Friday, January 15, 2016

Today's Links

1--Oil Bust could end dollar domination, oil price

The US dollar survived the collapse of Bretton Woods in the ‘70s because its use in crude oil transactions made it the king of reserve currencies, but can it survive a collapse of petro dollars? Can the world survive the catastrophic geopolitical consquences that would follow?

2--Atlanta Fed Waits Until The Close To Reveal 0.6% Q4 GDP Estimate

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2015 is 0.6 percent on January 15, down from 0.8 percent on January 8. The forecast for fourth quarter real consumer spending growth fell from 2.0 percent to 1.7 percent after this morning's retail sales report from the U.S. Census Bureau and the industrial production release from the Federal Reserve.

3--Empire Fed Crashes At Fastest Pace "Since Lehman"4--US Consumers Tap Out:
4--Retail Sales End Weakest Year Since 2009 As Control Group Tumbles
As Bloomberg summarizes, sales at U.S. retailers declined in December to wrap the weakest year since 2009, raising concern about the momentum in consumer spending heading into 2016.

5---Recession fears behind market rout
In the worst sell-off of the correction so far, the Dow fell more than 390 points Friday to 15,988, below 16,000 for the first time since October. The S&P 500, off nearly 2.3 percent, is now down 8.1 percent since the start of the new year. The S&P closed at 1876, but fell below last year's low of 1,867.

6--The Global Slowdown Hits the U.S.
America dodged the Asian financial crisis of 1997-98, but much has changed. Today’s world economic slide is starting to hurt

Plunging stock prices and slowing economic growth in China have raised anew the question of how much events abroad really matter to the U.S. Many of the answers are quite placid, drawing on the precedents of the 1997-98 Asian financial crisis, when there was similar concern about impacts at home, which never came. The U.S. grew at a 4.5% annual pace during those two years. For much of 2015, when U.S. growth remained steady despite volatile and weak growth in the rest of the world, the optimists said it was like 1997-98 all over again.
That may be, but the world has changed a lot in two decades

7--Santelli: Stocks plunge while bonds hardy budge
8--Junk-Bond Selling Hurt Some Fund Firms

9--U.S. Budget Deficit Ends Year at Lowest Level Since 2007

10--Wal mart takes a whoopin'--Brick-and-mortar retailers are being taken out the back and shot.

With impeccable timing – the very morning that the Commerce Department would report crummy retail sales – Wal-Mart Stores rubbed salt on the wound. It disclosed in an SEC filing that it was “committed to growing,” as CEO Doug McMillon put it, but was “being disciplined about it.”
Corporate speak for shutting 154 stores in the US – its 102 Walmart Express stores, 23 Neighborhood Markets, 12 Supercenters, 7 stores in Puerto Rico, 6 discount centers, 4 Sam’s Club stores – and 115 stores internationally, for a total of 269 stores.

11---Oil sinks under $30 again

At pixel time:

12--China's capital flight
13--Mosler:  Looks like the Fed hiked during a recession....
Sales remain at recession levels:

14-- Does China Hold Key To The Afghan Puzzle?

Kabul has committed to a huge 7,000-member security force to guard the $10-billion, 1,800 km long Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline within Afghanistan, assuming it will really be finished by December 2018. Optimistically, heavy work on clearing TAPI’s passage – and that includes demining – will begin in April....

everything comes back to Helmand. Why Helmand? My Pashtun interlocutors loosen up and say it with a mouthful: it’s all about the involvement of the CIA in the heroin trade in Afghanistan; “The Americans simply can’t let it go.”

15--Carter determined to defeat ISIS

The Pentagon chief flatly rejected any withdrawal from Syria and Iraq or a hands-off policy by Washington. Such a policy “would surrender the strong and global leadership that the United States stands for.”

Instead, he explained, “We are going to enable local, motivated forces and an international coalition with a clear campaign plan, with American leadership and with all of our awesome capabilities from airstrikes, special forces, cyber tools, intelligence, equipment, mobility and logistics, training, advise and assistance from those on the ground, including you.”
As this language indicates, US imperialism will be in control of the battle, while making use of local forces to do the bulk of the fighting and dying..

Significantly, he suggested that the war was about to be waged at an “increased tempo.” ISIS can be defeated “fairly quickly,” he said in an interview with Wolf Blitzer of CNN. “Hopefully,” he added, “the military party is short-term. The mid-term is going to be the intelligence and security aspect. The long-term is the ideological one and the educational one.”

16--Market crash robs $2.3 trillion from investors

17--A whole lotta Repricing going on

Investors are showing signs that they are again seeking out safe-haven investments like government bonds. The yield on the 10-year Treasury note, which falls as its price rises, declined to 2.03 percent after earlier falling below 2 percent for the first time since October. Oil prices settled below $30 a barrel on concerns about China and a potential flood of new oil from Iran.
“Technically we are in a bear market,” said Laurence D. Fink, the chief executive of BlackRock, the world’s largest money management company. “There is just a broad reassessment of risk right now.”


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