For Whom Da-Gong Tolls

As is customary after my medical exam, my doctor and I chit chat about the world situation. He asked me, "Do you think we will go to war with China". I answered saying that conflict may already be underway but I doubted that we would ever engage in a "shooting war".

To which he asked, "You mean an economic war?". I said, "No, monetary".

So to my dear Doctor C and all my faithful readers, I submit the following excerpt from the Dow Jones News service reporting on an interview my the Financial Times:

"Guan Jianzhong, head of China's biggest credit rating agency, blames his Western counterparts for the global financial crisis and says China, as the world's leading creditor nation, should have a greater say in how sovereign debt is rated.

Rating agencies such as Moody's Investors Service, Standard & Poor's and Fitch "are politicized and highly ideological and they do not adhere to objective standards," Guan, who is chairman of Dagong Global Credit Rating, said in an interview."

So here we have the Dagong show. And why not, if you were the largest creditor in the world, would you leave the task of credit rating to anyone else? Or better yet, do your own credit rating and don't tell anyone else-- leave the current puppets in place and threaten them with their very existence if they reveal true credit ratings to the anyone else.

First Installment on $20B Shakedown

So, on June 17, I let you folks know how the $20B shakedown of British Petroleum by the US Government was going to unfold. The first installment is for $7B and was announced today at the Apache Corporation website.

Go back and take a quick look at my June 17 posting: here.

Now, after checking out the Apache Corporation website link above notice 3 things:

1. The underwriters for this transaction are all US financial institutions that have been bailed out by the US Government because they are insolvent,
2. The lead is Goldman Sachs former employer of just about everybody who is anybody in the US Treasury or Federal Reserve,
3. Apache Coporation does not have $7B to execute the purchase for the assets they announced they are buying.

This is getting really easy to predict. I hope you are making money. If you are just reading my posts for your entertainment; I at least hope that you are amused.

Sell into the Summer Strength

When you visit here please remember you are getting the news about a year before it happens.

Remember my treatise of April '09 on the coming double bottom? It was hard to see then with the stock market roaring back after its March '09 lows. Even harder to see when we were all getting real "giddy" in December of '09. But here is comes.

This past April, I encouraged everyone to keep an eye on their country's bank statement. After all, it is your money.

Well, based on the June 30th report from the US Treasury, it looks like we might just tip over the country's legal debt limit before the November 2010 elections. Its a close call.

Also, on July 1, 2010, the Congress of the US decided that they are not going to publish a budget for fiscal year 2011 which starts in September 2010. Never before -- since the creation of the Congressional budget process -- has the House failed to pass a budget, failed to propose a budget, then deemed the non-existent budget as passed as a means to avoid a direct, recorded vote on a budget, but still allow Congress to spend taxpayer money.

Should be an interesting 2nd half of 2010:

• A new supreme court justice (life time appointment btw) that was never a judge,
• A war that cannot be won (war on terror),
• A problem that cannot be solved (climate change),
• Growing disregard for the "rule of law" by the government,
• Politicians who cannot lead without spending,
• $955B in stimulus spending that didn't stimulate ($168=Bush;$787=Obama),
• An ecological disaster (Gulf of Mexico oil spill) that will not be re mediated,
• A central bank (the Federal Reserve) which has exhausted all its monetary "tools",
• Banks that won't lend,
• Consumers who won't spend unless the government subsidizes the purchase (home buyer rebates, cash for clunkers programs, etc.),
• shall I go on?