Tuesday, September 29, 2015

Not Enough Gold to Pay All Holders of Gold Obligations

"Below, is a chart (from macrotrends.com) that shows the ratio of the gold price to the St. Louis Adjusted Monetary Base back to 1918. That is the gold price in US dollars divided by the St. Louis Adjusted Monetary Base in billions of US dollars. So, for example, currently the ratio is at 0.28 [$1 125 (current gold price)/ $4 019 (which represents 4 019 billions of US dollars)].
Gold to Monetary Base Ratio Since 1920
Historically when this ratio was going down, then there are more claims on gold than what was actually being held by the Federal Reserve or US Treasury (for more on this ratio). At some point after the ratio is going down there would be pressure to fulfil gold obligations due to the shortage of physical gold compared to claims on gold. This pressure often comes after a significant change in conditions such as after a stock market peak. Just like financial fraud is often discovered when business is slow, as was possibly the case with Bernie Madoff..."
at http://www.marketoracle.co.uk/Article52472.html

Forget Glencore: This Is The Real "Systemic Risk" Among The Commodity Traders

"Back in July, long before anyone was looking at Glencore (or Asia's largest commodity trader, Noble Group which we also warned last month was due for a major crash, precisely as happened overnight) which everyone is looking at now that its CDS is trading points upfront and anyone who followed our suggestion last March to go long its then super-cheap CDS can take a few years off, we had a rhetorical question:
Judging by what happened less than two months later, it appears that we have our answer: for now at least, Glencore, which is now flailing and which Bloomberg reported moments ago is set to meet with its bond investors tomorrow (supposedly to allay their fears of an imminent insolvency), is firmly the "answer" to our rhetorical question.
And yet, something stinks.
First, a quick look at Trafigura bonds reveals that the contagion from the Glencore commodity-trader collapse, which "nobody could possibly predict" two months ago and which has rapidly become the market's biggest black swan, has spread and we now have a new contender. And while Trafigura's equity is privately held, it does have publicly-traded bonds. They just cratered:

... sending the yield soaring to junk-bond levels.

As discussed below, this may just be the beginning for the company which, because it does not have publicly traded equity - but has publicly traded debt - has so far managed to slip under the radar.
But who is Trafigura? Only the world's third largest private commodity trader after Vitol and Glencore..."
at http://www.zerohedge.com/news/2015-09-29/forget-glencore-real-systemic-risk-among-commodity-traders

Investment Grade Credit Risk Hits 2 Year High (And Why That's A Disaster For Stocks)

"Over the past few years three things have 'worked' - Buybacks, Biotechs, and Buying IPOs. Those days are now over...

Biotechs have imploded...
*  *  *
But, by far the most important of all was the low-cost financing of float-reduction (buying back shares via releveraging)...

Investment Grade credit spreads are at 2-year wides, spiking higher in recent days, raising the cost of financing those record-breaking non-economic buybacks for even the most pugnacious CFO. As is clear above, with a lag (i.e. we borrow and then we spend) the cost of financing and the relative performance of firms buying back their shares is extremely highly correlated (and while correlation is not causation, we suspect in this case - from simple Corporate Finance theory - it is winking rather clearly)..."
at http://www.zerohedge.com/news/2015-09-29/investment-grade-credit-risk-hits-2-year-high-and-why-thats-disaster-stocks

IMF Flashes Warning Lights for $18 Trillion in Emerging-Market Corporate Debt

"Emerging markets should brace for a rise in corporate failures as a debt-bloated firms struggle with souring growth and climbing borrowing costs, the International Monetary Fund warned Tuesday in a new report.
From sugar firms in Brazil to pipe makers in Russia, firms in developing countriesbulked up on cheap debt as central banks gassed the easy-money pedal in the wake of the financial crisis.
Then, emerging markets were the drivers of global growth. Developing-country firms quadrupled their borrowing from around $4 trillion in 2004 to well over $18 trillion last year, with China accounting for a major share.
Now, prospects in industrializing economies are weakening fast even as the U.S.Federal Reserve is getting set to raise interest rates for the first time in nearly a decade, a move that will raise borrowing costs around the world. The burden of 26% larger average corporate debt ratios and higher interest rates come as commodity prices plummet, a staple export for many emerging-market economies. Compounding problems, many firms borrowed heavily in dollars. As the greenback surges against the value of local currency revenues, it makes repaying those loans increasingly difficult.
That massive debt build-up means it is “vital” for authorities to be increasingly vigilant, especially to threats to systemically important companies and the firms they have links to, including banks and other financial firms, the IMF said.
“Emerging markets should also be prepared for the eventuality of corporate failures,” the fund said. “Where needed, insolvency regimes should be reformed to enable rapid resolution of both failed and salvageable firms.”
Besides the petroleum sector, where borrowing didn’t anticipate the nosedive in prices, the construction industry is particularly exposed to the changing business climate, the IMF said.
Worried about the building risks, investors have been selling out of many emerging markets, pushing down equity and exchange-rate prices, and pushing up borrowing costs. That market turmoil is exacerbating their economic woes.
In Latin America’s six largest economies, for example, the average growth rate has fallen from 6% in 2010 to around 1% this year. Brazil’s central bank last week said the country’s recession is far worse than expected.
To help guard against building risks, the IMF said policy makers should introduce stronger financial regulations such as higher cash buffers for exchange-rate exposures and conduct stress tests to weed out problem firms..."
at http://blogs.wsj.com/economics/2015/09/29/imf-flashes-warning-lights-for-18-trillion-in-emerging-market-corporate-debt/?mod=WSJBlog

Striking Weakness in Home Prices

"For the third month in a row, the Case-Shiller 20-city seasonally adjusted home price index declined. Last month was revised lower. Economists were surprised.

The Bloomberg Econoday Consensus was for a month-over-month rise of 0.1%, instead prices declined by -0.2%..."
at http://globaleconomicanalysis.blogspot.com/2015/09/striking-weakness-in-home-prices.html#4Kd6atWsTwuaSdOK.99

Gold Daily and Silver Weekly Charts - Roll On Big River of Gold

"People take their fashions from the leadership.  And the leadership and role models in our culture are emblematic of our failures.

In the news, Swiss Name Seven Banks In Precious Metals Rigging Probe.

Precious metals took a hit today, as I thought that they might. 

The rally last week had more to do with the option expiration than it did with disclosures of physical tightness of gold bullion in particular.

Glencore the commodity firm took a big hit today based on a sell-side analysts forecasts of doom.

The miners were taken out to the wood shed.  I am seeing some big companies priced at levels I was buying them in 2002.  .

I do believe this is going to come down to hard tacks.  The bullion buyers of the world markets are going to keep the physical flow going until something breaks.

The  wiseguys lack all restraint, and the regulators are failing to provide adult supervision because of conflicted interests and.utopian ideologies about 'naturally free markets.'

The bubble in junk paper is rolling over as can be seen on the chart below.  It has plenty of room below it thanks to the Fed's misdirected policy errors.

There was very little activity at The Bucket Shop to report on from Friday.

Potential claims per ounce of register gold are 262:1.    The shills and trolls say don't look at it, means nothing.  As well they might, as their true loyalties demand.   They mention everything except that this has never happened before in the last twenty years. 

But it means nothing.  Don't trust your lying eyes.  Most everything is being settled on the side, over-the-counter, at undisclosed prices so as not to perturb the public pricing structure. And yet so little actually leaves the warehouses, at least for gold.  Odd market price discovery mechanism that. 

London is where the physical bullion is gathered, and it is flowing in an easterly direction.

Roll on, gold float, roll on..."

at http://jessescrossroadscafe.blogspot.com.tr/2015/09/gold-daily-and-silver-weekly-charts_28.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+JessesCafeAmericain+(Jesse%27s+Caf%C3%A9+Am%C3%A9ricain)

Panic Is Beginning To Engulf The World

"With Japan’s stock market plunging nearly 4 percent as fear spreads across the globe, today King World News is pleased to share an extraordinary piece which takes a look at the remarkable panic that is beginning to engulf the world.  This piece also includes a key illustrations that all KWN readers around the world must see.
September 29 (King World News) – Jason Goepfert at SentimenTrader:  The Market CDX North America High-Yield Index (CDX) jumped 20% on Monday. That’s the largest jump in at least a decade, as traders scramble to buy protection against widespread defaults in high-yield bonds (see chart below).
SentimenTrader I 9:29:2015
A month after the 5 times it jumped 15% or more in a day, the S&P 500 was higher each time by an average of 3.1%. A month after it jumped 10% or more, the S&P rose 13 out of 18 times (see chart above).”
King World News note:  If you look at the chart you can see the panic spike above above the 500 level that is the massive 20 percent surge that SentimenTrader was noting.  That surge represents serious fear.  It will be interesting to see if disaster strikes or if the central planners are able to smooth things over once again..."
at http://kingworldnews.com/panic-is-beginning-to-engulf-the-world/

Is The Global House Of Cards Finally Going To Collapse?

"With fear beginning to spread across world markets, today King World News is featuring a powerful interview that answers the all-important question: Is the global house of cards finally going to collapse?
September 29 (King World News) – James Turk:  “Markets are always testing our suppositions about them, Eric, proving whether we are right or wrong. And right now two key markets are at a major turning point — stocks and the dollar…"
at http://kingworldnews.com/is-the-global-house-of-cards-finally-going-to-collapse/

Monday, September 28, 2015

With $19 Billion In Derivative Liabilties, Some Observations On Glencore's "Counterparty Risk"

"Now that after long last the market has turned its attention not only to Glencore's mining operations, which as we have repeated said are a secondary aspect to the company's business model, the key being its trading operations which transact in billions of commodities every single day, and the stocks just plunged to fresh intraday lows down a historic 30%, here is a quick pointer at what traders should be looking at next: the company's own disclosure on counterparty risk from its most recent annual report.
But before we get into it, here is a reminder of Glencore's most recent disclosed financial situation: $30Bn net debt on $6.5bn in EBITDA. EBITDA, which as a reminder, drops by $1.2BN for every 10% drop in copper prices according to the company itself..."

at http://www.zerohedge.com/news/2015-09-28/19-billion-derivative-liabiltiies-some-observations-glencores-counterparty-risk

UBS Is About To Blow The Cover On A Massive Gold-Rigging Scandal

"With countless settlements documenting the rigging of every single asset class, it was only a matter of time before the regulators - some 10 years behind the curve as usual - finally cracked down on gold manipulation as well, even though as we have shown in the past, central banks in general and the Fed in particular are among the biggest gold manipulators.
That said, we are confident by now nobody will be surprised that there was manipulation going on in the gold casino. In fact, ever since Germany's Bafin launched a probe into Deutsche Bank for gold and silver manipulation, it has been very clear that the only question is how many banks will end up paying billions to settle the rigging of the gold market (with nobody going to prison as usual, of course).
Earlier today, we learned that the Swiss competition watchdog just became the latest to enjoin the ongoing gold manipulation probe when as Reuters reported, it launched an investigation into possible collusion in the precious metals market by several major banks, it said on Monday, the latest in a string of probes into gold, silver, platinum and palladium pricing.
Here are the details that should come as a surprise to nobody:
Global precious metals trading has been under regulatory scrutiny since December 2013, when German banking regulator Bafin demanded documents from Deutsche Bank under an inquiry into suspected manipulation of gold and silver benchmarks by banks. Even though the market has moved to reform the process of deciding on its price benchmarks, accusations of manipulation have refused to go away.

Switzerland's WEKO said its investigation, the result of a preliminary probe, was looking at whether UBS, Julius Baer, Deutsche Bank, HSBC, Barclays, Morgan Stanley and Mitsui conspired to set bid/ask spreads.

"It (WEKO) has indications that possible prohibited competitive agreements in the trading of precious metals were agreed among the banks mentioned," WEKO said in a statement.
Don't hold your breath though: "A WEKO spokesman said the investigation would likely conclude in either 2016 or 2017,adding that the banks were suspected of violating Swiss corporate rules." Those, and virtually all other market rules.
The good news is that unlike Bart Chilton's charade "inquiry" into silver manipulation when after years of "probing" the CFTC found "nothing", at least the Swiss will find proof of rigging for the simple reason that it is there.
he banks face financial penalties if WEKO finds them guilty of wrongdoing, the spokesman said, though he declined to comment on the size of any possible fine.
No please, anything but "financial penalties" for rigging the gold market.
Aside from regulatory probes, a number of lawsuits have also been filed in U.S. courts alleging a conspiracy to manipulate precious metals prices.

Commenting on the WEKO probe, a Julius Baer spokesman said the bank was cooperating with authorities.

In a statement, Deutsche Bank said it was cooperating with requests for information from "certain regulatory authorities" over precious metal benchmarks but declined to comment further.

Representatives for UBS, Barclays, Morgan Stanley and HSBC declined to comment. Mitsui was not immediately available for comment.
Some so-called experts promptly scrambled to talk down the upcoming proof that so-called "paranoid" gold bugs have been right all along:
The impact of the probes on wider precious metals trading was likely to be muted, according to Brian Lucey, professor of finance at the School of Business, Trinity College Dublin.

"The question is not if individuals, or groups of individuals are collaborating to rig the game for themselves, the question is if this has any material effect," he said. "I'm not convinced collusive behaviour will have a meaningful effect micro-economically to the structure of gold trading around the world."
Oh so the question is not if traders and banks made billions in illegal profits by rigging yet another market, but "if this has any material effect." Give this man another distinguished financial professorship title: with observations like that what can one say but... "Keynesian genius."
* * *
However, as we said above, none of the above, and certainly not the idiotic "finance professor" statements, will come as any surprise to anyone.
What will, however, is that unlike previous gold probe cases, this one will actually have consequences.
How do we know?
Because just like in LIBOR-gate, just like in FX-gate, it is the biggest rat of all, Swiss megabank UBS, that is about to turn on its former criminal peers.
As Bloomberg reported earlier "UBS was granted conditional leniency in Swiss antitrust probe of possible manipulation of precious metal prices, a person with knowledge of the matter said."
Bloomberg adds that the "bank may face lower fine than six other banks and financial firms suspected in probe or may avoid penalty altogether, person says."
Why would UBS do this? The same reason UBS did so on at least on two prior occasions: the regulators have definitive proof it is involved, and gave it the option to turn evidence and to rat out its cartel peers, or face even more massive financial penalties.
UBS promptly chose the former, and took the opportunity to minimize yet another key civil (and criminal) market manipulation charge against it, especially after it was already branded a "criminal recidivist" between Libor, FX and, of course, the tax evasion scandal: one more manipulation scandal and the bank could well lose its license to operate in NYC.
Which simply means that now the official countdown on the announcement of what will be revealed as the biggest gold-manipulation and rigging scandal in history, has begun."
at http://www.zerohedge.com/news/2015-09-28/ubs-about-blow-cover-massive-gold-price-rigging-scandal

FX Liquidity Is Tumbling To Dangerous Levels

"Back in the summer of 2013, the Treasury Borrowing Advisory Groupmade a very explicit plea to the Treasury (and the Fed): please help us, liquidity in bond markets is plunging; the plea was so loud the Fed - whose monetization of Treasurys remains the primary culprit for the collapse in fixed income liquidity - promptly announced it would first taper, and then completely halt QE (at least until such time as Congress provided a generous surge in monetizable debt).
It took the peanut gallery a few years to pronounce that "everyone is worried about bond market liquidity", even though this had been clear for years to anyone who actually traded bonds in these broken markets.
A far more concerning development over the same period has been not so much the evaporation of equity, or debt, liquidity but that of the one "market" which central banks have no qualms about intervening on a daily basis: currencies. A recent example of just how thin liquidity had become in FX took place on March 18 during the infamous USD flash crash, when just after the market close, the USD index went, well, "crazy"

Furthermore, as we also discussed in the past year, one of the primary reason why FX liquidity has imploded is that after soaking up commodity, bond and equity markets in the past several years, HFT firms such as Virtu decided to make FX their latest trading arena..."

at http://www.zerohedge.com/news/2015-09-28/fx-liquidity-tumbling-dangerous-levels

The Week Begins On A Scary Note

"The US markets awoke to news of several big, disturbing overseas events:
Glencore implodes. Think of Swiss commodities giant Glencore as a modern version of Enron, in the sense that it owns physical assets like mines and oil wells around the world and runs perhaps the biggest commodities derivatives trading desk. And — also like Enron — it’s apparently unprepared for extreme commodity price volatility. This morning its stock price plunged even further and its credit default swaps — the cost of insuring payment on its its bonds — blew out to record levels.
If Glencore loses its investment grade rating as now seems likely, its access to cheap capital will evaporate and it will fail. This matters for several reasons, the most important of which is the company’s unspecified but certainly huge derivatives book which, like AIG’s in 2008, is a serious threat to the leveraged speculating community.
Commodities from oil to gold are down hard on the news.
Saudi Arabia cashes out. The world’s dominant oil exporter can’t pay its bills with crude at $50 a barrel so it’s spending down foreign exchange reserves and borrowing hand over fist. This morning it was reported that the Saudi sovereign wealth fund — a major player in global bond and equity markets — was cashing out and bringing its money back home.
The amounts in question — $70 billion so far — are potentially a big deal for the funds that manage this money and are now seeing major outflows. According to one article:“Institutions such as State Street, Northern Trust and BNY Mellon…are therefore also likely to have been hit hard by the Gulf governments’ cash grab.”
VW execs investigated for fraud. Illustrating the difference between car makers and banks, the German government is considering criminal charges for the actual human Volkswagen executives responsible for falsifying auto emission results. That’s good for the world in general but potentially very bad for the German economy, which is a big exporter of cars, and for global equity indexes, which include the major car companies.
Stock markets around the world were spooked by these and other stories, with most major exchanges down between 1% and 2%..."
at http://dollarcollapse.com/stock-prices/the-week-begins-on-a-scary-note/

These Are Perilous Times And A Great Shock Is Coming

"With the Dow currently down 230 points, today a 50-year market veteran warned King World News that these are perilous times and a great shock is coming.
September 28 (King World News) – John Embry:  “It is business as usual in the precious metals market after a flurry last Thursday when gold rose 2 percent and was immediately met with a wall of selling.  I laughed when I saw Kitco attributed to the rally to short covering, only to see that theory destroyed when open interest rose over 8,000 contracts that day…
“The U.S. authorities must be petrified behind the scene as they see their economy weakening noticeably — a fact that is at odds with their bogus economic releases.  The U.S. stock market is also under pressure once again and more and more countries are talking about eliminating the dollar from international transactions.
A Shock Is Coming When The Great Charade Finally Ends
But this charade will continue until it ends, and when it does there will be a reset in gold and silver prices to the upside that will come as a shock to many observers.  There is abundant evidence that physical supply is becoming tight in both gold and silver.  There is considerable backwardation in the London market.  This is something that should never happen under normal circumstances.  It is just another indication of a very tight physical market..."
at http://kingworldnews.com/these-are-perilous-times-and-a-great-shock-is-coming/

LAWRIE WILLIAMS: Latest SGE gold deliveries suggest enormous 2015 total of over 2650 tonnes!

"The huge level of weekly Shanghai Gold Exchange delivery numbers is becoming something of a repetitive news item and is perhaps losing its impact, but it shouldn’t.  Week 37 (ending September 18th) saw another 63 tonnes delivered out of the Exchange, which makes the year to date total 1,892 tonnes – 281 tonnes more than at end week 37 in the massive 2013 record year for Chinese gold consumption.  If we extrapolate from the year to date figure this would suggest total SGE gold withdrawals for the year would come to an enormous 2,650 tonnes or higher – equivalent to over 80% of total global supply of new mined gold.  With SGE deliveries usually rising late in the year in the long build-up to the Chinese New Year, which falls on February 8thnext year, we certainly shouldn’t discount the likelihood of this level being achieved, or even bettered.  There seems to be no slowdown happening as yet.
Overall, SGE deliveries started to pick up in early July (normally one of the weakest months of the year) and have averaged 62 tonnes a week since then.  The figure for the week ended September 11th was the third highest weekly total ever
12 week withdrawal figures on SGE to September 18th
SGE Withdrawal week ended
Physical gold withdrawn
July 3rd
44.3 tonnes
July 10th
61.8 tonnes
July 17th
69.2 tonnes
July 24th
73.3 tonnes
July 31st
53.3 tonnes
August 7th
56.1 tonnes
August 14th
65.3 tonnes
August 21st
73.0 tonnes
August 28th
59.9 tonnes
September 4th*
36.8 tonnes*
September 11th
73.7 tonnes
September 18th
63.2 tonnes
729.9 tonnes
*September 4th figures are for a three day trading week with the Exchange closed for the Chinese Victory Day celebrations on the Thursday and Friday.
These figures fly in the face of the same mainstream analysts’ estimates of Chinese demand this year, which they say is slipping, along with the nation’s declining GDP growth rate – although this is still currently estimated at over 6% .  The disparity between the SGE figures and the analysts’ assessments of Chinese consumption is ever growing – and this year looks as though the difference by the year end may be as much as 1,500 tonnes or more.   
As we have noted before, a significant proportion of the difference is down to how the analysts estimate ‘consumption’.  Demand categories such as gold used in financial transactions tends to be ignored by the analysts, yet this is still gold flowing into China and in terms of gold movement from West to East remains hugely relevant..."

at http://news.sharpspixley.com/article/lawrie-williams-latest-sge-gold-deliveries-suggest-enormous-2015-total-of-over-2650-tonnes!/238625/

Sunday, September 27, 2015

Dear Janet Yellen, Here Is All You Need To Know About The US Economy: True Unemployment Is Over 12%

"One of the great mysteries surrounding the US economy is the seemingly inexplicable discrepancy between the plunging unemployment rate on one hand, which at 5.1% in August was the lowest since April of 2008 - a data point which on the surface would suggest virtually no slack in the labor force -  and the crawling pace of growth of the broader economy, on the other hand, namely the deterioration in US output and labor productivity, and the constant failure of wages to actually grow despite constant predictions by economists and pundits over the past 5 years that "wage growth is just around the corner."
This relationship has had a name since 1962 when Arthur Melvin Okun first observed the empirical relationship between unemployment and losses in a country's production. It is called Okun's law.
In theory, the original statement of Okun's law said that a 2% increase in output corresponds to a 1% decline in the rate of cyclical unemployment; a .5% increase in labor force participation; a .5% increase in hours worked per employee; and a 1% increase in output per hours worked (labor productivity). Okun's law states that a one point increase in the cyclical unemployment rate is associated with two percentage points of negative growth in real GDP. The relationship varies depending on the country and time period under consideration.
As the chart below shows, the "Okun Law" relationship has been one of the empirically observed mainstays of the US economy, with the real GDP growth rate constantly superimposed on top of the inverted unemployment rate... until 2010 when something snapped.

To be sure, both we and others have commented on the unprecedented discrepancy between the "strong" economy dictated by the unemployment rate, and the "weaker" economy signaled by virtually every other indicator, certainly the annual growth rate of US GDP, which in Q3 rose 2.7% from a year ago.
Back in 2012 we first asked "Is Okun's Law The Latest Casualty Of Central Planning" (incidentally, the answer is yes). Then several months later it was the turn of WSJ's Jon Hilsenrath to follow up on our observations with his own question: "How can an economy that is growing so slowly produce such big declines in unemployment?"
Something about the U.S. economy isn't adding up. At 8.3%, the unemployment rate has fallen 0.7 percentage point from a year earlier and is down 1.7 percentage points from a peak of 10% in October 2009. Many other measures of the job market are improving. Companies have expanded payrolls by more than 200,000 a month for the past three months, according to Labor Department data. And the number of people filing claims for government unemployment benefits has fallen. Yet the economy is barely growing. Many economists in the past few weeks have again reduced their estimates of growth. The economy by many estimates is on track to grow at an annual rate of less than 2% in the first three months of 2012. The economy expanded just 1.7% last year. And since the final months of 2009, when unemployment peaked, the economy has expanded at a pretty paltry 2.5% annual rate."
Fast forward to September 2015 when the same questions keep popping back: in fact, since 2013 the economic slowdown has only grown more acute manifesting itself in last week's failure by the Fed to hike rates: a direct confirmation that nothing with the US economy is as strong as the 5.1% unemployment rate suggests.
In the meantime, our conclusion from our June 2013 take on "Broken Okun" is still applicable:
Something is way off: either the unemployment data is very much wrong and the real unemployment rate is far higher especially when normalized for the collapsing labor participation rate and the surge in part-time and temp workers, or the GDP calculation is incorrect and the economy is growing at a 4%+ rate. (It isn't).The scarier implication is that in addition to all other seasonally adjusted economic data points which have become painfully unreliable, daily Treasury tax receipts must also now be added to the docket of meaningless and corrupt data points. The question of just how the Treasury could explain a massive (and deficit boosting) cash discrepancy could only be answered if somehow the Fed is found to be parking cash directly into the Treasury's secret basement.

But that would be very illegal...

Obviously, the US economy is not growing at a 4% pace, although following next month's wholesale revision of the GDP calculation which will include the benefit of intangibles, we wouldn't be surprised if the BEA and BLS push the country's entire economic reporting apparatus fully and entirely into wonderland,and absolutely every economic number is no longer accurate, relevant or unmanipulated.
Two years later, the BEA did indeed push the country's economic reporting aparatus into wonderland when it decided to "adjust away" winter weakness by double seasonally adjusting the GDP, thus making it the latest utterly meaningless data indicator..."

at http://www.zerohedge.com/news/2015-09-27/dear-janet-yellen-here-all-you-need-know-about-us-economy-true-unemployment-over-12

US On The Ropes: China To Join Russian Military In Syria While Iraq Strikes Intel Deal With Moscow, Tehran

"Last Thursday, we asked if China was set to join Russia and Iran in support of the Assad regime in Syria. 
Our interest was piqued when the pro-Assad Al-Masdar (citing an unnamed SAA “senior officer”), said Chinese “personnel and aerial assets” are set to arrive within weeks. To the uninitiated, this may seem to have come out of left field, so to speak. However, anyone who has followed the conflict and who knows a bit about the global balance of power is aware that Beijing has for some time expressed its support for Damascus, most notably by voting with Russia to veto a Security Council resolution that would have seen the conflict in Syria referred to the Hague. Here’s what China had to say at the May 22, 2014 meeting: 
For some time now, the Security Council has maintained unity and coordination on the question of Syria, thanks to efforts by Council members, including China, to accommodate the major concerns of all parties. At a time when seriously diverging views exist among the parties concerning the draft resolution, we believe that the Council should continue holding consultations, rather than forcing a vote on the draft resolution, in order to avoid undermining Council unity or obstructing coordination and cooperation on questions such as Syria and other major serious issues. Regrettably, China’s approach has not been taken on board; China therefore voted against the draft resolution.
In other words, China could see the writing on the wall and it, like Russia, was not pleased with where things seemed to be headed. A little more than a year later and Moscow has effectively called time on the strategy of using Sunni extremist groups to destabilize Assad and given what we know about Beijing’s efforts to project China’s growing military might, it wouldn’t exactly be surprising to see the PLA turn up at Latakia as well. 
Sure enough, Russian media now says that according to Russian Senator Igor Morozov, Beijing has decided to join the fight. Here’s Pravda (translated): 
According to the Russian Senator Igor Morozov, Beijing has taken decision to take part in combating IS and sent its vessels to the Syrian coast.

Igor Morozov, member of the Russian Federation Committee on International Affairs claimed about the beginning of the military operation by China against the IS terrorists. "It is known, that China has joined our military operation in Syria, the Chinese cruiser has already entered the Mediterranean, aircraft carrier follows it," Morozov said.

According to him, Iran may soon join the operation carried out by Russia against the IS terrorists, via Hezbollah. Thus, the Russian coalition in the region gains ground, and most reasonable step of the US would be to join it. Although the stance of Moscow and Washington on the ways of settlement of the Syrian conflict differs, nonetheless, low efficiency of the US coalition acts against terrorists is obvious. Islamists have just strengthened their positions.

As Leonid Krutakov told Pravda.Ru in an interview, the most serious conflict is currently taking place namely between China and the US. Moscow may support any party, the expert believes, and that is what will change the world order for many years.
Clearly, one has to consider the source here, but as noted above, if Beijing is indeed set to enter the fray, it would be entirely consistent with China's position on Syria and also with the PLA's desire to take a more assertive role in international affairs. 
Meanwhile, it now looks as though the very same Russian-Iran "nexus" that's playing spoiler in Syria is also set to take over the fight against ISIS in Iraq, as Baghdad has now struck a deal to officially share intelligence with Moscow and Tehran. Here's CNN:
Iraq says it has reached a deal to share intelligence with Russia, Iran and Syria in the fight against ISIS militants.

The announcement on Saturday from the Iraqi military cited "the increasing concern from Russia about thousands of Russian terrorists committing criminal acts within ISIS."

The news comes amid U.S. concerns about Russia's recent military buildup in Syria and would appear to confirm American suspicions of some kind of cooperation between Baghdad and Moscow..."

at  http://www.zerohedge.com/news/2015-09-27/us-ropes-china-join-russian-military-syria-while-iraq-strikes-intel-deal-moscow-tehr