marți, 24 aprilie 2012

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


U.S. Creates New Spy Service (Because 16 Intelligence Agencies is Not Enough)

Posted: 24 Apr 2012 08:01 PM PDT

The US currently has sixteen intelligence agencies. The Secretary of Defense now wants yet another agency, and the only logical conclusion is the sixteen existing agencies simply cannot get the job done.

Collectively US intelligence agencies missed 911, Egypt, Libya, events in Iran, and they thought Hussein hid weapons of mass destruction in Iraq. Currently they do not know if Iran is attempting to build nuclear weapons or not. Alternatively, they do know, but do not want us to know what they know because it might make the oil embargo look downright silly.

Occasionally the agencies get something correct, such as finding Bin Laden after nearly a decade of looking. However, given the overall track record, one has to wonder if that discovery was simply an accident as opposed to careful analysis.

The Mark comments U.S. Creates New Spy Service Because 16 intelligence agencies just wasn't enough.
U.S. Defense Secretary Leon Panetta announced that the Pentagon will soon launch a new intelligence agency to be known as the Defense Clandestine Service that will be tasked with tracking issues of "global strategic importance," such as nuclear threats from Iran and North Korea. The DCS will become the 17th active intelligence agency within the sprawling U.S. government and is expected to complement Defense Intelligence Agency, which is more focused on finding out information on battlefield tactics and maneuvers of enemy combatants. DCS, then, will take a broader approach to military intelligence, which is sort of what the Central Intelligence Agency already does, but hey, at least it means someone in the U.S. government will be doing some hiring in the near term.
Do we really need yet another intelligence agency, complete with yet another bureaucracy? I suggest we don't. In fact, I think we should collapse all of the existing agencies under one umbrella (assuming of course they are worth keeping at all). Unfortunately, that is debatable.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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Marc Faber Discusses Imminent Market Crash, a Recession in China, Says Fiscal Condition of US a "Catastrophe"

Posted: 24 Apr 2012 10:06 AM PDT

Inquiring minds are listening to Marc Faber on the global economy.



Link if video does not play: Marc Faber speaks of Imminent Market Crash

Faber says China faces a recession defined as a slowdown to 3%.

Interestingly, 3% is the same long-term target that Michael Pettis at China Financial Markets has come up with. Indeed Pettis has made two bets with the Economist over growth rates and when Chain will surpass the US in terms of GDP.

The Economist says China will pass the US up by 2018. Pettis and I say no way. Pettis also says China will average 3.5% or less growth for the rest of the decade. I agree with Pettis.

For details of the bet and my thoughts, please see 12 Predictions by Michael Pettis on China; Non-Food Commodity Prices Will Collapse Over Next Three to Four Years; Nails in the Hard Landing Coffin?

Faber does not believe China's GDP as stated now, and neither do I. Both of us think China has hugely understated inflation.

However, Faber sees a chance of serious inflation in the US. I don't. Faber narrowly focuses on money supply and ignores credit. And credit will collapse once again if the US heads back into recession as Faber thinks. Indeed credit has at best held steady in this recovery, after one corrects for student loans.

Please see The Real Consumer Credit Story: Virtually No Recovery in Revolving Credit, No Recovery in Non-Revolving Credit
for a discussion.

Since credit dwarfs money supply, odds of significant inflation in the face of negative credit growth is not high. Those betting on high inflation or hyperinflation have simply been wrong, and will continue to be wrong until Bernanke reignites bank lending.

Given capital constraints on banks, consumer needs to deleverage, boomers heading for retirement with insufficient savings, and businesses reluctant to expand, Bernanke is fighting a losing battle and will be for quite some time.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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Does it Matter if Obama Beats Romney? Does it Matter if Hollande Beats Sarkozy?

Posted: 24 Apr 2012 03:25 AM PDT

Does it really matter who wins the French presidential election between socialist François Hollande and incumbent president Nicolas Sarkozy?

What about the race in the US between President Obama and Mitt Romney? Let's discuss those questions one at at time.

Does it Matter if Hollande Beats Sarkozy?

In spite of alleged differences, both candidates are in support of Eurobonds, both candidates want immigration controls, both candidates want the ECB to be more proactive, both candidates want to protect French farms from import threats.

To varying degrees both candidates are against free trade. Most importantly, both candidates want Germany to take on more risk and pony up more money to "save" the euro.

Judging from their platforms, allegedly center-left by Hollande, and center-right by Sarkozy, there is little difference. So does it matter?

Actually it does. The risk the eurozone splinters to smithereens sooner rather than later is greater under Hollande than Sarkozy for two reasons.

  1. Hollande wants to rework the Merkozy treaty and doing so may collapse the treaty immediately
  2. Hollande will not have the same respect of the rest of Europe that Sarkozy had. Thus any new agreements needed to hold the eurozone together may become politically impossible, immediately

Since I believe a breakup of the eurozone would be a good thing, I hope Hollande wins even though that puts me in the seemingly preposterous position of rooting for a socialist.

Many will disagree with my supposition  "a breakup of the eurozone would be a good thing". However, it is going to happen regardless. No currency union in  history has ever survived in the absence of a political union, and it should now be clear that a political union is impossible.

Thus, the eurozone focus should not be on how to save the unsavable, but rather how to breakup the eurozone at the least cost. Delays are clearly costly as Greece proves. What was at one time a 40 billion Euro problem is now, after multiple haircuts, a 200 billion euro problem.

Spain and Portugal will prove to be the same, only bigger. Simply put, the sooner the eurozone break apart, the smaller the ultimate damage. Since Hollande provides a better opportunity for a faster breakup, he is the better candidate to support.

Does it Matter if Obama Beats Romney?

On the surface, and for similar reasons it will not matter whether Obama wins or Romney wins.

Discounting a supreme court decision, the US will be stuck with Obamacare on one hand or Romneycare on the other. If you think that matters, please tell me how.

Both Romney and Obama are warmongers, the only question is to the degree. When it comes to military spending and waging wars, Romeny is nutzoid-rightwing and Obama simply strongly-rightwing. Romney practically guarantees war with Iran but Obama makes the odds merely likely.

Trade policy is similar. Romney guarantees a trade war with China while trade wars are merely highly likely under Obama.

On the plus side (or minus side depending on your point of view) Obama will of  pander to the public unions but Romney won't, but will either candidate bring about much change in either direction?

I suggest not.

Will Romney or Obama deal with the budget deficit? Once again the answer is no. Romney might claim to, but details on his proposals are sorely lacking.

Moreover, once elected, Romney's primary goal will to be reelected. That means Romney will pander to the politics of graft and bailouts. His wishy-washy track record proves just that.

So does it matter?

On the surface it doesn't. Except for women's reproductive rights issues (and on that issue I side with Obama), Romney and Obama are nearly the same.

However,  if Romney is elected, four years from now the US may face the disastrous choice of Hillary Clinton vs. four more years of Romney. That thought alone should be enough to make any sensible US citizen throw up.

The beauty of an Obama second term win is Obama is guaranteed to be gone four years from now whereas the US could conceivably be stuck with Romney for eight more years.

Rand Paul 2016

Should Obama win, Republicans will have the chance to get their heads screwed on straight and nominate a candidate with broad appeal to the center as opposed to broad appeal to the far right.

Rand Paul 2016 has a nice ring to it (assuming he has the common sense to stay away from war-mongering and abortion like his father Ron Paul).

However, Rand Paul (or if you prefer, NJ governor Chris Christie)  will only be possible if Obama wins this election.

Thus, short of a miracle finish by Ron Paul,  the actual best hope for a sensible Republican candidate who appeals to the middle and the independents just might be four more years of Obama.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List


Damn Cool Pics

Damn Cool Pics


Unique Sketched Tattoos by Peter Aurisch

Posted: 24 Apr 2012 03:15 PM PDT

Peter Aurisch is a tattooer with a very interesting style, he is based in Berlin, Germany. His tattoo designs have a distinctly designer look to them; so incredibly different than the standard ink on the street. His work melds both modern and reinterpreted classic themes, often combining intricate line drawing with carefully chosen overlapping layers of bold color.
























Via: inkbutter


18 Year Old Has Britian's Most Beautiful Face

Posted: 24 Apr 2012 01:15 PM PDT

Florence Colgate has been dubbed "Britain's Most Beautiful Face," and there's science backing the claim up.

The winner of a Britain-wide beauty contest sponsored by Lorraine Cosmetics, Colgate has mathematically perfect looks, according to statistics reported by the Daily Mail. Not only is the 18-year-old's visage perfectly symmetrical, but she has the "optimum ratio" between her mouth, eyes, chin, and forehead.
















The Case for Beer [Infographic]

Posted: 24 Apr 2012 01:08 PM PDT

Beer and wine both can be wholesome elements of a healthy lifestyle, but they can become decidedly unwholesome if drinking becomes excessive. Excessive drinking is not only detrimental to your health, it's expensive, and can easily become a drain on your finances if you're not careful. However, when enjoyed responsibly and in moderation, some studies are beginning to show that beer can be as heart healthy as wine, and bears some other potential health benefits as well.

Read on to discover the case for responsible beer drinking, as well as some helpful tips on food pairing and optimal serving temperatures. In my opinion, if you slow down and enjoy it fully, at the right temperature and with some nicely complimentary food, you'll be far less likely to enjoy it in excess, and far more likely then to reap the positive benefits of beer. Of course, you should always consult your doctor about what is most beneficial for your own health. Enjoy, I hope you find it informative.

Click image to see a larger version.
Beer Infographic

Source: FrugalDad.com



Fearless Cat Shows Bear Who's Boss

Posted: 23 Apr 2012 09:21 PM PDT



A group of bears looking for their next meal stumble upon a delicious cat. Funny enough, the cat defends itself and the bear gets scared and runs away.


The Kitten Covers

Posted: 23 Apr 2012 02:47 PM PDT

The Kitten Covers are re-imagined legendary album covers from "from a world dominated by kittens" made by Aym Visuals. Do you have a favorite? Let us know in the comments!