Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-57329 Thu, 30 Jul 2015 22:17:36 GMT The U.S. Economy's Top Speed Has Probably Been Overestimated for Years - Bloomberg Business http://implode-explode.com/viewnews/2015-07-30_TheUSEconomysTopSpeedHasProbablyBeenOverestimatedforYearsBloombe.html Revisions to the U.S. gross domestic product since 2011 reinforce the shift to a slower era of economic growth and underscore the difficulties the Federal Reserve faces in gauging just when to inch interest rates away from the zero-lower bound. According to the Bureau of Economic Analysis, real GDP from 2011 to 2014 increased at an annual rate of 2 percent, a downgrade from the prior estimate of 2.3 percent.

More details in this article: U.S. believes no structural issues in GDP data construction (an Orwellian title if we've ever heard one). An excerpt:

The improvements to the seasonal adjustment for defense spending found an overstating of GDP growth in the third quarter from 2012 to 2014. Third-quarter growth in 2012 was revised down by 2 percentage points to a 0.5 percent rate, with defense spending accounting for a half a percentage point of the drop.

So basically all of the recent hulabaloo recently about how Q1 is being consistently underestimated has been completely dwarfed and rendered moot by how much Q2 and Q3 have been over-estimated... especially when it comes to counting the effect of defense spending. Who coulda known ???

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iehi-feed-57328 Thu, 30 Jul 2015 22:13:13 GMT Bill Gross says Fed recognizing zero percent rates causing harm to U.S. http://implode-explode.com/viewnews/2015-07-30_BillGrosssaysFedrecognizingzeropercentratescausingharmtoUS.html What was equally troubling, Gross said, is that because double-B and single-B rated and in some cases triple-C rated companies have been able to borrow at less than 5 percent, "a host of zombie and future zombie corporations now roam the real economy."...

Such rates, the BIS claims, "sap banks' interest margins...cause pervasive mispricing in financial markets...threaten the solvency of insurance companies and pension funds...and as a result test technical, economic, legal and even political boundaries," Gross said.

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iehi-feed-57326 Thu, 30 Jul 2015 13:34:59 GMT Fed Is Not Just Behind The Curve, It's Driving The Bus Over The Cliff | The Wall Street Examiner http://implode-explode.com/viewnews/2015-07-30_FedIsNotJustBehindTheCurveItsDrivingTheBusOverTheCliffTheWallStr.html iehi-feed-57325 Thu, 30 Jul 2015 13:19:46 GMT Tsipras calls Syriza party vote on bailout http://implode-explode.com/viewnews/2015-07-30_TsiprascallsSyrizapartyvoteonbailout.html iehi-feed-57324 Thu, 30 Jul 2015 13:14:31 GMT An Expert That Correctly Called The Last Two Stock Market Crashes Is Now Predicting Another One http://implode-explode.com/viewnews/2015-07-30_AnExpertThatCorrectlyCalledTheLastTwoStockMarketCrashesIsNowPred.html iehi-feed-57319 Wed, 29 Jul 2015 23:02:04 GMT Stocks End Higher After Fed Keeps Interest Rates Unchanged http://implode-explode.com/viewnews/2015-07-29_StocksEndHigherAfterFedKeepsInterestRatesUnchanged.html iehi-feed-57318 Wed, 29 Jul 2015 22:57:50 GMT US, EU May 'Give Up' Ukraine to Seek Russian Political Support http://implode-explode.com/viewnews/2015-07-29_USEUMayGiveUpUkrainetoSeekRussianPoliticalSupport.html iehi-feed-57317 Wed, 29 Jul 2015 22:55:38 GMT If Varoufakis Is Charged With Treason, Then Dijsselbloem Should Be As Well http://implode-explode.com/viewnews/2015-07-29_IfVaroufakisIsChargedWithTreasonThenDijsselbloemShouldBeAsWell.html iehi-feed-57316 Mon, 27 Jul 2015 19:02:22 GMT Poland in no rush to join the euro http://implode-explode.com/viewnews/2015-07-27_Polandinnorushtojointheeuro.html iehi-feed-57315 Mon, 27 Jul 2015 19:01:26 GMT Wolfgang Schäuble backs euro fiscal budget proposal http://implode-explode.com/viewnews/2015-07-27_WolfgangSchublebackseurofiscalbudgetproposal.html iehi-feed-57314 Mon, 27 Jul 2015 16:12:12 GMT The Italian Job Market Is So Bad That Workers Are Giving Up in Droves http://implode-explode.com/viewnews/2015-07-27_TheItalianJobMarketIsSoBadThatWorkersAreGivingUpinDroves.html ``For every 100 working Italians, there are 15 people seeking a job and another 20 willing to work but not actively searching, the highest level among the 28 EU countries, according to statistics agency Eurostat.

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The main reason pushing up the Italian number seems to be discouragement: After seeking and not finding work, many Italians lose hope of securing a decent occupation and retreat toward family tasks or activities in the informal economy

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"I got tired of looking for work and started turning to volunteer activities and politics with the Five Star Movement in the town where I live," said Lavinia Montanini, who tried in vain to get a job in the arts preservation area. "At the same time, since I didn't find a job, I decided to enroll again at university for an advanced degree." Some potential employers may have seen her as being overqualified.

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iehi-feed-57313 Mon, 27 Jul 2015 16:08:44 GMT French farmers block Spanish and German borders in foreign food protest http://implode-explode.com/viewnews/2015-07-27_FrenchfarmersblockSpanishandGermanbordersinforeignfoodprotest.html iehi-feed-57311 Mon, 27 Jul 2015 16:01:44 GMT There Is No Exit: Why China's Plunge Protection Is Here To Stay http://implode-explode.com/viewnews/2015-07-27_ThereIsNoExitWhyChinasPlungeProtectionIsHereToStay.html ... the unwind has probably just begun and as BofAML notes, "most leveraged positions may suffer from losses likely in Rmb trillions'' That is unless Beijing moves to "take on substantially all of the leverage." This harkens back to comments made on July 18 by Finance vice-minister Zhu Guangyao who noted that "the key is what step the financial regulator should take after the stock market is stabilised, including the withdrawal of the intervention methods."

... there really is no right answer here and indeed the PBoC may now be in a position that's become all too familiar for DM central banks. That is, an exit simply isn't possible.

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iehi-feed-57310 Mon, 27 Jul 2015 13:43:10 GMT China's market meddling could do more harm than good; Market Plunges Again http://implode-explode.com/viewnews/2015-07-27_ChinasmarketmeddlingcoulddomoreharmthangoodMarketPlungesAgain.html iehi-feed-57308 Sun, 26 Jul 2015 14:02:37 GMT Judge finds Chicago's changes to pension funds unconstitutional http://implode-explode.com/viewnews/2015-07-26_JudgefindsChicagoschangestopensionfundsunconstitutional.html Mayor Rahm Emanuel's administration said it will appeal a Cook County judge's decision Friday that ruled unconstitutional a state law reducing municipal worker pension benefits in exchange for a city guarantee to fix their underfunded retirement systems.

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Novak's ruling was not unexpected because of a decision in May by the Illinois Supreme Court on a similar pension case. The state's high court unanimously struck down a law changing state pensions, saying the Illinois Constitution's protection against "diminished or impaired" pension benefits for public workers and current retirees was absolute.

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iehi-feed-57307 Sun, 26 Jul 2015 13:58:28 GMT Why Greece's ritual humiliation won't kill off Europe's revolutionary Left http://implode-explode.com/viewnews/2015-07-26_WhyGreecesritualhumiliationwontkilloffEuropesrevolutionaryLeft.html It is the wildfire of political contagion that spooks Europe's federalists. Greece's humiliation, rather than cowing the revolutionary Left, is set to embolden the southern calls for mass debt relief and cease the enforcement of the euro's contractionary dogma.

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Podemos are in line to become the kingmakers come elections at the end of the year.

"Iglesias understands that you need to get into power to change things", says Miguel Otero of the Elcano Institute in Madrid.

"He knows you need to drop the dogmatic discourse of the old Left in favour of courting allies and seeking compromise."

This practical attitude to power makes the current crop of Europe's young leftists a departure from their intellectual forefathers in Europe's traditional Marxist and Communist parties.

"Syriza's hardliners have just dropped out now, but in Podemos, the ideologues, including one of the intellectual inspirations, have already left complaining the party has become too institutionalised already," says Otero.

Podemos are now ripe to form a coalition with Spain's traditional Socialist party (PSOE), revived by their own young, telegenic leader, Pedro Sanchez. The Socialists are currently neck and neck with the incumbent conservative Partido Popular party of prime minister Mariano Rajoy.

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iehi-feed-57306 Sun, 26 Jul 2015 13:52:26 GMT Gov't braces for talks with creditors amid upheaval in SYRIZA http://implode-explode.com/viewnews/2015-07-26_GovtbracesfortalkswithcreditorsamidupheavalinSYRIZA.html iehi-feed-57305 Sun, 26 Jul 2015 13:50:00 GMT Puerto Rico debt crisis: austerity for residents, but tax breaks for hedge funds http://implode-explode.com/viewnews/2015-07-26_PuertoRicodebtcrisisausterityforresidentsbuttaxbreaksforhedgefun.html In its search for solutions Puerto Rico has tried to rebrand itself as a tax haven for the super rich. Laws enacted in 2012 can exempt residents from tax on nearly all investment income, which with Puerto Rico's exemption from federal income tax makes the island especially attractive.

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"People think we pay no taxes, but you know if a company makes $10m, a 4% tax rate still means $400,000 by itself," Rill said. "And that has nothing to do with the regulation fees, relocation and other costs we pay."

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But experts say it's not clear whether the plan will create jobs and prompt investment -- or simply divide the haves and have nots.

"These folks are preying upon distressed economies to try to gain maximum amount of return," said Javier Valdés, core executive director of Latino advocacy group Make the Road New York. "They should not just continue to expect the same return on their investment. Everyone needs to take a cut."

By Valdés's count, more than 200 people joined him last week at a protest against the funds at one investor's home in the Hamptons. "The same politics cannot continue," Valdés said. "They need to come to the negotiating table and be more lenient."

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iehi-feed-57303 Sun, 26 Jul 2015 13:32:57 GMT Greece bailout negotiations facing delay, minister confirms http://implode-explode.com/viewnews/2015-07-26_Greecebailoutnegotiationsfacingdelayministerconfirms.html iehi-feed-57302 Sun, 26 Jul 2015 13:30:10 GMT Abenomics End Game: Thousands Protest In Downtown Tokyo, Demand Abe's Resignation As PM Disapproval Soars http://implode-explode.com/viewnews/2015-07-26_AbenomicsEndGameThousandsProtestInDowntownTokyoDemandAbesResigna.html