Guest yobob1 Posted February 27, 2004 Report Share Posted February 27, 2004 Good Morning Viet Nam! This is just a place keeper post so we don't start multiple threads. Link to comment Share on other sites More sharing options...
BearHugs Posted February 27, 2004 Report Share Posted February 27, 2004 From Zen last night: Immelt's Big Cheer for Globalization Snippet: "Globalization has a bad name," Immelt said. "But the world is inextricably global. We win by exporting and we win by sourcing, and in some of these countries there are no competitors that can beat me. As the energy grid is rebuilt in China, it will be built by GE. We haven't lost a single jet engine order in China in three years. Every turbine is built in Schenectady, every jet engine in Cincinnati. You have to be rooting for someone to win. That someone should be us." AWESOME ADVANTAGES. Immelt acknowledged that the 2004 Presidential campaign is driving much of the controversy, with issues such as job growth at home and outsourcing overseas becoming hot-button topics on the stump for Democrats John Kerry and John Edwards, and hot potatoes for President George Bush (see BW, 3/1/04, "Outsource This: The Dems Smell Blood"). "The economy is rebounding, but job creation is not as robust as everyone would like," he allowed. Still, "this is a wedge issue," and suggested America should look within for some of its troubles. "It shocked everyone how rapidly technology went to China and India. China graduates 450,000 engineers a year, India 350,000. In the U.S. it's more like 60,000 to 70,000. We graduate more people with degrees in sports therapy." I guess I have to ask "How many software programmers did we layoff last year and ship their jobs to China/India? How many Sports Therapists did we layoff last year?" From what I can tell, Sports Therapy is one job that has replaced the blue collar jobs. Not everyone can be an Engineer. And if they were, we'd be graduating 400,000 per year. Where would they work? What would they get paid? Sports Therapy type salaries? Link to comment Share on other sites More sharing options...
zensmoke Posted February 27, 2004 Report Share Posted February 27, 2004 Speaking of outsourcing...if you haven't seen Grot's new work, you need to have a look.... Grot's new classic Link to comment Share on other sites More sharing options...
BearHugs Posted February 27, 2004 Report Share Posted February 27, 2004 Speaking of outsourcing...if you haven't seen Grot's new work, you need to have a look.... Grot's new classic That's very funny. I think there are enough talented and well informed 'writers' here to actually put together the 'Stool Enquirer'. I suspect it would quickly become the most read online magzine by wall street. Link to comment Share on other sites More sharing options...
Hiding Bear Posted February 27, 2004 Report Share Posted February 27, 2004 Exploding Myths Baseball fans in Chicago wanted to find a way to get rid of the "myth" that kept them from winning important games. They found an explosive but effective solution to the problem. Literally (see link and picture below). The Japanese released their interevention totals for the month of February today: Foreign Exchange Intervention Operations (January 29, 2004- February 25, 2004) Ministry of Finance ○ Total amount of foreign exchange intervention operations for the period from January 29, 2004 through February 25, 2004: ? 3,342.0 billion Prior month - Total amount of sales of foreign securities to the Bank of Japan with buy-back clause for the period from January 29, 2004 through February 25, 2004 : ? 4,985.6 billion Prior months totals were ? 7,154.5 billion and ? 5,014.0 billion respectively http://www.mof.go.jp/english/feio/monthly/040227.htm What does this mean? In 2004, the Japanese spent $100 billion to support the US$ (10.5 trillion yen), and financed this through repos of almost $100 billion (10 trillion yen). Repos are fiat money, helecopter money, paper money - whatever you want to call it, it's inflationary. The myth I'd like to blow up here is that interevention creates stability - no, intervention creates instability and inflation. Exploding Myths - Cubs Fans Hope Blasted Ball Puts End to 'Curse' Link to comment Share on other sites More sharing options...
Guest yobob1 Posted February 27, 2004 Report Share Posted February 27, 2004 Where are we and where are we going? I'd tell, you but then I'd have to prep you for a dirt nap. Right now I think we're in limbo. The tremendous pressure of global liquidity is trying to keep the turd from swirling while the plunger of reality it trying to force it down. Who wins? Reality always wins. Fantasy financial machinations only delay the inevitable and at the same time causes a build-up of the forces of reality. the result is, reality builds up tremendous pressure such that when fantsay land gives way, the resultant flush is swift and violent. The reflationsists', who may despise the CBs but fear and worship their power, view point is that this can go on for a long time, like maybe forever. I would partially agree. It has gone on for a long time. But it has gone on for so long now that they are starting to shoot blanks. They seem to be staking all of their "hope" on jawboning now. There's virtually nothing left in the cookie jar to toss out. Massive tax cuts with two instant rebates, massive deficit spending ( a near trillion dollar swing) and interest rates cut by 85% in little more than two and a half years. Reserve requirements at the banks of less than 1%. Retail interest rates for durable goods (autos, home furnishings, appliances, ATVs - you name it) have been pegged near zero for 2 years now. Any conceivable shell game in home mortgages is not only allowed but encouraged. Free down payments, closing costs, stated income, interest only payments, 125% equity loans. Can they get any easier? The result is they have gone through virtually all of the creditworthy and began tapping the great unwashed masses of people you personally wouldn't loan a dime to. And for damned good reasons. These fresh loans are defaulting at an astonishingly high rate very soon after origination. Only the sheer bulk of the loan portfolios helps to disguise these facts. They won't stay hidden much longer. Maybe 6 months. Daily we are bombarded with these offers. Mortgage lenders are flooding the airwaves in a shrill feverish pitch and occupy close to half of the newpaper's ad space when combined with the realtors. Zero percent loans combined with rebates on cars are standard fare now. Truckloads of furniture you don't have to pay for until some distant date. The bells have never been rung more furiously, and yet the expected drooling seems to be turning more and more into a tiny ball of dried spittle. Pavlov would not be impressed. The "pent-up" demand has been wasted. There will be no "recovery" despite what the CEOs are projecting. The CEOs and other officers apparently don't believe what they are saying if you judge by the huge numbers of them dumping their own stocks. Follow the money. We are in the midst of the final wave of jingle in the consumer's pockets. E-filing of taxes and refund loans have pulled the bulk of the refunds into their hands already. Car dealers will do your taxes for free and give you your refund, if you'll just buy a car. And that brings us to financial fantasy land where every bet is guaranteed to be a winner. The dollar will no doubt go to the 90 or 91 every one expects, simply because that is what their TA has told them and that's how everyone has bet. The 10 years are rangebound at 4%. (Note to Al: Time's up! You must get the yield down to 3.20 today!) I'm not sure why markets even exist anymore. Why not just let everyone do their TA, analyze the resultant bets and pay-off accordingly. Why bother with actual trading at all? There sure as hell is no need for analcysts unless they serve as TA cheer leaders. Heat mapping has spread to virtually all markets now. A tiny wiggle in a line causes a great flood of money to race over and jump on board until a wiggle somewhere else looks better. Of course there are always the losers in the trade. Those who jump on board just before the flood recedes are left stranded with most of their money vaporized. Sheeple playing in this market are fools. It will all fail someday. But when? How about March 23rd. Good as day as any. I would think that the smart money will want out before the lagging data starts hitting the wires in April. Link to comment Share on other sites More sharing options...
zensmoke Posted February 27, 2004 Report Share Posted February 27, 2004 More Boolish Outsourcing News: DJ US Biotechnology Firms Looking At Outsourcing To India HYDERABAD, India (AP)--After moving hundreds of thousands of software jobs overseas, U.S. companies are now looking at India to outsource research and clinical trials in biotechnology. Officials from about a dozen U.S.-based pharmaceutical companies are in India to attend a three-day conference on biotechnology and explore possible tie-ups with Indian companies, which can do research for them at a fraction of what it costs in the U.S. The conference began Thursday at Genome Valley, a sprawling 240-hectare complex that is being developed as a biotechnology research hub on the outskirts of the southern city of Hyderabad. "I am here not to just talk about ideas, but also I am looking for outsourcing opportunities for my company," said Vipin Garg, chief executive of North Carolina-based Tranzyme Pharma, Research and Triangle Park. The move will help in bringing down the cost of clinical trials of the new drugs in the U.S., which currently is estimated at $150 million a year, said Steve Lawton, vice president of the Biotechnology Industry Organization, a major grouping of biotechnology firms in the U.S. Lawton said he disagreed with the Democrats, who blame U.S. job losses on increasing transfer of technology work by U.S. companies to countries like India and the Philippines. "Outsourcing does not necessarily means loss of jobs at all. It could mean the creation of more different types of jobs in the U.S.," Lawton said. He didn't elaborate, but outsourcing proponents say the practice will eventually pay off for the country losing jobs by giving its companies the financial might to develop new products and technologies. At the same time, they say, higher employment in developing nations puts more money in the hands of foreign consumers, spurring demand for Western products. Lawton and others at the conference, however, expressed concern over intellectual property rights, saying India's ability to attract foreign investment in biotechnology research will depend on new patent rules scheduled to take effect from January 2005. Currently, India doesn't recognize product patents. Any company in India is free to copy any product if it employs a manufacturing technique different from that used by the product's inventor. "One of the issues we have to figure out is how do we protect our intellectual property rights while outsourcing," said Garg. "We hope very much that (the Indian) parliament over the next year or so will take up these issues, which are somewhat complex but terribly important to the biotechnology industry and essential to significant partnering arrangements between companies in the United States and the companies based here," he said. (More on Dow Jones Newswires) Link to comment Share on other sites More sharing options...
machinehead Posted February 27, 2004 Report Share Posted February 27, 2004 In 2004, the Japanese spent $100 billion to support the US$ (10.5 trillion yen), and financed this through repos of almost $100 billion (10 trillion yen). $100 billion ... in the two months year-to-date. $600 billion annualized. Adjust for the U.S. population being 2.5 times Japan's, and that's like Uncle Sam spending $1.5 trillion to stabilize the dollar. In a year. That would be two-thirds of the whole Federal budget, in the U.S. case. Even governments, with the sovereign power to tax and print money, have limits on what they can spend. Nobody knows exactly what they are, but they surely exist. Japan doesn't have the resources to keep spending at this rate. It is the most deeply indebted rich country, though the debt is financed at a miniscule 1% rate. When nominal interest rates finally blow higher, Japan will be finished overnight. It's a financial accident waiting to happen. Sayonara, so solly ... Link to comment Share on other sites More sharing options...
Hiding Bear Posted February 27, 2004 Report Share Posted February 27, 2004 In 2004, the Japanese spent $100 billion to support the US$ (10.5 trillion yen), and financed this through repos of almost $100 billion (10 trillion yen). $100 billion ... in the two months year-to-date. $600 billion annualized. Adjust for the U.S. population being 2.5 times Japan's, and that's like Uncle Sam spending $1.5 trillion to stabilize the dollar. In a year. That would be two-thirds of the whole Federal budget, in the U.S. case. Even governments, with the sovereign power to tax and print money, have limits on what they can spend. Nobody knows exactly what they are, but they surely exist. Japan doesn't have the resources to keep spending at this rate. It is the most deeply indebted rich country, though the debt is financed at a miniscule 1% rate. When nominal interest rates finally blow higher, Japan will be finished overnight. It's a financial accident waiting to happen. Sayonara, so solly ... Well said. I remember many years ago (maybe 40) in the Japanese Parliment there were sometimes violent discussions between political parties. Then one primary party essentially took over debate. Well they haven't seen anything yet. When the retired, grey haired set of Japan see one day the value of their lifetime of hardwork and savings disappear through inflation, they will be angrier than a samori wielding a sharp blade. Although there is a plan to reduce the amount of fiat issues of new yen to buy $ by issuing yen bills, it is only slowly being implemented. In China, they have a similar problem. Ben Bernanke should be pleased at how effective Asian CBs have created new money. This is the last frontier of credit creation, the one after the scenario described by Yo Bob above, the one that is saving our economy from falling apart. PS - Good posts yesterday and today by yobob, MH, wdnysrf (on MTM). Also thanks everyone for their contributions to B4 the Bell. Link to comment Share on other sites More sharing options...
zensmoke Posted February 27, 2004 Report Share Posted February 27, 2004 Surprise, surprise... WASHINGTON (Dow Jones)--The U.S. economy was a bit stronger in the final three months of 2003 than earlier projected as the government raised its estimates on spending by consumers and businesses. Gross domestic product increased in October through December at a 4.1% annual rate, half its blistering 8.2% pace in the third quarter, the Commerce Department said Friday. (Dow Jones Newswires) Link to comment Share on other sites More sharing options...
DrStool Posted February 27, 2004 Report Share Posted February 27, 2004 Your Golden Stool, including short and long term updated charts and price targets, is loaded each morning. Even if you are not a goldbug, you should check out the Golden Stool, a daily Anals release. Take a subscribatory and get the latest release of the Golden Stool from your Anals RIGHT NOW! Don't miss another Golden Stool! 15 Day Intro Subscribatory. Just $2.99! Get In RIGHT NOW! Link to comment Share on other sites More sharing options...
zensmoke Posted February 27, 2004 Report Share Posted February 27, 2004 China Regulator Warns Of Investment Bubble By Peter S. Goodman Washington Post Foreign Service BEIJING, Feb. 26 -- China's senior currency regulator warned Thursday that the billions of investment dollars surging into the country may be generating a potentially dangerous bubble, adding to recent speculation that the government may slightly increase the value of the country's currency in order to cool growth. "The inflation rate is rising, and the asset bubble problem is starting to get worrying," Guo Shuqing said in a statement published on the Web site of the State Administration of Foreign Exchange, which supervises inflows of foreign money. http://www.washingtonpost.com/wp-dyn/artic...-2004Feb26.html SOHU, NTES, SINA anyone? Link to comment Share on other sites More sharing options...
zensmoke Posted February 27, 2004 Report Share Posted February 27, 2004 *DJ Pan Amer Silver: Institutional Buyer Getting 3.3M Shrs At $16.50/Shr (Dow Jones Newswires) Link to comment Share on other sites More sharing options...
machinehead Posted February 27, 2004 Report Share Posted February 27, 2004 Ben Bernanke should be pleased at how effective Asian CBs have created new money. This is the last frontier of credit creation, the one after the scenario described by Yo Bob above, the one that is saving our economy from falling apart. It also could be viewed as high-tech mercantilism. During the 19th century, colonial powers stripped colonies of their raw materials, while shoving their manufactured goods down the colonies' throats. In 21st century mercantilism, the colonial power strips the colonies of their manufactured goods, while shoving its paper securities (currencies and bonds and such) down their throats. But colonies eventually revolt ... Link to comment Share on other sites More sharing options...
Hypertiger Posted February 27, 2004 Report Share Posted February 27, 2004 In 2004, the Japanese spent $100 billion to support the US$ (10.5 trillion yen), and financed this through repos of almost $100 billion (10 trillion yen). $100 billion ... in the two months year-to-date. $600 billion annualized. Adjust for the U.S. population being 2.5 times Japan's, and that's like Uncle Sam spending $1.5 trillion to stabilize the dollar. In a year. That would be two-thirds of the whole Federal budget, in the U.S. case. Even governments, with the sovereign power to tax and print money, have limits on what they can spend. Nobody knows exactly what they are, but they surely exist. Japan doesn't have the resources to keep spending at this rate. It is the most deeply indebted rich country, though the debt is financed at a miniscule 1% rate. When nominal interest rates finally blow higher, Japan will be finished overnight. It's a financial accident waiting to happen. Sayonara, so solly ... The official discount rate in Japan is 0.1%. It was at 1% in 1995...then dropped to 0.5% in late 1995 and held there until 2001 when the FED started chopping due to the collapse of debt inflationary potential in 1999... Link to comment Share on other sites More sharing options...
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