The Rich People of France are Leaving... for Belgium

I talked about the "Hollande Effect" in a previous article. One of the biggest fears of rich people is the 75% tax on their income once Hollande became president. So what happened the day Hollande became president? A record of 1500 applicants came to Belgium to store their wealth exactly after the French election day, as reported by Dekeyser & Associés. One of those super rich was Gérard Mulliez, boss of Auchan super mart.

This comes to a surprise to me, because Belgium isn't the country with the lowest taxes in Europe..., but rather the highest.

Job Cuts Starting All Over Again

When we had the crash of 2008, we knew that job cuts followed immediately after it. Today, the stock market is rapidly deteriorating with China and India slowing down, American and European banks hitting new lows, European bond yields hitting new highs.

Here are the highlights of the most recent job cuts since 2012 started.

Lufthansa cuts 3500 jobs
HP cuts 30000 jobs
HSBC cuts 3167 UK jobs
Dell set to cuts jobs in the UK
Yahoo cuts 2000 jobs (14%)
Sony cuts 10000 jobs
Credit Suisse could cut 5000 jobs
First Solar cuts 2000 jobs
French banks about to cut thousands of jobs
T-Mobile cuts 1900 jobs
Bank of America cuts 2000 jobs + 400 investment bank jobs
RBS and Lloyds cut 2000 jobs
Allied Irish Banks cuts 2500 jobs
IBM cuts 1790 jobs
Nokia cuts 4000 jobs
American Airlines cuts 13000 jobs
Astrazeneca cuts 7300 jobs
USPS cuts 35000 jobs
PepsiCo cuts 8700 jobs
P&G cuts 5700 jobs
Kraft cuts 1600 jobs
RBS cuts 4800 jobs
Novartis cuts 1960 jobs
NEC cuts 10000 jobs

Food Stamps Hire People

Initial claims in the U.S. were having a very positive trend lately. Today, we have initial claims coming out at 370K, which is a miss of estimates. Will the trend reverse upwards?

Chart 1: Initial Claims

It looks like the trend is positive, but when looking at the food stamps participation rate on Chart 2, it hasn't gone down a bit. Increasingly more Americans are on food stamps. 

Chart 2: Food Stamps Participation

But as Jesse Jackson says: "Food Stamps Hire People", unemployment will decline ever more rapidly.

Capacity utilization rate April 2012 79.2% above estimates

In my previous article I pointed out how important it is to follow the capacity utilization rate to estimate the prices of gold and silver going forward. When the capacity utilization rate plummeted in 2008, we knew for sure that commodities would plunge with it. So what happened recently?

Today the capacity utilization rate for total industry for April 2012 came out at 79.2%, up from 78.4% the previous month (Chart 1). This number is the highest since July 2008 and bodes well for commodity prices, especially gold and silver (which had a very significant correction in the last months). There was a concern the previous month that capacity utilization would come down in April, but it didn't. So gold and silver prices should have significant support in the coming months.

To read the full article, just click on this link: Capacity Utilization Rate in April 2012 Pointing to Inflation.

Chart 1: Capacity Utilization Rate