Americans' Lousy #Jobs Grow - NO Raises?

Lousy Jobs Grow -So What? 

Even with strong jobs growth, wages slipped in February. After a 12-cent gain in February, average hourly earnings declined by 3 cents, and they’ve grown by just 2.2 percent over the last year.

In all, figures can be misleading and fail to tell  the real story leading to the decline o f the middle class

Blockbuster Job Growth Still Isn’t Turning Into Big Raises For American Workers

The economy added 242,000 jobs in January while the unemployment rate stayed unchanged at 4.9 percent, according to the latest data from the Bureau of Labor Statistics. Analysts had expected 190,000 jobs to be added.

That maintains the lowest unemployment rate in 2008. The number of jobs added in December of last year was revised up by 9,000, while January was revised up by 21,000. With revisions included, the economy has been adding jobs at a 228,000 average monthly pace, matching the pace of growth in 2015. The labor force participation rate and employment-population ratio both edged up in February, signs that more people are joining the labor force and seeking jobs.

Job gains were concentrated in health care and social assistance (57,000), retail (55,000), food service and drinking places (40,000), private education services (28,000), and construction (19,000). Retail has added 339,000 jobs over the last year, while food and drinking places have added 359,000.

Even with strong jobs growth, wages slipped in February. After a 12-cent gain in February, average hourly earnings declined by 3 cents, and they’ve grown by just 2.2 percent over the last year.

http://thinkprogress.org/economy/2016/03/04/3756584/jobs-february-2016/

The Revolt Begins: German Banking Association Tells Members To Start Hoarding Bills  

Cheap money encourages risky behavior. It gives banks an incentive to give ‘no money down’ loans to homeless people with no employment history.

It creates bubbles (like the housing bubble from 10 years ago), and ultimately, financial panics (like the banking crisis from 8 years ago). Banks are supposed to be conservative, responsible managers of other people’s money.

Here Come The SDR Bonds  

This one statement provides the largest validation yet for POM readers that we are in fact on the correct course with this thesis. What isn’t clear in the statement is whether July is the deadline for the report to be presented, or when the broader use of the SDR should begin. Considering the time it takes to decide on changes and implement them, it would be my interpretation that it is only the report which is meant to be completed by July.

"Democracy Ends In Turkey": Prominent Anti-Erdogan Newspaper Seized In Midnight Raid  

The details: shortly before midnight, a team of police arrived with two Turkish-made TOMA water cannon trucks. They advanced military style towards the waiting supporters, firing the freezing water directly at them. Using bolt-cutters to unlock the iron gate in front of the building, dozens of police then marched into the premises to seize the headquarters and formally place it under administration, pushing aside anyone who stood in their way, Cihan images showed.

Debtor  Days Are  Over as BIS  Calls  Time on World  Credit  Binge 

T

he world’s credit boom is beginning to show dangerous signs of unraveling, ushering in a period of fresh turmoil for the over-indebted global economy, the Bank of International Settlements has warned. 

The globe’s top financial watchdog called time on the world’s debt binge, noting that debt issuance and cross border flows in emerging economies slowed for the first time since the aftermath of the global credit crunch at the end of last year.

• Debts, defaults and devaluation - why this market crash could be like nothing we've seen

With financial markets thrown into fresh paroxysms in 2016, oscillating between extremes of “hope and fear”, the over-leveraged world was finally approaching a day of reckoning, said Claudio Borio, the bank's chief economist.

•  http://www.telegraph.co.uk/business/2016/03/04/debtor-days-are-over-as-bis-calls-time-on-world-credit-binge/

www.firstfinancialinsights.blogspot.com

Korean Nuclear War Signals Rattles West

2016 Cuban Missile Crisis? 

 This situation has not garnered the attention it deserves in the press nor by the markets. Should tensions escalate to the point of causing a nuclear event then such an engagement could lead to wider actions  bringing  the involvement of respective allies and the bigger powers. 

Even the limited use of nuclear weapons places the world in greater peril than most appreciate or know at first glance. Why? Russia operates a mechanized nuclear defence program that is often termed and referred to as  " the dead-hand system" because the missile-launch- order can  be triggered when its sensors determine that the radioactivity in the atmosphere is beyond preset acceptable levels. Breaching of these tests causes the system to conclude and assume that a nuclear attack is being carried out against their nation and it will then automatically order the launch of Russian missiles aimed at predetermined targets. 

There is no human involvement. 

 Originally the system was designed to provide for an immediate  retaliatory strike in the event that  the leadership in the Kremlin was destroyed 

by a first strike by an aggressor. 

and thus decapitating the decision-making powers ability to respond.  The premise of the system embraces the cold war  assumption  that the threat of mutual annihilation would deter  the superpowers, at the time, from ever entering into any confrontations using nuclear weapons.

However, today  this old and perhaps antiquated system could inadvertently  launch  missiles because the sensors detect the radiation from a much smaller nuclear conflict. Right now, as long as tensions remain high in North Korea there is a great danger that aggressions could expand rapidly into the global theatre. Such a possibility, to our knowledge has not been experienced since the Cuban Missile Crisis, in 1962, when the world was was gripped by fear and  just seconds away from a global nuclear war that could have wiped out all of humanity in mere days.

 In light of the concerns mentioned, and their potential consequences and devastation  - this situation is to be given the highest priority and attention in the days and weeks ahead. It is also noted that certain  US Presidential candidates indicated, in February, that they would approve a preemptive strike against North Korea - that does not sound like such a  good idea should it also lead to those same sensors detecting and acting upon excessive radioactivity in the atmosphere. Moreover, leadership in North Korea is far from stable or sensible - you have a child holding a loaded gun.      

In the last analysis, the world again is walking on eggshells; one misstep having frightening ramifications 

Will South Korea Have to Bomb the North, Eventually?

As North Korea expands its nuclear arsenal, will Seoul have to consider targeting missile sites at some point?

As North Korea continues to develop both nuclear weapons and the missile technology to carry them,pressure on South Korea to take preemptive military action will gradually rise. At some point, North Korea may have so many missiles and warheads that South Korea considers that capability to be an existential threat to its security. This is the greatest long-term risk to security and stability in Korea, arguably more destabilizing than a North Korean collapse. If North Korea does not arrest its nuclear and missile programs at a reasonably small, defensively-minded deterrent, then Southern elites will increasingly see those weapons as threats to Southern survival, not just tools of defense or gangsterish blackmail.

READ MORE

http://thediplomat.com/2015/03/will-south-korea-have-to-bomb-the-north-eventually/

North Korean Leader Wants Nukes Ready to Fly

North Korean leader Kim Jong Un has ordered nuclear weapons to be readied for use, the state-controlled Korean Central News Agency reported Thursday.

 READ MORE

http://www.usatoday.com/story/news/2016/03/03/north-korea-readies-nuclear-weapons/81284690/

We Are Headed Towards A Cashless Society Unless The Public Protests It  

In reality, what this new policy, which is the same as the old policy, does is induce businesses to invest more on durable goods like cars and houses, which is why there are new bubbles in these markets, at least in some regions. The price-per-square-foot of Las Vegas real estate, for example, is now higher than it was just before the crash of 2008. There’s also a student debt bubble and a stock market bubble, in my opinion, thanks to the Fed’s single-minded and very simple policy of print, print, and print some more. Rather than reducing some of the wild and reckless speculation on Wall Street, the government bailouts of the speculators created a “moral hazard problem” that will encourage even more reckless speculation. If the speculative investments pay off, they keep the profits; when they go bust, they can count on another round of “too-big-to-fail” bailouts.

Countries producing 73% of world oil agree to freeze production  

Countries producing 73 percent of the world's oil have agreed to freeze oil production, Russia's energy minister said Tuesday.

Regulating Automakers to Death  

For an automaker, the idea is to build just enough EV models to meet the California mandates. Sure, your electric vehicles will lose money, but you’re getting credit for the EVs’ 100-mpg fuel ratings. In the bargain, you can still sell lots of gas-guzzling Escalades, Navigators and F-150s (all highly profitable vehicles to make and sell) — and still come out with a fleet-wide average of 54.5 mpg when 2025 rolls around.

Alberta Budget Deficit Could Top $10 billion

Alberta’s deficit for next year could top $10 billion after projected quick recoveries in the price of oil were proven wrong, according to Finance Minister Joe Ceci.

“Falling oil prices continue to negatively impact our fiscal situation in Alberta,” he said. “And of course, it’s going to affect our bottom line.”

In its first budget as government, released Oct. 27, 2015, the province posted a $6.1 billion deficit in 2015/16 in order to stabilize frontline public services such as health care and education. Ceci said that deficit had grown by approximately $200 million.

Next year’s deficit was previously anticipated to hit $5.4 billion. According to Ceci, the prolonged slide in oil prices will see that number increase significantly when the spring budget is tabled in April, and is now forecasted at approximately $10.4 billion.

READ MORE

http://www.airdriecityview.com/article/Alberta-budget-deficit-could-top-10-billion-20160303

www.firstfinancialinsights.blogspot.com 

#Economy Lurched at Brink - South Africa

 This is another case where an overpopulated country with diminishing resources  per capita has fallen  onto perpetual hard times like Nauru.  It reflects the peak in global civilization and there are more coming as the resources per capita crisis grows unabated.

Tipping Point Looms for Despairing South Africa  

Not since Nelson Mandela walked out of Victor Verster prison 26 years ago have investors been gloomier about South Africa’s economy.

Money is pouring out at a record pace as inflows dwindle. The rand has plunged and unemployment is the highest among almost 40 developing nations tracked by Bloomberg. Drought is driving up food costs. Hanging in the balance is the investment-grade credit rating South Africa sweated to achieve in 2000, shortly after Mandela left office.

South Africans are paying the price not just for a collapse in commodities prices -- metals and mining contribute more than 50 percent of exports -- but for growing questions over whether President Jacob Zuma is up to the task. Stoking doubts were the antics at the finance ministry in December, when Zuma removed Nhlanhla Nene and replaced him with little-known lawmaker David van Rooyen. As bond yields soared and the rand crashed, he changed his mind four days later and installed Pravin Gordhan, Nene’s predecessor.

Read More

http://www.bloomberg.com/news/articles/2016-02-21/tipping-point-looms-for-south-africa-as-economy-s-despair-grows

Even Bank Bailout Architect Says Time To Break Up Banks  

The $700 bank bailout plan Kashkari helped author, known as the Troubled Asset Relief Program (TARP), stopped the Wall Street firms that caused the crisis from going bankrupt. A parallel process, undertaken by New York President Timothy Geithner along with the Treasury Department, pressured the Wall Street banks to merge and get even bigger in hopes that size would increase confidence in the financial system

What's in your food? Nobody really knows  

Why doesn’t government know what’s in your food? Because industry can declare on their own that added ingredients are safe. It’s all thanks to a loophole in a 57-year old law that allows food manufacturers to circumvent the approval process by regulators. This means companies can add substances to food without ever consulting the Food and Drug Administration about potential health risks.

Copper: The Next Metal Set To Rise After Gold?  

The grey moving average on the larger chart is the 60 day moving average, which is more important than the widely followed 50 DMA, and it shows signs of flattening, a very bullish signal, certainly if it will transition into a rising pattern.

 New Global Financial Cold War  

The United States has responded by changing the IMF rules. It said, ‘Wait a minute. It’s okay for the IMF to make loans to countries that don’t pay China and Russia or the BRICs, because we’re in a new Cold War. The IMF really is working for us.’ As long as the U.S. has veto power in the IMF, its delegate can veto any loan to a country that owes money to the United States that the United States doesn’t wish to support. But it has no objection for the IMF making loans to U.S. satellites such as Ukraine, that official debts to Russia.

http://www.nakedcapitalism.com/2016/02/michael-hudson-discusses-the-new-global-financial-cold-war.html

It Makes No Sense To Raise Fed Rates, & More News

Why The Fed Would Be Insane To Raise Rates: The Rising U.S. Dollar

The USD strengthening since last July is the core driver of the global recession.

The parlor game of the moment is laying odds on the Federal Reserve's decision to raise rates, leave rates unchanged, or (gasp!) hint at future stimulus. There are certainly a multitude of inputs to the Fed's decision, and a variety of potential consequences, but only one really matters: the effect on foreign exchange/currency markets.

It's not that difficult to understand the one dynamic that matters. If the Fed raise yields/interest rates in the U.S., that makes the U.S. currency, i.e. the U.S. dollar (USD), more attractive.

Higher yield = more attractive, especially when coupled with the liquid market for U.S. Treasuries and the relative safety of the dollar vis a vis other currencies issued by falling-into-recession nations and trading blocs.

A rare interview with the mathematician who cracked Wall Street 

Jim Simons was a mathematician and cryptographer who realized: the complex math he used to break codes could help explain patterns in the world of finance. Billions later, he’s working to support the next generation of math teachers and scholars. TED’s Chris Anderson sits down with Simons to talk about his extraordinary life in numbers.

Honda to test self-driving cars, manufacturers pledge auto-braking for the masses 

The AP reports that some driver advocates like the Center for Auto Safety were concerned that this pledge doesn’t do enough to get automatic breaking systems into cars. Those advocates would rather the government legally require cars to have automatic breaking systems, instead of rely on a voluntary promise to keep drivers safe. Another concern is that automatic braking systems are generally sold as add-ons to luxury vehicles, which would put them out of reach of most consumers

Big banks in $1.865 billion swaps price-fixing settlement 

Credit default swaps are contracts that let investors buy protection to hedge against the risk that corporate or sovereign debt issuers will not meet their payment obligations.

The market peaked at $58 trillion in 2007, according to the Bank for International Settlements, but shrank to $16 trillion seven years later as investors better understood its risks

Sovereign Debt for Territory: A new Global Elite Swap Strategy 

One often wonders why governments indebt themselves for so much more than they can ever hope to pay… Here, Western economists, bankers, traders, Ivy League academics and professors, Nobel laureates and the mainstream media have a quick and monolithic reply: because all nations need “investment and investors” if they wish to build highways, power plants, schools, airports, hospitals, raise armies, service infrastructures and a long list of et ceteras, economic and national activities are all about.

The Real Cost of Filling Up: Gasoline prices by country 

This ranking sorts 61 countries by price, earnings needed to buy a gallon, and annual income spent on fuel.

As a Boom Fades, Brazilians Wonder How It All Went Wrong

BRASÍLIA — The president of Brazil should have been ecstatic. She had just won re-election after an intense campaign in which she fiercely defended her role in making Brazil, for a few fleeting years, a rising star on the global stage.

But in the days after her victory last October, President Dilma Rousseff was worried, confronted in private deliberations with her closest advisers by signs that Brazil’s triumphs were at risk of coming undone.

“We went too far,” Aloízio Mercadante, Ms. Rousseff’s chief of staff, acknowledged publicly this month, describing the sense of alarm as the dust settled after the election and Ms. Rousseff and her aides grappled with the weaknesses in Brazil’s economy.

A Passing Thought...