Daily Digest 10/11 - IMF Cuts Canada's Outlook, Fed's Sole Purpose Is "Keeping Banks Afloat"

Economy

Mysterious Algorithm Was 4% of Trading Activity Last Week (Dana T.)

My guess is that the algo was testing the market, as high-frequency frequently does,” says Jon Najarian, co-founder of TradeMonster.com. “As soon as they add bandwidth, the HFT crowd sees how quickly they can top out to create latency.”

Chris Martenson on what job numbers, the Fed, and a drop in oil prices are hiding (Arthur Robey)

We talk to Chris Martenson, author of "The Crash Course." Among other things, we ask how he thinks the issue of credit expansion is compounded by global energy resource depletion and population growth. Is the credit bubble is re-inflating or are we past the deflationary point of no return? And unemployment dipped to 7.8 per cent, with the largest gain in almost a decade. However most were involuntary, part-time positions. We talk about what the numbers really mean and how to factor in exponential population growth as an unaccounted for headwind to employment going forward.

Red Cross to make Spain appeal as economic crisis bites (westcoastjan)

The Spanish Red Cross is one of the country's most-recognised charities, previously best known for making public appeals for disaster-hit and poverty-stricken countries, the BBC's Madrid correspondent Tom Burridge reports.

It is warning of rising levels of inequality, which could lead to social unrest.

IMF cuts Canada's outlook, frets over housing, consumer debt (westcoastjan)

The Canadian government has already moved several times to tame the mortgage market and take the froth off house prices. The latest move by Finance Minister Jim Flaherty, in July, has helped cool the market, and most, though not all, observers, now see a soft landing.

Mr. Flaherty moved amid record high levels of debt to disposable income.

Developing Breakdown (pinecarr)

Dmitri Orlov on the developing economic breakdown.

NWO:The Enemy of Humanity (Amanda)

This American street muralist recorded a stop-motion video of his London creation of a mural depicting world leaders playing Monopoly on the backs of the working class. Pretty remarkable.

The artist goes by Mear One.

Peter Schiff: The Real Fiscal Cliff Is Much Bigger Than You Think (David B.)

They predict the U.S. will continue its tepid growth rate of near 2% if the fiscal cliff is averted. On the flip side, if we go over the cliff, the IMF predicts the automatic spending cuts and tax hikes due to set in at year-end would take more than 4% out of the GDP rate for 2013, tipping us back into recession.

Feedback Loops: HFT, Black-Scholes, and Cicadas (adam)

Feedback loops in the real world use control strategies based upon mathematical algorithms derived by time based differential equations (integrals and derivatives). To avoid confusion, note the dual use of the word "derivative" in the mathematical sense, and as a financial product "V" discussed as follows in the Black-Scholes (B-S) equation.

Guest Post: "The Fed's Sole Purpose: Keeping The Banks Afloat" - G. Edward Griffin (westcoastjan)

In this explosive video, Casey Summit speaker G. Edward Griffin, author of The Creature from Jekyll Island, talks about the Fed's real role in the US economy and why – contrary to common belief – it is not this banking cartel's mission to act in the best interest of the American public.

Greece’s biggest company quits for Switzerland (westcoastjan)

“A primary listing on Europe’s biggest and most liquid stock exchange reflects better the international character of Coca Cola Hellenic’s business activities and shareholder base,” the company said in its regulatory statement.

Infographic: Is Silver The New Gold Created By The Silver Bomb (Taki T.)

And while gold remains a smart move, there’s much to be said for silver. Why? Because, unlike gold, silver has an inherent value that goes well beyond scarcity. Without silver the world as we know it would literally stop. The computer screen on which you are reading these words, has silver in it. The TV you watch, has silver in it…and the list goes on and on.

John Williams on Lies, Damned Lies and the 7.8% Unemployment Rate (Phil H.)

What few people realize is that the headline unemployment rate is calculated each month using a unique set of seasonal adjustments. The August unemployment rate, which was 8.1%, was calculated using what BLS calls a “concurrent seasonal factor adjustment.” Each month the agency recalculates the series to adjust for regular seasonal patterns tied to the school year or holiday shopping season or whatever is considered relevant. The next month, it does the same thing using another set of seasonal factors. Rather than publish a number that’s consistent with the prior month’s estimate, it recalculates everything, including the previous month, but it doesn’t publish the revised number from the previous month.

Renewables Are Overrated, We Need Cheap Oil – Interview with Gail Tverberg (Arthur Robey)

Gail Tverberg is an independent researcher who examines questions related to oil supply, substitutes, and their impact on the economy. Her background is as a casualty actuary, making financial projections within the insurance industry. She became interested in the question of oil shortages in 2005, and has written and spoken about the expected impact of limited oil supply since then to a variety of audiences: insurance, academic, “peak oil”, and more general audiences. Her work can be found on her website, Our Finite World.

Pipeline To Nowhere? (James S.)

Natural gas also is what industry folk call “a lower 48-state commodity”, meaning it’s pretty much land-locked to the U.S. We have the capacity to import gas in the form of LNG. We just do not have much capacity to export LNG.

Ottawa to consider penning oilsands caribou (westcoastjan)

The idea follows a study released in July by the Oilsands Leadership Initiative that recommended fencing off at least 1,500 square kilometres to protect caribou from predators such as wolves.

Article suggestions for the Daily Digest can be sent to dd@peakprosperity.com. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."