Wednesday, May 2, 2012
Eurozone jobless rate hits record high
Have it clear that the Bible says things will get worseso get ready.
They have been saying that things are improving butthe situation gets worse and worse
They have been saying that things are improving butthe situation gets worse and worse
Unemployment in the eurozone reached a record high again in March as spending cuts continued to hit the working population.
For all 17 nations in the eurozone, the jobless rate rose again to 10.9%, the highest since the euro was formed in 1999, Eurostat said.
For the eurozone, 17.4 million are now looking for work and more than 3 million of those are under 25.
Italy's unemployment rate reached a 12-year high, up to 9.8%.
And in a surprise move, the jobless rate in Germany rose to 6.8% in March, official figures showed, having been expected to stay at the previous month's 6.7% after six months of declines.
The number of Germans out of work is now at 2.87 million.
For the whole of the European Union, including countries such as the UK and Denmark, the jobless rate is 10.2%.
The data pushed shares in Europe lower, with stocks in Madrid falling 2.6% to close at the lowest in three years.Austerity or growth
Last week, Spain said that the number of jobseekers rose for the eighth month in a row in March to hit 5.6 million, a record rate of 24.4%.
Spain has the highest unemployment rate in the European Union and it is expected to rise further this year.
Spain and Italy are both in recession and have seen borrowing costs rise, raising the prospect that they may need help or even bailouts.
A debate is raging in Europe about whether politicians have prioritised austerity at the expense of economic growth, making recovery even harder for themselves.
Eurostat said that the EU member countries that had the biggest falls in unemployment in the past year were on Europe's eastern fringe - Lithuania, Latvia and Estonia.
Those with the biggest increases were Spain, Greece and Cyprus.
Separately, a survey of eurozone manufacturing indicated that the sector slipped further into decline last month as new orders fell for the 11th straight month.
Markit's manufacturing purchasing managers' index (PMI) dropped to 45.9 in April, from 47.7 in March, its lowest reading since June 2009. A reading below 50 indicates contraction in the sector.
BBC
5 active volcanoes you should keep your eye on
Italy's Mount Etna and Mexico's Popocatepetl volcano have been huffing and puffing their way into the news recently, spewing plumes of ash and dribbling lava in the latest flare-ups of eruptive activity that have been going on for years in the case of both volcanoes.
While larger eruptions, such as the the Philippines' Pinatubo in 1991 and the 1980 blast of Mount St. Helens in Washington, are more famous for the disruptions they caused, some near-constant eruptions have their own associated hazard, posing threats to nearby communities and potential disruptions to air traffic from ash plumes.
Here are five volcanoes that don't always get a lot of fanfare, but have been quietly (or maybe not so quietly) rumbling and spitting up volcanic material continuously for years — even decades — in order of the number of years they've been erupting.
5. Sangay in Ecuador — 94 years The modern volcano structure, which reaches a height of 17,158 feet (5,230 meters), dates back about 14,000 years and was built within horseshoe-shaped calderas, or volcanic depressions, of two previous edifices that collapsed and caused avalanches. The earliest report of a historical eruption here was in 1628; then more or less continuous eruptions were reported from 1728 until 1916. The volcano started up again in 1934 and hasn't stopped since.
4. Santa Maria, Guatemala — 101 years Santa Maria is a 12,375-foot-tall (3,772-meter) stratovolcano that towers over Guatemala's Pacific coastal plain. It erupted catastrophically in 1902, one of the largest eruptions of the 20th century, causing severe damage throughout southwestern Guatemala and carving a crater on the volcano's flank. A lava-dome complex, called Santiaguito, has been forming in the crater since 1922.
3. Stromboli, Italy — 108 years Stromboli is the tip of a massive underwater volcano that has been erupting nearly continuously for more than 2,000 years. The explosive style of eruption displayed by it and other volcanoes is known as "Strombolian." A 2002 eruption caused a small tsunami and damaged a village on the island, which lies off the coasts of Italy and Sicily.
2. Mount Etna, Italy — 109 years Dating back to 1500 B.C., the volcano has erupted about 200 times. The mountain is currently around 10,958 feet (3,340 meters) high and is the largest active volcano in Europe. The most violent eruption in the history of Mount Etna occurred in March 1669. The volcano spewed molten rock for days on end; the eruption finally stopped at the end of April that year.
1. Mount Yasur, Vanautu — 111 years This stratovolcano is part of the archipelago nation of Vanuatu in the South Pacific. Yasur has been erupting nearly continuously for over a century, and its eruptions, which often occur several times an hour, are classified as Strombolian or Vulcanian (a relatively low-level type of eruption).
MSNBC
Total US Debt Soars To 101.5% Of GDP
There is nothing quite like a $70 billion debt auction settlement at the last day of a month to bring total US debt to a record $15.692 trillion, which happens to be just $600 billion shy of the $16.394 trillion debt ceiling. (and no, contrary to simple economic textbook lesson, this does not mean that the private sector just got another $70 billion in debt capacity courtesy of taxpayers, as explained here). And now that we know what Q1 GDP was at the end of Q1, or namely $15.462 trillion, it is simply math to divine that today alone total US/debt to GDP rose by 50 bps to a mind boggling 101.5%.
Below is a chart of two lines with different slopes. We leave it up to readers to figure out which line is GDP and which is total debt.
And as noted yesterday, now that the end of month auction has settled, one can easily see why the Treasury forecast of debt issuance through the end of September will only be correct if somehow the Treasury finds a way to print its own money without reliance on the Fed, or else every US taxpayer somehow hikes their tax payments by 15% voluntarily. Good luck on both counts.
Then again who cares about the short term. Here is what the total US debt/GDP will look like, frankly under either administration as both the presidential candidate and the incumbent have absolutely no idea how to fix an excess debt problem without issuing more debt (nor do they have any interest to).
And for those who still believe that insurmanoutable debt is suicide, we have good news, you are right, at least according to a new paper by Reinhart, Rogoff and Reinhart (via The American):
– We identify 26 episodes of public debt overhang–where debt to GDP ratios exceed 90% of GDP–since 1800. We find that in 23 of these 26 episodes, individual countries experienced lower growth than the average of other years. Across all 26 episodes, growth is lower by an average of 1.2%.
– If this effect sounds modest, consider that the average duration of debt overhang episodes was 23 years. In 11 of the 26 high debt overhang episodes, real interest rates were the same or lower than in other periods.
– Obviously, it is possible that new developments in technology and globalization will provide such a remarkable reservoir of growth that today’s record debt burdens will eventually prove quite manageable. On the other hand, the fact many countries are facing “quadruple debt overhang problems”—public, private, external, and pension–suggests the problem could in fact be worse than in the past, a question we do not tackle here.
– Nor have we paid attention here to the likely possibility of significant “hidden debts”, especially public sector, which Reinhart and Rogoff (2009) find to be a significant factor in many debt crises, and as documented in detail in the Reinhart (2010) chartbook. Another line of reasoning for dismissing concerns about public debt and growth is the view the causality mostly runs from growth to debt.
– Our analysis, based on these cases and the 23 others we identify, suggests that the long term risks of high debt are real.
Zero Hedge
DOES 'FREEDOM TOWER' HEIGHT FULFILL PROPHECY?
News this week that the new World Trade Center Freedom Tower surpassed the height of the Empire State Building to become New York’s tallest building is stirring even more interest in America’s bestselling Christian book and video documentary – both of which contend the country is missing the spiritual warning of 9/11 by simply building higher, bigger and stronger structures after the worst attack on the homeland in history.
The Freedom Tower isn’t expected to reach its full height for at least another year. When complete, One World Trade will stand at 1,776 feet, which includes a 408-foot-tall antenna spire that will sit on its roof. Discounting the antenna, it will still be the second-highest building in the U.S., after the Willis Tower in Chicago.
In January, Jonathan Cahn’s book “The Harbinger” skyrocketed to the top of the New York Times bestsellers list by suggesting America was following in the defiant footsteps of ancient Israel as recorded in Isaiah 9:10 by insisting on rebuilding bigger and better without considering what God was trying to tell the country
It was on Monday the rising tower passed the height of the Empire State Building with the installation of a vertical structural beam. The date, April 30, also is a key date revealed in Cahn’s “The Harbinger,” concerning the mystery of Ground Zero.
In March, WND Films released“The Isaiah 9:10 Judgment” as a documentary followup to Cahn’s stunning research revealing the eerie parallels between the reaction of ancient Israel to a similar attack and those of national leaders in the U.S. It quickly became the No. 1 faith video in America.
The video has received broad praise from leading Christians, including one of the entertainment world’s biggest and most enduring stars, Pat Boone.
“God bless you for ‘The Isaiah 9:10 Judgment.’ It’s absolutely fabulous! The content and the production are so well done,” Boone said. “In fact, Shirley and I are ordering a dozen or more to send to close family and friends – after which we’ll probably need scores more. Every Christian, every American needs to see this!”
Christian media critic Ted Baehr called it “extraordinary, compelling, dramatic.”
Author Ray Comfort called the documentary “a powerful, inspiring trumpet-blast of thought-provoking biblical truth.”
“The Isaiah 9:10 Judgment” is an unusual documentary, told through the eyes of messianic Rabbi Jonathan Cahn, author of the No. 1 bestselling Christian book of 2012,“The Harbinger.” It tells the remarkable story of striking parallels between the judgment of ancient Israel for turning its back on God and those judgments facing America today – specifically since Sept. 11, 2001.
WND
Smart Money Banking Big On Gold & Silver Prices To Soar
Dominique de Kevelioc de Bailleul: Short positions positioned by the smart money
stand at the lowest level since the start of gold‘s near-double in price and silver‘s near-triple price surge of 2009.In the most recent release of the Commitment of Traders (COT) report, the data show commercial traders now expect gold and silver to stop falling. But more to the point, historical data suggest that when commercial traders, the ‘smart money’, cuts back on their short positions to low levels on a relative basis, precious metals prices have risen, and sometimes, and most recently, in a violently manner.
For week ending Apr. 24, 2012, gold market commercial traders reduced their short position to 316,231 contracts, an amount not seen since gold‘s historic breakout above the $1,000 mark in Sept. 2009. Gold, then, proceeded to rally 92 percent throughout a 23-month rampage, as traders fled to the metal during the Federal Reserve’s ‘Quantitative Easing’ policies of QEI, QEII and ‘Operation Twist’.
Silver prices, after struggling below the $15 level in 2009, broke out to the upside to test the $20 mark in Aug. 2010 for a 33 percent gain, before surging through $20 in Sept. 2010 on its way to a continuation of a breathtaking 232 percent rally from the initial breakout above $15.
“ . . . large commercial traders have greatly cut back their short positions in gold and especially in silver,” global precious metals specialists GoldCore wrote in an open letter to traders. “This has often been a sign of a bottom and suggests that they do not expect gold and silver to fall much further.”
GoldCore went on to state that, for the week ending Apr. 2012, COT data show that speculators (dumb money) have reduced their net long positions to 107,600 contracts, a meager amount not registered at the CFTC since Jan. 2009. At that time, gold and silver traded calmly at $900 and $12.50, respectively. Then came the fallout of the Lehman collapse and QE announcements from the Fed that followed. That’s when the fireworks began.
As Europe teeters on the brink of a Lehman collapse “times 1,000”, a threatening financial Armageddon of proportions never witnessed in modern times, expectations for more QE to match the magnitude of a Lehman-times-1,000 event grow each day, according to precious metals expert Keith Barron.
“Spain is in a tremendous amount of trouble right now. They have had a lot of their major banks downgraded,” Barron told King World News, Monday. “The country’s debt has been downgraded, yet again . . .
“The unemployment rate is now almost one in four people, it’s just over 24%. If this place was in South America, they would be verging on revolution right now . . . Maybe that’s coming.
“Greece is certainly not out of the woods. We know that Portugal is in big trouble too. The fear is that things are going to start spreading to Italy, that’s the big shoe to drop….”
And that shoe could make investors of precious metals rich, according to legendary newsletter writer Richard Russell of Dow Theory Letters. He said the rich have been buying precious metals in preparation of the collapse of the Europe Union—and by extension the United States, as the two largest economies of the world have never, and will not, decouple from each other—a point grossly underplayed by mainstream media financial programming.
In essence, Europe’s $16 trillion economy will in the end mostly likely serve up to be the United States’ PIIGS. As far back as the Greatest of Depressions, the 1873-1896 Depression, the Panic of 1907, the mini-Depression of 1921, and the Great Depression of the 1930s, Europe and the US have always collapse together after mutual economic prosperity and asset-price inflation.
That historical context may easily explain the urgency by the Fed to egregiously open currency swap lines with Europe to the tune of more than $500 billion and fund the International Monetary Fund in a backdoor bailout plan for Spain, Portugal, Italy, and again, Greece—providing concrete evidence to support Jim Sinclair’s “QE to infinity” mantra.
Richard Russell sees it that same way as Sinclair—mutual destruction on both sides of the Atlantic and central banker policy response to match.
“Technically, both the US and Europe are dead broke, and their GDPs would have to run wild on the upside to make the debt to GDP ratio more acceptable,” Russell penned in his daily commentary to investors of last week. “How will it all end?
“It will end with the central banks churning out junk fiat inflation-adjusted ‘money’ in order to service the debts. Meanwhile, the precious metals and other tangibles are being bought up by millionaires and billionaires as they await their turns to feast on the remnants.”
But unlike the Great Depression of the 30s, Russell sees Fed Chairman Ben Bernanke and other central bankers from the G-6 nations inflating in an effort to avoid systemic price deflation—a scenario which Bernanke vowed will never happen under his watch.
“During the Depression [of the 1930s] wealthy individuals husbanded their dollars, and later got rich buying the battered remains of the Jazz Age of the twenties,” Russell ended his piece. “It may not be that easy and cut and dried this time around. This time history may not Rhyme.
In other words, don’t count of a Bernanke-led Fed to withhold the monetary spigots of ever-more money printing. The smart money is banking big on it.
Related: SPDR Gold Trust (NYSEARCA:GLD), iShares Silver Trust (NYSEARCA:SLV), ProShares Ultra Silver ETF (NYSEARCA:AGQ), ProShares UltraShort Silver (NYSEARCA:ZSL), iShares Gold Trust (NYSEARCA:IAU), ETFS Gold Trust (NYSEARCA:SGOL).
ETF Daily News
Iranian naval exercise follows on Israel’s northern border drill
Israel’s Defense Minister Ehud Barak offered the view this week that the next round of Six-Power talks with Iran taking place on May 23 in Baghdad would lead nowhere, throwing cold water on the current optimism. As for US media reports of a lessening in war tensions over Iran because of the internal debate in Israel over an independent attack, they were soon overtaken by significant military steps embarked on Tuesday, May 1, by the US, Israel and Iran.
The large-scale Israel Defense Forces war game on the borders of Syria (Golan) and Lebanon was quickly followed by naval drills along Iran’s southern Persian Gulf coast by its border guards. Tehran was making good on the policy agreed with Syrian and Hizballah allies in early 2011 to counter any Western or Israel military movement in the region with a comparable response.
Israeli army spokesmen were cagey about the scale and nature of the exercise beyond preparing people living in the north for heavy military traffic on regional highways and the sounds of gunshots and explosions.
DEBKAfile’s military sources disclose that the IDF drilled a strengthened, proactive presence in the North to meet al Qaeda’s looming presence and expanding operations next door, especially in Syria, and the threat of the Syrian civil war spilling over into Lebanon.
Monday, Israel started building a defensive wall 10-meter high, 2 kilometer-long along its border with Lebanon to protect the Israeli population and highways in northern Galilee from sniper fire coming from the Lebanese village of Kfar Kila in the Hizballah-dominated south. According to intelligence received, the Lebanese Shiite Hizballah plans to lash out against Israel in the hope of recovering its waning popular support as a result of its tight bonds with the hated Bashar Assad. Snipers are to pick off Israelis in cross-border fire and so provoke a major firestorm that will take the world’s attention away from the savagery in Syria.
Just as Israel estimates that the Galilee Panhandle and Golan could become flashpoints for exchanges of cross-border fire, so too Iran is taking into account that an operation to destroy its nuclear facilities may also entail landings on its southern coast by American and Israel special forces, and maybe others too.
Gen. Hossein Zolfaqari, Commander of the Iranian Border Guards, was more forthcoming about the exercise he is leading than Israel’s army spokesmen. He announced that the naval maneuver codenamed “Fajr” would exercise the latest tactics in border protection with the participation of the border guard units of the provinces of Bushehr (site of Iran’s only nuclear reactor and parts of its uranium enrichment facilities), the Persian Gulf Kish Island (where big Revolutionary Guards bases at situated), Hormozgan (near the Revolutionary Guards main headquarters at Bandar Abbas) as well as Khuzestan and Sistan and Balochestan, Iran’s biggest oil regions.
Very much on the offensive, Tehran Monday claimed to have developed the technological expertise for “redirecting enemy missiles to a target which we will determine,” in the words of Brig. Farzad Ismaili, commander of the Khatam-ol-Anbiya (Last of the Prophets) Air Base. “This is the capability of electronic warfare in which it is we who program the enemy missile,” he boasted.
There was also an outpouring of comment from Tehran about last week’s deployment of US F-22 Raptors in the UAE’s Al Dhafra Air Base opposite Iran’s southern shores. One spokesman said they posed no danger to Iran and had been moved in for “psychological warfare;” another that they “threatened regional security” and Gulf nations should not allow foreign armies to take up position on their shores.
A week after the F-22 squadron was deployed in the Gulf, Elizabeth Sherwood-Randall, special assistant to President Obama and senior director for European affairs at the National Security Council, disclosed Monday that the completion of the initial phase of the US-backed missile network in Europe would be announced at the NATO summit meeting in Chicago on May 20.
She added that additional work is underway in the next phase of the network, designed for protecting Europe and the Middle East from Iranian ballistic missile attack.
The chronology is significant: The announcement that the US-led missile shield has gone operational will be made three days before the Six Powers and Iran resume nuclear negotiations in Baghdad.
Far from reducing war tensions over Iran, America has tossed the military ball into the Iranian court.
Pentagon is planning ‘contingency’ for Iran and North Korea
The U.S. military is discussing significant changes in its war plans to adhere to President Obama’s new strategic guidance that downplays preparing for conflicts such as Iraq and Afghanistan, and counts on allies to provide additional troops.
War planning for Iran is now the most pressing scenario, or what the Pentagon calls a contingency.
U.S. Central Command believes it can destroy or significantly degrade Iran’s conventional armed forces in about three weeks using air and sea strikes, according to a defense source familiar with the discussions.
Such strikes are an option in a response to Tehran’s striking U.S. and international ships in the Persian Gulf and attempting to close the strategic Strait of Hormuz, through which about one-fifth of the world’s oil is transported.
The Pentagon now is conducting a step-by-step surge of forces in the Gulf. It is maintaining two aircraft carriers in the region and is increasing the number of mine-detection ships and helicopters.
Aviation Week reported the Air Force recently dispatched its premier penetrating strike fighter, the F-22 Raptor, to a base in the United Arab Emirates, across the Gulf from Iran
A smaller, more agile force
Army Lt. Col. T.G. Taylor, a spokesman at U.S Central Command, which oversees military operations in the Gulf, said the command does not discuss war planning.
“We plan for any eventuality we can and provide options to the president,” Col. Taylor said. “We take our guidance from the secretary of defense and from our civilian bosses in D.C. So any kind of guidance they give us, that’s what we go off of.”
The defense source said the U.S. would respond to an invasion of South Korea by the North primarily with massive air and sea power. It would be up to the South Korean army to do most of the ground fighting, and it would have the lead in stability operations for a defeated North.
Overall, the U.S. military is reducing the planned number of U.S. ground troops that would be needed in a major conflict and is counting on allies to fill the gap.
It also is expanding the number of days it would have to begin fighting one war and blunt an aggressor in another region.
Mr. Obama presented his eight-page strategic guidance in January as his vision of a smaller, more agile armed forces that would focus on air and sea power in two regions — the Pacific and the Persian Gulf.
He presented the document a month before the Pentagon announced how it would grapple with $487 billion in budget cuts over the next 10 years. The hallmark savings: reduce ground forces by 90,000 soldiers and Marines.
The Obama guidance lists 10 “primary missions” for the armed forces. The guidance for counterinsurgency missions, such as Iraq and Afghanistan, is significant as much for what the military will not do as what it will do: “The United States will emphasize non-military means and military-to-military cooperation to address instability and reduce the demand for significant U.S. force commitments to stability operations,” it states.
Washington Times
Feds to impose ‘no-fly zone’ for small planes during NATO summit
A no-fly zone for Chicago has been issued for May 19th through May 21st. The ban is on non-commercial planes. Planes are not allowed to fly within 10 nautical miles of downtown Chicago and below 18,000 feet.
The only aircraft that may fly within this zone are regularly scheduled commercial passenger and cargo carriers.
There will also be temporary flight restrictions in an outer ring which will include the area between 10 and 30 miles of downtown Chicago. For this outer ring, only planes arriving or departing from local airfields will be allowed to fly. Flight training, seaplane operations and other types of flights are banned in the outer ring.
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