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schatzl

schatzl
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  • Germany's economy is beginning to show signs of recovery after probably shrinking in Q4, the Bundesbank says. "The largely stable labor market and a better outlook for output suggest that the economic weakness won't last all that long," the bank says. "Companies' expectations have noticeably improved, particularly the estimation of export opportunities," [View news story]
    "They don't get it. What Germany and the EU needs is massive monetary expansion. Instead they keep singing the all's well mantra."

    I'm slightly confused by your contribution.

    1. The EU is not a monetary union. Monetary expansion of € will have little direct effect on say the UK or Sweden.

    2. The Eurozone has experienced brutal monetary expansion via the ECB LTRO vehicle.

    3. It has never been proven that CB balance sheet expansion has created jobs in the US, UK, or Europe.

    4. The longer term repercussions of monetary expansion are unforeseen and uncontrollable.

    5. CBs and especially the Fed have an extremely poor track record in recognising and reacting in a timely fashion to bubbles.

    6. Monetary policies are not a fix-it-all for different economies around the globe.

    7. Currently Germany is by far the healthiest large western economy and has just declared a budget surplus.

    8. Ironically, Germany's success over the last 4 years is very much the result of unsustainable US and UK profligacy directly and indirectly via China and other exporters to the US as well as other net importers.

    German consumption and real wages have been flat-lining for over 10 years. GDP growth came solely over export growth, which has only been possible because of unsustainable consumption of its importing trading partners.

    So should the US actually try to live within its means, it will directly hit China and Germany hard. And Germany hard indirectly again as Chinese demand for industrial machinery and consumer goods wanes. Reminder: China has the largest trade deficit to other nations with Germany.
    Jan 21 01:20 PM | 2 Likes Like |Link to Comment
  • Algerian troops have stormed the gas plant in the Sahara desert that had been taken over by Islamist terrorists, killing all the militants. However, while 792 hostages survived, 23 were killed during the four-day siege. The terrorists' capturing of the facility, which is operated by Statoil (STO), BP and Algeria's state oil company, highlights the vulnerability of the operations of multinational energy firms in the Sahara. [View news story]
    Thank God you and me did't have any relatives over there then. That's a lot of dead hostages for being a good job. (Not that the situation could have warranted a different result though).
    Jan 20 01:26 PM | 2 Likes Like |Link to Comment
  • American Airlines (AAMRQ.PK), Delta (DAL) and United Airlines (UAL) are among the carriers whose flights to and from London's Heathrow Airport have been cancelled because of heavy snow. Overall, 260 flights were due to be scrapped today after over 400 were axed on Friday and well over 100 yesterday. No doubt the snowstorm, like the Queen's jubilee celebrations last year, will be trotted out to explain why U.K. GDP could have been higher. [View news story]
    Simply not true.

    Spend some time in Zuerich, Vienna or Oslo. They set standards. Most central to northern European cities are very well equipped. I've lived in Vienna (very high snow clearing capabilities and infrastructure), Hamburg (sub-par), Stuttgart (mediocre) and London (extremely poor) and worked across Europe.
    Jan 20 12:45 PM | 1 Like Like |Link to Comment
  • Caterpillar (CAT) will take a noncash impairment charge of $580M ($0.87/share) in Q4 after an internal investigation revealed accounting misconduct at recently acquired company Siwei Mechanical & Electrical Manufacturing Co. CAT -1.4% AH. (PR[View news story]
    No doubt, but this counts for those investing in Russia too. Great opportunities - especially in regards to growth potential. However, those super low p/e values are low because fraud, non-existent minority shareholder rights, opaque business structures and practices, have been discounted.

    Therefore, low p/e doesn't mean cheap. It means higher risk.

    My mom always used to say: there are no free lunches.
    Jan 20 10:29 AM | 2 Likes Like |Link to Comment
  • American Airlines (AAMRQ.PK), Delta (DAL) and United Airlines (UAL) are among the carriers whose flights to and from London's Heathrow Airport have been cancelled because of heavy snow. Overall, 260 flights were due to be scrapped today after over 400 were axed on Friday and well over 100 yesterday. No doubt the snowstorm, like the Queen's jubilee celebrations last year, will be trotted out to explain why U.K. GDP could have been higher. [View news story]
    Heavy snow/ snowstorm in the southern UK is in reality a few inches which wouldn't even be registered in most parts of the world that deals with snow on a regular basis.

    The southern Counties are spectacularly under-prepared. At some point they need to decide what is more costly: Investing in snow clearing gear and infrastructure that withstands mild quantities of snow, or their whole economy grinding to a halt for a few days.

    At least the latter option gives the government a cheap excuse should the economic data be disappointing.
    Jan 20 08:05 AM | 1 Like Like |Link to Comment
  • Gold Breakout In Process, Thanks To Germany [View article]
    Amazing how the concept of patriotism can get so abused.
    Jan 20 05:42 AM | Likes Like |Link to Comment
  • Caterpillar (CAT) will take a noncash impairment charge of $580M ($0.87/share) in Q4 after an internal investigation revealed accounting misconduct at recently acquired company Siwei Mechanical & Electrical Manufacturing Co. CAT -1.4% AH. (PR[View news story]
    So when the Chinese communist/totalitarian government whose existence relies in part on propaganda, announces 8% GDP growth, we can take it at face value? Sino-forest anyone? I'm not touching anything Chinese until the day we have a clear picture of what is really happening over there.

    The Gweilo is there to be ripped off.
    Jan 19 05:12 AM | 3 Likes Like |Link to Comment
  • Apple (AAPL) is reiterated a Buy with $760 price target at Goldman which says the company's opportunity in emerging markets is far greater than what investors give it credit for. A survey of Chinese owners of an iDevice finds 9 out of 10 at least "likely" to stick with an Apple product for their next purchase, and more than 3 of 5 "highly likely" to do so. [View news story]
    But Goldman Sachs reiterating their buy @ 760 is trustworthy and not manipulative? Since I don't have any insight into Apple, I can't contribute anything meaningful other than a general warning to try to avoid being a Goldman Sachs muppet.
    Jan 18 09:51 AM | 2 Likes Like |Link to Comment
  • Gold Breakout In Process, Thanks To Germany [View article]
    @Stephen Aniston

    Yes, and people who do not yet have an income stream and the chances of them getting income getting slimmer by the month as the unemployment rate remains stubbornly high and pensions lose their lustre due to ZIRP, so that people stay on their jobs longer to the detriment of those trying to enter.

    The situation is exacerbated by university fees becoming more expensive on the one hand and wages staying depressed on the other. Wages as % of GDP have been consistently falling for years.
    Jan 18 06:48 AM | 6 Likes Like |Link to Comment
  • Gold Breakout In Process, Thanks To Germany [View article]
    Though I'd love to see it happen, I very much doubt it. Their politicians are fully dancing to the Euro tune. I'm assuming simple contingency planning.
    Jan 17 12:32 PM | 2 Likes Like |Link to Comment
  • More on jobless claims: At 335K, it's the lowest read since January 2008. The 4-week moving average declines 6.75K to 359.2K. A Marketwatch report say seasonal quirks could be behind the big decline, without giving any detail. The news combines with the big housing starts print to send S&P futures +0.6%, 10-year Treasury yields to 1.87%, gold -0.6%, and the dollar higher across the board. [View news story]
    Or maybe those less optimistic actually do know what seasonal adjustment means and also know what initial unemployment claims means in the context of generationally low participation rates.

    While the number is good, it is in no way a conclusive sign of an improved job market.

    Too much trolling going on here. Let's up the standard.
    Jan 17 10:56 AM | 1 Like Like |Link to Comment
  • The euro is -0.2% at $1.3275 after Eurogroup Chairman Jean-Claude Juncker said last night that the currency "is dangerously high." The euro traded above $1.34 this week for the first time since February 2012, boosted by increasing confidence that the eurozone has averted catastrophe. With Japan, Australia, Switzerland, the U.K. and Canada also bemoaning the strength of their currencies, something's got to give. [View news story]
    Every single fundamental has been deteriorating and some fundamentals even at an accelerated pace.

    You name it: house prices, non-performing loans, industrial production, unemployment, consumption, capital investment, deficits, tax receipts, retail sales volume, car sales etc.

    Absolutely every economic indicator is signalling severe contraction, yet since the ECB has become the sovereign debt paymaster and interest rates on treasuries are dropping, we've solved all our issues and expect after a low growth 2013, 2014 to be a great year.

    It's bizarre.
    Jan 16 07:51 AM | Likes Like |Link to Comment
  • China's Beige Book expects GDP to have picked up to almost 8% in Q4, but lending to companies is sliding. "Very shockingly, most of our bankers say less than 20% of their lending goes to new loans," says the Beige Book's Leland Miller. "Most of it is going to debt rollovers or increases - they are not funding expansion." Miller's also worried about inventory growth in manufacturing and mining. "This calls into question just how sustainable this expansion is." [View news story]
    That 8% GDP growth has totally convinced me.
    Jan 16 06:24 AM | Likes Like |Link to Comment
  • The Bundesbank is repatriating at least part of its gold from New York (where 45% of the country's reserves are held) and Paris (11%), according to Handelsblatt. Steve Liesman says the Buba has confirmed the story, and the amounts are to be announced tomorrow. [View news story]
    If it worries you so much, buy coins. You'll pay a small premium though. You can also buy from a national mint to be on the 100% safe side, such as the Royal Canadian Mint.
    Jan 16 06:04 AM | 1 Like Like |Link to Comment
  • "We are not out of the woods," says Fed chief Bernanke in "a conversation" at the University of Michigan's Ford School. Raising the debt ceiling does not create new spending, he says. It simply allows the government to pay bills already racked up. There's no speech - he's currently taking questions from a moderator and will later take questions from the audience and from the twitterverse. [View news story]
    I'm not quite sure if I'm being whooshed here, otherwise I suspect you are having difficulties distinguishing between the two very basic concepts of deficit and debt.

    Debt = sum of all accumulated deficits and surpluses over the years

    Deficit = budgetary shortfall for one year.

    Germany has had a 0.8% shortfall for 2011 and a small surplus for 2012.

    How is that compatible with your claim of "still having huge deficits"?
    Jan 15 06:12 PM | 1 Like Like |Link to Comment
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