NC Renegades

This “election” is nothing more than bread and circuses.

David DeGerolamo

10Y Treasury Yields are plunging back below 2.00% (lowest in 3 months), WTI crude front-month (March) has just tumbled to a $28 handle, and Dow futures are now down over 500 points from this morning’s exuberant stimulus hope highs…

Crude has collaped back below $29…

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Something has just happened that has signaled a recession every single time that it has occurred since World War I.  16 times since 1919 there have been at least 8 month-over-month declines in industrial production during the preceding 12 month period, and in each of those 16 instances the U.S. economy has plunged into recession.  Now that it has happened again, will the U.S. economy beat the odds and avoid a major economic downturn?  I certainly wouldn’t count on it.  As I have written about repeatedly, there are a whole host of other numbers that are screaming that a new recession is here, and global financial markets are crumbling.  It would take a miracle of epic proportions to pull us out of this tailspin, and yet there are many people out there that are absolutely convinced that it will happen.

John Hussman is not one of them.  In his most recent weekly comment, he examined this stunning correlation between month-over-month declines in industrial production and recessions.  To me, what Hussman has presented is overwhelmingly conclusive…

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by David Stockman

The robo-machines are now having a grand old time hazing the August lows at 1870 on the S&P, and may succeed in ginning up another dead-cat bounce or two. But this market is going down for the count owing to a perfect storm.

To wit, the global and US economies are heading into an extended deflationary recession; S&P earnings peaked at $106 per share more than a year ago and are already at $90, heading much lower; and the central banks of the world are out of dry powder after a 20-year binge of balance sheet expansion.

The latter is surely the most important of the three. It means there will be no printing press driven reflation of the financial markets this time around. And without more monetary juice it’s just a matter of time before a whole generation of punters and front-runners abandon the casino and head for the hills.

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Canada Set To Unleash Negative Rates As Oil Patch Dies, Depression Deepens

This Wednesday, the Bank of Canada has a decision to make.

Canada’s oil “dream” is dying thanks to the inexorable slide in crude prices and as the IEA made clear earlier today, the pain is set to persist for the foreseeable future as the world “drowns in oversupply.”

“Lower for longer” has hit the country’s oil patch hard. We’ve spent quite a bit of time documenting the plight of Alberta, where job cuts tied to crude’s slide have led directly to rising suicide rates, soaring property crime, and increased food bank usage (not to mention booming business for repo men).

Adding insult to injury for Canadians is the plunging loonie. Because the country imports most of its fresh fruits and vegetables, the weak currency has triggered a sharp increase in the price of many items in the grocery aisle as documented in a hilarious series of tweets by incredulous Canadian shoppers.

The question for the Bank of Canada is this: is the risk of an even weaker loonie worth taking if a rate cut has the potential to head off the myriad risks facing the economy?

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Although Canada is now in a depression, the rest of the world will soon use this same term for their economic collapses. While EBT cards have replaced soup kitchens, all good things eventually come to an end.

Got Faith?

David DeGerolamo

by Matt Bracken

My name is Naku. This is the story of my people, who live on the great Island of Plenty. Our island is so vast, and the need for travel so small, and it being very difficult to cross the high mountain ridges, people most often live near where they are born. Food is easy to grow or to pick everywhere and at all times of the year, and there are plenty of fish to catch as well. But from time to time a traveler might visit, sometimes by boat, and sometimes by climbing over the sharp-topped mountains between the numberless valleys. As you may suppose, because of the difficulty of distant traveling, news from afar does not travel quickly on the Island of Plenty.

But I did hear a few years earlier about some new people from the outside, people who had landed on the other side of our island, in the place we call Far Plenty. These new people were said to be very strange, and not so pleasant. They did some unusual praying at night, possibly to the moon. They were called the Alanok people, if the tales were truly reported. It was said that they had come from a very terrible island, an island full of war and hunger and catastrophe, and that they needed to find a new home where they could live in peace.

Now, on the Island of Plenty, we have two very important rules or laws that we must all always obey. The First Law of Plenty is that anybody can believe anything that they want to believe, or not believe anything they don’t want to believe, and that is okay, because all ideas are equal on the Island of Plenty. The Second Law of Plenty is that if you give kindness and plenty to other people, they should always give kindness and plenty to you in return. After all, it is the Island of Plenty, and the bounty should be shared. Why not? There is plenty for all. These Laws came from our distant ancestors, who once suffered wars and hunger, until they learned the Two Laws. Then, the Island of Plenty also became the island of peace and contentment.

So it is understandable that when the Alanok people escaped from a terrible place and first came to Far Plenty, that they should be warmly welcomed. The Alanoks had severe needs, and the people of Far Plenty possessed a great bounty to share with them. But, according to the rare visitors to our valleys, the Alanoks were rather strange, and unpleasant, and did something odd at night when the moon had risen.

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The governor of Montana has signed an executive order that will protect LGBT state employees from discrimination.

On Martin Luther King, Jr. Day, Gov. Steve Bullock announced at a press conference that it is time to “recommit to King’s values of compassion and equity” by prohibiting discrimination based on sexual orientation and gender identity.

The order expands prohibitions against discrimination to also include pregnancy and military service, reports the Associated Press.

The executive order goes into effect immediately, and will protect state workers, contractors, and subcontractors from discrimination in employment as well as provision of government services. It also calls for diversity programs designed to prevent harassment.

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What did MLK think about gay people?

Rev. Martin Luther King Jr. was writing an advice column in 1958 for Ebony magazine when he received an unusual letter.

“I am a boy,” an anonymous writer told King. “But I feel about boys the way I ought to feel about girls. I don’t want my parents to know about me. What can I do?”

In calm, pastoral tones, King told the boy that his problem wasn’t uncommon, but required “careful attention.”

“The type of feeling that you have toward boys is probably not an innate tendency, but something that has been culturally acquired,” King wrote. “You are already on the right road toward a solution, since you honestly recognize the problem and have a desire to solve it.”

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