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Several Lenders To The Low Income Rise To New Highs … Homebuilders Become New Risk Trade Replacing Silver … Japan Records A Trade Deficit In October Portending A Sovereign Event … A North American Union Forms By Leaders' Agreement

|Includes:DHI, EWJ, LEN, MTH, Nicholas Financial, Inc. (NICK), PHM, RCII, RYL, TOL, WRLD, XHB
Financial Market Report for Tuesday December 20, 2011

Several lenders to the low income rose today to new highs. These include, subprime automobile lender Nicholas Financial, NICK, PE of 7.7, durable good lender Rent-A-Center, RCII, PE of 16.0, and pay day lender World Acceptance, WRLD, PE of 11.9. These are leaders in the small cap revenue market as is seen in the chart of RWJ, NICK, RCII, and WRLD.

Home builders, DHI, LEN, TOL, PHM, RYL, and MTH, become the new risk trade replacing silver, as is seen in the Yahoo Finance chart of XHB, DHI, LEN, TOL, PHM, RYL, MTH

Japan’s exports break down, portending a soveign event for this debt ridden country as Japan has a Debt-to-GDP ratio exceeding 200%. An inquiring mind asks, how is Japan going to service its national debt now that it has a trade deficit? Is Japan a credible sovereign nation and able to sustain its debt sovereignty? Will Japan experience a sovereign event in the near future? Trading Economics reports Japan Records Trade Deficit in October. Japan's trade slipped back into deficit territory in October after recording a surplus the previous month, The Finance Ministry said in a preliminary report on November 21. Japan posted a trade deficit of 274 Million Yen. Exports were down for the first time in 3 months, a 3.7-percent decline from a year earlier, while imports rose 17.9 percent. Delayed shipments of semiconductors and other electronics components led the decline in exports. Adding to the strong yen and supply chain disruptions due to the Thai floods, a slowdown of the global economy is creating a drag on Japanese exports. Higher crude oil prices led the rise in imports, along with an increase in imports of liquefied natural gas for power generation to make up for halted nuclear power plants.

Reuters reports BOJ Keeps Policy Steady, Offers Bleaker View On Economy. Slowing exports, worsening business sentiment and soft capital spending are challenging the central bank's view that the world's third-largest economy will recover early next year. In a sign of the growing damage from the global slowdown, Japan's exports fell at their fastest annual pace in six months in November with shipments to Asia declining on weak demand for semiconductor chips and digital cameras.

Japan to nationalize Tepco. Reuters reports Japan To Take Over Two Thirds Stake In Tepco

A US And Canada Leaders’ Framework Agreement further integrates North American countries along the 1974 vision of the Club of Rome for regional global governance. Dana Gabriel writes in Global Research The North American Homeland Security Perimeter Is A Threat to Canada's National Sovereignty. After months of negotiations, the U.S. and Canada have unveiled new trade, regulatory and security initiatives to speed up the flow of goods and people across the border. The joint action plans provide a framework that goes beyond NAFTA and continues where the Security and Prosperity Partnership (NYSE:SPP) left off. On December 7, President Barack Obama and Prime Minister Stephen Harper announced the Beyond The Border Perimeter Security And Economic Competitiveness Actin Plan. The new deal focuses on addressing security threats early, facilitating trade, economic growth and jobs, integrating cross-border law enforcement, as well as improving infrastructure and cyber-security.

It will act as a roadmap with different parts being phased in over the next several years. This includes the creation of various pilot projects. Many aspects of the agreement will also depend on the availability of funding from both governments. In addition, the two leaders issued a separate Regulatory Cooperation Council Action Plan that sets out initiatives whereby the U.S. and Canada will seek greater regulatory alignment in the areas of agriculture and food, transportation, environment, health, along with consumer products. At a Joint News Conference, President Obama declared that, “Canada is key to achieving my goal of doubling American exports and putting folks back to work. And the two important initiatives that we agreed to today will help us do just that.” He went on to say, “we’re agreeing to a series of concrete steps to bring our economies even closer and to improve the security of our citizens.” Obama also added, “we’re going to improve our infrastructure, we’re going to introduce new technologies, we’re going to improve cargo security and screening.” Prime Minister Harper proclaimed that, “These agreements create a new, modern order for a new century. Together, they represent the most significant steps forward in Canada-U.S. cooperation since the North American Free Trade Agreement.” He explained that, “The first agreement merges U.S. and Canadian security concerns with our mutual interest in keeping our border as open as possible to legitimate commerce and travel.” Harper described how, “The second joint initiative will reduce regulatory barriers to trade by streamlining and aligning standards.”

Some of the measures found in the Beyond the Border action plan include conducting joint, integrated threat assessments; improving cooperative law enforcement capacity and national intelligence- and information-sharing; cooperating on research and best practices to prevent and counter homegrown violent extremism; working to jointly prepare for and respond to binational disasters and enhancing cross-border critical infrastructure protection and resilience. Other facets of the deal will work towards adopting an integrated cargo security strategy; implementing entry and exit verification; establishing and verifying the identity of foreign travellers to North America; better aligning Canadian and U.S. programs for low-risk travellers and installing radio frequency identification technology at key border crossings.

As part of the agreement, both countries will, “implement two Next-Generation pilot projects to create integrated teams in areas such as intelligence and criminal investigations, and an intelligence-led uniformed presence between ports of entry.” This will build on past joint law enforcement initiatives such as the Shiprider program and the Integrated Border Enforcement Teams. The Next-Generation pilot projects are scheduled to be deployed by the summer of 2012. In September, U.S. Attorney General Eric Holder revealed plans that would allow law enforcement officers to operate on both sides of the border. He announced that, “the creation of ‘NextGen’ teams of cross-designated officers would allow us to more effectively identify, assess, and interdict persons and organizations involved in transnational crime.” Holder also commented that, “In conjunction with the other provisions included in the Beyond the Border Initiative, such a move would enhance our cross-border efforts and advance our information-sharing abilities.”

In August, the Conservative government released two reports which summarized online public input received concerning regulatory cooperation, as well as perimeter security and economic competitiveness. While improving the movement of trade and travel was the priority for business groups, many individuals expressed concerns over the loss of sovereignty, along with the protection of personal information.

By all accounts, big business is the winner in the new trade and security perimeter deal. Maude Barlow explained that, “this process has been set up to accommodate one sector of our community and that is big business.” In advance of the action plans being unveiled to the public, business stakeholders were briefed on the specifics. The Canadian Council of Chief Executives, an organization that lobbies the government on behalf of Canada’s largest corporations has given it their stamp of approval. The U.S. and Canadian Chambers of Commerce also applauded the new vision for border and regulatory cooperation. When it comes to negotiations on the border security agreement, Barlow confirmed that, “the big business community was the only sector at the table with government and guided the process from the beginning.”

In her Ottawa Citizen article, Maude Barlow warned that when it comes to the perimeter deal, “Canada is essentially giving up policy control in the key areas of privacy, security, immigration and surveillance in order to entice the U.S. to loosen controls at the border.” She stated, “it is likely to lead to a wholesale replacement of Canadian privacy and security standards with American ones, set by Homeland Security.”

When it comes to information being collected and stored, Barlow questioned whether it will be, “used as a form of social control, to identify not terrorists, but activists and dissenters of government policy.” She insisted that, “We must call on our government to create a full public and Parliamentary debate before this deal becomes operational.” From the beginning, the whole process has lacked transparency with no congressional or parliamentary oversight. This has drawn comparisons to the SPP which was shrouded in secrecy and fueled by fears over the loss of sovereignty that finally led to its downfall. We can only hope that this latest endeavour will meet the same fate. With the 2012 U.S. election cycle about to get into full swing, the new bilateral deal could get lost in the shuffle.

While the perimeter agreement is being sold as vital to the safety and prosperity of Canadians and Americans alike, there is little doubt that it will mean a trade off between sovereignty and security. Any deal which gives the Department of Homeland Security more personal information poses a serious risk to privacy rights. As both countries move forward, perimeter security will be further defined and dominated by American interests. This could force Canada to comply with any new U.S. security measures, regardless of the dangers they may pose to civil liberties. A North American Homeland Security perimeter goes well beyond keeping people safe from any perceived threats. It is a means to secure trade, resources, as well as corporate interests and is a pretext for control over the continent. Ultimately, the U.S. wants the final say on who is allowed to enter and who is allowed to leave.

A Global Eurasia War is coming soon. Stephen Lendman writes in Global Research Washington's Greater Middle East Agenda Is A Middle East War The US seeks a greater overall regional footprint to establish an enhanced security architecture to integrate air, ground, and naval units for future combat missions. DEBKAFile said American special forces troops have been diverted to positions in Jordan opposite a Syrian tank concentration building up across the kingdom's northern border. In addition, America's naval presence includes additional warships and attack boats, perhaps there for combat, not saber rattling. Sibel Edmonds said NATO forces have conducted training operations near Syria's border since May. Washington claims Tehran threatens world peace, saying its commercial nuclear program plans nuclear weapons development.