The main forecast of this morning are pretty simple, really. For one, I expect sometime either today, or next week, Gold will wake up to a $40 (or so) beat-down which seems to happen often enough at the end of the month. But this morning, in a fine reversal, gold is trying to break to the upside…
Still, within a week, I figure we could see gold back under $1,300….
And since that will mean international “hot money” will need less US paper to buy the Dow, it should result in the bottom give out from under the Dow and the S&P which are edging down toward their 50-day moving averages, although at glacial speed.
Still, today’s line in the sand is 1,701 and change on the S&P – last Friday’s close, and a mark less than that could spell further market downside next week. We shall see.
So for this morning, Mr. Cheerful is swilling decaf and looking at the just-released Personal Consumption and Expenditures report wondering how long before “the music stops” in the worldwide financial game of musical chairs…
“Personal income increased $57.2 billion, or 0.4 percent, and disposable personal income (DPI) increased $56.2 billion, or 0.5 percent, in August, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $34.5 billion, or 0.3 percent. In July, personal income increased $21.2 billion, or 0.2 percent, DPI increased $32.7 billion, or 0.3 percent, and PCE increased $18.3 billion, or 0.2 percent, based on revised estimates. Real disposable personal income increased 0.3 percent in August, compared with an increase of 0.2 percent in July. Real PCE increased 0.2 percent, compared with an increase of 0.1 percent.
Personal outlays — PCE, personal interest payments, and personal current transfer payments — increased $38.4 billion in August, compared with an increase of $22.2 billion in July. PCE increased $34.5 billion, compared with an increase of $18.3 billion. Personal saving — DPI less personal outlays — was $580.7 billion in August, compared with $562.8 billion in July. The personal saving rate — personal saving as a percentage of disposable personal income — was 4.6 percent in August, compared with 4.5 percent in July.
Go on, see if you know anyone who actually saved 4.6% of their income in August…send in examples please, because NO ONE I know is stacking cash at this kind of rate.
The Dow futures were down a bit when I looked but whether the 50 is crossed by the S&P toward the close is the one thing that really could matter today.
Go ahead, try saying it out loud a few times – this is one of those “conditioned response tests” which shows rats may be considerably smarter than humans. I’ve been sitting here in the client’s guest house this morning muttering this for a couple of hours now and “blond bombshell” keeps getting in the way or, the word just turn into verbal mush.
Fortunately, my application to be a speech pathologist was turned down, so I had to stay in the business track, which gets us (eventually – but I could go off even further into the weeds if you want) to this note from our Jakarta Bureau Chief:
Thought this article would grab your attention. Aren’t you expecting the world to end in October, led to Perdition by the bond markets?
Couldn’t hurt to listen to Paul Craig Roberts again…he sounds like you.
The question remains: Is the rupiah falling or the dollar rising? Is this a currency war?
Peace, love and happy motoring!
B, Jakarta Bureau Managing Editor
Come on! Everyone here knows enough never to count their chickens on Friday morning until two of them are over easy and the game of hide the sausage has been revealed by the disappearing hash browns.
What, huh? Hide the sausage, man! See next story.
Making Up Money
All of which wouldn’t matter so much except that today, Congress is scheduled to vote on a measure which would keep the US government solvent for a couple of more months.
In the interest of not spoiling your weekend, and not wanting to be the fellow who single-handedly brings down the whole US – Western – Globalist economic paradigm, I will skip the obvious remark about how “You’d be in jail if you made up money like this…” and end with the pleasant offer to “Print us up a few million. I promise to spend it…”
There’s no question that the continuing resolutions to keep government in business will happen and here’s why: If government shut down, and we discovered we could get along without it…well, that would be a bummer for all those who pretend to power, now, wouldn’t it?
So some bond shuffling, but the end of the world can’t happen until we’re back from our road trip and our timing rules absolutely prohibit an economic calamity until just ahead of Thanksgiving.
More after this…
Selling Global Warming
The Madison Avenue mentality is alive and well. Oh, sure the data says global warming has slowed over the past 15-years (which is shouldn’t have) but no money in that. So here comes another report on how global warming which is sure to be hotly debated.
I will be looking at the data when we get home from our present road trip, but my inclination is to see if the report backs out the obvious 11-year solar cycles and whether the intensity of the sun’s heat since the international geophysical year data collecting began back in the 1950’s has been studied.
OK, seriously: How many people (besides Ures truly) remember the IGY? Wikipedia:
The International Geophysical Year (IGY) was an international scientific project that lasted from July 1, 1957, to December 31, 1958. It marked the end, after Joseph Stalin‘s death, of a long period during the Cold War when scientific interchange between East and West was seriously interrupted. 67 countries participated, although one notable exception was mainland China, which was protesting against the participation of the Republic of China (Taiwan). East and West agreed to nominate the Belgian Marcel Nicolet as secretary general of the associated international organization.
The IGY encompassed eleven Earth sciences: aurora and airglow, cosmic rays, geomagnetism, gravity, ionospheric physics, longitude and latitude determinations (precision mapping), meteorology, oceanography, seismology, and solar activity.
Sooo…what to do? Skeptical Science has some good discussion of solar output versus global warming over here…And then there’s the matter of volcanism. But I have a ton of reading to do in order to take it all in.
Million Dollar Idea: I came up with a great bumper sticker, regardless:
“Reduce CO2 Emissions: Stop Breathing.”
Fedbux to Motown
$300-million in additional federal spending is on the way, but our bet continues (sorry Detroiters) to be against a robust city rising from the ashes of the auto industry.
Three Days Out
I still haven’t been told by my insurance outfit if my current healthcare coverage is q qualifying plan. Not that it matters since there may be some horse-trading going on in Washington where the repubs would give up on their budget ceiling in return for a one year delay in the personal Obamacare mandate.
Meantime, the Obama perpetration is using harsh lingo to push the sell: “
A fine example of statesmanship and working together in the national interest, if I’ve ever seen one.
Syria Still Stirring
While SecState Kerry is talking about warming talks with Iran, there are new reports over in Syria about chemical weapons use which the UN is looking into.
All of which is a “Who cares?” until Israel launches and they are being very QT for now. Except over here, of course.
Throwing Money at it?
Word that Turkey and the US are putting together a $200-million fund to fight terrorism has me scratching my head: How come we can’t bail out Detroit and we are setting up voc tech programs for would-be terrorist recruits?
Like, doesn’t what’s going on in our own frigging country matter? No wonder we’re broke and being kept alive on life support for the financial system.