Panic over possible debt ceiling accident

http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield

At least some people think there is a small chance that they won't get paid right away for their expiring T-bills and are selling them at a discount.

When was the last time the 1-month notes were that high?  February 7, 2014. What happened then? A similar debate over raising the national debt limit.  Note that the debt limit was $17,226 billion then, and it is $18,152 billion now.  And soon it will jump a few hundred billion more as soon as Congress caves and approves a new ceiling.

See also: http://www.cnbc.com/2015/10/19/lew-i-worry-there-could-be-a-debt-limit-accident-that-could-be-terrible.html

Treasury Secretary Jack Lew said Monday he worries that waiting until the last minute to raise the nation's borrowing authority could result in an accident "that would be terrible."

Last week, Lew said the U.S. debt ceiling will be exhausted Nov. 3, two days before previously estimated. In a letter to congressional leaders, he added that a remaining cash balance of less than $30 billion would swiftly deplete.

"Our best estimate is November 3rd is when we'll exhaust what we call extraordinary measures; those are things we can do to manage things. I will run out of things that I can manage on November 3rd," Lew told CNBC's "Squawk Box."

==================================
 Only 2 weeks until the system collapses! Unless the evil Republicans can be convinced to raise the debt ceiling. Are there negotiations going on? Nope, the president won't negotiate.

August 9, 2007 - the day the system broke

I started this blog in June 2010 because of a feeling that there was something very wrong in the financial world.  Most of my fears then seem to have been overblown, and I don't post very much anymore.  I would like to say definitely that everything is ok.  But they aren't, which is evidenced by the fact that the Fed has kept its rate at 0% for almost 7 years (it was lowered on Dec. 16, 2008).

It is interesting to note that August 9, 2007 was the day that things started to go wrong.

See http://www.theguardian.com/business/2011/dec/01/credit-crunch-pinpointed-august-2007

The former boss of Northern Rock, Adam Applegarth, pinpointed the start of the first credit crunch as 9 August 2007. It was the "day the world changed," he said. The European Central Bank and the US Federal Reserve injected $90bn (£45bn) into jittery financial markets that day, but it was still not enough to stop banks being frozen out of the markets they relied on for funding.

http://www.alhambrapartners.com/2014/08/11/the-anniversary-no-going-back/
Everything that has occurred in the years since can be traced to those days in August 2007 when money markets broke down for the first time. Even the current, though measured, move away from the US dollar in global trade is as much a downstream event of then as anything else. Careful examination reveals that it was the eurodollar system, linked to trade and financialism, that has wrought such persisting havoc and malaise.

http://www.alhambrapartners.com/2015/08/10/still-no-going-back-eighth-anniversary/ In very general terms, central banks could do no wrong prior, and then “suddenly” have been able to do nothing right since. The titanic shift in August 2007 cannot be overstated. The Fed (and all its central bank network) continued to do as it had done before, starting in September 2007 with its first very orthodox, quite textbook 50 bps cut in the federal funds rate. From then on, no matter what it did, the financial system remained unaffected and so with it the economy.

http://www.theguardian.com/business/2012/aug/07/credit-crunch-boom-bust-timeline
Larry Elliott, economics editor, said: "As far as the financial markets are concerned, August 9 2007 has all the resonance of August 4 1914. It marks the cut-off point between 'an Edwardian summer' of prosperity and tranquillity and the trench warfare of the credit crunch – the failed banks, the petrified markets, the property markets blown to pieces by a shortage of credit"

http://davidstockmanscontracorner.com/mind-the-eurodollar-markets-thats-where-the-exit-ramps-are-closing/
The rift in the global eurodollar exchange system that opened in 2007 is not closing, rather it remains in a state of paradigm shift that can only strain further a liquidity system that has actually lost robustness from even its weakened state just prior to near-collapse.

The weaponization of the Eurodollar

I'm in way over my head on this, but lower oil prices and the collapsing world economy are causing a Eurodollar liquidity crisis.

"Investors may have underestimated the degree to which a rising dollar transmits tighter monetary policy across an already misfiring global economy, especially when it is carrying US$10 trillion (+70% since 2008) in offshore Eurodollar debt. From a Chinese (especially) and EM standpoint in particular, it is becoming increasingly clear that the dollar has been “weaponised.” http://ftalphaville.ft.com/2015/09/24/2140580/all-about-the-eurodollars-redux/

A eurodollar can be defined simply as a dollar that is outside the borders of the United States.  However, I don't think it is that simple.  Obviously, physical cash can circulate outside the borders.  But for electronic dollars, I think there has to be some sort of connection to the US, like an account at a big bank, e.g. JP Morgan, or a correspondent relationship with one of the big banks.

However, even without the connection, two parties could agree on a transaction denominated in dollars, and then settle it based on the prevailing exchange rates.  This is no problem if it settles quickly.  However, if there is a long-term loan or time deposit, the problem arises.

If the dollar strengthens in value (which happens because for some reason everyone trusts it), then paying back the loan or deposit becomes much more costly.  This causes spiraling deflation, which is why oil prices and gold prices keep going down.  Of course the countries would prefer to sell oil and gold at higher prices, but they have loan payments due and have to liquidate assets in order to meet their obligation.

This isn't a problem in the US so we don't see the effects, but there is a $10 trillion elephant sitting on the world economy.  These are dollars not created by the Fed, but they still exist.  (Other entities besides the Fed can create money, I have written previously about that, but I haven't considered international banks creating dollars).  This could cause a global economic collapse.  And maybe the Fed would step in as a lender of last resort, and in exchange for its help, effectively demand oversight over banks that it is lending to.

The Fed does provide "swap lines" to other central banks like the ECB and BOJ, but it doesn't to China.  So this could be considered economic warfare against China, which must liquidate its (mostly treasury bond) assets.  This is a topic to research more.

Don't mess with Hungary

Shemitah Fail

Today is the 14th anniversary of the 9/11 attacks on the World Trade Center twin towers.  And it is also the last business day of the Jewish year.  Technically, Sunday is Elul 29 and today is Elul 27, but this is the last business day before that.  Monday, Sept. 14 is Tishri 1, the Jewish New Year (Rosh Hashana).

Every seven years on Elul 29, the stock market crashes.  So says Messianic Jewish Rabbi Johnathan Cahn.  But not this year, thank God.

So the disaster that was supposed to happen today, didn't.  This is another failed prediction, like 12/21/12, which was a dud.  Johnathan Cahn is a fraud.

Quote:
"On the stock market, Cahn goes on to explain, “I want people to be aware and be warned . . . . In the last 40 years . . . you have these collapses in the markets, long term collapses.  The dates are 1973, 1980, 1987, 2000 and 2007.  Every single one of them is on the seven year cycle.  Not only that, every single one of them happens at the time of the Shemitah.  It’s not just a 7 year cycle, but on the exact appointed time.  This has happened every single time, and the last two have been so exact . . . what you have is the greatest stock market point crash, September 17, caused by 9/11.  That day that it crashed is “Elul 29,” the day that is appointed in the Bible of an exact date you have to wipe out financial accounts and becomes a sign of warning of a nation under judgment.  On the exact day, September 17, 2001, you have “Elul 29” that happens not just once a year, Elul 29 happens every 7 years.  Then, that record stays for the next 7  years until you get to the great crash of the great recession.  The greatest crash in history, September 29, 2008, they ring the bell, and the bell refuses to ring.  They take that as a sign, and on that day comes the greatest crash in American history.  Not only on that day, but it was the wipe-out day of the Shemitah that happens only once every 7 years.  So, the two greatest crashes happened exactly 7 Biblical years apart  down to the day, down to the hour, and down to the minute."
http://usawatchdog.com/great-shaking-and-collapse-is-coming-jonathan-cahn/

He was predicting that a massive stock market crash would occur TODAY.  And it didn't. I'm not rooting for it, but I like to see patterns if they exist.  I know some people were saying that Shemitah came early this year, on August 25.  But he is talking about "the exact appointed time", "an exact date", "down to the day".

Epic Fail!

Goldin 117 Tower tops out

Goldin Finance 117 Tower, in Tianjin, China, tops out at 1,957 feet (596 m).  The article says that it is the 2nd tallest structure in the world, but that isn't correct - I think it is the 5th.

They should have made it just a little taller and it would be over 600m and taller than the Mecca Clock Tower.

The list of the tallest buildings in the world is now:

1. Burj Khalifa, Dubai, 828m (2010) 
2. Shanghai Tower, 632m (2014).
3. Abraj Al Bait, Mekka (Mecca Royal Hotel Clock Tower), 601m (2011) 
4. Ping An Finance Center, Shenzhen, 599m (2016)
5. Goldin Finance 117 Tower, Tianjin, 596m (2015)
6. One World Trade Center, New York, 541m (2013) 
7. CTF Finance Center, Guangzhou, 530m (2016)
8. Taipei 101, Taipei, 509m (2004) 
9. Shanghai World Financial Center, 492m (2008) 
10. International Commerce Center, Hongkong, 484m (2010) 
11. Petronas Towers, Kuala Lumpur, 452m (1998) 
12. Greenland Financial Center (aka Zifeng Tower), Nanjing, 450m (2010) 

See also: Shanghai Tower tops out

Ungrateful migrants

How dare you give us water.

SLS Las Vegas deathwatch

SLS Las Vegas net loss reaches $48.6 million in second quarter

"In the SEC quarterly filing, Stockbridge/SBE said total revenue between April and June was $36.9 million".  So expenses were $85.5 million for the 2nd quarter.

"Stockbridge said in the SEC filing it intends to provide SLS Las Vegas with "sufficient funds" through Dec. 31 to meet the property's obligations."  What if it burns through another $100 million through the end of the year?

Expect a shutdown in January.

=============
UPDATE:
The Hard Rock Hotel & Casino Las Vegas is also hemorrhaging cash.

he company that owns the Hard Rock Hotel & Casino Las Vegas, Bref HR, has struggled for years, incurring losses for $103 million, $105.5 million and about $116 million for 2014, 2013 and 2015, respectively. There is substantial doubt about Bref's ability to continue as a going concern, or without the threat of liquidation, because of debt and losses says the company's accountant, Deloitte & Touche LLP, in an April 14 filing with the U.S. Securities and Exchange Commission.
http://www.themiddlemarket.com/news/restructurings/turnaround-tuesday-losses-mount-for-hard-rock-las-vegas-hotel-255697-1.html

Planned ghost town to be built in New Mexico

A new city is being built in the middle of the desert at a whopping price tag of $1.4 billion and while it’s a very real place, it’s unlike anything the world has ever seen.

Despite featuring all the infrastructure you’d expect to find in a normal city, including skyscrapers, 35,000 homes, a shopping centre, church, service station and an airport, nobody will be allowed to live here.

The 38-square-kilometre area will also encompass farms, an industrial area, a rural road system and a highway.

It will be under constant surveillance and connected by underground tunnels, yet there will be no colourful details such as artwork or billboards.

Welcome to the Center for Innovation, Testing and Evaluation (CITE), a planned ghost town for New Mexico, America.

Essentially, it’s a huge, fully functional test city, the first of its kind in the world.

http://www.news.com.au/travel/travel-ideas/new-14-billion-city-is-being-built-in-the-desert/story-fnjpja3r-1227502878740

Another day, another drop

Wow.  Today (Aug 25) the Dow dropped another 204.91 to close at 15,666.44.

That is 6 days down in a row.  I wonder when was the last time that happened.

DJIA trend

Everyone is talking about the Dow's roller coaster ride today.  It last closed at 16,459.75, and upon open, almost immediately dropped 1,089.42 to 15,370.33 and then over the next several hours, regained almost all of that to reach 16,344.50 at 1:10pm (a rise of 974.17), which if it had closed at that point, would have resulted in a loss of only 115.25 for the day.  But then it plummeted again, closing at 15,871,35, a loss of 588.40 for the day.

I'm more concerned about the trend.  Check this out:
Aug 17, 2015 17,545.18
Aug 18, 2015 17,511.34
Aug 19, 2015 17,348.73
Aug 20, 2015 16,990.69
Aug 21, 2015 16,459.75
Aug 24, 2015 15,871.35

It dropped 5 days in a row, and over those 5 days dropped 1673.83 or 9.5%.  I think it will rise back into the 16,000 range for now. But I think it has farther to drop over the next few months.

Pentagon Accounting Fail

See http://www.reuters.com/article/2013/11/18/us-usa-pentagon-waste-specialreport-idUSBRE9AH0LQ20131118

At the DFAS offices that handle accounting for the Army, Navy, Air Force and other defense agencies, fudging the accounts with false entries is standard operating procedure, Reuters has found. And plugging isn't confined to DFAS (pronounced DEE-fass). Former military service officials say record-keeping at the operational level throughout the services is rife with made-up numbers to cover lost or missing information.

See also: http://www.businessinsider.com/why-dod-cant-balance-its-book-2013-2

http://www.thefiscaltimes.com/Articles/2013/02/11/Why-the-Defense-Department-Cant-Balance-Its-Books
http://cjonline.com/blog-post/lucinda/2015-08-20/united-states-pentagon-accounting-system-joke
http://foreignpolicy.com/2015/08/03/the-pentagon-is-still-terrible-at-accounting-for-taxpayer-dollars-marine-corps-800-million-gao/
http://www.globalresearch.ca/report-reveals-8-5-trillion-missing-from-pentagon-budget-2/5453618

Must have moar debt!

http://www.nytimes.com/2015/08/21/opinion/paul-krugman-debt-is-good-for-the-economy.html

The Village Idiot speaks:
there’s a reasonable argument to be made that part of what ails the world economy right now is that governments aren’t deep enough in debt. we need more, not less, government debt.

The US doesn't have operational control of southern Arizona

FLORENCE, Arizona — “Nobody does,” Pinal County Sheriff Paul Babeu told Breitbart News when asked who has operational control of this region of the United States of America. Babeu was on a helicopter tour of Mexican drug cartel scout locations in caves in the side of mountains throughout the desert about 70 miles inside the U.S. border. Essentially, that means U.S. sovereignty is gone for hundreds, perhaps thousands, of square miles throughout the American southwest.

--http://www.breitbart.com/big-government/2015/08/19/exclusive-az-sheriff-takes-dr-ben-carson-on-helicopter-tour-of-cartel-sites/

October 7

Martin (Weiss): There’s a finite date associated with your forecast. Please explain.

Larry (Edelson): It’s October 7, 2015, when we enter a new phase of the global economy, a phase when everything starts to hit the fan at once. It doesn’t necessarily mean that a precipitous event will occur on that day. There may be, there may not be. But it does mark a line in the sand between two eras:

* The current era when government debts continue to grow with reckless abandon, when nobody really gives a hoot and …

* A new era, when we’re all going to have to pay a big price for that government debt.

It’s a giant shift in the entire economic landscape, a time when governments must finally meet a great day of reckoning. I call it the “Great Convergence.”

Martin: When’s the last time we’ve seen a convergence point of this magnitude?

Larry: In 1929.

From http://www.moneyandmarkets.com/72473-72473

Biggest Primes

This is the list of all prime numbers with more than 3 million digits:

From https://primes.utm.edu/primes/lists/all.txt

    1  2^57885161-1                    17425170 G13   2013 Mersenne 48??
    2  2^43112609-1                    12978189 G10   2008 Mersenne 47??
    3  2^42643801-1                    12837064 G12   2009 Mersenne 46??
    4  2^37156667-1                    11185272 G11   2008 Mersenne 45?
    5  2^32582657-1                     9808358 G9    2006 Mersenne 44
    6  2^30402457-1                     9152052 G9    2005 Mersenne 43
    7  2^25964951-1                     7816230 G8    2005 Mersenne 42
    8  2^24036583-1                     7235733 G7    2004 Mersenne 41
    9  2^20996011-1                     6320430 G6    2003 Mersenne 40
   10  2^13466917-1                     4053946 G5    2001 Mersenne 39
   11  19249*2^13018586+1               3918990 SB10  2007 
   12c 3*2^11895718-1                   3580969 L4159 2015 
   13f 3*2^11731850-1                   3531640 L4103 2015 
   14  3*2^11484018-1                   3457035 L3993 2014 
   15  3*2^10829346+1                   3259959 L3770 2014 

From: http://www.primenumbers.net/prptop/prptop.php

1 (2^13372531+1)/3 4025533 Ryan Propper 09/2013
2 (2^13347311+1)/3 4017941 Ryan Propper 09/2013

I don't know why the last two aren't in the main prime numbers database.

Update:  The last 2 numbers are called Wagstaff primes, and it is extremely difficult to prove that they are actually prime.  That is why the Mersenne primes are so attractive, because there is a test for primality.

The number that starts with 19249 is part of the Seventeen or Bust projects, which is an attempt to prove (or disprove) the  Sierpinski problem, which I don't understand.

The numbers that start with 3*2 are part of the 321 Prime Search project on PrimeGrid, which keeps finding new megaprimes.

What is the benefit of finding such large numbers?  Really none at all.  Except to expand the horizons of what is thought possible.

New Formula for Primes

4*(10^500+317)^2-2*(10^500+317)+41, number of digits: 1001, time: 180988, ends in 401363.

4*(10^600+233)^2-2*(10^600+233)+41, number of digits: 1201, time: 252649, ends in 216731

And a 2000-digit number:
 4*(10^1000+14)^2+2*(10^1000+14)+41, number of digits: 2001, time: 71016, ends in 853.

New 2500 digit number:
4*(10^1250+232)^2-2*(10^1250+232)+41, number of digits: 2501, time: 1711446 (about 29 minutes), ends in 214873.

2000 digit prime number

210*(10^1997+31)+13, number of digits: 2000, time: 580956 (about 10 minutes). It ends in 6523


Update:  I tried to calculate a 3000 digit number but my machine froze up.  So that is about the limit of what I can do.

Primes

This is a diversion, but I created a simple program using BigInteger in Java to create prime numbers.

These are some prime numbers I calculated.  They have NOT been verified.  It is much,much more difficult to verify than to prove one.  My goal is to find a really big one, 20,000 digits or more and post it publicly. Time is in milliseconds.

Possible primes:
210*(10^397+16)-17, number of digits: 400, time:  2572.  Verified by WolframAlpha.
210*(10^447+15)-19, number of digits: 450, time: 3831
210*(10^497+18)-19, number of digits: 500, time: 5893
210*(10^547+37)+13, number of digits: 550, time: 15780
210*(10^597+17)-17, number of digits: 600, time: 8751
210*(10^647+4)-17, number of digits: 650, time: 2844
210*(10^697+8)-19, number of digits: 700, time: 6498
210*(10^797+89)+13,number of digits: 800, time: 89458
210*(10^897+6)-17,number of digits: 900, time: 9726
210*(10^997+72)-13,number of digits: 1000, time: 165535. This is a titanic prime! Verified by WolframAlpha.

210*(10^1097+146)+13, number of digits: 1100, time: 459584


210*(10^1197+162)+11, number of digits: 1200, time: 670547   This is a number starting with 21, about 1200 zeroes and ending in 34031.


210*(10^1247+96)+17, number of digits: 1250, time:  446148. This number ends in 20177.


210*(10^1297+22)-17,number of digits: 1300, time: 120943. It ends in 4603.


210*(10^1397+179)+17, number of digits: 1400, time:  1116773. It ends in 37607.


And that's about all I have time for.  Interesting. The first titanic prime (Mersenne prime 19) wasn't discovered until 1961.

MM61

Double Mersenne primes have the format: 2^(2^prime(n) - 1) - 1. MM61 means 2^(2^61-1)-1 or 2^{2305843009213693951} - 1. This number has approximately 694127911065419641 digits. It is unknown whether this number is prime or composite.

This is the smallest double Mersenne prime for which it is unknown whether it is composite or prime. Yet people are obsessed with proving that it is prime.  Or not.

"A number of people (including the author of this page) have tried finding divisors of MM61, MM89, MM107, MM127, MM521, MM607 and others, but so far without success"
--http://sites.google.com/site/anthonydforbes/mm61.htm

It has been proven that MM61 is not divisible by any number up to 1167025860000000.

That is some dedication. I wonder if we will ever know the answer.