Links 12/12/2012

- MUST READ: Apple to Relaunch Manufacturing in US, Net Result +200 Jobs; Lights Out 

- PRINT MORE MONEY - the new head of BOE, a former Goldman Sachs executive, is already hinting at more QE

- Cox and Archer: Why $16 Trillion Only Hints at the True U.S. Debt. What cannot be repaid, won't.

- Recovery? What recovery? The US trade deficit increased in Octobe.

- Only In California: School Owes $1 Billion On $100 Million 'PayDay' Loan. Actually, the worst part of it is that it's NOT just California...

- Bolton grandfather sets himself on fire after amassing secret loans and credit card debts of £150,000

- Chart: Unsold Cars Are Piling Up, Mainly American Ones

- Acquisitions/Monopolies forming everywhere: Delta Buys Virgin Atlantic Stake for $360 Million

-  Chevron’s standing order: no sitting down on the job (in order to increase productivity)

- Work till you drop- Stakhanov style: Putin Restores Worker Award of Soviet Era  SEE ALSO http://en.wikipedia.org/wiki/Alexey_Stakhanov

- Welfare, like everything else, is AN INVESTMENT. For example, noone wants to give away hi money to someone who is going to spend it on drugs and alcohol, because that would be "a bad investment". But if someone needs some money in order to get back on his feet, start a business that is, at least in theory, a good one, then it would be "a good investment" to give him some money, as part of "the welfare state". The problem today, from a capitalist's point of view, is that we have many people who have no jobs and are receiving free benefits that are coming out of our pockets, but these people have no chance of finding a job, or starting a business of their own. So, the "welfare state" looks like "a bad investment". Check this out: "she is better off on benefits" and would not get a job unless she could continue her luxury lifestyle". SEE ALSO: Free phones and internet access for the unemployed

- The Internet Is a Dud

- Capitalism is about taking risks, you invest resources (time, money, labor, energy, physical resources, etc), and if there is a demand for the product you produce, then you will do well. If not, you will go bankrupt. At least that's the "free-market" version of capitalism, which of course doesn't last long, because sooner or later, monopolies start forming, and since they can control the market, they can enforce their will on the rest without much risk. Still, taking a chance is an integral part of capitalistic growth, and without it there can be no growth: Japan's Fear of Risk Is Getting Dangerous

- China is buying up every hard asset it can find: PetroChina to buy BHP's stake in Browse LNG project  

- U.S. warns Russia about fronting for Iran banks in SWIFT http://on.wsj.com/Vz74yn Only problem is Russians don't care what America thinks, and they don't care about violating the embargo any more.

- Rosneft -TNK Deal Nears Completion - Rosneft will control 1/3 of crude output in Russia

- China's New MIRV Ballistic Missile Is A Big Deal

- Africa is growing/intergrading into the global market - there is even a monopoly board game to prove it :-) As in all the developed capitalistic countries, Africa now is run by a few oligarchs, and this is why the classic board game of monopoly can now be applied to Africa as well.

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Links 12/10/2012

- Let's print some more money! That will certainly solve all of our problems, right? Central Banks Ponder Going Beyond Inflation Mandates.
Just a quick note on 'money' (=currency) creation: If the newly created currency corresponds to newly created wealth, then, this is NOT inflationary, because the newly printed money are NOT printed "out of thin air". So long as there is growth/production of new wealth, there are more products (which are also of higher value), and there is more and more 'specialized labor', for maximized productivity (the more 'specialized' you are at something, the more productive you are at it). So, this leads to more trade transactions (because there a re more products), and a lot of these new transactions are about products of higher value (for example a new computer has higher value than an old one, it is 'better') ==> As a result, it is logical to create new currency, in order to complete these new transactions (we are talking about a capitalistic society obviously).
Today, we live in an era where everyone is printing 'money' by the trillions, without it corresponding to increased production of wealth. This is the very definition of 'inflating one's currency', and states around the world, especially in the West, have no intention of stopping (why would they? Money-printing is the only way for them to save the bankrupt banks and impoverish the) workers ==> People will stop accepting payment in a currency that is constantly being devalued ==> Hyperinflation.

- World risks fresh credit bubble, Switzerland's BIS warns
 
-  Foodstamps Soar By Most In 16 Months: Over 1 Million Americans Enter Poverty In Last Two Months

- Protectionism is on the rise: Tit-for-tat, EU takes Argentina to WTO SEE ALSO: Russia Sticks a Fork in U.S. Pork

- Car plants are shutting down in Europe (because less and less people can buy a car there), BUT the opposite is true for China, where more and more people can afford to buy a car.

- China spent record $57.2bn on outbound acquisitions this year - China has a lot of dollars, that are constantly depreciating in value, so it prefers to spend them in buying HARD assets (gold, energy resources, etc. SEE ALSO:
Huawei Sets Up in Nokia's Back Yard
AIG to sell up to 90 percent of ILFC to Chinese group

- Turkey is not affected by the embargo on Iran Turkeydoes not comply with the US-Western embargo unilaterally imposed on Iran, America's influence is fading away, no?

- EDUCATION: Skills shortages are getting worse even as youth unemployment reaches record highs. The capitalists have A LOT OF unskilled workers who accept poverty wages of 1-2 dollars/day. So, if you have no real "skill", they just don't care about you. They are interested in skilled workers, who are more productive. But as the market is changing at a rapid pace, very few people will actually be able to make a living in the long run...

- EDUCATION: Sony Loses Science Talent as Student Resumes Go to Dairies

- Bloomberg buying the Financial Times? Talk about concentration of the media...

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Links 12/09/12

- EU has long considered the Nabucco gas pipeline a priority project needed to break its strong reliance on energy from Russia, and USA has been backing the project - but now Nabucco is fading away, because RWE AG (a GERMAN company) is backing off the project. Germany has sided with Russia, no? RWE Exit Deals Blow to European Gas Pipeline 

- MUST READ: USA - Exporting Gas And Oil Will Not Erase The Trade Deficit


- Japan - "Let's print some more trillions": BOJ Has Done Too Little, Says Potential Contender for Governor.
Here's Krugman's "explanation" for this non-stop printing of money: "..the U.S. government can't run out of cash (it prints the stuff).." http://nyti.ms/TJKwOG .Can you spell "hyperinflation"?

-  Giant Platinum Coins Will Not Save US Finances

- Walmart: "Not Financially Feasible" To Take Minimal, Legally Required Steps to Save Workers' Lives. Well, the workers in China are more competitive BECAUSE OF the lack of safety measures, adequate wages, etc. So, every capitalist is now thinking that these things are a liability, no?

-  China continues to spent its dollars on buying up HARD assets, especially gold, energy and land: Canada Approves Controversial Oil Company Sale To China

- Analysis: SE Asian governments gamble on making cheap labor less cheap

- Here's an example of how the "liberal age" of capitalism is coming to an end - Ivy League Cracks Down as Students Spiral Out of Control: “Colleges have been in an arms race to prove to students that they’re cool and give more freedom than the others, Now, maybe the pendulum is starting to swing the other way.”

- Unemployment statistics in USA are being blatantly manipulated: NFP: +146k (What?)

- Turkey Missile Deal Moves Ahead, With Limits - German Cabinet Approves Two Patriot Batteries for Syria Border Zone, Far Less Than Ankara Sought 

- Japan Deploys Anti-Missile Shield Against North Korea Rocket

- Canada Rejects The Pricey F-35 Joint Strike Fighter

- "There is no such thing as a free lunch" - getting something for nothing is obviously NOT a situation that can last forever, no? Here's an example: Google to Rein In Free Version of Software

- TECH: By the numbers: The Demise of PCs

- TECH: On Legacy iPhones and Cannibalization (This article is far more interesting and it has far wider implications than its name suggests)

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Links 12/07/2012

- Europe and Asia coming together (after all, Europe wants Asia's goods/services and Russia's energy, and Asia-Russia want Europe's goods and services, and its technical know-how, so now that America is no longer able to control Europe like before (due to its decline), Europe & Russia/China are a perfect fit for each other): Land bridge to boost Asia-Europe trade:"Trade between China and Shanghai Cooperation Organization members will be greatly boosted, thanks to Eurasian countries' efforts to improve the transportation channel of a new Eurasian land bridge linking China and Europe, experts have said.". SEE ALSO: Putin to visit Brussels as 'Eurasian Union' leader

- Asia, China in particular, is investing in hard assets, like land, energy, and of course gold: Record Asia Oil Takeovers Match U.S. Pace for First Time: Energy. SEE ALSO: Bank of Korea Raises Gold Holdings as Central Banks Buy

- Southeast Asia at a Crossroads on Wages: This is a "paradigm shift", as the "Western consumer" is dying, and the exporting nations (Asia + Germany) need to find someone else to consume all the goods and services that were previously exported to the West. At the same time, the Asian workers are starting to demand better working conditions, and better wages, which would make them 'better consumers' I suppose, but at the same time, the capitalists never like giving more to the workers. But if they don't, who is going to buy all these goods and services?

- BTW, Apple is set to return some Mac production to U.S. in 2013, because wages are going up in Asia, and down in the West, so maybe it is preferable to return there (let's not forget that Apple will also save money on shipping costs, and that Apple will also be able to sell more iMacs if they are "made in USA", because some people in the West will gladly pay more money to support their national economies). After all, protectionism is a rising trend (SEE ALSO:  Trade wars, protectionism, military spending and war; Who is Nikolai Bukharin?)

- Meanwhile, back in the PIIGS nations: Jackpot In Italian Lottery: Supermarket Job - a supermarket has come up with a novel way of hiring. According to Germany's Mittelstands Nachrichten, customers who spend over EUR30 will receive a lottery ticket and the grand prize winners will be given "temporary part-time assistant jobs" at the supermarket. You are not competitive enough -> No investments -> You are left to starve to death -> If and when the wages level drops to a Bulgarian-like level, maybe the capitalists will start reinvesting there. For now, unemployment will continue to rise

- And it's not just the PIIGS nations, it's the entire West that is not competitive enough (with the exception of Germany, where things are noticeably better in terms of how competitive the labor force is). Here's something from England for example: Students Become Strippers

- Financially Sick Firms Often Grant Bonuses in Months Before Bankruptcy Filing. "So what if I led the company to bankruptcy? I am the boss, so I will take my big fat paycheck and the rest of you can go to hell for all I care!"

- Santa-Claus is coming to town (if you've been a good little banker that is) -  more free bailout money coming to the insolvent banks from Santa-FED: Fed to launch fresh bond buying

- The City of London should be deposed as the euro’s main financial centre so the single currency club can “control” most financial business in the eurozone, France’s central bank governor has said.

- China is on the rise, but, much like the West a century ago, during the Guilded age, China will too experience a series of crises. The difference is that China will emerge stronger (like the West emerged stronger from the crises of the past century), because China attracts capital investments, and this means that China will continue to grow, despite the crises. Here's an interesting piece by M. Pettis on China's growth : Three cheers for the new data?

- Gambling has been around for many many years, and it tends to increase in times of crisis, as people become more desperate in  looking for ways to make money. So, it is "a good investment", and this is how Facebook (and Zynga) will become profitable: By incorporating an online gambling service..Many investors think that Facebook's business model is bad, because it is not making any money, but if they were to offer an online gambling service, things will change...(NOTE: I am not advocating gambling -quite the opposite actually- I am simply pointing out how the whole thing works)

- Intel probed the market by announcing the death of socket #CPUs - when they saw that people hated the idea, they backed off

- Germany used to have some "moral standards" when it came to selling arms to other countries. But "moral standards" are a liability in times such as these - so, Germany is now selling arms to everyone

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Links 12/03/2012

-MUST READ: 2008? That’s Ancient History, Right? (see also Leveraging/Deleveraging: “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world”)

Memories are short, and 2008 is ancient history. Consumers can’t suppress their urge to consume. Lenders can’t suppress their urge to lend. We’ve learned nothing from the last boom-bust. We are repeating it, piling error upon error.

“People will spend more of their equity,” Chris Christopher, an economist at IHS Global Insight in Lexington, Mass., tells Bloomberg. “It won’t be as much as they spent when prices were gaining at a rapid pace in 2005 and 2006, but it should have a positive impact on consumer spending.”

As you may have detected in Mr. Christopher’s statement, bankers (speaking of short memories) are back in the business of making home equity lines of credit — HELOCs — and consumers are ready to ramp up the good life again [...]

[...] Of course, this increase in home prices is a temporary mirage, as empty homes and those occupied by strategic squatters are held off the market by legal kinks in the foreclosure hose. ZeroHedge estimates that an additional 2.5 million homes should be for sale. For now, millions are living in homes mortgage-free “just to perpetuate the illusion that ‘housing has rebounded,’” writes ZeroHedge.

The problem with this consumer debt is that while analysts cheer on the consumer purchases, the debt is what market analyst Robert Prechter calls unproductive. Three years ago, Prechter pointed out in his Elliott Wave Theorist newsletter that banks had been lending to consumers at the expense of businesses [...]

[...] Only business loans are self-liquidating. Healthy businesses generate cash flow that can pay off debt, while consumer loans “have no basis for repayment except the borrower’s prospects for employment and, ultimately, collateral sales,” Prechter wrote.
Lines of credit to businesses are provided with the understanding that the business borrowers will “revolve the debt,” borrow to pay vendors and employees and then pay down the debt as their customers pay them for product. Thus, the debt is directly tied to the business firm’s production. The funds tend to be borrowed only for short periods of time. Credit, in this case, aids a business in potentially earning entrepreneurial profits, which build capital, which ultimately fuels economic expansion.

Conversely, consumer debts are not self-liquidating, but instead stay on the banks’ books for long periods of time, with payments being made only to service the interest and pay down very small portions of the loan principal balance [...]

- OIL is still King (and it will continue to be King for the foreseeable future, because it is a lot cheaper than green energy (which has a long way to becoming financially viable, for the moment it only exists because of government subsidies at the expense of the people who pay increased energy bills to sustain the green energy industry) and easier to use/store than gas or nuclear energy): IT'S OVER: Why Everyone Is Losing Hope For Green Energy

- Regardless of the various political games between America and Europe, that's what happens when you try to deal with everything by using more and more money-printing: You lose credibility - European Rescue Mechanism Loses AAA Rating

- Ever played Monopoly? (yes, the classic board game). The game starts out as a "free market", but it always ends up creating monopolies/oligopolies. In fact, the only way for this game to end is to form a monopoly, where one player controls the "market" and everyone else goes bankrupt...Here's the latest news on the real-life monopoly game we are all playing: 4 Companies Provided Half of SPX 2012 Earnings Growth

- And talking about monopolies and oligopolies, the few big players in the market are destroying or acquiring everyone else, just like the board game - here's the latest example of an acquisition by google: Google Is Going On An Acquisition Spree To Compete With Amazon

- And the more concentrated property and wealth become, the more necessary it becomes for those who own it to protect it by all costs, even if it means destroying the competition by not allowing it to compete and create a better product - here's the latest from the "patent wars" on 'intellectual property' and more (SEE ALSO  Intellectual property rights and "patent wars"):

• America's dysfunctional patent system is stifling innovation
• The Supreme Court Is Going To Decide If Biotech Companies Can 'Patent Nature' 

- TECH: Asia is being incorporated into the global market, and they are growing (in a capitalistic, non-equal way of course) $25 tablets, $2 mobile data plans, and zero margins–how the internet is about to gain 3 billion new users

- TECH: Staples Will Offer In-Store 3D Printing

- This is old news: Detroit on the Verge of Insolvency, Again

- Free-trade is good, but if we can't compete, we'll just not gonna use it: EU okays free trade talks with Japan while protecting cars (SEE ALSO  Trade wars, protectionism, military spending and war; Who is Nikolai Bukharin?)

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