Rabu, 05 September 2012

September Just Begins, Things Are Already Falling Apart

September Just Begins, Things Are Already Falling Apart: World Economies Crashing, PBOC Won’t Cut Rates, The ESM Violates the Law And EU Treatie, Earnings Growth Expectations Weaken Globally, Capital Flows Out of Spain Have Reached 50% of GDP, Greece May Leave The Euro This Weekend


World’s Economies Are CRASHING! PMI Numbers Crashing Across The World. CHINA HSBC PMI FALLS TO LOWEST LEVEL SINCE MARCH 2009!!!

 ** Perhaps an ugly bellwether for the global economy, Asia’s aggregate exports turned lower Y/Y in July for the first time since the financial crisis, says Nomura’s Rob Subbaraman.

US: Manufacturing ISM Misses, Third Month In Contraction Territory; Biggest Miss In Construction Spending In One year

So much for the transitory bounce in positive economic reports from August. While hopes were high that maybe, just maybe, the virtuous cycle has once again been restored and the Fed’s intervention would be unneeded, the August Manufacturing ISM just printed at 49.6, down from July’s 49.8, and well below expectations of 50. This was the third contraction in a row and joins the global PMI which as we reported yesterday now has 80% of the world in contractionary territory. The kicker was the Prices Paid category which soared to 54.0 from 39.5, a whopping 14.5 surge, which together with the always hollow Inventories category which rose from 49.0 to 53.0, and Employment, which dipped from 52.0 to 51.6, were the only categories in the 50+ region. Everything else is now contracting. And in other news, Construction spending (remember “housing has bottomed”) plunged from 0.4% to -0.9%, on expectations of an unchanged print, which was the biggest miss in a year, and the biggest drop in also a year.

Why PBOC will not cut rates: China’s Repo Rate Drops Most in Six Months as PBOC Injects Cash

China’s benchmark money-market rate fell the most in six months as the central bank pumped money into the financial system, helping ease a cash shortage.
The People’s Bank of China conducted 55 billion yuan ($8.7 billion) of seven-day reverse-repurchase operations today at 3.40 percent, the same rate as when they were last used on Aug. 30, according to a trader at a primary dealer required to bid at the auctions. It also injected 40 billion yuan using 14-day contracts at 3.50 percent, down from 3.55 percent last time.

The ESM Violates the Law And EU Treaties (Welt)

The Federal Constitutional Court rules on 12 September on the constitutionality of the European Stability Mechanism (ESM) . The European Court verifies that violates the euro bailout of EU law. The Constitutional Court has already made clear that a new Euro Treaty and further financial support to weaker euro-zone countries do not cancel the Budget Law of the Federal Parliament must.
The ESM can buy directly from euro zone countries to provide them with government bonds or loans. This allowed the ECB officially not the EU Treaty. However, it emphasizes the federal government sees the ESM prior to a cap of 700 billion euros and limited the German share of it applies to “only” 190 billion euros. Apparently reading the Parties from politicians not or do not understand the details. The ESM is clearly illegal.

Germany adheres already representative

Contrary to assurances from Chancellor Merkel limited to Article 8 (5) of the ESM treaty, the fund capital not on the nominal value of 700 billion euros, but the output value. The ESM Board of Governors may decide in accordance with Article 8 (2), that the output value exceeds the nominal value. Thus, a large part of the ESM capital are issued at approximately twice the nominal value, the total liability of the ESM Member States would almost double.
 …

Germany – Record constitutional complaint 37,000 citizens complain against euro rescue

The claim against the euro bailout fund ESM has become the largest constitutional complaint in the history of the Federal Republic: 37,000 people have joined it. The government, however, before the verdict relaxed anyway.
Karlsruhe – the number of citizens who complain against the euro bailout fund ESM has tripled since the end of June to about 37,000. To show that the constitutional complaint “Europe needs more democracy,” the greatest constitutional complaint in the history of the Federal Republic, said the association “more democracy” on Tuesday.
The biggest complaint – 2007 against data retention – was supported by almost 35,000 applicants.
After the 12,000 people who were already at the end of June, the Board of the Association attached, were the KarlsruheConstitutional Court on Tuesday handed over more good 25,000 proxies. ”After filing the first civil lawsuit is the flood of support forms not demolished,” said club manager Roman Huber.

Spain’s Capital Flight Now Worse Than Asian Financial Crisis

Capital flows out of Spain have reached 50% of GDP on a 3-month rolling basis, says Nomura, compared with Italy now at 15% and Indonesia peaking at 23% during the worst of the Asian crisis.
via CNBC:
The flight of capital from Spain is now worse than what Indonesia, one of the hardest hit countries during the Asian financial crisis, experienced in the late 1990s, according to analysis by Nomura.
On a three-month rolling basis, portfolio and investment outflows from Spain totaled 52.3 percent of the country’s gross domestic product (GDP), (that’s) more than double the outflows from Indonesia, which reached 23 percent of GDP at the time of the Asian crisis, Jens Nordvig, global head of G10 FX strategy at Nomura wrote in a note to clients on Tuesday.
Spaniards and foreign investors have been pulling money out of Spanish banks as the economy has worsened in recent months, and Nordvig said without the single currency and the flows from the ECB, Spain would already be going through a major currency crisis. (Read More: Depression, Suicides Rise as Euro Debt Crisis Intensifies)
…

SocGen Presents: The 2 Biggest Risks To The Global Economy

Risk 1: Earnings growth expectations weaken globally
image
Risk 2: Potential oil shock could hurt recovery

Greece May Leave The Euro This Weekend

Following fifteen months of increasingly dramatic negotiations, the debt crisis has reached the point where financial analysts aren’t talking about if but when it will happen.
The New York Times spoke to experts who expect that such a grave decision would be announced after the close of business on a Friday after markets are finished for the weekend.
Then, if the country were to revert from the Euro, the currency which it has used since 2001, then it will require an extra bank holiday on Monday to organize and distribute the new currency.

One Of The Biggest U.S. Investment Banks Is On The Verge Of Collapse


Jim Willie’s latest Hat Trick Letter, ‘Firestorms & Currency Twisters‘ is a MUST READ!!
Willie states that Morgan Stanley faces IMMINENT FAILURE & RUIN, that The older employees are selling all of their stock, and that Many workers are making contingency plans for their next positions in another firm.

He states that JP Morgan will devour the carcass, and that The Morgue may be preparing to execute the 1st ever private stock account vaporization/ rehypothecation.


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