CURRENCY RESERVES DOWN

BEIJING--China's foreign-exchange reserves in November fell to their lowest level in more than two years, reigniting concerns about Beijing's ability to stem the outflow of capital from the world's second-largest economy.

Read more: http://www.nasdaq.com/article/china-nov-foreignexchange-reserves-down-to-lowest-level-in-more-than-two-years

OVERNIGHT

 Reuters's reports that Asian share markets bounced on Monday after Wall Street welcomed an upbeat U.S. jobs report that suggested the world's biggest economy was well placed to handle an expected first increase in interest rates in almost a decade.

Oil prices were near their lowest since 2009 in the wake of the Organization of the Petroleum Exporting Countries' decision to keep production high despite depressed demand.

Equity investors in Asia were also wary ahead of a bevy of Chinese data which are expected to show a still sluggish economy. Trade figures are due on Tuesday, followed by inflation on Wednesday and industrial output and retail sales on Saturday.

Japan's Nikkei .N225 led the way with a 1.2 percent gain, while Australian stocks managed only 0.1 percent. The CSI300 index .CSI300 of the largest listed companies in Shanghai and 

Shenzhen started soft before inching up 0.2 percent.

The WSJ is reporting Investors are taking positions ahead of gauges of Chinese inflation, trade, retail sales and industrial production within the next week.

After a shaky start, Chinese markets advanced later in the morning, with the Shanghai 

Composite up 0.4% and the smaller Shenzhen market jumping 1.2%.

The Hang Seng China Enterprises Index, which tracks Chinese companies with offshore listings, was last up 0.3% after briefly turning negative in the morning.

Reuters' is reporting these results fron Sunday's Venezuelan elections.

Venezuela's opposition won control of the legislature from the ruling Socialists for the first time in 16 years on Sunday, giving them a long-sought platform to challenge President Nicolas Maduro.Election board head Tibisay Lucena said the opposition Democratic Unity coalition won 99 seats to the Socialists' 46 in the 167-national National Assembly with some districts still to be counted.When she finished speaking, fireworks went off in pro-opposition districts of Caracas.

Maduro, 53, quickly acknowledged the defeat, the worst for the ruling "Chavismo" movement since its founder Hugo Chavez took power in the South American OPEC nation in 1999.

INVESTMENT GURU

Twenty-five years ago investment rock star Peter Lynch stepped away from Magellen, the huge Fidelity mutual fund he put on the investments map. Lynch wrote a best selling investment book in his day that is still worth a read for market students and popularized terms like four-bagger and backing up the truck.

What he now says he didn't do is recommend what has long been attributed to him as a simplification of his investment philosophy, investing in "what you know." Now 71 he still follows the market, but notes the market is different today if for no other reason than ETFs weren't around back then, a fact he comments on below.

Contrary to today, Lynch was one of the guys of his era (and there were others) who proved individual money managers could and did beat the market averages regularly or, in Wall Street parlance, add alpha. Lynch was also known for his attention to fundamental research.

Here are some excerpts from a recent WSJ piece.wsj.com/articles/peter-lynch-25-years-later-its-not-just-invest-in-what-you-know.

Use your specialized knowledge to home in on stocks you can analyze, study them and then decide if they’re worth owning. The best way to invest is to look at companies competing in the field where you work. Someone with deep restaurant-industry experience would have predicted the success of Panera Bread Co. and Chipotle Mexican Grill Inc., he says: “If you’re in the steel industry and it ever turns around, you’ll see it before I do.” 

Speaking of restaurants which have an average life span of about five years, Lynch once warned about those eateries that depend on liquor sales for a good portion of their revenue, saying the food better be good because liquor tastes the same everywhere.

The market is different than in 1990. One of the biggest changes: exchange-traded funds. Mr. Lynch credits their rise with a distrust of mutual-fund managers, which he says is unwarranted. “People accept that active managers can’t beat the market and it’s just not true,” he says. (A Fidelity spokesman says about three-quarters of its 49 equity funds managed by the same portfolio manager for at least five years were beating their benchmark over the manager’s tenure as of Sept. 30.) Mr. Lynch’s advice for small investors: Picking individual stocks is hard even for the professionals. So “if you can’t understand the balance sheet, you probably shouldn’t own it.”

SOLAR PANELS, WINDMILLS AND SCREWED CONSUMERS

There is an old saying no good deed goes unpunished.

A rough translation of that is: If there's a way to screw the consumer we will  find it. Or for every action there is a reaction.Wouldn't it be nice if someone told the bureaucrats and politicians.

Here's a story from MarketWatch we're sure all those climate change freaks and alternative energy pushers will love.

It’s getting harder to figure out whether converting your home to solar energy makes financial sense as utilities adopt new ways to pay customers who pump electricity into the electric grid.
Most utilities buy homeowners’ excess solar power for the same price they sell power from the grid. This idea, called net metering, is easy to understand: Buyer and seller get the same price.
But some utilities around the country complain that net metering doesn’t cover their costs of accommodating solar. With support from regulators, they’ve started paying for home solar at lower prices than grid power.

Consumers need to pay attention to these changes. Most home solar systems export 40% to 60% of their electricity production back to the power grid, says Mark Dyson, a manager at the Rocky Mountain Institute, which studies alternate energy. Lower payments for that power have a big impact on whether home solar is cost effective.
 
In Hawaii — where utilities have griped that rooftop solar stresses parts of the power grid — regulators in October replaced net metering with a new price structure that slashes solar reimbursements.

In Honolulu and the rest of Oahu, rooftop solar owners have been reimbursed at Hawaiian Electric Co.’s retail price, which in 2014 averaged 35.48 cents per kilowatt hour. Under the state’s new rules, Oahu residents installing new rooftop systems will be paid around 15 cents per kilowatt hour — 64% less.

On Hawaii’s other islands, utilities won’t reimburse new solar customers more than 25 cents per kilowatt hour — the exact rate varies by company. The new price setup applies only to new solar installations. Homeowners who’ve already installed rooftop solar will continue to be paid at net metering rates.

Hawaii’s sky-high power prices make solar more popular there than anyplace else in the U.S. One in eight Aloha State homes has solar panels. Hawaii’s average retail electricity price in 2014 was 37.03 cents per kilowatt hour, the nation’s highest. That’s more than double the 18 cents it costs to produce a kilowatt hour of solar in Honolulu, according to an online calculator posted by the U.S. National Renewable Energy Laboratory.

Solar is so cheap compared with Hawaii’s grid power, it’s still a good deal despite the state’s new price rules. “Even with the reduced benefit, you still save money,” said Colin Yost, chief executive of RevoluSun, a Honolulu solar installer. “But it becomes a little less valuable.” Yost thinks the new tariffs will force lower-income customers to think twice about switching over to solar.

If you think they're going to let you leave quietly, solar panels, wind mills or cow flatulence, when there's money and "power"at stake, you probably believe there won't be any ISIS terrorists in the 10,000 Syrian refugees Obama and his crowd want to let into this country.

marketwatch.com/story/why-some-states-are-making-going-solar-more-expensive-2015-12-04.

RECYCLED WATER

She loves me, she loves me not. Anyone remember that childhood flower-petal-picking game?

The economy is doing well, the economy is not doing so well.  New jobs are being created, new jobs are not being created. The Fed wants to crank up interest rates--and most likely will--in a few days and as we've noted before they are data driven. Some might say, data paralyzed.

So you originally put out a feeler to see what the reaction is. It doesn't get the reaction you want. So you give it a little time and then you roll out a revised number. It's nice work if you're fortunate enough to get it. It's what a colleague calls economic plastic surgery. We fixed the nose last month. This month we'll doctor up the jobs numbers.

This “Jobs Friday” ritual is getting truly absurd. So it can’t be repeated often enough: These artifacts of the BLS’ seasonally maladjusted, trend-cycle modeled, heavily imputed/crafted and five times revised “jobs” numbers have precious little to do with the real health of the main street economy. 

Indeed, the six-year run of job gains since early 2010 primarily represent “born-again jobs” and part-time gigs. In economic terms, they do not remotely resemble your grandfather’s industrial era economy when a “job” lasted 40 to 50 hours per week all year round; and most of what the BLS survey counted as “jobs” paid a living wage. 

Not now. Not even close. 

Don't drink the water. It's been recycled. More:

davidstockmanscontracorner.com/these-aint-your-grandfathers-jobs-why-fridays-rip-should-be-sold/

FIT TO SPIN

We've been harping about MSM and it's phony memes longer than most. Why? Because we were once part of that charade. Some might claim that makes us too close to the forest to see the Aspens. Not hardly.

Popular media terms like back grounding the news and interpretive reporting were staples of media protocol for years. Even the slightest cogitation about those terms and what they really mean should tell you pretty much what you need to know--media doesn't think much of its masses.

They need you otherwise there's no need for them to exist. But it's a clear and, especially to them, holier than thou relationship. And we know who the holier are. They even have conceited names for themselves like the Fourth Estate. Now comes this piece from The Daily Bell. One can labor in the wilderness for years thinking he or she is quite alone in one's views only to discover there are others who get it.

Confirmation one is not alone can be an invigorating thing. Sort of like Hugo's intersection about an idea and time. The globe is an unsafe place. And that makes MSM and what they do all the more important. It's your safety and your liberty that rides in the balance. Your freedom. And the future you somehow save just might be yours.

Here's an excerpt.

Dr. Udo Ulfakatte is a top German journalist and editor and has been for more than two decades, so you can bet he knows a thing or two about mainstream media and what really happens behind the scenes. Recently, Dr. Ulfakatte went on public television stating that he was forced to publish the works of intelligence agents under his own name, also adding that noncompliance with these orders would result in him losing his job. He recently made an appearance on RT news to share these facts: 

"I've been a journalist for about 25 years, and I was educated to lie, to betray, and not to tell the truth to the public. But seeing right now within the last months how the German and American media tries to bring war to the people in Europe, to bring war to Russia — this is a point of no return and I'm going to stand up and say it is not right what I have done in the past, to manipulate people, to make propaganda against Russia, and it is not right what my colleagues do and have done in the past because they are bribed to betray the people, not only in Germany, all over Europe." 

It's difficult to find a more prominent member of MSM than the New York Times. That scribe has a famous logo, "All the news that's fit to print." We see it just one word differently: "All the news that's fit to spin."

Now if you don't think, as the Daily Bell says, that there isn't tons of monopoly money floating around the world trying to influence outcomes, you've never heard of people like George Soros and his leftist billionaire climate change freaks.

Now someone will no doubt write in and ask: "What about those Wichita Koch brothers on the right?"  And here's response: What about them?

thedailybell.com/editorials/36676/Anthony-Wile-Directed-History-Hey-We-Told-You-So/ 

THE ECB GOUGE

Well, we've all heard of the Oracle of Omaha, alias the Scold of Omaha.

Now we've had the privilege to hear fron the Oracle of the ECB. Some might say the Scold of the ECB. One day after global markets went slam, bam, no thank you man, Magic Mario told investors to calm down, blaming "markets for messing up."

Yes, this is Magic Mario in his earlier today address to the Economic Club of New York where, referring to his interest rate cuts the day before, he said: "It was not a package meant to address market expectations," concluding the whole thing was "overblown." Oh, and one more thing. Deflation is no longer on the table and the ECB's stimulus packages are "already working."

But here's the quote we relish most and so should you because it shows just how dangerous this former Goldman Sachs executive trainee now turned bureaucrat is. "We have the power to act. We have the determination to act. We have the commitment to act," he said, possibly stealing a rhetorical ploy from Winston Churchill.

In less than two days Magic Mario gouged the markets from a sell off to a big rally. Some might call it jerking the markets as in volatile swings in an attempt to repair the damage he caused.

SAVE YOUR CURRENCY AND YOUR SOVEREIGNTY

The Danes seem to get it more than most albeit they're still a piecemeal part of the European Union.

What they understand it appears are two terms we've discussed at length many times--solvency and sovereignty.  Like the lines of that old Sinatra tune, love and marriage, a horse and carriage, they go together. And it's pretty difficult if not impossible to have one without the other.

Last Thursday Danish voters sent a shrill warning to EU bureaucrats who are setting up for their next confab and confab is the correct term here because that's what bureaucrats spend their time doing. That itself should not surprise. That they get paid for it should.

There's another thing many Danes apparently understand, the dangers of immigration. Denmark has
reportedly some of the EU 's toughest immigration laws. Immigration today might be more dangerous than any time in the last 100 years.

As one scribe put it: The result marks a blow to a beleaguered EU, which faces the threat of a U.K. exit and a worsening crisis in Greece. The People’s Party has said it’s willing to enter an alliance with other EU-skeptical parties that would ask Danes to vote much more often on European reforms.

Next up is the UK, a nation already swamped in socialistic over-regulation and paralyzing bureaucracy. A campaign theme for the no crowd might be: Forget the Queen. Petition God to save your currency and your sovereignty.

REVISION OF THE REVISED

Just to pick up on our recent post about revision of the revised,financialspuds.blogspot.com/2015/12/what-is-two-plus-two, sounds like it could be a hot HBO series, here's a read everyone ought to read even those misguided souls who want to continue wallowing in their benighted states under that infamous Washington cry: "We're from the government and we're here to help you."

Unless you're suffering from a bad case of birth canal trauma or the hoodwinking so popular on today's college campuses, you might want to take a chance and step out of the Brainwashed Zone and think for yourself. We know it's painful, threatening, even downright frightening. The government is here all right, but only to take from you. That's their way of spelling help.

Recounting my own college years and how they taught "The Great Depression," and then spending years doing my own research, I eventually realized revision has been going on a lot longer than I even imagined. It's in the academic genetic code.

davidstockmanscontracorner.com/why-this-sucker-is-going-down-again

WHAT IS TWO PLUS TWO?

As we said recently, the news is out and it's all over the Street. Here's the blurb on it from
www.crossingwallstreet.com.

The November jobs report is out. Non-farm payrolls rose by 211,000. The unemployment rate held steady at 5.0%.

The September NFP was revised higher by 8,000 and October was revised up by 27,000. Average hourly earnings rose four cents to $25.25.

I think this pretty much guarantees a December rate hike. 

We don't question the poster. He's simply reporting what was announced. But our cynical side tells us two things: the Fed wants to raise rates before year end, right or wrong. The second thing is they're data freaks and desperately need data to support their constant stance of hedging or fence straddling.

In short, this not a group noted for its confidence or decisiveness. Check out Mario Draghi's action yesterday. We've written before about revisions and their constant part of government numbers. This is one of those: "Here,we can show you the figures!" Three out of four ain't bad, especially with the fourth one remaining stable.

It reminds of the story about a company CEO who calls in his CFO one day and asks: "What's two plus two these days?" And the CFO shoots back: "Anything you want it to be, boss!"

The Fed got want it wanted and needed, the numbers and the trend, to CYA.