Month: November 2013

If anyone needed confirmation that yesterday’s soaring Chicago PMI data (to the highest since March 2011) was a typical “Made In Chicago” fabrication, then look no further than today’s final MarkIt US Manufacturing PMI, which instead of soaring as its Chicago counterpart, tumbled from 52.8 to 51.8, the lowest print since October of 2011 as the report indicated “only modest improvement in business conditions”, “output growth weakest for over four years”, and “new orders increasing at the slowest pace since April.” Then again, in the New Normal world in which data reports separated by 24 hours are expected to indicate diametrically opposite things, this is quite normal, and if nothing else, absolutely bullish. Why? Who knows, but cratering Manufacturing Output is surely beneficial to the stock market, if not the actual economy.

Broken down by Components:

From the report:

Commenting on the final PMI data, Chris Williamson, Chief Economist at Markit said: “While better than the earlier flash reading, the final PMI data indicate that the U.S. manufacturing sector ground to a near standstill in October. “Encouragingly, it looks like companies are expecting the slowdown to be temporary, most likely linked to the government shutdown, as indicated by an upturn in the rate of job creation.

 

“However, even the faster growth of employment remains only modest, consistent with barely any increase in official data on manufacturing payrolls. In addition, companies allowed their input inventories to fall at the fastest rate since 2009, highlighting widespread uncertainty towards the near-term outlook.

 

“The mixed signals from the survey therefore add to the likelihood that policymakers will need to wait for some time, perhaps a few months, until the picture clears  as to the true underlying health of the U.S. economy and its ability to create jobs.”

We get it: Chicago is good cop, MarkIt is bad cop whose purpose is to justify the taper delay.

Finally, spot the absolute contradiction between the MarkIt data, and the Chicago PMI euphoria:

Manufacturers linked the slight increase in output primarily to a weaker rise in new orders. Total incoming new work rose modestly and at the slowest pace in six months in October. Panellists commented on greater client demand in both the domestic and international markets. Nevertheless, a marginal increase in new export orders merely reversed a decline in September. Reflective of the weak trend for new orders, the quantity of inputs bought by manufacturing companies fell for the first time in almost three years in October. This was accompanied by the sharpest depletion of stocks of purchases since September 2009. Concurrently, suppliers’ delivery times continued to lengthen, with the latest increase in lead times the greatest for a year-and-a-half.

That’s ok: lies, like everything else, are bullish. Which is why we can only hope that today’s Manufacturing ISM due out shortly, prints in the triple digits. A lie of that magnitude will surely send stocks to turbo all time highs.

Source: Markit

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/oNoCWk0K3s8/story01.htm Tyler Durden

If anyone needed confirmation that yesterday’s soaring Chicago PMI data (to the highest since March 2011) was a typical “Made In Chicago” fabrication, then look no further than today’s final MarkIt US Manufacturing PMI, which instead of soaring as its Chicago counterpart, tumbled from 52.8 to 51.8, the lowest print since October of 2011 as the report indicated “only modest improvement in business conditions”, “output growth weakest for over four years”, and “new orders increasing at the slowest pace since April.” Then again, in the New Normal world in which data reports separated by 24 hours are expected to indicate diametrically opposite things, this is quite normal, and if nothing else, absolutely bullish. Why? Who knows, but cratering Manufacturing Output is surely beneficial to the stock market, if not the actual economy.

Broken down by Components:

From the report:

Commenting on the final PMI data, Chris Williamson, Chief Economist at Markit said: “While better than the earlier flash reading, the final PMI data indicate that the U.S. manufacturing sector ground to a near standstill in October. “Encouragingly, it looks like companies are expecting the slowdown to be temporary, most likely linked to the government shutdown, as indicated by an upturn in the rate of job creation.

 

“However, even the faster growth of employment remains only modest, consistent with barely any increase in official data on manufacturing payrolls. In addition, companies allowed their input inventories to fall at the fastest rate since 2009, highlighting widespread uncertainty towards the near-term outlook.

 

“The mixed signals from the survey therefore add to the likelihood that policymakers will need to wait for some time, perhaps a few months, until the picture clears  as to the true underlying health of the U.S. economy and its ability to create jobs.”

We get it: Chicago is good cop, MarkIt is bad cop whose purpose is to justify the taper delay.

Finally, spot the absolute contradiction between the MarkIt data, and the Chicago PMI euphoria:

Manufacturers linked the slight increase in output primarily to a weaker rise in new orders. Total incoming new work rose modestly and at the slowest pace in six months in October. Panellists commented on greater client demand in both the domestic and international markets. Nevertheless, a marginal increase in new export orders merely reversed a decline in September. Reflective of the weak trend for new orders, the quantity of inputs bought by manufacturing companies fell for the first time in almost three years in October. This was accompanied by the sharpest depletion of stocks of purchases since September 2009. Concurrently, suppliers’ delivery times continued to lengthen, with the latest increase in lead times the greatest for a year-and-a-half.

That’s ok: lies, like everything else, are bullish. Which is why we can only hope that today’s Manufacturing ISM due out shortly, prints in the triple digits. A lie of that magnitude will surely send stocks to turbo all time highs.

Source: Markit

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/oNoCWk0K3s8/story01.htm Tyler Durden

Three weeks ago, during the US government shutdown fiasco, and when there was legitimate concern if the US would begin prioritizing debt payments upon running out of cash, China’s official and most widely read press agency, Xinhua, slammed the US in “U.S. fiscal failure warrants a de-Americanized world” in which it called for a new world order, and an end to the reserve currency. Now, it is time for the follow up, with China kicking “America the eavesdropper” precisely when it is down.

From Xinhua:

The trust fiasco of America the Eavesdropper

The latest outburst of outcries and outrage across the world has laid bare that almighty America has at least one other anomalous addiction besides borrowing —  bugging.

The U.S. debt drama features a polarized and paralyzed Washington at the helm of the world’s largest economy. As nerve-racking as it is, such irresponsible behavior is a recurrent headache economic policymakers worldwide can bear with.

Yet the sole superpower’s spying saga is spicy on a heart-attack scale. It is particularly hurtful to those supposed to trust America the most — its allies.

The recent cascade of eye-popping disclosures depicts a hyperactive Uncle Sam prying into others’ secrets and even eavesdropping on dozens of heads of state.

It has been revealed that the U.S. National Security Agency (NSA) monitored the phone conservations of at least 35 world leaders in 2006. And that is just a tip of the iceberg of the spook organization’s sprawling spying scheme.

Leaked documents show that the NSA has not only gained front-door access to countless Google and Yahoo user accounts through a court-approved process, but secretly broken into the main communications links connecting the two Internet giants’ respective data centers around the world to siphon information at will.

What is counterintuitive in the NSA forage is its nonsensical approach: relentless and indiscriminate like a vacuum cleaner. It just bugs everybody, even its closest allies in Europe.

In the most shocking revelation so far, Uncle Sam turned Madame Europa, German Chancellor Angela Merkel, into, as Deutsche Presse-Agentur puts it, “a dupe whose mobile phone conversations were for more than a decade a source of information for U.S. authorities.”

Merkel and her peers in the U.S. alliance have every reason to feel insulted and betrayed. At the very least, they deserve the kind of respect and trust that underpins the practice that air travelers do not have to fly naked.

The motivation behind America’s extensive eavesdropping is unclear. The explanations the White House has been forced to offer are far from explanatory, and the diorthosis President Barack Obama has promised seems all but skin-deep.

The half-heartedness stands in stark contrast with the pushfulness with which America accuses China of cyber-espionage, and the evasiveness marks a stunning retreat from the straightforwardness with which Washington reproves Beijing for alleged monetary manipulation.

The apparent application of a double standard only reinforces the image of a Janus-faced America. In the sunlight, it preaches; in the dark, it pries. On the offensive, it orates; on the defensive, it equivocates.

The wayward practice has now backfired, and the damage is increasing. Just as the borrowing addiction is shedding America’s economic credibility, the bugging obsession is draining its political and security trustworthiness — only with potentially more destructive consequences.

Trust is the first and foremost casualty. Common sense dictates that trust is a two-way street: One has to trust in order to be trusted. It is particularly true in friendships and alliances. America obviously failed to follow the simple rule.

If Washington did not knit the worldwide wiretapping web just because it could, then its pillage for information unveils an Uncle Sam too deeply entrenched in suspicion and isolation to treat anyone as a real friend.

Ironically enough, the bugging undermines the very thing it is supposed to protect — national security. As America pins its security on alliances, the tapping tale would sour its relationship with allies — and thus erode its security bedrock — more than any terrorist would be capable of.

The harm could go far beyond. For example, mutual trust is vital to China and America’s endeavor to build a new type of major-country relations. Washington’s lack of trust and hemorrhage of trustworthiness would only make the effort more difficult.

Needless to say, trust entails trade-offs, and the quid pro quos are not riskless. But the United States should be wise enough to know that to trust nobody is no less dangerous than to trust anybody.

As indicated in the still simmering spying scandal, the potential cost of excessive bugging could be way higher. Uncle Sam needs to remember what happened to the tailor in the Lady Godiva story — Peeping Tom was struck blind.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/0-RaP5yWdRc/story01.htm Tyler Durden

Three weeks ago, during the US government shutdown fiasco, and when there was legitimate concern if the US would begin prioritizing debt payments upon running out of cash, China’s official and most widely read press agency, Xinhua, slammed the US in “U.S. fiscal failure warrants a de-Americanized world” in which it called for a new world order, and an end to the reserve currency. Now, it is time for the follow up, with China kicking “America the eavesdropper” precisely when it is down.

From Xinhua:

The trust fiasco of America the Eavesdropper

The latest outburst of outcries and outrage across the world has laid bare that almighty America has at least one other anomalous addiction besides borrowing —  bugging.

The U.S. debt drama features a polarized and paralyzed Washington at the helm of the world’s largest economy. As nerve-racking as it is, such irresponsible behavior is a recurrent headache economic policymakers worldwide can bear with.

Yet the sole superpower’s spying saga is spicy on a heart-attack scale. It is particularly hurtful to those supposed to trust America the most — its allies.

The recent cascade of eye-popping disclosures depicts a hyperactive Uncle Sam prying into others’ secrets and even eavesdropping on dozens of heads of state.

It has been revealed that the U.S. National Security Agency (NSA) monitored the phone conservations of at least 35 world leaders in 2006. And that is just a tip of the iceberg of the spook organization’s sprawling spying scheme.

Leaked documents show that the NSA has not only gained front-door access to countless Google and Yahoo user accounts through a court-approved process, but secretly broken into the main communications links connecting the two Internet giants’ respective data centers around the world to siphon information at will.

What is counterintuitive in the NSA forage is its nonsensical approach: relentless and indiscriminate like a vacuum cleaner. It just bugs everybody, even its closest allies in Europe.

In the most shocking revelation so far, Uncle Sam turned Madame Europa, German Chancellor Angela Merkel, into, as Deutsche Presse-Agentur puts it, “a dupe whose mobile phone conversations were for more than a decade a source of information for U.S. authorities.”

Merkel and her peers in the U.S. alliance have every reason to feel insulted and betrayed. At the very least, they deserve the kind of respect and trust that underpins the practice that air travelers do not have to fly naked.

The motivation behind America’s extensive eavesdropping is unclear. The explanations the White House has been forced to offer are far from explanatory, and the diorthosis President Barack Obama has promised seems all but skin-deep.

The half-heartedness stands in stark contrast with the pushfulness with which America accuses China of cyber-espionage, and the evasiveness marks a stunning retreat from the straightforwardness with which Washington reproves Beijing for alleged monetary manipulation.

The apparent application of a double standard only reinforces the image of a Janus-faced America. In the sunlight, it preaches; in the dark, it pries. On the offensive, it orates; on the defensive, it equivocates.

The wayward practice has now backfired, and the damage is increasing. Just as the borrowing addiction is shedding America’s economic credibility, the bugging obsession is draining its political and security trustworthiness — only with potentially more destructive consequences.

Trust is the first and foremost casualty. Common sense dictates that trust is a two-way street: One has to trust in order to be trusted. It is particularly true in friendships and alliances. America obviously failed to follow the simple rule.

If Washington did not knit the worldwide wiretapping web just because it could, then its pillage for information unveils an Uncle Sam too deeply entrenched in suspicion and isolation to treat anyone as a real friend.

Ironically enough, the bugging undermines the very thing it is supposed to protect — national security. As America pins its security on alliances, the tapping tale would sour its relationship with allies — and thus erode its security bedrock — more than any terrorist would be capable of.

The harm could go far beyond. For example, mutual trust is vital to China and America’s endeavor to build a new type of major-country relations. Washington’s lack of trust and hemorrhage of trustworthiness would only make the effort more difficult.

Needless to say, trust entails trade-offs, and the quid pro quos are not riskless. But the United States should be wise enough to know that to trust nobody is no less dangerous than to trust anybody.

As indicated in the still simmering spying scandal, the potential cost of excessive bugging could be way higher. Uncle Sam needs to remember what happened to the tailor in the Lady Godiva story — Peeping Tom was struck blind.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/0-RaP5yWdRc/story01.htm Tyler Durden

Back in January,  we highlighted the main problem plaguing the Greek financial system, and why a bailout (at least third, but likely fourth and fifth, and so on) is inevitable because “the amount of non-performing loans has exploded by a laughable amount, rising some 50% from December 2011, when it was “only” 16% and stood at a gargantuan 24% last month (indicatively, in the US this would mean that some $1.7 trillion in loans was nonperforming). And therein lies the rub, because as Kathimerini prudently notes, the “bad loans come to a considerable 55 billion euros. This means that the sum of NPLs already exceeds the total funds set aside for the recapitalization of the local credit system, which amounts to €50 billion.” Yesterday, Kathimerini provided a much needed update on the amount of NPLs in Greece: according to the latest PwC report, NPLs have risen by another €10 billion in under one year, and now amount to €65 billion, which is now larger than the recapitalization funding and amounts to more than double the €30 billion capital base of local banks!

From Kathimerini:

Nonperforming loans (NPLs) have grown this year to more than twice the size of local banks’ capital, as, according to a report by PricewaterhouseCoopers (PwC), they now amount to 65 billion euros, while the capital base of domestic lenders stands at 30 billion euros.

 

PwC added that the share of bad loans has exceeded 30 percent of all loans issued, up from 25 percent at end-2012 and 18 percent at end-2011.

 

However, Greek banks are very reluctant to sell their bad assets due to the very low prices that investors are offering. Bank officials have told Kathimerini that the offers they have been quoted would make the sale of bad loan portfolios practically pointless.

And since the amount of NPLs is double the equity buffer designed to soak up precisely the kinds of losses that appear once NPLs are priced to reality, it means that nearly 4 years after its first bailout, the Greek banking system is still as broke as ever. In fact, it is now doubly broke and rising at about €15 billion per year.

What this means is simple: just like in Cyprus, the day of inevitable “template” reckoning, in which deposits are “converted” into capital is fast approaching.

Greek depositors: you have been warned. As for the local stock market, well… New Normal and such.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/4_XgCZIXcy4/story01.htm Tyler Durden

It is now clear why according to the Obama administration there were no glitches plaguing the Healthcare.gov website administering Obamacare: because a whopping six people managed to sign up on the first day it was launched. By the end of the second day: 248 happy participants in a socialized healthcare ponzi scheme. It is also clear why there was nobody happier than the president when the republican party decided to shut down government on the same day as Obamacare was rolled out: because if public attention had focused on the absolute and now confirmed, disaster that the healthcare law’s rollout had been, then everyone, not just the Tea Party, would be demanding a substantial delay in Obamacare.

The enrollment data comes even after the Obama administration has said it cannot provide enrollment figures from HealthCare.gov because it doesn’t have the numbers. “We do not have any reliable data around enrollment, which is why we haven’t given it to date,” Health and Human Services Secretary Kathleen Sebelius told lawmakers on Wednesday. Turns out she did – as Reuters and ABC report, the documents, which are labeled “war room” notes and appear to be summaries of issues with the problematic website beginning on October 2, indicate a mere six enrollments had occurred by that morning – the day after the website was launched and almost immediately crashed.

So how is Obamacare like Facebook, or any other dot com special du jour – only the pageviews matter. Actual user conversions… well, that’s another matter entirely.

To date, Obama administration officials have refused to publicly provide any estimate of successful enrollments, though they have said the site received 4.7 million unique visitors on its first day and has now generated more than 700,000 applications.

 

An internal administration memo obtained by The Associated Press and confirmed by ABC News revealed that the administration projected half a million successful sign-ups by Oct. 31.

Good luck with that. And we mean it: after all like any authentic Ponzi scheme, Obamacare works only if wave after wave of signs up “foot” the costs for everyone who doesn’t. As such, unless massive amounts of people enroll, the program is assued to be a failure. Pardon: even more of a failure than it is now.

Naturally, the government was quick to downplay the figures:

HHS spokeswoman Joanne Peters stressed tonight that the enrollment figures presented in the “war room notes” are unofficial figures. The agency has said it intends to release its first official report on enrollments by mid-November.

 

“We will release enrollment statistics on a monthly basis after coordinating information from different sources such as paper, on-line, and call centers, verifying with insurers, and collecting data from states,” she said.

It gets better. Because after finally admitting there is nobody quite capable of messing something, anything, quite like the government, the administration finally agreed to get private sector help. In this case Oracel and… Google – the same firm that it was revealed earlier this week was furious at the government’s spying agency for illegally tapping its confidential user data streams.

The Obama administration said it has brought in experts from top technology companies including Google Inc and Oracle Corp to fix the HealthCare.gov website, as Republicans press for details about the botched October 1 launch.

 

Health and Human Services said it had added dozens of technology experts and engineers to its round-the-clock effort to fix the technical glitches on the site that is key to the implementation of Obama’s healthcare restructuring law.

 

Giving some of the first details of who might be leading the tech fix, HHS officials identified two experts by name: Michael Dickerson, a website reliability engineer on leave from Google, and Greg Gershman, a Baltimore-based innovation director with the firm Mobomo and who previously worked for the White House and the General Services Administration.

 

“We are doing everything we can to assist those contractors to make HealthCare.gov a highly performant, highly reliable, highly secure system,” Oracle CEO Larry Ellison told shareholders at the company’s annual meeting on Thursday in Redwood City, California. There was no comment from Google.

No need for a comment: the NSA already knew what they would say.

Finally, get your popcron because Darrell Issa is preparing to make a super spectacle out of the Obamacare flub, after yesterday he subpoenaed Sebelius, who previously took full responsibility for the “debacle”, for more information.

Issa said he had subpoenaed Sebelius for more information on the website’s technical problems, including how it was tested, and enrollment data. The subpoena requires the documents to be produced by November 13.

 

“The evidence is mounting that the website did not go through proper testing, including critical security testing, and that the administration ignored repeated warnings from contractors about ongoing problems,” Issa said in a statement.

Needless to say, this is all a short-term distraction: sooner or later the website will be fixed. It is only then that all those people who still have no idea what a complete disaster Obamacare is and will be for the US economy, will finally get the long overdue rude awakening.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/uphsIt2YasM/story01.htm Tyler Durden

It is now clear why according to the Obama administration there were no glitches plaguing the Healthcare.gov website administering Obamacare: because a whopping six people managed to sign up on the first day it was launched. By the end of the second day: 248 happy participants in a socialized healthcare ponzi scheme. It is also clear why there was nobody happier than the president when the republican party decided to shut down government on the same day as Obamacare was rolled out: because if public attention had focused on the absolute and now confirmed, disaster that the healthcare law’s rollout had been, then everyone, not just the Tea Party, would be demanding a substantial delay in Obamacare.

The enrollment data comes even after the Obama administration has said it cannot provide enrollment figures from HealthCare.gov because it doesn’t have the numbers. “We do not have any reliable data around enrollment, which is why we haven’t given it to date,” Health and Human Services Secretary Kathleen Sebelius told lawmakers on Wednesday. Turns out she did – as Reuters and ABC report, the documents, which are labeled “war room” notes and appear to be summaries of issues with the problematic website beginning on October 2, indicate a mere six enrollments had occurred by that morning – the day after the website was launched and almost immediately crashed.

So how is Obamacare like Facebook, or any other dot com special du jour – only the pageviews matter. Actual user conversions… well, that’s another matter entirely.

To date, Obama administration officials have refused to publicly provide any estimate of successful enrollments, though they have said the site received 4.7 million unique visitors on its first day and has now generated more than 700,000 applications.

 

An internal administration memo obtained by The Associated Press and confirmed by ABC News revealed that the administration projected half a million successful sign-ups by Oct. 31.

Good luck with that. And we mean it: after all like any authentic Ponzi scheme, Obamacare works only if wave after wave of signs up “foot” the costs for everyone who doesn’t. As such, unless massive amounts of people enroll, the program is assued to be a failure. Pardon: even more of a failure than it is now.

Naturally, the government was quick to downplay the figures:

HHS spokeswoman Joanne Peters stressed tonight that the enrollment figures presented in the “war room notes” are unofficial figures. The agency has said it intends to release its first official report on enrollments by mid-November.

 

“We will release enrollment statistics on a monthly basis after coordinating information from different sources such as paper, on-line, and call centers, verifying with insurers, and collecting data from states,” she said.

It gets better. Because after finally admitting there is nobody quite capable of messing something, anything, quite like the government, the administration finally agreed to get private sector help. In this case Oracel and… Google – the same firm that it was revealed earlier this week was furious at the government’s spying agency for illegally tapping its confidential user data streams.

The Obama administration said it has brought in experts from top technology companies including Google Inc and Oracle Corp to fix the HealthCare.gov website, as Republicans press for details about the botched October 1 launch.

 

Health and Human Services said it had added dozens of technology experts and engineers to its round-the-clock effort to fix the technical glitches on the site that is key to the implementation of Obama’s healthcare restructuring law.

 

Giving some of the first details of who might be leading the tech fix, HHS officials identified two experts by name: Michael Dickerson, a website reliability engineer on leave from Google, and Greg Gershman, a Baltimore-based innovation director with the firm Mobomo and who previously worked for the White House and the General Services Administration.

 

“We are doing everything we can to assist those contractors to make HealthCare.gov a highly performant, highly reliable, highly secure system,” Oracle CEO Larry Ellison told shareholders at the company’s annual meeting on Thursday in Redwood City, California. There was no comment from Google.

No need for a comment: the NSA already knew what they would say.

Finally, get your popcron because Darrell Issa is preparing to make a super spectacle out of the Obamacare flub, after yesterday he subpoenaed Sebelius, who previously took full responsibility for the “debacle”, for more information.

Issa said he had subpoenaed Sebelius for more information on the website’s technical problems, including how it was tested, and enrollment data. The subpoena requires the documents to be produced by November 13.

 

“The evidence is mounting that the website did not go through proper testing, including critical security testing, and that the administration ignored repeated warnings from contractors about ongoing problems,” Issa said in a statement.

Needless to say, this is all a short-term distraction: sooner or later the website will be fixed. It is only then that all those people who still have no idea what a complete disaster Obamacare is and will be for the US economy, will finally get the long overdue rude awakening.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/uphsIt2YasM/story01.htm Tyler Durden