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Economic and and financial news and analysis

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Why Reform Won’t Work- Charles Hugh Smith

This is a syndicated repost courtesy of oftwominds-Charles Hugh Smith. To view original, click here. Reposted with permission. Follow the money. Find the profits!Liquidity is money. Regardless of where in the world that money originates, eventually it flows to and through Wall Street. So if you want to know the direction of the next big…

Washington’s dilemma on a ‘lost’ planet- Noam Chomsky

Washington’s dilemma on a ‘lost’ planet By Noam Chomsky Follow the money. Find the profits!Liquidity is money. Regardless of where in the world that money originates, eventually it flows to and through Wall Street. So if you want to know the direction of the next big moves in stocks and bonds, just follow the money.…

When Will The Bug Hit The Windshield

Russ Winter thinks the markets are a bug waiting to be hit by a windshield at any time but Lee Adler thinks that the timing of that event can be recognized in time to do something about it. Listen as they discuss how to approach the crisis that lies ahead. This is a subscriber only podcast, subscribers may click here to listen. If you are not a subscriber, click here to access the Monday, January 7  podcast (Will Lousy Earnings Matter With Fed Pumping It Up?) . Subscribers can click the player at the bottom of this post (visible on Radio Free Wall Street main site only) to listen to today’s podcast, or use this link to download. If you are not a subscriber and would like to hear not only today’s podcast but all 8 or 9 podcasts each month, click this button to start your subscription. It takes less than a minute to complete the signup form and start listening to all Radio Free Wall Street podcasts. To learn more click here! or join and listen right now! By clicking this button, I agree to the Wall Street Examiner’s Terms of Use. 3 month subscription to Radio Free Wall Street podcasts, renewing automatically unless canceled.Price: $29.00 […]

Early Exit from Bank of Japan Governor is Good for Abe- Money Morning

Bank of Japan Governor Masaaki Shirakawa told Prime Minister Shinzo Abe yesterday (Tuesdsay) that he will step down a few weeks early, on March 19, in order to align his term, which expires on April 8, with those of the two BoJ deputy governors.

“I told the prime minister that I will resign on March 19 so that a structure with a new governor and two deputy governors can start simultaneously,” Shirakawa said at a press conference called after a meeting of the Council on Economic and Fiscal Poicy.

This will enable Abe to replace the entire central bank leadership all at once with people who are more sympathetic to his policy of unlimited easing.

Although some press reports have highlighted the apparent unenthusiastic support Shirakawa is giving to Abe’s policies, Shirakawa’s resignation is really just putting the Bank of Japan leadership transition process back to normal.

The Bank of Japan governor must be approved by both houses of the Diet. Back in 2008, former deputy governor Toshiro Mutoh was nominated for the top spot by the ruling Liberal Democratic Party (LDP) which held a majority in the Lower House but not in the Upper House, where the opposition Democratic Party of Japan (DPJ) held sway.

The DPJ rejected Mutoh’s nomination and it took three weeks of political infighting before Shirakawa was approved as a compromise candidate and took office on April 9.

The situation is exactly the same today. Abe’s LDP has a super majority in the Lower House but must get some opposition support to get their nominee approved by the Upper House.

By resigning as governor effective March 19, Shirakawa is undoing the delay caused by political wrangling five years ago.

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Water Stocks: Don’t Overlook This $1 Trillion Opportunity – Money Morning

With most water delivery systems badly in need of repair or replacement, companies that supply the solutions figure to profit handsomely – making now a good time for investing in water stocks.

In the United States alone, estimates of water infrastructure needs run as high as $1 trillion.

Many of the pipes that carry water to U.S. residents are more than 60 years old, with some more than 100 years old. Water main breaks and sinkholes from leaking pipes are common in many U.S. cities.

Water infrastructure is in such bad shape that the nation’s pipes leak 1.7 trillion gallons every year. The water lost in a single day is enough to supply the entire state of California.

Pressure to spend more money on the nation’s water infrastructure is increasing. This week the National Association of Water Companies and U.S. Chamber of Commerce launched a campaign, “Water is Your Business,” to draw more attention to the problem.

And the public is already on board.

In a recent survey taken by water infrastructure company Xylem Inc. (NYSE: XYL), 88% of those polled said the government should be investing in water infrastructure, and 65% said they would accept slightly higher monthly water bills to pay for it.

With the need reaching a critical stage and pressure to act building, U.S. government spending to repair water infrastructure is bound to increase very soon and very rapidly, a golden opportunity for water stocks.

But the opportunity extends beyond the United States. The World Water Council says that current annual infrastructure spending of about $80 billion will double just within the next several years.

And rising global demand for water, driven by population growth, adds even more urgency to the problem.

The United Nations estimates that fresh water withdrawals have increased threefold over the past 50 years, as demand rises by 16.9 trillion gallons every year.

“A billion people lack access to clean water,” Bank of America Merrill Lynch wrote in a recent research note explaining why it likes water ETFs. “Water is undergoing pressure both on the supply and demand side.”

In the years to come, as governments around the world start spending the hundreds of billions of dollars needed to address these problems, money will flood into water stocks.

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Investing in 2013: Why You Can’t Ignore Palladium – Money Morning

Anyone who looks at precious metals when investing in 2013 will likely turn to gold and silver, maybe even platinum.

But there is another precious metal that is often overlooked, and should not be: palladium.

Palladium is mainly used in catalytic converters on gasoline-powered vehicles to limit the pollution these vehicles emit, just as its sister metal, platinum, is used in a similar fashion for diesel-powered vehicles.

Palladium recently touched a 16-month high of over $750 an ounce, up more than 25% since November.

And right now it’s offering investors a huge profit opportunity as its price climbs.

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On the Numbers – Bruce Krasting

  We got a big reminder of the importance of government spending in the Q4 GDP report. The damn military delayed some expenditures for a few months, and it knocked 1.3% of the quarter’s growth rate. If it weren’t for the pikers at the Pentagon, we would have been in the black. GDP = Jobs, […]

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