George Ure

I have been telling you for a long time that deflation was the big bogeyman in America’s future, which is why there is such a hype to drag us into some kind of major conflict right now.  War is good for the economy and – if enough damage can be done – there’s economic stimulus, a basis for raising taxes, and government asserting even more control of individual humans who deviate from “offishul” group-think.

Now, part of the evidence of deflation has been that while prices have been going up as a roughly 2% rate in the consumer price index, I’ve been telling you that the Fed is increasing the money supply by dramatically higher levels.

But even old pessimistic Ures truly was not ready for the shocking pumping of the M1 money supply in last night’s M1 number in the weekly update to the H.6 money stocks report:

And, you’ll see that pumping of the broader M2 rate is going on at higher levels, too.

So, what does it mean?  Well, just that deflation is deepening and despite the worrywart end-of-worlders who are touting inflation and collapse of the dollar, I’ll tell you right now that as soon as Gold gets up to the $1,400 level, a reversal down toward $1,000 will become likely.

As you know, Robin Landry and I have been eyeing the $800 level in gold for a long time.  As news that IT’S DEFLATION NOT INFLATION, YOU IDIOTS seeps into mass consciousness, the US market will be set to slide to prices down around 2009 lows –and lower. 

The Dow is looking to open down nearly another 150 this morning…deflation is a disaster than usually ends in war….

Russia, Stocks, and Producer Prices

No, this is not as “sexy” as the building US-Russian standoff over Ukraine/Crimea or the aircraft search, we do, nevertheless, tend to put money first around here.  That’s because, as goes the money, so too goes all the rest.

We note this morning that the Russian stock market has been handed a 1.90% loss in trading so far today.  Earlier, the US market looked to add another 131 point loss in today’s trading.  We may issue a special update this afternoon for our Peoplenomics subscribers on what this week’s closing action has done to our Trading Model’s outlook.

Now, about them Producer Prices:

The Producer Price Index for final demand fell 0.1 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This decline followed advances of 0.2 percent in January and 0.1 percent in December. O

n an unadjusted basis, the index for final demand moved up 0.9 percent for the 12 months ended in February, the smallest 12-month rise since a 0.9- percent increase in May 2013. (See table A.) In February, the 0.1-percent decrease in final demand prices can be traced to the index for final demand services, which fell 0.3 percent.

In contrast, prices for final demand goods advanced 0.4 percent. Within intermediate demand, the index for processed goods climbed 0.7 percent, prices for unprocessed goods jumped 5.7 percent, and the index for services rose 0.2 percent.

The change in final demand for the past 12 months being under 1% was obvious on the road trip Elaine and I just completed.  Truck traffic is noticeably down on Interstate 40 and we wouldn’t be surprised to see west coast port container volumes flatten when we run those numbers for subscribers next week.

Another taste of bile for the markets this morning:  China’s financial leadership is warning of a wave of bankruptcies to come there.  Reason?  Companies borrowed too much, and now with global demand for a lot of products level (to declining) we can see that Boom & Bust works in that “worker’s paradise” leftover from Chairman Mao, huh?

The Teflon Senator?

A report (over here) says the FBI has been blocked from taking part in a corruption investigation of senator Harry Reid  of Nevada and Mike Lee of Utah.

And who, according to the report, made this patently political decision to “protect the party”?  Why none other than Eric Holder, US Attorney General.

Also out today is another damning story about how the Justice Department has refused to release information on hundreds of prosecutorial misconduct cases.

I don’t know about you, but this sure as hell doesn’t seem very “transparent” when allegations against a couple of key senators is hushed up and when prosecutors guilty of misconduct are not named.

I’ve said it before, and I’ll say it again:  A fish rots from its head.  And that head is Holder.

Behind the Scenes on MH370

A well placed source tells me there is more going on to the MH370 case than  has hit the public news so far.  And while I don’t usually pass on “rumors” this one has high creds due to my source.

The source tells me that the information comes from a communications engineer for a certain large aircraft manufacturing company:

– an aircraft’s hourly ‘ping’ beacon cannot be turned off from the cockpit or passenger areas. One must climb below deck to switch it off.

– The manufacturer knows for a fact that the aircraft flew for FIVE hours after losing radar contact due to the hourly beacon ping

– the aircraft made ‘several’ turns during its ‘missing time’ (not clear how the engineer knew this)

– the US provided this info to several regional national authorities two days ago, with no action

– the US Navy ship now reported steaming to the Indian Ocean is headed directly to the identified aircraft location

– satellites confirm the aircraft (or whatever remains of it) is stationary and possibly in ‘deep water’ with no suspected survivors

This information dovetails precisely with the White House announcement that a new search area is being opened in the Indian Ocean for the plane.  US Navy craft going into the area would confirm the creds of my source on this, who has not be substantially wrong yet…Still, with stories like the Chinese reporting a land side seismic event, there is always the possibility that the source may not be right….

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One other airplane note:  That off “prophetic dream I had 11-days ago came true last night in Philadelphia…more in the Coping section…

Quake Spotting

Following the string of quakes up and down the eastern edge of the Pacific Tectonic Plate’s Ring of Fire, we can’t help but notice that chatter about the dangers of a “big one” out West are making the rounds again,

As of press time, a 6.3 in the Japanese islands was the biggest deal overnight.

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The reason we start off with the Retail Sales figures press release this morning is this old business school axiom that “Nothing happens until someone buys something…”  It’s also why you should strike to be in sales as a career, because this is where the money is, in almost any industry you care to name.

If you want to get rich, sales is, near, as I can figure, the shortest ladder to the top. 

We can talk more about this some other time, but with the sales figures this  morning, it seems on point.  Some of the highest returns in learning you can find are to be had from studying the fine art of selling.  And no, it’s not hard, but people, in general have a fear of rejection and there is a good bit of that in sales.  Once you get past the ego-slamming idea that not everyone is going to love you, what you find is the remaining few who do love you, can make you rich beyond dreams.

I guess that’s why there are so many “average” people in the work, right?

OK, so onto the press release:

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for February, adjusted for seasonal      variation and holiday and trading-day differences, but not for price changes, were $427.2 billion, an increase of 0.3 percent (±0.5%)* from the    
previous month, and 1.5 percent (±0.9%) above February 2013.  Total sales for the December 2013 through February 2014 period were up 2.3      percent (±0.5%) from the same period a year ago.  The December 2013 to January 2014 percent change was revised from -0.4 percent     (±0.5%)* to -0.6 percent (±0.2%).   

Yes, boys and girls, it’s the auto industry that is keeping America on life support.

Don’t look at retail sales in isolation, though.  The reason is that these figures are  counted on a dollar basis and not on a units sold basis.  The dollar figures are kicked all over hell’s half acre by a) the purchasing power of the dollar, b) inflation, c) taxes, d) supplier costs, and the list goes on from there. 

Still, any port in a storm and the trend is something you adjust the trim of your financial sales to:  When they start to fall, you look for safer harbor investments, and when in a rising trend, you can maybe think about growth stocks again.

The Markets

All of which gets us to how the world looks this morning, assuming your eyes are open enough to care.

Dow futures were up 30 – amazing what happen retail sales will do.

China and Japan were down again.  And China is under the key 22,000 level on the Hang Seng, so if the weakness persists into next week there, even though there may be some happy talk about things like Ukraine, it might be interesting to look at the rest of the world before working yourself into a bullish frenzy.

Looking at Europe in the early going today, the tea drinking kneelers were down a bit, and the huns and frogs were up a tad.  The inference is that no one in Europe has any clue what’s going on, but that should be evident from a quick glance at their shoddy system of government upon government…

I’m sorry, but when I look at the EU what I see is one of history’s cruelest jokes.  What Napoleon, the Kaiser, and Hitler could not hold together, is now being bubble gummed and babble-mouthed by latter day empire builders.  Only to have history make the point that 28 bankrupt countries are no better off than individual ones.

The whole point of the “trade deals” is that they provide the international bankster class with a kind of floating “check kiting” scheme which is fine, unless you live in Spain, Portugal, Cyprus, Greece,,,you keep a list, I hope? 

One could argue that it’s 27 and a half in the EU fold, since the Brits haven’t swallowed the whole bait, yet.  And it will soon be 28 and a half (or 29, depending on who’s scoring) when the mobgov of the Ukraine swallows the bait, which they will because they need loans and the old way to do that is to grovel to Brussels.

Which is why the power grab for Ukraine is so much like an addict’s “Just one more ounce/toke/drink” plea.  Like one more is going to fix anything.  It will seem to because here come the checks into the kiting pool, right?  Circular refinance, mark up, oh, it’s such a clever machine!

More important than anything else, Ukraine gives member states something to jointly worry about and since external enemies are how taxes for arms have been historically stolen from the workers (who just want to be left alone) the resurrected Evil Russian Empire is marketing, marketing, marketing.

And shortly it will be tax, spend, tax, spend, which is how people in power stay there.  Napoléon and the Kaiser should have been so clever.

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({Payson, AZ)  We’ll get to our usual ranting and raving about economic this and that’s after we note the two major earthquakes overnight.  One off Northern California and one down off Mexico.  Down toward the Guatemala border area.

Here’s the short data on both:

M6.9 – 77km WNW of Ferndale, California

The other one:

M5.8 – 37km SW of Santiago Pinotepa Nacional, Mexico

Now, since I’ve spent all weekend in a casino doing, ahem, statistical field research, why would I mention the earthquakes?  Well for one, Grady is just tickled pink since “quake” popped up in our data runs this weekend:  Nostracodeus correctly predicted a 6.9 quake (last night off California) published yesterday at www.nostracodeus.com.

Speaking of which, note from Grady this morning:

One of George Ure’s ‘Woo Woo’ moments happened to me today, when my cat found my hand crank radio in my Emergency supplies kit and brought it to me. What does it mean?

Beats hell out of me, but since there have been recent rains in SoCal and now some quakes, we seem to recall an old (nutter) theory that rains helps to “lubricate” fault lines and they might be followed by major quakes.  Did last year’s floods in Alberta do same-o up there?  Or, is the cat just looking for disco music?  We may never know…

Since both of these quakes today were underwater, no point to the rain mention, but SoCal and the Washington and Oregon (in fact up through Vancouver Island ) area?  Well, put it on your check list to see how the prepping items are holding and update your fresh water supplies…

The odds of this being a smart gamble are about like “insurance” bets here in the casino.  They don’t often pay off, but when they do, you will feel like a damn genius.  Motion along the eastern edge of the Pacific plate gets my attention. And Grady’s cat?  You figure that one out.

More after this…

Global Spending Binge Fallout Pending

A Bloomberg report that global spending has resulted in a pile of debt $100-trillion deep, as measured by the Bank for International Settlements may, or may not, mean something.

A look at overnight trading action suggests that the Big Boyz will have every reason to open the US markets about flat, then load up on short positions, and then drive the market down by afternoon.

The hint is a look at Asia where the Hang Seng was down 1.75% overnight.  And like they say, when China sneezes, the world gets the flu.

Japan was down 1% too, but give them time.  The week is young.

Europe is holding about steady, maybe waiting to find some suckers in the US – something which historically hasn’t been too difficult.

The news tickler file is about empty this week when comes to juicy items until Thursday when the retail sales figures come out.  We’ll watch that one with some amusement since one of these months the auto industry will not be able to hold things together for the US economy.

Friday’s Producer Prices are another item to keep an eye on.  Inflation in the pipeline could crater everything.  Or, give us a bounce if the week begins with a big flushing sound by this afternoon.

Big Lie Weekend

National Delusion is a fine thing and what better proof of its existence than Day Light Savings Time?  The Gothamist offers 22 reasons why we should stop lying to ourselves about what time it is.

There’s hardly any point to my mentioning this, however.  I mean we lie to ourselves about recovery, debt, the market going up forever, and there’s never going to be a Big One on the West Coast./

So what’s the problem with lying to ourselves about time, too, as long as we’re at it?

Smack Dab on Point

While it is nice to read that US Attorney Eric Holder is properly concerned about the increase in heroin deaths here in the US which have become something of an epidemic, he’s missing the point.

I’d suggest that Holder, et alia, go have a come-to-Jesus with the three letter agencies, the White House, and the Pentagram about who was guarding those poppy fields in the Stans, know what I’m sayin?

That heroin ain’t coming from Vermont…

Calling Out TIME on NK

As long as we’re in the “getting real about shit” Monday mode, here’s a fine article in Time magazine about how North Korean elections are a “sham worth studying.”

In the interest of fairness, how about we lobby TIME to do a mathematical study to disprove (if it can be) Ure’s Theory of Elections which states that the public is no longer represented in the electoral process in the US?

You see, the out of state money is going to blow out whoever gets in the way of our powerful congressoid running for reelection.  And the out of state dough from the dark pools own pretty much every position of power among the Fools on the Hill.

And what they don’t control outright is handled by the K Street  Mafia that move votes out of retirement homes and deals in favors for votes in virtually all legislation.

That’s no more a “democratic republic” than most of those we’re throwing rocks at or shooting at, is it?

Elections have gone eBay and I think TIME (or The Atlantic) could score massive points with the sixteen remaining thinking people in ‘Merica by running the numbers.

If they don’t, I’d point the editors to Matthew 7:3-5 after questioning elections in (pick as many as you please here) Egypt, Ukraine, Crimea, North Korea, yada, yada…

(And no, there’s nothing preachy about that passage at all.  There’s a lot of just plain common sense around if you know where to look for it.  But most people are so bound up in their own beLIEfs that they can’t see the Acres of Diamonds around them.)

Crimea River

Russians are tightening their grip on the Crimea and the Ukrainian mobverment is trying to get the US and EU dragged into a showdown with Vlad Putin.

Looks to me like the next move will be putting a soft, but then hardening border, between Ukraine and Crimea.  By the end of this week, or next, headlines should be flaring again.

And thanks to reader Michael for the note:

Just chuckling here on how good your ‘trouble after Olympics’ prediction was!

It’s not exactly the Ruy Lopez figuring this stuff out.  Divide country or share mushroom pie.

Mass Transit Numbers Up

Seriously worthwhile press release from the American Public Transportation Association:

In 2013 Americans took 10.7 billion trips on public transportation, which is the highest annual public transit ridership number in 57 years, according to a report released today by the American Public Transportation Association (APTA). This was the eighth year in a row that more than 10 billion trips were taken on public transportation systems nationwide.  While vehicle miles traveled on roads (VMT) went up 0.3 percent, public transportation use in 2013 increased by 1.1 percent.

“Last year people took 10.7 billion trips on public transportation.  As the highest annual ridership number since 1956, Americans in growing numbers want to have more public transit services in their communities,” said Peter Varga, APTA Chair and CEO of The Rapid in Grand Rapids, MI.  “Public transportation systems nationwide – in small, medium, and large communities – saw ridership increases. Some reported all-time high ridership numbers.”

Some of the public transit agencies reporting record ridership system-wide or on specific lines were located in the following cities:  Ann Arbor, MI; Cleveland, OH; Denver, CO; Espanola, NM; Flagstaff, AZ; Fort Myers, FL; Indianapolis, IN; Los Angeles, CA; New Orleans, LA; Oakland, CA; Pompano Beach, FL; Riverside, CA; Salt Lake City, UT; San Carlos, CA; Tampa, FL; Yuma, AZ; and  New York, NY.

Since 1995 public transit ridership is up 37.2 percent, outpacing population growth, which is up 20.3 percent, and vehicle miles traveled (VMT), which is up 22.7 percent.

“There is a fundamental shift going on in the way we move about our communities.  People in record numbers are demanding more public transit services and communities are benefiting with strong economic growth,” said APTA President and CEO Michael Melaniphy.

“Access to public transportation matters,” continued Melaniphy.

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(Payson, AZ)   Although we are something like 1,200 miles from home this morning, there’s no shortage in the World of Woo-Wood (WoWW) on our present trip. 

But, as you’d expect from something as delicate and elusive as woo-woo, just how much is debatable.

Last Monday, for example, I told you about my “weird dream” about the airplane that made some kind of emergency landing because of a brake / hydraulic issues. 

I was saddened with the report of the Malaysian jetliner disappearance, but that wasn’t my dream.  No, this was definitely a dream about a passenger jet with 146 (roughly) people on board.

The event that mostly closely fit was the weekend emergency landing of a Japan Air Lines Boeing Dreamliner at Honolulu after a hydraulic warning light went one in flight eight hours out of Japan.

The plane didn’t have any issues landing, except that it was made with one engine out, which means the thrust-reversers would not be used, so a braking landing would have been in play – which would have meant a longer landing than normal.

But the number of passengers was about right, landing long (due to single engine) would have been a fit, but the icy runway (slipping) in my dream wasn’t there.  This took place in Honolulu, after all.

And this gets me to the first ponder of the week:  How do you score something like that?

Those who’ve been  reading this column long enough (or, is that too long?)  will remember that I had a dream prior to Gulf of Mexico Oil Disaster.  Again, there were some aspects of the disaster that were right (rig, fire, offshore, and the “Wall”.  But in my dream, there had also been a murder, or two, and the rig disaster was somehow covering that up.

As far as I know, there was nothing like that going on, so how would you score that?  And then the timing: Posting all this 18-hours before a disaster posting a semi-lucid dream with elements? 

Another weird note:  The airplane braking dream didn’t seem  particularly urgent to post.  But the oil platform fire dream…that one was a “stop the presses” kind of feeling.

This is precisely the kind of problem that has dogged the field of parapsychology since the get-go.  The study of the phenomena isn’t particularly difficult.  But the statistical back-up – OMG, now we’re talking real grownup number crunching.

Fortunately, not all cases are as complicated as me trying to pencil out the odds of strange dreams coming true based on one to n number of “correct” elements.

And example of the “WoWW in your Face” comes from reader Bill:

Aho George,

On a recent trip to California I found a small stone with a perfect hole in while walking along the beach. Being an old hippie, when I got home I looped a leather cord through the hole and then back through itself, tied it and put it around my neck.

I live at a hot spring and yesterday morning sitting out in my tub I felt something slide down the front of me. I reached up and found the leather cord whole and secure, so I figured the stone must’ve broken. When I picked it up it too was whole and fine. I had worn it the whole day before and through the night.

There is no way that the stone could have come off the cord.

I looped it back through and put it around my neck..

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