The Euro has plummeted dropping to 12900 zone. Our Daily Bearish on the spot lies at 12940. Portugal interest rates have jumped to 8% and will move higher.Austria has closed 25% of all the branches of their bank in crisis, and we are waiting for the first crack in German banks. The EU Commission is waiting for the German Elections and will thereafter begin to look at issuing Euro-Bills to cover debts for the Union. But this is likely to be too little too late. Portugal is at great risk of just being forced into outright default and may be unable to wait for the German elections.

There is really little hope of saving Europe until we get a real sea-change in thinking. As long as the politicians continue to think they are in charge, nothing is safe. The cost of living in Europe is so high compared to America all for taxes, there can never be any job recovery in Europe. The euro simply must just sink further down until the politicians wake up or are forced out of office. In 2014, there will be major elections in Europe and that will be a large impact upon the future.

Meanwhile, the policies are just braindead. This is all about retaining power and control – nothing more. The standard of living is drastically lower. A Starbucks Lattie at $7.12 in Zurich, Athens $5.84, Frankfurt $5.53, Paris $5.18, Madrid $4.65, New York City at $4.30 and and $3.55 in San Francisco. This illustrates the taxation and how the cost of living is impacted by that development. The cost of dinner in Europe is often double that in the USA. So what exactly where has life been made better with unemployment among the youth at near 60%?

The Military coup in Egypt has people beginning to worry that the same will erupt in Turkey. We are seeing a backlash against religious governments.

July is shaping up as very interesting as we head into the turning point on the ECM of August 7th.

…..read Martin’s great commentary on the Civil Unrest brewing around the world, its causes and what history say’s is likely to happen in the next few years HERE

For some perspective on the long-term performance of the stock market, today’s chart presents the Dow priced in another global currency — gold. Today’s chart illustrates how it currently takes approximately 12.5 ounces of gold to ‘buy the Dow’ (i.e. the Dow / gold ratio) — well off the 44.8 ounces it took back at its peak in 1999. Priced in gold, the Dow had been in a massive 13-year bear market. However, back in the summer of 2011, gold peaked while the Dow continued to rally. While the Dow (priced in gold) is currently well-off its dot-com record highs, it has been on a tear as of late. The current rally has resulted in a break above resistance of its latest downtrend channel as well as new post-financial crisis highs.

Notes:
Where’s the Dow headed? The answer may surprise you. Find out right now with the exclusive & Barron’s recommended charts of Chart of the Day Plus.

10-yr bond price summary this morning: Italy -1.16%; Spain -1.61%; Greece -2.91%; Portugal -9.49%

• Greece’s government could soon be toppled as citizens there have had their full of cooperating with the European Union cast of characters “imposing austerity” upon them. Greece’s Golden Dawn party is rising fast and the feckless Greece leaders from the other major parties are starting to panic. Of course, Golden Dawn is another party being labeled “right wing extremists.” Maybe they are. I don’t know for sure. I do know we can’t believe the mainstream media about anything any longer. It seems every party that doesn’t fit the Brussels wine and crossiants mold, being built by real people who are sick of the rulling elite ramming the single currency regime down their throats, is labeled “right wing extremist.” Maybe its just me.

• French President Hollande is bashing Brussels. He is hammer hard on EC chief Jose Barroso, “vilifying him as fuel for the extreme right and has done nothing during his term in office,” according to the Financial Times. This is not supposed to be happening given France’s key role in holding the EU together. Don’t get me wrong, Borroso is yet another political disaster for free people everywhere (as are most US politicos), but it is likely much easier for Hollande to bash then to actually admit his socialists policies are destroying what is left of France; which is the much needed buffer against the German take-over of the Eurozone. And of course the “right wing extremist” party in France, led by Marine Le Pen is growing fast. [The elite in the European Parliament are so worried about the growing popularity of Ms. Le Pen, they recently stripped her of immunity under the guise that because she wants to limit Muslim immigration in France, it is similar to Nazi occupation in France. You could not make up this clap-trap if you tried. Just ask Mr. Edward Snowden if you don’t believe me.]

• Portugal yields are blowing out after its foreign minister resigned yesterday. The entire government could collapse. Let’s guess why. Could it be once again the same theme: the country’s economy is being crushed by the single currency regime and real people are sick of it. Stay tuned, another “right wing extremist” government is probably being built in Portugal.

EUR/USD Daily Chart

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Jack Crooks

Black Swan Capital

www.blackswantrading.com

info@blackswantrading.com

U.S. economic, military and foreign policy blunders make China’s global dominance appear entirely realistic, and for many observers inevitable.

Last week the Nicaraguan congress approved a $40 billion project for a Chinese company to build an Isthmian canal parallel to Panama’s. For those of us prone to peering anxiously into the future, this gave a disquieting advance picture of the new world of Chinese hegemony into which we are probably entering, whether we like it or not. As President Reagan famously remarked, Nicaragua is only two days’ drive from Harlingen, Texas. And presumably we can rely on China to cut that down a bit by improving the road!

Historically we must remember that the natural position of China is hegemony, though for several hundred years it only achieved that position by being deliberately geographically obtuse. Nevertheless, like ancient Egypt, for all but about 200 years of her history China has been militarily dominant over all powers it felt it had to deal with.

We should also remember that the high point of Chinese civilization was not the early Ming period of exploration by Admiral Zheng He under the Yongle emperor, but the apogee of the Song dynasty some three centuries earlier.

…..read more HERE

“The market is not an accommodating machine. It won’t provide high returns just because you need them.”

Peter Bernstein

“All Nations with a capitalist mode of production are seized periodically by a feverish attempt to make money without the mediation of the process of production.”

Karl Marx

“Inflation is the disease of money.”

In this piece, the Central Bank Revolution II – Chasing the Dragon, we illustrate how the effects of central bank monetary policy, today, have already distorted the term structure so monstrously that assets have been driven to yields more akin to those of holding money. The yield grab has extended into riskier and riskier assets and structures, resulting in a diminished return profile that is not compensated for by the falling credit quality, and the heightened duration risk. The stage has been set for capital losses, as once again investors indulge in levered products, with suspect collateral value, and invest in plain vanilla assets with no margin of safety.

…..read the report HERE