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