that would question President Obama's version of how sequestration came about, and the veteran journalist said the aide "yelled at me for about a half-hour." Then he got a follow-up email, he says. "It was said very clearly, 'You will regret doing this,' " Woodward told CNN. "I mean, it makes me very uncomfortable to have the White House telling reporters, you're going to regret doing something that you believe in," Woodward said. Bob Woodward is correct that President Obama's version of how sequestration came about is not true. Below you can see that under President Obama’s orders Defense Secretary Leon E. Panetta cut the Pentagon budget by more than $450 billion and President Obama is taking the $1 trillion cuts from withdrawal from Afghanistan and the Gulf and putting it into entitlements and new Solyndra type jobs programs. There will be no capacity to take on Iran if necessary. President Obama is taking President Bush’s war deficit and converting it entirely into an additional entitlements deficit. That is why President Obama wants the sequestration and free hand to do whatever he wants while retaining the ability to blame his failing economy on someone else… even the reporters of his bad news.

Here is some of the background on sequestration.  Speaking from Brussels October 05, 2011, Panetta warmed America’s allies in NATO that serious budget cuts coming to the Pentagon could cause the United States to be much less likely to pick up the bill of NATO operations if the other member nations can’t come through. “As for the United States, many might assume that the United States defense budget is so large it can absorb and cover alliance shortcomings – but make no mistake about it, we are facing dramatic cuts with real implications for alliance capability,” Panetta said earlier October 05, 2011.  In September of 2011, US President Barack Obama delivered a speech from the White House in which he told reporters, “We have to cut what we can’t afford to make way for what really matters.” Among those on the cutting block, said Obama, are the overinflated military budget. He is hoping that proposed cuts and a withdrawal in Afghanistan could leave the government with around $1 trillion to use towards his highly touted (but still un-passed) American Jobs Act.

http://rt.com/usa/panetta-nato-us-united-165/ 

Under President Obama’s orders to cut the Pentagon budget by more than $450 billion over the next decade, Defense Secretary Leon E. Panetta is considered reductions in spending categories once thought sacrosanct, especially in medical and retirement benefits, as well as further shrinking the number of troops and reducing new weapons purchases.  Apart from the prospect of the automatic cuts, some Republicans have already criticized the administration’s planned reductions as dangerously severe. Some Tea Party members and liberals, by contrast, have argued that the administration’s reductions are too modest. 

The Obama administration’s more than $450 billion in cuts would reduce the military budget by roughly 7 percent over the next 10 years, even beyond the spending reductions that would come from the withdrawals from Iraq and Afghanistan, according to government budget projections. 

http://www.nytimes.com/2011/11/07/world/panetta-weighs-military-cuts-once-thought-out-of-bounds.html?pagewanted=all 

"Make no mistake, the savings we are proposing will impact all 50 states and many districts across America," Defense Secretary Leon Panetta told a news conference at the Pentagon. "This will be a test of whether reducing the deficit is about talk or action."

http://usnews.nbcnews.com/_news/2012/01/26/10244240-panetta-military-cuts-to-hit-all-50-states?lite

Shortly after the White House denied the reports that they threatened famed Watergate journalist Bob Woodward, former Clinton aide, Lanny Davis joined Woodward to claim he was threatened by the Obama White House.  Davis said that a "senior Obama White House official" once called his editor at the Times and said that if the paper continued to run his columns, "his reporters would lose their credentials." White House Press Secretary Jay Carney said Thursday that the White House stands by what they said to Woodward.  Obama is now using Nixon's tactics to quell scrutany of the American free press.  Josef Stalin said “Ideas are more powerful than guns. We would not let our enemies have guns, why should we let them have ideas.” 

http://www.foxnews.com/politics/2013/02/28/white-house-denies-staffer-threatened-watergate-journalist-woodward/ 

Former White House Chief of Staff Jacob J. Lew who has no education in economics or any business experience was confirmed to become President Obama’s U.S. Treasury secretary.

Barack Obama’s administration Thursday urged the U.S. Supreme Court against the California Proposition 8 referendum result.   Obama wishes to reinstate same- sex marriage in California, taking a stand in a historic case that could lead to gay marriages in every state. The justices will hear arguments on March 26 on California’s Proposition 8, the 2008 ballot initiative that halted gay marriage after the lower courts allowed it for five months. Today’s filing means Obama’s top courtroom lawyer, will probably take part in that session, making the case for gay marriage first in the nation’s most-populous state and then throughout the nation.

J.C. Penney Co. Chief Executive Officer Ron Johnson (an ex-Apple officer), is feeling the heat after his turnaround plan resulted in the department-store company’s lowest annual sales in more than two decades.  Its net loss in the latest quarter widened to $2.51 a share, from 41 cents, a year earlier.  The aura of Steve Jobs allowed many below average executives to reflect competence that was not their own.  While Apple may now be just another Microsoft or HP there are still possibilities ahead as it gradually loses to the competition.

Kohl's department store chain reported lower fourth-quarter profit and issued a full-year earnings forecast saying the Obama tax increases create a "significant headwind" for the economic recovery. 

When people ask how many Google employees telecommute, Chief Financial Officer Patrick Pichette told an Australian tech audience last week, he replies, "As few as possible."  Google wants workers to talk informally over meals or coffee. "There is something magical about spending the time together, about noodling on ideas, about asking at the computer, 'What do you think of this?' " 

Google and Facebook allow employees to work from home, relying on the judgment of employees and their managers, according to sources at both companies, which declined to comment on Yahoo's policies. But both companies have said they see a benefit in the creative sparks that come with random meetings in corridors or cafeterias.

Australia expects to spend $13.21 billion if it takes out its full order of 100 F-35s Joint Strike Fighters, according to a report last September by the government’s audit office, and has already approved a A$2.36 billion ($2.4 billion) spend on the first phases of the project.  The aircraft has one engine but three aircraft missions.  One version is a vertical takeoff configuration that is also supersonic.  Lockheed makes the aircraft and United Technologies makes the engines.  GE and Boeing versions failed the competition and have since lobbied for suspension of production. 

Recently Bloomberg has joined Jim Cramer trying to hammer down the price of gold so Soros can buy in at a lower price.   Gold prices touched a seven-month low of $1,554.49 an ounce minutes after the Federal Reserve's last meeting suggested some officials thought the bank might have to slow or stop buying bonds even before a pick-up in hiring.  But then the Bernanke said that was not the FED position.  Goldman Sacks has the reputation of taking positions opposite to which it recommends others take.  They even bet against their customers and profited from the knowledge of liar loans when all other banks lost money.  It appears Goldman may be shorting gold equities and that on top of India taxing gold last year could have slowed the rise of gold.  The best time to sell gold was mid September before the elections. 

http://futures.tradingcharts.com/chart/DG/M?anticache=1362095456 

On Monday the stock market suffered its worst loss since Election Day reinforcing expectations that the Standard & Poor's 500-stock index is topping out near the 1500 level, just as it did at bull market peaks in 2000 and 2007 and just as we are seeing in all the Western Economies.  Then the market made another run up on declining volume.  Then it failed to breakout on Thursday as volume returned.  

World Economies

http://www.bloomberg.com/news/

http://www.foxbusiness.com/index.html 

Vale SA, the world’s largest iron- ore producer, posted a record quarterly loss of $2.65 billion after writing down the value of some of its assets. 

China Life Insurance Co., the nation’s largest insurer, said profit for the first nine months of 2012 was estimated down 56 percent from the same period a year earlier. 
 

German adjusted jobless rate held at 6.9 percent this month after the January rate was revised up from an initially reported 6.8 percent amid signs that Europe’s biggest economy is returning to growth after a contraction at the end of last year.  But Germany still shows stagnation since 2007.  It has still failed to break out from the 2007 high even with the world being flooded with stimulation credit.

http://in.finance.yahoo.com/q/ta?s=%5EGDAXI&t=my&l=on&z=l&q=l&p=&a=&c= 

The German market continues to hit resistance.

http://in.finance.yahoo.com/q/ta?s=%5EGDAXI&t=6m&l=on&z=l&q=l&p=&a=&c= 

The Greek market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=AEX.AS&t=my&l=on&z=l&q=l&c= 

The French market indicates stagnation since year 2000.

http://in.finance.yahoo.com/q/bc?s=%5EFCHI&t=my 

The British market indicates peaking in 2000 and stagnation since 2007. 

 http://in.finance.yahoo.com/q/bc?s=%5EFTSE&t=my 

 The Swiss market indicates stagnation since 2007.  But once again look at the spike up in stock prices with Bernanke’s $85,000,000,000/month gift from America to the stock and bond markets of the world as more people enter poverty, go hungry and lose their jobs under Socialism’s equality of poverty.

 http://in.finance.yahoo.com/q/bc?s=%5ESSMI&t=my

  The NYSE is similar to the British and Swiss and indicates stagnation since 2007 but no spike up. http://finance.yahoo.com/echarts?s=%5ENYA+Interactive#symbol=^nya;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

 

 American Economy

The recently reported housing boom and increases in sales at Home Depot and Lowes can be explained by the reconstruction after the devasting huricanes.  The failure of sales in existing housing stock is consistent with that analysis because the huricane was a local effect.  A 10% or more equities price decline is now possible.  The stock market is beginning to re-engage with the economy and is unstable because the FED created a balance sheet bloated approaching a trillion dollars putting US and world stocks in the stratosphere. 

The DJI failed to break out.  If it fails to break out in the next few days it will be sign the bull market is over.

http://finance.yahoo.com/q/ta?s=%5EDJI+Basic+Tech.+Analysis&t=my

 

The DJA in 2013 is also now at a record high. Look at the spike up this year as $85,000,000,000 flows into markets each month. 

http://finance.yahoo.com/q/ta?s=%5EDJA&t=my&l=on&z=l&q=l&p=&a=&c=

 

This week

http://biz.yahoo.com/c/e.html

Feb 26

Case-Shiller 20-city Index Dec 6.8% up from 5.5%   Good

FHFA Housing Price Index Dec 0.6% Flat at 0.6%

New Home Sales Jan 437K mostly Multi family up from 369K   likely huricane Sandy.

Consumer Confidence Feb 69.0 up sharply from 58.6    Good

MBA Mortgage Index 02/23 -3.8% Mortgages down again from -1.7%  Bad

Feb 27

MBA Mortgage Index 02/23 -3.8% down sharply -1.7%     Bad

Durable Orders Jan -5.2% plummeted from 4.3%     Very Bad

Durable Goods -ex transportation Jan 1.9% up slightly 1.3%

Pending Home Sales Jan 4.5% up from -4.3%   likely huricane Sandy.

Crude Inventories 02/23 1.130M down from 4.143M  Bad

Feb 28

Initial Claims 02/23 344K down slightly from 362K

Continuing Claims 02/16 3074K up from 3148K

GDP - Second Estimate Q4 0.1% up from -0.1% but down from the election claim of +0.5%

GDP Deflator - Second Estimate Q4 0.9% up from 0.6%.  This implies negative GDP growth and 0.9% inflation  

Chicago PMI Feb 56.8 up from 55.6  

Natural Gas Inventories 02/23 -171 bcf declined from -127 bcf

The U.S. economy expanded at an annualized rate of 0.1% in the fourth quarter continuing the slowest rate in two years and well below the 0.5+% growth claimed occurring during the election campaign when it was claimed the stimulus had worked.

Existing Home Sales are flat.

http://www.martincapital.com/index.php?page=graph&view=existing 

Mar 1

Personal Income Jan -3.6% plummeted from last month 2.6% With Obama’s higher taxes on the middle class
Personal Spending Jan 0.2% was flat at 0.2%
PCE Prices – Core Production costs Jan 0.1% up slightly from 0.0%  
Michigan Sentiment - Final Feb 77.6 up slightly from 76.3  
ISM Index Feb 54.2 up slightly from 53.1  
Construction Spending Jan -2.1% down significantly from 0.9% signaling the hurricane boost is petering out.

Markets

Bernanke is pushing on a string.  The FED has run out of leverage at close to 0% short term interest rates. 

http://www.martincapital.com/index.php?page=graph&view=interest_rates_long

 The VIX was worse (lower) recently than the low where it was in 2007 before the last bubble burst.  This week it began to rise, then fell again and may now continue to rise.  Once that starts the VIX needs to go up above 30 before a bear markets normally ends and it is time to buy.  Low Vix means excessive exuberance.  A 10% equities decline is now possible and it could last about another month on average before a breather.

http://finance.yahoo.com/q/bc?s=%5EVIX&t=5d&l=on&z=l&q=l&c=

World market updates:

http://in.finance.yahoo.com/intlindices?e=asia

http://in.finance.yahoo.com/intlindices?e=europe