Today, in a surprising development, via the Telegraph we learn that none other than the same Bundesbank which is causing endless nightmares for all the other broke European nations due to its insistence for sound money, decided to voluntarily pull two thirds of its gold holdings held by the Bank of England. According to a confidential report referenced by the Telegraph, Buba reclaimed 940 tons, reducing its BOE holdings from 1,440 in 2000 to 500 in 2001 allegedly “because storage costs were too high.”

h/t Adrian

How deep is the economic hole? The Greek statistics agency EL.STAT is reporting that the 2011 deficit stood at 9.4 percent of GDP and the public debt at a staggering 170.6 percent. Greece is begging the EU and IMF to release the latest tranche of aid—a staggering 31.2 billion euros ($39.7 billion). Forget trite talk of Greeks losing only their feather-bedded pensions and early retirement. The cuts are deep, the pain real, and the anger white-hot.

Via

In contrast with best industry practices ….

Germany’s gold reserves do not seem to be independently verified by a third party.
Philipp Missfelder, a politician from Merkel’s own party, has asked the Bundesbank for the right to view the gold bars in Paris and London, but the central bank has denied the request, citing the lack of visitor rooms in those facilities, German’s daily Bild reported. The Bundesbank won’t let German parliament members inspect the German gold vaulted abroad because the central bank vaulting facilities supposedly lack “visiting rooms.” And yet one of those vaults, the Federal Reserve Bank of New York, offers the public tours that include “an exclusive visit to the gold vault”.

h/t Adrian

Caterpillar Inc., the world’s largest maker of construction and mining equipment, forecast sales growth for 2013 that is the slowest in four years as the global economy decelerates.

h/t Kevin B

A single algorithm …

…last week placed and cancelled orders on the Nasdaq accounting for 4% of all quoted traffic in the US. Not only this, it also accounted for a colossal 10% of the bandwidth that is allowed for trading on any given day.
It placed orders in 25-millisecond bursts, involving approximately 500 stocks, but never actually executed a single trade.
The algorithm’s stopped operating at 10.30am ET on Friday.

h/t syncrodox

Fedex to cut thousands from workforce.

Headaches? That’s it, we’re going back to Ethernet.

Financial Post;

With virtually no warning, the iron ore price fell off a cliff in August, plummeting about 30%. It was below US$85 a tonne by early September, compared with almost US$200 a tonne in 2010.
It was due to events in China, where iron ore demand vanished overnight as steelmakers went on a buyer’s strike and liquidated their inventories. This was the first major blow to the iron-ore market since the 2008 financial crisis, and it provided a hint of what a prolonged Chinese slowdown could mean for this sector.

h/t Kevin B

Business Week;

Baoshan Iron & Steel Co. (600019), China’s largest listed steelmaker, suspended production at a plant after demand fell for slabs used to make ships and bridges.

h/t PeterJ

Maxed Out Mama;

The big weakness is in planes, but a drop of 13.2% in durable orders is shockingly bad. Ex-transportation new orders decreased 1.6%. Shipments dropped 3%; ex-transportation shipments dropped 0.9%. I wouldn’t recommend reading this thing – the string of minus signs burns out your eyeballs.

FedEx on Tuesday cut its outlook for global growth and industrial production while slashing the forecast for company earnings. And CEO Fred Smith suggested trade has slowed to levels seen during the last two significant economic downturns.

h/t Don

AP:

A jeweler in metro Atlanta is adding some bang to the bling.
Under a new promotion, customers who buy a diamond worth $2,499 or more from D. Geller and Son will get a voucher for a free hunting rifle.

Via

Financial Times;

Last week Oleg Deripaska revealed his concern over the financialisation of physical aluminium. He called for output cuts, effectively to take the place of funded “dark” inventory, in order to bring the market back to equilibrium.
Then Reuters reported at the weekend that Chinese banks and companies –which had tried to seize commodity collateral which had been pledged for loans, now defaulted upon — had found the metal in question never existed.

But read it all. (h/t Melinda Romanoff)

Will The Baltic Dry Bounce Off Satan’s Bottom?

Unregulated banks making loans on invisible inventory and now what inventory they did have isn’t moving.

Steel sector companies have found themselves particularly vulnerable as economic growth slows in China because many played games with credit lines, bank loans, inventory collateralization and multi-company borrowing schemes.
Some steel manufacturers and trading firms used product inventories as collateral for bank loans, then increased their money in hand by convincing another bank to exchange the lenders’ acceptance bills for cash.

h/t: maz2

In July, Spaniards withdrew a record 75 billion euros, or $94 billion, from their banks — an amount equal to 7 percent of the country’s overall economic output …

Via Drudge, where there’s more.

Iran, North Korea sign technology agreement (h/t Kevin)

Yeah, it seems as paranoid and nuts as it did when it was said about Bush, but this stuff is not being said in an extremist corner of the internet — it’s being said in a middle-class suburban salon in an area where 30% (or more) of the businesses are now shuttered, and houses are being foreclosed upon and then re-occupied seemingly overnight, creating what the stylist called “a neighborhood full of changes and no hope. Forget about new small businesses,” he said, gesturing across the street, where a small food shop’s “opening soon” banner had become sun-faded and worn, even as the door remained locked. “That guy is never going to open.”
“I can’t get a loan,” the woman in the next chair told me. “I want to consolidate my kid’s college loans into one loan, and the credit union says they don’t give loans to consolidate student loans. I told them, I have job-security and excellent credit — what if I just want a loan for myself, a personal loan?” She was in high dudgeon and her voice grew louder in a perfect arc of Long Island umbrage-taking. “They said they’d need to know what it was for. I said, ‘it’s my personal business what the loan is for! Maybe I want to go on vacation, throw a wedding, pay off college loans, why do you have to know?’, and they said, no, they had to know what the money was for, because they’d be paying it out for me — like I’m a child who can’t be trusted with money! So, I figure, okay, it’s a credit union, I’ll try my bank. They said they don’t make personal loans anymore! It shook me up. I felt like maybe I didn’t realize how bad things are.”