MONDAY 2/17/14; Presidents Day Holiday; US Markets Closed

Japan is hit with heavy snow fall in recent days which creates worry since the nuclear plants are shut down. The weak GDP is due to the weaker than expected lift in exports due to the weaker yen along with the big increase in LNG and other fuel deliveries to replace the lost nuke power. Chubu nuclear plant, directly in an active earthquake zone, applies for a restart. Japan continues to stifle any news flow concerning the ongoing Fukishima nuclear disaster. Japan is a country getting squeezed from many sides and may be the weak link about to break and collapse the global market and economic chain. Rakuten plummets -9% experiencing the worst sell off in over a decade. The luster is off the VoIP acquisition rose.

Three former Barclays employees are charged with conspiring to commit fraud over the ongoing Libor scandal. There are about one dozen folks involved in the currency fixing scandal thus far. Barclays trades -1.3%. GOOG buys Israeli start-up company Slicklogin, a security firm that is five months old and only became a company a couple months ago. The company has technology that emits a tone that a smartphone can identify and verify to add an extra level of security to computers. The Italy 10-year bond is 3.65% the lowest yield since early 2006. Folks are buying the paper and willing to hold the debt. Italy’s Renzi meets with President Napolitano and makes plans to form a coalition government. New elections will be needed in Italy to create legitimacy to the government. One party continuing to install new leaders on an ongoing basis is not a proper way to govern Italy and the instability hurts the economy.

The German 10-year yield is 1.69%. UK 10-year is 2.80%. Portugal 10-year yield 4.84% and Spain at 3.56%. A top official in Merkel’s new coalition government is told to leave and a crisis meeting will convene tomorrow. European markets trade flat. The euro sits at 1.37. Pound 1.6736. European officials say it would be difficult for Scotland to join the EU if it splits from the UK adding to the confusion over this ongoing riff. Interestingly, RBS is actually owned in majority by the UK. The NIKK finishes at +0.6% and SSEC at +0.9%. Copper and gold miners trade higher. Cyclical stocks perform well. An Ethiopian hijacker, the co-pilot, diverts a BA airplane to Geneva where he claims asylum.

During the Presidents Day holiday in the States, the republicans emphasize the anniversary of President Obama’s $800 billion QE1 stimulus package which was touted as the infamous ‘shovel-ready’ jobs program. The president admitted later that there were really no shovel ready-jobs. Less than 10% of the money went to infrastructure and only a small portion of that rebuilt bridges that are now falling apart all over the US. Instead the money went to teachers unions and other programs to simply keep idle people working resulting in a waste of money. The young folks now have another failed Keynesian policy to pay for in their future. Everyone likes the good side of capitalism when the living is easy but no one wants to allow the down side of capitalism to play out to flush the weak companies and create a stronger future economy. Therefore, capitalism does not exist and worse, the Keynesian policies pump the stock market higher to make the wealthy wealthier. The president goes golfing for the third consecutive day and resembles Roman leader Nero riding along in a golf cart.

The $1.6 billion Ivanpah Solar plant, the world’s largest solar project, in the Las Vegas desert begins operating. The technology works but the facility could only be built with government subsidies and actually generates electricity at about 2 to 3 times the cost of coal and natural gas. Birds are mistaking the 300K mirrors as a large lake and fly into the area only to be hit with a massive heat wave that has them dropping out of the sky like dead ducks. Environmentalists will ignore the loss of wildlife just as they do with the wind turbine blades killing bald eagles each week. Forced and manipulative actions such as government renewable subsidies to boost wind and solar projects and Keynesian money printing policies, always have unintended consequences. An asteroid the size of three football fields flies by the earth at a distance of about 2 million miles which is actually very close from a scientific perspective. 1-800-Flowers receives bad press as folks take to the internet to complain that emails and phone calls were not answered as sweethearts went without flowers for Valentine’s Day. The company blames the severe winter weather for a challenging few days.