BusinessWeek Writes: The Philippines’ Tax Sheriff Gets Tough

When Kim Henares took over the Bureau of Internal Revenue in the Philippines three years ago, she began looking for tax dodgers by poring over the society pages of newspapers and magazines. She says that as a result, she sent federal prosecutors complaints against two television actresses, a doctor, and a Lamborghini-driving pawnshop owner. “If you’re ready to flaunt it, then you must have paid taxes on it,” Henares says.

Her take-no-prisoners approach is part of President Benigno Aquino III’s crusade to erase a Philippine legacy of graft. Not paying taxes is one of the nation’s most common forms of corruption; the government estimates that $10 billion, or 4 percent of gross domestic product, goes unpaid every year. Henares says it’s her job to claw back as much of that as she can, and “if people don’t like me, that’s fine.”

Her agency alleged in 2011 that former President Gloria Arroyo’s son Juan Miguel had evaded taxes. His mother, a friend of Henares’s in-laws, had played a prominent role at her 2001 wedding. The case is continuing. Ruy Rondain, Juan Miguel Arroyo’s lawyer, says his client believes the charges are politically motivated. “There’s no case, so they made one up,” Rondain says. Last year, Henares’s agency asked prosecutors to file charges against former world boxing champion Manny Pacquiao, who’s now a federal legislator, for allegedly failing to submit documents proving that he paid the correct amount of taxes in 2010. A city prosecutor declined the agency’s request to file charges. Pacquaio told the Associated Press the complaint against him was “plain and simple harassment.”

Henares doesn’t discount the official statistics as a sign of progress. But for proof that her crackdown is haunting the country’s moneyed elite, she points to a more informal source. Henares says her mother hears from acquaintances that it now can cost 60 percent more than in the past to bribe an official for help dodging taxes.

Read The Rest Of The Article Here

Of course the headline above is a joke.  I just wanted to bring as much attention as I could to the article for those living and/or working in the Philippines.

Overall it’s a great step forward for the country and it is always nice to see international recognition. As much as I hate paying taxes, it is one of the most important steps in fighting corruption and setting up a fair taxation environment that Philippines so desperately needs.

A fair taxation and representation system is a must key step for any future economic growth.  Without any such structure only a small percentage of the overall economy/people will benefit. I wish Kim Henares all the luck she needs.

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A Must Read For Everyone, 

David Stockman writes through The Daily Beast: The End of U.S. Imperium—Finally!

After having rained napalm, white phosphorous, bunker busters, drone missiles, and the most violent machinery of conventional warfare ever assembled upon millions of innocent Vietnamese, Cambodians, Serbs, Somalis, Iraqis, Afghans, Pakistanis, Yemeni, Libyans, and countless more, Washington now presupposes to be in the moral-sanctions business? That’s downright farcical.

Read The Rest Of The Article Here. Highly Recommended.

BusinessWeek Writes: Risk Ahoy: Maersk, Daewoo Build the World’s Biggest Boat

The Triple-E’s capacity is 18,000 TEU. (Most containers today are 40 feet long, so the number carried will be closer to 9,000.) Laid end to end, a single Triple-E’s shipping containers would stretch for 68 miles. “In the late 1990s we were like, ‘Oh my God, a 6,000-TEU ship,’ ” says Peter Shaerf, a managing director at AMA Capital Partners, an investment bank specializing in the maritime industry. “Then you go to 13,000 and now 18,000. I don’t know where it stops.” Practically speaking, a Triple-E, in one trip, could take more than 182 million iPads or 111 million pairs of shoes from Shanghai to Rotterdam. Such a trip would take 25 days and burn 530,000 gallons of fuel. That comes to 0.003 gallons per iPad.

Read the rest of the article here

This is truly a massive ship.  A marvel of engineering, capable of carrying massive amounts of cargo.

However, bare with me for a second as we look at it from another perspective.  I think everyone knows the Skyscraper index analogy by now. Basically, the theory says that when the biggest building in the world is built at any given time or nation it spells the end of prosperity and marks the beginning of rough times ahead.

For example,

• Empire State Building was completed in 1931 or during the darkest hours of the great depression.
• Chicago Sears Towers was completed in 1973 or near the bottom of a severe 1972-74 recession.
• Burj Khalifa in Dubai was completed in 2010 close to what some believe was a cyclical high in oil  prices in 2008.  
• Now China is scheduled to complete the world tallest building “Sky City” in 2014 as it stands close to an economic disaster previously discussed.

So, the question becomes….. Does Triple E simply represent an engineering marvel or does it stand as a symbol of peak in global economic trade (at least for the time being). Let’s see. 

With the US being on the brink of another recession(if not already in one), with no end of economic troubles in Europe, with emerging markets imploding left and right, with China being in a massive speculative and misallocation bubble, I do not see how global trade can increase that much here over the next few years. As such, Triple E might in fact represent the peak in global trade for the time being.  

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Reuters Writes: Robust auto sales keep economy on steady growth path

WASHINGTON (Reuters) – The U.S. economy appears to be faring better in the third quarter than analysts had feared with automakers reporting surprisingly strong August sales on Wednesday, helping to buoy expectations of a pullback in monetary stimulus ahead.

In another report, the Federal Reserve said strong demand for autos helped keep the economy on a “modest to moderate” growth path in recent weeks, an assessment that leaves the door open for a reduction in the central bank’s bond purchases.

Auto sales rose 17 percent last month to a seasonally adjusted annual rate of 16.1 million units. That was the fastest pace since October 2007 and beat the 15.8 million-unit rate analysts surveyed by Reuters had expected.

Auto sales are a key leading indicator of consumer spending, which accounts for about 70 percent of U.S. economic activity.

“We continue to head in the right direction,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania. “With vehicle sales above 16 million (and) a slow but steadily improving job market, the Fed is going to feel comfortable tapering in September.”

AP Writes: US factory orders drop 2.4 percent in July

WASHINGTON (AP) — Orders to U.S. factories fell in July by the sharpest amount in four months, held back by weaker demand for commercial aircraft and heavy machinery. A key category that reflects business investment plans also fell.

Factory orders dropped 2.4 percent in July compared with June, when orders rose 1.6 percent, the Commerce Department reported Thursday.

Orders for core capital goods, a category viewed as a proxy for business investment spending, fell 4 percent in July.

Orders for durable goods, items expected to last at least three years, declined 7.4 percent, a slightly bigger drop than the 7.3 percent fall estimated in a preliminary report last week. It was the biggest decline since a 12.9 percent fall in August 2012. Orders for nondurable goods, items such as chemicals, food and paper, rose 2.4 percent in July after a 0.5 percent decline in June.

Auto sales up, factory orders down. What is going on?  I believe what you are beginning to see and will continue to see over the next few quarters is divergence all over the place. While some sectors will do well, others will be in trouble.

This kind of a behavior is indicative of a major turning point in the markets and the overall economy. Eventually most sectors will turn down, but at least for now as this topping process continues, some will continue to grow. This is confirmed by my stock market work which indicates that the bull run that started in March of 2009 is now over and the market should reverse itself into the 2016 final bear market bottom. Dragging all sectors down in the process.

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Bloomberg Writes: Syria Attack Has China Outraged — at U.S.

As the U.S. prepares for a potential attack on Syria, China is left in the awkward position of reacting to the news and occasionally justifying opposition to any U.S. action.

This is not new. In early 2012, China joined Russia in vetoing a United Nations Security Council draft resolution condemning Syrian violence and supporting an Arab League peace plan. It was a controversial move at the time, and the criticism was so overwhelming that People’s Daily, the Communist Party’s mouthpiece newspaper, felt compelled to editorialize in favor of China’s veto — after the fact.

That move itself was unusual for a government that rarely feels the need to explain itself retroactively. But on Syria, Chinese leaders appeared unusually sensitive to suggestions that they may have been insensitive to an unfolding humanitarian crisis. Referring to the U.S. as “the military giant,” the paper wrote in February 2012:

“Even if it stays for a while, it will not take protecting lives of local civilians as its primary task. The tragedies that have occurred in Iraq and Afghanistan have proved it.

“Using violence to prevent humanitarian disasters sounds just and responsible. However, aren’t the attacks and explosions that have occurred after the regime changes in the two countries humanitarian disasters?”

Read The Rest Of The Article Here

Living outside of the US and watching NBC Nightly News last night, something struck me.  American media is no longer free. I know the media is controlled by corporate interest, but I didn’t realize the extent of the control and the extent of the governmental control until last night.

Basically, half they show they showed dead children followed by crying Syrian men, women and children (of course in some refugee camp) all to a single person saying something to the tune of “America the Great, please help us, you are our only chance for freedom, please defeat Assad, he is killing us, blah, blah, blah”.

What I couldn’t figure out is why there were not able to find one Syrian, not a single Syrian who hates America and/or doesn’t want American intervention.  Wasn’t it just a few years ago there were hundreds of thousands of Syrians in the streets burning American flags and chanting “Death to America”.  And they couldn’t find one Syrian who hates America?  Am I missing something here or did decades of hate turn to love overnight.

You know what this is called? PROPAGANDA.  I grew up in the Soviet Union and I know bullshit when I see it.

Has anyone stopped to ask some questions here.  For example, everyone keeps screaming about ample evidence that Syrian Government was responsible for the gas attack. Apparently there are intercepted phone calls,  direct orders, physical evidence, etc…. Okay, fair enough.  Don’t tell me. Show me. Oh, that’s right, it’s against national security interest to share that information with the American people.

Same song, different day and a different country.  I am sadden by this and what is happening in America.  Another war, another country destroyed, thousands killed. Oh, by the way, here is Senator McCain playing poker  during the Senate hearing in regards to Syria, all while being the number one proponent of going into war. Class act, if you ask me.

As the Bible says “Put your sword back in its place, for all who draw the sword will die by the sword.”

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