Tag Archives: Brexit

The assumption of right

This happens, it happens almost every day and we all (including me) see that happen. My view was that oil prices would go up. It is a logic set to demand and supply, a basic principle. As OPEC cut production by 1.2 million barrels a day, we would have expected a rise, maybe not directly, but overall when you get less of a product, the prices rise. It is the basic foundation of commerce; shortage tends to drive prices up. Yet a Forbes article proves me wrong (at https://www.forbes.com/sites/gauravsharma/2018/12/10/opecs-output-cut-not-enough-to-provide-short-term-70-oil-price-floor/#668312a8d58d).

This is fine, I never proclaimed to have all the answers, yet it does seem odd that less oil still drops the price from $80 to $51 in one month, and the logic is gone at my end of the table, yet I also know that oil prices are a little more complex, so I took this moment to learn a little. Gaurav Sharma gives us: “oil price is not just a story of supply; it is also a story of demand“. That part makes sense, yet this part only gives rise to changes if demand dampens and dampens by a whole lot. We see that with: “It cannot be ignored that Eurozone growth continues to disappoint, global trade is decelerating and China’s slowdown is a visible fact, and not just a forecast. We haven’t even mentioned the words “trade wars” and a prospect of further U.S. interest rate hikes“. Yes, so far I am on board, yet does that dampen the need for oil to THAT degree? This is precisely the setting when we consider: “If anything OPEC’s move provides U.S. drillers with a further incentive to pump more, and they already are, having made America the world’s largest producer of crude oil.” This implies that the need is changing; America needs less as they become self-reliant more. This explains the setting in the short term, yet it also gives rise to other dilemmas. As the US is using its own stock to keep cheap oil, we also see the change in the dynamics. Less money in the treasury through cheap oil, more costs (and optionally more jobs mind you), yet the budget and shortages of America (like $21 trillion debt) now has another not so nice tail. The interest on 21 trillion can no longer be fuelled with fuel. With a downwards economy, the debt will rise a little faster and there will not be anything left for infrastructure. Now, in this case none of this is the fault of the US Administration, or the current administration to be a little more precise. There is a lot wrong as the Clinton administration left the nation with surplus. I am not ignoring that 9/11 changed the game, yet the Obama administration had a clear directive to do something and that was not done. We can argue whether they had the options or not, we know that the war on terror has had a long-lasting impact. And the downward fuel price does not help. Yet cheap fuel is good for all the non-petrochemical industries and the people requiring cheap oil for heating.

The writer also gives us: “As things stand, a sustainable $70 oil price doesn’t look certain at all for 2019“. OK, I can only support that for as long as the US can keep up with the reductions that OPEC and Russia implement, when that stops working prices will go up, just how fast is unknown. It depends on the current storage and demand and I am not certain that this will not bite in 2019. I cannot academically argue with Gaurav Sharma and his 20 years of experience. His point might be valid, yet the Economic Times gives us: “WTI is forming Doji candlestick pattern and also near its long term Fibonacci retracement. Both are positive signs for crude oil prices“, If this happens within the next two weeks, my predicted increase of 15% comes true. Yet how is that chance? Focussing on merely my point of view tends to be delusional, which is why I liked the view by Gaurav Sharma. He gave me something to think about. It is Mike Terwilliger, portfolio manager, at Resource Liquid Alternatives, in New York who gave us (last week): “It’s a stunning market backdrop where everything from the adjectives used by the Fed chairman to whom is appointed head of trade negotiations can roil the markets. While the macro backdrop remains firm, with strong earnings and historically low unemployment, sentiment is unquestionably vulnerable. That would, in my view, fit the definition of an opportunity – a disconnect between the underlying and perception.” (at https://economictimes.indiatimes.com/markets/stocks/news/us-wall-st-tumbles-growth-trade-unnerve-investors/articleshow/66946928.cms)

I have always considered and known about ‘the underlying‘ and or versus ‘perception‘, no mystery there, yet are there factors we see to forget about? Part we get from the Guardian (May 2018) when we were given: “Demand is expected to average 99.2mb/d this year.” I am adding the part where that demand is not going to diminish over at least part of 2019. Even as we see more and more drive towards sustainable energy, most players are still all about presenting and not completely in the realm of achieving, hence oil demand remains stable (as far as stable tends to be), in addition we need to look at the oil futures. S&P global (at https://www.spglobal.com/platts/en/market-insights/latest-news/oil/121018-crude-oil-futures-stable-to-higher-on-opec-production-cuts) gives us: “risk sentiment remained heightened after US Trade Representative Robert Lighthize Sunday said that he considers March 1 to be a hard deadline for a trade deal to be reached with China and that tariffs will be imposed otherwise“. So basically the futures are rolling towards the up side making me correct, yet as long as the US can keep up with demand and as long as we see this continue, oil will remain stable and not push beyond $60 per barrel in the short term. MatketWatch is actually more optimistic towards the consumers of fuel. With: “Oil futures fell Monday to settle at their lowest in about a week on growing concerns surrounding a slowdown in energy demand“.

Why do we care?

We care because the drop in demand as projected and given by several sources is also the economic indicator that not all is well. This is seen in several sources. Goldman Sachs, via CNBC gives us: “We expect the U.S. to slow down to less than 2 percent by the end of next year and as a result of that you could see the market getting quite scared“, yet would be an overly optimistic view. We saw last week that the US Economy gained 43,000 jobs less than last year giving us a much less optimistic view on that part of the equation. Apple is falling down, tension on the Economy (specifically the US economy) is on the rise, some might say sharply on the rise. In addition, the Financial Post gives us: “Wall Street ignored trouble signs for months. Now it sees risks everywhere Markets face stomach-churning swings as economic uncertainty grows“. Even when we stick to the headlines, it was nothing really breathtaking. The US trade deal with China, the growth fears in the EU, they all link into a negative setting of the economy. Not recession, yet a negative impact due to no growth (too little growth is more accurate) and the events in France do not help either. In addition, there is now a realistic chance that Italy is entering recession territory. Even as it is possible to avert it, it will means that the Italian economy will end at a standstill (which is not a recession), yet in all this, with the Two large EU economies at 0 (France and Italy), it falls to Germany to bring home the bacon and sausages, implying that they are all eager and desperate to sink any notion of Brexit as soon as possible. As we see the jesters giving us that the UK can exit Brexit, that whilst they are seemingly unable to get a handle on the ECB and their everlasting lack of transparency, so whilst we see (at https://www.euractiv.com/section/politics/news/ecb-chief-rejects-chance-to-adopt-eus-transparency-register/) the unsettling part “The European Central Bank’s President Mario Draghi has rejected calls from European lawmakers to have financiers who give advice and feedback to the ECB register as lobbyists, saying they merely provide “information”.” I merely see an extended reason to pursue Brexit stronger. I actually am in a state of mind to demand the right for targeted killing these so called ‘informers’, which is a massive overreaction, yet the need to get these information givers listed next to the lobbyists is becoming more and more essential. If any nepotism, or if any under the table deal is found within the EU, their exposure is essential. I believe that this will flush greed out into the open rather fast, but then I am merely one voice in all this.

It connects

You see, the QE is supposed to come to an end this Thursday, or at least the formal announcement to end it at the end of this month. However, when we consider Reuters: “the economy weakening, trade tensions darkening the outlook and headwinds still on the horizon in the shape of Italy and Brexit, financial markets are looking ahead to next year and just how the ECB will protect the bloc from a severe downturn“, not only does the rejection to officially end QE have an impact, it also means that suddenly demand for things like oil will suddenly spike, that means that reserves go down, oil prices go up and there the cost of living will impact harshly on Europe in winter and as such on American soil the need for a price hike will not really be one that people will cherish, and when we add to that the part that Germany also has a depressed economy to look forward to, we see the three great economic players all in a diminished form, implying that the economy will tank on the low side not merely in this year, it will have a depressed form of growth in 2019 as well. There will be all kinds of lessened good news, whilst the good news is not that great to begin with. It gives rise to the point that I might be wrong on the oil price as I expected it to grow by 15%, it might still go up yet not that much and it will come at a really high cost this time around.

Right or Wrong?

It does not matter in this case; the issues seen are openly visible and heralded throughout the net, magazines and newspapers. The issue of ‘the underlying‘ and or versus ‘perception‘ is at the heart of the matter. Even as energy and oil prices show certain paths in all of this, it does not make it a correct view (which is neither right not wrong), what we perceive in opposition to the underlying elements connected, that is the bigger picture of impact. It is also a new stage. As the politicians are fighting over the carcasses of opportunity and bonus structures, we see that Germany has a few other elements in play. It is not merely the manufacturing part of it all, it is infrastructure as well and that is where we get my earlier statement, a statement I gave 3 days ago in ‘Behind the facade‘ (at https://lawlordtobe.com/2018/12/08/behind-the-facade/), if Huawei (minus one arrested exec) shows their value in Germany with the given quote, which came well over a day after my article (at https://foreignpolicy.com/2018/12/09/germany-is-soft-on-chinese-spying/), where we see: “In the terms of reference published last week by the German Federal Network Agency for its 5G auction, security was not even included in the conditions for awarding the contract. In October, the government announced: “A concrete legal basis for the complete or partial exclusion of particular suppliers of 5G infrastructure in Germany does not exist and is not planned.”“, as well as “For Deutsche Telekom and other network operators, the situation is clear: Huawei offers innovative and reliable products at highly competitive prices. Legally, Deutsche Telekom does not bear any liability for the security risks associated with Huawei technology. And the company does not care about the fact that Huawei’s price advantage is the result of a highly skewed playing field in China. In the world’s largest market, domestic providers control 75 percent of the market, giving them unbeatable economies of scale“, we see the hidden trap that some people related to Mr S. Tupid are now in hot waters (optionally with the exception of Alex Younger). Not only have they not given any evidence regarding the security risk that Huawei is supposed to be. Foreign Policy also gives us: “Given the massive cybersecurity and national security risks, the only responsible decision is for Berlin to follow the Australian, New Zealand, and U.S. lead and ban Chinese providers from the German 5G network“, yet there is no evidence, that was always the problem and so far there is more and more indicators (especially in Australia) that the claim “In none of these three countries will domestic suppliers be the primary beneficiaries“, which I regard to be false, on paper it does not impact ‘primary beneficiaries’, but it does harshly (in Australia at least) negatively impacts the competitors of Telstra, which amounts to the same thing (TPG, Vodafone, Vodafail et al). And when we go back to my writing in ‘Behind the facade‘, where I give the reader: “You see, Huawei can afford to wait to some degree, as we see the perpetuated non truths of devices being pushed forward, the replacements better do a whole lot better and they are unlikely to do so. When we see another failure in 5G start and we see transgressions and those screaming that ‘Huawei’ was a danger, the moment they cannot prove it and their ‘friends’ give us a device that is malicious, the blowback will be enormous. There is already cause for concern if we go by CNBC. They give us a few points that show the additional fear that America has on Huawei“, when the intrusions are not proven and Huawei shows to be a strength for consumers and businesses, heads will roll, there will be a demand for blood by the people, which means that politicians will suddenly hide and become ‘on the principle of the matter‘ and transform their perspectives into in all kinds of lethargic versions of denial.

That too is impacting the economy, because those on track to start pushing out new innovations on 5G will have a clear advantage over the other players and that pushes for success even more, will it come to pass? I cannot tell as there are too many elements in motion and the policies now in place are off course under optional revised in the future as Annegret Kramp-Karrenbauer will replace Angela Merkel if her party is re-elected as the biggest one.

We are seeing a few versions in the assumption of right, and we need to realise that the assumption of right and speculative version of what will happen overlaps one another, but they are not the same thing. States of delusion tends to be an impacting factor. Am I delusional to think that big business gives away greed? Am I delusional to consider that Huawei is not a danger? If we go by ‘the underlying‘ and or versus ‘perception‘ I am correct. You see, would China endanger the true power of economy where Huawei would become the biggest brand on internet and 5G requirement, using it for espionage when there are dozens of other methods to get that data (including Facebook policies implemented by Mr S. Tupid and Mrs M. Oronic). As this sifting of data exists on many levels in several ways, not in the least that the overly abundance of TCP/IP layer 8 transgressions happening on a daily basis and at least twice on Sunday), when we realise that, why would any Chinese governmental (namely Chen Wenqing) endanger a Chinese technological powerhouse? The logic is absent in all this. This gives us the light of Alex Younger opposing the others. He gave a policy setting of national need, whilst the others merely voiced all this ‘national security‘ banter on risks that do not even exist yet. Especially when we saw the Australian version of: ”5G will carry communications we “rely on every day, from our health systems … to self-driving cars and through to the operation of our power and water supply.”” Perhaps anyone can tell me how many self-driving cars there are at present or within the next 10 years?

And none of these клоуны (or is that Sarmenti scurrae) considered the step to start with Huawei 5G and replace them at the earliest convenience whilst you work out the bugs of your currently incomplete 5G solutions, the few that are out there for now, a simple business decision that is at the heart of any daily event, including military ones. A nice example there is the ugliest dinghy in US history (aka the Zumwalt class) where we see: “Zumwalt-class destroyers are armed with 80 missiles in vertical-launch tubes and two 155-caliber long-range guns“, which is an awesome replacement from the previous version that was regarded as a Ammo less Gun edition, in the face of continuing budget shortfalls, personnel problems and of course the fact that the previous edition was $1 million per shell, for its smart (GPS) capability. The mere elements that some sources gave out that shooting straight was an ability it naturally acquired as well as the fact that a $440 million ship was not given the budget to get its unique, 155-millimeter-diameter cannon that can shoot GPS-guided shells as far as 60 miles the 600 rounds of ammo at a total cost of $600,000,000. And that is apart from the $10 billion the Navy spent on research and development for the class. So perhaps people still have questions why I considered this monstrosity to be regarded as a ‘sink on the spot‘ project. The fact that The Drive gave us a year ago: “the Navy has steadily hacked away at various requirements, stripping planned systems from the design, in no small part to try and control any further cost overruns and delays. Close-in protection, ballistic and air defense capabilities, and various other associated systems are no longer part of the base design, something The War Zone’s own Tyler Rogoway explained in detail in a past feature, leaving it with limited utility despite its size and cost” (and apart from some minor issue regarding stability and stealthablity which we shall ignore for now) in that light the entire 5G redeployment after the fact and the ability are acquired, tested and evaluated, at that point re-engineering away the advantage that Huawei had built, did that not make sense within 10 seconds?

It is common business practice in IT, and has been for over 2 decades, that is why ASUS and not IBM rules the lay of the desktop land nowadays. so getting even would not have been the dumbest idea either, but no, we see all kinds of unfounded accusations and that is where those people are most likely to lose and out in the sunlight, when they cannot prove that claim, that is when we see on how some elements will soon be disregarded. In this Huawei has a nice advantage in Germany and Saudi Arabia. When they prove the elements there, we will see a large driven technology shift and those making the claims at recent days better have their stories straight.

Yet again, I might be wrong, my assumption of right might get sunk on false premise and nepotism, I do recognise that this has happened before and will happen again.

The assumption of right is at times hindered on delusional thoughts, as well as the need that the other players are straight shooter, and that definitely applies to all politicians, does it not?

 

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War lines and Battle lines

We all know them, we all personally have them. Some are founded on the realism of professional life, In thee we see the person who works well with others, there is one that is off. You see, that person also wants the senior position you have been working towards and there are two paths trodden at the same time. Your opponent is working as hard as possible to be better and in that same stretch equally is working to make sure that you look worse. The acts are trivial, a little block here, a little delay there and it seems all friendly, it seems corporate, yet you know better, you know that this person is after your future goal. It is corporate politics. You both work towards pleasing the larger shark, you both work to get the amenities to gain favour and play whomever you can to end up being first. It is the corporate environment and we have accepted that for close to a quarter of a century, if not for longer.

It is seen everywhere and this same setting is now in a stage for the conservatives and Brexit as well. Here we see a growing list, a list that currently includes Suella Braverman, Shailesh Vara, Esther McVey, Dominic Raab, Jo Johnson (Boris Johnson cleverer brother), Guto Bebb and now Sam Gyimah. We could go on and point out on how the connections are with places like Goldman Sachs, but that is merely stupidity to the max, Brexit is much larger than that.

And the Guardian (at https://www.theguardian.com/politics/2018/nov/30/sam-gyimah-resigns-over-theresa-mays-brexit-deal) gives us oppositional goods we should not ignore. When we see the quote: “In these protracted negotiations, our interests will be repeatedly and permanently hammered by the EU27 for many years to come. Britain will end up worse off, transformed from rule makers into rule takers“. We see a partial and an absolute truth, we could argue that they are both partial, yet that is actually influenced by the economic powers like Goldman Sachs.

Britain will end up worse off‘, I never denied this. The issue is not the temporary ‘worse off’ part, because it is merely a temporary stage, the actual issue is the unaccountable acts by the ECB and people like Mario Draghi. Three trillion all pumped into a stage that was never going to work. That evidence has been clearly seen, yet the overspending goes on and on and on. Being a member of a group where simple book keeping and budgeting is lost again and again due to a two party political game (national party members versus EU party members) is costing the nations dearly and for the most they are all playing possum, it’s not a good thing believe me. The additional issue that all places (like Bloomberg) where we see: ‘Draghi Says ECB Still Expects Net Bond Buying to End in December‘, yet the operative word here is ‘Expects‘.

It is the larger problem in this. Even as the last month has set in we are not given that December is the end date, gives rise to the setting that they want to continue this bad plan. That and a few other parts give rise to walking away. I would personally add that unless nations get the right to targeted killing the heads of the ECB, both present and past (Mario Draghi is about to leave), we should not give any confirmation of talks in any direction. The taxpayers have been given the bills of the high, rich and mighty for too long. When this game collapses (and it will) Europe faces a civil war level of unrest and so they should. They key points in Bloomberg: “The end of new bond buying won’t mean the end of stimulus, Draghi said, in light of the reinvestment of maturing assets, guidance on interest rates and the 2.6 trillion euros ($3 trillion) of securities purchased by the ECB so far. Chief economist Peter Praet made the same point earlier on Monday” gives support to my view (as well as some consideration that we might have to resort to targeted killing at some point).

our interests will be repeatedly and permanently hammered by the EU27 for many years to come‘ the second part is the consequence of banks losing power and momentum, because 68 million consumers walking away will hit EVERY book there is and the banks and power players will become vindictive little children as their need and desire for Sex, Drugs and Rock & Roll can no longer be met. Salespeople in a growing economy walk around like the (Pea)cocks that they are, in a recession and shrinking economy the become blaming little bitches, just like every other corporation. I have seen it too often. Making deals they cannot hold and when the facts are laid out they go into the blame game throwing it on the others ability not to be able to communicate. Cash is king, bonus is sacred and the rest can get fucked. That is the world we created and the UK will get hit by it, yet there is also another part. You see, the quiet number two elements in that venue will see it as an opportunity to rise and people like Sam Gyimah know this, he was at Goldman Sachs long enough. For almost five years the UK and Scotland did not consider the power place they had to assist India to become much larger European players and as such get some of that cream. But some were too busy facilitating to Pfizer and not considering the position nearly every NHS in Europe has and the ability for India to become part of the solution here. I saw this opportunity as early as 2013, but the others were too busy looking into the mirror, considering which DJI logo would look better in their photo frame of a long term sustainable life of wealth. During those 5 years Wall Street has all been about setting the stage to build fortresses to protect IP to their wealth. It is the stage of Jonas Salk versus Pharmasset & Gilead Sciences. Jonas Silk walked away from a $34 trillion payout and saved the American people, as well as many millions all over the world. His action caused the eradication of polio, the other two have the solution to Hepetitis C and is set in value to well over $11 trillion, and these patents are still highly protected for another two decades. America only fights protectionism when it suits them, interesting, not?

There is a third part, a part we all (including me) seemingly ignored. The distinguishing of ‘rule makers to rule takers‘ is a path we need to consider, even as the EU gravy train is in full motion, we see that rule makers are only there in the stage of presentation, to keep asleep the masses. If that was not the case there would not have been an Italian Budget issue, but there is ad even as we see: “Rome could ultimately face a fine of up to 0.5 percent of economic output — or some €9 billion“, should we see it for what it is, a joke? The Italians will add the fine to the debt; they will do whatever they please and in that, Europeans are in a Europe where the rich and the ignoranusses do whatever they please. How is being part of that anything but a joke?

  • The unaccountable actions of the ECB
  • The unmanaged ability to keep budget within the EU
  • The lack of transparency in EU politicians (travel expenses anyone?)
  • The lack of long term thinking
  • The lack to innovate parts that need overhaul

The UK has failings there too, yet by themselves they can make amends over time, in this European Union there is no chance of that happening. So, as the UK pushes Brexit, there will be impact, there will be cost (it was never denied), yet as the UK improves its own standing, whilst the EU keeps on going spending trillion after trillion on ‘stimulus after stimulus‘, it is at that point where the flaccid economies (France and Italy) will impact the others and the ‘rise’ and bettered economies all over Europe to the smallest extend, will not undo the overspending to the much larger extend, we will see presented bettering, followed by managed bad news in that same fiscal year. The entire issue with Mario Draghi and the G30 bankers group is merely one visible example of many. If you think that there is no impact, guess again. How long until we learn what happened in the G20, only after it passed the consent of the G30? The Europeans are about to be diminished to empowered consumers versus disregarded collateral. Some went as far as the early 80’s to make statements in that direction, yet the 90’s was too enabling, only now, only as we see that the entire large corporation setting can no longer be maintained, now we see a much larger change and for all those players it is important to sink Brexit. A true independent monarchy is a danger, because whatever step forward the monarchy makes, the other path will have to take two steps back, and you tell me, when was the last time that banks were willing to do that? For that to succeed all European nations will have to be ‘reduced’ to rule takers, and who elected them exactly?

And right there, we see the final part that opposes the quote of Sam Gyimah. With: “It has become increasingly clear to me that the proposed deal is not in the British national interest, and that to vote for this deal is to set ourselves up for failure. We will be losing, not taking control of our national destiny“, you see, in this EU, the British National Interest is merely a presented one, a PowerPoint page in a stage where the EU parliamentarians and ECB dictate the stage without transparency. That part is seen in two headlines in the last month alone. The first is Bloomberg, giving us: ‘Draghi Defies EU Criticism in Attending Group of 30 Meeting‘, the second one is the Financial Times giving us: ‘EU bank stress tests should be redesigned, says watchdog head‘. The second one (at https://www.ft.com/content/868f2dfc-e842-11e8-8a85-04b8afea6ea3), also gives us: “The comments by Andrea Enria, who is set to become the eurozone’s top banking regulator, were made two weeks after the latest stress test results, which saw British lenders among the worst performers while Italian banks largely sailed through“. As we were treated to the Italian issues over the last month, with Reuters taking the Cheesecake with “Italy’s third-largest bank Banco BPM will discuss an up to 8.6 billion euro bad loan sale at a board meeting on Thursday, picking one or two bidders to continue talks with, three sources familiar with the matter said“, I would really like it if someone would have that conversation of applied logic with Andrea Enria in the near future, especially in light of certain facts openly available. When performance is weighted on the absence of bad loans, I reckon that we get numbers that make no sense at all, optionally making the European economy 0.2% better than it actually is. It could push Italy, France and optionally Spain form a positive to a negative economy, when two of the large four are negative, how much trouble is the EU actually in?

I have never trusted any group that demanded continued membership at any cost. If the EU was so great, people would not want to walk away and now we have two members one who is trying to leave and the second one (Italy) is seriously considering walking away. In all this the third player (France) is in a stage where a positive economy is not likely to come soon. Strike after strike is making that an almost dead certainty. I wonder what the numbers would have been if we had removed Greece (not withdrawing support from them though), as they had less adherence and more options to seek solutions, things might actually be less dire for the EU. The fact that once in never out is the standard gave (in my personal opinion) rise to politicians doing whatever they pleased no matter who got hit in the process.

There is one upside, those who have been placing battle lines are now out in the open, so we see a stage where we start identifying the opponents, the question becomes will there be actions, long winded speeches, or denial? Each has a separate disadvantage and none seemingly have advantages, that is also the impact of a ‘once in never out state called European Union’, for all the benefits are merely given in a memo, with bullet points and is redundant the moment that the next memo is released.

Did anyone realise that?

 

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Smite the analysts

It is time to change the game. It is time to do a lot more than merely claiming to do something about fake news. I never claimed to bring the news, I have merely been in the process of nitpicking it as much as possible and the Guardian got my feathers plenty ruffled this morning, so it is time for me to be a little speculative of the matter.

We love our idiot products at time; it is something to laugh at or something to make a joke about; for the most harmless fun. Yet today something snapped. It might have been the abuse that Theresa May has been receiving, it might have been watching some poor sod holding a ‘We’re poorer without EU‘ sign, whilst like me that person is unlikely to have any economic degrees.

So when I see: ‘Theresa May’s Brexit deal could cost UK £100bn over a decade‘ by Richard Partington (at https://www.theguardian.com/politics/2018/nov/26/theresa-mays-brexit-deal-could-cost-uk-100bn-over-a-decade).

I hereby make my first demand (do not worry, no one will listen anyway).

In regards to: ‘People’s Vote-commissioned study says loss is equivalent to annual output of Wales‘, I DEMAND a full disclosure of the names of the people involved as well as a clear documentation of all sources used. this includes the names of those in the ‘People’s vote’ those who commissioned the study, the price paid for the study, as well as the names of those who made that report (not just the three who wrote it), the data sources used as well as how the report was set to the data and its results. I expect to find a dozen flaws in the very least. In this case any arbitrary choice (which at times is perfectly valid), should be seen as a flaw, unless clearly stated as such.

It is time to hold these people up to the limelight exposing what the Guardian (and many other newspapers) are giving voice to as being ‘the facts’. I would like to go as far as prosecuting (to some extent) the makers of these loaded and dubious reports by banning those names from any governmental research for life! When that happens, we will get all kinds of excuses and well phrased words or denial. Yet, I feel that we have come to a point where these activities can no longer be tolerated. Not by any government and not by any organisation with political aspirations, or connections.

The reality here is that the UK will lose income, lost funds and lose options for the short term. This has always been known. We always knew that things would get a little worse. Yet NOONE is making any call on the waste of three trillion euro’s by the ECB on their Quantative Easing and the waste of now close to three trillion that the taxpayer has to pay back, whilst people like Mario Draghi walk away with a ton of money, a member of an elite banking group of 20 and no accountability to anyone. The media refused to hammer on the ECB on any of it and the lack of clarity and transparency that the ECB has. This happened in full view whilst they all had 50+ articles on the death of a journalist no one really cared about (aka Jamal Khashoggi).

My larger concern is seen in: “Garry Young, the director of macroeconomic modelling and forecasting at NIESR, said: “Leaving the EU will make it more costly for the UK to trade with a large market on our doorstep and inevitably will have economic costs.” The NIESR report found May’s deal would not be as damaging for the economy as Britain leaving the EU without an agreement, which would cost the economy about £140bn over the next 10 years.” From my personal point of view, these people are in it for themselves, most of them are. Even as I will immediately admit that this report looks actually valid and good, issues come forward to a degree that might not have been seen at the beginning of it all, yet the scrutiny after the report is also lacking making the issue larger. What some call ‘lucrative European contracts’, we see a lack of investigation on both sides of the isle in all this, because as a Brexiteer, I will never deny a Bremainer to voice their opinion, or their opposition to it all. It is the acceptance of democracy that demands it from within me. The UK has not really profited from the EU, merely large corporations have and that is actually the biggest issue with the entire EU at present. When we look at the 68 million consumers, many of them have not been able to afford any of it. The bulk of all of us are dependent on moments like Black Friday to get the hardware we normally cannot get. It is a known issue that the quality of life is still low all over the UK and in many other places. The only true beneficiaries of the entire EU setting are the large corporations. The local grocer sees no real benefit, whilst the large supermarkets have all these deductibles that for the larger extent benefit its board members, not the customers. People like Gary Young are eager to make mention of ”inevitably will have economic costs“, which is a truth; I and many realistic others do not deny it. Yet in equal measure we can move away from a multi trillion bond buying scheme that has done nothing for the people whilst making the banks fat and rich. Never before in the history of mankind did the banks and Wall Street have such a large hold on governments and its citizens and we sat down and let it happen. Brexit is for the UK the first step to undo that damage and it will take time, we all get that. So as we realise that the ECB failure, in part to unmanaged ‘freedoms’, lack of transparency and accountability has greatly impacted the UK, at that point will we realise that there is a weighted and loaded stage against all of us, in every EU nation. The second part in all this is what some call: ‘the EU gravy train’, I have made mention of it on a few occasions and the lack of actions in that regard is close to sickening. Even The Times gave us some time ago: “MEPs are clinging on to lavish, tax-free handouts for travel despite publicly pledging to repay them, according to an internal report by the European Parliament. They have kept an estimated €6million (£4 million) after promising before the 2004 elections not to claim the money. “They get exposed, promise to be modest and then keep riding the gravy train. It is appalling,” said Hans-Peter Martin, an Austrian MEP, who has led a campaign against abuse of expenses. The €60 million-a-year travel allowance system is so generous that many MEPs admit it amounts to legalised embezzlement of taxpayers’ money. MEPs are paid a first-class air fare for travel to the parliament, even if they use budget airlines. They make an average of £20,000 a year tax free“. We can agree that in that meantime something was done, yet how much was done? The taxpayers have to come up with 751 times £20,000, giving us a total of fifteen million pounds and that is only the travel item every year, one of a lot more items, so how much extra are these people getting? The simple fact that many of these issues have not been adjusted for over 12 years is a clear stage that the EU is the goose for exploiting extra income and benefits, something taxpayers never signed up for in the first place. Even now (8 weeks ago) we see: ‘Details of MEPs’ €4,416-a-month expenses to remain secret, court rules‘ (at https://www.theguardian.com/world/2018/sep/25/mep-expenses-eu-court-ruling) with in addition: “MEPs are also refunded first-class travel expenses and get a €313 daily allowance for hotel and living costs when working in Brussels and Strasbourg“, which in the most optional stage grants them an additional £60K each, adding fuel amounting to £46,562,000 to the tax payers fire. I think I have made my point, did I not?

When Brexit is done and we start seeing the impact, I predict it will be less than 2 years before the complaining starts, not from the UK, but from the other nations that now have to pay for the part that the UK will no longer be paying for and that is the ballgame here. When that happens, and it will we will see a rejuvenation by both France and Italy wanting to get out as fast as possible leaving merely Germany as the large economy to carry the weight of the EU and they will not be able to do this and it will all collapse. That is not a speculation; it is a certainty as I see it. It will only need one of those three to join the leave team and it will already fail. In light of all that is happening it seems to me that Italy is now the frontrunner before France, yet that might be what the horse lover calls a nose length photo finish. It was almost two weeks ago when French Marine Le Pen gives us almost the same view in the Daily Herald with: “French far-right leader Marine Le Pen is blaming the policies of the European Union for Britain’s exit from the bloc. “If the EU wasn’t what it is now, the United Kingdom would still have been a member of a structure that respects the nations, the people, that doesn’t impose migration polices and deals that have very heavy consequences on our industries and agriculture,” Le Pen said Friday at a news conference in the Bulgarian capital, Sofia.” It was for the most what pushed me into the Brexit field a few years ago; even as Mark Carney, Governor of the British Bank and his presentation in the House of Lords gave me reason to doubt that, the acts of stupidity by Mario Draghi and the ECB pushed me straight into the Brexit field, supporting Brexit. A situation that had been known for years, yet in light of 751 beneficiaries nothing was done to keep tabs on it and Brexit become a fact.

So as we accept the setting (via many sources) that Marine Le Pen is giving through “the EU wants to punish Britain by imposing “conditions that are unacceptable to a large majority of the people in the U.K. and to members of the British government.”“, we have seen several parts of that in the media. Is it not interesting how infantile the EU gets when you do not want to be a member? They threatened Greece to throw them out, whilst there was no legal option for the EU, and they demand the impossible from those wanting to leave. In that setting, who wants to remain a member? I would go with the speculation that the EU is for: ‘those who needs the power of exploitation‘.

It is getting worse

In this we look back at Greece. Some might remember the big boast that Greece made. I mentioned it in my blog: ‘They are still lying to us‘ (at https://lawlordtobe.com/2018/06/23/they-are-still-lying-to-us/), so when we were treated on June 23rd to ‘Greece ‘turning a page’ as Eurozone agrees deal to end financial crisis‘. Here Alexis Tsipras was happy to be quoted with: “Greece is once again becoming a normal country, regaining its political and financial independence”, we saw none of the EU reservations in a claim that was off by decades. I also commented in favour of the Greek opposition shown by Kostis Hatzidakis with: “The opposing party reacted to the credit buffer with ‘Kostis Hatzidakis said it reflected the lack of faith international creditors had in Athens’ ability to successfully return to capital markets.‘ And in this Kostis is right, the international markets have zero faith in their return, they rely on a small thing called mathematics and the clarity there is that the scales are not in the favour of the Greeks.” Now we see a mere four days ago ‘How Greece Is Scrambling to Save Its Banks — Again‘, the EU has become this short sighted, this convoluted in misrepresenting the facts to the people. So as we see: “Greece is scrambling to figure out how to save its banks — again. Burdened by bad loans that make up almost half of total lending, crippled banks remain one of the biggest hurdles to Greece’s economic recovery. There are even worries that the country may face yet another financial crisis if it can’t dislodge its lenders from their downward spiral. With bank shares tumbling, the government and the Bank of Greece are working on plans to help banks speed up efforts to shed soured loans” and this comes one day after: ‘EU: Greece has Not Implemented 16 Bailout Program Prerequisites‘, which we get from the Greek Reporter. We see: “The European Commission is urging Greece to proceed with 16 prerequisites that have to be completed by the end of the year, as agreed with creditors. The first report after the end of the bailout program in August that was released on Wednesday says that Greece is delaying to implement 16 important measures and reforms. Among them are the staffing of the independent public revenue authority, the repayment of overdue debts, the legislative framework for resolving the problem of non-performing loans and the development of the new primary health care system“, the article by Philip Chrysopoulos also gives us “Despite the fact that Greece’s 2019 budget meets the target of a primary surplus of 3.5 percent of GDP” will see a speculative setback (speculated by me) by close to 2% at the very least, in what will likely be a wave of managed bad news. The EU is now that useless and pushing down all the other European players. If only the EU legal setting had allowed for removing Greece from the Euro setting and EU economy settings in 2014, a lot of the issues (like Brexit) would never have been an issue. It is in my personal view greed driven EU stupidity that allowed for this. A blind faith in Status Quo that pushed the need of large corporations and that might become the downfall of the EU as a whole.

Do you still think that the EU is better for the EU economy? First Greece and now Italy are becoming the weights drowning the EU. Merely one hour ago, the BBC reported that: “Italy’s government says it will stick to its high-spending budget plans, setting up a potential stand-off with the European Union over its deficit.“, are you actually believing in fairy tales when you think that this will not hit back on the rest of the EU? Even as the Independent reported 13 hours ago: “The pound fell 0.19 per cent to €1.1284 off the back of reports that Italy is headed for a breakthrough with its budget, which would bring to an end weeks of wrangling between the EU and the Italian government.” we now get the reality that there was no breakthrough, we merely see more of the same and the impact of Italy is not immediately reversing and upping the pound against the Euro is it? In light of the revelation, the pound should be up by no less than 0.27 percent against the Euro (the gain and the 0.19 percent loss), we will not see that will we (or we will see it as late as possible so that the 0.27 percent can be largely minimalized. When you realise that the UK is getting unfairly hammered to this extent, would you want to be part of that group? And when (not if) the UK shows the improvements making the UK economy better, what excuses will the EU, ECB, IMF and Wall Street give the people of Britain?

To be part of any exploitative regime as the EU is starting to show it in a few ways. The evidence of this statement was shown by the Clean Clothes Campaign last June when we see (at https://cleanclothes.org/news/2018/06/11/complaint-lodged-against-the-european-commission-for-failing-to-uphold-fundamental-human-rights-in-trade-policy) ‘Complaint lodged against the European Commission for failing to uphold fundamental human rights in trade policy‘. Here we see: “Bangladesh has committed serious and systematic violations of fundamental workers’ rights. Conditions are unsafe for millions of workers in Bangladesh. Additionally, the labour laws of Bangladesh create significant obstacles to the exercise of the right to freedom of association, to organise and to bargain collectively. Further, the government has not effectively enforced even these flawed laws, and workers complaints to authorities are routinely ignored. Without bargaining power or legal recourse, workers have been forced to live in extreme poverty.” and when we realise that the lack of activities, naming and shaming those who are part of it all, whilst the EU remains inactive to a much larger extent, my case of large corporations being in charge of those acting in the EU parliament is close to well made, tailor made one could state. The lack of visibility given in the EU and the oversight on what is imported into the EU from Bangladesh is frightening. The Dutch CBS reported 3 weeks ago: “The average import price per vest exceeds 3 euros in 2018. With an import price of around 2 euros, vests manufactured in Bangladesh are considerably cheaper. Prices of vests from China (approx. 2.50 euros) are also lower than average, while vests from India were average-priced (around 5 euros) and those from Turkey more expensive than average (around 5 euros).” good luck trying to convince me that this is not about money and that there is a proper investigation into the Bangladesh situation. The fact that even China cannot match these prices is partially evidence enough. The fact that manufacture owners in Bangladesh are part of the 250% plus stage that we see with: “This is the largest quantity ever recorded and approximately 2.5 times more than in 1998“, the lack of questions by those gravy train people is just a little too weird and more questions are not coming forward. That is the European Union that its members seem to like and letting the UK out is also not an option. The analysts are merely the first circle we should go after (the first of several mind you). Any report that is not clearly documented with the names of all the people involved in this should immediately be disregarded and kept on record for prosecution and smiting afterwards (when those reports are proven to be incorrect) at that point I wonder how many studies we will get that are so overwhelmingly negative. And it is not merely the analysts. The names of the people commissioning for the report and the clear definition of the question that was asked will also be set to scrutiny. I wonder how many politicians and corporate figures will suddenly run for cover and darkness like a group of cockroaches.

Feel free to disagree or even oppose my view. Yet also remember, I merely want to see the names and all data on those so called ‘commissioned studies’. Is that such a bad question? When we are given the results, should we not wonder HOW they got there? Is that not a duty we all should have?

When we look at The National Institute of Economic and Social Research, we see a clear stage of names, Arno Hantzsche, Amit Kara and Garry Young (which is a proper thing, mindyou). We also see on page 7 and 8: “The Governor of the Bank of England estimated that by May 2018, UK household income was 4 per cent lower than it would otherwise have been as a consequence of the referendum (Carney, 2018): “one third of the 4 per cent shortfall in real wages reflects stronger-than-projected inflation, which is almost entirely accounted for by the referendum-related fall in sterling. The remainder reflects weaker-than-expected nominal wages, the majority of which can be accounted for by weaker-than-anticipated productivity growth“, which should not be disregarded.

Am I opposing my own view?

No, when you see the charts in that page, we see the UK not being in a good place. Yet considering ‘UK economic growth relative to other G7‘ and ‘UK inflation relative to other G7‘, the UK situation would not look great whilst this is staged up to 2018, and now we get the good part. The G7 are Canada, France, U.S, U.K, Germany, Japan and Italy. Now consider the Italian part dragging down due to the stupidity of their budget decision (which might be seen as their right). In addition the Greek issue will drag down the EU as a whole and the USA is in a trade war that will also impact the USA, all parts seemingly not taken into account and suddenly the UK already looks a lot better in all this. Now, we cannot completely fault the report called ‘The economic effects of the government’s proposed Brexit deal‘, yet there is already a non-negative impact for the UK (it is a stretch calling it a positive effect). In addition we see properly placed “We have assumed” in the proper places and only thrice, which is also a good thing and for the most utterly unavoidable. We also see in one place: ‘Sterling effective exchange rate (January 2005=100)‘, which is possibly merely arbitrary, from my personal view the fact that 2008 and 2016 have impacted it all might also be a stage where the UK had more hardship than before and as such the three stages should have been included. My final issue is on page 15; I do not doubt the numbers or the statement perse. Yet when we consider “Ramasamy and Yeung (2010) find that openness to trade benefits in particular FDI inflows to services sectors, much more than to manufacturing. Ebell and Warren (2016) survey the empirical literature and calculate that reverting to trade under trade arrangements similar to those between the EU and Norway would reduce FDI into the UK by 8–11 per cent, and by 11–23 per cent under a Switzerland-type relationship” that openness of trade also implies the open acceptance of the unacceptable ethical stage that Bangladesh is showing to be, we need to ask the tougher questions on EU inactions to the degrees currently seen. You see, when we accept one part, we need to accept that all these sweatshop articles are out of bounds. They are merely emotional banter pressed on those trying to meet budgets, there is no humanity left, we should not allow for that. In this way my statement is harsh, yet that is what the EU has become, a harsh proposer of status quo at the expense of whatever is coming next. If you do not agree, feel free to ban all Bangladesh T-shirts, leaving others with 215 million T-shirts to sell; was that example too direct?

Even when we accept the part of ‘how the deal affects uncertainty and confidence‘, which is a topic that will remain as there will always be uncertainty, the entire report is seemingly staged towards the bad side, whilst any improves economic marker from the second year onwards are basically ignored. We can argue that year one will have no upsides, yet the stage of no upsides in year two is lose to unimaginable. Apart from the ‘EU donation‘, which has been significant, the downturn of Italy and Greece that will no longer impact the UK is clearly escalating and France is basically scared shitless of that part. France is so scared as it is in a much worse position than Germany currently is, who will also feel that impact to some extent.

No matter how this plays, it is a mess that will test the reality of a lot of people. My largest concern is not how good or how bad things get, it is the fake revelations by speculative analysts that are the impact of a lot of things and the moment when we see the managed bad news after the fact, we will also see the weakness that has become the EU, in light of an already weak USA, this merely strengthens the need for a segretative community (read: nationalistic approach to national issues). It is the one part where I see eye to eye with Marine le Pen: “the policies of the European Union as well as the lack of transparency and non-accountability” are the biggest drivers in this entire sordid affair.

I wonder how draconian the changes will become when others realise how correct my view of the matter was. I am less likely to facing the fact that I was wrong, there is too much documentation pleading for my view, especially as the Wall Street Journal reported “Greece’s Eurobank Ergasias SA said it will acquire real-estate company Grivalia Properties REIC, boosting its capital and paving the way for the creation of a “bad bank” to help deplete its pile of nonperforming loans” a mere 5 hours ago. So when exactly did the people ever benefit from a bad bank solution? We saw that in 2013 with the Dutch SNS and Reaal setting. So as Brussels treated us to: “The costs to the Dutch taxpayer were still substantial, resulting in a deterioration of the budget balance (excessive deficit procedure definition) for 2013 with 0.6% and an increase in EMU debt of 1.6%“, we see Greece doing the same 5 years later. As we look at the quote: “In fact, since the nationalization the Dutch press has regularly published pieces that show how the commercial real estate has been mismanaged for a substantial time period. Did this go unnoticed by the regulator? Why did it not intervene?” We now get to unite that part with the overwhelming inaction of the EU and the unacceptable actions of the ECB, so this will be a much larger thing that Greece is printing on the rest of the EU then the people are currently aware of and the impact will be felt much larger, the fact that the bulk of the EU states cannot keep a proper budget merely makes mathers worse (not a typo, it means ‘reaper of hay’), and now I am in a state of moments uncontrollable deriving laughter.

The lack of visibility to several parts (an issue I cannot blame the media for in this case) is just incomprehensible. In part this is due because there are so many elements interacting, yet the fact that the issues are not visible is still a matter of great concern, and also an additional reason to push for Brexit.

 

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What’s in the room?

It is merely a reference to a modernised joke by the Groucho brothers. ‘Wow, is that a really large penis, or is there an elephant in the room?‘ This is the situation we face (and yes it was an elephant). The stage we see when we are confronted with: “The 240-year-old department store chain was valued at just £65m by the end of the day, after its shares fell by 21% amid reports that it was now being shunned by suppliers. It was the biggest one-day fall recorded by the retailer for more than a decade” (at https://www.theguardian.com/business/2018/nov/14/debenhams-shares-fall-by-21). There is a question forming in my mind, but I will refrain from voicing it for now. You see, we also see: “The sharp decline also came after very poor weekly sales figures released by John Lewis on Tuesday. The rival department store chain said fashion and home sales collapsed by more than 11% on 2017 levels last week“. This now leads us to the question ‘Hold on, Debenhams is impacted by the bad sales of a competitor?‘ and that is not the worst. John Lewis is doing the British thing and blaming the weather though ‘John Lewis blames weather for clothing and homeware slump‘ they are all in an ‘I am so upset mode‘ due to: “The poor clothing figures came despite the employee-owned chain’s recent investment in its womenswear ranges, including the 300-piece John Lewis & Partners collection“. Debenhams reported more bad news in the recent past and they are all signals and symptoms of another problem. Yet the issue of that problem is not the actual problem, it is actually seen through “The move comes just weeks after credit ratings agency Moody’s downgraded its long-term outlook for Debenhams and increased its “probability of default” rating, which assesses how likely it is that the company will be unable to pay some or all of its debts“. It is not Debenhams, it is Moody’s that is part of the problem and there should be some consideration whether we should look at orchestration here. From my personal view there are two elements. One is actually Debenhams; the other is Moody’s as well as the analysts that they have.

Painting the frame of an empty picture

To get that, we need to look at the larger picture and therefor look at the frame of it all. There are plenty of people who have a job, yet their living expenses are high, and in winter even higher. Now we get the more important part in all this, which is: ‘This is not news!’ And that revelation puts Moody’s in part of the frame. In this day and age, laces like Sydney and London, the cost of living is through the roof and people can only barely get by. In Sydney we also have Christmas coming and it is going to be summer here soon, so the Australian population is going with the Australian bikini (hat and panties), so women look even more amazing than ever before and the weather ensues that they are not cold, so no heating bill (optionally some air-conditioning expenses). In the UK it is the reversed and under these conditions KMart, Target and places alike are doing really nice, whilst places like John Lewis with their “300-piece John Lewis & Partners collection” will not get much traction until the boxing day sales when prices go down 30% or more, so any increased revenue expectations is close to insane in November (besides black Friday that is). Optionally December will be on par (at best), so there we see my reason for the suspicion of orchestration. More so when we see information like “Debenhams did not deny the reports, but a spokesman said: “Many suppliers don’t use credit insurance. Those that have used it historically are well aware of the current situation and work with retailers to manage things accordingly“. This now gives us two parts. The first is seen with: ‘Those that have used it historically are well aware of the current situation‘, so not only is it a known situation, it is known historically so making the 21% down an even larger no-no, because a predicted event is either calculated in, or it is a stage of orchestration as I personally see it. This implies that some players are overly confident in the previous cycle, whilst the known elements were already in place that this was highly unlikely to ever happen. This is an additional part in my personal suspicion of orchestration of the numbers and optionally by the numbers.

The other article on John Lewis (at https://www.theguardian.com/business/2018/nov/13/john-lewis-says-mild-weather-to-blame-for-clothing-sales-slump) gives us: “It was also a challenging week for homeware, which fell 11.2.% after a sluggish housing market hit demand for curtains and cushions. Technology fared better and, though sales were down by 2.8%, the department was bolstered by gadget launches such as the iPhone XR“, and at this point we see even more.

You see, when we see the household spend being down, why would anyone get curtains and cushions at their homeware, whilst they get a decent and much better deal at places like IKEA? That would have been my forecast and knowing that is also adamant to the stage where the previous estimation of certain vendors would have been too positive in advance, in addition, technology sales would have been overestimated if it was down, yet not as much by the iPhone XR, so that implies (from my point of view) that there was a clear overestimation in the first place, as well as an optional overestimation of the new iPhone which by the way is at least 17% too expensive from the get go. Knowing these elements and you can see them in your own personal environment the best, you know that most of you are a little more cautious because of upcoming Christmas, all that implies that the organisations like Moody’s have been loading their cannons for another reason, because the entire cost of living is out of whack and it seems that it can now be used for optional economic orchestration, which is a huge no-no in my books. In addition, we see this downfall whilst the Black Friday has not started yet, a black Friday that could impact sales extremely positive as some see Debenhams (optionally John Lewis too) as the place to be on such a day. Consider that last year (according to the Express) ‘Debenhams offered up to 70 percent off on certain goods. Calvin Klein clothes were discounted by 50 percent‘, so when we see that, can we expect that these places were shunned last month so that the people could buy a lot more bargains? When you know that there is a chance that articles will be priced sown by 70%, would you shop now, or wait for an optional 70% cheaper pair of jeans (and if the man is lucky, his girlfriend will stock up on lingerie on that day too). All elements that are close to given, so when we see a 21% downfall on given expectations, whilst we see that certain elements are not considered in the first place, it is my believe that there is a setting of orchestration, which can have far reaching effects, especially as certain players with openly pressuring anti-Brexit feelings should no longer be ever trusted, not as they are trying to sway people through fear mongering. That is a personal believe of mine and so far I have been proven correct in more than one way ad on more than one occasion.

Let’s be clear, we need places like Fitch and Moody’s, yet when we see that certain known factors are downplayed by  analysts and when we see that they are not held accountable in any way, we see a power vacuum, where people unelected and optionally non-qualified are setting a dangerous stage for corporations to be scrutinised on a few counts where there was a seemingly level of neglect on applied business intelligence, at what point will we see the open questions on how the curve was overly downgraded at a prearranged point? If Debenhams and John Lewis get to hit the ball out of the part on the coming weekend and we see overly good news on the week after, will we start asking the questions on how analysts are optionally intentionally fear mongering companies into some level of administration? My views are supported by Springboard. The Guardian gives us: “The most recent data from Springboard, which counts shopper numbers, showed high street footfall down 2% in October – the 11th consecutive month of decline. Its analysts suggested shoppers were waiting for Black Friday and other seasonal promotions“. When we see that view and we do see that there has been a drop and the drop can be explained in simple and logical ways, at that point we see that there is an urgent need for Moody’s to explain their actions and give us jerk-knee actions like lowering the forecast for well over a fifth of the value, whilst the known status for the UK has been that Christmas tends to be a decent time, especially as there is no Thanksgiving outside of the US (for the most).

It seems to me that analysts and credit agencies like Fitch and Moody’s are becoming the elephant in the room and their actions should be the beginning of a lot of questions, especially as there are still too much questions on how they were in denial for too long in the 2008 bank and housing issues. It seems that they have been given a pass for too long and it is time to address that, especially as the US has been deploying whatever they can to avert Brexit into a remain status, they do not like to lose their upgraded revenue at the exploitation of Europe any day soon and that has come under fire to a much larger degree, and it should be receiving a lot more scrutiny by all levels of media soon enough (actually,  they are already a year late on that too).

At some point serious people should address the elephant in the room. I am hereby voicing clearly that I might be completely wrong, yet I am asking questions, ready to be corrected. The facts are clearly shown that some actions are overly excessive, especially in light of certain parts shown out there, the Debenhams situation is not new, there are pressures and no one denies that, yet they are not new. There are clear indicators that this has been a longstanding issue, a longstanding status of consumers not having enough available to splurge in any real sense of the way, making the entire 21% drop questionable on many levels and we do not see the questions asked, more so the drop is just accepted as is, which is another issue as well. We can clearly ask John Lewis a certain amount of questions that link the words ‘sanity’ and ‘reasoning’ on their ‘300-piece John Lewis & Partners collection‘. When was that done? Was it ever done? When we see the mention of ‘The line, which will be available in sizes 8-20 and available at prices ranging from £10 for a cotton jersey tank to £250 for a cashmere coat‘, yet I see no information on where the mean, the median is and how many pieces are at the outliers of that 300 piece range, is that not an important part as well? You see if 45%-65% is between the lowest and the -1 median John Lewis really arranged for a good time for themselves, if more than 40% is higher than the mean, we see that their insight was poor, with the optional ‘utterly stupid’ label if 30% is between Median +1 and highest priced articles, especially in this economic climate. Did anyone look at that? I am asking, because I searched, but I did not find that information. I am willing to accept that I did not look everywhere and in the wrong places, but Google search is pretty good that way. So as that part is optionally missing, the question I had on analysts, forecasters and prognosticators is setting them in a not so good light, especially as this data would have been available pre-launch (consider that these catalogues needed months to be created and printed).

These are all elements that were available way ahead of a sudden drop in values. Now, in the case of John Lewis, there is a chance that the fashion was initially rejected (until Black Friday) but that too could have been accounted for ahead of time. This all gives additional value to the question: ‘What is in the room?‘ So what if it was not an elephant, but merely an overextended ego? How would we see the status that Moody’s, Fitch and others are giving certain UK retail downgrades ahead of the curve?

I wonder if we will see the questions come after Black Friday and in January 2019, but I am not getting my hopes up, not any day soon at present.

 

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EA Games is waking up

We agree that EA Games has had a rough time, there is the loot box gambling part, a part I am on the side of EA games and I do not agree with the findings on a few levels. Yet there is a side where EA Games needs to wake up fast. first the good parts, like Forbes in September (at https://www.forbes.com/sites/games/2018/09/13/nhl-19-review-the-good-the-bad-and-the-bottom-line). From my point of view NHL19 is the best NHL game they ever launched. They started really good at the launch of the PS2, then there was a really good version of the game in 20903 on the GameCube and after that it started to sizzle (as I see it). They were more asleep than awake and the NHL franchise fell behind and fell behind a fair bit. EA Games had a few more good moments. Madden NFL 2002 On the Xbox was surreal and amazing, but that too fell down a bit, most state to me that NFL19 is awesome on many levels and I might find it out for myself in the Christmas sales dumps (somewhere out there). I was never a soccer fan, so FIFA is not in the cards, but the reviews are good and I accept that, but this is not about that, it is about the flaws in NHL19 and there are a few. Most of them are around the cards that you have accumulated, there is an option missing and a few details going into space, all could have been avoided. I personally believe that all 19 games have the same flaws and that is such a shame.

Then there is the use of cards, in my case I ended with a free HUT silver card and I have absolutely no clue what it does. So EA Games is not informing the users on some of the cards, which basically amounts to deceptive conduct. In a stage where EA games cannot afford to get markers of deceptive conduct against them is not a good thing. I love it that you get a free pack of 4 every 8 hours, which is awesome. Yet that does not rack up a lot in all the things I found. The option of a decent CCG album would have been great, with the cards on the right (or left) and the other side a superimposed image of that card where you could read all the details, why is it not there (not the version that is there now and it is a little laughable)? The filtering in auctions and looking at your cards is awesome, yet the lack of certain elements would have made it better. The customisable main screen of NHL 19 is awesome, and the practice part is fantastic (the final deke is a nightmare), yet overall this addition will entice more new players to NHL, especially those who have a puck instead of a heart (like me), it’s fun to have one but it freaks out the cardiologist to no amount, which is additional fun to boot. Why not expand on Franchise mode? Perhaps I did something wrong, I found the beginning awesome as I got my favourite team (Caps), arena, logo and jerseys unlocked. Why not unlock more with each game you win, other caps jerseys? I think we can accept that these will be non-tradeable cards, most gamers will not care, consider all the teams, American, Canadian, Scandinavian and other team leagues in there, the amount of jerseys and logo’s to unlock, would it have been such a shame to add them as unlockable parts? Now, I get it that this does not apply to the players, yet you still have the option to get those in the free packs (up to three players a day). It adds to the replay power of the game, adding bang to the buck and value to the game. Overall NHL is a screaming success, yet the parts that I found have a 5-10 point negative impact, whilst that should not have been the case in the first place and I reckon that I would find the same failings in both NFL19 and FIFA19, so a failing thrice over, and then there are the auctions. It is great that the game gives a free pack every 8 hours and there is always a coin card with 100 coins or more. Having won more than one 1000 coin cards made me very happy, as it allowed me to get 20 arena’s and half a dozen jerseys in a mere three weeks, so this is all good. What is less it that there seems to be an auction bug. I have been the front runner more than once and feeling happy having won a few auctions as the auction ended with me having the highest bet, only to go to the menu finding my coins returned and no card, which feels like a total sham. I actually lost my money once, but not through the auction, that daily coin card just vanished. It was a mere 200 coins, so no biggie, but it feels a little sour for a few seconds.

The graphics are awesome on the PS4, the controls are for the most outstanding and actually feel intuitive (except for some dekes) and practice mode adds to the flavour of preparation, which makes you more and more in the winning state of mind. I feel that having to select the language every time I start the game is weird, but what the hell, so first the language, then selecting the game at the main screen, a part that could have been done better I guess. Forbes has a few additional parts, all worth consideration, and the quote “The balance between offense and defense is good. Poke checks aren’t out of control as they were in a previous version, but still, an effective way to stop an offensive player’s progress. I think this year’s game forces you to use all of your defensive tools more than others. The more tools you can command, the better you’ll be at the game, and that’s the way it should be“, is one I wholeheartedly agree with. In addition there should be mention that the soundtrack adds to the game in a way that must be noticed. or me the fun was that I didn’t know any of the songs, which is always nice, especially when you feel more in the mood to play hockey because of it. In the end, the scores varying from 80%-89% is decent, yet I personally believe that adding these few parts to the interface and adding the reward unlocks might have made this a 85%-94% game. When that realisation sets in, consider what FIFA and NFL are optionally missing out on, especially when you realise that some people will not consider a launch day game for any title scoring less than 90%, that racks up to a serious amount of cash.

As stated, NHL 19 is the best NHL game I have seen in many years and that is still a great victory to behold, especially to play it again just as my team won the Stanley cup for real, which after supporting them for almost 27 years is a real good feeling. Now, I just need to get them there in the Pro Career (which might be a taller order for me), yet I remain an eternal optimist.

You see, if Colonel general Igor Valentinovich Korobov can drop the ball in Salisbury to the extent that the ball has been dropped, I definitely could be a successful NHL goalie, preferably the Western division so that I do not have to go up against my own favourite team, do you think that the San Jose Sharks could use another goalie?

Oh, and I had initially planned on writing about the media BS that we are getting from AstraZeneca and Brexit, which especially in light of certain patent pains are a hoot, but I am still gathering materials, so that will take a few days.

 

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One economy crises a day

Yes, it is the Guardian that alerts us to: ‘World economy at risk of another financial crash, says IMF‘ (at https://www.theguardian.com/business/2018/oct/03/world-economy-at-risk-of-another-financial-crash-says-imf). So as we see: “Debt is above 2008 level and failure to reform banking system could trigger crisis“, we think that this is a small issue, but it is not, it is however not the real dangers, merely a larger factor. The quote “With global debt levels well above those at the time of the last crash in 2008, the risk remains that unregulated parts of the financial system could trigger a global panic, the Washington-based lender of last resort said” gets us a little closer to it all, yet it is the phrase ‘Washington-based lender of last resort’ that is a little more at the core of it all. This, or in a roundabout mention towards the US federal reserve is not the only part in this. It is the ECB with its quantative easing setting, now at 3.7 trillion, which in light of the Bloomberg article in 2017 (a year ago now) mentioning ‘Some ECB Members Identify 2.5 Trillion-Euro QE Limit‘ becomes a larger issue. With the US national debt at $21.5 trillion the ECB at an estimated €2.4 trillion bonds as per June ($2.7 trillion), we are going off the deep end soon enough. So as people were all in such a state that I was wrong, it would not happen again and that the economy is great. Consider that I warned about this danger several times between 2016 and the latest in May 2018 with ‘Milestones‘ (at https://lawlordtobe.com/2018/05/05/milestones/). Yet all the parties are stating that I was wrong, and several hours ago, the Guardian treats us to: “The growth of global banks such as JP Morgan and the Industrial and Commercial Bank of China to a scale beyond that seen in 2008, leading to fears that they remain “too big to fail”, also registers on the IMF’s radar“. Yes, ‘too big to fail’, or should that be ‘to big too fail‘?

So when we see Gordon Brown getting quoted with: “former UK Prime Minister Gordon Brown said last month that the world economy was “sleepwalking into a future crisis,” and risks were not being tackled now “we are in a leaderless world”“. I found his response slightly moronic as there is no leaderless world, there are merely elected officials who know that they are merely in temp positions and they are paving the way for really nice paid futures. There is a distinct difference there. And in that I am still modestly awaiting my honour degree from the London School of Economics, in a pinch one from the Wharton School of the University of Pennsylvania will do too.

So when we see both “Christine Lagarde was concerned that the total value of global debt, in both the public and private sectors, has rocketed by 60% in the decade since the financial crisis to reach an all-time high of $182tn“, as well as “the build-up made developing world governments and companies more vulnerable to higher US interest rates, which could trigger a flight of funds and destabilise their economies. “This should serve as a wake-up call,” she said“. My response will be: “No Christine, you are wrong! The entire setting of a wake-up call is already 3-4 years too late. You have been unable to nurture the ECB, keep governments awake to get spending under control and the fallout will be huge and the people get to pay for it all“. The one benefit is that too large a population will be going through two depressions wiping out all their savings soon enough and in that there is an actual chance of a new civil war that would spread all over Europe. At that point the life of any politician will be £0.02 at best, once that starts, there will be not merely a Brexit, it will herald the end of the EU and it will impact the US in a most disastrous path, not merely wiping economies out, there will be a lack of trust between the US and the EU that will surpass the distrust levels between the USA and CCCP at the height of the cold war. It will redraw global economic maps to the larger degree. That is also seen in the part when we recollect the June 23rd article called ‘They are still lying to us‘ (at https://lawlordtobe.com/2018/06/23/they-are-still-lying-to-us/). There we were treated to “Greece is once again becoming a normal country, regaining its political and financial independence“, remember that part? So how normal is that country as we are treated to ‘Greek Bank Stocks Tumble Amid Concerns Over Capital, Bad Loans’ by the Wall Street Journal a mere 8 hours ago? So when we see “Investors appear to have completely lost confidence in Greek banks,” economists at HSBC said in a research note. The four main banks— National Bank of Greece, Alpha Bank, Eurobank Ergasias and Piraeus Bank—recently submitted ambitious plans to rid themselves of more than half of their soured loans by 2021 to the banking-supervision unit of the European Central Bank, several bank officials said. Under the new plans, which the ECB is considering, the banks would commit themselves to reduce their nonperforming loans to 15%-21% of their total loans, compared with today’s levels of 40.7%-54.7%“. the article (at https://www.wsj.com/articles/greek-bank-stocks-tumble-amid-concerns-over-capital-bad-loans-1538584978) gives us a lot more, but it shows that the banks are trying to shed the bad loans in as creative ways as possible and in this the governments are as I personally see it part of the problem, they were never part of any solution and the people will get to pay for it all as they were treated last quarter to: “as elderly Greeks face losing up to €350 ($416) per month when new pension cuts are implemented as of Jan. 1, 2019“, I believe that as the Greek banks collapse to the larger degree, as the Greek banks are shedding over 50% of outstanding loans, their value would also collapse as will their prospects and the loss of confidence will only increase the pressures. All whilst payments will still be due and cannot be met as it is staged to be at present. So there is a chance that Greeks will lose 50% more than they are currently losing at present in the next quarter, so we will see that the Greeks will start the year in utter poverty and the rest of Europe is not far behind. The ECB with its badly conceived QE plan has achieved that, so when the people are given that danger and handed the loss of retirement funds, utter rage will not be far away after that.

It was one of the reasons why I kept close eyes on Salini Impregilo. Even as Europe is going proverbially down the drain Salini Impregilo has been making headway on a global scale, foremost in Saudi Arabia and as their projects are kicking off, the infrastructure needs for Saudi Arabia grow. Their needs for dash boarding, reporting and data analytics will rise over the next two years and will require more and more knowledge and infrastructure with any additional building they are assigned. The entire project of the King Abdullah Financial District (KAFD) drew it even further to the foreground, merely because the required concrete levels that can be delivered seem to be at 30%-40% of what is required soon enough. It is an opportunity for Saudi Arabia and the UAE, but also optionally for Egypt. All these shortages ignored for now, yet when we see the image from 2012 and what was required then, and we consider that Neom will require close to 15 times that, where will the concrete come from? And it is not merely the availability; it will be about the proper planning of resources. Even as Salini Impregilo is merely a larger player of several projects, they in the end all need their concrete and where will that come from? So at this rate I expect to see the delays making the forefront news from 2020 onwards. Even as some places are increasing as much as they can afford. I expect it to fall short by a larger degree soon enough and when we are introduced to the heart of the matter. Smart cities will need smart infrastructure and the wiring will be well over 20 times what the entire Boeing 787 Dreamliner fleet required and that is a lot. the skills, the training to get the amount of people fuelling this is short on every level as I see it, so as Europe collapses with the debt, Saudi Arabia gets the option to buy staff cheaply soon enough. No merely getting the knowledge they need. Yet the brain drain to that extent has never been seen before anywhere in the world and that is where the ECB will suddenly realise that the fuel required to fix any acts of stupidity in the last 10 years will no longer be available and at that point Wall Street will wake up getting to live the perfect nightmare. It is not merely that there will suddenly be a boost of economy because there is no unemployment, getting the people trained up will take decades, stopping economic growth right quick and for much too long.

And as other players open up the doors for a guaranteed decent lifestyle, the setting is changing. We see that in the European Pensions last July, a mere 2 months ago when we were given: “European pension schemes are becoming increasingly attracted to the high returns and diversification benefits offered by frontier markets” This is the setting of: ‘more developed than the least developing countries, but too small to be generally considered an emerging market‘, yet as the high returns are estimated, the risks are also higher and there seems to be the risk ‘risk premiums are more greatly affected by political, economic, and financial factors‘ that is seemingly ignored to a larger extent. We see that part when we consider both “MSCI Frontier Market Index is the most widely used benchmark for equities. However, even this is highly concentrated in certain markets and sectors – financial stocks make up 46 per cent and the top three countries make up 53 per cent“, as well as “Argentina, which makes up around 22 per cent of the index, and Vietnam, 15 per cent“. So, now consider that the very same Christine Lagarde treats us to: “The International Monetary Fund (IMF) has agreed to increase a lending package with Argentina by 7.1 billion US dollars (£5.3 billion), seeking to calm markets over the country’s ability to meet its debt amid growing economic turmoil” a mere week ago. Do you still think that I was kidding or merely trying to kick the dead donkey? I am not stating that this is the fault of Argentina. I am speculating that too many parts of Wall Street are banking on the failure of others and it opposes the setting of returns on those seeking success, in this setting the pensions will lose, optionally they will lose every time without fail and the people are left with an empty bag not worth the price of that empty bag. Do you think that people will sit down and accept that? No, they will be beyond furious and the setting of Johan de Witt and Cornelis de Witt blamed and lynched in The Hague, the rioters were never prosecuted. So, there will be enough motivation on more than one level. It is something for the current European politicians to keep in mind, because this could happen again and the setting that the people face over the next 10 years is a lot worse than the ones that the population faced then. At that point, when this starts, I truly hope that those politicians will have the option of a quick getaway out of Europe, because they will not know safety ever again in that place.

So whilst we see the distancing of politicians on all fields whilst trying to drench themselves in non-accountability, whilst they will try the path of ‘It was a miscommunication and we were given the wrong advice‘, the people will no longer accept that as the evening news. They will want their pound of flesh and a bucket of blood and the regard of the value of politicians at that point will have been degraded to zero, and their ‘post life’ Facebook profile image might optionally look similar to the painting of the brothers De Witt as it was in 1672. You might think that it is mere speculation and it is, yet the trigger is not my speculation, it is the message of economic crises after economic crises as the governments are not acting against the banks and the exploiters that hide behind ‘too big to fail‘. The people all over Europe, if not on a global setting as they are mistreated to overly optimistic futures that cannot be met and have not been met for over a decade, you see, if that was actually true debts would have been receding, would they not? The only ones that did that harshly were the Germans and they are indeed in a much better place. It is the difference between being popular and doing what needs to be done and in that Angela Merkel was not about being popular, yet now those Germans are in a much better place than most other nations. It is something for you to consider as you notice your pension is gone and you want to take it out on someone.

so whilst we consider the final line in the Guardian, which was: “Without a rise in investment economies remain vulnerable to financial stress“, we need to consider that the setting is not merely about ‘investment economies‘, it is about the setting where large corporations come in and use that setting to ‘invest’ whilst draining away the gained momentum, so the economy that once was in that stage has been drained and those momentum profits are relocated to other places where ever those boards of directors are fuelling their personal wealth accounts, leaving those nations in a post investment era that is now merely regarded as a consumer fuelled economy whilst those people never gained the better economic standing to spend the money fuelling it further.

A setting where the equilibrium of economics fails as there was never a state of balance, merely a stage of relocating available wealth and the frontier markets are no help, they are merely an optional stage not unlike the CDO issues of 2008, in my view a way to avoid taxation and move whatever they could to a non-reporting nation. Or as one source stated: “the smarter operators no longer use filthy lucre but instead employ modern financial devices such as Interest Rate Swaps (IRS) and Total Return Swaps (TRS) to evade tax“, a setting where some take a 4% loss to avoid 26% taxation, it still wins them 22% and many had to live of a bonus a lot more shallow then that and from a base amount massively smaller than the one moved away.

One crises a day, I wonder what the bad news we will get treated to next week.

#HappyWorldAnimalDay

 

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Witchcraft and/or Calculus

Well as Monday mornings go, this will be a day to try and make you giggle (actually not really). I have always been an advocate for science and common sense. I believe that there is great wisdom in applying science in most occassions, it is the easy path in defining truths. Yet, we cannot explain it all with science. We are all limited, it is a basic truth, it is what drives us forward. It also takes a while to get there scientifically, so from the Penydarren in 1804 to the Virgin Hyperloop in 2021 was not an easy trip. A little over two centuries and we have gone from 10 tonnes at 2.4 mph to 50 tonnes at 260 mph, we can see that there has been forward momentum. We all move forward, not all at the same speed, yet when we consider that I predicted on September 4th (at https://lawlordtobe.com/2018/09/04/democracy-is-dead/) after Reuters gave me the quote “Italian bond yields edged lower on Monday after Fitch left its credit rating unchanged at BBB, revising only its outlook to negative, though mixed news flow from senior ministers and manufacturing PMI data due later this morning could mean the rally is short-lived, analysts said“, to which I gave my personal view of “we need to focus on ‘manufacturing PMI data due later this morning‘ which gives me that the rating was done ‘just in time‘ to avoid having to lower it, which implies to me that it was not a reprieve, merely the application of time management to force an upped rating.

So as we move forward less than 3 weeks, we now see (Source: Forbes 2 days ago): “It is no surprise that Fitch has changed the outlook for Italy’s BBB credit rating to negative from stable“. It is not only ‘not a surprise’; it was clear three weeks ago that this was going to happen. The system was as I personally see it rigged, to give a false optimistic rating to a nation that did not deserve it. The question becomes: ‘Are we abandoning science for witchcraft? If that is true, then I would like to move the motion to make Rachel Riley the high priestess of all economic witches and warlocks on the planet!‘ You see if they abandon common sense, can that unruly mob get managed by someone intelligent and when we are on that setting, it better be a good looking one, so the number of optional choices dwindles down to …. one? And Rachel is her name!

What’s behind this?

You see, we have seen on how S&P played us in 2008 on a few sides and it took until 2015 until a ‘deal’ was struck and they got off with a $1.5 billion fine, so when I am stating that they got off whilst they were getting off, I might be more accurate than I am comfortable with. Moody’s got their load handed to them with a mere $864 million penalty. so whilst some sources (source: Huffington Post) give us that the The 2008 financial crisis cost the U.S. economy more than $22 trillion, we seem to forget the impact outside of it, the impact on Europe and how the overall quality of life returned to WW2 conditions (slight exaggeration),  and even as we see reported that the economy in in restoration, we all seem to forget that the quality of life compared to 20 years ago is still less then what is was in 1998 and in that setting we see Fitch play a managed setting of overly soft on some economies and delaying the downgrades by (what I personally see as) jumping the gun by hours, delaying the downgrade, so basically knowingly assisting in the selling of deflated bonds, that is how I personally see it.

So as we look back at the quote and we consider my view three weeks ago with: “This was done to stretch the game, not truly act on the reported value, if that was done the setting of ‘BBB’ could not have been maintained, it should have been dropped to ‘BBB-‘ (my speculated view). So whilst we think we are being told the truth, in my personal opinion, we are sold a bag of goods, because that is how the game is players and we are all being duped, just like in 2008” and we see again: “Fitch has changed the outlook for Italy’s BBB credit rating to negative from stable“, whilst I do not even have an economic degree, can we agree that if it was this obvious, we need to start doing something about Fitch and these like-minded credit rating parties?

In all this the bad news is nowhere near done. the Financial Times (at https://www.ft.com/content/f9fb99d0-bf23-11e8-95b1-d36dfef1b89a) gave us a mere 7 hours ago: “Italy’s technocratic finance minister Giovanni Tria is coming under renewed pressure to increase the country’s budget deficit to accommodate the expensive election promises of Rome’s populist coalition government“, we can understand that it happens. We get it that promises need to be kept and some spending can never be avoided. Yet at 132% of GDP, with a National debt of €2.3 trillion, one would consider that caution would not be the worst idea. In this, sources are treating us to: “a guaranteed universal income of €780 month for all unemployed Italians“, which in light of the cost of living is a decent idea, yet the fact that around 10.7% of the Italians are without a job, the pressure on government spending goes up and up and that means that the deficit increases and with the interests and budget issues in play, the setting of ‘BBB-‘ might have been a little overoptimistic in the end and the news is not getting better any day soon in Italy. Even as we see that the jobless rate is at a low point (lowest since 2012), poverty was up to 14%, so that number will go down, yet at the cost of the Italian governmental coffers. I get it, it is good if they can find any way to get poverty down, yet they need more, they need an actual economy and the EU is playing around in all the ponds, but they are not getting anything done here and the 3 trillion euro spending bill still needs to be paid for one way or another, so there is are long term pressures to deal with from that side as well.

In opposition

When we look in one way, we need to look in another direction as well. So as we accept the orchestration side, we need to disprove it as well (good luck with that). Yet I did look in other directions, I needed as much data as needed, and when we consider my part to downgrade on September 4th and Fitch to keep it stable (at that point) that whilst Bloomberg gave us on September 6thItalian Banks’ Outlook Cut by Fitch Amid Political Concerns‘ (at https://www.bloomberg.com/news/articles/2018-09-05/italy-banks-ratings-outlook-cut-by-fitch-amid-political-concerns) with the quote: “UniCredit SpA and Intesa Sanpaolo SpA were among five Italian banks that Fitch Ratings said could have their credit ratings cut along with that of the state, should the nation’s populist government relax its predecessor’s fiscal discipline“. This is merely one of the quotes and it was clearly stated as a warning which is fair, yet we also see there: “Last week, Fitch said there was an increased chance that Italy’s government will reverse some previous structural reforms, negatively impacting the country’s credit fundamentals. It also said the relatively high degree of political uncertainty compounds the risk“, so not only was there already the prospect of negativity before the government non-reforms. There was in addition the political uncertainty. So there were already two markers staging the negative twist before the setting to ‘stable’ and the non-change was (as I personally see it) falsely given. There is also the part (which was after the stable setting) the quote “While the banks’ shares were little changed, Wednesday, they have underperformed the national stock benchmark this year, with UniCredit and Intesa both down about 15 percent. While UniCredit is more geographically diversified than the other four banks, its risk profile remains highly correlated with that of Italy“. It is another negative impact, yet the downgrade would not impact Italy for another three weeks, is that not a little too strange for comfort?

I would in addition mention the quote: “Fitch said it believes that a disorderly Brexit (UK exiting from European Union) could significantly disrupt Jaguar Land Rover’s supply chain and affect the company’s earnings and cash generation. It affirmed the long-term issuer default rating of Tata Motors’ at ‘BB+’“, so it had no issues changing the forecast ahead of schedule here, whilst Italy was given an additional 3 weeks of easy does it options. And there are no questions here?

We can accept that there are timelines and that things are done at specific moments. No one will deny that, yet knowingly (according to all the sources) to set the stage whilst the stage was unrealistic is an issue and it seems that there is a need to consider that the Three rating agencies are American companies. In all this, when we consider the past US behaviour, and the fact that there is no call to get at least one rating company added that is either UK or European based is a matter for discussion as well.

From ratings to fashion

Yet it is not all about the rating company. To see the stage I need to take one leap to the far left (or far right depending on what side you are facing). The view was encouraged when we look at the Times 2 days ago. Especially with my lack of insight, is good to take that setting to the forefront. The times started with ‘Brokers can’t wait for Burberry’s success‘ (which could be read in more than one way), yet the text gives us clearly “Burberry left visitors to London Fashion Week in no doubt of the scale of its self-confidence: “Kingdom” was the grandiose title granted to the highly anticipated debut collection of Riccardo Tisci, its new creative director“, with the added “Analysts renewed their attack on the £8.2 billion company yesterday after executives indicated that it could take three seasons for changes to provide sales with a significant boost. Credit Suisse downgraded Burberry from “outperform” to “neutral,” citing a lack of potentially stock-boosting factors on the horizon.

Now, I am not debating the reality of the setting. Yet when we look at a place like Statista (at https://www.statista.com/statistics/263885/burberrys-worldwide-revenue/), we see that even as they are not reaching new heights, we see that they are still doing decently well (if one calls £2.73 billion revenue decent) and the year is not over yet. So yes, we do accept that revenue and profit are two very different types of cake and one must eat ones cake, doesn’t one? That was given to us by the independent last year in November, when they gave us: “adjusted operating profit soared 28 per cent to £185m from £144m a year earlier“, we do not know the profits for this year as the year is not done yet. Even if the profits are optionally lessened, it comes from a 28% high, as we see that, what exactly drives the attack on Burberry and how does it relate to the earlier non fashionable one (even though they have Ferrari, Maserati and of course the Ducati), they also have some fashionable brands and they might not be of the Burberry level, the ladies will still love the Italian stuff. When we consider ‘Analysts renewed their attack‘, it is my personal belief that there is a group of insiders in these places who seem to be pushing the planchette of the Ouija board on where they need it to be (optionally not in line where it realistically could be), which is clearly a foundation of orchestration. The problem is not merely on how it is done, the entire financial setting is one of close to zero transparency as analysts ‘hide’ behind their formula’s (read: magic spells) and refuse to give out the incantation that they are using. Now, that is partially fair enough, most magicians do not reveal their tricks, they did do that in ‘Deception‘, which is optionally why it got cancelled after one season. I touched on the subject before and it remains active because a lot of ratings do not seem to make sense, especially when you see the actions and the fact that in May Burberry did beat their forecast with 2%, and still they are under attack? The interesting part is that the media who should ask a lot more questions are not doing that, not even reporting on it and whilst we accept the Guardian giving us two months ago that sales were waning ever so slightly, we were also given “Instead, they have been shopping in Hong Kong, South Korea, Japan and mainland China, boosting Burberry’s sales in Asia Pacific by a mid-single-digit percentage“, as well as “Sales in the Americas grew by a high single-digit percentage as the improving US economy encouraged more consumers to buy Burberry products“. In this we could accept that analysts might decide to warn caution, the message of ‘attack’ seems too unwarranted at present, especially when it is preceding Christmas and optionally the impact of thanksgiving sales in the US. Yet is all this, we see to pussy foot around the clear dangers that the Italian markets are giving us?

In this, we need to consider that if it is all around science we need to see a lot more clarity and if they want to sell the magic like we saw last week, we might (or not) accept to some degree the dangers that Mark Carney points out. the Business Insider gave us: “Bank of England Governor Mark Carney has privately warned the UK government that a “no deal” Brexit could bring about a housing market crash and a surge in the UK’s unemployment rate, according to several reports“, this makes perfect sense. Even as I have not seen the data, there are companies overreacting and threatening that they would vacate the UK. Some will do that, it is unavoidable. There was always the premise that this would also stop new hires and there would be fewer jobs for a little while. That too makes sense. Now consider that commercial building in London is through the roof and even now we see that things are not great. They have not been great since January 2018 when the Guardian gave us: “Developers have 420 towers in pipeline despite up to 15,000 high-end flats still on the market“, so in all this there is a larger danger and we were given this in April this year with “number of empty homes in London now above 20,000”, all houses well above £1 million that for the most no one can afford. So as houses remain empty, what do you think happens to the commercial places being build? We focus on the Battersea Powerhouse and Apple new stomping grounds, whilst we need to realise that 99% of all businesses are SME’s totalling at 5.7 million of them. Where do you think they will go when houses remain empty? I am not sure that Mark Carney is wrong, he might be a little too negative, but it depends on that data he has (and the question that he was required to answer), which is going to be loads better than the data I have seen. So when we get back to the setting of politics, if given the choice by the optional ‘troll like’ person Jacob Rees-Mogg stating “Bank of England governor Mark Carney is a “wailing banshee” whose warnings about Brexit cannot be taken seriously” versus the ‘goddess’ Rachel Riley who might be known for her ‘Would you like a vowel or a consonant?‘, is no less of a math goddess, implying that the math will add up correctly is she ever replaces Mark Carney, whilst the math quality is already in doubt ahead of schedule in the peculiar case of Jacob Rees-Mogg.

It is important that we take a much deeper look at the math and even as I have great confidence in Mark Carney’s ability to do the math, we also need to consider that he has a job, a job to properly inform the government, especially when the worst case scenarios can be as dire as they would optionally be for the short term. So whilst we see the mention of “Mark Carney is a “wailing banshee” whose warnings about Brexit cannot be taken seriously“, we also see that at present 20,000 houses are not sold and some have been on the market for well over 6 months. I would suggest that JRM gives us his math and back those numbers up on a public place for everyone to scrutinise (hopefully by Rachel Riley).

The issues matter and they connect to each other, the scrutinisers seem to preload the stage in ‘their’ favour, which is understandable, yet the cold calculation formula has kept from us, so we cannot see which factors have been set on a sandwich that had been buttered too heavily; we all have a right to know those facts, do we not? In the end we accept that it is not merely about apples versus oranges and it is not about the amount of fruit we have, it is about the different scales and the setting of a stage where transparency seems to be always missing and that approach is never scrutinised giving us a growing lack of confidence as well as a level of growing mistrust in those ‘reporting’ the result; an issue that has been clearly noticed by many, and was addressed for the most by no one at all.

If you want to try magic with a money charm using green yarn and pine oil whilst chanting:

Knot of one, the spell’s begun
Knot of two, I make it true
Knot of three, prosperity
Knot of four, bring me more
Knot of five, the spell’s alive

If that does not work, try calculus and focus on spending less then you earn. Try 6 weeks of one and half a dozen weeks of the other and see which of the two gave you better results.

Have a great Monday!

 

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