Jim Sinclair’s Commentary
Mr. Williams shares the following with us.
- Existing-Homes Sales Collapse Consistent with Deepening Recession, Even Allowing for Special Factors
- Rapidly Mounting Odds for Fourth-Quarter GDP Contraction
- GDP Revisions Were No More than Statistical Noise; Third-Quarter Gain of 1.98% Was Not Statistically Significant; Annual Growth at Six-Quarter Low
- With Rate-Hike Speculation Temporarily Sated, Deteriorating Economy Should Hit U.S. Dollar Hard, Boosting Gold, Silver and Oil Prices, and Domestic Inflation
“No. 775: GDP Revision, November Existing-Home Sales ”
- Net of Inflation and Commercial Aircraft Orders, November Durable Orders Were Stronger than the Headline “Unchanged”
- Nonetheless, Smoothed Orders in This Volatile Series Still Were Consistent with an Unfolding Recession
- New-Home Sales Continued in a Smoothed Pattern of Deepening Down-Trend, Low-Level Stagnation
“No. 776: November Durable Goods Orders, New-Home Sales ”
Russia, Iran eye monetary agreement to boost trade
December 22, 2015, 1:25 pm
A senior Iranian official said on Tuesday that Iran and Russia will sign a joint monetary agreement to facilitate mutual trade transactions, state media reported.
The agreement is aimed to facilitate exchange of Iran’s rials and Russia’s roubles, and it will also pave the way for boosting Tehran-Moscow economic relations, Iranian Minister of Communications Mahmoud Vaezi was quoted as saying by state news agency IRNA.
Vaezi made the remarks after a meeting with visiting Russian Minister of Industry and Trade Denis Manturov.
Vaezi said two sides discussed the ways to remove obstacles to bilateral cooperation during the meeting, adding that Russia will take steps towards decreasing its customs tariff in line with Iran’s interests.
For his part, the Russian minister stressed the importance of increasing joint investments.
Cordial relations between Tehran and Moscow have prepared good grounds for expansion of economic cooperation, Manturov said.
Following the downing of a Russian warplane by Turkey near Syrian border last month, Iran urged Russia for the ease of customs duty for its agricultural exports.
Jim Sinclair’s Commentary
Merry Christmas from Mr. Black and Yahoo
December 23, 2015
En route to Abu Dhabi
Do you remember the first website you ever visited?
I do. It was Yahoo!
The year was 1995. Toy Story was the #1 movie in the world. The Oklahoma City bombings claimed the lives of 168 people. War and genocide raged in the ongoing Balkan conflict.
America Online and Prodigy, both early Internet pioneers, offered the public access to the “information superhighway” for the first time.
And a couple of engineers from Stanford University formally incorporated their new ‘search engine’ and brought it online as Yahoo.
It was mesmerizing. The site was a treasure trove of information with vast lists of other websites pertaining to every category under the sun.
And the search feature could help you find exactly what you were looking for. It was amazing.
The first time I used it I remember feeling like I had been transported into the future.
Yahoo quickly became one of the kings of Silicon Valley, drawing in more visitors than any other website in the world.
The following year they went public at a price of $13 per share. Investors loved the company and were convinced it would go to the moon.
And it did. For a time. Yahoo’s stock price peaked at $118 on January 3, 2000, marking almost to the day the top of the dot-com bubble.
Fast forward nearly 16 years and the company is a shell of its former self.
Its stock is down more than 70% from its all-time high, and the price hasn’t gone anywhere for more than two years.
More importantly, Yahoo isn’t making money.
The company has posted several consecutive quarters of negative operating income. Revenue is declining. Its traffic rank has fallen.
They’ve had to lay off thousands of brilliant engineers they can no longer afford to retain.
Plus they’ve made tons of bonehead acquisitions, squandering billions of dollars on investments that have produced nothing for the company.
One would think that a company in such obvious decline would demonstrate a modicum of frugality.
Think again. Yahoo’s annual Christmas party this year was a Roaring 20s / Great Gatsby theme, complete with champagne towers and a vintage Rolls Royce.
The party itself, right down to the theme, was a symbol of waste, indulgence, and excess; it reported costly between $7 and $10 million to stage.
I mean, the only thing more excessive would have been a Caligula remake.
I have to imagine stakeholders are wondering: what are these people thinking?
The good old days are long gone. This is no longer a company that can afford such largess. And everyone seems to realize it… except Yahoo.
Frankly I find this the perfect metaphor for the United States of America.
Despite political candidates saying that “America’s best days are ahead of us,” the United States peaked a long time ago.
US debt is higher than it’s ever been, and the government still loses money every year.
Even in their most wildly optimistic projections, they have no expectation of a budget surplus. Ever.
The Congressional Budget Office estimates that the national debt, both nominally and as a percentage of GDP, will continue to increase.
You’d think they would recognize such an obvious fiscal reality.
But no. They keep spending, oblivious to the fact that they can no longer afford the largess. These guys are partying like it’s 1929.
Like Yahoo, the US used to be king of the hill. But now it’s in clear decline.
Government finances are a total mess. The middle class has been vanquished and no longer comprises the majority of the population anymore.
The monetary and regulatory systems encourage debt and consumption, instead of savings and production.
Political power is derived from fear and intimidation. And the government rules with an ethos that debt, money printing, and more bureaucracy will make the country prosperous and strong.
When it comes time to spend money, there’s no frugality. No agency left behind.
And after they ink the legislation that will spend a record $4 trillion of taxpayer money on war, debt, and unsustainable entitlement programs, they slap each other on the back for a job well done.
If you step back and look at the big picture, it’s obvious that this ‘party like it’s 1929’ mentality is not consequence free.
No one (least of all Yahoo!) would have predicted back in 1998 that they would soon become an irrelevant has-been. Yet it happened nevertheless.
History shows us that nations too rise and fall– gradually, then suddenly.
It’s not like there’s some cataclysm that’s going to cause the ground to open up and swallow America tomorrow morning. This isn’t that kind of emergency.
Plus governments and central bankers have an astonishing ability to kick the can down the road just a little while longer.
But no one can stop the tidal wave of consequences that grows with every terrible decision they make.
Whether people like it or not, whether they choose to acknowledge it or not, this decline is a long, slow grind that’s already in progress.
Maybe it takes 3 years to play out. Maybe it takes 30. No one can say for sure where the bifurcation point is that tips stability into chaos.
But to simply buy into the official propaganda and make a conscious decision to ignore such obvious data is completely foolish.
Rational people have a Plan B.
And it’s hard to imagine you’ll be worse off for taking sensible steps to protect yourself against the consequences of one of the biggest trends in history.
Enjoy the holidays,