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My “Tin Foil Hat” Indicator says “Recession Ahead”

Written by Gary North on January 6, 2012

What is my tin foil hat indicator? The tin foil sales. Well, not tin foil. Aluminum foil.

Alcoa’s profits are plunging. It’s the worst since 2008. The company may even register a 4th-quarter loss.

Net income will tumble 96 percent to 1 cent a share from 21 cents a year earlier, according to the average of 18 analysts’ estimates compiled by Bloomberg. That’s 82 percent less than the average projection from a month ago. Nine of the 12 estimates (AA) compiled within the last 28 days are for New York-based Alcoa to post a loss in the fourth quarter.

Why is this a good indicator? Because aluminum is a primary commodity for final users.

The average price of aluminum, which is used in beverage cans, aircraft and window frames, was 11 percent lower in the quarter from a year earlier after global growth decelerated amid a sovereign-debt crisis in Europe and government action to control inflation in China. Supply is exceeding demand and inventories have soared, leaving some smelters unprofitable at current metal prices.

“You have 40 to 50 percent of global capacity under water at these levels,” Kuni Chen, an analyst with CRT Capital Group LLC in Stamford, Connecticut, who has a “buy” rating on Alcoa, said in an interview.

The companies thought there would be demand. Demand isn’t there. This points to a coming slowdown, despite vaguely positive news.

“The decline in the average of estimates for the fourth quarter of 2011 is the steepest since those made for the fourth quarter of 2008, according to data compiled by Bloomberg.”

It’s not just Alcoa. “Russia’s United Co. Rusal, the world’s biggest aluminum company, will post a 45 percent decline in fourth-quarter earnings, according to estimates compiled by Bloomberg.”

If the experts in the industry guessed this wrong, then there is something more fundamental than excess capacity. It has do do with weak demand.

Continue Reading on www.bloomberg.com

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3 thoughts on “My “Tin Foil Hat” Indicator says “Recession Ahead”

  1. lilbear68 says:

    we already have 25% unemployment if you count the ppl that have run out of benefits and dropped off

  2. They are anticipating a Rejection of the Dollar as World Trade currency , and once that happens the destabilizing effects to USA supply will be a nationalization of the Free market system , civil unrest will be dealt with in this manner .

    In a document originating from Halliburton subsidiary KBR that provides details on a push to outfit FEMA and U.S. Army camps around the United States. Entitled “Project Overview and Anticipated Project Requirements,” http://static.infowars.com/2011/12/i/general/kbr-… , the document describes services KBR is looking to farm out to subcontractors. The document was passed on to us by a state government employee who wishes to remain anonymous for obvious reasons.
    The Global Elite are getting ready for the Dollar to be dumped by the Free market traders and nations like the BRIC to Created the destabilizing effect on the Free market system that then they can Use as the crisis , like Hilary and Rahm talked about in 2009 , http://www.youtube.com/watch?v=Rs6TgitlNIA , http://www.youtube.com/watch?v=B62igfNu-T0 , that they then can come back and React too and Re-establish the NWO of Centralized Government Planning with a Planetary Regime society , like they were trying to do during the times before and between the 2 World Wars of the Last century when that time was the result of Overpopulation demand on a shortage of vital human supply . http://www.prisonplanet.com/the-elites-plan-for-g… , http://www.un.org/esa/dsd/agenda21/

    The some of the same people that are CZARS advising Obama are also on the 2003 Kissinger list of advisers , http://www.hli.org/index.php/kissinger-report/193

    A LIST OF PRESIDENT OBAMA'S MARXIST CZARS http://www.libertynewsonline.com/article_301_2831
    Obama said ,"Judge me by the people with whom I surround myself." http://www.youtube.com/watch?v=5dnPectaYwY&fehttp://www.youtube.com/watch?v=1YzrsNRvYmI&fehttp://www.youtube.com/watch?v=Mid5p_VMJK4
    our father time of Eugenics and you can bet he here to see his Plan come to fruition with the prediction of the NSSM 200 study that is the bases for all we see going on today ; http://www.population-security.org/11-CH3.html . Read this Kissinger statement , http://en.wikiquote.org/wiki/Talk:Henry_Kissinger , Who controls the food supply controls the people; who controls the energy can control whole continents; who controls money can control the world. "Wherever a lessening of population pressures through reduced birth rates can increase the prospects for such stability, population policy becomes relevant to resource supplies and to the economic interests of the United States." , and you do know he was at Obama's last state Dinner along with his Co Founder of the Trilateral Commission Think Tank on POPULATION SECURITY issues , Dr. Zbigniew Brezezinski , , http://thehill.com/capital-living/138999-obama-hu… , and was in the NYSE telling those guys in 2009 Obama is ready for the NEW WORLD ORDER ; http://www.wnd.com/?pageId=85442 , http://www.youtube.com/watch?v=GThfWVCfjVo&fe

    Remember after the 2 World Wars there was Major developments that put in place infrastructures that Expanded Food Production with Electrical Power supply and Irrigation systems for Rapid food production expansion , and as time went on Technology , and especially the 1970s-80s saw Technology increase Food production expansion , but today the hope for future expansion is going to be a lot harder to accomplish because now we need Desalinated Ocean Water to further feed that Demand if Population is allowed to continue to expand and this is the Argument .
    This gives you a Banking breakdown on how the wealth from the private Free markets has been Consolidated to this point of collapse as the WTO Free Trade Policy put that Free Market Investor cash in motion for the Consolidation to happen .
    http://globalresearch.ca/index.php?context=va&amp… , http://www.realecontv.com/videos/europe/goldman-s

    Here is a Breakdown on how that Dollar rejection will effect supply distribution . http://www.youtube.com/watch?v=M0SmVYxrLTE

  3. This is why the USA should have always made sure it was Keeping a basic Manufacturing base of Raw Materials production and able to make maintenance repair parts systems in place so a Independent USA could maintain its basic needs systems in the event international suppliers ever stood together in rejection of the US dollar as World trade currency , then this kind of Leverage would not have formed . But when you are a Globalists with a Ideology about World Population Control , then how to collapse Independent nations sovereignty into a centralized Government would require destabilizing the world trade currency so Independence and self reliance could be controlled for this outcome .
    The Nixon Trade Policy that was stalled by Carter in his term and caused massive Inflation as He tried to tip the USA Free Market System over like Obama is doing today was reversed with the election of Reagan because of a Tech innovation period which ushered in the age of the PC computer and Reagan was then able to further that Trade Policy and dissolve the USA domestic Inflation into the 3rd world Cheaper labor pools . Then in the Early 1990s the trade Policy with the formation of the WTO put this Currency Shift dynamic on Steroids because the Chinese manipulating their currency value Pegging it to the dollar value created the Suction that Ross Perot said would happen in 1991 presidential campaign, http://www.thenation.com/article/new-giant-suckin… , if we implemented that WTO Free trade agreement , see Free floating currency rules were not followed like China and India should have been made to do as Industry was out sourced from Europe and USA values in Asian Currencies should have risen too and par the dollar so Balance trade deficits would be realized , but those Countries Unsustainable population growth forced those nations to peg the currencies to the dollar so that those nations civil populations would stay employed and peaceful , but this is coming to an end as the ability of Feeding and supply the world Population totals are coming to a point that Futures analysis predict these demands will be unsustainable in the next 20 years as is explained in the Kissinger memorandum , of which this latest version of the 2003 summary shows that we are 1 billion people higher 10 years earlier than was anticipated .

    The High Cost of the China-WTO Deal: Administration’s own analysis suggests spiraling deficits, job losses; By Robert E. Scott; February 1, 2000: http://ning.it/cNJn9O
    And http://ning.it/bTIt9f
    It has also taken Mexico\’s Jobs away over the years too. Europe\’s Jobs too. This is all because of a Simple Currency manipulation that does nothing to promote quality in our products.
    Remember what Ross Perot said , we would Hear a Giant Sucking Sound with this Trade Policy , he was right . http://www.thenation.com/article/new-giant-suckin