Did The Bottom Just Fall Out Of Commodities?

Global growth expectations… we have a problem. With all eyes focused on BABA, Treasury yields, and Russell 2000 death-crosses, the old equally-weighted CRB commodity index has broken down through support to 4-year lows this morning

 

 

Commodities have slipped notably since confirming their own death cross in August.

Chart: Bloomberg

h/t Brad Wishak at NewEdge




via Zero Hedge http://ift.tt/1sDZDWX Tyler Durden

Anarchy In Washington: Is Anybody In Charge?

Submitted by Justin Raimondo via Antiwar.com,

The President pledges "no combat troops" in Iraq.

The head of the Joint Chiefs of Staff, Gen. Martin Dempsey, says he may recommend combat ground troops in the battle against ISIS.

The President, in a speech, reiterates "no ground troops," and "no combat troops."

While Hillary Clinton, Obama’s presumptive heir, waits in the wings as her scheme to arm the Syrian rebels is implemented and the fuse is lit on the Levantine tinderbox. It isn’t a very long fuse….

So what is going on with the US government, and especially over at the Pentagon? Are they directly challenging the President – who is then acting to quickly quash them? Sure looks like it.

Amid reports of a titanic battle within the Obama administration, the conflicting messages being put out there by various wings of the national security establishment remind us of the Empire’s sheer size and the scale of the bureaucracy: it is large enough to constitute what are, in effect, competing governments – a condition statists of every variety always told us was unworkable.

In short, when it comes to the making of American foreign policy what we have in Washington is what appears to be the functional definition of anarchy! And the libertarians haven’t even taken over yet.

The mess that is the Obama plan for defeating ISIS perfectly illustrates the central dictum of what I call "libertarian realism" – a theory of international relations that attributes foreign policy decision-making to primarily domestic political pressures, i.e. to the chief motivation of politicians everywhere, which is to maintain and expand their own power and their own term in office. The result is that US policy – or, indeed, the foreign policy of any nation – has little to do with facts on the ground, or how to utilize them to serve legitimate national interests. Instead, it’s all about how to appease the various domestic pressure groups with a stake in the matter.

This is why war propaganda is such a vital component of modern warfare, arguably the most important weapon in any country’s arsenal. That’s because the real target is domestic public opinion, with the targeted cities of the enemy only a secondary consideration.

Left with the Iraqi mess he inherited from the Bush administration, President Obama had few viable options. Constrained by his own campaign promises and public opposition to any further fighting in Iraq, he is nevertheless confronted with the blowback – and his "plan" reflects the only possible means to deal with it within the theoretical framework of libertarian realism. The public opposes troops on the ground – and so the President sticks that in his "plan." The political elites want to aid the Syrian rebels, so he sticks that in there, too. A general who knows better tells the country the truth: it will take ground troops to accomplish the mission. Yet the mission being accomplished is beside the point – because the real mission is winning the hearts and minds of the American people. That’s the battlefield this President – and every President – must fight on.

The Sunni-Shia civil war we encouraged throughout the region for our own purposes has now given birth to the monstrous ISIS, the Frankenstein creature that crawled out of the chaos we created. Like those scary mutations depicted in post-nuclear war movies, all scales and fangs, ISIS gibbers and glories in its monstrousness, doing for the War Party what Bill Kristol and his fellow neocons could never have pulled off by their own efforts. All it took was a few Youtube videos and the social media savvy of the ISIS public relations department.

Funny how that worked out, eh?




via Zero Hedge http://ift.tt/1rlX9jJ Tyler Durden

The Economics of Prison Gangs

A very interesting Atlantic
article
about prison gangs devotes a lot of attention to the
work of David Skarbek, a graduate of George Mason’s economics
program who now teaches at King’s College London. Here are some
excerpts:

Your guide.“Prison
is set up so that most of the things a person wants to do are
against the rules,” Skarbek says. “So to understand what’s really
going on, you have to start by realizing that people are coming up
with complicated ways to get around them.” Prison officials have
long known that gangs are highly sophisticated organizations with
carefully plotted strategies, business-development plans,
bureaucracies, and even human-resources departments—all of which,
Skarbek argues, lead not to chaos in the prison system but to
order….

Prison, Skarbek claims, is the ultimate challenge for a
rational-choice theorist: a place where control of the economic
actors is nearly total, and where virtually any transaction
requires the consent of the authorities. The Soviets had far less
control over their people’s economic activity than prison wardens
do over the few dollars available for prisoners’ commissary
purchases. Both settings have given rise to alternate currencies
and hidden markets. Most famously, cigarettes have become the
medium of exchange in many prisons. But when they are banned, other
currencies take their place. California inmates now use postage
stamps….

Can't a man get some sleep?What’s astonishing to outsiders, Skarbek says, is
that many aspects of gang politics that appear to be sources of
unresolvable hatred immediately dissipate if they threaten the
stability of prison society. For example, consider the Aryan
Brotherhood—a notoriously brutal organization whose members are
often kept alone in cells because they tend to murder their cell
mates. You can take the Brotherhood at its word when it declares
itself a racist organization, and you can do the same with the
Black Guerrilla Family, which preaches race war and calls for the
violent overthrow of the government. But Skarbek says that at
lights-out in some prisons, the leader of each gang will call out
good night to his entire cellblock. The sole purpose of this
exercise is for each gang leader to guarantee that his men will
respect the night’s silence. If a white guy starts yelling and
keeps everyone awake, the Aryan Brothers will discipline him to
avoid having blacks or Hispanics attack one of their members. White
power is one thing, but the need to keep order and get shut-eye is
paramount.

There’s much more, including an argument that “prison gangs are
the courts and sheriffs for people whose business is too shady to
be able to count on justice from the usual sources.” Read the rest

here
. Buy Skarbek’s book The Social Order of the
Underworld
here. See
him describe the world’s freest prison here. Peruse Reason‘s
special incarceration issue here.

from Hit & Run http://ift.tt/1p47UlW
via IFTTT

"The GOP’s metamorphosis from…the stupid party into [one] that is both stupid and useless is almost complete."

Just
a few months ago, when Rep. Kevin McCarthy (R-Calif.) became the
House Majority Leader, he announced the the GOP would allow the
Export-Import Bank, which subsidizes purchases of goods made by
politically connected U.S. firms, to expire “because it’s something
the private sector can be able to do.”

That was then. The budget resolution approved by Congress
yesterday not only continues funding for the Export-Import Bank, it
signed off on the Iraq-Syria War of 2014 without actually putting
the matter to a constitutionally mandated vote:

The GOP, which claims to be the party that pledges maniacal
fealty to the Constitution, can’t be bothered to push for a
declaration of war, but it’s happy to shovel more borrowed money
toward a dodgy group of Syrians. “I frankly think the president’s
request is a sound one,” Speaker of the House John Boehner
told The Washington Times. The only real disagreement
among Republicans is whether to put American soldiers on the ground
to fight ISIS in Iraq and Syria, which appears to be what Sen. John
McCain is pushing for.

In a new column for

The Daily Beast
, I argue that the GOP’s inability to stand
for anything other than occasional attempts to screw poor people,
vilify brown people, and demagogue gays and lesbians is the main
reason its once-seeming lock on taking the Senate has
disappeared:

As the differences between the two parties are blunted, it’s no
wonder that Republican chances for retaking the Senate are
evaporating faster than those anticipated federal surpluses in the
early Aughts. “Democrats now have a 51 percent chance of holding
the Senate,” reports The Washington Post’s Chris
Cillizza, who notes that just a few months ago, the odds were
better than 80 percent that the Republicans would pick up six seats
to gain a majority in both houses of Congress….

In a two-party system, we’re effectively down to one party that
wants to keep spending essentially the same and to start a new war
without having to go on the record as voting for it or against it.
No wonder that just 25 percent of Americans identify as
Republican, according to Gallup, and the GOP probably won’t win the
Senate despite appalling poll numbers for Obama’s Democrats.
Because when you go from being stupid to being useless, voters are
smart to stick with the status quo, no matter how miserable it
might be.


Whole thing here.

from Hit & Run http://ift.tt/XQDfl3
via IFTTT

“The GOP’s metamorphosis from…the stupid party into [one] that is both stupid and useless is almost complete.”

Just
a few months ago, when Rep. Kevin McCarthy (R-Calif.) became the
House Majority Leader, he announced the the GOP would allow the
Export-Import Bank, which subsidizes purchases of goods made by
politically connected U.S. firms, to expire “because it’s something
the private sector can be able to do.”

That was then. The budget resolution approved by Congress
yesterday not only continues funding for the Export-Import Bank, it
signed off on the Iraq-Syria War of 2014 without actually putting
the matter to a constitutionally mandated vote:

The GOP, which claims to be the party that pledges maniacal
fealty to the Constitution, can’t be bothered to push for a
declaration of war, but it’s happy to shovel more borrowed money
toward a dodgy group of Syrians. “I frankly think the president’s
request is a sound one,” Speaker of the House John Boehner
told The Washington Times. The only real disagreement
among Republicans is whether to put American soldiers on the ground
to fight ISIS in Iraq and Syria, which appears to be what Sen. John
McCain is pushing for.

In a new column for

The Daily Beast
, I argue that the GOP’s inability to stand
for anything other than occasional attempts to screw poor people,
vilify brown people, and demagogue gays and lesbians is the main
reason its once-seeming lock on taking the Senate has
disappeared:

As the differences between the two parties are blunted, it’s no
wonder that Republican chances for retaking the Senate are
evaporating faster than those anticipated federal surpluses in the
early Aughts. “Democrats now have a 51 percent chance of holding
the Senate,” reports The Washington Post’s Chris
Cillizza, who notes that just a few months ago, the odds were
better than 80 percent that the Republicans would pick up six seats
to gain a majority in both houses of Congress….

In a two-party system, we’re effectively down to one party that
wants to keep spending essentially the same and to start a new war
without having to go on the record as voting for it or against it.
No wonder that just 25 percent of Americans identify as
Republican, according to Gallup, and the GOP probably won’t win the
Senate despite appalling poll numbers for Obama’s Democrats.
Because when you go from being stupid to being useless, voters are
smart to stick with the status quo, no matter how miserable it
might be.


Whole thing here.

from Hit & Run http://ift.tt/XQDfl3
via IFTTT

Stocks Slide As Gartman Goes "Long Of One Unit Of The US Equity Market:"

It just never, ever fails. From this morning’s Gartman letter:

SHARE PRICES AROUND THE WORLD ARE STRONGER and the news from Scotland should serve to keep the global bull market intact for markets do indeed disdain confusion and the confusion over the UK’s future has been relieved. All things being otherwise equal, this is supportive of shares generally.

 

Stare then… do not merely look; stare!… at the chart of the S&P at the bottom left of p.1 and try if you will to see anything bearish in that chart.

 

 

The “channel” defining the trend is stunningly well defined; the lows have held time after time after time, and hoping to be as clinically honest as we can be, presently we are but in the middle of this upward sloping channel. Certainly it may end at any time and many have argued that it has time after time in the past, but the trend obtains; the bears are proven wrong and every time we move from bullish to neutral we pay a price for having done so. There is a lesson to be learned here; would that we had learned it.

 

Long of One Unit of the US equity market:

 

To make if official, we were buyers of “aluminium” yesterday, to align our recommendations with those equity positions we have in our retirement fund. We do not name individual equities in TGL, but everyone knows which company here in America we mean. As long as the lows made earlier this week hold we’ll be a buyer and try our best to remain long, with out-of-the-money calls sold against it as a yield enhancement.

In short: best $29.95 one could ever spend.




via Zero Hedge http://ift.tt/XvYgRD Tyler Durden

Stocks Slide As Gartman Goes “Long Of One Unit Of The US Equity Market:”

It just never, ever fails. From this morning’s Gartman letter:

SHARE PRICES AROUND THE WORLD ARE STRONGER and the news from Scotland should serve to keep the global bull market intact for markets do indeed disdain confusion and the confusion over the UK’s future has been relieved. All things being otherwise equal, this is supportive of shares generally.

 

Stare then… do not merely look; stare!… at the chart of the S&P at the bottom left of p.1 and try if you will to see anything bearish in that chart.

 

 

The “channel” defining the trend is stunningly well defined; the lows have held time after time after time, and hoping to be as clinically honest as we can be, presently we are but in the middle of this upward sloping channel. Certainly it may end at any time and many have argued that it has time after time in the past, but the trend obtains; the bears are proven wrong and every time we move from bullish to neutral we pay a price for having done so. There is a lesson to be learned here; would that we had learned it.

 

Long of One Unit of the US equity market:

 

To make if official, we were buyers of “aluminium” yesterday, to align our recommendations with those equity positions we have in our retirement fund. We do not name individual equities in TGL, but everyone knows which company here in America we mean. As long as the lows made earlier this week hold we’ll be a buyer and try our best to remain long, with out-of-the-money calls sold against it as a yield enhancement.

In short: best $29.95 one could ever spend.




via Zero Hedge http://ift.tt/XvYgRD Tyler Durden

America’s Big Bet On Natural Gas And Big Short On Coal

Submitted by Chris Pedersen via OilPrice.com,

America is betting the kitchen sink on natural gas. No matter which estimate you look at — the U.S. Energy Information Administration, the International Energy Agency, or Wall Street banks — two things are clear: the United States is slated to consume enormous amounts of natural gas and the dominant fuel of electricity generation for the last 50 years, coal, is diminishing.

First, America’s energy darling: natural gas. It is difficult to overstate the effect shale gas production has had on the United States. In 2006, shale gas production accounted for about 5 percent of natural gas production. In 2013, it accounted for roughly 40 percent. As industry leaders clamored to take advantage of the vast supply of newly accessible domestic natural gas, analysts began to forecast longer and longer projections of low natural gas prices. The result is big expectations for natural gas.

The EIA expects natural gas production to grow at a 1.6 percent annual rate from 2012 through 2040, resulting in a dry natural gas production of 23.04 quadrillion BTU in 2013 and a production forecast of 38.37 quadrillion BTU in 2040. Demand will come from residential, commercial, and transportation use, but the largest demand increase will be from the electric power sector, particularly combined cycle power plants. Today, the U.S. has a combined cycle generating capacity of roughly 190 gigawatts. By 2040, capacity is forecasted to increase to approximately 316 gigawatts.

Meanwhile, the outlook for coal continues to appear bleak. This week, the Government Accountability Office released a new report with increased projections for the number of coal plants expected to retire in the coming years. The report estimates that 42,192 megawatts, or 13 percent of coal-fueled summer generating capacity, will retire between 2012 and 2025 as a result of environmental regulations, lower natural gas prices, and decreasing electricity demand. These retirements are on top of the 150 coal-fueled units with a summer generating capacity of 13,786 megawatts that have been retired since 2000.

America’s gamble will not affect everyone in the country equally. Almost 40 percent of the retired coal capacity will take place in in Ohio, Pennsylvania, Kentucky, and West Virginia. Fortunately, Pennsylvania, Ohio, and to a lesser degree West Virginia, have economies that will be better prepared for this transition as a result of surging production from the Marcellus and Utica shale plays.

The story is the same for exports. Last week, the U.S. Energy Department gave the final approval to build two more LNG export terminals.

The outlook for coal exports is much different. Last month, Oregon’s Department of State Lands denied a key permit to Australia-based Ambre Energy to build a coal export terminal on the Columbia River. On Sept. 15, Ambre Energy was dealt another blow when the U.S. Army Corps of Engineers denied its appeal. Corps spokesman Scott Clemans said, “We could do [the review] and make a yes or no determination, but given the lack of clarity right now as to whether the required state authorization is going to happen, and given the amount of time and energy we still need to devote to this project, it doesn’t make sense to devote resources to a project that may not happen.”  

For everyone’s sake, let’s hope the gamble pays off. Because if natural gas fails to live up to the high expectations, there will be less coal to back it up




via Zero Hedge http://ift.tt/XvYg48 Tyler Durden

Only YOU Can Prevent College Sexual Assaults Say Obama and Biden

More “campus rape crisis” weirdness came from the White House
today, where President Obama and Vice President Biden announced the
launch of a new initiative called “It’s on Us”. The campaign will feature
celebrity-studded public service announcements aired during college
sporting events and promotions from the likes of MTV, BET, and
video-game company Electronic Arts. 

In explaining the initiative
on the White House blog
, Jeffrey Zients—Obama’s economic
adviser (because nothing about this makes any sense)—wrote that
“It’s on Us” is “not just a slogan or catchphrase”:

It’s the whole point. Because in a country where one in five
women on college campuses has been sexually assaulted— only 12
percent of which are reported—this is a problem that should be
important to every single one of us, and it’s on every single one
of us to do something to end the problem.

Reading Zients’ post, I was reminded of author and professor
Joel Best speaking on the hallmarks of how media hype (and
the attendent bogus statistics
) get promulgated: First there is
a high-profile tragic event, then the need to define the event as
part of an identifiable Problem (“the heroin epidemic”), and then a
desire to quantify the problem so as to place it in a larger
context. I put “campus rape crisis” in quotes not to diminish the
seriousness of sexual assault but because I think the phrase is a
prime example of the phenomenon Best describes. Rape is a problem
wherever it happens, which is sometimes on campus and more
frequently not. The “campus rape crisis” is a thing perpetuated by
people interested in profiting from the fear in various ways.

When you make up a problem—and again, let’s be clear that I’m
not saying rape, the underreporting of rape, or the way campuses
handle rape is a made-up problem, but rather the idea that college
campuses are some sort of rape epicenter—it is much easier to get
credit for solving that problem. The White House doesn’t actually
have to impact rape rates or rape prosecution rates or anything
tangible, because that’s not how it has defined the problem. It’s
central concern is raising awareness about rape on
college campus, a goal both amorphous and measurable in Facebook
likes.

What’s “on us”, according to the newly-launched campaign
website, is the imperative “to recognize that non-consensual sex is
sexual assault”, “to identify situations in which sexual assault
may occur”, “to intervene in situations where consent has not or
cannot be given,” and “to create an environment in which sexual
assault is unacceptable and survivors are supported.” If you agree
with these vague statements, you can take The Pledge: “a personal
commitment to help keep women and men safe from sexual assault” and
“a promise not to be a bystander to the problem, but to be a part
of the solution.” I took the pledge and received the following
message:

Thank you for your commitment to stopping sexual assault. Turn
your profile photo into an It’s On Us badge to show your pledged
commitment to helping stop sexual assault.

The It’s on Us site also offers sexual-assault prevention tips,
which range from the banal (“keep an eye on someone who has had too
much to drink”) to the oddly aggressive. “If you see something,
intervene in any way you can”, says one. “Get in the way by
creating a distraction, drawing attention to the situation, or
separating them” says another. The focus on “bystander
intervention” comes across unsettling—less an insistence that
friends help friends avoid creeps than a world where one’s to be on
the lookout always for ways to stop strangers from serving each
other drinks. 

It’s not a terrible campaign, all-around. Some of the tips are
sensible. And a sexual-assault prevention initiative aimed equally
at men and women that explicitly eschews victim blaming and
highlights the importance of consent is actually pretty radical. If
this were a campaign run by MTV or a private foundation or a
network of college campus-groups, I might be more applauding of
their efforts. But I reject that this is a job for the President
and Vice President. 

And I reject the larger premise of the It’s on Us campaign: that
all societal problems require federal government action, and that
college sexual assaults in particular are an area in need of
“bystander intervention” from Uncle Sam. Zients says “this new
initiative will help move (the Administration’s) work forward
by creating a new energy and awareness around these issues on
campuses across America.” I’m convinced this campaign is designed
to advance the White House’s goals, just not in the way Zients
suggests. 

from Hit & Run http://ift.tt/1tyrImR
via IFTTT

How Many Billions Will Bombing ISIS Cost? What About Other Radicals?

While the Obama administration splits hairs over
whether literally having armed American soldiers on Iraqi soil
counts as “troops
on the ground
” (hint: It does) and quibbles about whether it’s
a good idea to arm so-called moderate rebels in Syria to fight ISIS
(hint:
The CIA says it’s not
), the U.S.’s primary strategy in Iraq War
III has been airstrikes. How many billions of dollars is this going
to cost America, though?

It’s an important question posed by
Foreign Affairs, which calculates that “current estimates
put the yearly price tag for ISIS bombings at anywhere between $2.7
billion, if the current pace continues unchanged, and $10 billion,
if the United States escalates the air campaign and expands it into
Syria.” Obama has
suggested
that fighting the Islamic state will take three
years. The U.S. began conducting air surveillance over Syria last
month, but so far has not dropped bombs.

Foreign Affairs contrasts this war with the
March-October 2011 bombing campaign in Libya, which “was shared
among several allies,” and cost about $1.1 billion. The global
price tag of bombing the Islamic State will rise since France just
initiated its own campaign
today
.

The journal has put together some
impressive data on this war alongside comparisons to the U.S.’s
other air campaigns in countries like Yemen and Somalia, and notes
that “in the sheer number of strikes, the intensity of the U.S.
effort against ISIS has already exceeded both of these much
longer campaigns.” The U.S. has already conducted 174 strikes in
about a month’s time (two since
this Wednesday
), compared to 350 in Pakistan, which we’ve been
bombing since 2008. 

Also notable is that in past campaigns, “airstrikes took a small
but significant toll on the civilian population.”

The three-year war plan makes a big assumption that things go
smoothly, which looks less and less likely as more volatile groups
emerge.

There are now over 50 Iran-backed Shiite Muslim militias
fighting ISIS, which is Sunni Muslim. Foreign Policy

notes
that these “highly ideological, anti-American” groups
commit human rights violations that make them hardly better than
the Islamic State. They’re doing just as much as their enemy to
undermine the Baghdad government’s claim to authority, and they’re
throwing a huge wrench in “Obama’s stated
goal
 of working with an inclusive Iraqi government to push
back [ISIS].”

There’s a big can of worms, and the president can’t seem to
resist opening it. 

from Hit & Run http://ift.tt/1qRHxFv
via IFTTT