This is an invitation by Pastor Lindsey Williams taken from the DVD ‘Elite Plans For 2016‘. Lindsey Williams, an ordained Baptist minister went to Alaska in 1970 as a missionary. For three years Pastor Lindsey Williams had the opportunity to sit, live and rub shoulders with the most powerful, controlling and manipulative men on the face of this planet.
PLEASE SHARE PASTOR WILLIAMS MESSAGE TO EVERYONE YOU KNOW!
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- Who will be the next president of the U.S.?
Why no financial collapse in 2015?
Hear from someone in contact with the Elite.
Five firearms every American should own.
Is war inevitable?
Pastor Lindsey Williams
Author of The Energy Non-Crisis
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This is your best DVD Ever! Extremely informative & I appreciate you answering many of our questions in the DVD, for those who have followed you over the years. Your son did a great job in his presentation on firearms.
I have followed you for years & have continued to purchase your DVD’s through Prophecy Club… My wife & I are very grateful to you, for information you have shared with the world.
We have done all the things you have suggested & we are at peace. We are both followers of Jesus Christ, our LORD and Savior!
God Bless You & Your Family,
Michael & DeAnna
I just received LW’s latest DVD on 2016, and it is riveting. As a born again Christian believer, who also believes in the pre-Tribulation rapture, it is very heartening to hear any preacher these days present a good old-fashioned Gospel message and belief in the rapture. I really felt this DVD was more like a “left behind” DVD, as none of us (nor God Himself) can force people to believe; one must accept the Truth by free will.
Thank you for considering,
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Over 20+ Presentations Detailing 40 Years
Exposing The Elites Plan for Humanity and this Planet!
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Over 46 Hours of Content Now Available to Watch & Listen To Instantly On Your Computer, Laptop, Tablet or Mobile Phone.
Every DVD and Presentation Produced by Pastor Lindsey Williams until the end of 2014 now available to view online, including: Exclusive content only available online at LindseyWilliamsOnline.com, content available without advertisements in Digital Streaming format and content Digitally Remastered from Original Recordings!
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Special Events Scheduled for 2015, 2015 – Elite Agenda, Global Currency Reset, Elite Emergency Data, Healing the Elite Way, New Signs of the Elite, The Next 4 Years & How to Survive the Next Four Years, Secrets of the Elite, 2012 The Beginning of the End, Middle East: The Rest of the Story, The Elite Speak, Tragedy/Hope/Reality, Confessions of an Elitist, Jonathan May Economic Hitman, Torn from the Land, Are They Worth the Risk Immunizations/Vaccinations, Deadly Diseases and Microbial Mutations, 3 Different Versions of The Energy Non-Crisis Presentation. All Included!
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GLOBAL CURRENCY RESET
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The greatest event in the financial world in the past 1,000 years is about to take place. Two hundred and four nations have agreed with the IMF (International Monetary Fund) to reset their currency. Christine Lagarde is the new financial head of the IMF. If she and the Elite have their way, this event will take place within the next ninety days (three months).
The Elite have prepared you for this event with an Electric Smart Meter which has been installed on almost every house in America. Only from my Elite friend will you ever know what has been done to you. Only in my new DVD will you learn these details. No one else will dare to tell you this.
Time is no longer on your side. Its time to take action and protect yourself today. You can order “Global Currency Reset” from Prophecy Club.
Pastor Lindsey Williams
Author of The Energy Non-Crisis
You must know what a
GLOBAL CURRENCY RESET
is and take immediate precautions
Two hours of explanation
GLOBAL CURRENCY RESET
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Pastor Lindsey Williams has confirmed that there will be be a worldwide economic and financial crash slated for 2015 after the Patient Protection and Affordable Care Act (HR 3590) is fully enacted. The act is not a healthcare bill but works hand in glove with the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001 (HR 3162) for total control of the USA and ultimately the world in one swift move. The word is control and their ultimate goal is to enslave the entire population of the planet. The plan is so ingenious and simple it’s incredible. This is not a theory, this is the truth and verified by the very highest echelons of the elite. The crash must happen, the economies of the world are already on a knife-edge one piece of bad news and it will come crashing down taking all the banks, investment banks and pension funds with it. Chaos will reign and out of the chaos order will come. It is taking place so the elite can come to the rescue and that will see the initiation of the new world government and the debasement of the US Dollar. The crash that is coming will make 2008 look like a minor financial correction. Imagine all companies, all businesses, all mortgages all owned by the elite. Its a very real threat and you only have a short window in order to protect yourself from it. This is why I have taken Pastor Lindsey Williams steps to avoid the crash as he shared in his new DVD “Elite Emergency Data” and expanded them into an extensive article to hopefully explain what is happening, why and how you can protect your family from it, even prosper from it…
I have outlined the 10 Steps To Avoid The Crash in several sections to make it easier to digest, please read it all and follow the steps as best you can:
- INTRODUCTION: 10 steps to avoid the crash.
- PART 1: Buy every piece of gold you can lay your hands on.
- PART 2: You have to get out of debt.
- PART 3: Get out of paper.
- PART 4: Pay off your house mortgage.
- PART 5: Store food, water and firearms.
- PART 6: Get ready for the biggest buying opportunity of your lifetime.
- PART 7: Get out of the city.
- PART 8: Purchase everything you need.
- PART 9: Sort out your medicine cabinet.
- PART 10: Get your spiritual house in order.
- CONCLUSION: 10 steps to avoid the crash – conclusion.
Once you have carried out these 10 steps you will be better able to survive, even thrive through the coming collapse. Of course a lot of people’s situations do not permit them to carry out all the steps, just do as much as you can. Being prepared for the worst is the best protection. Please share the articles with as many people as you can, because everyone needs to know what has been planned for them by the elite.
Please do not take the article lightly and do not take it at face value. Please do your own research and if you have a differing opinion, please share it.
I have also created the entire 10 Steps To Avoid The Crash article into a 100 page illustrated PDF E-Book. Please download and share it freely. Download the e-book here.
ELITE EMERGENCY DATA
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I promised you, that when my elite friend told me the time for the crash to take place, that I would tell you!
My Elite friend has told me when the collapse of the banks and the crash of the dollar will take place.
There are TWO other collapse which you must know about that will affect you and your family more than the collapse of the dollar.
A few weeks from now I may or I may not appear on radio shows with this information.
It is imperative for you to get this information now before its too late. You can order “Elite Emergency Data” from Prophecy Club.
Pastor Lindsey Williams
Author of The Energy Non-Crisis
ELITE EMERGENCY DATA
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AFTER you have viewed the new DVD “Elite Emergency Data” Please read the report by Attorney Connelly and you will understand why the Health Care Bill is related to the Total Financial Collapse – Chaplain Lindsey Williams
The Truth About the Health Care Bills – Michael Connelly, Ret. Constitutional Attorney
To begin with, much of what has been said about the law and its implications is in fact true, despite what the Democrats and the media are saying. The law does provide for rationing of health care, particularly where senior citizens and other classes of citizens are involved, free health care for illegal immigrants, free abortion services, and probably forced participation in abortions by members of the medical profession.
The Bill will also eventually force private insurance companies out of business, and put everyone into a government run system. All decisions about personal health care will ultimately be made by federal bureaucrats, and most of them will not be health care professionals. Hospital admissions, payments to physicians, and allocations of necessary medical devices will be strictly controlled by the government.
However, as scary as all of that is, it just scratches the surface. In fact, I have concluded that this legislation really has no intention of providing affordable health care choices. Instead it is a convenient cover for the most massive transfer of power to the Executive Branch of government that has ever occurred, or even been contemplated. If this law or a similar one is adopted, major portions of the Constitution of the United States will effectively have been destroyed.
The first thing to go will be the masterfully crafted balance of power between the Executive, Legislative, and Judicial branches of the U.S. Government. The Congress will be transferring to the Obama Administration authority in a number of different areas over the lives of the American people, and the businesses they own.
The irony is that the Congress doesn’t have any authority to legislate in most of those areas to begin with! I defy anyone to read the text of the U.S. Constitution and find any authority granted to the members of Congress to regulate health care.
This legislation also provides for access, by the appointees of the Obama administration, in direct violation of the specific provisions of the 4th Amendment to the Constitution, of all of your personal healthcare information, your personal financial information, and the information of your employer, physician, and hospital. All of this is a protecting against unreasonable searches and seizures. You can also forget about the right to privacy. That will have been legislated into oblivion regardless of what the 3rd and 4th Amendments may provide.
If you decide not to have healthcare insurance, or if you have private insurance that is not deemed acceptable to the Health Choices Administrator appointed by Obama, there will be a tax imposed on you. It is called a tax instead of a fine because of the intent to avoid application of the due process clause of the 5th Amendment. However , that doesn’t work because since there is nothing in the law that allows you to contest or appeal the imposition of the tax, it is definitely depriving someone of property without the due process of law.
So, there are three of those pesky amendments that the far left hate so much, out the original ten in the Bill of Rights, that are effectively nullified by this law. It doesn’t stop there though.
The 9th Amendment that provides: The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people;
The 10th Amendment states: The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are preserved to the States respectively, or to the people. Under the provisions of this piece of Congressional handiwork neither the people nor the states are going to have any rights or powers at all in many areas that once were theirs to control.
I could write many more pages about this legislation, but I think you get the idea.
This is not about health care; it is about seizing power and limiting rights. Article 6 of the Constitution requires the members of both houses of Congress to “be bound by oath or affirmation to support the Constitution.” If I was a member of Congress I would not be able to vote for this legislation or anything like it, without feeling I was violating that sacred oath or affirmation. If I voted for it anyway, I would hope the American people would hold me accountable.
For those who might doubt the nature of this threat, I suggest they consult the source, the US Constitution, and Bill of Rights. There you can see exactly what we are about to have taken from us.
Michael Connelly (First published in June 2012)
Constitutional Law Instructor
AFTER HAVING READ THIS, PLEASE SHARE…
WE MUST HOLD CONGRESS ACCOUNTABLE BEFORE IT IS TOO LATE!
If you have not yet obtained a copy of Pastor Lindsey Williams’ new DVD “Elite Emergency Data” you can obtain one from Prophecy Club.
HEALING THE ELITE WAY
New DVD From Lindsey Williams
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“The Most Important DVD I Have Ever Made!
It Saved My Life!
This DVD May Save Your Life!”
Pastor Lindsey Williams
Think About It –
No President of the United States has ever died from Cancer.
– Why? What do they know that you don’t know?
President Ronald Reagan was diagnosed with Colon Cancer while he was President. He imported a substance that was illegal to be used in the United States at that time. He never had a reoccurrence.
There is no reason to suffer from –
- Heart Disease
- Chronic Fatigue Syndrome
- Multiple Sclerosis
- Hepatitis C
- Hormonal Imbalance
- Vascular Disease
- Immunological Imbalance
“The Elite know how to be healed – I have been told some of their secrets. Thus, this DVD, Healing the Elite Way.” – Lindsey Williams
Author of The Energy Non-Crisis
HEALING THE ELITE WAY
New DVD From Lindsey Williams
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Lindsey Williams, an ordained Baptist minister went to Alaska in 1970 as a missionary. While in Alaska, Pastor Williams found out about the Trans-Alaska oil pipeline, which began construction on 29th April 1974. Because of Pastor Williams’ love for the USA and concern for the spiritual welfare of the over 25,000 workers on the pipeline, he volunteered to serve as Chaplain on the pipeline, with the full support of the Alyeska Pipeline Company.
Pastor Williams was given the northern 7 out of the 28 construction camps including the oil field at Prudhoe Bay to hold worship services at the 7 camps once a day. After six months a PR employee at Alyeska Pipeline Company told Pastor Lindsey Williams that he was an invaluable asset to the company. He said that Lindsey was saving the oil pipeline company thousands of dollars of counselling fees and had voted successfully to give Pastor Williams executive status if he wished to accept it. Executive status meant that Lindsey Williams could go anywhere he liked and see anything he wanted regarding the pipeline operation. They gave him a vehicle and an executive pass and he was also invited to sit in on board meetings in an advisory capacity in order to help the relationship between management and labour.
For three years Pastor Lindsey Williams had the opportunity to sit, live and rub shoulders with the most powerful, controlling and manipulative men on the face of this planet.
The site I have created will document what happened to Pastor Lindsey Williams during his time as chaplain to the Alyeska Pipeline Company and what has happened subsequently regarding the elite’s plan for control of the world and its resources.
Lindsey Williams gives the most important message you will ever hear…
The Bible says there is only one way to Heaven:
Jesus said: “I am the way, the truth, and the life: no man cometh unto the Father but by me.” (John 14:6)
Good works cannot save you.
“For by grace are ye saved through faith; and that not of yourselves: it is the gift of God: Not of works, lest any man should boast.” (Ephesians 2:8-9)
Trust Jesus Christ today! Here’s what you must do:
Admit you are a sinner.
“For all have sinned, and come short of the glory of God;” (Romans 3:23)
“Wherefore, as by one man sin entered into the world, and death by sin; and so death passed upon all men, for that all have sinned:” (Romans 5:12)
“If we say that we have not sinned, we make him a liar, and his word is not in us.” (1 John 1:10)
Be willing to turn from sin (repent).
Jesus said: “I tell you, Nay: but, except ye repent, ye shall all likewise perish.” (Luke 13:5)
Believe that Jesus Christ died for you, was buried, and rose from the dead.
“For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” (John 3:16)
“But God commendeth his love toward us, in that, while we were yet sinners. Christ died for us.” (Romans 5:8)
“That if thou shalt confess with thy mouth the Lord Jesus, and shalt believe in thine heart that God hath raised him from the dead, thou shalt be saved.” (Romans 10:9)
Through prayer, invite Jesus into your life to become your personal Saviour.
“For with the heart man believeth unto righteousness; and with the mouth confession is made unto salvation.” (Romans 10:10)
“For whosoever shall call upon the name of the Lord shall be saved.” (Romans 10:13)
What to pray:
Dear God, I am a sinner and need forgiveness. I believe that Jesus Christ shed His precious blood and died for my sin. I am willing to turn from sin. I now invite Christ to come into my heart and life as my personal Saviour.
Pastor Lindsey Williams will be at the IBC Hospital & Health Center in Tijuana, Mexico under the care of Rodrigo Rodriguez MD, Medical Director as a part of his “Tune Up” from 3rd March 2013.
From March 11, 2013 through March 15, 2013 Pastor Williams will be holding a number of radio shows with Dr. Rodriguez to discuss that doctors all over America are closing their offices and leaving the medical profession because of the new healthcare system beginning January 1, 2013. Pastor Williams and Dr. Rodriguez will be discussing this and more information relating to the elite and their plan for humanity and this planet including where the elite go for their healthcare needs including treatments available at International Bio Care Hospital & Medical Center in Tijuana, Mexico.
For further information relating to IBC Hospital & Health Center please call: 1-800-701-7345
From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. Please LIKE the Lindsey Williams Online Facebook Page to see stories posted daily regarding the current state of the economy around the world.
Latest News From April 29, 2016 to May 19, 2016:
- 50-Year Veteran Warns A Massive Reset Of The World Financial System Is Coming
With the U.S. dollar continuing to trade near recent lows and gold trading near $1,240, today a 50-year market veteran warned King World News that a massive reset of the world financial system is coming. John Embry: “Eric, just when you think things can’t become any more artificial or ludicrous, Bloomberg comes out with a report that the Japanese central bank, by virtue of its month-to-month purchases of Japanese stock ETFs, is now a top ten holder in approximately 90 percent of the Japanese companies that make up the Nikkei 225 Index…
- ALERT: Legend Warns A Day Of Reckoning Is Coming And The Global Collapse Will Be Absolutely Terrifying
After a wild start to the 2016 trading year, today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events, just warned a day or reckoning is coming and the global collapse will be absolutely terrifying. Egon von Greyerz: “Investors around the world are blissfully ignorant of what will hit them in the coming months and years. Virtually no one understands the risks in the world, and less than 0.5% of investors have protected themselves against the destruction of their financial assets…
- Saudi Arabia US Friction, Economic Update, China Gold Fix and Fraud Ignored by MSM
The President was in Saudi Arabia in what the White House claims was a trip to “clear the air.” I really don’t know how you clear the air with the friction between the U.S. and the Kingdom. There is ISIS, which the Saudis are funding along with the U.S, but that’s changing because it appears the U.S. is increasing its attacks on ISIS. There is the bi-partisan Senate bill that will release the missing 28 pages of the 9/11 Commission Report that supposedly implicates Saudi Arabia. It will also allow the families if the 9/11 attack to sue Saudi Arabia if it was involved. The Saudis said they would dump a trillion dollars in U.S. assets if that becomes law. President Obama says he will veto. The House and Senate may have enough votes in this election year to override that veto as big time people in both parties are pushing this. The President is also basically telling Arab allies in the Middle East that they should learn how to share the region with Iran. So, I really do not know how they can “clear the air” with zero resolutions.
- A Bird’s-Eye View Of How The US Economy Is Falling Apart (In 4 Simple Charts)
My college-aged kids love him. I’m not talking about Stephen Curry or Justin Bieber (although they love them too); I’m talking about Bernie Sanders. Whether you support him or not, my guess is that most Americans my age are very surprised about his popularity. However, it shouldn’t be a surprise given the economic stress many Americans face. Sadly, roughly 50 million Americans live below the poverty line—the largest number in our nation’s history—and the poorest 40% of all Americans now spend more than 50% of their incomes just on food and housing.
- “We Haven’t Seen This Is In Our Lifetimes” – CEO Says “Alberta Is In A Depression”
Regular readers know that we’ve covered Alberta’s decline at length (refresher here), so there is no need to give much of a backstory other than to say that the situation seems to get worse for the Canadian province as each day passes even as oil has rebounded in the past two months. Toronto’s “Condo King” Brad Lamb tried to put things into context when he said the situation is “worse than 2008.” However, on Friday we received an even more gloomy (albeit realistic) description of the economic situation in Canada’s energy hub, Alberta. In a very blunt interview with BNN, Murray Mullen the CEO of trucking company Mullen Group, said that the situation has moved well past recession, and should be described as a depression.
- Despite Record Liquidity, Chinese Repo Rates Are Rising Again
As out friends from Fasanara Capital remind us, despite record liquidity injections by the PBOC in the past few days, Chinese repo rates have resumed continue breaking higher. The move is odd, given ongoing record liquidity injections (RMB 680 bn last week, RMB 150 bn today). As Fasanara’s Francesco Filia writes, “the mind inevitably goes to excess credit troubles in China and potential for CNH selling-off” and adds that the “move directly affects leveraged positions on bonds, funded by short-term repos.” While so far, the currency and the SHCOMP remain stable, it is a notable trend to watch.
- Saudi Arabia agrees plans to move away from oil profits
The Saudi cabinet has approved sweeping economic reforms aimed at moving the country away from its dependence on oil profits. Just over 70% of revenues came from oil last year but it has been hit by falling prices. One part of the plan will see shares sold in state-owned oil giant Aramco to create a sovereign wealth fund. Announcing the reforms, Deputy Crown Prince Mohammed bin Salman described his country as being addicted to oil.
- Greece bailout talks make ‘progress’
Eurozone finance ministers say they have made progress in talks about the bailout programme for Greece. But they said after a meeting in Amsterdam on Friday that further work was still needed. They said they are hopeful that an agreement can reached in the next few days and are ready to call an extraordinary meeting. That would pave the way for the next payment under the bailout. It’s a familiar pattern.
- Morgan Stanley’s profit more than halved as trading slumps
Morgan Stanley’s quarterly profit fell by more than half as the Wall Street bank’s fixed-income trading and investment banking businesses took a hit from market volatility early in the year. But the earnings still handily beat expectations as the bank slashed employee compensation, helping to push up its shares 2.5 per cent in premarket trading on Monday. Sliding commodity and oil prices, worries about the Chinese economy and uncertainty about U.S. interest rates made for wobbly markets in January and February, scaring off traders, investors and companies hoping to list on stock exchanges.
- Citigroup profit plunges 27% as trading revenue falls
Citigroup Inc’s quarterly profit plunged 27 percent as its trading revenue fell and its costs related to shrinking some businesses rose. The profit decline is the biggest among big U.S. banks that have reported first-quarter results so far, but Citigroup’s earnings and revenue beat Wall Street’s low expectations, helped by a fall in operating expenses. Shares of the No.4 U.S. bank by assets were up more than 2 percent in premarket trading on Friday. Banks globally have had a tough start to the year amid near-zero interest rates, a slowdown in China and low oil prices.
- Bank of America profit slides 18% as trading activity weakens
Bank of America Corp, the No. 2 U.S. bank by assets, reported an 18 per cent slide in quarterly profit as concerns about a global economic slowdown and uncertainty about the pace of U.S. interest rate increases dampened bond and stock trading. Net income attributable to common shareholders fell to US$2.22-billion, or 21 cents per share, in the three months ended March 31, from $2.72-billion, or 25 cents per share, a year earlier. Analysts on average had expected earnings of 20 cents per share, according to Thomson Reuters I/B/E/S. It was not immediately clear if the figures reported on Thursday were comparable.
- Gerald Celente – The Dream Is Dying As Americans Now Consume 80% Of Global Painkillers
While politicians lie, the numbers don’t. On the economic front, according to The Pew Research Center, “Americans are less well-to-do now than at the start of the 21st century. For all income tiers, median incomes in 2014 were lower than in 2000. These reversals are the result of two recessions – the downturn in 2001 and the Great Recession of 2007-09 – and economic recoveries that have been too anemic to fully repair the damage.” Once the “land of opportunity,” the gap between the rich and poor in America is the widest among all the developed nations. A report by the University of Michigan illustrates the Gilded Age wealth inequality that now prevails. The median American household was 13.6 times poorer than an average household in the 95th percentile in 2003. By 2013, the average household in the 95th percentile (top 5 percent) was 24.2 times richer than the median household and 426.5 times richer than the average household in the 25th percentile.
- Venezuela introduces two-day week to deal with energy crisis
Venezuela’s government has imposed a two-day working week for public sector workers as a temporary measure to help it overcome a serious energy crisis. Vice-President Aristobulo Isturiz announced that civil servants should turn up for work only on Mondays and Tuesdays until the crisis was over. Venezuela is facing a major drought, which has dramatically reduced water levels at its main hydroelectric dam. But the opposition has accused the government of mismanaging the crisis. The measures announced on national television by Mr Isturiz affect two million public sector workers. “There will be no work in the public sector on Wednesdays, Thursdays and Fridays, except for fundamental and necessary tasks,” he said.
- Durable goods orders were weaker than expected in March
Durable goods orders rose 0.8% in March, according to preliminary data from the Department of Commerce. Excluding transportation, orders fell 0.2%. Economists had forecast that orders for goods built to last rose 1.9%, according to Bloomberg. Excluding transportation orders, they forecast a 0.5% rise.
- Atlanta Fed Boosts GDP Forecast Following Today’s Durable Goods Miss And Downward Revision
If there was some confusion why the Atlanta Fed recently revised its GDP Nowcast higher following the recent retail sales miss, that confusion will be even more acute today when moments ago the Atlanta Fed plugged today’s weaker than expected durable goods print (and downward revision to past month’s data), and ended up with… a GDP forecast that was higher than previously, or an increase from 0.3% to 0.4%.
- New York City Millennials Make Less, Have More Debt
Millennials in New York City earn about 20% less than the previous generation of young workers and are likely to struggle for years from the effects of the late-2000s recession, according to a report from city Comptroller Scott Stringer. The report found the recession saddled people who were born from 1985 to 1996 with greater debt than their parent and given them fewer high-wage job opportunities even as the cost of housing in the city has risen. “Millennials were applying for jobs in the most difficult economic climate since the Great Depression,” Mr. Stringer said in his report, which was set to be released late Monday. “Every generation is expected to do better than the last, but too many millennials are not getting a fair chance to make it here in New York City.”
- Twitter plummets 14% on revenue, outlook miss
Wall Street’s view of Twitter can be summed up in far fewer than 140 characters: Too little growth. Twitter shares plunged more than 14% Wednesday after the social media company released financial results after the bell Tuesday. Revenue came in lighter than analysts had forecast and second-quarter revenue guidance fell far short of expectations. Making matters even worse for the beleaguered company, user growth only crept up. The first-quarter triple whammy raised fresh concerns that Twitter will fall even farther behind market leaders Facebook and Google in attracting digital advertising dollars. In a tweet, Twitter acknowledged that “brand marketers did not increase spend as quickly as expected” in the first quarter.
- James Rickards Says Yellen Has Gone “Full-Dove;” Won’t Raise Interest Rates
With the Federal Reserve preparing for another meeting, pundits are talking interest rate hikes. Even AP is speculating that a rate hike is unlikely this go-around, blaming problems the “global economy.”The US job market is healthy. The stock market is up. Home prices are rising. Yet as the Federal Reserve prepares to meet this week, it seems in no mood to resume raising interest rates from ultra-lows. With the global economy struggling and US inflation still below the Fed’s target rate, many economists see little likelihood of a rate increase even before the second half of the year.”
- Britain’s property market is going to implode as housing nears peak affordability
Property prices in Britain may be surging due to a horrendous imbalance of supply and demand — but the market is poised to implode. Why? Because Britons are not earning enough money to either get on the housing ladder or are spending such a large portion of their wages on mortgages that may not be sustainable. Well, not unless everyone suddenly gets a huge pay rise over the next year or so. That’s the assumption in the latest figures from think tank Resolution Foundation, which show that lower- and middle-income households are spending 26% of their salaries on housing, compared to 18% back in 1995. In London, households spend 28% of their income on housing.
- Venezuela Doesn’t Have Enough Money to Pay for Its Money
Venezuela’s epic shortages are nothing new at this point. No diapers or car parts or aspirin — it’s all been well documented. But now the country is at risk of running out of money itself. In a tale that highlights the chaos of unbridled inflation, Venezuela is scrambling to print new bills fast enough to keep up with the torrid pace of price increases. Most of the cash, like nearly everything else in the oil-exporting country, is imported. And with hard currency reserves sinking to critically low levels, the central bank is doling out payments so slowly to foreign providers that they are foregoing further business. Venezuela, in other words, is now so broke that it may not have enough money to pay for its money.
- Why Sports Authority is throwing in the towel and closing all of its stores
When struggling retailer Sports Authority filed for Chapter 11 bankruptcy last month in the face of more than $1 billion in debt, the company indicated that it had two options going forward. One of those was to shed under performing stores and emerge from bankruptcy as an intact, but pared-down company. The other was to sell everything and cease operating. On Tuesday, the company appeared to choose the latter.
- Suicides Up as Jobs Dry Up
Middle-aged people laid off and unable to find work are taking another way out. They’re killing themselves. Suicide rates are soaring, according to federal data released last week. Especially in economically depressed states and job-starved regions like upstate New York. People in need of work are twice as likely to take their own lives as employed people, and people fired in their 40s and 50s find it hardest to get hired again. That makes boosting economic growth a life-and-death issue. But you wouldn’t know it listening to Barack Obama and Hillary Clinton. President Obama whitewashes reality, claiming the “American economy is pretty darn good right now.”
- UK Better Off Outside EU, Economists Say
The UK economy would be about 4% bigger 10 years after leaving the European Union than if it stayed in, according to a group of leading economists who support an exit. A pamphlet published by the eight “Economists for Brexit” set out a series of arguments on the benefits of voting to leave in the referendum on 23 June. They include the claim that lower tariffs on imports from outside the bloc will boost UK consumer spending sharply. It is also argued that EU regulation holds back growth and that without this, jobs and investment will flourish. The pamphlet also argues the UK could better spend its contribution to the EU budget elsewhere, and also that there would be more control over the mix of skills brought by immigrants.
- US to paint new pictures on its dying, barbarous relic of a currency
In a letter to the American tax slaves, US Treasury Secretary Jacob Lew “the Loon” has presented his plan to replace some of the images on the dwindling $20, $10 and $5 Federal Reserve Notes. Slave emancipator, Harriet Tubman, will replace Andrew Jackson on the $20, leaders of the suffrage movement will go on the $10 and images of the Lincoln Memorial will go on the $5. You’d think with the US government being $19 trillion in debt they’d have bigger priorities than artwork. The US can’t pay what it owes any more than its indebted citizens can. Something like 50 million are on food stamps and most of the rest don’t have a dollar in the bank to tide them over once things get worse. And they will. Just wait until the dollar crashes for good.
- Carl Icahn says he sold entire Apple stake on China woes: CNBC
Billionaire activist investor Carl Icahn said today he had sold his entire stake in Apple Inc, citing the risk of China’s influence on the stock. Icahn, in an interview with cable television network CNBC, also said he was “still very cautious” on the US stock market and there would be a “day of reckoning” unless there was some sort of fiscal stimulus. Icahn had been a huge cheerleader of Apple, acquiring a stake in the company almost three years ago, repeatedly calling the investment a “no brainer.” In an open letter to Apple Chief Executive Officer Tim Cook in May 2015, Icahn had argued that shares of the iPhone maker were worth $240, about 90 percent more than they had been trading. At $240 a share, Apple’s market cap would be $1.4 trillion, Icahn asserted.
- End of Golden Era for Investors Spells Troubles for Millennials
Turning 30 just got a lot scarier. A coming collapse in investment returns means that people that age today will have to work seven years longer or save almost twice as much to end up with the same nest egg as those of roughly a generation ago. So says the research arm of McKinsey & Co. in a new report that argues that investors of all ages need to resign themselves to diminished gains. The consulting company maintains that the last 30 years have been a “golden era” of exceptional inflation-adjusted returns thanks to a confluence of factors that won’t be repeated. They include falling inflation and interest rates, swelling corporate profits and an expanding price-earnings ratio in the stock market.
- Federal Reserve Leaves Door Open for June Rate Increase
Federal Reserve policy makers left open the door to raising interest rates in June by nodding to improvement in global financial markets and downplaying recent weakness in the U.S. economy. The Federal Open Market Committee omitted previous language that “global economic and financial developments continue to pose risks,” instead saying officials will “closely monitor” the world situation, according to a statement released Wednesday following a two-day meeting in Washington. The Fed left its benchmark interest rate unchanged. “Their removal of the line on risks is pretty significant,” said Carl Tannenbaum, chief economist at Northern Trust Corp. in Chicago and a former Fed official. “That might reflect increased comfort on the committee that global influences appear more manageable.”
- Danger Signs in the World’s Top Housing Market
At first glance, the world’s best-performing housing market bears few of the usual hallmarks of a bubble about to pop. Reliance on mortgages is low, and Turkish homeowners reliably repay their loans, helped by house prices that rose faster than in any other country last year. The risk, at a time when construction has grown to make up a bigger share of the country’s investments than in China, is with the builders rather than the buyers. The share of Turkey’s borrowing represented by developers is higher than at any time in the last decade, and represents almost a fifth of all corporate loans, according to the nation’s banking association. An increasing portion of those debts is going bad, with the industry’s portion of non-performing loans nearly doubling in the past five years. “Mortgages are not the problem,” said Ercan Uysal, a banking analyst at Istanbul-based research firm Integras. “Developer leverage is.”
- Why “The Grave Dancer” Is Cashing Out Once Again
Sam Zell has called the top again… Zell is a real estate mogul and self-made billionaire. He made a fortune buying property for pennies on the dollar during recessions in the 1970s and 1990s. This earned him the nickname “The Grave Dancer.” Zell was also one of the only real estate gurus to spot the last property bubble and get out before it popped. In February 2007, he sold $23 billion worth of office buildings. U.S. commercial property prices peaked nine months later and went on to plunge 42%.
- Investor rebellion over executive pay gathers pace
A shareholder rebellion over excessive executive pay has gathered pace with Weir Group, Shire, Standard Chartered and Reckitt Benckiser all targeted by investors. At the annual meeting of engineering firm Weir Group, a proposed pay policy was rejected by 72% of shareholders. The company says it will discuss alternative options with shareholders. At drugs maker Shire, 49% of investors voted against a 25% pay increase for chief executive Flemming Ornskov. Every three years shareholders receive a chance to vote on the way the formula for executive pay is constructed. That vote is binding, so the board needs a majority of shareholders to vote in favour. So, in the case of Weir, the board of directors will have to come up with a new plan. Votes between these three-year cycles are not binding, but can create embarrassment for the boss and the board of directors, as in the case of Shire.
- The U.S. Economy Officially Joins The Global Economic Slowdown – 1st Quarter GDP Comes In At 0.5%
Even the government is admitting that the U.S. economy is slowing down. On Thursday, we learned that U.S. GDP grew at just a 0.5 percent annual rate during the first quarter of 2016. This was lower than analysts were anticipating, and it marks the third time in a row that the GDP number has declined compared to the previous quarter. In other words, GDP growth has been declining for close to a year now, and this lines up perfectly with what I have been saying about how the second half of last year was a turning point that plunged us into the early chapters of a brand new economic crisis. And as you will see below, the official GDP number is highly manipulated, and the way that it is calculated has been changed numerous times over the years. So the bad number that is being reported by the government is actually the best case scenario.
- Economy Rotten-Like Apple Sales, Russia US Moving Towards Conflict, MSM Unfair to Trump
The economy is rotten just like Apple iPhone sales numbers. For the first time in 10 years, Apple reported its first quarterly sales drop for their popular iPhone. No, it’s not the end of the world, but it’s a sign there is trouble in the economy. Sure, Facebook beat its earnings projections, but they don’t make anything. Other bad news includes new home sales are down. Manufacturing numbers from the Dallas Fed are down. Consumer sentiment numbers from the University of Michigan are down. Spending is down. Retail sales are down. GDP in the first quarter came in at a paltry .5%. Economist John Williams says that number will be revised down and will probably turn negative. Williams says we are already in a recession or soon will be. Both Bo Polny and Greg Mannarino say the same thing: we are getting to a point where they can no longer hide the bad economy, and there really is no recovery after all.
- Dollar Selling Panic Coming-John Williams
Economist John Williams has long predicted the $16 trillion in U.S. dollar assets held outside of America will be sold in a panic. The time draws near for that scenario to unfold, and Williams explains, “When people start selling the dollar, or dollar denominated assets, you will see the value of the plunge. We have had a remarkable rally in the dollar since mid-2014, and it is up over 30%. It is going to be going down by more than that, and we are going to be headed to new lows. We have the waffling of the Fed and the beginnings of the perception that the economy is in serious trouble, which generally would be negative for the dollar. We have started to see selling pressure on the dollar. It has been inching lower. It’s down year to year now. . . . The selling is going to intensify, not only with large central banks, but with corporations that will be beginning to dump their Treasury holdings. . . . Nobody wants to be the last one out the door when you have a panic like this. It’s not a panic yet, but the potential certainly is there.”
- As The Price Of Gold Soars, Legend Warns That The World May Now Be Facing Catastrophic Consequences
Today a legend who oversees more than $170 billion warned that the world may now be facing “catastrophic consequences.” Eric King: “Rob, your firm helps to oversee $170 billion globally. What has you worried going forward? What has you concerned?” Rob Arnott: “We are overdue for a U.S. equity bear market and if we get a bear market it will have ripple effects across other asset classes. But the other thing that worries me even more than that is the central banks losing credibility and losing control.
- ALERT: Top Money Manager Says Gold And Silver Are Destined For A Historic Mania!
Today one of the top money managers in the world told King World News that gold and silver are destined for a historic mania! Stephen Leeb: “Right now I am focused on gold and silver, particularly gold and silver stocks. Many of these stocks have already tripled in price and some have gone up much more than that. I understand that the massive gains in the high quality mining companies give people pause, and they worry about whether or not to sell. But if I’m right, Eric, about there being a massive bull market in gold, can you imagine how high these stocks will go? Meaning, you haven’t seen anything yet when it comes to the shares. By the time this bull market is near its conclusion it will be an internet mania type of atmosphere for the mining shares…
- Gold and Negative Interest Rates
We hear more and more talk about the possibility of imposing negative interest rates in the US. In a recent article former Fed chairman Ben Bernanke asks what tools the Fed has left to support the economy and inter alia discusses the use of negative rates. We first have to define what we mean by negative interest rates. For nominal rates it’s simple. When the interest rate charged goes negative we have negative nominal rates. To get the real rate of interest we have to subtract inflation from the nominal rate, so to speak remove the illusion of inflation.
- Venezuela Ups Minimum Wage; Effective Rate a Whopping $13.50 Per Month
So much for that socialist paradise. Last summer we reported that hyperinflation had devalued the Venezuelan bolivar to the point that people were using 2-bolivar notes as napkins. In order to keep up with the rate of devaluation, the Venezuelan government literally flew in 747s full of cash. Now we’ve learned that the Venezuelan government is so broke, it can’t even pay to print more money.
- Two Fed Officials Signal Markets May Be Wrong to Doubt June Hike
Two regional Federal Reserve presidents said that an interest-rate increase should be on the table next month, pushing back against market expectations that the U.S. central bank will keep policy on hold for a fourth consecutive meeting. Atlanta Fed chief Dennis Lockhart and San Francisco’s John Williams both signaled on Tuesday that the U.S. economy could warrant a rate hike when the policy-setting Federal Open Market Committee gathers on June 14-15. Investors currently only see a 12 percent chance of such a move, according to pricing in interest rate futures contracts. “I would put more probability on it being a real option,” Lockhart told reporters at the Atlanta Fed’s financial markets conference at Amelia Island, Florida, when asked about the low implied odds of a move next month. “The communication of committee participants and members between now and mid-June obviously should try to prepare the markets for at least a realistic range of possibilities” for the next policy meeting.
- Hedge Funds Under Attack as Steve Cohen Says Talent Is Thin
In less than seven days, hedge funds have been subject to a three-pronged attack by some of the biggest names in finance. Steve Cohen, the billionaire trader whose former hedge fund had racked up average annual returns of 30 percent before pleading guilty to securities fraud three years ago, became the latest critic of the business, saying he’s astounded by its shortage of skilled people. “Frankly, I’m blown away by the lack of talent,” Cohen said at the Milken Institute Global Conference in Beverly Hills, California, on Monday. “It’s not easy to find great people. We whittle down the funnel to maybe 2 to 4 percent of the candidates we’re interested in. Talent is really thin.”
- U.S. Suicide Rate Surges to a 30-Year High
Suicide in the United States has surged to the highest levels in nearly 30 years, a federal data analysis has found, with increases in every age group except older adults. The rise was particularly steep for women. It was also substantial among middle-aged Americans, sending a signal of deep anguish from a group whose suicide rates had been stable or falling since the 1950s. The suicide rate for middle-aged women, ages 45 to 64, jumped by 63 percent over the period of the study, while it rose by 43 percent for men in that age range, the sharpest increase for males of any age. The overall suicide rate rose by 24 percent from 1999 to 2014, according to the National Center for Health Statistics, which released the study on Friday.
- Australia’s Central Bank Cuts Rates to Record Low
Australia’s central bank cut its benchmark interest rate to a record low and left the door open for further easing to counter a wave of disinflation that’s swept over the developed world. The move sent the local currency tumbling and stocks climbing. Reserve Bank of Australia Governor Glenn Stevens and his board lowered the cash rate by 25 basis points to 1.75 percent Tuesday, a move predicted by just 12 of 27 economists surveyed by Bloomberg. The rest had seen no change. Data last week showed quarterly deflation in the consumer price index and the weakest annual pace on record for core inflation — which the RBA aims to keep between 2 percent and 3 percent on average.
- Puerto Rico’s Debt Crisis Deepens as Government Misses Payment
Puerto Rico’s debt crisis moved into a more perilous phase for residents, lawmakers and bondholders Monday after the Government Development Bank failed to repay almost $400 million. The missed principal payment, the largest so far by the island, is widely viewed on Wall Street as foreshadowing additional defaults this summer, when more than $2 billion in bills are due.
- U.S. manufacturers still aren’t finding much daylight, ISM survey shows
U.S. manufacturers barely grew in April and there’s little sign of a broad pickup in business anytime soon, a survey of executives found. The Institute for Supply Management said its manufacturing index fell to 50.8% last month from 51.8% in March. Economists surveyed by MarketWatch had forecast the index to fall to 51.4%.
- The Nasty Secret About America’s Job Market
By all appearances, it seems like the American economy is back on its feet. Businesses are getting back on their feet, and as a result hiring additional employees to staff their firms. Many of the best jobs out there pay high wages, and the unemployment rate has held steady at around 5% for the past six months, according to the Bureau of Labor Statistics. For all intents and purposes, there are reasons to be optimistic about the economy. But once you dig past the headline unemployment rate, things get a little cloudier. A significant portion of Americans are considered to be “long-term unemployed,” and haven’t been able to find a job for extended periods of time. In other cases, older generations are finding jobs, but at the expense of younger workers looking to fill those same positions. But the biggest unresolved problem is that American’s part-time workforce has grown significantly, and experts aren’t sure it will ever shrink back to pre-recession levels.
- Is the US Economy Heading for Recession?
This past week the U.S. government announced the contry’s economy rose in the January-March 2016 at a mere 0.5 percent annual growth rate. Since the U.S., unlike other countries, estimates its GDP based on annual rates, that means for the first quarter 2016 the U.S. economy grew by barely 0.1 percent over the previous quarter in late 2015. Growth this slow indicates the US economy may have “slipped into ‘stall speed’, that is, growth so weak that the economy loses enough momentum and slides into recession”, according to economists at JPMorgan Chase.
- Baker Hughes Says US Oil Rig Count Drops Another 11 to 332
Baker Hughes reported the active oil rig count fell by 11 rigs to 332 for the week ending April 29. The total number of active oil and gas rigs declined by 11 to 420. This is the nineteenth week in a row the combined oil and gas rig count has fallen, moving further into record low territory. It is the sixth week in a row for oil-rigs only, now putting the total at its smallest count since late 2009. For the week ending April 22 the energy company said 9 combined oil and gas rigs went offline, bringing the total number of oil and gas rigs down to 431. The oil-rigs only count fell by 8 to 343. Crude oil is extending its gains for a fourth straight week and second consecutive month. The June WTI crude oil contract is currently trading lower on the session by 0.46% to $45.81.
- U.S. Consumer Sentiment Fell as Caution Continued
A closely watched gauge of U.S. consumer sentiment declined in April to its lowest level in seven months, the latest evidence of growing worry about the economy’s momentum. The University of Michigan final consumer-sentiment index for April, released on Friday, was 89.0, down from March’s final reading of 91.0 and the lowest level since September. “Consumer sentiment continued its slow decline in late April due to weakening expectations for future growth, although their views of current economic conditions remained positive,” said Richard Curtin, the survey’s chief economist.
- Chicago PMI falls to 50.4 in April in sign of economic weakness
A measure of Chicago-area economic activity softened in April, indicating that manufacturers and other large companies are still struggling to cope with lower exports, tepid global growth and even some weakness in the United States. The Chicago business barometer, or Chicago PMI, fell 3.2 points to 50.4 in April, MNI Indicators said Friday. Any reading over 50 indicates improving conditions, but the index has been hovering near the cutoff line for more than a year. Three of the five components in the survey deteriorated, including new orders. Orders dropped to the lowest level since December. Employment also turned negative again. A larger number of poll respondents are worried about the impact of a pending Federal Reserve interest-rate hike, the organization that compiles the report noted.
- Automating Ourselves To Unemployment
Students of Austrian business cycle theory are familiar with the term malinvestment. A malinvestment is any poor use of resources or capital, commonly made in response to bad policy (usually artificially low interest rates and/or unsustainable increases in the monetary supply). The dot-com bubble that popped in 2001? The housing bubble that similarly burst in 2008? Those were classic examples of malinvestment. With this article, I’d like to introduce a related term: malincentive. While not part of the official economic lexicon, I consider a ‘malincentive’ a useful word to describe any promise of short-term gain whose long-term costs outweigh any immediate benefits enjoyed. The temptation to urinate in one’s pants on a cold winter day to get warm is a (perhaps unnecessarily) graphic example of malincentive. Yes, a momentary relief from the cold can be achieved; but moments later, you’ll have a much larger problem than you did at the outset. Malincetives and malinvestment go hand-in-hand. In my opinion, the former causes the latter. As humans, we respond remarkably well to incentives. And dumb incentives encourage us to make dumb investments.
- After the leaks showed what it stands for, could this be the end for TTIP?
The documents show that US corporations will be granted unprecedented powers over any new public health or safety regulations to be introduced in future. If any European government does dare to bring in laws to raise social or environmental standards, TTIP will grant US investors the right to sue for loss of profits
- German plot to keep EU army a SECRET till June 23 EXPOSED: EU plan to control OUR forces
BRITISH Brexit campaigners have been boosted with news from Berlin that Germany is once more pushing for an EU army encompassing all 28 member states with a joint HQ and shared military planning. Along with judicial, tax and immigration issues, a Euro army has for long been one of the main irritants of anti-EU campaigners. The fact that Germany – the powerhouse of the project – is mooting one so close to the referendum on whether Britain stays or goes is seen as madness by politicians fighting to keep the UK within the group. Now a white paper has been drawn up by Berlin. Media reports suggest that the Germans wanted to keep its proposals secret until after the June 23 plebiscite but it has now been leaked.
- BRUSSELS SHOCK: EU plots tax on British…to fund benefits for jobless in ITALY
BARMY Brussels bureaucrats are plotting to tax British shoppers to help subsidise the growing benefits bill for the Eurozone’s jobless. Leaders on the continent want to milk Britain’s growing economy by slapping a VAT-style tax on goods and services to fund an EU-wide unemployment benefit fund. The plan would mean British shoppers shelling out millions more at the tills every year to pay for benefits and job creation schemes in Mediterranean countries including Spain and Italy, which have high unemployment rates.
- A New Digital Cash System Was Just Unveiled At A Secret Meeting For Bankers In New York
Last month, a “secret meeting” that involved more than 100 executives from some of the biggest financial institutions in the United States was held in New York City. During this “secret meeting“, a company known as “Chain” unveiled a technology that transforms U.S. dollars into “pure digital assets”. Reportedly, there were representatives from Nasdaq, Citigroup, Visa, Fidelity, Fiserv and Pfizer in the room, and Chain also claims to be partnering with Capital One, State Street, and First Data. This “revolutionary” technology is intended to completely change the way that we use money, and it would represent a major step toward a cashless society. But if this new digital cash system is going to be so good for society, why was it unveiled during a secret meeting for Wall Street bankers? Is there something more going on here than we are being told?
- The End Of America?: 13 Catastrophic Events Which Could Soon Lead To An American Apocalypse
Is the strongest and most powerful nation on the planet headed for an apocalypse which will bring it to its knees? We live in a world that is becoming increasingly unstable, and apocalyptic themes have become very common in books, movies, television shows and video games. It is almost as if there is an unconscious understanding on a societal level that something very big and very bad is coming, even if the vast majority of the population cannot specifically identify what that is going to be. Last week, the Global Challenges Foundation released a new report entitled “Global Catastrophic Risks 2016” in which they discussed various apocalyptic events that they believe could wipe out more than 10 percent of the population of our planet, and they warned that these types of events “are more likely than we intuitively think”…
- This Is Where America’s Runaway Inflation Is Hiding
The Census Bureau released its quarterly update on residential vacancies and homeownership for Q1 which is closely watched for its update of how many Americans own versus rent. It shows that following a modest pickup in the homeownership rate in the prior two quarters, US homeowners once again posted a substantial decline, sliding from 63.8% to 63.5%, and just 0.1% higher than the 50 year low reported in Q2 2015.
- Very Big Correction for All Markets Coming-Alasdair Macleod
Financial expert Alasdair Macleod says the most important economic news concerns the U.S. dollar. Macleod explains, “I think the most important point is actually the dollar has turned. The panic move into the dollar by miners and producers of raw material . . . was driving the dollar up. That has now ceased. China has now started buying those raw materials, base metals, oil and so on and so forth. So, the result is the commodity crisis is over. That, actually, is the biggest driver of the dollar, which is pushing it down.”
- Egon von Greyerz Warns The World Is Now On The Edge Of Total Chaos And Disaster
On the heels of wild start to the 2016 trading year, today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events, just warned that the world is now on the edge of total chaos and disaster. He also discussed the historic opportunity in the gold and silver markets. Egon von Greyerz: “We know that central banks and governments have lost the plot. When the crisis started in 2006, US short rates were 5%. In 2008 they were down to zero and have virtually stayed there ever since. A crisis package of $25 trillion was thrown at the financial system. This is what the likes of JP Morgan and Goldman told the Fed they had to do to save the bank(-ers). Ten years later the world financial system is in a mess that is exponentially increasing. World debt has exploded, most governments are running deficits and the financial system is balancing dangerously on the edge of a precipice. $8 trillion of government debt is now negative and $16 trillion is below 1%…
- 50-Year Market Veteran Discusses What’s Next After One Gold & Silver Index Soars 135% In Just Over 3 Months!
With the U.S. dollar trading lower once again and the metals consolidating recent gains, today a 50-year market veteran discussed what’s next after one gold and silver index soars 135% in just over 3 months! Eric King: “You have to be very careful not to simply use the COT Report (on gold and silver) because it can be a fairly good timing tool on the way down, at bottoms — and it’s not perfect at that, but on the way up it’s very difficult. And I know we’ve had a lot of people calling tops, and these (calls) were at much lower prices. And the problem with calling those tops is that the commercial COT Report, it’s not going to give you those answers that easy. I remember one time when I was speaking to Ted Butler and the commercials were 100 percent short (on a historic basis) at that time on silver and the price was $6. What happened was the price of silver proceeded to surge 40 percent higher to $8.40, before then collapsing back down so the commercials could try to get healthy on those positions…
- ALERT: SentimenTrader Just Issued An Extremely Important Update On Gold & Silver
After last week’s surge in the metals sent the prices of gold and silver to new recent highs, SentimenTrader just issued an extremely important update on the gold and silver markets. From Jason Goepfert at SentimenTrader: “The thrust in gold and gold stocks over the past three months has met the conditions of the studies and indicators that we discussed last fall, particularly last November. By mid-March, several indicators were suggesting shorter-term extreme optimism and the metals backed off a bit. Since then they have surged again, particularly the mining stocks. A concern remains “smart money” hedger positions which are at or near multi-year extreme bets against the metals.
- FTSE 100: is this the perfect storm?
The definition of a ‘perfect storm’ is where a rare combination of factors come together to drastically aggravate a situation. Looking ahead, it could be argued that the FTSE 100 faces a perfect storm during the rest of the year and that its downside risks are far greater than its potential upside. The most obvious risk facing the FTSE 100 is Brexit. This may not seem all that likely if most of the polls are to be believed, but there have been numerous occasions in the past where pollsters have made major errors with their predictions (such as in last year’s General Election). And with a number of voters being either undecided or seemingly carefree about the issue, there’s a real prospect of Britain leaving the EU as a result of 23 June’s vote.
- Britain is horribly unprepared for the coming recession
It’s the worst of all worlds: Britain looks like it is slipping complacently into a new recession but the country is hopelessly unprepared to deal with it. The macro data is ugly: Construction growth is the weakest in three years. Manufacturing went into contraction for the first time in three years. Consumers have switched their spending from retail goods to food — a sign they don’t feel confident about the finances.
- ALERT: Paul Craig Roberts Just Warned The World Financial System Is On Fire And The Price Of Gold May Skyrocket
Today former U.S. Treasury Secretary, Dr. Paul Craig Roberts, warned King World News that the world financial system is on fire and the price of gold may skyrocket. Dr. Paul Craig Roberts: “The West no longer exists. There’s no longer any democracy in the West, certainly not in the United States. The people have chosen Trump, so what are the politicians doing? They simply won’t accept the choice. We see the same thing all over Europe. The British military announced that if the Labour Party Leader Jeremy Corbyn were to win the election, they (the British military) would simply not let him take office…
- Putin fires several high-ranking officials in bid to overhaul Russia’s law enforcement structures
Russia’s President Vladimir Putin fired several high-ranking law enforcement officials on Saturday in one of the biggest overhauls of the country’s power structures in recent years. According to a decree published on the president’s official legal portal, Putin fired the Southern transport public prosecutor Seregei Dmitriev, the head of the Federal Penitentiary Service in Moscow Igor Klimenov, and Deputy Interior Minister of the annexed Crimea region Dmitry Neklyudov. Putin also dismissed, among others, two deputies of Russia’s Investigative Committee, Yuri Nyrkov and Vasily Piskarev. He raised the rank of the Committee’s investigator for special cases case, Lev Gura, to a senior investigator.
- Russia challenges US after Baltic jet face-off
Russia says it was right to confront a US Air Force reconnaissance plane over the Baltic Sea on Friday. The Pentagon said a Russian jet fighter acted in an “unsafe and unprofessional manner”, and performed a barrel roll over its plane. Russia said that the American jet had turned off its transponder signal, which helps others identify it. It is the second incident in the Baltic this month in which the US has accused Russian planes of flying aggressively.
- Trump Picks Former Goldman Partner And Soros Employee As Finance Chairman
In an oddly ironic twist, today Donald Trump announced that he has picked as chairman of his newly launched fundraising operation none other than a former employee of the bank he has repeatedly criticized in the past, and which he used as a foil to criticize Ted Cruz: Goldman Sachs. Trump announced that heading up his own personal fundraising operation as national finance chairman will be Steven Mnuchin, a long-time business associate, chairman and CEO of the hedge fund Dune Capital. More importantly, however, he spent 17 years at Goldman Sachs where he was most recently a Partner, having built a fortung of $46 million before launching his own hedge fund.
- Russian nuclear sub fires CRUISE MISSILE in chilling footage of Arctic military drill
The 120-metre Severodvinsk submarine can be seen sinking slowly below the surface before its Kalibr missile erupts from the waves. Is this a warning shot? This chilling footage shows a Russian nuclear submarine launching a cruise missile from underwater to destroy a coastal training target. The 120-metre Severodvinsk submarine can be seen sinking slowly below the surface of the Barents Sea as part of Russian navy Arctic combat drills. Then the Kalibr missile erupts from the waves in a plume of smoke and streaks away into the distance. A loud rumbling can be heard before the camera zooms in to show the launch site. It is the latest show of strength from the country’s military after a number of close passes by fighter jets near US planes and ships.
- Warnings mount on world’s corporate debt, China crisis
Corporate debt has reached extreme levels across much of the world and now far exceeds the pre-Lehman financial bubble by a host of measures, the global banking watchdog has warned in a deeply-disturbing report. “As the credit cycle ages, following years of record-setting bond issuance, there are growing concerns about signs of stress in corporate balance sheets,” said the Institute of International Finance in Washington. The body flagged a double threat: a five-fold rise in company debt to $25 trillion in emerging markets over the past decade; and record junk bond issuance in US and Europe, along with shockingly-irresponsible levels of US borrowing to buy back shares and pay dividends.
- China’s shadow banking adapts and grows as rules tighten
New players in China’s shadow banking sector are growing rapidly despite attempts to clamp down on opaque lending, taking advantage of a regulatory anomaly to prosper but also raising the risks of a build-up of debt in the slowing economy. Authorities have sought to rein in the riskiest elements of less-regulated lending after a series of defaults, including a 4 billion yuan ($640 million) credit product backed by Evergrowing Bank in September, because of the danger such debts could pose to the health of the world’s second-largest economy. And a government measure created in 2011 to capture shadow banking, total social financing (TSF), shows some success, with shadow banking contracting in the second half of 2014 to roughly 21.9 trillion yuan ($3.5 trillion), according to a Reuters’ analysis of central bank data.
- High leverage shifts to China’s bond market after equities deflate
Just when investor fears over plunging Chinese stocks appear to be calming down, the country’s frothy corporate bond market is stirring concerns it could be the next domino to fall. Investment funds have flowed rapidly into corporate bonds since the stock market collapsed in June, triggering a surge of debt issuance. Demand has compressed corporate and sovereign bond spreads to their narrowest in four years – an oddity, when industrial profits are falling and credit risks are rising. While bond investors say corporate bond prices are not at unreasonable levels, they are wary a sharp correction could be sparked by a bond default from major state-owned companies or a change in monetary policy.
- High leverage shifts to China’s bond market after equities deflate
Just when investor fears over plunging Chinese stocks appear to be calming down, the country’s frothy corporate bond market is stirring concerns it could be the next domino to fall. Investment funds have flowed rapidly into corporate bonds since the stock market collapsed in June, triggering a surge of debt issuance. Demand has compressed corporate and sovereign bond spreads to their narrowest in four years – an oddity, when industrial profits are falling and credit risks are rising. While bond investors say corporate bond prices are not at unreasonable levels, they are wary a sharp correction could be sparked by a bond default from major state-owned companies or a change in monetary policy.
- Chinese police to patrol in Italy in pioneering experiment
Four Chinese police officers will patrol alongside Italian police in Rome and Milan, as a two-week experiment. The officers, who speak Italian, are being sent in a bid to make Chinese tourists feel safe during the peak tourism period, said Italian Interior Minister Angelino Alfano. “If the experiment is successful, we will expand it to other cities in Italy,” he said. Around three million Chinese tourists visit Italy annually. Mr Alfano said that Italian officers would also soon be heading to Beijing and Shanghai to patrol alongside Chinese officers.
- HSBC profit falls amid volatile markets
Banking giant HSBC has reported a 14% drop in profits for the first quarter following “extreme levels of volatility” in financial markets at the start of the year. Profit before tax came in at $6.1bn (£4.17bn) for the three months to March, down from $7.1bn a year ago. However, analysts had expected a far steeper fall in profits. HSBC chief executive Stuart Gulliver said the bank had been “resilient in tough market conditions”. Adjusted pre-tax profits, including currency effects and one-off items, fell 18% to $5.4bn (£3.7bn).
- European banks near ‘terrifying’ crisis: Raoul Pal
With European banks sitting at multiyear lows, one widely followed market watcher said some of the biggest ones could go bankrupt. Former hedge fund manager and Goldman Sachs alumnus Raoul Pal said his scenario is one most investors aren’t looking at right now. Pal said the banking issues have the potential to overtake risks associated with China’s growth slowdown and cheap oil. “So many of these [bank stocks] are falling so sharply. I think people haven’t even caught up with what is going on, and that really concerns me,” the founder of Global Macro Investor told CNBC’s “Fast Money” on Tuesday. “I look at the big long-term share charts of them, and I think this looks very terrifying indeed. I have not seen anything like this for a long time.”
- China halts release of output data for key commodities
China has suspended the release of output data for several key commodities amid a crackdown on the illegal sale of state statistics by government officials, raising further concerns about transparency in the world’s second-largest economy. With Chinese economic growth at a 25-year low, the lack of such data makes it increasingly difficult for economists to gauge the strength of local demand as Beijing tries to avert a faster slowdown. Key monthly output numbers for several oil and metal products over the first quarter have still not been published.
- Repair businesses provide antidote to throwaway culture
The hall of a primary school in Brooklyn is unusually busy for a Saturday morning. This is a “pop-up repair” event, and it is drawing in the crowds. Parents and children from around the neighbourhood have brought in their broken things to be fixed by menders, each with their own area of expertise. At different tables, repairers fix jewellery, electronics and furniture among many other things. This is also an opportunity to teach kids repair skills, and a group of boys is hammering away in the corner. In the midst of this hive of noisy tinkering stands Sandra Goldmark.
- Russians to get ‘free’ land in bid to boost Far East
A law offering Russian citizens land in the country’s sparsely populated Far East has come into force – but few think there’ll be a rush to take advantage. Every Russian can soon apply to hold a one-hectare (2.5-acre) patch of state or municipal land – about the size of a rugby field – for five years, the News.ru website reports. After that time, people can either rent or buy their plot, or may be given it free of charge. There’s one condition: they must prove to the local authorities that the land has been used productively. The area up for grabs is vast, stretching from Chukotka – Russia’s most north-eastern point, near Alaska – down to the Chinese border, and as far west as the Sakha Republic (Yakutia) in Siberia. The region’s population has been shrinking steadily since the end of the Soviet Union as residents leave for less remote and more prosperous parts.
- How to survive a zombie apocalypse: Find a mountain range, keep quiet, mimic the way the undead walk and NEVER fight
From a remote farmhouse to a shopping mall and even a bar, films are full of suggestions of where to hide out in the event of a zombie apocalypse. But researchers have developed an apocalyptic simulator that suggests the best thing to do is literally run for the hills – if you live in the US at least. Other advice from scientists-turned zombie experts, includes keeping silent and even mimicking zombie behaviour should you run into one of the fictional reanimated corpses with a taste for human flesh.
- Johns Hopkins Psychiatrist: Transgender is ‘Mental Disorder;’ Sex Change ‘Biologically Impossible’
Dr. Paul R. McHugh, the former psychiatrist-in-chief for Johns Hopkins Hospital and its current Distinguished Service Professor of Psychiatry, said that transgenderism is a “mental disorder” that merits treatment, that sex change is “biologically impossible,” and that people who promote sexual reassignment surgery are collaborating with and promoting a mental disorder.
- The IMF Just Confirmed The Nightmare Scenario For Central Banks Is Now In Play
The most important piece of news announced today was also, as usually happens, the most underreported: it had nothing to do with US jobs, with the Fed’s hiking intentions, with China, or even the ongoing “1998-style” carnage in emerging markets. Instead, it was the admission by ECB governing council member Ewald Nowotny that what we said about the ECB hitting a supply brick wall, was right. Specifically, earlier today Bloomberg quoted the Austrian central banker that the ECB asset-backed securities purchasing program “hasn’t been as successful as we’d hoped.” Why? “It’s simply because they are running out. There are simply too few of these structured products out there.”
- Hong Kong Puts J.P. Morgan Chase on Its ‘Name and Shame’ IPO List
JPMorgan Chase has become the first global investment bank to fall foul of Hong Kong’s stricter IPO sponsorship rules, dealing a blow to its reputation in the region. The Hong Kong stock exchange introduced tougher disclosure rules in 2014, which can make banks criminally liable if a listing prospectus is found to have misled investors. It returned a listing application for Shenhua Health Holdings, a subsidiary of monosodium glutamate (MSG) producer Fufeng Group, on March 29 saying it needed more information, exchange data showed. JPMorgan Securities acted as sole sponsor of the IPO.
- Zimbabwe to print own version of US dollar
Zimbabwe is set to print its own version of the US dollar in order to ease a cash shortage in the country. Central bank governor John Mangudya said the cash, known as bond notes, will be backed by $200m (£140m) support from the Africa Export-Import Bank. The specially-designed two, five, 10 and 20 dollar notes will have the same value as their US dollar equivalents. Zimbabwe introduced the US dollar after ditching its own currency in 2009 following sustained hyperinflation. Since then Zimbabweans have been using the dollar as well as a number of other foreign currencies including the South African rand and the Chinese yuan.
- Migrant crisis: EU plans penalties for refusing asylum seekers
The European Commission has proposed reforms to EU asylum rules that would see stiff financial penalties imposed on countries refusing to take their share of asylum seekers. The bloc’s executive body is planning a sanction of €250,000 (£200,000; $290,000) per person. The Commission wants changes made to an asylum system which has buckled amid an influx of migrants. The plans would require support from most member states as well as MEPs. EU officials hope that, twinned with a deal with Turkey that has already reduced migrant numbers, tensions over migration within the bloc can be reduced.
- Freight Rail Traffic Plunges: Haunting Pictures of Transportation Recession
Total US rail traffic in April plunged 11.8% from a year ago, the Association of American Railroads reported today. Carloads of bulk commodities such as coal, oil, grains, and chemicals plummeted 16.1% to 944,339 units. The coal industry is in a horrible condition and cannot compete with US natural gas at current prices. Coal-fired power plants are being retired. Demand for steam coal is plunging. Major US coal miners – even the largest one – are now bankrupt. So in April, carloads of coal plummeted 40% from the already beaten-down levels a year ago.
- ECB warns on US economic data leaks
US investors may have earned millions of dollars in profits from early access to leaked economic data the European Central Bank (ECB) has alleged. Researchers at the bank studied the movements of trades ahead of several market-moving US economic reports. They included a US consumer confidence index, home sales data and initial US GDP data among others. The study found “strong” evidence of pre-announcement price moves in at least seven cases. The ECB research paper, Price Drift Before US Macroeconomic News, studied investment trading patterns in the case of 21 market-moving economic indicators between 2008 and 2014.
- The Historic Dow Jones-Silver Ratio Points To $300 Silver
That’s correct. Going by the historic Dow Jones-Silver ratio, it points to $300 silver. This may seem outlandish or a play on hype, but it isn’t. While many precious metals analysts have forecasted high three-digit silver prices, I didn’t pay much attention to them. However, after I looked over all the data, $300 silver is not a crazy figure at all. Let me explain. The U.S. economy suffered a fatal blow in the 1970’s as its domestic oil production peaked and inflation soared. To protect against the ravages of inflation, investors moved into gold and silver in a big way. Yes, it’s true that the Hunt’s bought a lot of silver during the 1970’s, but who was buying gold to push its price to $850 in 1980 versus $35 in 1970. Furthermore, who was buying oil to push its price up to $36 in 1980 from $1.80 in 1970??
- National Bank to set aside $250-million for bad loans to energy sector
National Bank of Canada said that it will set aside $250-million to cover bad loans associated with the oil and gas sector, lowering its profit for the second quarter as banks continue to struggle with a depressed energy sector despite a rebound in the price of oil. The announcement from National Bank on Thursday morning follows a similar one earlier this week from Canadian Western Bank, which said that its provisions for loan losses would quadruple to $40-million. National Bank said that its provisions were specifically tied to its portfolio of loans to oil and gas producers and services.
- The cashless society is under construction
Two news stories this week are huge reminders that the cashless society already is under construction throughout the Western world. I have added the word Western, because there are rumblnigs from Middle-Eastern countries that Islamic scholars are now working on a new interpretation of Sharia Law to allow gold to be used in commerce. So, while the West is moving toward a digital fiat system, the East is headed in the opposite direction with the intent of placing precious metals at the center of all monetary transactions. What a tragedy for the West.
- Ron Paul: What America Has Today Is Not Free Market Capitalism
Capitalism appears to be falling out of favor. Socialism is in vogue. Or at least that’s the impression one gets when talking to millennials in America. A recent Harvard University poll shows that more than half of Americans in the 18-29 age bracket oppose capitalism. Ron Paul appeared on RT America’s Boom or Bust show earlier this week to address this issue and pointed out the problem isn’t a failure of capitalism per se. The problem is that so few people actually understand what capitalism is. In fact, Paul argues that America’s economic system isn’t really free market capitalism
- What Will Happen When Central Planners Finally Lose Control?
Today KWN is pleased to share a dramatic chart that begs the question: What will happen when central planners finally lose control? From Jason Goepfert at SentimenTrader: “Each year, a number of prominent hedge fund managers gather for the Sohn Investment Conference and outline their rationales for long or short investments in stocks or macro views on other markets. One of the managers with a nearly unmatched record over several decades is also among the most negative on stocks. Stan Druckenmiller gave several reasons to be bearish, most of which were unchanged from his outlook last year. One difference was volatility. As he noted, “volatility in global equity markets over the past year, which often precedes a major trend change, suggests that their risk/reward is negative without substantially lower prices…”. It certainly seems like we’ve seen a lot of volatility. At the end of April, the S&P 500 was basically unchanged over the past 12 months (it was within 20 points of where it closed in April 2015). Even though it was essentially unchanged, during the year the S&P moved as much as 18% from high to low. That seems like a lot of movement for not much gain, but in the grand scheme of things, that 18% range is among the tightest in history.”
- The Next Employment Crisis Is Here: Job Cuts At U.S. Companies Jump 35 Percent In April
Should we be alarmed that the number of job cuts announced by large U.S. companies was 35 percent higher in April than it was in March? This is definitely a case where the trend is not our friend. According to Challenger, Gray & Christmas, U.S. firms announced 65,141 job cuts during April, which represented a massive 35 percent increase over the previous month. And so far this year overall, job cut announcements are running 24 percent higher than for the exact same period in 2015. Meanwhile, on Thursday we learned that initial claims for unemployment benefits shot up dramatically last week. In fact, the jump of 17,000 was the largest increase that we have seen in over a year. Of course the U.S. economy has been slowing down for quite a while now, and many have been wondering when we would begin to see that slowdown reflected in the employment numbers. Well, that day has now arrived.
- Two Billionaires Just Issued Dire Warnings About The Coming Carnage In Global Markets
As fear around the globe increases and more investors begin to worry about the insane policies of central banks, two billionaires just issued dire warnings. Gerald Celente: “Stanley Druckenmiller was speaking this week at a major investment conference in New York. They wanted him to be specific about recommendations and he said, ‘The conference wants a specific recommendation from me? Get out of the stock market isn’t clear enough? It’s also important to note that Druckenmiller said that ‘Gold remains our largest currency allocation.’ Druckenmiller then went on to warn that the corporations have relied on cheap money from the Federal Reserve by engineering over $2 trillion in acquisitions and stock buybacks in the last year. He said this is finally showing up on the books of companies, ‘as operating growth in U.S. companies has gone negative year-over-year, while net debt has gone up.’
- Rail Traffic Depression: 292 Union Pacific Engines Are Sitting In The Arizona Desert Doing Nothing
We continue to get more evidence that the U.S. economy has entered a major downturn. Just last week, I wrote about how U.S. GDP growth numbers have been declining for three quarters in a row, and previously I wrote about how corporate defaults have surged to their highest level since the last financial crisis. Well, now we are getting some very depressing numbers from the rail industry. As you will see below, U.S. rail traffic was down more than 11 percent from a year ago in April. That is an absolutely catastrophic number, and the U.S. rail industry is feeling an enormous amount of pain right now. This also tells us that “the real economy” is really slowing down, because less stuff is being shipped by rail all over the nation.
- US Commercial Bankruptcies Skyrocket
One of the big indicators of the end of the “credit cycle” is the number of bankruptcies. During good times, so earlier in the credit cycle, companies borrow money. Then, overconfident and lured by low interest rates and overoptimistic rosy-scenario rhetoric emanating from all sides, they do what the Fed and Wall-Street firms want them to do: they borrow even more money. Then reality sets in, and they buckle under this pile of debt. The bankruptcy filings of Ultra Petroleum and Midstates Petroleum on Friday and Saturday brought oil & gas bankruptcies of companies rated by Fitch and other ratings agencies to 59. These two companies piled $3.1 billion in defaulted junk bonds and another $1.5 billion in defaulted loans on top of the growing mountain of defaulted oil & gas debt.
- Silent Coup Beginning to Overtake America Now-Larry Nichols
Former Clinton insider Larry Nichols has worked with, and now against, the Clintons. Nichols has some of the top political and financial connections on the planet. Nichols hopes the public is finally realizing the enormous power struggle going on. Nichols explains, “There is no two-party system in the United States of America. Let’s get that straight. There is no two-party system, there is one. Part of it is a red team and part of it is a blue team. You think you have a choice, but as you know you only have a choice between the two they give you to vote for, but here comes Trump. Trump doesn’t need their money . . . he will bust up the system, and he will not only bust up the system for the Republican Party, but he will bust up the system (for both parties). So, there are many establishment Republicans that have said they would rather vote for Hillary than Trump. . . . They must maintain status quo of the system for these power elite people to stay where they want to be.”
- “Market is on Edge”: US Commercial Real Estate Bubble Pops, San Francisco Braces for Brutal Dive
Commercial real estate has experienced a dizzying price boom since the Financial Crisis. It goes in cycles. Rising rents and soaring property prices along with cheap credit drive up construction, which takes years from planning to completion, and suddenly all this capacity is coming on the market just as demand begins to sag…. That’s when the cycle turns south. On a nationwide basis, the boom has been majestic. But now, after posting “nearly double-digit gains for each of the past few years,” according to Green Street’s just released Commercial Property Price Index (CPPI) report, “property appreciation has come to a halt.”
- ‘We’re running a f—ing casino’: Politician tells all in manifesto
An anonymous congressman has dropped a bombshell election-year book that confirms why Americans hate their national government and have rallied to anti-establishment presidential candidates like Donald Trump. The veteran politician lays bare a rotten and corrupt Congress enslaved by lobbyists and interested only in re-election in an anonymous, 65-page manifesto called “The Confessions of Congressman X.” “Like most of my colleagues, I promise my constituents a lot of stuff I can never deliver,” he admits. “But what the hell? It makes them happy hearing it . . . My main job is to keep my job.”
- “Markets Have No Purpose Any More” Mark Spitznagel Warns “Biggest Collapse In History” Is Inevitable
After making over $1 billion in one day last August, and warning that “the markets are overvalued to the tune of 50%,” Mark Spitznagel knows a thing or two about managing tail risk. The outspoken practitioner of Austrian economic philosophy tells The FT, “Markets don’t have a purpose any more – they just reflect whatever central planners want them to,” confirming his fund-management partner, Nassim Taleb’s perspective that “being protected from fragility in the financial system is a necessity rather than an option.”
- World’s Most Bearish Hedge Fund Manager: “I Think Something Has Changed”
One month ago, when we updated on the performance of Horseman Global, what until recently was the world’s most bearish hedge fund with a record net short exposure of -98% at least until Icahn Enterprises emerged with its even more gargantuan -149% net short we cited fund CIO Russell Clark who observed the fund’s dramatic -9.6% drop in the month of March, and made it clear that he wasn’t going anywhere because he was confident that the move was nothing but a short squeeze, which – if anything – made Clark even more bearish.
- What Will The Global Economy Look Like After The “Great Reset”?
A very common phrase used over the past couple years by the International Monetary Fund’s Christine Lagarde as well as other globalist mouthpieces is the “global reset.” Very rarely do these elites ever actually mention any details as to what this “reset” means. But if you take a look at some of my past analysis on the economic endgame, you will find that they do, on occasion, let information slip which gives us a general picture of where they prefer the world be within the next few years or even the next decade.
- Obama: TTIP Necessary So As To Protect Megabanks From Prosecution
On May 7th, Deutsche Wirtschafts Nachrichten, or German Economic News, headlined, “USA planen mit TTIP Frontal-Angriff auf Gerichte in Europa” or “U.S. Plans Frontal Attack on Europe’s Courts via TTIP,” and reported that, “America’s urgency to sign TTIP with Europe has solid reason: Megabanks must protect themselves from claims by European investors who allege that they were cheated during the debt crisis. … The U.S. Ambassador to Italy has now let the cat out of the bag on this — probably unintentionally.”
- Kerry slams Trump’s wall, tells grads to prepare for ‘borderless world’
Secretary of State John Kerry took a shot at Donald Trump during his Friday commencement speech to Northeastern University graduates, by saying no wall is big enough to keep dangerous terrorists out of the United States. “Many of you were in elementary school when you learned the toughest lesson of all on 9/11,” he said in his speech at Boston Garden. “There are no walls big enough to stop people from anywhere, tens of thousands of miles away, who are determined to take their own lives while they target others.”
- Lifespan gap ‘widening between rich and poor’
The gap between the lifespans of rich and poor people in England and Wales is rising for the first time since the 1870s, researchers have suggested. Everyone is living longer but rich people’s lives are extending faster, the City University London study says. Better life expectancy narrowed the gap in the early 20th Century but this trend reversed for men in the 1990s. Author Prof Les Mayhew from Cass Business School said the difference was mainly due to “lifestyle choices”.
- News Corp reports $149m quarterly loss
Media giant News Corp has reported a net loss of $149m (£102.6m) for the three months to March. That compares with a profit of $23m in the same quarter last year. The group suffered as a result of a one off legal charge of $280m at its News America Marketing business. Revenue also fell – by 7.3% to $1.89bn. News Corp, controlled by Rupert Murdoch, gets over half its revenue from outside the US and it blamed “currency headwinds” for the drop.
- Greece hit by general strike over pension and tax change
Greeks have begun a three-day general strike in protest at further austerity measures that are being proposed in return for more bailout money. Shipping, public transport and civil service departments were among sectors hit in a bid to stop the introduction of tax and pension changes. The sudden 48-hour strike on Friday and Saturday was called in addition to action previously planned for Sunday. Greece’s left-led government is due to a vote on the tax changes on Sunday. The next tranche of about €5bn (£4bn) is overdue, after talks with Greece’s international lenders faltered over the pace of reforms.
- IMF tells euro zone finance ministers to start talks on Greek debt relief – FT
The head of the International Monetary Fund urged euro zone finance ministers to start talks on Greece’s debt relief together with discussions on Athens’ reform programme, according to a letter published by the Financial Times on Friday. The finance ministers of the euro zone’s 19 countries will gather on May 9 in Brussels for an extraordinary meeting on Greece. They are meant to discuss Greece’s reform programme and a new set of contingency measures that Athens should adopt to ensure it will achieve agreed fiscal targets in 2018. Successful reforms implementation in Athens would unlock bailout funds under a financial programme agreed by Greece and euro zone countries in July and would pave the way for talks on Greece’s debt relief.
- Russia’s car workers who struggle on no pay
In a sparsely furnished, single-room flat in Togliatti, Natalia Sizova counts the hours until she sees her five-year-old son again. Six months ago she had so little food she decided he should go and live in a care centre across town. Natalia is one of 2,000 people in this city, 1,000km (620 miles) east of Moscow, who work for car-parts maker AvtoVAZagregat. Their salaries have not been paid for months. Togliatti is not alone. Hundreds of Russian companies, big and small, are withholding salaries. The explanations may differ: mismanagement, bad economy or plain criminality. But for workers the end result is the same.
- Eurogroup meeting, 09/05/2016
The Eurogroup discussed the state of play of the first review of Greece’s macroeconomic adjustment programme. It welcomed a package of policy reforms, which will cover: the pension system, income tax and VAT, public sector wage bill measures, privatisation strategy, the issue of non-performing loans. The Eurogroup concluded that further work was needed by the Greek authorities and the institutions on a mechanism concerning additional contingency measures. These measures will come into force only if additional effort is needed to reach the agreed primary surplus targets. The conclusion of the first review will pave the way for the disbursement of further financial assistance for Greece, following the implementation of prior actions by Greece and the relevant national procedures in the other euro area member states.
- Iain Duncan Smith: EU favours ‘haves over the have-nots’
The European Union is a “force for social injustice” which backs “the haves rather than the have-nots”, Iain Duncan Smith has said. The ex-work and pensions secretary said “uncontrolled migration” drove down wages and increased the cost of living. He appealed to people “who may have done OK from the EU” to “think about the people that haven’t”. But Labour’s Alan Johnson said the EU protected workers and stopped them from being “exploited”. The former Labour home secretary accused the Leave campaign of dismissing such protections as “red tape”.
- America’s infrastructure US$1.44 trillion short through 2025: report
America will fall US$1.44 trillion short of what it needs to spend on infrastructure through the next decade, a gap that could strip 2.5 million jobs and US$4 trillion of gross domestic product from the economy, a report from a society of professional engineers said on Tuesday. The American Society of Civil Engineers (ASCE) estimated that through 2025, the United States has funded only about 56 percent of its needed infrastructure spending. The nation needs to spend US$3.32 trillion to keep its ports, highways, bridges, trains, water and electric facilities up to date but has funded only US$1.88 trillion of that, ASCE said. The shortfall rises to US$5.18 trillion through 2040 without new funding commitments. U.S. GDP was US$18 trillion in 2015, according to the International Monetary Fund.
- Left in the dark as Venezuela’s crisis deepens
I have seen worse conditions in a hospital. I have seen patients even more deprived of the medicines they need. But rarely have I seen an institution that appears to have gone into such steep decline as University Hospital, Caracas. A long queue stretches from the hospital entrance as people wait in line for the lift. That’s lift in the singular, because only one has been operating for the past few months. It is unclear whether the others are broken or are simply not being used because there is insufficient electrical power. Once you reach the wards, you find there is not enough electricity even for lighting, and some of the corridors are in darkness. Perhaps it is a good thing that the toilets and shower rooms are dark, as it provides a modicum of privacy. Cubicle doors are broken, hanging off hinges. I saw patients on a cardiac ward forced to wash in a half-wrecked stall, with a small piece of plastic drawn across.
- UK trade deficit biggest since 2008 in first quarter
The UK’s trade deficit for the first quarter is at its biggest since 2008. The gap between imports and exports for the first three months of 2016 stands at £13.3bn, up from £12.2bn in the fourth quarter of 2015, says the Office for National Statistics (ONS). Analysts said this was more evidence of the weight of global economic weakness on the UK. One described the figures as “truly horrible” UK economic growth has already slowed to 0.4% in the first quarter. The ONS said the UK trade gap widened over the quarter because of a £1.9bn rise in imports such as mechanical machinery, cars, clothing, jewellery and footwear.
- Banker given record sentence for insider dealing
A former senior investment banker and an accountant have been jailed for their part in the UK’s “largest and most complex insider dealing investigation”. Former Deutsche Bank managing director Martyn Dodgson was sentenced to four and a half years in prison, the longest term for the crime in the UK. Businessman Andrew Hind received three and a half years. They were convicted on Monday of conspiring to “insider deal”. The sentences at Southwark Crown Court bring to a close the Financial Conduct Authority’s (FCA) “Operation Tabernula” investigation which began in 2007. The FCA described it as its largest and most complex insider dealing investigation. It said the offending was “highly sophisticated” and that the investigation was “demanding and time-consuming”.
- The Coming War of Central Banks
History has shifted, and we’re leaving the era of central bank convergence and entering the era of central bank divergence, i.e. open conflict. In the good old days circa 2009-2014, central banks acted in concert to flood the global banking system with easy low-cost credit and push the U.S. dollar down, effectively boosting China (whose currency the RMB/yuan is pegged to the USD), commodities, emerging markets and global risk appetite.
- SWIFT says commercial bank hit by malware attack like $81M Bangladesh hack
SWIFT, the global financial messaging network that banks use to move billions of dollars every day, warned on Thursday of a second malware attack similar to the one that led to February’s $81 million cyberheist at the Bangladesh central bank. The second case targeted a commercial bank, SWIFT spokeswoman Natasha de Teran said, without naming it.
- Equity outflows hit nearly $90bn in 2016
Outflows from equities have hit nearly $ 90bn this year, after investors pulled $ 7.4bn from global funds in the fifth consecutive week of redemptions as they retreated into haven assets. The withdrawals have put equities “firmly” on track for their biggest year of redemptions since 2011, according to data provider EPFR. Fears over growth in Japan and the eurozone, as well as concerns over US corporate profits, are being blamed.
- UK Banks close more than 600 branches over the past year
More than 600 bank branches have closed across Britain over the past year, with rural areas worst affected, according to figures obtained by the BBC. Parts of Wales, Scotland and south west England lost the most per population between April 2015 and April 2016. Five of the top 10 areas losing banks are in Wales: Powys, Denbighshire, Gwynedd, Conwy, and Carmarthenshire. The banks said that demand for branches was falling, as more people switch to banking online.
- Third quarter investor flight wiped record $10 trillion off global stocks: BAML
Investors pulled a combined $75 billion from U.S. and emerging market equity funds in the third quarter, wiping a record $10 trillion off the value of global equities in the period, according to EPFR Global and Bank of America Merrill Lynch. In data released late on Thursday, Boston-based fund tracker EPFR Global said European and Japanese funds were the only equity classes to receive net inflows between July and September, most likely motivated by the possibility of more central bank money-printing. Funds pulled $35.2 billion from dedicated U.S. equity funds over the quarter, according to EPFR, bringing year-to-date outflows to $138 billion.
- Bank of Canada sees lower neutral interest rate
While the global economy faces a number of risks, including the potential for a shock from China, the most likely scenario is that growth continues, with some headwinds starting to slowly fade, a senior Bank of Canada official said on Wednesday. Nonetheless, the world economy’s potential growth will be lower than it was 10 years ago, partly due to demographic shifts that policy cannot fully address in the short term, Senior Deputy Governor Carolyn Wilkins said. “There are a lot of downside risks, but I would say though that the most likely thing is that the economy is going to keep growing,” Wilkins told a panel. “There’s not the typical inflation pressures you see that would result in very abrupt increases in interest rates and that’s often what triggers downturns.”
- Venezuela crisis: Maduro threatens seizure of closed factories
Venezuelan President Nicolas Maduro has threatened the seizure of factories that have stopped production, and the jailing of their owners. In a speech to supporters in the capital Caracas, he said the country had to recover the means of production, to counter its deep economic crisis. On Friday, he introduced a new, nationwide state of emergency. Opposition protesters have been rallying in Caracas to push for a recall vote to eject him from power. Mr Maduro said the state of emergency was needed to combat foreign aggression, which he blamed for Venezuela’s problems. And he said military exercises would take place next weekend to counter “foreign threats”.
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From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. Please LIKE the Lindsey Williams Online Facebook Page to see stories posted daily regarding the current state of the economy around the world.
Latest News From April 22, 2016 to April 28, 2016:
- Putin’s Decade-Old Dream Realized as Russia to Price Its Own Oil
Russian President Vladimir Putin is on the verge of realizing a decade-old dream: Russian oil priced in Russia. The nation’s largest commodity exchange, whose chairman is Putin ally Igor Sechin, is courting international oil traders to join its emerging futures market. The goal is to increase revenue from Urals crude by disconnecting the price-setting mechanism from the world’s most-used Brent oil benchmark. Another aim is to move away from quoting petroleum in U.S. dollars.
- Biggest Financial Bubble in History Will Engulf World-Gregory Mannarino
Financial analyst and stock trader Gregory Mannarino says pay no attention to the rising stock market because it is “fake.” Mannarino says, “The manipulation is absolutely epic. We have never seen anything like it. There is going to be a horrible price to pay for this. Why? Because it will correct to fair market value. There is no doubt in my mind that all of this will correct to fair value. All these distortions can only go so far, and we know this. We have seen this throughout history without exception. . . . We have the biggest bubble in the history of the world, and that is the debt bubble that has re-inflated this stock market bubble, it will burst. It will burst because every single financial bubble in history, without exception, has burst before it. This one is going to burst too, but this one is going to engulf the world. It’s going to be unlike anything we’ve seen in the history of the world, and there is no doubt that the middle class will no longer exist when this occurs. It’s going to be a massive transfer of wealth to these financial institutions that are going to go short all of this. It is legal theft on a magnitude and scale that is unimaginable.”
- How Puerto Rico’s debt bomb could blow up on the mainland
Puerto Rico, an awkward legacy of America’s 1898 testosterone spill, the Spanish-American War, is about to teach two things that few Americans know: If conditions get bad enough there, its residents, who are American citizens, can come here. And if Congress does not deal carefully with the mess made by the government in San Juan, Congress will find itself rescuing governments in Springfield, Ill., and other state capitals. Puerto Rico’s approximately 18 debt-issuing entities have debts — approximately $72 billion — they can’t repay. The Government Development Bank might miss a $422 million payment due in May, and the central government might miss a $2 billion payment in July. Congress won’t enact a US taxpayer “bailout.”
- Puerto Rico’s Governor Says the Island Will Default on Monday
Puerto Rico’s Government Development Bank has a $422 million payment due to creditors that day. Puerto Rican officials talked tough ahead of a major debt payment due on Monday, with the U.S. territory’s governor predicting default, and chances slipping for a restructuring deal with creditors. Speaking to reporters on Wednesday, Governor Alejandro Garcia Padilla said “there will be a default on Monday,” adding, “I don’t think there is a deal on the table that avoids a default.”
- Yen Surges Most Since 2010 as BOJ Refrains From Adding Stimulus
The yen surged by the most since 2010 after the Bank of Japan maintained its record stimulus, surprising traders who had expected additional easing and forcing them to exit bets on declines in the currency. Japan’s currency rose against all of its 16 major peers as BOJ Governor Haruhiko Kuroda and his colleagues opted to refrain from more policy action and to take more time to assess the impact of their negative interest-rate program. A slight majority of economists surveyed by Bloomberg predicted the central bank would respond to a strengthening yen that’s cast a shadow over prospects for higher wages and investment.
- COMEX Default Is Coming Soon-Bill Holter
According to financial writer Bill Holter, we are getting to the end of the gold and silver price suppression game. Holter contends, “Because the inventories are so small, silver and gold registered categories (at COMEX) total about $1.2 billion. That’s nothing in today’s world. That’s less than one day’s interest the U.S. pays on its debt. I don’t see this going for a long time because inventories are so small. . . . This whole suppression game on gold and silver was brought about to protect the reserve currency, the dollar, because gold is a direct competitor with the dollar. If the silver market blows up, and I shouldn’t say if, it’s when the silver market blows up, that’s going to blow the gold market up, and that is basically going to expose the fact the West is a fraud, that the gold and silver markets were a fractional reserve Ponzi scheme. That’s going to blow confidence, and you are going to see derivatives blow up all over the world, and markets will be closed in a couple of days.”
- US-Style Mortgage Fraud a ‘Nuclear Bomb’ to Australian Banks
The Australian Securities & Investments Commission (ASIC), which regulates financial services companies,has the backbone of a chicken wing when it comes to enforcing the rule of law; this is widely recognized in Australia and resulted in a Parliamentary inquiry. If any politician believes that ASIC is a “tough cop on the beat,” they should seriously reconsider their opinion on this issue. Under the pomp and ceremony of the government’s decision to levy the banks to fund ASIC’s prolonged $400 million+ annual fishing vacation is its pursuit of catching tadpoles in the open seas while leaving sharks and barracudas to freely roam. Unfortunately for the regulator, there is a new term Australians will become accustomed to. Control fraud. It refers to fraud committed by the high-ranking employees of a corporation: executives and managers, typically a bank. It’s a crime that ASIC has decided neither to investigate nor prosecute, leaving borrowers on their own with no pennies to spare and nowhere to turn to.
- Hong Kong Is Building The Biggest Gold Vault And Trading Hub In The World
Less than a week after the official launch of the Chinese Yuan-denominated gold fix on the Shanghai Gold Exchange, a historic move which represents “an ambitious step to exert more control over the pricing of the metal and boost its influence in the global bullion market” and which will gradually transform the market of paper gold trading, in the process shifting the global trading hub from west (London) to east (China), overnight Hong Kong’s Chinese Gold and Silver Exchange (CGSE) Society revealed plans to do something similar for physical gold when it announced plans for what may end up being the biggest gold vault in the world.
- Corporations Are Defaulting On Their Debts Like It’s 2008 All Over Again
The Dow closed above 18,000 on Monday for the first time since July. Isn’t that great news? I truly wish that it was. If the Dow actually reflected economic reality, I could stop writing about “economic collapse” and start blogging about cats or football. Unfortunately, the stock market and the economy are moving in two completely different directions right now. Even as stock prices soar, big corporations are defaulting on their debts at a level that we have not seen since the last financial crisis. In fact, this wave of debt defaults have become so dramatic that even USA Today is reporting on it…
- 47 Percent Of Americans Cannot Even Come Up With $400 To Cover An Emergency Room Visit
If you had to make a sudden visit to the emergency room, would you have enough money to pay for it without selling something or borrowing the funds from somewhere? Most Americans may not realize this, but this is something that the Federal Reserve has actually been tracking for several years now. And according to the Fed, an astounding 47 percent of all Americans could not come up with $400 to pay for an emergency room visit without borrowing it or selling something. Various surveys that I have talked about in the past have found that more than 60 percent of all Americans are living to paycheck to paycheck, but I didn’t realize that things were quite this bad for about half the country. If you can’t even come up with $400 for an unexpected emergency room visit, then you are just surviving from month to month by the skin of your teeth. Unfortunately, about half of us are currently in that situation.
- Halliburton says it cut 6,000 jobs in first quarter, delays earnings call
Halliburton Co said on Friday that it reduced headcount by more than 6,000 during the first quarter due to the prolonged slump in oil prices. The oilfield services provider said revenue dropped 40.4 percent to $4.2 billion in the quarter ended March 31. The company also said it would now hold its earnings conference call on May 3, instead of April 25, to accommodate the April 30 deadline for its merger with Baker Hughes Inc.
- UC Berkeley Touts $15 Minimum Wage Law, Then Fires Hundreds Of Workers After It Passes
Labor Markets: Hundreds of employees at the University of California at Berkeley are getting schooled in basic economics, as the $15 minimum wage just cost them their jobs. Too bad liberal elites “fighting for $15” don’t get it. A week after California Gov. Jerry Brown signed the state’s $15 minimum wage boost into law, UC Berkeley Chancellor Nicholas Dirks sent a memo to employees announcing that 500 jobs were getting cut.
- Economy In Decline: Apple Reports Massive Revenue Decline As iPhone Sales Plummet Dramatically
Corporate revenues in the United States have been falling for quite some time, but now some of the biggest companies in the entire nation are reporting extremely disappointing results. On Tuesday, Apple shocked the financial world by reporting that revenue for the first quarter had fallen 7.4 billion dollars compared to the same quarter last year. That is an astounding plunge, and it represents the very first year-over-year quarterly sales decline that Apple has experienced since 2003. Analysts were anticipating some sort of drop, but nothing like this. And of course last week we learned that Google and Microsoft also missed revenue and earnings projections for the first quarter of 2016. The economic crisis that began during the second half of 2015 is really starting to take hold, and even our largest tech companies are now feeling the pain.
- Apple shares plunge 7% on first drop in iPhone sales ever
Apple’s streak of iPhone-powered sales ended Tuesday when the company reported its first quarterly sales drop in more than a decade. The news sent Apple’s (AAPL) stock into a tailspin with shares plunging 6.5% to $97.55 in late trading Wednesday. CEO Tim Cook signaled a saturated smartphone market would keep a lid on sales, although he suggested the company’s new entry-level smartphone, the SE, promised to eventually goose sales among Android switchers and in emerging markets such as China and India.
- Bank-hacking malware discovery leaves 11,000 global financial institutions on high alert
Over ten thousand banks and financial institutions are being urged to remain vigilant after the secure Swift (Society for Worldwide Interbank Financial Telecommunication) system – used to send messages between global firms – was reportedly compromised by the sophisticated hacking scheme that targeted the Bangladesh central bank in March 2016. The news comes after security researchers at British defence contractor BAE Systems claimed to have uncovered a stealthy piece of malware used in the Bangladesh attack, which resulted in the loss of $81m (£56m, €71m). Previously, investigators said that cybercriminals broke into the bank’s computer networks to steal vital access credentials. However, fresh research claims that Swift was also likely compromised during the hack in order to erase records of malicious financial transfers.
- How California’s minimum wage increase will add more robotic automation in logistics
California’s minimum wage hikes are going to force logistics firms with low-paid warehouse workers to invest more heavily in robotic technology, according to Inland Empire economist John Husing. Husing said most of Southern California’s warehouse employees who earn minimum wage are working part time. But the newly approved pay hikes that will boost the state’s current minimum wage of $10 per hour to $15 per hour by 2022 will still place financial pressures on logistics companies. And they’ll be looking for ways to increase efficiency while reducing costs.
- The Ugly Truth About A $15 Minimum Wage
The Service Employees International Union spent 2015 expanding its campaign for a $15 minimum wage to other industries. In recent nationwide protests, the union focused again on its original target: Fast food companies, and McDonald’s MCD +0.19% in particular. I worked for the company for three decades, and served as its USA President for 13 years. I can assure you that a $15 minimum wage won’t spell the end of the brand. However it will mean wiping out thousands of entry-level opportunities for people without many other options.
- Australian dollar drops sharply after soft inflation data
The Australian dollar dropped two-thirds of a US cent on Wednesday after a lower-than-expected inflation reading saw markets calculating an increase in the risk of an interest rate cut. The Aussie fell to US$0.7678 to show a loss of 0.9 per cent on the day. It touched a 10-month peak of US$0.7836 last week.
- US new home sales fall amid weakness in the West
New U.S. single-family home sales unexpectedly fell in March, but the decline was concentrated in the West region, suggesting that the housing market continued to strengthen. The Commerce Department said on Monday new home sales decreased 1.5 percent to a seasonally adjusted annual rate of 511,000 units. February’s sales pace was revised up to 519,000 units from the previously reported 512,000 units.
- Another iconic British high-street brand has gone under
“Well, we have been declining for years,” reflected one despondent shop assistant at British Homes Stores (BHS) after learning that the department store had filed for administration on April 25th. The news has come as no great surprise to many of BHS’s staff and still less to the retail analysts who have been following the firm’s slow demise. Unless a buyer is found soon, the company could well be broken up, its 164 stores and stock sold off to repay creditors. That would spell the end of BHS, founded in 1928, as a high-street clothing and home-goods chain, and disaster for its 11,000 employees. Losses on this scale would simply compound the gloom that accompanied the thousands of recent job losses in the British steel industry, with more, probably, to come.
- Dallas Fed manufacturing index falls more than forecast
The Dallas Federal Reserve’s manufacturing index contracted for a 16th straight month, falling to -13.9 in April. Economists had forecast that the index rose a bit to -10 from -13.6 in March, according to Bloomberg. Although the headline index slipped, factory activity expanded for a second straight month, and production output grew. New orders, shipments and wages also increased. But labor-market indicators showed that employment was still weak.
- Austin Reed enters administration putting 1,200 jobs at risk
Menswear retailer Austin Reed has entered administration, putting almost 1,200 jobs at risk. A statement from the administrators blamed a “challenging” retail market and cash flow difficulties. The company, which has 100 standalone stores and is stocked in a further 50, has struggled to compete and has seen its sales fall. Austin Reed began in 1900 as a tailor and counted Winston Churchill as a customer. “Austin Reed is a well-regarded and iconic brand,” said Peter Saville, one of the newly appointed administrators. “We are confident that it is an attractive proposition for a range of potential buyers.” The menswear brand is the second UK retailer to enter administration in as many days, following the failure of BHS.
- America’s Department Stores May Have to Close Hundreds of Locations
That’s a quarter of their stores. To get back to their pre-recession productivity peak, the nation’s top department stores would have to close hundreds of locations, according to a leading real estate analysis firm. Chains such as Sears, J.C. Penney and Macy’s have been hit by a double whammy: the loss of market share to Amazon and specialty stores, coupled with chronic drops in shopper traffic to malls. Collectively, they would need to close some 800 stores for sales per square foot to go back to 2006 levels, Green Street Advisors wrote in a recent research note. That translates to 25% of all department stores nationwide, whose list also includes Dillard’s, Bon-Ton and Nordstrom.
- “A Total Game Changer” – From Over-Population To De-Population
Strangely, the world is suffering from two seemingly opposite trends…overpopulation and depopulation in concert. The overpopulation is due to the increased longevity of elderly lifespans vs. depopulation of young populations due to collapsing birthrates. The depopulation is among most under 25yr old populations (except Africa) and among many under 45yr old populations. So, the old are living decades longer than a generation ago but their adult children are having far fewer children. The economics of this is a complete game changer and is unlike any time previously in the history of mankind. None of the models ever accounted for a shrinking young population absent income, savings, or job opportunity vs. massive growth in the old with a vast majority reliant on government programs in their generally underfunded retirements (apart from a minority of retirees who are wildly “overfunded”). There are literally hundreds of reasons for the longer lifespans and lower birthrates…but that’s for another day. This is simply a look at what is and what is likely to be absent a goal-seeked happy ending.
- Gerald Celente – China Stock Market Crash To Create Full-Blown Global Panic, But Gold Will Shine
Today the top trends forecaster in the world told King World News that China’s stock market crash will crash along with their economy and this will create a full-blown global panic, but gold will shine. Gerald Celente: “George Soros came out earlier in the week warning about the Chinese debt bubble, which is estimated now to be at about $30 trillion, up from $500 billion twenty years ago… “Soros said: “Stimulus can buy you additional time, but it makes the problem that much bigger. That’s where we are.” So when they talk about China’s growth now at 6.7 percent, they leave out the fact that the Chinese banks pumped in some $212 billion in new local currency loans in March. There was also the social financing of another $360 billion in the month of March.
- Goldman Sachs opens to the masses
For almost 150 years Goldman Sachs has been the go-to bank of the rich and powerful. But now the Wall Street titan is opening up to the masses on Main Street by offering online savings accounts for as little as $1 on deposit.Goldman’s shift down market comes as the bank is under pressure to develop new streams of funding. Weak first-quarter results from the big US banks have highlighted the challenges faced by their investment banking units, under pressure from volatile markets and tight regulations. Analysts last week fired a barrage of questions at the US banks, and at Goldman in particular, wondering why they were not doing more to reboot their businesses. Goldman posted the lowest quarterly return on equity – just 6.4 per cent, on an annualised basis – of the past four years.
- “The Damage Could Be Massive” – How Central Banks Trapped The World In Bonds
Yields on $7.8 trillion of government bonds have been driven below zero by worries over global growth, forcing investors looking for income to flood into debt with maturities of as long as 100 years. Worse still, as Bloomberg reports, central banks’ policy is exacerbating matters, as the unprecedented debt purchases to spur their economies have soaked up supply and left would-be buyers with few options. This has driven the ‘duration’ – or risk sensitivity – of the bond market to a record high, meaning, as one CIO exclaimed, even with a small increase in rates “the positions are so huge that the damage can be massive… People are complacent.” Decelerating economic growth worldwide, combined with more aggressive stimulus measures by the Bank of Japan and the European Central Bank, pushed average yields on $48 trillion of debt securities in the BofA Merrill Lynch Global Broad Market Index to a record-low 1.29 percent this month, compared with 1.38 percent currently.
- In 1 Out Of Every 5 American Families, Nobody Has A Job
If nobody is working in one out of every five U.S. families, then how in the world can the unemployment rate be close to 5 percent as the Obama administration keeps insisting? The truth, of course, is that the U.S. economy is in far worse condition than we are being told. Last week, I discussed the fact that the Federal Reserve has found that 47 percent of all Americans would not be able to come up with $400 for an unexpected visit to the emergency room without borrowing it or selling something. But Barack Obama and his minions never bring up that number. Nor do they ever bring up the fact that 20 percent of all families in America are completely unemployed.
- Stricken shipping firm sells off its ships… for $1 each
A heavily indebted shipping firm has been forced to sell off its fleet for as little as $1 a piece as the global shipping crisis takes its toll. Goldenport Holdings said on Friday that it would sell six of its eight vessels for a token consideration of $1 each, while it would look for the best price it can get on its two remaining ships. The company will also delist from the London Stock Exchange after its debt pile spiralled “significantly higher” than the value of its fleet. The embattled shipping group has been locked in negotiations with its lenders, including RBS, since January this year in a bid to restructure its loan facilities, but within the last few weeks shareholders have given the go ahead to sell off the loss-making ships.
- Venezuela cuts power for four hours a day to save energy
Venezuela is introducing power cuts of four hours a day from next week to deal with a worsening energy crisis. The cuts will last for 40 days as the country struggles under a severe drought limiting hydroelectric output. It is the latest setback to Venezuela’s economy which has been hit by a sharp fall in the price of its main export, oil. The country’s main brewer, Polar, also says it will stop production because it has no dollars to buy grain abroad. The company, which produces 80% of the country’s beer, says 10,000 workers will be affected by the stoppage.
- This virtually guarantees that your taxes are going through the roof
I was thinking about this the other day when I read an article in the Financial Times about the “disastrous” $3.4 trillion funding hole in the United States public pension system. To be clear, they’re not talking about the Social Security mess. That’s an additional $40+ trillion funding shortfall. The $3.4 trillion gap is referring primarily to city and state pension funds; these pension funds essentially have way too many liabilities and obligation, with too few assets to support them. And the problem gets worse each year. Now, pension funds in the Land of the Free are supposed to be backed up and insured by a federal agency known as the Pension Benefit Guarantee Corporation (PBGC). The PBGC is sort of like the FDIC for pension funds. There’s just one small problem: in addition to all of these city and state pension funds that are under water, the PBGC is INSOLVENT. In its most recent annual report, the PBGC (which ensures the pension funds of more than 40 million Americans), showed net equity of NEGATIVE $76 billion. So not only do these pension funds need a bailout, but the government organization that is supposed to insure the pension funds needs a bailout…
- A Few Troubling Facts
BANKING BUSINESS – Just 4 banks in the United States hold 91% of all derivatives nationwide as of the end of 2015. The face amount of the derivative contracts held by all insured commercial banks and savings associations was $181.0 trillion as of 12/31/15. 76% of the $181.0 trillion were interest rate derivative contracts (source: Office of the Comptroller of the Currency). I am sure glad that the government has spread the risk in derivatives around.
- The Fed Sends a Frightening Letter to JPMorgan and Corporate Media Yawns
Yesterday the Federal Reserve released a 19-page letter that it and the FDIC had issued to Jamie Dimon, the Chairman and CEO of JPMorgan Chase, on April 12 as a result of its failure to present a credible plan for winding itself down if the bank failed. The letter carried frightening passages and large blocks of redacted material in critical areas, instilling in any careful reader a sense of panic about the U.S. financial system.
- “China Is Hoarding Crude At The Fastest Pace On Record”
In the aftermath of China’s gargantuan, record new loan injection in Q1, which saw a whopping $1 trillion in new bank and shadow loans created in the first three months of the year, many were wondering where much of this newly created cash was ending up. We now know where most of it went: soaring imports of crude oil. We know this because as the chart below shows, Chinese crude imports via Qingdao port in Shandong province surged to record 9.86 million metric tons last month based on data from General Administration of Customs.
- US banks endure biggest drop in revenues since 2011
The six biggest US banks have suffered their steepest decline in quarterly revenues since 2011, after a profound slump on Wall Street overshadowed a boost from their consumer businesses. JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, Morgan Stanley and Wells Fargo generated total revenues of $98bn in the first quarter, down 9 per cent from a year earlier — the steepest fall in five years, according to a Financial Times analysis of Bloomberg data. Deep cost cuts failed to counteract the fall in revenue so the six lenders also saw their collective net income plummet 24 per cent year on year to $18bn.
- Why Are The Chinese Stockpiling Silver? Big Price Move Coming?
It looks like something big may happen to the silver market and the Chinese are preparing for it. After China launched it’s new Yuan Gold Fix today, the prices of the precious metals surged. At one point today, silver was up 5%. Silver is now trading at the $17 level, a price not seen in over a year. Even though gold has taken center stage today due to Chinese rolling out there new Yuan Gold fix, something quite interesting has been taking place in the silver market over the past six months. While Comex silver inventories have been declining from a peak of 184 million oz (Moz) in July 2015 to 154 Moz today, silver stocks at the Shanghai Futures Exchange have been doing the exact opposite.
- Mario Draghi Explains Why QE ‘Will’ Work This Time – ECB Press Conference Live Feed
As expected today’s ECB statements were a snoozer, and likely Mario Draghi’s official statement will be too – “more of the same.” However, the real fun and games will come as he combats questions on 1) the lack of effectiveness of QE so far (just wait, any day now it will work), and 2) helicopter money (“whatever it takes”). He better offer some hope for moar as EUR is surging into the meeting…
- “The Men Behind The Curtain Are Being Revealed” – CEO Says Real-World Pricing To Return To Gold & Silver Markets
Astute observers of financial markets, especially in the precious metals sector, have long argued that small concentrations of major market players have been manipulating asset prices. Last week those suspicions were confirmed when Deutsche Bank, one of the world’s leading financial institutions, not only admitted to regulators that they have been involved in the racket, but that they were prepared to turn over records implicating many of their cohorts in a global scheme to suppress prices. In his latest interview with SGT Report, straight-shooting Callinex Mines CEO Max Porterfield explains that now that the men behind the curtain are being revealed, asset prices in precious metals, base metals and other commodities will return to more natural pricing mechanisms based on core supply and demand fundamentals.
- The SUNE Finally Sets: SunEdison Files For Bankruptcy
It’s over. After months of arguing that everything will be ok as investors flee the troubled company, it is now officially over: *SUNEDISON FILES FOR BANKRUPTCY AFTER ACQUISITION BINGE. As Bloomberg notes, Terraform Power and Global are not part of the filing. The company reported between $10-50 billion in assets and $10-50 billion in debt.
- In “Unprecedented Snub”, Saudi Arabia Demands “Recalibration Of Relationship” With U.S.
As Obama concludes his fourth and supposedly final meeting to Saudi Arabia as U.S. president, the White House was quick to explain where relations with the Saudi Kingdom lay, and as CNN reported this morning, moved to tamp down suggestions that ties with Saudi Arabia are fraying, with administration officials saying that President Barack Obama “really cleared the air” with King Salman at a meeting Wednesday. Which is strange because that is not how the other side saw it: even as White House officials stressed that the leaders made progress, a prominent member of the Saudi royal family told CNN “a recalibration” of the U.S.-Saudi relationship was needed amid regional upheaval, dropping oil prices and ongoing strains between the two longtime allies.
- FEDERAL EUROPE PLOT: EU draws up plans for United States of Europe behind Britain’s back
PLANS for a United States of Europe have been drawn up in a bid to give Brussels bureaucrats an iron grip over the continent, it has been revealed. In a direct challenge to David Cameron’s claims of British sovereignty, Germany, France, Italy and Luxembourg signed a document last September in Rome calling for the creation of a “general union of states”, which has only now come to light. The further integrated union would not only take a central hold over economic and fiscal matters, as well as internal markets, but would also include social and cultural affairs and foreign, security and defence policy of member states.
- George Soros Warns “China Resembles US In 2008”, Hard Landing “Practically Unavoidable”
China’s credit growth in March (and $1 trillion surge in total social financing in Q1) is a “warning sign” according to billionaire George Soros, “because it shows how much work is needed to stop the slowdown.” Speaking at an event in new York this evening, Soros commented on “troubling developments” in China, the anti-corruption drive’s impact on capital outflows and the real-estate bubble “feeding on itself.” His conclusion, rather ominously, was that despite all the naysayers and fiction-peddlers, China “resembles US in 2007-8,” before credit markets seized up and spurred a global recession. As Bloomberg reports, Billionaire investor George Soros said China’s debt-fueled economy resembles the U.S. in 2007-08, before credit markets seized up and spurred a global recession.
- One of the nation’s largest pension funds could soon cut benefits for retirees
More than a quarter of a million active and retired truckers and their families could soon see their pension benefits severely cut — even though their pension fund is still years away from running out of money. Within the next few weeks, the Treasury Department is expected to announce a crucial decision on whether it will approve reductions to one of the country’s largest multi-employer pension plans. The potential cuts are possible under legislation passed by Congress in 2014 that for the first time allowed financially distressed multi-employer plans to reduce benefits for retirees if it would improve the solvency of the fund. The law weakened federal protections that for more than 40 years shielded one of the last remaining pillars that workers could rely on for financial security in retirement.
- Negative rates put pressure on central banks to take risks
Investors ranging from small German savers to global life insurers have long complained about central banks’ use of negative interest rates. Now, however, another group is feeling the pain from negative rates — central banks themselves. European and Japanese rate cuts are putting pressure on many central banks’ returns — a source of income used to cover running costs and to provide finance ministries with profits on which they have come to rely. A poll of reserve managers from 77 central banks, entrusted with reserves worth $6tn last August, found a clear majority were changing their portfolio management strategy as a result — including taking steps such as buying riskier assets.
- Abu Dhabi Fund Calls 1MDB in Default After Missed Payment
A key Middle Eastern business partner of 1Malaysia Development Bhd. said the Malaysian state development fund has failed to make a $1.1 billion payment as part of a debt-restructuring agreement and that as a result a debt deal between the two entities has been terminated. The announcement, made in a London Stock Exchange filing by the International Petroleum Investment Company, an Abu Dhabi sovereign-wealth fund, marks a deterioration in relations between the two funds and signals fresh complications for 1MDB as it tries to work its way out from under billions of dollars of debt.
- Saudi Arabia takes out $10bn in bank loans
Saudi Arabia is raising $10bn from a consortium of global banks as the kingdom embarks on its first international debt issuance in 25 years to counter dwindling oil revenues and reserves. The landmark five-year loan, a signal of Riyadh’s newfound dependence on foreign capital, opens the way for Saudi to launch its first international bond issue. It comes as the sustained slump in crude encourages other Gulf governments, such as Abu Dhabi, Qatar and Oman, to tap international bond markets. The oil-rich kingdom, which last weekend blocked a potential deal among oil producers to freeze output and bolster prices, has burnt through $150bn in financial reserves since late 2014 as its fiscal deficit is set to widen to 19 per cent of gross domestic product this year.
- “Swimming Naked” – Chinese Corporate Bond Market Worst Since 2003
A week ago we highlight the “last bubble standing” was finally bursting, and as China’s corporate bond bubble deflates rapidly, it appears investors are catching on to the contagion possibilities this may involve as one analyst warns “the cost has built up in the form of corporate credit risks and bank risks for the whole economy.” As Bloomberg reports, local issuers have canceled 61.9 billion yuan ($9.6 billion) of bond sales in April alone, and Standard & Poor’s is cutting its assessment of Chinese firms at a pace unseen since 2003. Simply put, the unprecedented boom in China’s $3 trillion corporate bond market is starting to unravel. As Bloomberg notes, China’s leaders face a difficult balancing act.
- China Launches Yuan Gold Fix To “Exert More Control Over Price Of Gold”
Overnight a historic event took place when China, the world’s top gold consumer, launched a yuan-denominated gold benchmark as had been previewed here previously, in what Reuters dubbed “an ambitious step to exert more control over the pricing of the metal and boost its influence in the global bullion market.” Considering the now officially-confirmed rigging of the gold and silver fix courtesy of last week’s Deutsche Bank settlement, this is hardly bad news and may finally lead to some rigging cartel and central bank-free price discovery. Or it may not, because China would enjoy nothing more than continuing to accumulate gold at lower prices.
- Eric Hunsader: The Financial System Is “Absolutely, Positively Rigged”
Eric Hunsader, founder of Nanex, has been at the vanguard of warning about the dangers and the rampant fraud that the rise of high-frequency trading (HFT) algorithims have let loose in today’s financial markets. While he usually feels like a lone voice in a world happy to deceive itself, he was shocked to receive a $750,000 whistleblower award from the SEC for his efforts. He’s been sadly less shocked to see that since the award was publicly announced, the abuses he reported have only become more extreme and frequent.
- China debt load reaches record high as risk to economy mounts
China’s total debt rose to a record 237 percent of gross domestic product in the first quarter, far above emerging-market counterparts, raising the risk of a financial crisis or a prolonged slowdown in growth, economists warn. Beijing has turned to massive lending to boost economic growth, bringing total net debt to Rmb163 trillion ($25 trillion) at the end of March, including both domestic and foreign borrowing, according to Financial Times calculations. Such levels of debt are much higher as a proportion of national income than in other developing economies, although they are comparable to levels in the U.S. and the eurozone. While the absolute size of China’s debt load is a concern, more worrying is the speed at which it has accumulated — Chinese debt was only 148 percent of GDP at the end of 2007.
- China Retaliates In Trade Wars – Increases Steel Output To Record High
A funny thing happened when US slapped a major tariff on China’s steel exports… prices exploded higher. But the almost 50% surge in steel prices since mid-December back to 15-month highs have left traders equally split on what happens next. Will record production levels exaggerate a global glut amid tumbling exports and rising tariffs, or will China’s trillion-dollar surge in credit fuel yet more so-called “iron rooster” projects driving domestic demand even higher. For now, it appears the former is more likely as US Trade reps suggested further protectionism looms. Since Dec 23rd 2015 when the US imposed a 256% tariff on Chinese steel imports, composite steel prices have soared almost 50% even as exports have slipped…
- How Systems Break: First They Slow Down
The reality that cannot be spoken is that all the financial systems we believe are permanent are actually on borrowed time. One way we can judge this decline of resilience is to look at how long it takes systems to recover when they are stressed, and to what degree they bounce back to previous levels. Another is to look at the extremes the system reaches without returning to “normal”: for example, interest rates, which rather than normalizing after seven years of suppression are being pushed to negative rates by increasingly desperate central bankers. The key insight here is that financial systems and indeed economies function as natural systems. Central planning/central banker manipulation appears to control the system, but this control masks the reality that the system is increasingly fragile and prone to collapse, not just from internal dynamics but as a direct result of central bank manipulation. The warning signs of fraying resilience are all around us.
- How The American Neoconservatives Destroyed Mankind’s Hopes For Peace
When Ronald Reagan turned his back on the neoconservatives, fired them, and had some of them prosecuted, his administration was free of their evil influence, and President Reagan negotiated the end of the Cold War with Soviet President Gorbachev. The military/security complex, the CIA, and the neocons were very much against ending the Cold War as their budgets, power, and ideology were threatened by the prospect of peace between the two nuclear superpowers. I know about this, because I was part of it. I helped Reagan create the economic base for bringing the threat of a new arms race to a failing Soviet economy in order to pressure the Soviets into agreement to end the Cold War, and I was appointed to a secret presidential committee with subpeona power over the CIA. The secret committee was authorized by President Reagan to evaluate the CIA’s claim that the Soviets would prevail in an arms race. The secret committee concluded that this was the CIA’s way of perpetuting the Cold War and the CIA’s importance. The George H. W. Bush administration and its Secretary of State James Baker kept Reagan’s promises to Gorbachev and achieved the reunification of Germany with promises that NATO would not move one inch to the East.
- Intel to lay off 11% of workforce in big shift from PCs
Intel will lay off 11% of its global workforce, up to 12,000 employees, a painful downsizing aimed at accelerating its shift away from the waning PC market to one more focused on cloud computing and connected devices. In an email to employees, CEO Brian Krzanich said that after the restructuring, “I am confident that we’ll emerge as a more productive company with broader reach and sharper execution.” Intel CFO Stacy Smith said that half the workforce reduction, 6,000 people, will be accomplished by the end of this year.
- Chinese Launch Gold Price Benchmark Further Increasing Influence on World Stage
In another sign that it is becoming a major player in the world gold market, China launched twice-daily price fixing on Tuesday. According to a Bloomberg report, the move is an attempt to establish a regional benchmark that will bolster its influence in the global gold market: “The Shanghai Gold Exchange set the price at 256.92 yuan a gram ($1,233.85 an ounce) at the 10:30 a.m. session after members of the exchange submitted buy and sell orders for metal of 99.99 percent purity. Members include Chinese banks, jewelers, miners and the local units of Standard Chartered Plc and Australia & New Zealand Banking Group Ltd., according to the bourse.”
- Goldman Sachs profit slumps for fourth straight quarter
Goldman Sachs Group Inc’s profit slumped for the fourth straight quarter as market volatility hit the company’s bond trading and investment banking businesses. Goldman – the last of the big US banks to release first-quarter results – reported a 56.3 per cent fall in net income applicable to common shareholders to $1.2 billion, or $2.68 per share, for the three months ended March 31. That compared to $2.75 billion, or $5.94 per share, a year earlier, when the Wall Street bank recorded its best quarterly profit in five years.
- Why stronger growth may lie ahead after March housing starts swoon
Disregard the dismal housing starts data out Tuesday, many analysts say: a spring rebound is in the cards. Starts plunged nearly 9% in March to a seasonally adjusted annual rate of 1.09 million, the Commerce Department said Tuesday. That badly missed estimates – economists surveyed by MarketWatch had expected a pace of 1.17 million – but many analysts think the data is unreliable and the overall trend in construction is up.
- Dollar Falls to Lowest Level Since June as Housing Starts Slump
The dollar reached a 10-month low Tuesday after a government report showed new-home construction in the U.S. slipped more than projected in March, clouding Federal Reserve plans to boost interest rates. The U.S. currency weakened against most of its major peers in New York as the central bank is scrutinizing data to measure whether the economy is meeting its goals of full employment and a 2 percent inflation rate. The yen had also declined as oil and stocks rallied, damping haven demand.
- UnitedHealth Flees Sinking Obamacare After Posting $1 Billion In Losses
UnitedHealth, America’s largest health insurance provider, says it will exit from most obamacare exchanges next year, citing more than $1 billion in losses. CEO Stephen Hemsley says his company “cannot continue to broadly serve the market created by the Affordable Care Act’s coverage expansion due partly to the higher risk that comes with its customers,” as reported by the Associated Press. The announcement came after UnitedHealth revised its projection for 2016 to $650 million in losses, up from a previous estimate of $525 million, after ending 2015 some $475 million in the red. As the AP tells it, UnitedHealth had “second thoughts” almost immediately after announcing it would expand participation from four state exchanges to 34.
- Greenspan Admits The Fed’s Plan Was Always To Push Stocks Higher
Former Federal Reserve Chairman Alan Greenspan admitted in an interview with Sara Eisen that quantitative easing did what it was supposed to do, which was to inflate stock prices and drive multiple expansion. He was confused as to why things such as corporate earnings, capital spending, and productivity have declined given how much QE was pumped into the system. The answer to the riddle of course, is that QE was never intended to help fix anything fundamentally, it was as Kyle Bass said recently, simply a mechanism to transfer wealth and make the rich richer.
- These Maps Show How Vast New Infrastructure Is Bringing the World Together
There’s no better way to score points for gravitas in today’s media than claiming that the world is falling apart. Just say on air that, “This is the most dangerous time since the peak of the Cold War,” and witness your star rise. But such talking heads are responding to yesterday’s news and extrapolating the worst scenarios, whereas the underlying trends seem in fact to point in a very different direction. If you want to understand the world of tomorrow, why not just look at a good map? For my new book, Connectography, I researched every single significant cross-border infrastructure project linking countries together on every continent. I worked with the world’s leading cartography labs to literally map out what the future actually — physically — will look like.
- Americans Spend More On Taxes Than On Housing, Food And Clothing
Three weeks ago, a recent report by Pew revealed something stunning: one third – the poorest – of US households can no longer afford even the most basic necessities: food, rent and transportation. The main reason for this: while the median income had fallen by 13% from 2004 levels over the next decade, expenditures had increased by nearly 14%, driven almost entirely by soaring rent costs. “This change in the expenditure-to-income ratio in the years following the financial crisis is a clear indication of why and how households feel financially strained” Pew concluded.
- OK, I Get it, this Junk-Bond Miracle-Rally Is Doomed – And since stocks follow junk bonds…
Junk bonds started to decline in June 2014, and earlier this year threatened to implode. Contagion was spreading from the collapsing energy sector to the brick-and-mortar retail sector, telecom (Sprint), the media (iHeartMedia), and other sectors. It was really ugly out there. As junk bond prices got beaten down, yields soared. The average yield of bonds rated BB, the top end of the junk-bond scale, according to the BofA Merrill Lynch index, went from 4.2% to 7.07% between June 2014 and February 11, 2016. For CCC-and-lower-rated junk bonds – the bottom end of the scale, deemed to be within uncomfortable proximity to default – the yield of the BofA Merrill Lynch index shot up from around 8% to 21.5% between June 2014 and February 12, 2016. But then the Fed heard the screaming from Wall Street about the chaos in the markets, with junk bonds losing their grip and large swaths of stocks careening deeper into a bear market. Incapable of any independence whatsoever, it brushed rate hikes off the table and changed its verbiage. What ensued was a marvelous rally all around, particularly in bonds.
- China Ocean Freight Index Collapses to Record Low – Relentless deterioration meets stunning overcapacity
The amount it costs to ship containers from China to ports around the world, a function of the quantity of goods to be shipped and the supply of vessels to ship them, just dropped to a new historic low. The China Containerized Freight Index (CCFI) tracks contractual and spot-market rates for shipping containers from major ports in China to 14 regions around the world. It reflects the unpolished and ugly reality of the shipping industry in an environment of deteriorating global trade. For the latest reporting week, the index dropped 0.6% to 636.14, its lowest level ever. It has plunged 41% from the already low levels in February last year, and 36% since its inception in 1998 when it was set at 1,000.
- “War, Confiscation Or Redistribution” – An Anecdote On Systemic Reset
Central banks face a different problem altogether. They need to get people who’ve saved time to exchange it for something other than clever inventions that store it. They’ve largely failed. So now, everything that stores time is extremely expensive and offers little or negative return, while the pace of economic activity slows.
- Obama Administration Makes Stunning Admission: “Seed Money For Al Qaeda Came From Saudi Arabia”
Following a dramatic deterioration in official diplomatic channels between the US and Saudi Arabia when over the weekend the Saudis threatened the U.S. with dumping billions in Treasuries if Congress were to pass a bill probing into their alleged support of Sept 11 terrorists in the aftermath of last weekend’s 60 Minutes report on the classified “28 pages” from the Septemeber 11 commission, moments ago the Obama administration made a stunning admission, when for the first time it revealed on the record that the Saudis were the original source of funding for Al Qaeda. As Politico reports, Obama’s deputy national security adviser, Ben Rhodes, while speaking to David Axelrod in Monday’s edition of “The Axe Files” podcast said that the government of Saudi Arabia had paid “insufficient attention” to money that was being funneled into terror groups and fueled the rise of Al Qaeda when he was asked about the validity of the accusation that the Saudi government was complicit in sponsoring terrorism.
- Sears closing 10 stores and 68 Kmarts
The company made the announcement Thursday, saying the move is an effort to accelerate its plan to close its unprofitable stores and return to profitability. Shares rose more than 6% after hours on the news. Sears said in a statement that employees affected by these closings will get severance and the chance to apply for open positions at local Kmart and Sears stores. The company didn’t say how many jobs will be affected.
- Mobs of Angry Investors Fight Market Rigging, Maul Deutsche Bank in Class-Action Lawsuit, other Banks Next
Prior to last week, Deutsche Bank made headlines for a string of huge losses and massive exposure to risky derivatives. The last time the firm’s shares traded at prices this low, the world was in the midst of 2008’s financial apocalypse. Deutsche Bank didn’t need more bad news, but a group of investors who brought suit against the massive German bank for cheating them by rigging the London “fix” price for gold and silver certainly must be smiling. Last week, the bank offered to settle their class action suit for an undisclosed amount.
- This Also Happened the Last 2 Times before Stocks Crashed
Something that happened just before the prior two market crashes, and the recessions that accompanied them, including the Great Recession, is happening again: the boom in financial engineering is starting to backfire against the companies doing it. Their credit ratings are getting slashed, and their borrowing costs are therefore rising, even while they need newly borrowed money to buy back even more shares to keep the charade going. Until the music stops. Downgrades ascribed to “shareholder compensation,” as Moody’s calls share buybacks and dividends, have been soaring, according to John Lonski, Chief Economist at Moody’s Capital Markets Research. The moving 12-month sum of Moody’s credit rating downgrades of US companies, jumped from 32 in March 2015, to 48 in December 2015, and to 61 in March 2016, nearly doubling within a year.
- U.S. Economy 2016: 3 Classic Recession Signals Are Flashing Red
Those that were hoping for an “economic renaissance” in the United States got some more bad news this week. It turns out that the U.S. economy is in significantly worse shape than the experts were projecting. Retail sales unexpectedly declined in March, total business sales have fallen again, and the inventory to sales ratio has hit the highest level since the last financial crisis. When you add these three classic recession signals to the 19 troubling numbers about the U.S. economy that I wrote about last week, it paints a very disturbing picture. Virtually all of the signs that we would expect to pop up during the early chapters of a major economic crisis have now appeared, and yet most Americans still appear to be clueless about what is happening.
- PBOC calls for broadening use of IMF’s basket of reserve currencies
Chinese central bank governor Zhou Xiaochuan on Saturday called for broadening the use of the International Monetary Fund (IMF)’s basket of reserve currencies to advance the reform of the International Monetary System (IMS). “The IMS has inherent deficiencies and faces new challenges from globalization, financial innovation, and volatility in capital flows,” Zhou said in a statement for the meeting of the International Monetary and Financial Committee (IMFC), the IMF’s policy setting committee, on the sidelines of the spring meetings of the IMF and the World Bank. The IMF announced it will add the Chinese yuan to its basket of reserve currencies last year. The addition will take effect Oct. 1, 2016, with the yuan having a 10.92 per cent weighting in the basket, the IMF said. “The SDR has the potential to resolve the existing deficiencies in the IMS,” Zhou said in Washington, referring to the Special Drawing Right, an international reserve asset created by the IMF in 1969.
- Precious Metals Puke – ‘Someone’ Dumps $2 Billion Of Gold Into Futures Markets
What goes up… must not be allowed to… Someone just decided this was the perfect time to dump over $2 billion worth of notional paper gold onto the markets… Over 16,000 gold contracts (and 7,500 silver) were dumped in that 5/10 minutes segment. It appears Draghi did not like the impression of his impotence that precious metals were suggesting. It appears the Gold/Silver ratio at 72x was a big buying opportunity?
- Collapse Strategist: “We’re In The Terminal Phase… Economic Pain Like We’ve Never Seen Before”
At this point, despite major highs in U.S. stock markets and reassurances from no less than President of the United States himself that the economy is sound, one only need to look around to understand that we are on the cusp of what researcher and collapse strategist Michael Snyder of The Economic Collapse Blog calls the “early chapters of a total meltdown.” In his latest interview with Future Money Trends Snyder notes that the fundamental economic problems we face can be seen across the globe. The United States, Europe, Asia, and South America are all crashing and no one will be immune to what comes next.
- Empire of Empty Dreams: “Chances of Securing a Better Life Are Declining”
The next few years will strip away the illusions of “growth” and reveal which dominates our society and economy: privilege or social mobility. Among the many lessons of empires is one shared by virtually every empire:once the privileged few limit the rise of those from humble origins (i.e. social mobility), the empire is doomed to rising instability and collapse. The greater the concentration of wealth and power, the lower the social mobility; the lower the social mobility, the greater the odds that the system will collapse when faced with a crisis that it would have easily handled in more egalitarian times.
- The Ruble Is the Most Gold-Backed Currency in the World
The economic situation is increasingly chaotic. The world economy is out of control. We target inflation, and it doubles. Talk about transitioning to a new direction results in a further degradation of the economy. ‘De-offshorization’ got us more foreign equity in our corporations and industries. Import substitution resulted in further price rises. This growing crisis is due to two things: our increasing dependence on the America-centric financial system, and American aggression, which we must resist. There’s clearly a dissonance between our financial and economic dependence on a foreign system and the need to pursue a sovereign foreign policy in order to survive.
- Opinion: Why this market rally looks like a classic investor trap
The U.S. stock market’s rally from its dismal start to the year appears to be a classic investor trap. Many investors have the tendency to jump in a bit too early on first signs of improvement in economic indicators or positive news. But the markets are primed to trap the solvent investors and fool the most rational among us. Nowadays, in a world of high-frequency trading and speculative derivatives, it is hard for even the most experienced investors to stay rational, let alone be clear on whether to buy or hold or sell. This is why so many experts on Wall Street are giving so much conflicting advice. Current forecasting science and predictive models are not yet developed enough to time the market for the next month or quarter.
- China Embracing Gold in Advance of Post Dollar Era
To challenge the US dollar hegemony and increase its power in the global realm of finance, China has a potent gold strategy. Whilst the State Council is preparing itself for the inevitable decay of the current international monetary system, it has firmly embraced gold in its economy. With a staggering pace, the government has developed the Chinese domestic gold market, stimulated private gold accumulation and increased its official gold reserves in order to ensure financial stability and support the internationalisation of the renminbi.
- When Money Fails
Money seldom fails, but occasionally, it does. It failed in Germany and Austria 1921-23. It failed in Hungary after World War II. It failed in Zimbabwe in 2008-9, when the rest of the world was in a recession.
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From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. Please LIKE the Lindsey Williams Online Facebook Page to see stories posted daily regarding the current state of the economy around the world.
Latest News From April 15, 2016 to April 21, 2016:
- ALERT: Legend Just Warned That All Hell Is About To Break Loose
Egon von Greyerz: “The global economy turned down in earnest in 2006, but with a massive worldwide printing and lending program, the world has had a temporary stay of execution. But the effect of this fabricated money has now come to an end…
- Great Dangers Now Threaten To Destroy The Global Financial System
John Embry: “Eric, last week was interesting when you tied together a number of developments that occurred. Deutsche Bank publicly acknowledged its manipulation of the silver fix. But this is just the tip of the iceberg considering the true scope of the manipulation in silver being conducted primarily by JP Morgan…
- Nine Meals from Anarchy
In 1906, Alfred Henry Lewis stated, “There are only nine meals between mankind and anarchy.” Since then, his observation has been echoed by people as disparate as Robert Heinlein and Leon Trotsky. The key here is that, unlike all other commodities, food is the one essential that cannot be postponed. If there were a shortage of, say, shoes, we could make do for months or even years. A shortage of gasoline would be worse, but we could survive it, through mass transport or even walking, if necessary.
- Chart: US Produces More Energy Than Ever Before
America is producing more energy than ever before thanks to a boom in oil and natural gas, according to a Monday report by the Energy Information Administration (EIA). American oil production increased by 8 percent and natural gas increased by 5 percent in 2015, according to the EIA report. The boom in oil and gas helped offset the enormous 10 percent decline in U.S. in coal production. The increase had little to due with wind or solar power, as American production of green energy remained flat. Overall, America has produced more energy 6 years in a row.
- World Economy Is Terminally Broken After 50 Years Of Misgovernment
In a world of manipulated economic figures and markets, it is not always easy to maintain your sanity. The world economy is now based on fantasy and hope and has very little to do with reality. But the problem is that virtually nobody understands this. Whether it is a bank analyst or a Nobel Prize winner in economics, they are all spreading the same false message. The Western press and news media are just reporting what governments and the elite are telling them. There is no analysis and no attempt to find the truth in anything. This is why we are now in an era of indoctrination and total brainwashing of the masses. Most people are totally apathetic and incapable of realising that they are being led down a path, both morally and economically, that will make life on earth a lot more difficult not just for the present generation but probably for several generations to come.
- Last time the Saudis opened the spigots the stock market crashed and Soviet Union collapsed
If there’s a certain retro feeling in the air, it’s not just because everyone’s talking about a Donald Trump presidential run and a song called “Me Myself & I” is in the charts. Oil markets are also starting to have a distinctly 1986 feel to them. The collapse of the weekend’s oil talks in Doha heralds a phase where open spigots will drive prices lower once again. Brent crude fell as much as 7 per cent when it opened after the meeting broke up in disarray. Saudi Arabia and other Gulf producers refused to cut production unless they could get a matching agreement from an Iran that hadn’t even bothered to attend the talks.
- America 1956 vs. America 2016
Is America a better place today than it was back in 1956? Of course many Americans living right now couldn’t even imagine a world without cell phones, Facebook or cable television, but was life really so bad back then? 60 years ago, families would actually spend time on their front porches and people would actually have dinner with their neighbors. 60 years ago, cars were still cars, football was still football and it still meant something to be an American. In our country today, it is considered odd to greet someone as they are walking down the street, and if someone tries to be helpful it is usually because they want something from you. But things were very different in the middle of the last century. Men aspired to be gentlemen and women aspired to be ladies, and nobody had ever heard of “bling”, “sexting” or “twerking”. Of course life was far from perfect, but people actually had standards and they tried to live up to them.
- Jubilee Jolt: In Historic Move G20 Wipes Out Tax Haven Anonymity – ‘Market Integrity At Stake’
Breaking news from Agency France Presse (AFP): The G20 has just “embraced a crackdown” on tax haven-corporations and shell companies that will savagely and decisively rip away the last remaining vestiges of financial privacy here on Earth. This is a huge change, almost incomprehensible. In a single month, from start to finish, privacy assurances that have existed for centuries are being stripped away. Less than two weeks ago, the Panama Papers (PP) were strategically leaked and we reported, “Financial Elite’s Attack on Worldwide Privacy“. We said it was almost surely a planned leak by financial elites to bring in more worldwide capital controls.
- Is Deutsche Bank’s Gold Manipulation The Main Scam Or Just A Side-Show?
For years now, the easiest way to finesse a debate over whether precious metals markets are manipulated has been to say, “well, if they’re not manipulated they’re the only market that isn’t.” That was unsatisfying, though, because as the big banks got caught scamming their customers on interest rates, mortgage bonds, forex and commodities trades, those markets (presumably) began to operate more-or-less honestly. Gold and silver, meanwhile, kept right on acting strangely, for instance plunging in the middle of the night on no news but massive futures volume, to the detriment of honest investors and traders who naively bet their capital on fundamentals. The (already huge) amount of money thus stolen from gold bugs kept rising.
- Institutionalized Lying—— Why Central Bankers Never See Bubbles
Every day there is more confirmation that the casino is an exceedingly dangerous place and that exposure to the stock, bond and related markets is to be avoided at all hazards. In essence the whole shebang is based on institutionalized lying, meaning that prouncements of central bankers, Wall Street brokers and big company executives are a tissue of misdirection, obfuscation and outright deceit. And they are self-reinforcing, too. As we indicated in our post over the weekend (The Keynesian House Of Denial), it’s all definitional by the lights of today’s central bankers and their Wall Street camp followers. Since the former are busy “accommodating”, massaging and “stimulating” economies all around the world—- bad things like recessions and stock market busts just can’t happen.
- How to Profit as the New Gold Standard Takes Hold
Has Doug Casey convinced the government to bring back the gold standard? Over the past two weeks, Doug has been working on a special project. He’s spent a lot of time with high-ranking government officials, trying to persuade them to back the currency with gold. Believe it or not, the government is taking Doug’s ideas seriously… Unfortunately, we’re not talking about the U.S. government. As you may know, America gave up on the gold standard in 1971. Prior to that, folks could exchange their U.S. dollars for a fixed amount of gold. This kept the government honest and prevented it from printing too much money. Today, U.S. dollars are merely paper, backed by nothing. Or, as Doug says, the dollar is an “I.O.U. nothing.”
- The oil deal that never came to be
ANALYSIS: It was supposed to be the easiest deal ever reached among key oil market players, a mere formality. Eighteen countries were gathering in the Qatari capital of Doha to rubber-stamp the first joint agreement between major OPEC and non-OPEC nations in 15 years, tackling a huge global glut after flooding the market for two years. The text was agreed and the timeframe was clear. Oil prices were rising. Traders were calling the event boring. Then, the first clouds began to appear.
- We might be repeating the mistakes of the 1999 bubble and crash
The stock market may be in danger of repeating some very bad history. The current market environment is looking a whole lot like the 1998-1999 stock market bubble, and the crash of 2000 may not be far behind, said Michael Hartnett of Bank of America Merrill Lynch. “It could simply be 1998/99 all over again. After all, a ‘speculative blow-off’ in asset prices is one logical conclusion to a world dominated by central bank liquidity, technological disruption & wealth inequality,” he wrote in a note Sunday.
- Wall Street banks are getting hammered by the markets — but not the businesses you’d expect
Volatile financial markets took a bite out of earnings at big U.S. banks during the first quarter – not just in trading but wealth management, too. On Monday, Morgan Stanley joined Wells Fargo & Co and Bank of America Corp in reporting weaker wealth management profits, citing less client activity and “an unfavorable market environment” – not to mention fewer trading days than the year-ago period.
- Why All Central Planning Is Doomed to Fail
We’re still thinking about how so many smart people came to believe things that aren’t true. Krugman, Stiglitz, Friedman, Summers, Bernanke, Yellen – all seem to have a simpleton’s view of how the world works. A bunch of famous people with a simpleton view of how the world works…who not only seriously think the economy can and should be “planned”, but arrogantly believe they are the ones who should do it. It’s a bit like the crazy guy who doesn’t know he’s crazy.
- Nomi Prins Reveals A Shocking Private Conversation About The Fed’s Manipulation Of The World
Everything that is happening in the world right now is very connected and predicated on the zero interest rate policy that emanates from the Federal Reserve. Even though we are in the 8th year of that policy and we talk about what Janet Yellen is going to say and do, what’s actually happening is that speculative money, cheap money, continues to flow in and out of places legally and illegally. As an example, the Panama Papers story broke while I was in Brazil. But legally or illegally, the money finds places to be involved for a short-term speculative bet and then it leaves much more quickly.
- What Puerto Rico can teach rural California about minimum wage increases
They’re looking for work in Colusa County, California, but it’s hard to find. It’s also hard to believe there could be a small corner of America – where the national unemployment rate on the national level is down to 5 percent – where more than one-in-five working age adults are unemployed. But that’s the reality in the county of 21,000 people in the Central Valley, a part of the state where nearly every county has unemployment rates two, three or, in Colusa County, four times the national average. No jobs and no work means other problems soon follow.
- As Minimum Wage Marches Toward $15, Small Businesses Adapt
In the aftermath of California and New York becoming the first states to raise the statewide minimum wage to $15, some small businesses with hourly workers are rethinking how they can absorb the increase. The owners of Dog Haus, a chain of about 20 franchise restaurants in the West, may have customers pick up their meals at the counters in two company-owned stores instead of using servers to carry food to tables in the two company-owned stores. The Pasadena, California-based company is also looking at hiring more experienced workers who can shoulder more responsibilities than entry-level staffers who earn minimum wage. For example, a cashier might now take on some administrative tasks. That way, Dog Haus could hire fewer people.
- California minimum wage hike hits L.A. apparel industry: ‘The exodus has begun’
Los Angeles was once the epicenter of apparel manufacturing, attracting buyers from across the world to its clothing factories, sample rooms and design studios. But over the years, cheap overseas labor lured many apparel makers to outsource to foreign competitors in far-flung places such as China and Vietnam. Now, Los Angeles firms are facing another big hurdle — California’s minimum wage hitting $15 an hour by 2022 — which could spur more garment makers to exit the state. Last week American Apparel, the biggest clothing maker in Los Angeles, said it might outsource the making of some garments to another manufacturer in the U.S., and wiped out about 500 local jobs. The company still employs about 4,000 workers in Southern California.
- Saudi Arabia Warns of Economic Fallout if Congress Passes 9/11 Bill
Saudi Arabia has told the Obama administration and members of Congress that it will sell off hundreds of billions of dollars’ worth of American assets held by the kingdom if Congress passes a bill that would allow the Saudi government to be held responsible in American courts for any role in the Sept. 11, 2001, attacks. The Obama administration has lobbied Congress to block the bill’s passage, according to administration officials and congressional aides from both parties, and the Saudi threats have been the subject of intense discussions in recent weeks between lawmakers and officials from the State Department and the Pentagon. The officials have warned senators of diplomatic and economic fallout from the legislation.
- Connecticut Chooses to Cut Jobs Over Increased Taxes in Budget Crisis
Like some other states, Connecticut is facing a budget shortfall. And in part because of its shrinking finance sector and dependence on personal income taxes for revenue, state lawmakers, a majority of whom are Democrats, are finding themselves in a fiscal pickle. Forced to rely heavily on its highest earners to fill the state’s coffers, and fearful of alienating more of the highest-earning residents after a tax increase last year, legislators are not entertaining additional taxes on the rich.
- What Did Fed Chairman Yellen Tell Obama?
This week, President Obama and Vice President Biden held a hastily arranged secret meeting with Federal Reserve Chairman Janet Yellen. According to the one paragraph statement released by the White House following the meeting, Yellen, Obama, and Biden simply “exchanged notes” about the economy and the progress of financial reform. Because the meeting was held behind closed doors, the American people have no way of knowing what else the three might have discussed. Yellen’s secret meeting at the White House followed an emergency secret Federal Reserve Board meeting. The Fed then held another secret meeting to discuss bank reform. These secret meetings come on the heels of the Federal Reserve Bank of Atlanta’s estimate that first quarter GDP growth was .01 percent, dangerously close to the official definition of recession.
- OPEC’s oil crisis talks stumble as Iran refuses to freeze output
Oil prices could fall again as big exporting nations struggled to agree a plan to freeze production, despite holding crisis talks over the weekend to search for a way to push up prices. Prices have fallen precipitously over the past two years as a fall in demand combined with a big rise in production from sources such as shale flooded the market with oil. Ministers from OPEC countries including Saudi Arabia, Qatar and Venezuela plus other major oil producers such as Russia met in Doha to discuss a plan to limit production and protect their profits. But Iran decided to stay away from the meeting as it does not want to cap its own production, in a move which could limit the effectiveness of any plan struck by the other nations – and which has raised tensions with Saudi Arabia.
- HSBC: Helicopter money is already here and no-one has noticed
Central banks have a problem. Their usual methods of stimulating the economy, like ultra-low interest rates, don’t seem to be working as well as they used to. Inflation and growth are stuck at low levels in the Eurozone after years of near-zero interest rates. It’s time to get a bit more radical and central banks have talked of using so-called helicopter money – which involves creating new money and giving it directly to people to spend on whatever they want. The American economist Milton Friedman first proposed the idea of helicopter money in 1969 i n a paper called The Optimum Quantity of Money.
- Coal giant Peabody Energy files for Chapter 11 bankruptcy
The nation’s largest coal company, Peabody Energy (BTU), filed for Chapter 11 bankruptcy protection Wednesday as the coal industry grapples with the fallout of low natural gas prices, costly regulations and China’s economic slowdown. St. Louis-based Peabody, which traces its corporate roots to 1883, had warned in March that “sustained depressed” coal prices had placed it on the edge of insolvency.
- 101 Years Of The Income Tax (In 1 Depressing Table)
More is always better, right? As we noted previously, if you hate taxes, you are far from alone. According to NBC News, here are some of the things that Americans would rather do than pay taxes… Six percent would rather sell a kidney, eight percent would rather name their first-born “Taxes,” and 11 percent would rather spend three years cleaning the bathrooms at noro-torious Chipotle. Of course our system was never intended to be like this anyway. Our founders hated taxes, and they fought a very bitter war to escape the yoke of oppressive taxation. During his very first inaugural address, Thomas Jefferson clearly expressed what he thought about taxes… “A wise and frugal government… shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government.” Why couldn’t we have listened to him?
- U.S. Industrial Production Fell in March
U.S. industrial output slowed in March, a sign that weakness persists for manufacturers and the energy industry. Industrial production—a broad gauge of output across U.S. factories, mines and power plants—decreased a seasonally adjusted 0.6% in March from the prior month, the Federal Reserve said Friday. Output has fallen for six of the past seven months. From a year earlier, industrial production decreased 2% in March. Manufacturing output, the largest component of the index, fell 0.3% in March.
- US Industrial Production Plunges As March Auto Manufacturing Tumbles Most Since 2008
The US economy has never – ever – seen Industrial Production drop YoY for seven months in a row without being in a recession. Down 2.0% YoY in March, the weakest since December and down 0.6% MoM (weakest since Feb 2015) the decline in factory output is driven a 1.6% plunge in vehicle production (2.8% collapse in motor vehicles specifcally) in March. This 1.76% drop is the worst for a March since 2008.
- U.S. Consumer Sentiment Fell for Fourth Straight Month
Consumer confidence fell for the fourth straight month in April amid growing concerns about weaker economic growth. The University of Michigan preliminary consumer sentiment index for April, released Friday, registered at 89.7, compared with a final March reading of 91.0. April’s reading was the lowest since September 2015. Economists surveyed by The Wall Street Journal had expected the April index would rise to 92.0.
- “It’s Getting Worse” – Economic Outlook Plummets In Gallup Poll, Rising Gas Prices Blamed
According to the latest Weekly Economic Confidence poll released by Gallup, Americans’ confidence in the US economy is getting worse. The poll asks people to rate the economy as of today, and whether or not the economy as a whole is getting better or worse. It turns out that ordinary people are not as excited about the US economy as those who are cheerleading minimum wage job creation and market levels being close to all time highs, and certainly not as excited as that group of people called each month by either the Conference Board or UMich, the two far more closely tracked confidence indicators. The Economic Confidence Index for the week ending April 10th came in at -14. Down from the prior week, and hitting a low not seen since the first week of November last year.
- Americans Not Buying what the Fed Is Selling
Here’s some free advice for the Federal Reserve. It’s OK. You can tell them. They already know. As Peter Schiff pointed out on CNBC yesterday, the Fed doesn’t really want to raise interest rates. We just witnessed what even a small nudge upward did to the stock markets after years of low rates and monetary policy artificially pumped them up. But on the other hand, the Fed doesn’t want to admit the US economy really isn’t in great shape.
- Baker Hughes US Oil Rig Count Drops 3 More to 351
Baker Hughes reported the active oil rig count fell by 3 more rigs to 351 for the week ending April 15. The total number of active oil and gas rigs declined by 3 to 440. This is the seventeenth week in a row the combined oil and gas rig count has declined, moving further into record low territory. It is the fourth week in a row for oil-rigs only, pushing the count to the lowest levels since the fourth quarter of 2009. For the week ending April 8 the energy company said 7 combined oil and gas rigs went offline, bringing the total number of oil and gas rigs down to 443. The oil-rigs only count fell by 8 to 354.
- Nomi Prins Just Issued A Dire Warning About What Is Going To Trigger Total Global Collapse
Nomi Prins: “We (already) have inflation. Will the bond market deflate? It absolutely will deflate when these policies run out of steam or get taken off the table. And that is why central banks keep coordinating and are so afraid to go back on what they started in 2008. If any of these policies were to have been working for real economic growth, they wouldn’t need to have gone on for this many years, which means they actually have only existed in order to help inflate assets in the financial system and to create liquidity that would have otherwise not been there for these assets.
- 10 Years of Fracking: Its Impact on Our Water, Land and Climate
In a single year, fracking wells across the country released at least 5.3 billion pounds of the potent greenhouse gas methane, as much global warming pollution as 22 coal-fired power plants. The statistic is one of many in a new study by Environment America Research & Policy Center that quantifies the environmental harm caused by more 137,000 fracking wells permitted since 2005.
- New UN report finds almost no industry profitable if environmental costs were included
If you haven’t been paying attention, I don’t blame you for at first not believing this. After all, companies go to great lengths to greenwash their image and present themselves as progressive and environmentally responsible, even while they turn your land to deserts and your oceans into dead zones. Unfortunately, as Mark Twain once famously said: “It’s easier to fool people than to convince them that they have been fooled.”
- FTSE falters on China and UK construction, with housebuilders sliding
Leading shares are slipping lower after China’s economy saw a slowdown in the first quarter, albeit in line with expectations. But the biggest fallers in the UK index were closer to home. Following Persimmon’s cautious trading update on Thursday, housebuilders are leading the way down, with Berkeley Group 106p lower at £28.70, Taylor Wimpey down 4.2p at 172.8p and Persimmon itself falling 21p to £18.79. The falls come despite UK contruction data showing housebuilding recording quarterly growth of 6.8%, the biggest rise since March 2014. Also heading lower is InterContinental Hotels, down 52p to £28.76 as JP Morgan moved from neutral to underweight on worries about its pipeline of rooms.
- Three Historical Patterns Point to Passover 2016 As Major Turning Point
The Jewish feast of Passover is known as a time of major turning points in history. Three historical patterns are now indicating another major turning point is coming during Passover 2016. King Solomon discovered there is an appointed time, a set time for everything and for every event under heaven” (Ecclesiastes 3:1). Nothing just happens randomly. Everything happens at a set time following patterns, seasons of time, which are as predictable as sunrise and sunset.
- Deutsche Bank Admits It Rigged Gold Prices, Agrees To Expose Other Manipulators
Well, that didn’t take long. Earlier today when we reported the stunning news that DB has decided to “turn” against the precious metals manipulation cartel by first settling a long-running silver price fixing lawsuit which in addition to “valuable monetary consideration” said it would expose the other banks’ rigging having also “agreed to provide cooperation to plaintiffs, including the production of instant messages, and other electronic communications, as part of the settlement” we said “since this is just one of many lawsuits filed over the past two years in Manhattan federal court in which investors accused banks of conspiring to rig rates or prices in financial and commodities markets, we expect that now that DB has “turned” that much more curious information about precious metals rigging will emerge, and will confirm what the “bugs” had said all along: that the precious metals market has been rigged all along.”
- Why is this country so poor?
“What is it about this place that makes it so poor?” It was a simple question posed to me by a friend as we walked the streets of Managua, Nicaragua earlier this week. Nicaragua is a lovely place. But it’s poor. Very poor. It’s the least developed economy in Central America… and that’s saying something. But it’s worth considering: what makes an economy like Nicaragua so poor? And what makes others so wealthy? Having traveled to nearly 120 countries, I’ve seen the full range of rich and poor nations. And I’ll tell you, it has nothing to do with natural resources or anything like that. I often have meetings with senior ministers and government officials around the world who tell me all about the amazing resources they have in their country. “We have so much forestry land,” or, “Our bauxite reserves are among the highest in the world…” Irrelevant. Venezuela has incredible oil reserves. Yet they’ve been living in poverty for years.
- Deutsche Bank Confirms Silver Market Manipulation In Legal Settlement, Agrees To Expose Other Banks
Back in July of 2014, we reported that in an attempt to obtain if not compensation, then at least confirmation of bank manipulation in the precious metals industry, a group of silver bullion banks including Deutsche Bank, Bank of Nova Scotia and HSBC (later UBS was also added to the defendants) were accused of manipulating prices in the multi-billion dollar market. The lawsuit, which was originally filed in a New York district court by veteran litigator J. Scott Nicholson, a resident of Washington DC, alleged that the banks, which oversee the century-old silver fix manipulated the physical and COMEX futures market since January 2007. The lawsuit subsequently received class-action status. It was the first case to target the silver fix. Many expected that this case would never go anywhere and that the defendant banks would stonewall indefinitely: after all their legal budgets were far greater than the plaintiffs.
- Gold resurgence: who’s buying gold and why
After four years of sharp falls, a sudden revival has been taking place in the gold market. In the first three months of 2016 the price of the yellow metal soared by 20pc – its best quarterly performance since the financial crisis erupted in the final three months of 2008. The gold price, currently around $1,260 an ounce, is well below its record peak of almost $1,900 achieved in July 2011, at the height of the European sovereign debt crisis. For investors who have missed out on the rally so far, the big question is: has gold turned a corner, suggesting that it will continue to rise, or will it crash back down to earth? As gold pays no income, it is difficult to value. Therefore, unlike an individual share or stock market index, it is less clear whether the metal is cheap or expensive at its current price.
- Hate Taxes? You Certainly Are Not Alone…
At this time of the year, millions of Americans are rushing to file their taxes at the last minute, and we are once again reminded just how nightmarish our system of taxation has become. I studied tax law when I was in law school, and it is one of the most mind-numbing areas of study that you could possibly imagine. At this point, the U.S. tax code is somewhere around 4 million words long, which is more than four times longer than all of William Shakespeare’s works put together. And even if you could somehow read the entire tax code, it is constantly changing, and so those that prepare taxes for a living are constantly relearning the rules. It has been said that Americans spend more than 6 billion hours preparing their taxes each year, and Politifact has rated this claim as true. We have a system that is as ridiculous as it is absurd, and the truth is that we don’t even need it. In fact, the greatest period of economic growth in all of U.S. history was when there was no income tax at all. Why anyone would want to perpetuate this tortuous system is beyond me, and yet we keep sending politicians to Washington D.C. that just keep making this system even more complicated and even more burdensome.
- IMF warns of fresh financial crisis
The International Monetary Fund has highlighted risks of a new financial crisis, warning that global output could be cut by 4% over the next five years by a repeat of the market mayhem witnessed during the 2008-9 recession. The IMF used its half-yearly global financial stability report to call for urgent action on the problems of banks in the eurozone, a third of which it said faced “significant challenges” to be sustainably profitable. “In the euro area, market pressures also highlighted long-standing legacy issues, indicating that a more complete solution to European banks’ problems cannot be further postponed,” the Fund said. It said there needed to be a comprehensive strategy to deal with €900bn (£715bn) of non-performing loans (NPLs) on the books of eurozone banks, adding that banks also needed to be closed in order to deal with excess capacity.
- UK government’s fracking definition ‘could allow drilling without safeguards’
The UK government has been accused of including a large loophole in its legal definition of fracking which could enable companies to bypass safety regulations, according to a leading geologist. In rules that came into force on 6 April, fracking is defined by the amount of high-pressure fluid used to fracture shale rocks and release gas or oil. However, the only well fracked in the UK so far, which caused small earthquakes near Blackpool in 2011, would not qualify as fracking under the definition. Furthermore, according to Prof Stuart Haszeldine at the University of Edinburgh, analysis of more than 17,000 gas wells fracked in the US from 2000-10 shows 43% would not be defined as fracking under UK rules. More than 4,500 US wells were fracked to release oil in that time but 89% would not be covered by the UK definition.
- 100,000 Italians sign petition for eurozone exit referendum
Italy’s Five Star Movement (M5S) party has collected more than 100,000 signatures on a petition calling for a law that would allow a referendum on withdrawal from the eurozone. M5S MP Carlo Sibila says he expects a referendum to take place at the start of next year. Though the petition has already surpassed the required amount of signatures needed for the initiative, Sibila said that he hopes it will gather another 50,000 by early May in order to highlight the issue.
- Austria Just Announced A 54% Haircut Of Senior Creditors In First “Bail In” Under New European Rules
Just over a year ago, a black swan landed in the middle of Europe, when in what was then dubbed a “Spectacular Development” In Austria, the “bad bank” of failed Hypo Alpe Adria – the Heta Asset Resolution AG – itself went from good to bad, with its creditors forced into an involuntary “bail-in” following the “discovery” of a $8.5 billion capital hole in its balance sheet primarily related to ongoing deterioration in central and eastern European economies. Austria had previously nationalized Heta’s predecessor Hypo Alpe-Adria-Bank International six years ago after it nearly collapsed under the bad loans it ran up when it grew rapidly in the former Yugoslavia. Having burnt through €5.5 euros of taxpayers’ money to prop up Hypo Alpe, Finance Minister Hans Joerg Schelling ended support in March 2015, triggering the FMA’s takeover. This was the first official proposed “Bail-In” of creditors, one that took place before similar ad hoc balance sheet restructuring would take place in Greece and Portugal in the coming months. Or rather, it wasn’t a fully executed “Bail-In” for the reason that creditors fought it tooth and nail.
- IMF says Britain leaving the EU is a significant risk
A British vote to leave the EU risks causing severe economic and political damage to Europe that will spill over into an already febrile world economy, the International Monetary Fund has warned. Cutting its forecasts for global growth and for the UK and other advanced economies, the IMF listed a potential Brexit vote in June’s EU referendum as a key risk in its latest World Economic Outlook (WEO). “In the United Kingdom, the planned June referendum on European Union membership has already created uncertainty for investors; a ‘Brexit’ could do severe regional and global damage by disrupting established trading relationships,” said Maurice Obstfeld, IMF economic counsellor. The Washington-based Fund said economic growth was also threatened by a host of other factors, including “the tragedy of large-scale refugee inflows” to Europe, a potential reappearance of financial market turmoil, China’s difficult economic rebalancing and growing income inequality.
- As Minimum Wages Go Up, Amazon.com Looks Like the Big Winner
Minimum wages are going up around the country. As the Fight for $15 spreads, several major retailers have lifted their base pay, and states and cities have enacted gradual wage hikes to $15/hour. California, the state that more than one out of 10 Americans calls home, passed a bill last week enacting incremental hikes in the minimum wage from $10/hour today to $15/hour in 2022, or a compound annual rate of nearly 9%, for businesses with at least 25 employees. Next year, the wage will rise to $10.50/hour. New York followed suit with a similar law, mandating an increase to $15/hour by 2019 in New York City and 2022 in the suburbs, and to $12.50 by 2021 in upstate New York. Several other cites, including Seattle, San Francisco, Los Angeles, Portland, Ore., and Washington, D.C., have also passed aggressive minimum wage hikes recently.
- There’s No Free Lunch With The Minimum Wage
This is not just the normal economic observation that there’s no such thing as a free lunch: there’s always costs to something, not just benefits. Rather this is the quite literal observation that cranking up the minimum wage leads to a disappearance of the free lunch itself. Over in my native UK George Osborne has imposed a remarkably silly “national living wage” which is intended to rise to 60% of median earnings soon enough. That’s too high for a minimum wage (the general consensus, even among those who support a higher minimum wage, is that 50% is as high as it is reasonable to go) but that’s what he’s decided to do. And we can generally predict what the effects will be. There will be a rise in unemployment compared to what would have happened without that rise, there will be price rises negating much of the effect of higher incomes and employers will also respond by trying to cut whatever parts of the non-wage employment bill they can.
- China Goes Prospecting for World’s Gold Mines
Chinese gold miners are aggressively scouting for overseas acquisitions, encouraged by historically low gold prices that could help them scoop up assets cheaply. Though gold prices have risen more than 16% since hitting a six-year low in December, the metal has still been trading close to levels last seen in 2010, in a range of roughly $1,220 to $1,240 a troy ounce. China is the world’s largest gold consumer and producer, but only a few Chinese companies, such as Zijin Mining Group Co., have ventured abroad to buy mines, unlike their counterparts in industrial metals.
- Trans-Atlantic & Trans-Pacific “Partnerships” Complete Corporate World Takeover — Paul Craig Roberts
As I have emphasized since these “partnerships” were first announced, their purpose is to give corporations immunity from the laws in the countries in which they do business. The principle mechanism of this immunity is the granting of the right to corporations to sue governments and agencies of governments that have laws or regulations that impinge on corporate profits. For example, France’s prohibitions of GMO foods are, under the “partnerships,” “restraints on trade that impinge on corporate profits. The “partnerships” set up “tribunals” staffed by corporations that are outside the court systems of the sovereign governments. It is in these corporate tribunals that the lawsuits take place. In other words the corporations are judge, jury, and prosecutor. They can’t lose. The “partnerships” set up secret unaccountable governments that are higher and have power over the elected governments.
- Over 11,000 Coal Miners Lost Their Jobs In The Last Year
Coal mines shed more than 11,000 jobs in the last year, according to recently released employment data, as the industry continues to contract under onerous federal regulations and faltering demand. Bureau of Labor Statistics reports there were around 56,700 coal miners employed across the U.S. as of March 2016, which is down about 11,200 jobs from March 2015 when some 67,900 coal miners had jobs.
- Comparing the 1930s and Today
You’ve heard the axiom “History repeats itself.” It does, but never in exactly the same way. To apply the lessons of the past, we must understand the differences of the present. During the American Revolution, the British came prepared to fight a successful war—but against a European army. Their formations, which gave them devastating firepower, and their red coats, which emphasized their numbers, proved the exact opposite of the tactics needed to fight a guerrilla war. Before World War I, generals still saw the cavalry as the flower of their armies. Of course, the horse soldiers proved worse than useless in the trenches. Before World War II, in anticipation of a German attack, the French built the “impenetrable” Maginot Line. History repeated itself and the attack came, but not in the way they expected. Their preparations were useless because the Germans didn’t attempt to penetrate it; they simply went around it, and France was defeated.
- LIST: Who are the World’s Top 10 Oil Producers?
Countries are producing oil at record levels in an attempt to maintain or grow their market share. Here is a list of the world’s top 10 oil producers. Source: US Energy Information Administration; Data includes crude oil, lease condensate, natural gas plant liquids, and refinery processing gain.
- Dead Canaries And Disobedient Falcons: Bad Month Coming, Especially For Banks
Corporate profitability is one of the canaries in today’s financial coal mine. If companies are making more money each year they tend to hire more people, pay more taxes and generally make life easier for everyone else. But when earnings decline, everything from government budgeting to personal financial planning gets much harder. Viewed through this lens, 2015 was a “coming to grips” year in which the financial markets vacillated over the meaning of falling corporate profits: Are they an aberration or the new normal?
- Skunk At A Garden Party—-Kuroda’s Money Printing Failure In Japan Is Bringing Bad News To The G-20
The world’s central bankers, already hitting limits of their effectiveness on growth and inflation, are now contending with another risk: that additional stimulus could produce lackluster results and undercut investor confidence. The Bank of Japan’s decision in January to take interest rates negative has sent bond yields tumbling, while doing little to curb a surging yen that’s squeezing the world’s third-biggest economy just when it needs a weaker currency. That’s put even more monetary and fiscal stimulus on the agenda at a time when Japanese households and companies are increasingly doubting the program. “Japan is bringing bad news to the world,” said Hiromichi Shirakawa, chief Japan economist at Credit Suisse Group AG and a former BOJ official. “It’s demonstrating that massive monetary easing doesn’t work for everyone. Any additional stimulus may invite criticism from other central banks.” The decline in credibility in Japan is a warning sign for central bankers and finance ministers who gather this week in Washington for spring meetings of the International Monetary Fund and World Bank, as well as a Group of 20 session.
- Warren Buffett’s right-hand man gave a dark warning about American finance
Warren Buffett’s right-hand man, Charlie Munger, is worried about American finance. According to the Berkshire Hathaway vice chairman, we have “a vast gambling culture, and people have made it respectable.” Basically, the stock market is a casino, and too many people want to get rich quickly. He said: There’s way, way too much of that in America. And too much of the new wealth has gone to people who either own a casino or are playing in a casino. And I don’t think the exaltation of that group has been good for life generally, and I am to some extent a member of that group.
- Why You Should Own Gold Before the Government Starts Handing Out Free Cash
Ivy League economists agree… The economy is struggling because central banks haven’t printed enough money. If you’ve been reading the Dispatch, you know this statement is absurd. After all, central banks have printed trillions of currency units since the 2008 financial crisis. The U.S. Federal Reserve has printed $3.5 trillion by itself. On top of that, many world central banks have dropped interest rates to zero, making it extremely cheap and easy to borrow money. According to mainstream economists, these easy-money policies were supposed to jumpstart the global economy. But this plan has been a miserable failure. The U.S., Europe, and Japan are all growing at the slowest pace since World War II. China, the second-biggest economy after the U.S., is growing at its slowest pace since 1990.
- ‘In five years the vast majority of the cash will be out of the system’
Mark Barnett, the boss of MasterCard in the UK and Ireland, believes that in five years time cash will be practically extinct in Britain and Ireland — and in 30 years it will seem as old fashioned as the horse and cart. Barnett told Business Insider at the Money2020 conference in Copenhagen last week: “By the time we get to another generation, 30 years down the track, will there be any cash? I very much doubt it. The idea of carrying coins — 2p, 1p, 50p all cluttering up your pocket — it will be an anachronism. It will seem as antediluvian as carrying a pouch full of gold.”
- Pastor Lindsey Williams – The Energy Non-Crisis…
Pastor Lindsey Williams – The Energy Non-Crisis… Learn what happened when Chaplain Williams met the Elite of the world… Watch the FULL Presentation NOW! – FREE!
- Quietly the advantage in gold goes to private investors
I can remember only one other time when market factors lined up as favorably for gold as they do now and that was in the spring of 2008. There are a great many similarities to gold market dynamics between now and then, but there are also great differences. One of those differences is the huge influx of interest from institutional investors led by hedge funds and big banks. In 2008, institutional interest was light. Now HSBC, JP Morgan Chase, Bank of America Merrill Lynch, ABN Amro, UBS and Deutsche Bank, PIMCO and Black Rock head a growing list of investment houses that view gold favorably. In what could turn out to be the first among many such announcements, Munich Re, the giant German reinsurer, said it was adding gold to its reserves in the face of negative interest rates. Chief Executive Nikolaus von Bomhard told a news conference, “We are just trying it out, but you can see how serious the situation is.”
- Gold – The Best Defense Strategy
The War on Cash is on! If you are used to making visits to your bank to make your credit card payments, you may find this no longer an option in the future. Some banks are no longer accepting (or limiting their acceptance) of cash deposits. The war on cash forges on. Paper money, which is indeed more or less worthless, is slowly being taken out of circulation and being replaced by digital currency.
- Cash Banned, Freedom Gone
Some politicians want to ban cash, arguing that cash is helping criminals. The first steps in that direction are the withdrawal of big denomination notes and the limits imposed on cash payments. Proponents of a ban on cash claim that this will help fight criminal transactions — involved in money laundering, terrorism, and tax evasion. These promises of salvation are used to get the general public to agree to a society without cash. But there is no convincing proof for the claim that the world without cash will be a better one. Even if undesirable behavior is indeed financed by cash, you still need to answer the question: will the undesirable behavior disappear without cash? Or will those who commit the undesirable acts take to new ways and means to reach their goal?
- Economist Warns: “A Tidal Wave Is Coming… Recession Indicator Has Turned Red”
With corporate earnings for the first quarter of 2016 set to be the worst since the Great Recession, Societe Generale economist Albert Edwards is warning that the United States is about to be hit with a tidal wave. A tidal wave is coming to the US economy, according to Albert Edwards, and when it crashes it’s going to throw the economy into recession. …the profit recession facing American corporations is going to lead to a collapse in corporate credit. “Despite risk assets enjoying a few weeks in the sun our fail-safe recession indicator has stopped flashing amber and turned to red” … He continued: Whole economy profits never normally fall this deeply without a recession unfolding. And with the US corporate sector up to its eyes in debt, the one asset class to be avoided — even more so than the ridiculously overvalued equity market — is US corporate debt. The economy will surely be swept away by a tidal wave of corporate default.
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Latest News From April 8, 2016 to April 14, 2016:
- Hathaway Is Right, The Price Of Gold Will Skyrocket…To $10,000 – $20,000
Eric King: “Stephen, I know you’ve had a chance to look at the KWN interview with John Hathaway — your thoughts on what John had to say.” Stephen Leeb: “John is absolutely right. Eric, I don’t think people really appreciate how little gold there is in the world. If you add it all up, the value of all of the physical gold in the world is something like $7 trillion….
- Greece sells country’s largest port to China
China has described a deal to sell Greece’s biggest port to Chinese shipping group COSCO as a “win-win” for both countries. Under the deal between Greece’s privatization fund HRADF and China COSCO Shipping Corporation, the Chinese investors will pay 280.5 million euros($319.79 million) to HRADF for the initial acquisition of a 51 per cent stake, while it will pay another 88 million euros within five years for the remaining 16 per cent, provided it has implemented the agreed investments in the port.
- Legend Art Cashin Warns This May Shock Investors Across The Globe And Create Panic
Legend Art Cashin warns this may shock investors and create panic. Eric King: “Art, you put out a note yesterday stating that we needed to take a look at the velocity of money. What is that looking like at this point? Any changes? Art Cashin: “Yes, M2 has moved up. But perversely and in a countervailing sense, the Bank of St. Louis released the monetary base. The monetary base is what the Fed can do directly. If you can grow the monetary base, then ordinarily it would indicate that you can get monetary velocity and some inflation.
- World Gold Council First Quarter Report a Bunch of Bull
The World Gold Council’s first quarter report is a bunch of bull. Or perhaps it would be more accurate to say it projects a very bullish outlook for gold. The report confirms what we already knew – gold got off to a glittering start in 2016 – and it predicts the rally will likely continue and evolve into a genuine, long-term bull market.
- Gold Surges As Peter Boockvar Issues An Ominous Warning
On the heels of gold trading $20 higher and silver surging 60 cents, today Peter Boockvar issued an ominous warning. Peter Boockvar: Following the rally from Friday, European bank stocks are up for a 2nd day as more details emerge about a possible private sector involved TARP like program for Italian banks. Officials from the Italian Treasury Department and central bank will be meeting with top bank executives possibly this week. The Euro STOXX bank index is up by 2.3% as of this writing after Friday’s 3% rally with Italian banks again leading the gains. Italian banks have been suffocated by an excess of bad loans and the Renzi government is finally doing something about it…
- How The Oil Crisis Has Impacted Military Spending
A report by the Stockholm International Peace Research Institute has revealed that most of the world’s nations hiked their military budgets last year, marking the first increase in spending since the 2008 crisis. It seems that the only ones not taking part in this military spending hike are some of the world’s biggest oil producers. While the United States is still the country with the largest military budget at $596 billion spent in 2015, this figure was actually a decline on the previous year. Saudi Arabia, according to Bloomberg, would also have cut its military budget if not for the war in Yemen. Russia, the world’s top oil producer, shrank military outlays in 2015 to $66.4 billion.
- How a US President and JP Morgan Made Panama: And Turned it Into a Tax Haven
This goes back a long way. The Panamanian state was originally created to function on behalf of the rich and self-seeking of this world – or rather their antecedents in America – when the 20th century was barely born. Panama was created by the United States for purely selfish commercial reasons, right on that historical hinge between the imminent demise of Britain as the great global empire, and the rise of the new American imperium.
- Something Just Snapped In Saudi Money Markets
Away from the headlines about The Panama Papers, global financial markets turmoiled quietly this week with a surge in equity and FX volatility and banks suffering more death blows. However, something happened in Saudi Arabia’s banking system that was largely uncovered by anyone in the mainstream… overnight deposit rates exploded to their highest since the financial crisis in 2009…
- ALERT: Legend Warns That People Must Now Prepare For A Massive Global Collapse
Egon von Greyerz: “The bank stocks are now warning investors that it is time to get money and assets out of the banking system. As you know Eric, we warned investors long before the 2006 – 2009 crisis to get out of the banking system. At that time banks were saved by a $25 trillion global package but that won’t happen again. Credit worldwide has increased by 70% since 2006 and the banking system as well as the world economy are now in a massively worse condition than they were at that time…
- Pierre Lassond On the End of the Bear & $8000 Dollar Gold
Franco-Nevada’s Pierre Lassond is “very sure” gold’s 5 year bear market is over and we’re at the start of a new bull market. Just how high could gold go during this new bull market?
- Will the Bank of Japan force a lower yen?
Both the European Central Bank and the Bank of Japan appear to be making little headway in bringing their respective currencies down against the dollar, and lifting inflation rates which in some cases have faltered into negative territory. And so it was on Friday that the yen’s highest level in two years delivered another blow to the Japanese government’s efforts to swing the economy around since it plummeted in the wake of the Fukushima nuclear disaster five years ago.
- Watch Japan – For All Is Not Well In The Land Of The Rising Sun
One of the epicenters of the global financial crisis that started during the second half of last year is Japan, and it looks like the markets in the land of the rising sun are entering yet another period of great turmoil. The Nikkei was down another 390 points last night, and it is now down more than 1,300 points since a week ago. Why this is so important for U.S. investors is because the Nikkei is often an early warning indicator of where the rest of the global markets are heading. For example, the Nikkei started crashing early last December about a month before U.S. markets started crashing really hard in early January. So the fact that the Nikkei has been falling very rapidly in recent days should be a huge red flag for investors in this country.
- CEO Keith Neumeyer: “There’s Going To Be A Major Revolt If We See Negative Rates”
CEO Keith Neumeyer Warns: “There’s Going To Be a Major Revolt… We’re Going To See Riots” With negative interest rates now the order of the day in much of the Western world, it’s only a matter of time before financial institutions start charging American depositors for the privilege of keeping their money safe in the U.S. banking system.
- Why Are Thousands Of Millionaires Fleeing Chicago And Other Major Cities Around The World?
The elite are fleeing major cities around the globe at a staggering rate. In fact, the Chicago Tribune is reporting that approximately 3,000 millionaires left the city of Chicago alone during 2015. The same study discussed in that Chicago Tribune article found that 7,000 millionaires left Paris, France last year. So why is this happening? Why are thousands of millionaires suddenly packing up and moving away from the big cities? Could it be possible that they have many of the same concerns that “preppers” do about what is coming?
- Economic Collapse Is Erupting All Over The Planet As Global Leaders Begin To Panic
Mainstream news outlets are already starting to use the phrase “economic collapse” to describe what is going on in some areas of our world right now. For many Americans this may seem a bit strange, but the truth is that the worldwide economic slowdown that began during the second half of last year is starting to get a lot worse. In this article, we are going to examine evidence of this from South America, Europe, Asia and North America. Once we are done, it should be obvious that there is absolutely no reason to be optimistic about the direction of the global economy right now. The warnings of so many prominent experts are now becoming a reality, and what we have witnessed so far are just the early chapters of a crushing economic crisis that will affect every man, woman and child in the entire world.
- Deutsche Bank Says World “Past The Point Of No Return” In The Default Cycle
Over the past year, the credit cycle finally turned, and has unleashed the latest default cycle. In fact, as BofA’s Michael Contopoulos warned last week, it may be the worst default cycle in history with “cumulative losses over the length of the entire cycle could be worse than we’ve ever seen before.” Over the weekend, the FT got the memo with a report that “global company bond defaults at highest level since 2009” in which it said that “the global bond default rate by companies is running at its highest since 2009 with the US accounting for the vast majority, according to rating agency Standard & Poor’s. A further four defaults this week, with three coming from the troubled oil and gas sector, pushed the overall tally to 40 with a little over a quarter of 2016 done.”
- Biggest Collapse Ever-Get Gold Now-James Rickards
Financial expert and best-selling author James Rickards says another economic collapse is coming. Rickards contends, “It’s very clear, and you can prove this scientifically. The next collapse will be bigger than anything in history or maybe since the Bronze Age or the fall of the Roman Empire. Why do I say that? . . . We have these things coming together. The system is larger. That means systemically it is exponentially more risky. The central banks don’t have any dry powder, and it is just a matter of time before the collapse comes. In 1987, the stock market fell 22% in one day, not in a week or a month, but one day. Today, that would be the equivalent of a 4,000 point drop. . . . In 1998, the Long Term Capital crisis shut almost every stock and bond exchange in the world. In 2000, the Dot Com; 2007, the mortgage crisis; and in 2008, you had Lehman and AIG (failures). In other words, these events are not rare, and they happen every three, four or five, six or eight years. It’s not like clockwork, but nobody should be surprised if it happened tomorrow. We’ve got the systemic scale. We’ve got exponential increase in risk. The central banks are out of dry powder, and it’s been eight years since the last one. It’s just a matter of time.”
- Next Shoe to Drop on Spanish Banks – “The mortgage ‘floor clauses’ are a fraud.”
Thursday, April 7, 2016, could go down in history as a great day for Spanish mortgage holders and a very grim one for many Spanish banks, thanks to a new ruling that the so-called mortgage floor-clauses that were unleashed across the whole financial sector in 2009 are abusive (but not illegal) and lack transparency. These floor clauses set a minimum interest rate — typically of between 3% and 4.5% — for variable-rate mortgages, even if the Euribor drops far below that figure. In other words, the mortgages are only really variable in one direction: upwards!
- BlackRock CEO Fink: Negative & Low Interest Rates Eat into Consumer Spending at Worst Possible Time
“A hostile landscape” – that’s what BlackRock CEO Larry Fink called the global investment, economic, and political environment in his gloomy annual letter to his shareholders. It starts out propitiously: Investors today are facing tremendous uncertainty fueled by slowing economic growth, technological disruption, and social and geopolitical instability. More specifically: In China, growth is slowing with global effects. In the U.S., the quality of corporate earnings is deteriorating, with record share repurchases in 2015 driving valuations – an indication of companies succumbing to the pressures of short-termism in place of constructive, long-term strategies.
- Supply Chain Slump “Worse Than The Great Recession”
Not to continue beating a dead horse, but I have a stick and the carcass is right in front of me. The entire supply chain inside the US economy is full agreement both on where the economy is right now and, perhaps more importantly, how it came to be that way. Such harmony is not atypical, as synchronicity usually defines the hard edges of any cycle. This, however, is something else entirely, especially as it stretches back years and confirms we are witnessing nothing like the usual.
- Iran War Drums, Panama Papers Update, Economy Weak and Sick
Lots of news about Iran this week being overlooked because of the so-called Panama Papers. Iran has issued a warning to the U.S. not to interfere with its ballistic missile program. Iranian officials say any attempt to interfere with its weapons program would be crossing a “red line.” Iran also wants to improve the destructive power of its warheads which would also help in detonating a nuclear armed missile. Iran has recently test fired ballistic weapons and continues to develop them. An Iranian General was quoted this week on Iranian state run press, as saying “The reason we designed our missiles with a range of 2000 km is to be able to hit our enemy the Zionist regime from a safe distance.” The Obama Administration is now talking about putting sanctions on Iran because it continues to develop ballistic missiles. Might I remind you, the Iran deal to curtail its nuclear program was not signed by Iran. By the way, the U.S. Navy just intercepted a load of weapons going to the Iranian backed rebels in Yemen.
- Crash of Biblical Proportions Coming in 2016-Bo Polny
Market cycle analyst Bo Polny says don’t bet on the U.S. dollar or the stock market to hold their value in 2016. Polny contends, “The dollar is going down with the stock market. It did in December of 2015. It did in August of 2015, and the dollar is falling right now again. As soon as the stock market gets started to the downside, the dollar is going to go with it again. So, the dollar is going to go down with the stock market with this next meltdown. What’s going to end up happening when they hit the cycle low is what they did the last low (2009) and had QE 3. Guess what, that’s going to mean (in the next crash) QE 4. Then, that will mean they will be printing money like crazy. Let’s say there is a 20% drop on the dollar, even 10%. Everybody goes to sell the bonds. If the 10-year is only giving 1.7% yield, if the dollar drops 10%, they are losing 8%. If the dollar drops 20%, they are losing 18%. So, all these countries will be losing on billions or trillions of dollars of bonds, and then you will get a fire sale on bonds. Everyone will be dumping the bonds because they will be trying to get rid of them as fast as possible. That is what’s going to happen when they announce QE 4.”
- China “Could Push Whole World into Fresh Economic Crisis”
After years of big wage increases in China, the supply of cheap labor is coming to an end. The migration of rural populations to cities, which in practically no time created over 250 cities with over 2 million inhabitants, is also coming to an end. As the cost of labor has soared, the manufacturing base is now migrating to cheap-labor countries like Vietnam, leaving less work in Chinese cities for migrant laborers. With few options left, they’ve started to return to their villages. This leaves China with massive challenges, just when its debt-burdened economy can least afford them.
- Bank Bail Ins Begin as EU Bank “Bailed In” In Austria
Bank bail ins in the EU are here after Austria’s financial markets regulator FMA imposed a hefty haircut on creditors in an Austrian bank. Creditors in the bank Heta Asset Resolution will receive less than half of their money back according to the country’s financial regulator, the FMA. Senior bondholders in the so called “bad bank” could expect to receive around €0.46 for each euro which would be paid from the realisation of assets by 2020, according to the FMA statement. It said that this had been calculated using “very conservative” assumptions. “This package of measures also ensures the equal treatment of creditors. Orderly resolution is more advantageous than insolvency proceedings,” the FMA said.
- Silver Surges Most In 6 Months As Hedgers Cover
The last 3 days have seen silver prices surge over 6%, testing back towards the psychologically important $16 level. Having been pressured lower after the ECB bounce, the precious metal jumped perfectly off its critical 200-day moving-average, nearing the highs of the year once again.
- Chesapeake Forced To Pledge Entire Company As Collateral To Preserve Existing Credit Facility
As we enter the critical spring borrowing base redetermination season, which as we previewed previously is the biggest threat to near-insolvent energy companies whose banks may, and in many cases will, decide their assets are worth far less and as a result dramtically cut their revolver availability, one of the biggest question marks was how generous would the banks of troubled gas giant Chesapeake be, whose $4 billion credit facility is one of the few things keeping the company still afloat. We got the answer earlier today when the company announced it had succeeded in maintaining its entire $4 billion borrowing base and as a result would not suffer an imminent liquidity crunch.
- Helicopter Money “Not on the Table,” ECB Swears Furiously
It has finally sunk in: what everyone really wants is helicopter money. Central banks, instead of transferring trillions of newly created dollars or euros or whatever to the banks should just hand them directly to the people, like dropping bank notes from a helicopter, so that these people can grab them and spend them all in one fell swoop, thereby creating sudden artificial demand, driving up inflation, and solving all economic problems of our times. Instead of creating asset price inflation, as QE had done, it would create consumer price inflation. Wages would still remain stuck, and workers would soon not be able to buy the normal things at these inflated prices, but that wouldn’t matter because now they’re getting helicopter money, and companies could increase their sales, margins, and profits simply by raising prices without having to sell a single extra item.
- Ben Bernanke: “Helicopter Money May Be The Best Available Alternative”
Now that the prospect of helicopter money by the ECB has so infuriated Germany, the ECB had to reach out to Schauble to “mollify” the Germans who are dreading the second coming of monetary paradrops in one century, it was only a matter of time before Citadel’s most prominent employer opined. In a blog post earlier today, Brookings’ blogger and the central banker who together with Alan Greenspan has been most responsible for the world’s unprecedented debt pile and sad economic state, Ben Bernanke, took the podium to share his views on “helicopter money” head on.
- Analysis: The mechanics of leaving the European Union
Ignoring shouted questions about whether he will resign, he reprises his reaction to his shock Commons defeat over Syria in 2013. “The will of the British people is clear,” he says, “I get it and I will negotiate accordingly to implement their clear decision.” Suppose that, or something like that, happens. What next, for the government and for Parliament? How would MPs deliver the decision the British people had just voted for? The first point to make is that the process cannot easily be separated from the political mayhem that would then unfold.
- Russia Relies on Gold to Push Reserves Back Over $380 Billion
Whether you define gold as a barbarous relic, a pet rock, “tradition”, or “doomed”, Russia surely refers to it as a saving grace. As Russia’s foreign reserves dwindled to just under $350 billion in early 2015, many predicted Russia was going to burn through all of their reserves in the not too distant future as they dealt with a depreciating Ruble and plummeting oil revenues. However, this dire prediction did not pan out mainly due to one thing: Russia’s strategic decision to load up on as much gold over the past few years as it possibly could. As we have shown in the past, Russia has shown an insatiable desire for Gold, and as Bloomberg points out, has increased their holdings more than 12% since last July.
- Will The Oil Price Dip Send BP plc and Royal Dutch Shell Plc Back Into Reverse?
Oil is up 44% since Brent crude hit a low of $27 a barrel in January, to reach $38.93 at time of writing. FTSE 100-listed oil giant Royal Dutch Shell(LSE: RDSB) has rallied with it, its share price up 33% since mid-January, from a low of 1277p to today’s 1709p. BP(LSE: BP) is a more troubled beast and its share price growth has been less spectacular, rising just 5.5% from its January low of 328p to 346p today.
- European Bank Outlook More Uncertain Than in 2009, Perol Says
Groupe BPCE Chairman Francois Perol said the outlook for the European banking industry is more uncertain in some respects than in 2009 as negative interest rates squeeze margins and digitalization changes the model. “Chinese growth is decreasing, oil prices are down with unexpected consequences, geopolitical risk is in a lot of areas,” Perol told reporters Saturday on the sidelines of the Ambrosetti Workshop in Cernobbio, Italy. Banks also have to deal with structural changes including “digitalization, a huge change for our retail banking business, negative interest rates and a changing regulatory landscape,” he said.
- World Bank goes big on fighting climate change
The World Bank has announced plans to fight climate change through a new Climate Change Action Plan that it hopes will see investment in environmental projects reach $29 billion a year by 2020. In a statement on Thursday, the Bank said that, in the next five years, it planned to help countries in the developing world add 30 gigawatts of renewable energy to global energy capacity; provide “early warning systems” to 100 million people; and develop “climate-smart agriculture investment plans for at least 40 countries.” The news comes in the wake of the historic COP21 agreement reached in Paris at the end of 2015. There, 195 countries agreed to make sure global warming stayed “well below” 2 degrees Celsius and to “pursue efforts” to limit the temperature rise to 1.5 degrees Celsius. The Bank said its announcement came a fortnight before the world’s leaders meet in New York to sign the Paris Agreement.
- UK Goods Trade Gap With EU At Widest Level
The UK’s trade in goods deficit with the European Union is at its widest ever level, with a series of other indicators providing further evidence of troubles for the economy. The Office for National Statistics (ONS) reported a gap of £23.8bn between imports and exports with the EU in the three months to February. It reflected, the ONS said, a 1.3% decrease in exports and a 1.1% rise in imports during the period – a time when fierce debate began over the country’s continued membership of the EU ahead of June’s referendum. The economic slowdown in many world markets was also reflected in the country’s total deficit in goods and services, which widened to its largest three-monthly figure since March 2008.
- Peter Schiff: The Economy Is A Disaster
Peter Schiff was on Tuesday’s edition of PreMarket Prep, where he reiterated his bearish thesis for the market in the wake of the Federal Reserve’s decision not to raise interest rates last week. Schiff wasn’t convinced by the positive market talk coming out of the Fed. “I knew that it was all talk, and when Janet Yellen actually spoke she validated what I said,” Schiff said. “She basically came out and said ‘We’re not raising rates and it’s not because we think the economy is weak, it’s because we decided that lower interest rates are appropriate.’ Which is all B.S, because it’s all about the economy. The economy is a disaster. I think Yellen probably realizes we’re in a recession.”
- Vermont Residents Leave State As It Becomes Riddled With High Taxes
Democratic presidential candidate Sen. Bernie Sanders isn’t coy about his intention to spend like crazy and raise everyone’s taxes if he’s elected president. Forgetting the fact that his health care plan is a disaster for the working poor, these sentiments of taxation to solve every societal ill appears to be the governing ethos in Vermont, where the state legislature just passed millions more in tax increases.
- Silver Jewelry Sales Strong, Reflecting Broader Demand for the White Metal
The market for silver jewelry grew in 2015, mirroring an overall surge in demand for the white metal, according to a survey report released yesterday by the Silver Institute: “Silver jewelry sales in the United States were solid in 2015 with 60% of jewelry retailers reporting increased sales, according to a survey conducted on behalf of the Silver Institute’s Silver Promotion Service (SPS). This marked the seventh consecutive year of growth for silver jewelry sales and confirmed that silver jewelry is an increasingly important category for many retailers.”
- Schiff: Obama’s tax inversion rules will backfire
Economist, author and financial analyst Peter Schiff told CNBC’s Rick Santelli the new tax inversion rules from the Obama administration, which ended the Allergan-Pfizer deal, could backfire. “By the government making it harder for American companies to buy foreign companies and invert, they are going to leave American companies vulnerable to being acquired by foreign companies instead,” Schiff said in a Santelli Extra interview exclusive to CNBC Pro subscribers. “And when that happens, the domestic job losses are going to be much bigger.” Apart from tax regulation, Schiff also discusses his views on inflation, gold, the Fed and Donald Trump.
- Fed minutes: Debated rate hike in April, but several concerned
Federal Reserve policymakers debated last month whether an interest rate hike would be needed in April though a consensus emerged that risks from a global economic slowdown warranted a cautious approach. “Many participants expressed a view that the global economic and financial situation still posed appreciable downside risks,” according to the minutes from the Fed’s March 15-16 policy meeting released on Wednesday.
- California’s $15 Minimum Wage Is Going To Be Painful
Of course, part of the basic intention of the rise in the minimum wage to $15 an hour in California is that it should be painful. Those plutocrats should be forced to disgorge all that they’ve made by exploiting the working man all these years and such pain is just wonderful. However, that’s not quite what’s going to happen as two interesting little studies show. The truth is that California is a very large and very diverse economy and there’s no evidence at all which shows that $15 an hour is the right price for labor right across it. (Of course, I argue that there shouldn’t be a minimum wage in the first place but that’s a slightly different matter.) Whatever your arguments in favor of a rise in the minimum wage there’s no way to make that one rate right for all of California.
- Central Banks are Pushing Monetary Heroin to Addicted Economies
We hear a lot about the role of central banks in the world’s economies. But what exactly have they been doing over the last few years, and what has the actual impact been? Central banks have the authority over the interest rates and the quantity of a nation’s currency. Their official responsibility is to regulate price stability. By law some central banks, such as the Federal Reserve, operate under a dual mandate and must also promote full employment. Central banks hold the reserve assets that support the integrity of their issued currency.
- Venezuela to cut power use with holidays
Venezuela’s President Nicolas Maduro has decreed that all Fridays for the next two months will be holidays, in a bid to save energy in the blackout-hit Opec country. “We’ll have long weekends,” Mr Maduro said in an hours-long appearance on state television on Wednesday night, announcing the measure as part of a 60-day plan to fight a power crunch. A severe drought, coupled with what critics say is a lack of investment and maintenance in energy infrastructure, has hit the South American nation, which depends on hydropower for 60% of its electricity.
- Trump Unbound
Even by The Donald’s standards his 95 minute long interview with the Washington Post was remarkable. He let loose so many stray shots as to leave the establishment press clucking in a chorus of disbelief. It undoubtedly started with the stink bomb he lobbied at the ” all is awesome” meme about the US economy and stock market.
- The Number of People Behind on Student Loan Payments Is Staggering
Student loan debt can haunt borrowers for decades. An increasing number of student loan borrowers are behind on their payments, creating concern that millions of Americans may never pay off their debts. About 43% of the 22 million Americans with federal student loans weren’t making payments as of Jan. 1, the Wall Street Journal reported. That’s actually a slight improvement from the same time last year, when the non-payment rate was 46%, the Department of Education found.
- Wholesale Inventories Drop Most Since 2013; Sales Miss As Slowdown Accelerates
There was one thing keeping US GDP growing in recent months: rising inventory. Well, no more. Moments ago the Dept of Commerce reported the latest inventory data and following major historical revisions, not only was last month’s inventory print slashes from 0.3% to -0.2%, but the February Inventory number was a dramatic -0.5% drop, far below the -0.2% expected. This was the biggest sequential drop since the spring of 2013.
- Wholesale Inventory Plunge Is Bad Sign For U.S. GDP Growth
Wholesale inventories tumbled at their fastest rate in nearly three years, data showed, signaling first-quarter U.S. economic growth was even weaker than expected. Wholesale stockpiles fell 0.5%, the Commerce Department said Friday, the biggest drop since May 2013. Analysts had expected a 0.2% decline. Meanwhile, January was revised from a small gain to a 0.2% decline. Wholesale inventories have now fallen for five straight months as companies try to whittle down high stockpile levels. But wholesale sales have dropped for the last four months, down 0.2% in February after January’s 1.9% tumble.
- Cash Limits Are All About Control Over You, But You Can Take Back the Power
JP Morgan Chase Bank just fired another salvo in the “war on cash.” The bank recently capped ATM withdraws for non-Chase customers at $1,000 per day. The move came after the bank began installing new ATMs that dispense $100 bills. Some people were reportedly pulling tens of thousands of dollars out at one time, according to a report in the Wall Street Journal. A spokeswoman said the bank “felt it was prudent to set withdrawal limits on all of our ATMs.”
- The Atlanta GDP Now estimate falls to 0.1% from +0.4%
The Atlanta Fed updated their GDP estimate for the 1st quarter earlier today, and once again it is to the downside. The new GDP growth estimate is 0.1% vs. 0.4% last reported on April 5. The decline was attributed to the wholesale trade report from the US Bureau of Census. The forecast for the contribution of inventory investment to the 1st quarter to real GDP fell from -0.4% to -0.7%.
- Puerto Rico Senate Passes Sweeping Moratorium on Paying Debt
Puerto Rico’s Senate approved a bill calling for a moratorium on a wide range of debt payments, including general-obligation bonds, through January 2017 in the latest escalation of the Caribbean island’s fiscal crisis. The measure, passed around 2:30 a.m. local time, would allow Governor Alejandro Garcia Padilla to suspend payments on debt backed by the government, the island’s Government Development Bank and other public agencies, according to a copy of the legislation obtained by Bloomberg. That includes the Sales Tax Financing Corp., known by its Spanish acronym Cofina. A default on those obligations would be a first for Puerto Rico, which so far has only failed to pay on bonds backed by legislative appropriation and rum taxes.
- Special Report – Puerto Rico’s other crisis: impoverished pensions
When Puerto Rico attempted to shore up its chronically underfunded public-employee pensions in 2013, Francisco del Castillo “knew grown men and women who wept.” Under the reform package, retirement ages rose. So did employee contributions. Current and future participants were transferred to less-generous defined-contribution accounts, similar to 401(k) retirement savings plans. Del Castillo, then the deputy chief of the island’s largest government-employee pension system, said members of his own staff who were on the verge of retirement suddenly faced the prospect of working seven or eight more years for reduced benefits. The law extracted “a pound of political flesh” from those, like del Castillo, who helped craft it, he said. “We wanted it to work.”
- Puerto Rico’s Development Bank on Brink as Debt Gambit Goes Bad
Puerto Rico’s Government Development Bank, which was set up after the Great Depression to chart a course out of poverty, is on the verge of a collapse that would deepen the Caribbean island’s $70 billion debt crisis. The lender was designed to promote business investment with a long-term horizon, but in recent years politicians turned it into a piggy-bank that lent to the government and its agencies, helping keep them afloat as the island’s economy shrunk. Now it’s rapidly running out of cash and likely to default on a $422 million debt payment due in May — raising the risk that it may be pushed into receivership or broken up.
- Puerto Rico Investors Sue to Stop Development Bank Payments
Hedge funds holding debt in Puerto Rico’s Government Development Bank sued to stop the island’s key fiscal entity from making payments to local government agencies as it faces a growing cash shortage and the prospect of insolvency. The funds, which include affiliates of Brigade Capital Management, Claren Road Asset Management and Solus Alternative Asset Management, accused the bank in a lawsuit filed Monday in San Juan federal court of seeking to “prop up” local agencies at the expense of other creditors. The situation may imperil restructuring efforts for the bank, which its regulator says is facing a cash shortfall of as much as $1.3 billion in June. Puerto Rico, which is negotiating with creditors to reduce a $70 billion debt load, has “had every incentive to cannibalize” the bank to “meet its own liquidity needs through preferential transfers even if such transfers make it impossible to restructure” the bank, the hedge funds said in the complaint. “The unfortunate depositors and bondholders left behind in GDB will be left to bear amplified losses.”
- Kenya’s Chase Bank placed under receivership by CBK
A retail bank in Kenya has been placed under receivership after running into financial difficulties. Panic withdrawals on Wednesday, caused by “inaccurate” rumours on social media, led to a run on Chase Bank, said the Central Bank of Kenya (CBK). Its branches were shut on Thursday. The bank is the third to be placed under the CBK’s control in the past year. Chase had recently released two conflicting financial statements, a BBC reporter says. A subsequent audit showed it had hidden loans to its directors, adds the BBC’s Ferdinand Omondi in the capital, Nairobi. In a statement, the CBK said it would appoint a team to run the bank.
- Chase ATMs to Limit Withdrawals for Noncustomers to $1,000 a Day
J.P. Morgan Chase & Co. capped ATM withdrawals at $1,000 per card daily for noncustomers—cracking down as people started pulling out tens of thousands of dollars at a time when the bank was modifying its machines to dispense hundred-dollar bills with no limit. The bank said there doesn’t appear to be fraud involved. But partly due to heightened regulatory scrutiny, banks are paying more attention to large cash transfers that could be a sign of money laundering or other types of shady activity. Typically, the card-issuing bank sets withdrawal limits, not the bank owning the ATM.
- EU referendum: IMF’s Christine Lagarde warns of dangers of a ‘Brexit’
Christine Lagarde, International Monetary Fund Managing Director, has put June’s EU referendum among the threats to the global economy. A vote to leave the EU is “clearly part of the uncertainty we have at the moment” Lagarde said in an interview with Bloomberg Television in Frankfurt, noting the impact it may have on London’s financial sector. Her comments came on the same say day she has urged governments to pursue more growth-friendly policies in a speech at Frankfurt’s Goethe University, Germany. Lagarde warned that the recovery from the 2007-2009 global financial crisis “remains too slow, too fragile and risks to its durability is increasing”. She said that the global outlook has weakened further in the past six months, suggesting the IMD may be revising its growth outlook.
- Think the Market Will Reach a New High? Here’s Why We Don’t – Just look at the environment we’re in.
Stocks are once again rallying after another “mini crash” at the start of the year. We’ve had three of these things since October 2014 without much to show for it. Stocks have basically gone nowhere for a year and a half. After the first crash in late 2014, stocks were able to eke out a new high into May of last year. But since then, stocks have failed to make new highs despite strong attempts like this one. Ten months without a new high.
- Gas Pipeline Uses 160 Eminent Domain Suits To Get People’s Property In 3 States
Eminent domain is a tough pill to swallow for Americans who take their property rights very seriously, and the aggressive moves by Sabal Trail to seize property for a natural gas pipeline running through three southern states is turning into a drama of immense proportions. Sabal Trail, the joint venture planning to build a 500-mile natural gas pipeline through Georgia, Alabama, and Florida, has gone to court in order to secure the right of way through the land where the pipeline should pass. So far, Sabal Trail has filed 160 eminent domain suits and more are expected, according to a report by the Orlando Sentinel. The company is desperately trying to get the right of way through 346 more properties, though it says it has already secured the agreement of 1,248 landowners in the area along the route.
- Robert Kiyosaki And Harry Dent Warn That Financial Armageddon Is Imminent
Financial experts Robert Kiyosaki and Harry Dent are both warning that the next major economic crash is in our very near future. Dent is projecting that the Dow will fall to “5,500 to 6,000 by late 2017″, and Kiyosaki actually originally projected that a great crash was coming in 2016 all the way back in 2002. Of course we don’t exactly have to wait for things to get bad. The truth is that things are not really very good at the moment by any stretch of the imagination. Approximately one-third of all Americans don’t make enough money to even cover the basic necessities, 23 percent of adults in their prime working years are not employed, and corporate debt defaults have exploded to the highest level that we have seen since the last financial crisis. But if Kiyosaki and Dent are correct, economic conditions in this country will soon get much, much worse than this.
- PanamaPapers: India to probe hundreds for possible tax evasion
Even as many governments begin probing financial wrong-doing by those on the “Panama Papers” leak list, Indian Prime Minister Narendra Modi on Monday also ordered a multi-agency team to investigate the expose. 500 Indians, including top Indian film stars, business honchos and politicians, have been named in the list for alleged offshore holdings. According to an Indian Central Bank notification, those Indians setting up or buying foreign companies before 2013 are in ‘technical’ violation of Indian laws. Indian Prime Minister Modi has vowed to take action against all unlawful accounts held abroad.
- The EU Has Bigger Trouble than Brexit alone
The referendum in the Netherlands on April 6th is going to cause a lot of trouble, possibly axing the strong Dutch commitment to the European project. The plebiscite is about the Association Treaty between EU and Ukraine, into which the EU inserted some curious clauses about military cooperation and such. It is not a trading treaty per se, since those are the sole responsibility of the European Commission and would not require ratification by the member states. Another fact that points toward bigger issues at stake is the last-minute involvement of the US government that recently urged Dutch voters to vote YES.
- EL-ERIAN: Here are 10 things you should be closely watching in the global economy
Roller-coaster views about global growth were important contributors to the first quarter’s dramatic “V”-shaped stock market performance — from a scare early in the year that weakness in China and elsewhere could tip the US into recession to a more comforting assessment underpinned by friendly central banks and, in the case of the US, strong job creation. Disappointing growth is also the common element behind numerous improbable developments that have become reality, be they negative central-bank policy rates in Europe and Japan, almost one-third of government debt globally trading at negative yields, or the influence of antiestablishment political movements on both sides of the Atlantic.
- The Path to the Final Crisis
Our reader L from Mumbai has mailed us a number of questions about the negative interest rate regime and its possible consequences. Since these questions are probably of general interest, we have decided to reply to them in this post. Before we get to the questions, a few general remarks: negative interest rates could not exist in an unhampered free market. They are an entirely artificial result of central bank intervention. The so-called natural interest rate is actually a non-monetary phenomenon – it simply reflects time preferences. Time preferences are an inviolable category of human action and are always positive.
- China’s Gold Intent – ICBC Bank Reclassified as an LBMA Market Maker
ICBC Standard Bank, China and the world’s largest bank, has been reclassified as a spot Market Making Member of the London Bullion Market Association (LBMA) with effect from today according to a note posted on the LBMA website last night at 2100 GMT.
- ‘Everything Is Being Sold’ – Smart Money Selling Soars, Now In 10th Straight Week
“Still No Confidence In The Rally” – that’s the title of the latest weekly BofA report looking at the buying and selling by its smart money clients (institutional clients, private clients and hedge funds), which finds that not only were sales by this group of clients last week the largest since September, and the fifth-largest in our data history, but this was the 10th consecutive week of selling as absolutely nobody believed this fakest of fake “rebounds” in recent history.
- 19 Facts That Prove Things In America Are Worse Than They Were Six Months Ago
Has the U.S. economy gotten better over the past six months or has it gotten worse? In this article, you will find solid proof that the U.S. economy has continued to get worse over the past six months. Unfortunately, most people seem to think that since the stock market has rebounded significantly in recent weeks that everything must be okay, but of course that is not true at all. If you look at a chart of the Dow, a very ominous head and shoulders pattern is forming, and all of the economic fundamentals are screaming that big trouble is ahead. When Donald Trump told the Washington Post that we are heading for a “very massive recession“, he wasn’t just making stuff up. We are already seeing lots of things happen that never take place outside of a recession, and the U.S. economy has already been sliding downhill fairly rapidly over the past several months. With all that being said, the following are 19 facts that prove things in America are worse than they were six months ago…
Latest News From April 1, 2016 to April 7, 2016:
- U.S. Oil Rig Count Down by 10
The U.S. oil-rig count fell by 10 to 362 in the latest week, according to Baker Hughes Inc., maintaining a trend of declines. The number of U.S. oil-drilling rigs, viewed as a proxy for activity in the sector, has fallen sharply since oil prices began to fall. But it hasn’t fallen enough to relieve the global glut of crude. There are now about 72% fewer rigs of all kinds since a peak of 1,609 in October 2014.
- Automakers post disappointing U.S. sales, still see strong 2016
General Motors Co, Fiat Chrysler Automobiles and other major automakers reported weaker-than-expected U.S. sales for March, hurt by declining demand for sedans and light dealer traffic during the Easter weekend. Sales for the month rose 3 percent to nearly 1.6 million vehicles, or 16.57 million vehicles on an annualized basis, according to industry analyst Autodata Corp. That was well below expectations of a rise of about 7 percent and annualized estimates that ranged from 17 million to 17.5 million by analysts and economists polled by Thomson Reuters.
- Where The March Jobs Were: The Minimum Wage Deluge Continues
In March the US economy added a healthy 215K jobs, beating expectations and more importantly, pushing the average hourly earnings up by 0.3% on the month. Which, however, is curious because a cursory look at the job additions in the month reveals that nearly two-third of all jobs, and the three top categories of all job additions, were once again all minimum wages jobs.
- Gold Rush by Russia Makes Up for Billions Lost in Currency Rout
Here’s why Governor Elvira Nabiullina is in no haste to resume foreign-currency purchases after an eight-month pause: gold’s biggest quarterly surge since 1986 has all but erased losses the Bank of Russia suffered by mounting a rescue of the ruble more than a year ago. While the ruble’s 9 percent rally this year has raised the prospects that the central bank will start buying currency again, policy makers have instead used 13 months of gold purchases to take reserves over $380 billion for the first time since January 2015. The central bank will wait for the ruble to gain more than 12 percent to 60 against the dollar before it steps back into the foreign-exchange market, according to a Bloomberg survey of economists.
- Part-timers might account for labor-force surge
The number of able-bodied Americans entering the labor force has surged since last fall. But in a marked change from earlier in the recovery, more of them are finding jobs right away instead of just looking for work. What’s going on? It’s hard to say for sure, but circumstantial evidence in the latest U.S. jobs report suggests many of these newly employed workers have found part-time work with mediocre pay. The participation rate hit a two-year high of 63% in March, climbing from a 38-year low of 62.4% in September, the government said Friday. A person is considered part of the labor force if he finds or job or is actively searching for one.
- Meet the angry American voter
The angry primary voter is the election year manifestation of a 25-year trend gnawing away at American self-confidence. Call it one America, two economies. The S&P 500 is up more than 200% over the past seven years. Home prices rose 11% last year, and a quarter of housing markets are showing record high home prices. Millions of jobs have been added and the unemployment rate is 4.9%, approaching a level many economists consider full employment.
- Negative Yields, Opportunity Cost and Gold
Last week, I published an article on the causes and consequences of negative interest rates. In it, I talked briefly about how negative yields hold significant implications for gold as an asset class. In this followup article, I will explain why that is.
- U.S. factory data signal further slowdown in GDP growth
New orders for U.S. factory goods fell in February and business spending on capital goods was much weaker than initially thought, the latest indications that economic growth slowed further in the first quarter. The Commerce Department said on Monday new orders for manufactured goods declined 1.7 per cent as demand fell broadly, reversing January’s downwardly revised 1.2 per cent increase. Orders have declined in 14 of the last 19 months. They were previously reported to have increased 1.6 per cent in January.
- JOHN McAFEE: A time bomb is hidden beneath the Panama Papers
John McAfee is running for US president as a member of the Libertarian Party. This is an op-ed he wrote and gave us permission to run. The hack of Mossack Fonseca, in terms of the certain fallout that will affect many of the wealthiest and most prominent people on the planet, is by far the largest and most damaging cyberattack on record. I am just one of more than 200,000 people to have downloaded the Panama Papers, a record for hacked documents. It was a gold mine.
- Stunning Video the world was never supposed to see…
Pastor Williams shared this video, he has said ‘Every American must see this’. This video is a must watch. US Admiral (Ret) James “Ace” Lyons tells what Islam is like.
- Invitation by Pastor Lindsey Williams – From DVD – Elite Plans For 2016
This is an invitation by Pastor Lindsey Williams taken from the DVD ‘Elite Plans For 2016’. Lindsey Williams, an ordained Baptist minister went to Alaska in 1970 as a missionary. For three years Pastor Lindsey Williams had the opportunity to sit, live and rub shoulders with the most powerful, controlling and manipulative men on the face of this planet.
- Donald Trump Is Starting To Sound Just Like The Economic Collapse Blog (And That Is A Good Thing)
Guess what Donald Trump is saying now? Last week, I discussed how Robert Kiyosaki and Harry Dent are warning that a major crisis is inevitable, but I didn’t expect Donald Trump to come out and say essentially the exact same thing. On Saturday, the Washington Post released a stunning interview with Donald Trump in which he boldly declared that we heading for a “very massive recession”. He also warned that we are currently in “a financial bubble” and that “it’s a terrible time right now” to be investing in stocks. These are things that you may be accustomed to hearing on The Economic Collapse Blog, but to hear them from the frontrunner for the Republican nomination is another thing altogether.
- Shots Fired: Wikileaks Accuses Panama Papers’ Leaker Of Being “Soros-Funded, Soft-Power Tax Dodge”
Earlier today, for the first time we got a glimpse into some of the American names allegedly contained in the “Panama Papers”, largest ever leak. “Some”, not all, and “allegedly” because as we said yesterday, “one can’t help but wonder: why not do a Wikileaks type data dump, one which reveals if not all the 2.6 terabytes of data due to security concerns, then at least the identities of these 441 US-based clients. After all, with the rest of the world has already been extensively shamed, it’s only fair to open US books as well.” The exact same question appeared in an interview conducted between Wired magazine and the director of the organization that released the Panama Papers, the International Consortium of Investigative Journalists, or ICIJ, Gerard Ryle.
- Trump: America is headed for a ‘very massive recession’
Donald Trump said in an interview that economic conditions are so perilous that the country is headed for a “very massive recession” and that “it’s a terrible time right now” to invest in the stock market, embracing a distinctly gloomy view of the economy that counters mainstream economic forecasts. The New York billionaire dismissed concern that his comments – which are exceedingly unusual, if not unprecedented, for a major party front-runner – could potentially affect financial markets. “I know the Wall Street people probably better than anybody knows them,” said Trump, who has misfired on such predictions in the past. “I don’t need them.” Trump’s go-it-alone instincts were a consistent refrain – “I’m the Lone Ranger,” he said at one point – during a 96-minute interview Thursday in which he talked candidly about his aggressive style of campaigning and offered new details about what he would do as president.
- ISM New York Drops To September Lows As All Components Decline; Employment Plunges
While last week’s Chicago’s PMI staged a strong bounce from its recent contraction and back into expansion, New York did not. ISM New York just printed at 50.4, just barely above the contraction point, and the lowest headline print since mid 2015. The extremely noisy time series continues to swing, this time lower, with every single underlying component deteriorating in the month of March.
- Is Trump’s “Recession Warning” Really All Wrong?
Over the weekend, Donald Trump, in an interview with the Washington Post, stated that economic conditions are so perilous that the country is headed for a “very massive recession” and that “it’s a terrible time right now” to invest in the stock market. Of course, such a distinctly gloomy view of the economy runs counter to the more mainstream consensus of economic outlooks as witnessed by some of the immediate rebuttals.
- Trade deficit balloons in February
The US trade deficit widened to $47.1 billion in February, the Commerce Department said Tuesday. Economists had estimated that the excess of imports over exports — or the trade deficit — increased to $46.2 from a revised, expanded print of $45.9 billion in the prior month. “So far this quarter imports have rebounded more than exports, which is why we expect trade to subtract from Q1 GDP growth,” said BNP Paribas’ Laura Rosner in a note.
- Employment Numbers an April Snow Job
Donald Trump managed to shove his way into the spotlight again last week, claiming the US is heading for “a massive recession.” Unsurprisingly, the mainstream media scoffed at Trump’s assertion, pointing to the “great jobs report” that came out Friday.
- Pfizer Vs. Obama: The Treasury Tries To Stop Pharma’s Tax Dodge
Most experts in corporate taxes thought there was little President Barack Obama could do to force Pfizer PFE +5.01%, the largest drug company in the U.S., from moving its corporate address to Dublin, Ireland, in order to escape paying American taxes. Yesterday evening, Jack Lew, Obama’s secretary of the treasury, called Pfizer’s bluff, instituting new rules to make the move as difficult as possible. The punch hit, and investors are reeling. Now the move could intensify an election-year battle over what it means for companies to be American, and the fairness of the U.S. corporate tax code.
- China’s yuan set for biggest quarterly gain since Sept 2014
China’s yuan is poised for its biggest quarterly gain since September 2014, underpinned by firmer central bank guidance as the country’s financial markets continue to stabilise and the dollar loses momentum. Federal Reserve Chair Janet Yellen’s cautious view on U.S. rate hikes this week, which dampened views of other Fed colleagues suggesting another increase was imminent, continued to take a toll on the greenback on Thursday.
- Jobless Claims Surge Most In 2 Years As Challenger Warns Of “Significant” Jump In Retail, Computer Layoffs
With both ISM Manufacturing and Services employment indices collapsing, endless headlines of layoffs, Challenger-Grey noting Q1 as the worst since 2009, and NFIB small business hiring weak, it is no surprise that initial jobless claims is finally waking up. For the 3rd week in a row – the longest streak since July 2015. The last 3 weeks have seen a 9.1% surge in jobless claims – the biggest such rise since April 2014.
- Russia on a Gold Buying Spree
The Russians have launched into a gold buying spree. Based on recently released International Monetary Fund numbers reported at Mining.com., the Russian central bank ranked as the world’s leading gold buyer in February, adding 356,000 ounces to its reserves.
- Gold Soars 16% In Q1 – Best Start To A Year In 42 Years
Gold’s 16.1% surge in Q1 2016 ias the best start to a year since 1974. Overall, this is the best quarter since Q3 1986 and is the best performing major commodity of the year. Gold rallied this year as it cemented its status as a store of value amid financial market turbulence and concern about the global economy, which led to speculation that the Federal Reserve would pause on tightening monetary policy in the U.S. Having seen BlackRock’s gold ETF halted due to inability to meet physical demand, it appears pet rocks and barbarous relics are ‘worth’ something after all.
- NY Senate OKs Budget Bill To Boost State Minimum Wage To $15
The Republican-controlled chamber voted 61-1 for the final bill after working through the night to pass other parts of the $156 billion spending plan for the fiscal year that began Friday. “We knew we could lift millions out of poverty if we just stayed focused,” said Sen. Andrea Stewart-Cousins, leader of the Senate’s Democratic minority. “It’s a good day, even if it is a very, very long day.” The Democrat-controlled Assembly, which adjourned early Friday, was set to meet following Friday afternoon briefings to begin debate on the wage bill.
- Dollar logs worst quarter since 2010; buck hits 5-month low vs. euro
The dollar logged its worst quarterly performance in years as the Federal Reserve slowed the expected pace of interest rate hikes, citing worries about the potential domestic impact of anemic growth abroad. As measured by one gauge, the buck is about to register its worst performance during the first quarter of a year since 2008, when the index fell 6.4%, and its worst overall calendar-quarter performance since Sept. 30, 2010, when the gauge dropped about 8.5%.
- “The Cat Is Out Of The Bag” – In Interview Mossack Fonseca Founders Admit It’s Over… To Rothschild’s Delight
Days before the ICIJ released this weekend’s trove of “Panama Papers” international tax haven data involving Panamaian law firm Mossack Fonseca, Bloomberg conducted an interview on March 29 with the two founding lawyers. In it, it found that even before the full leak was about to be made semi-public (any of the at least 441 US clients are still to be disclosed), the Panama law firm knew that the game was already largely over.
- Here Are Some Of The Americans In The “Panama Papers”
With media attention squarely falling on the foreigners exposed by the Panama Papers offshore tax haven scandal, everyone has been asking for more information on who are the Americans involved in this biggest data leak in history. After all, as we showed, Mossack Fonseca had over 400 American clients. But who are they? Today, courtesy of McClatchy, we get some answers: while there are no politicians of note are in files but plenty of others. Among them: Retirees, scammers, and tax evaders, all of whom found a use for secrecy of offshore companies. As the news paper reports, “the passports of at least 200 Americans show up in this week’s massive leak of secret data on secretive offshore shell companies.”
- 2007 All Over Again: “We Are Outsourcing Our Monetary Policy”
Last night we noted the odd “messaging” that was apparent in The PBOC’s Yuan fix shifts into and after The Fed and Janet Yellen spoke… Almost as if The Fed had “outsourced its monetary policy” to China once again. But as DollarCollapse.com’s John Rubino notes, it appears Janet Yellen has instead outsoured US monetary policy to the financial markets…
- Waiters And Bartenders Rise To Record, As Manufacturing Workers Drop Most Since 2009
On the surface, the March jobs reported was better than expected… except for manufacturing workers. As shown in the chart below, in the past month, a disturbing 29,000 manufacturing jobs were lost. This was the single biggest monthly drop in the series going back to December 2009.
- Global Data: A New Scapegoat for the Federal Reserve
During March 16th’s FOMC meeting, the Fed announced that it would leave interest rates unchanged and scaled back its December projections for higher rates in 2016, 2017, and 2018. The Fed’s backtracking comes just three months after raising interest rates 25 basis points, its first hike since June 2006.
- GAO Has Been Telling Congress that Financial Regulation Is in Disarray for 20 Years
Who could blame the researchers at the Government Accountability Office (GAO) for thinking that responding to Congressional requests for studies on how to repair the nation’s ineffective maze of financial regulation is an exercise in futility. GAO has been spending boatloads of taxpayer money for the past two decades to define the problems for Congress as our legislative branch has not only failed to take meaningful corrective measures but actually made the system exponentially worse through the repeal of the Glass-Steagall Act in 1999.
- EU admits plot for FEDERAL superstate and describes Brussels attacks as an ‘opportunity’
Gianni Pitella, leader of the socialist group in the European Parliament, claimed the attack’s on the Belgian capital’s metro system and airport showed the need for even closer intergration of the 28 member nations of the bloc. He also called for a “European Intelligence Agency” to be set up to strengthen the EU’s defences against extremists. Critics warned that his outburst laid bare the ambitions for an European super-state held by many EU supporters and highlighted the long-term dangers of Britain staying tied to Brussels. Mr Pitella’s remarks came in an interview with the EU news website Euractiv.
- Big Brother Rising: US Turns Into Full-Blown ‘Surveillance State’
The recent revelation that the NSA has plans to share intercepted private communications with other domestic intelligence agencies has caused a massive backlash, with many viewing the shift as “unconstitutional.” Two experts join Radio Sputnik’s Brian Becker to discuss if the policy is just a “giant fishing expedition for law enforcement.”
- This is how World War III starts—it will be financial
In his History of the Peloponnesian War, ancient Greek historian Thucydides told us the tale of a dominant regional power (Sparta) that felt threatened by the rise of a competing power (Athens). Sparta felt so threatened, in fact, that all the moves they made to keep the Athenian rise in check eventually escalated the power struggle into an all out war. Modern political scientists call this the Thucydides Trap.
- Trend Forecaster’s Dire Warning: Massive Crash Will Wipe 12,000 Points Off Dow Jones By Late 2017
Trend forecaster and demographic researcher Harry Dent says we are in a massive bubble. And as he explains in his latest interview with Future Money Trends, central banks around the world continue to fuel this bubble with unlimited fiat money printing. The end result according to Dent? The biggest bubble burst in history… and it’s coming soon.
- Corporate Media Gatekeepers Protect Western 1% From Panama Leak
Whoever leaked the Mossack Fonseca papers appears motivated by a genuine desire to expose the system that enables the ultra wealthy to hide their massive stashes, often corruptly obtained and all involved in tax avoidance. These Panamanian lawyers hide the wealth of a significant proportion of the 1%, and the massive leak of their documents ought to be a wonderful thing. Unfortunately the leaker has made the dreadful mistake of turning to the western corporate media to publicise the results. In consequence the first major story, published today by the Guardian, is all about Vladimir Putin and a cellist on the fiddle. As it happens I believe the story and have no doubt Putin is bent.
- Panama Papers: Revelations show sheer scale of UK links to off-shore tax havens
The UK government’s pledge to crack down on off-shore tax schemes and money laundering has been laid bare after the majority of firms implicated in a huge leak were shown to be registered in British-administered tax havens. Dubbed the Panama Papers, the unprecedented release maps how a global elite of one-percenters has hidden assets, dodged sanctions and evaded taxes over the last 40 years. More than half of the 300,000 firms, believed to have used a single, secretive Panama-based law firm, are registered in British-administered tax havens. Second only to Hong Kong, 1,900 British firms, including banks, law firms, and company incorporators, feature as “intermediaries” between Mossack Fonesca and its clients.
- Putin and the ‘Dirty Dozen’: 11million leaked documents reveal how TWELVE world leaders – plus Russian leader’s inner circle, British politicians and Lords – hide their millions in tax havens
The biggest financial data leak in history has revealed how Vladimir Putin’s inner circle and a ‘dirty dozen’ list of world leaders are using offshore tax havens to hide their wealth. A host of celebrities, sports stars, British politicians and the global rich are all implicated in the so-called Panama Papers – a leak of 11million files which contain more data than the amount stolen by former CIA contractor Edward Snowden in 2013. Documents were leaked from one of the world’s most secretive companies, Panamanian law firm Mossack Fonseca, and show how the company has allegedly helped clients launder money, dodge sanctions and evade tax. Megastars Jackie Chan and Lionel Messi are among the big names accused of using Mossack Fonseca to invest their millions offshore. And the Panama Papers also reveal that the £26million stolen during the Brink’s Mat robbery in 1983 may have been channelled into an offshore company set up by the controversial law firm.
- Panama Papers: David Cameron’s father ‘ran offshore fund that paid zero UK tax for 30 years’
David Cameron’s father was allegedly involved in hiring what has been called a small army of Bahamas residents – including a part-time bishop – to sign paperwork for an offshore fund in what may have been an effort to avoid paying UK tax.
- ‘Panama Papers’ leak of 11m documents reveals how the super rich hide their money
The largest ever leak of documents has revealed how an offshore law firm has helped its clients to hide their money in tax havens. Dubbed the “Panama Papers”, the 11 million confidential documents from Mossack Fonseca show how the Panama-based firm has used shell companies to benefit the world’s rich and powerful. Some clients have laundered money, dodged sanctions and evaded tax.
- Corporate Debt Defaults Explode To Catastrophic Levels Not Seen Since The Last Financial Crisis
If a new financial crisis had already begun, we would expect to see corporate debt defaults skyrocket, and that is precisely what is happening. As you will see below, corporate defaults are currently at the highest level that we have seen since 2009. A wave of bankruptcies is sweeping the energy industry, but it isn’t just the energy industry that is in trouble. In fact, the average credit rating for U.S. corporations is now lower than it was at any point during the last recession. This is yet another sign that we are in the early chapters of a major league economic crisis. Yesterday I talked about how 23.2 percent of all Americans in their prime working years do not have a job right now, but today I am going to focus on the employers. Big corporate giants all over America are in deep, deep financial trouble, and this is going to result in a tremendous wave of layoffs in the coming months.
- The New Part-Time Job: “Get Paid $15 An Hour To Protest At The Trump Rally”
For those wondering why Trump rallies tend to devolve to pugilistic matches, where even belligerent 15-year-old protesting (or perhaps “provocative” is a better word) girls end up getting pepper sprayed much to the media’s fascination, the answer is Craig’s List ads such as the one below, in which allegedly “I’m feelin’ the Bern”-affiliated organizers provide paid positions for protesters at Trump rallies, and which provide not only shuttle buses, parking, and signs (as well as time cards) but also hand out $15/hour (as a “part-time employment”) for said protest activity “due to the economic inequality.”
- Japan Goes Neocon – Dumps Antiwar Constitution
Last September the Japanese Diet (parliament) passed legislation “reinterpreting” the nearly 70 year old strictly antiwar constitution to allow for the Japanese military to take part in overseas military operations not directly tied to the defense of Japan. Tens of thousands of Japanese took to the streets this week to protest the enactment of this new law. Will Japanese Prime Minister Shinzo Abe’s desire to be part of Washington’s “pivot to Asia” lead to a fundamental change in Japan’s position in the region?
- Does The United States Still Exist? — Paul Craig Roberts
To answer the question that is the title, we have to know of what the US consists. Is it an ethnic group, a collection of buildings and resources, a land mass with boundaries, or is it the Constitution. Clearly what differentiates the US from other countries is the US Constitution. The Constitution defines us as a people. Without the Constitution we would be a different country. Therefore, to lose the Constitution is to lose the country. Does the Constitution still exist? Let us examine the document and come to a conclusion.
- Bernanke on the Fed’s Next Move
When it comes to anticipating Federal Reserve policy, there’s no better place to turn than former Fed Chair Ben Bernanke. No longer bound by an office, Mr. Bernanke is now free to write about monetary policy as an outsider. In a recent two-part post, the former Fed Chair took some time to explain what tools the Fed has left, and where they might turn in the case of another economic downturn. Why is this important? Because many believe the Fed’s hands are now tied as a result of short-term rates being near zero, and the Fed’s balance sheet sitting at over $4 trillion.
- CITI: The ‘Uber moment’ for banks is coming — and more than a million people could lose their jobs
Banks are quickly approaching their “automation tipping point,” and they could soon reduce headcount by as much as 30%. That’s according to a new Citi Global Perspectives & Solutions (GPS) report on how financial technology is disrupting banks. “Banks’ Uber moment will mean a disintermediation of bank branches rather than the banks themselves,” the report said.
- Deflation Welcome! Lower Third of Population Goes Deeper in Debt, Cannot Afford Any Price Increases
A new PEW study on Household Incomes and Expenditures goes a long ways towards explaining why economists who expected a big jump in consumer spending based on falling gasoline prices were dead wrong. The study shows that although expenditures recovered from the downturn, income did not. Also, low-income families spent a far greater share of their income on core needs, such as housing, transportation, and food, than did upper-income families. Households in the lower third spent 40 percent of their income on housing, while renters in that third spent nearly half of their income on housing, as of 2014.
- The Eurogroup Made Simple
The Eurozone is the largest and most important macro-economy in the world. And yet, this gigantic macro-economy features only one institution that has legal status: the European Central Bank, whose charter specifies what powers the Frankfurt-based institution has in its pursuit of a single objective: price stability. Which leaves the question begging: “What about economic goals, beyond price stability, like development, investment, unemployment, poverty, internal imbalances, trade, productivity?” “Which EU body decides the Eurozone’s policies on these?”
- 7 Million at Risk from Man-made Quakes
Interesting Vox article on natural and manmade earthquakes my fellow Vet and cohort in writing Mark Jamison sent me. This year for the first time ever the USGS is including a map of areas in the US which may be prone to human-induced earthquakes” in addition to areas which are prone to natural earthquakes.
- “Spike in Defaults”: Standard & Poor’s Gets Gloomy, Blames Fed
Credit rating agencies, such as Standard & Poor’s, are not known for early warnings. They’re mired in conflicts of interest and reluctant to cut ratings for fear of losing clients. When they finally do warn, it’s late and it’s feeble, and the problem is already here and it’s big. So Standard & Poor’s, via a report by S&P Capital IQ, just warned about US corporate borrowers’ average credit rating, which at “BB,” and thus in junk territory, hit a record low, even “below the average we recorded in the aftermath of the 2008-2009 credit crisis.”
- IBM Laying Off 1000 Workers In Germany
In recent weeks, the stock of IBM has staged a dramatic rebound surging from a February 11 low of $118 to $150 today, on what we previously assumed had to be another long-overdue bout of stock buybacks. However, for that to make sense, the company – already at risk of being downgraded if it did not take further cost-cutting measures to offset the additional debt interest expense – would need to engage in another round of mass layoffs. This is precisely what happened moments ago when Germany press reported that Big Blue is cutting some 1000 jobs in Germany.
- U.S. Home Prices Are 14% Overvalued According To Bank of America
There has been an odd shift when it comes to US sentiment toward home ownership: while in the past, the higher home prices rose the greater the demand was for housing (leading ultimately to the housing debt bubble of 2006), this time around we are getting increasingly more frequent indications of just the opposite. Some have started to notice: as we noted one week ago, in its traditionally cheerful assessment of the US housing market, the NAR’s Larry Yun snuck in an unexpected warning.
- First Ocean Freight Rates Collapse to “Zero,” China Freight Index Plunges to Record Low, Bailouts Loom
The amount it costs to ship containers from China to ports around the world has plunged to historic lows. As container carriers are sinking deeper into trouble, whipped by lackluster global demand and rampant oversupply of container ships, they’re escalating a brutal price war with absurd consequences.
- This Shows Financial Reality Has No Place in Today’s Markets
The shares of OHL Mexico, the Mexican subsidiary of Spanish construction behemoth OHL, soared over 10% to 26.72 pesos on Monday morning. It was the stock’s biggest climb in over 8 months. The reason for the market’s new-found enthusiasm for the shares was somewhat counter intuitive: the company had just announced that it had been hit by the biggest fine ever imposed by Mexico’s securities authority, the CNBV. The company had been penalized for irregular accounting practices and was forced to pay 71.7 million pesos in damages — a $4-million slap on the wrist.
- Peter Boockvar Warns Western Central Planners Are In Now Deep Trouble
Outside of another round of Pavlov’s (Yellen’s) panting dog (markets) getting more food, a few things were firmly established yesterday. Firstly, it really doesn’t matter what any regional Fed President says, especially those that don’t vote as Yellen is clearly the boss and what she wants is what she’ll get…
- Solid Sale Of 7 Year Paper Ends Streak Of Poor Treasury Auctions
Following two disappointing auctions earlier this week when first the 2Y and then the 5Y auctions either demonstrated a substantial drop off in bid-side interest or priced wildly through the when issued, we said to await today’s 7Y auction for the true picture of demand for primary paper, as the first auction took place when Europe was out for Easter vacation, and the second one took place just as Yellen speaking at the Economic Club yesterday.
- Attention President Obama: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation
While the Fed has long been focusing on the revenue part of the household income statement (which unfortunately has not been rising nearly fast enough to stimulate benign inflation in the form of nominal wages rising at the Fed’s preferred clip of 3.5% or higher), one largely ignored aspect of said balance sheet has been the expense side: after all, for any money to be left over and saved, income has to surpass expenses. However, according to a striking new Pew study while household spending has returned to pre-recession levels (the average household spent $36,800 in 2014) incomes have not.
- Doug Casey and the War on Cash: “We Are Truly on the Edge of a Precipice”
Recently, my friend and colleague Louis James, editor of International Speculator, sat down with Doug Casey to discuss the ongoing “War on Cash.” Doug reveals what people looking to protect their money should do. As the War on Cash has gone into overdrive lately, this is a timely discussion that you’ll find below.
- How Have Hedge Funds Been Affected By Oil Prices?
After suffering large losses in 2014, trying to find a bottom in crude oil, the hedge fund industry wizened up: In 2015, it reduced its weightage to the energy sector to the lowest levels since 2008, saving themselves from profound losses when crude hit new 12-year lows—levels not seen since 2004. It was a short-lived euphoria, however, as most missed the stellar run in crude from the lows and are scrambling to enter after the rebound.
- Job Growth Doesn’t Mean We’re Getting Richer
In response to recent claims by the Obama administration and others that “millions of jobs” have recently been created, I examined the data here at mises.org to see if the claims were true. It turns out that job growth since the 2008 recession has actually been quite weak, and hardly something to boast about. Nevertheless, our conclusions from these analyses tend to rest on the idea that job growth is synonymous with gains in wealth and economic prosperity. But is that a good assumption? In an unhampered market, the answer would be no, for several reasons.
- Greece Demands Explanation From IMF Over Leaked Transcript
Greek politicians wasted no time in seeking a response from the IMF over the leaked transcript released earlier today by Wikileaks suggesting the IMF may threaten to pull out of the country’s bailout as a tactic to force European lenders to more offer debt relief, and which according to the Greek government was “interpreted as revealing an IMF effort to blackmail Athens with a possible credit event to force it to give in on pension cuts which it has rejected.” According to Reuters, “Greece demanded an explanation from the International Monetary Fund on Saturday after an apparent leaked transcript suggested the IMF may threaten to pull out of the country’s bailout as a tactic to force European lenders to more offer debt relief.”
- Wikileaks Reveals IMF Plan To “Cause A Credit Event In Greece And Destabilize Europe”
One of the recurring concerns involving Europe’s seemingly perpetual economic, financial and social crises, is that these have been largely predetermined, “scripted” and deliberate acts. This is something the former head of the Bank of England admitted one month ago when Mervyn King said that Europe’s economic depression “is the result of “deliberate” policy choices made by EU elites. It is also what AIG Banque strategist Bernard Connolly said back in 2008 when laying out “What Europe Wants”
- Price Controls May Be On the Way
If you thought negative interest rates were as bad as it could get with central banks, you might be in for a surprise. Central banks have been so spectacularly unsuccessful with their accommodative monetary policies that they are discussing pulling out all the stops to get the results they want. They fail to realize that the reason prices aren’t rising is because they really want and need to fall. Bad debts weren’t liquidated during the last financial crisis, the debtors were merely bailed out. Overpriced assets weren’t allowed to be reduced in price. Central banks pumped trillions of dollars into the economy to attempt to paper over the recession. Market forces want to drive prices down, while central banks attempt to prop them up. So what to do when central banks aren’t getting their way?
- Relative Strength in Silver
Gold went down (as the muggles would measure it, in dollars). It dropped almost 40 bucks. Silver fell almost 60 cents. Since silver fell proportionally farther than gold, the gold-silver ratio went up. Why do we keep reiterating that gold goes nowhere, that it’s the dollar which mostly goes down over long periods of time and sometimes up as in 2011-2015? Why do we insist that the dollar be measured in gold, and that gold cannot be measured in dollars the way a steel meter stick cannot be measured in rubber bands? Some ideas that are impossible to understand using the dollar paradigm. For example, gold is in the process of withdrawing its bid on the dollar. This will have devastating consequences, which the word “reset” does not begin suggest. If the dollar is money, then this assertion — gold bids on the dollar — is incomprehensible. However, if gold is money then that makes the dollar just the irredeemable scrip issued by the Fed in order to finance its purchase of Treasury bonds. Who would be eager to trade his money to buy such scrip?
- The Pitfalls of Currency Manipulation – A History of Interventionist Failure
Readers may recall that the last G20 pow-wow (see “The Gasbag Gabfest” for details) featured an uncharacteristic lack of grandiose announcements, a fact we welcomed with great relief. The previously announced “900 plans” which were supposedly going to create “economic growth” by government decree seemed to have disappeared into the memory hole. These busybodies deciding to do nothing, is obviously the best thing that can possibly happen.
- Gerald Celente Issues Trend Forecast For Gold As Global Economy Falters
For several days, gold prices fell on hawkish comments from a number of regional Federal Reserve Bank presidents signaling support for an interest-rate rise, pointing to a possible increase at the upcoming Federal Open Market Committee meeting in late April. They reasoned, as has President Obama and the establishment business media, that anyone questioning the strength of the US economy was “peddling fiction,” and that a Fed rate hike, the second since 2006, was in order…
- ALERT: Important Update On The War That Is Raging In The Gold & Silver Markets
The commercial shorts are now at a level (real-time) that raises serious concern. In fact, the commercials are close to one of their largest short positions in history. The last time the commercials held this large of a short position in silver was in 2008. Again, that does not mean that the price of silver cannot head significantly higher in the short-term.
- Americans Have Been Turned Into Peasants – Time To Fight Back?
In the 1970’s, Goldman Sachs CEO Gus Levy famously encouraged his employees to be “long-term greedy.” In order to understand how far we have fallen as an economy and culture, it’s important to understand the meaning of the phrase and reflect upon it. “Long-term greedy” implies two very important principles that define a well functioning and ethical free market economy. First, is the unrepentant belief that earning a good profit and striving for financial success is a reasonable and admirable goal for both individuals and corporations. Second, is the understanding that such financial success should be earned, not stolen. If one’s focus is the long-term, the implication is that you’re committing yourself to building something real, and that the marketplace will ultimately reward you handsomely for your product or service.
- Is A Gas War Between The U.S. And Canada About To Start?
The United States and Canada work well together. The countries share the world’s largest and most comprehensive trade relationship, exchanging more than $2 billion per day in goods and services; the U.S. is Canada’s largest foreign investor and Canada is the third-largest foreign investor in the U.S. The partnership clearly isn’t broken, but it may need some mending as bilateral and international gas trade stands to complicate matters in short order.
- Why the Fed rate talk was ‘a bunch of nonsense’
The Federal Reserve was never hiking rates four times this year. Investors didn’t believe it, and now Fed Chair Janet Yellen has all but explicitly acknowledged it. Indeed, Yellen’s blockbuster speech Tuesday assuring that the central bank would go slowly on future adjustments to monetary policy only caught some of the market by surprise. Others realized there was virtually no chance of a hawkish Fed in 2016. “Central bankers at the Fed bark but they won’t bite,” Peter Schiff, frequent Fed critic and founder of Euro Pacific Capital, told CNBC.com. “I knew all that talk was a bunch of nonsense.”
- Emerging-Market Currencies Set for Best Month in 18 Years on Fed
It’s been at least 18 years since emerging-market currencies had it this good as the Federal Reserve adopted a gradual approach to its rate-increase cycle, fueling optimism that capital inflows can be sustained. A Bloomberg gauge of 20 currencies gained for a fourth day after Fed Chair Janet Yellen said that policy makers would act “cautiously” as they look to raise borrowing costs. Stocks rallied, sending shares in Shanghai up the most in a month, while South African equities rebounded from a two-week low and Russia ended the longest run of losses since 2011. The premium investors demand to hold emerging-market debt dropped from the highest since March 16.
- Central Bank Policy Sparking Gold Demand in Europe
When we talk about increasing gold demand, the focus tends to fall on Asia. Earlier this week, we reported surging investor demand for the yellow metal in China. The Japanese have also gone on a gold buying spree since that country’s central bank plunged interest rates into negative territory. But it isn’t just Asians who are bullish on gold. Analysts say they see signs of growing demand for the metal in Europe as well.
- Boeing to Cut More Than 4,500 Jobs
Boeing Co. on Tuesday said it planned to cut more than 4,500 jobs by June, as the company accelerates cost-cutting efforts to keep pace with customers demanding less expensive jetliners. The cuts come even as Boeing has booked record orders for its jets and is increasing production of its single-aisle and twin-aisle aircraft. But the company has been losing market share to rival Airbus Group SE. Boeing’s commercial unit expects to cut about 2,400 positions by attrition and around 1,600 through voluntary layoffs, a company spokesman said. This includes the culling of “hundreds” of managers and executives, some through involuntary layoffs.
- Dollar Falls to Five-Month Low on Slower Fed Rate Path Outlook
The dollar fell to a five-month low against the euro on speculation the Federal Reserve will take a slower path to higher interest rates as the central bank factors in headwinds from slowing global economic growth. A gauge of the U.S. currency headed for the biggest quarterly loss since 2010 after Fed Chair Janet Yellen said Tuesday the central bank will act “cautiously” as it looks to withdraw monetary stimulus. The greenback has fallen against all of its 31 major peers in March with Russia’s ruble and Brazil’s real posting the biggest gains, helping emerging-market currencies to their best month in 18 years.
Lindsey Williams: I feel a moral obligation to tell you the truth about Donald Trump…
“VOTE AS YOU WISH, AND LET ME TELL YOU ABOUT TRUMP – – A personal note from Peter Ticktin who knows the guy from high school:
As a law firm, we at The Ticktin Law Group do not like to get involved in politics. As soon as we endorse one side, we risk alienating everyone on the other side. Also, our lawyers and staff are, themselves, on both sides. Politics is not our game. However, Justice is!
If you saw a guy get publicly smeared, and you knew him well from the days you were friends and seniors together in high school, if you knew him to be a decent and honest man, would you want to say something? This is why I need to share what I know.
I was aghast at watching last night’s debate. It was a set-up. The moderators, Cruz, and Rubio were all like little alligators trying to take a bite out of Trump. Yes, Donald Trump has had some failures, but he has been exceedingly successful. None of this came out. Instead, there was a general attack. Rubio simply makes up lies. He pretends that Trump has small hands and makes fun of him for something which isn’t even real. He pretends that Donald wets his pants, and makes fun of him, as though it was true, and then he calls Donald Trump a “Bully.”
I am not suggesting that you should vote or not vote for anyone. I just need to defend a former friend who is being smeared.
Like Donald Trump, I attended New York Military Academy (“NYMA”) for high school. In fact, in our senior year, together, Donald was my captain, and I was his 1st Platoon Sergeant. I sometimes joke that I ran his first company for him, Company “A.”
People don’t really change much from the ages of 17 and 18, and I know this guy. I know him to be a good decent guy. We lived and breathed an Honor Code in those years. It wasn’t just a rule. It was our way of life. Neither Donald, nor any other cadet who graduated with us would ever lie, cheat, or steal from a fellow cadet. These values became irreversibly intertwined in the fabric of our personalities, of who we are.
Of the 99 guys (no girls in those days) in our class, there is not one who I know who has a bad word to say about Donald Trump. Think of it. With all the jealousies which arise in high school and thereafter, with all the potential envy, not one of us has anything other than positive memories of this man. How could we? He was an “A” student, a top athlete, and as a leader, he was highly respected. We never feared him, yet we never wanted to disappoint him. He had our respect. He was never a bigot in any way, shape or form. He only hates those who hate. Of course he denounces the KKK.
As to the discussion with the New York Times, it is his choice to release the ‘off the record’ remarks. However, if he does, it opens the door for all political opposition to make that demand for everyone, and that means that our press will never get those ‘off the record’ remarks which help them to understand the realities of the campaign. Moreover, the idea that Donald Trump confessed some alternate theory of his position is preposterous. Can anyone believe that all those NY Times reporters are walking around knowing some deep dark nasty secret about a guy who is seeking an endorsement?
The Republican establishment is afraid of Donald Trump. Why? They are afraid that he will lose to Hillary. They don’t hate Donald. They hate her. They are so fearful that they fail to see that by expanding the base of voters for Trump, he is more likely to win.
Watching the chorus of whiners, decriers, denigrators, and self-righteous put-down experts from so many directions, from Mit Romney, to Megyn Kelly, Little Mario, it has to make you wonder. Why? Why are so many people so angry with Donald Trump, that they are lying, name calling, ridiculing, and demeaning him as they do. Either they are afraid, or they know him to be evil.
This is why I feel the need to speak out at this time. I know this man. He is a lot of things, but he is not evil. He is a decent honest guy who loves this country, and who is willing to sacrifice so much of what is left of his life, because he knows that this country needs to be fixed, and that it is going to require someone who can do the job. He just doesn’t see anything around him other than political hacks, so he is willing to take this huge responsibility.
I’m not saying that he is the only one who can do the job. My point is simply as to his motivation and his goodness.
This next decade is going to be one of major changes. We all see the climate changing, and the world food supply is getting lower. Our fish stock around the world is running low. Oil prices will cause countries to fail. The Middle East is beyond repair, and we have become weak and ineffective around the world. Donald Trump sees the issues and knows that he can assemble leaders who would have the best chance of fixing things. This is why he is running. He does not need it for his own aggrandizement. He doesn’t need another big jet or to take up residence in the White House. He just wants things to be fixed, and he knows that the politicians won’t fix anything.
I knew Donald Trump and was close to him in our senior year in high school. I just want you to know that there is nothing to fear from him. His character is as good as it gets. He is a patriot, taking on a heroic task, and being thanked by massive abuse.
If you want to see a true reflection of a man, look at his children. Need I say more?”
Latest News From March 25, 2016 to March 31, 2016:
- Negative Interest Rates: Causes, Consequences and Ramifications
Central Banks are under the mistaken belief that negative interest rates could be the magic kiss which turns their toad economics into Prince Charmings. Why exactly do they think this? What makes Draghi, Kuroda, and others think imposing negative interest rates will stimulate credit and lending in their respective economies? It is important to understand the logic behind this historic moment in global monetary history. Negative interest rates are unprecedented and show how far we have gone off course in terms of policy related to money and credit markets. They are already having a tremendous effect in several European countries and Japan, and they may eventually be coming to the US. Negative rates hold significant future implications for gold as well.
- SunEdison shares tumble 55% on bankruptcy filing fears
Shares of renewable power firm SunEdison plummeted 55% Tuesday as it teetered on the edge of bankruptcy amid slumping oil prices and swirling questions over the company’s accounting practices. SunEdison faces a “substantial risk” of bankruptcy, according to the U.S. Securities and Exchange Commission filing by a subsidiary, TerraForm Global. SunEdison develops, installs and operates alternative energy projects.
- 23 Percent Of Americans In Their Prime Working Years Are Unemployed
Did you know that when you take the number of working age Americans that are officially unemployed (8.2 million) and add that number to the number of working age Americans that are considered to be “not in the labor force” (94.3 million), that gives us a grand total of 102.5 million working age Americans that do not have a job right now? I have written about this before, but today I want to focus just on Americans that are in their prime working years. When you look at only Americans that are from age 25 to age 54, 23.2 percent of them are unemployed right now. The following analysis and chart come from the Weekly Standard…
- Dallas Fed Respondent Sums It Up: “Anyone Saying We’re Not In Recession Is Peddling Fiction”
Headlines will crow of the seasonally-adjusted ‘beat’ of expectations for the Dallas Fed survey (-13.6 vs -25.8 exp) but this is the 15th month in contraction (below 0) – something only seen in recession. Scratching below the surface we see employees, workweek, and capex all in contraction and forward expectations for new orders and employment tumbled. Perhaps that reality is what drove one respondent to rage, “anyone who says the economy is not in recession is peddling fiction.”
- Q1 GDP Crashes To 0.6%: Latest Atlanta Fed Estimate
Earlier today we said that following the abysmal January spending data revision that “the Atlanta Fed will have no choice but to revise its Q1 “nowcast” to 1.0% or even lower, which would make the first quarter the lowest quarter since the “polar vortex” impacted Q1 of 2015, and the third worst GDP quarter since Q4 2012. It means one-third of already low Q1 GDP growth has just been wiped away.” It was “even lower.”
- US Goods Trade Balance: Exports Stabilise at Low Levels
There was a small recovery in exports for February, which offers some hope that the sector has bottomed out. The latest US trade deficit for goods increased slightly to US$62.9bn for February, from a revised US$62.2bn the previous month and was slightly above the consensus US$62.4bn. Compared with February 2015, there was a widening of over US$7bn in the deficit.
- Chinese Seizing Golden Opportunity; Gold Demand Surging
Generally speaking, rising prices tend to temper demand, but when it comes to gold in China, the recent price rally has created the opposite effect. As the Wall Street Journal put it, “Chinese investors see a golden opportunity.” Demand for gold has surged in China over the last several weeks, during a period generally considered out of season. And it’s not typical Chinese jewelry purchases driving the demand. Chinese investors are buying gold coins and bars.
- Seven years after the Great Recession, some Chicago suburbs may never recover
Mitchell and Loria Versher say they were looking for one thing when they bought their first home in South suburban Markham: “Stability.” They might have been better off buying swampland in Florida. In retrospect, July 31, 2007, was a bad day to go shopping for property anywhere. But the modest 900-square-foot Cape Cod-style home the Vershers bought that day for $137,000, on the eve of the worldwide credit crunch, has fared especially badly, by any standard.
- How They Brainwash Us — Paul Craig Roberts
Anyone who pays attention to American “news” can see how “news” is used to control our perceptions in order to ensure public acceptance of the Oligarchy’s agendas. For example, Bernie Sanders just won six of seven primaries, in some cases by as much as 70 and 82 percent of the vote, but Sanders’ victories went largely unreported. The reason is obvious. The Oligarchy doesn’t want any sign of Sanders gaining momentum that could threaten Hillary’s lead for the Democratic nomination.
- Heidi Cruz: Her Evil Past Is Now Being Revealed
While I am aware that Heidi Nelson Cruz apparently does suffer from deep depression, just after Hillary Rodham Clinton, she is the next person to be feared the most in this presidential race for 2016. Yes, I believe in common decency, but I also stand for the dignity of women, which means that they must be respected and treated equally even if it requires the truth. In an article written by Jesse Byrnes for The Hill that was released today on March 25, 2016, under the title “Trump aide fulfills threat to ‘spill the beans’ on Heidi Cruz,” he reports on the recent interview on MSNBC that Steve Kornacki had with Katrina Pierson who is an aide for Donald Trump.
- Chemtrail Flu: Have You Got It Yet?
Pastor Williams: ‘There is a near epidemic going on in America.’ ‘You’re sick. Your nose is stuffy. Your body aches, You’re sweaty, coughing, sneezing and you don’t have enough energy to get out of bed. It’s not the flu. It’s a conspiracy, according to Dr. Len Horowitz. His opinion is not based on conspiracy theory but on conspiracy fact. Over the past 10 years, Horowitz has become America’s most controversial medical authority. A university-trained medical researcher, Horowitz, 48, charges that elements of the United States government are conspiring with major pharmaceutical companies to make large segments of the population sick. The mainstream media is reporting that hospital emergency rooms are jammed with patients suffering from a bizarre upper respiratory infection that doesn’t quite seem like a virus. They are reporting that it’s a “mystery” flu and that the flu vaccines are ineffective against it. “That’s all hogwash, bogus nonsense”, says Dr. Leonard Horowitz.
- HARRY DENT: Civil unrest is coming to America
I made a confession to our Boom & Bust subscribers last month. While I generally advise against owning most real estate, I have a secluded property in the Caribbean. It’s the only property I own (I rent my home in Tampa), and I know for a fact that its value will probably depreciate in the great real-estate shakeout I see ahead, though most likely by half as much as a high-end property in Florida. I own this property because I see rising chances for civil unrest in the inevitable downturn ahead, especially in the US. I want a place to go if things get really bad, and it looks increasingly likely that they will. The evidence for that is piling up in this year’s presidential race.
- Is This The Debt Jubilee?
Not so long ago the financial world viewed certain numbers as limits beyond which lay trouble. Interest rates near zero, for instance, were thought to risk destabilizing the banking system. And government fiscal deficits above 3% were considered so dangerous that exceeding this level was prohibited by the Maastricht treaty that all eurozone members were required to sign. Those numbers — 0% and 3% — are still considered bad. But now for the opposite reason: They’re insufficiently aggressive. A big part of the world, as everyone now knows, operates with negative interest rates. And prominent economists are urging even greater negativity as a way to make government debt profitable and get people borrowing and spending again.
- Empty Buildings and Wasted Debt: The Chinese Economic “Miracle”
There’s no doubt that the Chinese economic miracle is real. When you move 500 million people from rural to urban settings, taking them from small farms and putting them in a specialized labor force, the economic dividend is massive. That’s how you keep GDP growing more than 7% for 25 years. But along the way, they wanted more. Beyond building factories and housing for new arrivals, local politicians started building massive, wasteful projects. Political meeting halls… Unused apartment buildings… Empty shopping malls… Part of it might have been poor economic planning, but a bigger, and more common, problem was at work.
- Global Economy Dying Pig-No More Rate Hikes-Rob Kirby
Macroeconomic researcher Rob Kirby predicted the Federal Reserve’s interest rate increase late last year “would be one and done.” Kirby explains, “They had no business raising rates in the first place because the economy was not exhibiting enough strength to warrant any rate raises whatsoever, and there won’t be any more interest rate raises because the economy continues to roll over. Doctored economic data cannot make the sick pig that the global economy really is look any better. It doesn’t matter how much lipstick you put on that dying pig. It’s still a dying pig.”
- Mitsui Sees First Loss Since 1947 Amid $2 Billion Writedown
Mitsui & Co., Japan’s second biggest trading house, forecast its first net loss since it was founded in its modern form in 1947 due to impairment charges on mining and energy projects from South America to Australia. The Tokyo-based trading house expects a net loss of 70 billion yen ($623 million) in the fiscal year ending March after booking impairment charges of 225 billion yen on assets including the Browse LNG project in Australia and the Caserones copper development in Chile, according to a statement Wednesday. Mitsui previously forecast net income of 190 billion yen.
- This Game’s Almost Over: Central Banks Are Running Out Of Options
Going into last week’s Fed meeting, the general consensus was that they would not raise rates. When they hiked rates by a quarter point in December, they projected there would be four additional quarter-point raises in 2016. That’s starting to look fishy as we’re almost a quarter of the way through the year and there’s still no hike. Sure enough, the Fed left rates unchanged as expected last week, and revised their rate expectations lower through 2016. Now, they anticipate only hiking another half point by the end of the year.
- The reserve currency curse
Is reserve currency status a blessing or a curse? The answer might seem obvious, as reserve currencies have been shown to confer lower borrowing costs on their issuers. But what of the borrower who, enticed by low interest rates, borrows more than they can pay back? Naturally the result will be a default. However, for the issuer of a reserve currency that is unbacked by a marketable commodity, such as gold, in the event that they borrow too much, they can just print more reserves. While this avoids default indefinitely, it also hollows out the economy, erodes the capital stock, reduces the potential growth rate and, eventually, leads to a dramatic devaluation of the currency and loss of reserve status. History has not been kind to countries that have followed this path, nor to their financial markets. In my view, the grave investment risks associated with the possible eventual loss of the dollar’s reserve status are not priced into financial markets.
- Well That Didn’t Work
The Bank of Japan and European Central Bank eased recently, which is to say they stepped up their bond buying and/or pushed interest rates further into negative territory. These kinds of things are proxies for currency devaluation in the sense that money printing and lower interest rates generally cause the offending country’s currency to be seen as less valuable by traders and savers, sending its exchange rate down versus those of its trading partners. This was what the BoJ and ECB were hoping for — weaker currencies to boost their export industries and make their insanely-large debt burdens more manageable.
- Belgium Terror Just the Beginning of Insecure World-Egon von Greyerz
Financial expert Egon von Greyerz (EvG) says terror attacks, like the one that just happened in Brussels, can destabilize the entire world. EvG, who lives in Switzerland, explains, “This is obviously a very sad day for our friends in Belgium, but at the same time, we know this is just the beginning, not only in Europe, but with the whole world. We are going to see a much more insecure world. It is worldwide. We know that the refugee problem has included a number of potential terrorists. . . . The problems that will be in the west were created by the U.S. and Europe. The problems that were created in the Middle East and North Africa will lead to more of this. There is anarchy in Libya. There is anarchy in Iraq, and the West has created this. So, they are paying us back, and I don’t think this is finished. We will see a less secure world, and it is not just Europe. The U.S. will see similar problems.”
- Central Banks Move Into Crypto-Currencies As Part Of Cashless Society Hustle
Top UK Telegraph journo Ambrose Evans-Pritchard just wrote about this planned crypto-currency in what is either an incredibly stupid and uneducated article or pure propaganda… it was titled “Central banks beat Bitcoin at own game with rival supercurrency.” The article is horrible central bank happy-talk that reads like the Bank of England wrote it for him and starts off with a blatant lie only three words in… this new RScoin, put out by the central bank of England, has not BEAT bitcoin. It is worse in every imaginable way than bitcoin… right down to the name. RScoin… central banker types aren’t exactly the most creative. We’ll call it FiatCoin around here.
- Lloyd’s of London Takes `Massive Hit’ From Low Returns
Lloyd’s of London reported a 30 percent drop of full-year profit as the world’s largest insurance market was hurt by continued pressure on pricing and the lowest investment returns since at least 2001. Earnings declined to 2.1 billion pounds ($3 billion) for 2015 as income from investments, primarily in fixed income, sank 60 percent to 400 million pounds with the majority earned in the first half of the year, according to the company’s annual report Wednesday. Weaker insurance pricing in 2015 is expected to continue this year, hurting profitability. “We’ve taken a double hit from reduced margins in underwriting and lower investment yield,” Chief Executive Officer Inga Beale said in an interview with Bloomberg Television Wednesday. “On the investment side we saw a dramatic reduction in 2015 that was a massive hit” to earnings.
- Economic Collapse: Marc Faber Issues Dire Warning for America
U.S. on Verge of Economic Collapse, Says Marc Faber. Adding more emphasis on his belief that the U.S. is on the verge of an economic collapse, perma-bear investor Marc Faber advised retail investors not to put money in U.S. stocks; instead, according to Faber, investors should pour their funds into emerging market equities. The publisher of The Gloom, Boom & Doom Report newsletter told Bloomberg that U.S. stocks are highly priced by several measures, including price-to-sales, price-to-earnings, and market cap-to-gross domestic product (GDP) ratios, whereas emerging markets have corrected significantly since 2006 and 2011.
- U.S. Mining Losses Last Year Wipe Out Profits From Past Eight Years
The U.S. mining industry—a sector that includes oil drillers—lost more money last year than it made in the previous eight. Mining corporations with assets of $50 million or more recorded a collective $227 billion after-tax loss last year, according to Commerce Department data released Monday. That loss essentially wipes out all the profits the industry had made since 2007.
- Here We Go Again: Government Ramps Up Borrowing As Private Sector Slows
This morning, US existing home sales plunged and the Chicago Fed’s national activity index turned negative. Both are obvious signs of a slowing economy. Anticipating this kind of news, Credit Bubble Bulletin’s Doug Noland in his most recent column analyzed the Federal Reserve’s quarterly Z.1 Report for signs of changing financial trends, and found something potentially serious.
- Michael Hudson on Debt Deflation, the Rentier Economy, and the Coming Financial Cold War
Michael Hudson has sent us the transcript of his newly-released interview with Justin Ritchie on
February 26 with XE Podcast
- NIRP Is Absolutely Crushing Big Parts Of The Finance World
Savers are the obvious victims of the past few years’ plunge in interest rates. But there are other casualties, including money market funds, which have no reason for existing if their yield is negative, and insurance companies, which price their policies on the assumption that they’ll earn good returns on their bond portfolios. As bond yields plunge, the returns insurance companies can expect are also plunging, forcing them into huge write-offs and, soon, steep premium increases that will scare away customers.
- US Military Increases South China Sea Presence; China Balks
In response to China’s assertive moves in the South China Sea, the U.S. State Department struck a deal with the government of the Philippines to permit American military forces to operate from five Philippine bases. The Chinese seem more annoyed than intimidated by the increased American military presence in the region.
- Interest Rates Are Never Going Back to Normal
Let’s see… U.S. corporate earnings have been going down for three quarters in a row. The median household income is lower than it was 10 years ago. And now JPMorgan Chase has increased its estimated risk of a recession to about one in three. These things might make sober investors wonder: Is this a good time to pay some of the highest prices in history for U.S. stocks? Apparently, they don’t think about it… Last week U.S. stocks rose again, after the Fed announced that it would go easy on “normalizing” interest rates. The Dow rose 156 points on Thursday, putting it in positive territory for 2016.
- The Government Wants to Give You Free Cash
Could the government start handing out free cash? It sounds crazy. But believe it or not, it’s a real possibility. In fact, an Ivy league economist just predicted it will happen within five years… If you’ve been reading the Dispatch, you know the Federal Reserve has used crazy monetary policies to “stimulate” the economy since the 2008 financial crisis. These policies have been huge failures. After seven years, the U.S. economy is barely growing. Yet, instead of acknowledging its failure, the government is preparing to double down. And its friends in the lapdog media think it’s time for “helicopter money.”
- Gold and Gold Stocks – A Change in Market Character
Similar to many others, we have been waiting for some sort of correction in gold and gold stocks, but obviously, not much has happened in this respect so far. We have written quite a lot about gold and gold stocks between August 2015 and February 2016, because we felt a good opportunity was at hand – a short term trading opportunity at the very least, but one with the potential to become more than that.
- NATO’s RAGE: Trump Questions America’s Role in ‘Nation-Building’ – Talks of Restoring Russian Ties
GOP presidential frontrunner Donald Trump unveiled his noninterventionist platform to The Washington Post’s editorial board and in the process – questioned America’s relationship with the North Atlantic Treaty Organization…
- China Sends Fed A Warning: Devalues Yuan By Most In 2 Months
With the USD Index stretching to its longest winning streak of the year, jawboned by numerous Fed speakers explaining how April is ‘live’ (and everyone misunderstood the dovishness of Yellen), it appears that The PBOC wanted to send a message to The Fed – Raise rates and we will unleash turmoil on your ‘wealth creation’ plan. Large unexpected Yuan drops have rippled through markets in recent months spoiling the party for many and tonight, by devaluing the Yuan fix by the most since January 7th, China made it clear that it really does not want The Fed to hike rates and cause a liquidity suck-out again.
- This map shows every country’s major export
Bank of America Merrill Lynch is out with its “Transforming World Atlas” research note, which examines global economic trends through a series of maps. One particular map that stood out showed each country’s major export, using data from the CIA World Factbook. Notably, many countries heavily rely on commodities as their primary source of foreign income. Consequently, one can use this as a map to see which country gets hit the hardest when commodities drop. For example, those in navy were hardest hit by the oil crash.
- These are the fastest growing and shrinking counties in America
The American population is always changing in various ways. The Census Bureau recently released their annual estimates of population change in the 3,142 counties and county equivalents of the US, showing how populations grew and shrank between July 1, 2014, and July 1, 2015. Using those estimates, we made a map showing the total population change in each county. Red counties had a loss of population, and blue counties saw increases. As has been the overall trend for decades, the Northeast and Midwest tended to see a loss in population, while the big cities of the South and West, along with oil-rich regions in west Texas and North Dakota, saw big increases.
- HEDGE FUND MANAGER: This is ‘no longer an investment market but a battlefield’
London-based hedge fund manager Crispin Odey, who runs $11 billion in assets, said this is “no longer an investment market but a battlefield.” In Odey’s OEI Mac fund’s February investment update, Odey slammed central banks for lowering or not raising interest rates. “Several years of watching central banks watching central banks responding to ever falling productivity numbers by reducing interest rates have shown that they can effect asset prices with their actions, but that not only do they have almost no effect on economic activity, but they positively damage it,” Odey said. This year has been brutal for Odey. The OEI Mac fund, which invests in Odey’s flagship European fund, finished January up 8.3% before seeing all its gains wiped out after falling -10.6% in February.
- Swiss National Bank Admits It Spent $470 Billion On Currency Manipulation Since 2010
By now it is common knowledge that when it comes to massive, taxpayer-backed hedge funds, few are quite as big as the Swiss National Bank, whose roughly $100 billion in equity holdings have been extensively profiled on these pages, including its woefully investments in Valeant and the spike in its buying of AAPL stock at its all time high. But while the SNB’s stock holdings are updated every quarter courtesy of its informative SEC-filed 13F (we wish the Fed would also disclose the equities it holds courtesy of its Citadel proxy), getting a gllimpse of the flow is more problematic, and involves waiting for the hedge fund’s, pardon central bank’s annual report. Earlier today patience was rewarded when the SNB filed its 108th annual report, in which it disclosed that it spent CHF 86.1 billion or $88 billion, on current interventions last year, a measure of its efforts to shield the economy from deflation.
- This Is One Of The Most Important Silver Charts Of 2016!
On the heels of gold and silver continuing to consolidate their gains from the early part of 2016, analyst David P. out of Europe sent King World News an extremely important chart of silver, along with a brief commentary. The following long-term silver chart and commentary was sent to KWN by analyst David P. out of Europe: “The silver chart looks incredibly bullish. The buy signal on the MACD has confirmed the upward move and just look at the setup.”
- Desperate Chinese Investors Flood US, Canadian Housing Markets, But Real Numbers Are Taboo
Buying a home in the US or Canada has been an effective way for foreign residents to launder some money and get their wealth out of harm’s way. In the trophy markets on the US West Coast and in the Canadian cities of Vancouver and Toronto, rumors of a massive influx of Chinese money have swirled with growing intensity for years. The Chinese economic elite are worried about a devaluation of the yuan. They’re worried about getting rolled up by their own government. They’re worried about markets collapsing. They’re worried about pollution. They’re worried about a million things. They have one foot out the door. If push comes to shove, they’re ready to make the move. So capital flight from China has turned into a tsunami. And this money has to go somewhere.
- Oman Gas Projects Could Undermine U.S. LNG Market Ambitions
Two separate projects in the sultanate of Oman are about to turn the tiny Gulf country into an important international liquefied natural gas (LNG) player that the U.S. will have to contend with in its ambition to become the leader of this market. The first one is an agreement with Iran for the construction of a 400-kilometer pipeline that will transport Iranian natural gas to be liquefied at the three-train processing facility of Oman LNG.
- What Is Happening With GLD And Emerging Markets?
The following charts and commentary are from Jason Goepfert at SentimenTrader: ETF traders keep coming into gold. The GLD fund is seeing inflows even as the fund struggles to hold its gains.
- BERNANKE: Here are some of the exotic tools the Fed could use if we see another slowdown
Although the U.S. economy appears to be on a positive trajectory, history suggests that at some time in the next few years we may again face a slowdown, with a weakening job market and possibly declining inflation. Given that the historically low level of short-term interest rates is likely to limit the scope for conventional rate cuts, how would the Federal Reserve respond?
- Bank Earnings Get Mauled by “Leveraged Loan” Time Bomb
Banks have a few, let’s say, issues, among them: a source of big-fat investment banking fees is collapsing before their very eyes. S&P Capital IQ reported today that there was an improvement in the “distress ratio” of junk bonds, after nearly a year of brutal deterioration that had pushed it beyond where it had been right after Lehman’s bankruptcy. The recent surge in oil prices seems to have lifted all boats for a brief period. But not “leveraged loans.” Their distress ratio spiked to the highest levels since the Financial Crisis!
- “The Greatest Crash Of Your Life Is Just Ahead…” – Harry Dent Warns
Harry Dent, best-selling author and economist, has warned that the stock bubble in the U.S. today is the biggest in history and that the “greatest crash of your life is just ahead…” Writing on his website EconomyandMarkets.com, Dent warned that ‘The story on Wall Street and CNBC continues to be that we’re in a correction and this is a buying opportunity. Even Warren Buffett joins the chorus of stock market cheerleaders for the skeptical public. Well, I agree with the skeptical public, not the experts here! The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May.
- Keiser Report: Warnings from Confucius
In a double-Stacy episode, we look at the warnings from Confucius and Adam Smith. First, we look at the danger of those who think but do not learn; so ‘free trade’ deals are imposed because a ‘think tank’ believes it’s a great ideological idea but without looking at history to see what happens when wealth and hope are taken from an entire class of people. Then, in the second half, we look at the most important issue of 2016: creeping monopolization as oligopolies emerge in every major sector in America and across the world.
- Top Advisor To Largest Sovereign Wealth Funds Exposes Fed Manipulation And Intervention
Michael Belkin on the Fed’s interventions and manipulations: “I’m utterly convinced that the Federal Reserve manipulates the stock market. I experienced this firsthand when I worked at a government securities dealer, Solomon Brothers, which was one of the top three investment banks back in the 1980s and early 1990s. And in the 1987 stock market crash, they (the Federal Reserve) came in through us and intervened in the markets to make the markets bounce back. Everybody on the desk knew that. They (at Solomon’s trading desk) watched the (Solomon Brothers) Vice Chairman start bidding for multiple huge blocks of stock with money that we didn’t have. At that point the trading desk was paralyzed and nobody knew what was going on.
- This Oil Sector Hasn’t Crashed Yet… But It’s About to
Unlike the rest of the oil industry – which has been decimated by lower oil prices – U.S. oil refiners have marched on to new highs. But the five-year-long bull market for these companies is about to come crashing down. Let me explain… You can see the incredible uptrend in the following chart of refining giant Valero Energy (VLO). Its shares are trading near an all-time high…
- Oil Prices Fall Fast On Huge Inventory Build
Two hundred and twenty-two years after Josiah G. Pierson patented the rivet machine, and the oil market remains as riveting as ever. (I’m here all week, folks). After yesterday’s API report gave a flourishing hat-tip towards a large build to crude stocks and a large draw to gasoline, oil is sliding amid a stronger dollar, while gasoline is pushing higher. Here are some things to consider today: Jumping straight into economic data, the most insights we’ve had overnight have come from Brazil. Its mid-month inflation print dropped into single digits (at +9.95 percent), but still close to a 12-year high. Meanwhile, its unemployment rate jumped to 8.2 percent, its highest level in nearly 7 years.
- There has been ‘a perfect storm’ on Wall Street
By now it should come as no surprise that first-quarter results will be pretty horrendous for Wall Street. Banks will begin reporting Q1 earnings in mid-April, and a chorus including Morgan Stanley’s head of trading and the CEO of JPMorgan’s investment bank has warned that it will be unusually weak. The data-analytics firm Dealogic’s preliminary Q1 results for investment-banking fees show the worst first quarter since the dark post-financial-crisis days of 2009.
- Gold, Silver & The Final Currency War
Andy Hoffman from Miles Franklin is back to help document the global economic collapse for the third week of March, 2016. Thanks for tuning in. And despite the horrific “terror attack” in Belgium today, March 22, 2016 [Google: 322 Skull and Bones], I hope you all have a great week.
- Peter Schiff on gold, the Fed and the world’s addiction to stimulus
Peter Schiff is the CEO of Euro Pacific Capital Inc., and is an outspoken critic of the Fed’s stimulus and zero interest rate policies. He is the author of several New York Times bestsellers including Crash Proof, and most recently, The Real Crash.
- More Confessions of an Economic Hit Man: This Time, They’re Coming for Your Democracy
Twelve years ago, John Perkins published his book, Confessions of an Economic Hit Man, and it rapidly rose up The New York Times’ best-seller list. In it, Perkins describes his career convincing heads of state to adopt economic policies that impoverished their countries and undermined democratic institutions. These policies helped to enrich tiny, local elite groups while padding the pockets of U.S.-based transnational corporations.
- Japan Goes Full Krugman: Plans Un-Depositable, Non-Cash “Gift-Certificate” Money Drop To Young People
The Swiss, the Finns, and the Ontarians may get their ‘Universal Basic Income’ but the Japanese are about to turn the Spinal Tap amplifier of extreme monetary experimentation to 11. Sankei reports, with no sourcing, that the Japanese government plans to unleash “vouchers” or “gift certificates” to low-income young people to stimulate the “conspicuous decline” in consumption among young people. The handouts may not be deposited, thus combining helicopter money (inflationary) and fully electronic currency (implicit capital controls and tracking of spending).
- Durable-Goods Orders Weaken Amid Global Headwinds
A key measure of U.S. manufacturing health tipped back into decline last month, evidence that headwinds from weak global growth, low oil prices and financial volatility are weighing on company spending. New orders for durable goods—products designed to last at least three years, like dishwashers and aircraft—fell a seasonally adjusted 2.8% in February from a month earlier, the Commerce Department said Thursday.
- The Initial Jobless Claims Mystery Continues
Still hovering near 43 year lows, initial jobless claims printed a better than expected 265k against expectations of 269k. Continuing claims also dropped from 2.218m to 2.179m – also back near 43 year lows. So, the mystery is – why is the ISM’s composite manufacturing and services employment index collapsing to 6 year lows?
- The labor market just did something that hadn’t happened since the 1970s
Thursday’s initial jobless claims came in stronger than expected, with 265,000 claims versus expectations of 269,000. But the truly historic part of the report actually came three weeks ago. “Today’s release also includes revisions of both initial and continuing claims dating back to 2011,” Thomas Simons, senior economist at Jefferies, wrote. “Most of the changes were relatively modest, but the most notable aspect of the revisions is that claims for the week of March 5th (3 weeks ago) were revised down to 253,000 which is, as far as we can tell, the lowest weekly claims figure since November 24, 1973.”
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Latest News From March 18, 2016 to March 24, 2016:
- Connecticut Credit Risk Spikes To Record High
Amid cuts in aid and surging taxes, it appears the market remains less than impressed at Connecticut’s debt sustainability. Following last week’s disappointing bond auction, CT bond risk has spiked to 65bps over the benchmark – a record spread demanded by investors to take CT repayment risk. CT becomes the 4th riskiest US state after NJ, IL, and PA.
- Humans need not apply: RBS to replace 550 roles with robots
Royal Bank of Scotland (RBS) plans to replace 550 of its face-to-face investment advisers with so-called robo-advisers. 220 investment advice roles and 200 protection advice jobs will be cut while face-to-face investment advice will be available only to customers with at least £250,000 in investment assets.
- US Manufacturing PMI Misses By Most Since 2013, Presidential Election Blamed
Given the extraordinary jumps in several regional Fed surveys, hope was rife that US Manufacturing PMI’s flash print would jump… it didn’t. Hovering near multi-year lows at 51.4, PMI missed expectations of 51.9 by the most since Aug 2013. With record highs in wholesale inventories, Markit claims that “pre-production inventories decline at the steepest pace in over 2 years.” The blame for this plunge: dollar strength, weak global demand, and Trump. Not recovering…
- Americans just had $176 million in wages garnished by the government due to unpaid student loans
Despite more programs available to federal student loan borrowers to manage their loans, borrowers are still struggling. In fact, between October 1 and December 31, 2015, private debt collection companies hired by the Department of Education garnished more than $176 million in wages from defaulted student loan borrowers in order to pay back their debts, according to data released last week. Though the government provides a variety of options to help student loan borrowers manage their payments, it also has extraordinary powers — including wage garnishment — to collect on the debt if a borrower defaults.
- U.S. existing home sales tumble in warning sign for housing market
U.S. home resales fell sharply in February in a potentially troubling sign for America’s economy which has otherwise looked resilient to the global economic slowdown. The National Association of Realtors said on Monday existing home sales dropped 7.1 percent to an annual rate of 5.08 million units, the lowest level since November. Sales have been volatile and prone to big swings up and down in recent months following the introduction in October of new mortgage regulations, which are intended to help homebuyers understand their loan options and shop around for loans best suited to their financial circumstances.
- Fed’s Lacker says he is confident inflation will return to 2 percent
U.S. inflation is likely to accelerate in coming years and move toward the Federal Reserve’s 2 percent target, Richmond Fed President Jeffrey Lacker said on Monday, flagging upside risks to price growth. Inflation has been unusually sluggish since the 2007-2009 recession. The Fed has kept interest rates low in part to foster faster price gains and said last week it was likely to raise interest rates more slowly than policymakers had expected in December.
- Share Buybacks Turn Toxic
Companies are still borrowing and spending billions on buying back their own shares – one of the big drivers behind the blistering stock market rally of the past few years. It worked wonderfully and without fail. But suddenly, it’s doing the opposite, and now the shares of the biggest buyback queens are getting hammered. Something broke in the gears of this financially engineered market! During the November-January period, 378 of the S&P 500 companies bought back their own shares, according to FactSet. Total buybacks in the quarter rose 5.2% from a year ago, to $136.6 billion. Over the trailing 12 months (TTM), buybacks totaled $568.9 billion. That’s an enormous amount of corporate cash that was dumped on the market!
- It’s Day 26 Of The Rally – Decision Time
In September/October 2015, the S&P 500 miraculously rallied just over 13% in 25 days amid falling earnings expectations, before collapsing back to fresh cycle lows. It has now been 25 days (and just over 13%) since the Mid-Feb lows (and earnings expectations are plumbing new lows)… The same but different?
- Rich people are paying lawyers to get truthful stories deleted from the internet
Last week, Bloomberg, The Independent, Business Insider and a handful of other news organisations all deleted from their websites a story that a rich family did not want published. I can’t tell you why it was deleted or who the story was about, because of a court order from a judge in London ruling that the facts be kept under seal.
- January ‘Bounce’ Dies As Fed’s National Activity Index Tumbles Back Into Contraction Near 2-Year Lows
After January’s hopeful spike to 6 month highs, Chicago Fed’s National Activity Index plunged back into contraction (at -0.29) near 2 year lows. A shockingly large 58 of the 85 individual indiators within the index made negative contributions to the overall index which printed notably below the lowest economist’s expectations.
- Nanobot implants could give us ‘God-like’ intelligence, but machines won’t overtake us until they learn to love, scientist claims
The human brain could be enhanced by tiny robotic implants that connect to cloud-based computer networks to give us ‘God-like’ abilities, according to a leading computer scientist. Ray Kurzweil, an author and inventor who describes himself as a futurist who works on Google’s machine learning project, said such technology could be the next step in human evolution. He predicts that by the 2030s, humans will be using nanobots capable of tapping into our neocortex and connecting us directly to the world around us. However, he admitted that computers won’t take over us until they learn to love and laugh.
- Existing home sales plunge 7.1% to a 3-month low in February
Existing-home sales plummeted 7.1% in February, pointing to ongoing rockiness in a housing market struggling to find its footing. Sales ran at a seasonally adjusted annual rate of 5.08 million, the National Association of Realtors said Monday, well below the 5.3 million rate forecast by economists surveyed by MarketWatch. February’s decline followed a strong two months. Sales surged by the most ever in December, and followed with a sturdy reading in January when most economists had expected some giveback.
- Federal Reserve Hot Air Pumped Up a Stock Market Bubble; 93% of Gains Due to Monetary Policy
The mainstream financial media is like a stopped clock. Every once in a while, it stumbles into being right. Last week, we had a veteran trader on CNBC Futures Now telling everybody to buy gold as long as central banks continue their expansionary monetary policy, all the while swearing he isn’t a “gold-bug.”
- Legend Warns The Price Of Silver May Hit $660 As The World Financial System Melts Down
On the heels of wild start to the 2016 trading year, today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events, just warned that the price of silver may be headed to the stratospheric price of $660 as the world financial system melts down. Egon von Greyerz: “The Fed last Wednesday did what I had already forecast back in December and did not increase rates. They know that the real economic situation in the US and in the world is a lot worse than all the manipulated figures and propaganda. Therefore, we are now getting closer to Minsky Moment for the world economy…
- Gerald Celente On Why People Are Buying Gold And Why The Price Is Headed Higher
Today the top trends forecaster in the world spoke with King World News about why the price of gold is going higher. Gerald Celente: “Why are people going into gold and why are gold prices going up? Listen to what former Fed president Richard Fischer said, ‘They (the central banks) are running out of ammunition.’ He also said, ‘We injected cocaine and heroin into the system,’ to basically keep the Ponzi scheme going. So why are people buying gold? Because it (the entire global financial system) is on a fake high. So that’s why gold is going up — it’s a fraudulent game. It’s not working. It’s a fake high. That’s why people are buying gold…
- Radical Leftists Unleash Anti-Trump Riots Starting On March 19th
Many of the exact same groups that participated in Occupy Wall Street and helped organize protest rallies in Ferguson and Baltimore are now promising to bring us “the largest civil disobedience actions in a generation”. I recently wrote about the trouble that radical leftists have caused by attempting to disrupt Trump campaign events, but now there is a very organized effort to turn this into a national movement. On March 19th, thousands of angry protesters will descend on Trump Tower in New York City to denounce Donald Trump’s “fascist policies”, and on April 2nd dozens of leftist organizations will join together to launch “Democracy Spring” in Philadelphia. From there, large numbers of liberal activists will march to Washington D.C. where they will “risk arrest” during a “peaceful” sit-in at the U.S. Capitol from April 11th to April 18th. If the radical left is this freaked out about Donald Trump now, how bad will things get if he actually becomes the Republican nominee?
- Why Investing In Silver Is Vastly Superior To Investing In Gold Right Now
When panic and fear dominate financial markets, gold and silver both tend to rapidly rise in price. We witnessed this during the last financial crisis, and it is starting to happen again. Because I am the publisher of a website called The Economic Collapse Blog, I am often asked about gold and silver when I do interviews. In fact, just a few days ago I was sitting right next to Jim Rickards during the taping of a television show when this topic came up. Jim expressed his belief that investing in gold is superior to investing in silver, but I had the exact opposite viewpoint. In this article, I would like to elaborate on why I believe that silver represents a historic investment opportunity right now.
- Catalonia Nears Default, Threatens Spain’s Debt
When Catalonia’s regional government announced a road map to independence from Spain in November last year, Madrid’s response was to threaten to cut off the financial supply lines to the region. It was the equivalent of a declaration of economic war, riddled with risks, especially with an acutely cash-strapped Catalonia facing over €4.6 billion of bond redemptions in 2016.
- China Hard Landing Hits Electricity Consumption
OK, we’ve heard the official story. China is transitioning from a manufacturing economy to a consumption-based economy. Consumers are king. They’re going to buy stuff. And that’s going to heat up the economy. Imports and exports have been plunging for months, but no big deal, Chinese consumers – and there are a lot of them – are going to pull the economy forward. That’s the official story.
- A Strange Pattern Emerges When Trading The US Dollar In 2016
One of the more surprising market developments of 2016 has been the violent obliteration of those who had taken part in the biggest consensus trade of 2015, namely long the USD. As the Fed finally admitted earlier this week, the US economy is sputtering and is woefully incapable of handling 4 rate hikes, or 3 for that matter. In fact, the Fed will be lucky to push through even one more rate hike without the Chinese Yuan collapsing and unleashing even more capital outflows (which precipitated the major market swoons in the summer of 2015 and early 2016) arguably the main topic during the alleged Shanghai G-20 “central bank accord.” The result: this week saw the biggest two-day USD collapse against a basked of foreign currencies in years, and currently the DXY is trading at a lower level than a year ago.
- January Mortgage Delinquencies up 6.6%; 98,000 Bad Mortgages Face Statute of Limitations in 3 States
The Mortgage Monitor for January (pdf) from Black Knight Financial Services (BKFS, formerly LPS) reported that there were 659,237 home mortgages, or 1.30% of all mortgages outstanding, remaining in the foreclosure process at the end of January. This was down from 688,672, or 1.37% of all active loans that were in foreclosure at the end of December, and down from 1.76% of all mortgages that were in foreclosure in January of last year. These are homeowners who had a foreclosure notice served but whose homes had not yet been seized, and the January “foreclosure inventory” is now showing the lowest percentage of homes that were in the foreclosure process since the fall of 2007. New foreclosure starts, which have been volatile from month to month, fell to 71,900 in January from 78,088 in December and from 93,280 in January a year ago, while they were still higher than the 66,626 foreclosure starts we saw in November, which had been the lowest since the crisis began. Over the past year, new foreclosure starts have remained in a range about one-third higher than number of new foreclosures we we seeing in the precrisis year of 2005.
- “Don’t Take The Public For Fools!”: China Hides Millions Of Layoffs, Jails Miners Protesting Unpaid Wages
When you look out across markets and across the increasingly fraught geopolitical landscape, there are plenty of black swans waiting in the wings (no pun intended). And quite a few of them are Chinese. China has, among other problems: a massive debt overhang that, all told, amounts to more than 250% of GDP; a decelerating economy that Beijing swears will be able to pull off a miracle and move away from the smokestack and away from export-led growth without slipping into recession; a currency crisis; a new property bubble in Tier-1 cities; and a burgeoning NPL problem in the banking sector. All of those issues are of course inextricably bound up with one another. They are set like dominoes and once the first one tips, the rest will too as sure as night follows day.
- Life and Times During the Great Depression
The economy of the United States was destroyed almost overnight. More than 5,000 banks collapsed, and there were 12 million people out of work in America as factories, banks, and other shops closed. Many reasons have been supplied by the different economic camps for the cause of the Great Depression, which we reviewed in the first part of this series. Regardless of the causes, the combination of deflationary pressures and a collapsing economy created one of the most desperate and miserable eras of American history. The resulting aftermath was so bad, that almost every future Central Bank policy would be designed primarily to combat such deflation.
- Goldman FX Head: “No Central Bank Conspiracy” To Crush The Dollar, “We Are Right, The Market Is Wrong”
Anyone having listened, and traded according to the recommendations of Goldman chief FX strategist Robin Brooks in the past 4 months, is most likely broke. First it was his call to go very short the EURUSD ahead of the December ECB meeting, which however led to the biggest EURUSD surge since the announcement of QE1. Then, two weeks ago, ahead of the ECB meeting he “doubled down” on calls to short the EUR ahead of the ECB, the result again was a EUR super surge, the biggest since December. And then, as we previously reported, ahead of the FOMC’s uber-dovish meeting, Brooks released a note titled the “The Dollar Rally Is Far From Over” in which he said the following: “today brings the latest FOMC meeting. We expect the Fed to signal that it wants to continue normalizing policy, which means three hikes this year and four in 2017, with the statement referring to the risks as “nearly balanced,” reverting to phraseology used in October, just before December lift-off. Overall, our sense is that the outcome will be more hawkish than market pricing, in particular given that the FOMC may leave open the option of tightening at the April meeting.”
- US Money Supply and Debt – Early Warning Signs Remain Operative
Year-end distortions have begun to slowly come out of the data, and while broad true US money supply growth remains fairly brisk, it has begun to slow again relative to January’s y/y growth rate, to 7.8% from 8.32%. So far it remains in the sideways channel (indicated by the blue lines below) between approx. 7.4% and 8.6%, in which it has meandered since mid 2013. We believe the next break “below the shelf” is likely to be a significant event.
- The World Map of the U.S. Trade Deficit
The United States has now run an annual trade deficit for 40 years in a row. Last year was no exception, and in 2015 the U.S. had over $1.5 trillion in exports while importing $2.2 trillion of goods. The resulting trade deficit was -$735 billion. Today’s map from HowMuch.net, a cost information site, helps put this most recent information into perspective. Keep in mind that a trade deficit also means an outflow of domestic currency to foreign markets, as the U.S. is spending more money abroad than it is bringing in.
- The Lego Movie Economy
After the February jobs report, President Obama said “America’s pretty darn great right now.” He then went on to disparage the “doomsday rhetoric” of the Republicans, which he said was pure “fantasy. I think that there is a good chance that this will enter the Hall of Fame of miss-timed statements, right up there with this jewel from Ben Bernanke in March 2007: “At this juncture, however, the impact on the broader economy and financial markets of the problems in the sub-prime market seems likely to be contained.”
- Munich Re Gives The ECB The Middle Finger, Owns Almost 300,000 Ounces Of Gold
Last week, we reported on the ECB’s decision to cut the interest rates and how Mario Draghi said ‘helicopter money’ is ‘an interesting concept that is being studied’. In the accompanying Q&A session, Draghi also said he did not expect the ECB would have to reduce the (already negative) interest rates even further which disappointed the markets. In fact, the disappointment was so big, the ECB already sent one of its members into the trenches to walk back on that statement.
- Investors Buy Gold ETFs at Record Pace
What were the three most popular investments over the last month? If we’re judging by ETF inflows, the three areas that investors piled into were precious metals, government bonds, and low-volatility equities. Notably, it was gold ETFs that set a new record with their highest monthly inflows in eight years, as investors bought $7.9 billion of securities in February. This is according to the latest from market data company Markit, that also noted that inflows relative to assets under management (AUM) were equally as impressive. More specifically, last month’s buying represented an increase of 14.6% in terms of AUM. This is a level only surpassed once before during the heat of the Financial Crisis, when inflows relative to AUM hit 17.7% in February 2009.
- World’s Second Largest Reinsurer Buys Gold, Hoards Cash To Counter Negative Interest Rates
The world’s second-largest reinsurer, German Munich Re which is roughly twice the size of Berkshire Hathaway Re, is boosting its gold reserves and buying gold in the face of the punishing negative interest rates from the European Central Bank, it announced today. As caught by Mark O’Byrne at GoldCore and reported by Thomson Reuters this afternoon, the world’s largest reinsurer is far from alone in seeking alternative investment strategies to counter the near-zero or negative interest rates that reduce the income insurers require to pay out on policies. Munich Re has held gold in its coffers for some time and recently added a cash sum in the two-digit million euros, Chief Executive Nikolaus von Bomhard told a news conference.
- Your Money In The Bank Will Be Gone
The world is now starting the final phase of the failed experiment in creating wealth and prosperity for a select few and massive debt and misery for the masses. It all started with the creation of the Fed in 1913. This led to a global credit creation and money printing extravaganza of a magnitude that the world has never seen before. We have now reached the point when it makes no difference who becomes US president or what the Fed or the IMF will do. No, now we are at the point that von Mises so succinctly defined.
- 12 Obamacare Insurance CO-OPs Fold After Getting $1.2 Bil from Govt.
More than half of the government-funded nonprofit health insurers created by Obamacare have failed, sticking taxpayers with a $1.2 billion tab and leaving hundreds of thousands of people in more than a dozen states scrambling for medical coverage, a new federal audit reveals. The nonprofit insurers are known as Consumer Operated and Oriented Plan Program (CO-OP) and the Department of Health and Human Services (HHS) has pumped $2.4 billion into them under the president’s hostile takeover of the nation’s healthcare system.
- Is coercion ever justified?
Last week’s editorial asked the question: Can the Constitution be improved? We said that the American Constitution represented an new concept in history. It declared that the sovereign power of the state rightfully is derived from the people instead of the divine right of kings. We concluded that it was an amazingly successful beta model but that it was not perfect, because it contained undefined phrases, such as “the general welfare” clause, that left holes through which political predators eventually were able to enter and undermine original intent.
- The Internet Of Things Will Be The World’s Biggest Robot
The Internet of Things is the name given to the computerization of everything in our lives. Already you can buy Internet-enabled thermostats, light bulbs, refrigerators, and cars. Soon everything will be on the Internet: the things we own, the things we interact with in public, autonomous things that interact with each other. These “things” will have two separate parts. One part will be sensors that collect data about us and our environment. Already our smartphones know our location and, with their onboard accelerometers, track our movements. Things like our thermostats and light bulbs will know who is in the room. Internet-enabled street and highway sensors will know how many people are out and about—and eventually who they are. Sensors will collect environmental data from all over the world.
- Smartphones to replace cards at bank machines
Here’s another use for the smartphone as it invades daily life: in place of your debit card at your bank cash machine. The “cardless” automatic teller machine (ATM) is gaining ground in the US and around the world, with smartphone technology allowing for speedier and more secure transactions. Dozens of US banks are installing new ATMs or updating existing ones to allow customers to order cash on a mobile application and then scan a code to get their money without having to insert a bank card. US banking giants Wells Fargo, Bank of America and Chase are in the process of deploying the new ATMs, as are a number of regional banks and financial groups around the world. Makers of ATMs and financial software groups are ramping up to meet this demand.
- The New New ‘Deal’ – “Markets Are Too Important To Be Left To Investors”
Our story so far… In the second half of 2014, export volumes in every major economy on Earth began to decline, the result of divergent monetary policies that crystallized with the Fed’s announced tightening bias in the summer of 2014. This decline in trade activity – which is far more impactful than a decline in trade value, because it means that the global growth pie is structurally shrinking – accelerated in 2015 and 2016 as Europe and Japan intentionally devalued their currencies to protect their slices of the global trade pie. In game theoretic terms, Europe and Japan have been “free riders” on the global system, using currency devaluation to undercut the prices of competing US and Chinese products in a way that avoids domestic political pain.
- Oil output rises even as US rig count falls to historic lows
The number of oil and gas drilling rigs in the US has fallen to the lowest level since data started being collected, although production remains near record highs. The number of rigs drilling in the US now stands at 94, three down on last week and the lowest rig count since the energy consultancy Baker Hughes starting tracking the figures back in 1948. The rig count has dropped by 63 per cent over the past year and is almost 90 per cent lower than peak levels five years ago when oil was in excess of $US110 a barrel.
- Even Mainstream Economists Starting to Admit that “Free Trade Agreements” Are Anything But …
Trump and Sanders have whipped up a lot of popular support by opposing “free trade” agreements. But it’s not just politics and populism … mainstream experts are starting to reconsider their blind adherence to the dogma that more globalization and bigger free trade agreement are always good.
- Trump is completely wrong about the U.S. trade deficit
Thomas Sowell once explained that economists visit the dentist so often because we gnash our teeth hearing so much “ignorant nonsense about the economy.” Thanks to the gibberish spewed almost daily about international trade, dentists must be having an especially busy year. Virtually all economists support free trade and oppose protectionism. For example, a 2014 University of Chicago survey found that 93% of the country’s top economists agreed with the statement “Past major trade deals have benefited most Americans” and none disagreed (7% were uncertain).
- The world’s second biggest coal miner could be about to go bankrupt
Peabody Energy, one of the world’s biggest producers of coal, has warned that it is at risk of going bankrupt in the very near future, thanks to a lack of “sufficient liquidity to sustain operations and to continue as a going concern” caused largely by the continuing downturn in the coal mining industry. In a regulatory filing on Wednesday, the US-based producer said: “There can be no assurance that our plan to improve our operating performance and financial position will be successful.” Peabody has undertaken a huge programme of cost-cutting in recent years to stave off a massive crash in the price of the commodity.
- Richard Russell – The Key To The Bull Market In Gold & The Bear Market In Global Stock Markets
Late last year, Richard Russell gave us the key to the bull market in gold and the bear market in global stock markets. This is the second in a series of releases KWN will be publishing on the wisdom passed down from the Godfather of newsletter writers. From legendary Richard Russell: “I want to start this site off with a bow to Fred Hickey, who puts out The High Tech Strategist. Hickey is a prodigious worker and reads everything. Fred is a true believer in gold and I read his work carefully. Americans are scared to death and befuddled by the news of the day. They are well aware that their own lives and jobs have little to do with the nonsense that the Fed and the government is shoveling out to them.
- Peter Boockvar – Fed Suspends Reality As The Rush To Gold Continues
On the heels of the Fed’s decision not to raise rates, today Peter Boockvar sent King World News a fantastic piece discussing the Fed’s decision and the subsequent surge in the gold market. Peter Boockvar: For the past few years the Fed has been chipping away at the concept that they are driving monetary policy dependent on the data that they see. We know that because they kept changing the rules of the game in that every time a goal was reached the goal was altered. Well, I believe it is safe to say that after yesterday’s FOMC statement, the Yellen press conference and what was said in them, the communication and structural strategy of ‘data dependency’ has been officially neutered. The Fed’s goal is now a perfect world. As we of course will never get there, the rest of us are left flying blind as to what to expect from monetary policy…
- Why Global Debt Growth May Extend The Oil Glut
In this post I present some selected parameters I monitor which may help understand near term (2-3 years) oil price movements and levels. It has been my understanding for some time that the formulations of fiscal and monetary policies affect the commodities markets. Changes to total global debt has and will continue to affect consumers’/societies’ affordability and thus also the price formation of oil.
- Political Turmoil Rages in Brazil, Puts Oil Industry On Edge
More than 3 million people protested in the streets of major cities across Brazil on March 13, numbers that may have exceeded even the massive rallies that took place at the end of the country’s military dictatorship in the mid-1980s. The population is fed up with corruption, fed up with the ruling party, and are seeking the ouster of President Dilma Rousseff.
- The Terrible Oil News Nobody Noticed
A terrible bit of news went unnoticed in the commotion amid the rebound in oil prices over the past two weeks. While every news outlet shouted about Iran and OPEC, a U.S. energy icon quietly announced news that could potentially shatter the industry. As I’ve explained recently, many oil companies are teetering on the brink of bankruptcy. But news out of Alaska could lead to disaster. BP Prudhoe Bay Royalty Trust (BPT) – operated by the Alaskan division of oil giant British Petroleum (BP) – sells oil from the Prudhoe Bay oilfield.
- The Wisdom Of Jesse Livermore As Gold And Silver Surge Strongly After Fed Decision
On the heels of the Fed’s decision not to raise rates, gold soared more than $30 and silver surged as well, and the U.S. dollar tumbled. But even with the recent positive action in the gold and silver markets, what some of the gold and silver community are struggling with at this point is exercising patience. Some have been selling positions and moving to the sidelines, waiting for the next shoe to drop. While there will be pullbacks, KWN readers around the world need to understand that you don’t want to give up your position at the beginning of a new bull market…
- And this is When the Jobs “Recovery” Goes Kaboom
The future for employment looks bright. The gig economy is firing on all cylinders. The FOMC, in its statement concerning its interest rate decision today, was practically gleeful about employment and where it’s headed: A range of recent indicators, including strong job gains, points to additional strengthening of the labor market. The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will continue to strengthen.
- Fleckenstein – Silver May Be About To Scream Higher As People Lose Confidence In Idiot Central Bankers
With many people wondering what’s next for the markets, today Bill Fleckenstein warned silver may be about to scream higher as people lose confidence in idiot central bankers. Despite the Fed’s dovishness, overnight markets were mostly lower, though that did not seem to matter too much to the SPOOs or trading here, as the indices were not very far from unchanged through midday, with the Dow and the S&P slightly higher and the Nasdaq a touch lower. In the afternoon they all marched higher still. By day’s end the Dow/S&P gained about 0.75% (with the Nasdaq just up fractionally despite decent strength in lots of speculative names, especially chips)…
- WTI Crude Slides Back Into Red For 2016 As The Fed And Oil Remain On Unsustainable Paths
Oil prices have increased 50 percent since the lows exhibited earlier this year, a rise that is largely linked to the positive market reaction to the OPEC output freeze. But WTI Crude has given up all its early morning “see oil is fixed” gains in a hurry as once again the algo ramps give way to the realization that, as OilPrice’s Leonard Brecken notes, comes even as for all intents and purposes OPEC has nearly reached its production limits and Iran still plans in increasing output.
- The Stunning Size Of China’s Housing Bubble In One Chart
Over the past month we have documented the surreal reemergence of China’s latest housing bubble (recall the first one burst in early 2014 which forced Beijing to reflate the stock market bubble, which also burst over a year later). But nothing does China’s housing bubble justice quite like a simple chart showing what is going on right now with home prices in Shenzhen, which incidentally also puts the housing bubble in the context of China’s recently burst stock market bubble. No comment necessary.
- ALERT: Gerald Celente Issues Trend Forecast On Gold And The Fed
The top trends forecaster in the world just announced a trend alert for gold and the Fed! He also discusses the unprecedented moves by central banks. Gerald Celente – Once upon a time, in a pre-smartphone and Facebook Age, workers of the world with a little extra cash did what the millennial generation would never dream of and probably never heard of. They’d deposit their money in savings accounts or buy certificates of deposit…
- Caterpillar cuts Q1 earnings, revenue guidance
Caterpillar on Thursday cut its first-quarter earnings and revenue guidance, but said it remains comfortable with its prior full-year forecast. Shares of Caterpillar fell more than 3 percent in premarket trading on the news. (Get the latest quote here.) The world’s largest construction and mining equipment maker’s giant said it expects quarterly adjusted earnings of 65 cents to 70 cents a share, sharply lower than Street expectations of 97 cents a share. Revenue was forecast at $9.3 billion to 9.4 billion for the quarter, below expectations of $10.4 billion.
- U.S. current account deficit narrows in fourth quarter
The U.S. current account deficit narrowed in the fourth quarter, but the improvement is unlikely to be sustained as a strong dollar continues to undercut exports of goods. The Commerce Department said on Thursday the current account deficit, which measures the flow of goods, services and investments into and out of the country, fell 3.6 percent to $125.3 billion. The third-quarter deficit was revised up to $129.9 billion from $124.1 billion. Economists polled by Reuters had forecast the current account deficit falling to $118.9 billion in the fourth quarter. For 2015, it totaled $484.1 billion, the largest since 2008.
- Is This Why Yellen Went Full-Dove: U.S. Hiring Plunges Most Since November 2008
While the BLS’ JOLTs report usually gets a B-grade in terms of importance due to its one-month delayed look back (we just got the January report which is one month behind the most recent payrolls number) it serves an important function due to its breakdown of various labor components such a job openings, new hires, separations, quits and terminations, all of which make up Janet Yellen’s “labor dashboard.” In fact, according to Yellen herself, the JOLTs data is as important, if not more so, than the BLS report. Which may explain why yesterday the Fed surprised as dovishly as it did. As a reminder, the key number most look for in the monthly JOLTs report is the number of Job Openings: for January the BLS reported a print of 5,541K, which modestly beat the expected 5,500K consensus number.
- Luxury jeweler Tiffany’s profit beats estimates as costs fall
Upscale jeweler Tiffany & Co (TIF.N) reported a better-than-expected profit for the holiday quarter as it raised prices and benefited from lower prices of diamonds, gold and silver. Shares of the company, which became a household name due to the 1961 Hollywood classic “Breakfast at Tiffany’s”, rose as much as 4 percent in morning trading on Friday. Weakness in the global economy and a strong dollar have hurt Tiffany and other luxury retailers such as Nordstrom Inc (JWN.N), Neiman Marcus Group and Macy’s Inc-owned (M.N) Bloomingdale’s as tourists shy away from buying high-end items.
- Consumer Sentiment Index Falls For Third Straight Month
Consumer sentiment unexpectedly fell for a third straight month in March, according to the latest University of Michigan survey, as Americans suspect that the era of cheap gas is ending. That’s a bad sign for consumer spending from Apple (AAPL) iPhones to Tiffany (TIF) jewelry. The Michigan sentiment index’s flash reading was 90, down 1.7 points from the February’s final reading of 91.7, January’s 92 and December’s 92.6. It’s the lowest reading since October. Wall Street expected a flash March reading on 92.2. The index hit 95.9 in April, the highest since January 2007, but quickly retreated to 87.2 in September.
- The Economic Recovery: A Myth Built Upon a Myth
No matter how much data you point to showing the health of the US economy isn’t as good as advertised, you will inevitably hear the refrain, “But look at the jobs numbers!” Just the other day, Peter Schiff appeared on Fox Business and said the US economy is likely already in recession. Peter repeated his prediction that the Fed wasn’t going to raise rates again, but would instead drop them to zero. National Alliance Securities Global strategist Andy Brenner was having none of that. He insisted the Fed would raise rates at least two more times this year because the economy is doing OK. And what was his proof? You guessed it – jobs! Peter made mincemeat out of Brenner’s argument, pointing out that most of the new jobs in the February report were part-time and low paying.
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Latest News From March 11, 2016 to March 17, 2016:
- Record Swings of Deflation and Inflation Coming-Michael Pento
Money manager Michael Pento says the Fed and other global central banks are “not going to stop manipulating the markets.” Pento explains, “There is no escape from the manipulation by central banks and manipulation of asset prices. There is no escape of manipulation of interest rates, of money supply growth, of stock values and of bond prices. They can never stop. . . . Just a hint that this massive manipulation of all markets and asset classes might end someday sends them crashing. So, there is no escape in Japan, China, Europe and the United States. That means we are headed for massive bouts of wild swings between inflation and deflation, the likes of which we have never before seen in the history of economics.”
- This Chart Shows the First Big Crash Is Likely Just Ahead
The story on Wall Street and CNBC continues to be that we’re in a correction and this is a buying opportunity. Even Warren Buffett joins the chorus of stock market cheerleaders for the skeptical public. Well, I agree with the skeptical public, not the experts here! The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May.
- What’s in Store for the Real Economy
The Census Bureau announced today that total business sales in January did what they’d been doing relentlessly for the past one-and-a-half years: they fell! This time by 1.1% from a year ago, to $1.296 trillion, and by 5% from their peak in July 2014. They’re now back where they’d been in January 2013. Sales are adjusted for seasonal and trading-day differences, but not for price changes. And since January 2013, the consumer price index rose 2.8%! This is why the US economy has looked so crummy. That’s bad enough. But it gets much worse.
- U.S. Consumer Prices Fell in February
U.S. consumer prices fell in February due largely to a slide in gasoline prices, but other evidence pointed to steadily building inflation pressures that could reassure the Federal Reserve as it considers raising short-term interest rates. The consumer-price index, a gauge of what Americans pay for everything from refrigerators to dental care, declined 0.2% over the month, the Labor Department said Wednesday. Overall prices haven’t risen since November and are up just 1% over the past year.
- U.S. industrial output resumes downturn in February
After hopeful signs of stabilization in January, industrial production decreased 0.5% in February, according to data released by the Federal Reserve on Wednesday. Economists polled by MarketWatch had expected a 0.6% fall in industrial output for February. The Fed revised January’s strong gain in output to 0.8%, down a tad from the 0.9% gain initially estimated. Many analysts said the details were not as disappointing as the headline.
- US Recession Data Signals It’s A Very Short Road To Capital Controls
“Prosperity is like a Jenga tower. Take one piece out and the whole thing can fall.” That’s a direct quote from John Williams, the President of the San Francisco Federal Reserve Bank in a speech he gave a few weeks ago. He could have just as easily been talking about propaganda. The Fed, the White House, Wall Street, the media have a vested interest in peddling a certain narrative about the economy. The narrative goes something like this: “Everything’s awesome. Stop asking questions”. But if you look at their own data, the numbers tell a different story.
- China Freight Index Collapses To Fresh Record Low
The Baltic Dry Index has risen for the last few weeks, buoyed by hopes (a la Iron Ore) of a National People’s Congress stimulus surge from China. While the scale of the ‘bounce’ is negligible in real terms compared to the total collapse, it has caused such momentum-muppets as Jim Cramer to proclaim China ‘fixed’ and investible. So we have one quick question – if everything is awesome, why did the China Containerized Freight Index just crash to new record lows? It appears BDIY gets over-excited relative to CCFI…
- US Government Blames 9/11 On Iran, Fines Iran $10.5 Billion; Iran Refuses To Pay
On March 14th, Iran announced that it will never pay the $10.5B that a U.S. court demanded it pay for the 9/11 attacks. The same Bill-Clinton-appointed judge who had ruled, on 29 September 2015, that Saudi Arabia has sovereign immunity for 9/11 and so can’t be sued for it, ruled recently, on March 9th that Iran doesn’t have sovereign immunity and fined Iran $10.5 billion to be paid to 9/11 victims and insurers; but, on March 14, Iran’s Foreign Ministry said Iran won’t pay, because, as the Ministry’s spokesman Hossein Jaberi Ansari put it, “The ruling is ludicrous and absurd to the point that it makes a mockery of the principle of justice while [it] further tarnishes the US judiciary’s reputation.”
- RBS to cut almost 450 investment banking jobs in UK
Royal Bank of Scotland is cutting 448 investment banking jobs in the UK, moving two-thirds of them to India. The bank, 73% of which is owned by the taxpayer, said it would cut back- and middle-office roles in its investment bank, including a small number of technology jobs. Under its chief executive, Ross McEwan, RBS has been shrinking the division to focus on its personal and small business operations in the UK and Ireland.
- US retail sales dip in Feb.; Barclays slashes GDP view
U.S. retail sales fell less than expected in February, but a sharp downward revision to January’s sales could reignite concerns about the economy’s growth prospects. The Commerce Department said on Tuesday retail sales dipped 0.1 percent last month as automobile purchases slowed and cheaper gasoline undercut receipts at service stations.
- Japanese Gold Buying Spree Confirms Negative Interest Rates Good for Gold
Over the last several weeks, we’ve been building the case that negative interest rates are good for gold, and mainstream analysts have echoed our thoughts. Last week, Britain’s largest bank, HSBC, issued a statement saying the longer the world’s central banks continue to experiment with negative interest rates, the better the outlook for gold.
- US Business Inventory-Sales Ratio Jumps To Post-Crisis (7 Year) High
Following the recessionary surge in Wholesale Inventories-to-Sales ratio, this morning’s Total Business inventories-to-sales rose to 1.40x – the highest since May 2009. With a 0.4% slump in sales and 0.1% rise in inventories, the smell of recession lays heavy on US businesses… but then again – who cares if Draghi can keep buying ‘assets’ and saving the world?
- Unpaid subprime car loans hit 20-year high
Americans with lower credit scores are falling behind on auto payments at an alarming pace. The rate of seriously delinquent subprime car loans soared above 5% in February, according to Fitch Ratings. That’s worse than during the Great Recession and the highest level since 1996. It’s a surprising development given the relative health of the overall economy. Fitch blames it on a dramatic rise in loans with lax borrowing standards that have helped fuel the recent boom in auto sales. More Americans bought new cars last year than ever before and the amount of auto loans soared beyond $1 trillion.
- Ackman takes $1B hit as Valeant tumbles 49%
Somebody give Bill Ackman an aspirin. Better make it a double. The embattled hedge fund mogul saw the value of his investment in Valeant Pharmaceuticals fall by $766 million on Tuesday after shares of the troubled company fell by 51 percent in the wake of three troubling disclosures.
- Gold Falls as Investors Lock in Gains Ahead of Fed Meeting
Gold prices fell Monday, as investors locked in gains on the precious metal ahead of this week’s Federal Reserve meeting. Gold for May delivery closed down 1.1% at $1,245.10 a troy ounce on the Comex division of the New York Mercantile Exchange.
- The Cashless Society – Keynesian “Stability” Vs Trumpian Turmoil
In this article, Claudio Grass, Managing Director at Global Gold Switzerland, talks to economist and Mises Institute Senior Fellow Thomas DiLorenzo. This exclusive interview covers central bank monetary policies, Keynesian economics, the economic“recovery,“ political correctness, and much more.
- The Liquidity Endgame Begins: Whiting’s Revolver Cut By $1.2 Billion As Banks Start Slashing Credit Lines
Earlier today we reminded readers about the circular (and why note fraudulent conveyance) scheme hatched by JPMorgan to reduce its secured loan exposure to Weatherford, when just two weeks ago none other than JPM underwrote an WFT equity offering in which it sold equity in the company, and which proceeds were promptly used by the company to repay the JPMorgan revolver. We then showed that it wasn’t just Weatherford: most of the “uses of funds” from the recent record surge in oil and gas equity offerings, have been used to repay the secured debt/revolver facilities, thereby eliminating funded and unfunded balance sheet exposure of major US banks.
- Having Killed Their Equity Market, China Unleashes “Tobin Tax” For FX Market
In September last year, Chinese regulators stepped on the throat of a ‘fair’ market in equity futures trading and for all intent and purpose killed the Chinese equity market. Tonight – after 2 days of Yuan weakness – having warned everyon from Soros to Kyle Bass that “betting against the Yuan can’t possibly work,” The PBOC just unleashed plans for so-called “Tobin Tax” on FX transactions (which implicitly taxes each transaction, reducing liquidity, raising margins and reducing leverage). Deputy central bank governor Yi Gang raised the possibility of implementing a Tobin tax late last year in an article written for China Finance magazine, and now, as Bloomberg reports, it is on!
- Trump is a Picky Eater Who Sleeps 3 Hours a Night and Hates Sloppy Dressers, His Ex-Butler Says
What is it like serving at Donald Trump’s beck and call? The billionaire’s former butler Tony Senecal has much to tell — like when a young Mr. Trump and first wife Ivana, had four butlers waiting on them hand and foot. Senecal, who served Trump for almost 20 years, told IE: “After Mr. Trump and Ivana got a divorce, we were going over to his room one night and he said: ‘Tony, do I need four butlers?’ and I said: ‘As long as it’s me Mr. Trump you only need one.’ He got rid of the other three.” Senecal describes Trump as a man always on the move and rarely relaxes. “I’m going into the room to clean it after he’s gone and he’s re-arranged the closet. And the clothes are all on the floor that he wants to get rid of,” he said. The former butler said that Trump is always busy because he is “always thinking.”
- “It’s The Q2 2015 Rally All Over Again” – Morgan Stanley Warns Big Oil Drop Imminent Due To “Rampant Hedging”
One week ago, the market was disappointed when Goldman’s head commodity strategist, Jeffrey Currie pointed out the obvious, namely that the higher the price of oil rises, the greater the probability it will tumble shortly, as a result of recently shut off production going back online. To wit: Last year commodity prices were driven lower by deflation, divergence and deleveraging which were reinforcing through a negative feedback loop. Deflationary pressures from excess commodity supply reinforced divergence in US growth and a stronger US dollar which in turn exacerbated EM funding costs and the need for EMs to de-lever though lower investment and hence commodity demand. While we believe that these dynamics likely ran their course last year resulting in signs of rebalancing, the force of their reversal has created a new trend in market positioning that could run further. However, the longer they run, the more destabilizing they become to the nascent rebalancing they are trying to price.
- Bloomberg Stumbles On The “Only One Buyer Keeping The Bull Market Alive”
Last week, when Bloomberg was celebrating the 7 year anniversary of the third longest, most central bank-supported, and thus “most hated” bull market in history, it said that “investors are awash in angst, showing little faith the run can continue. They worry about contracting corporate earnings, slowing Chinese growth and uncertainty over interest rates. And they’re walking the talk by pulling cash from stocks at almost the fastest rate on record. It’s not unwarranted – the S&P 500 has gained just 0.5 percent in the last 18 months.”
- Stocks are climbing that ever-higher “wall of worry”
It can hardly be denied that stocks are climbing that infamous “wall of worry”. Every day it seems, more and more doom-laden headlines appear in the media to suggest stocks are heading for an almighty fall. That is making my “headline indicator” (HI) start to twitch (as it has done recently for crude oil and gold). On Thursday afternoon, Mario Draghi unleashed his latest money-printing bazooka, and I made a few comments on Friday on how that related to the euro. Since then, there has been a veritable barrage of negative comment from the pundits on why central banks are out of ammo. Many conclude that the next crisis will see them powerless to stem the inevitable wave of selling.
- Fed’s ‘Cocaine and Heroin Injection’ a Criminal Act-Gerald Celente
Trends forecaster Gerald Celente says former Fed President Richard Fisher dropped an ominous truth bomb last week on CNBC. Celente says, “Last week, when it was a celebration of . . . 2009 and the markets started going up, Fisher says, quote, ‘We injected cocaine and heroin into the system to enable a wealth effect . . . and now we are maintaining it with Ritalin.’ Fisher also said, a few weeks ago, that ‘the Fed is a giant weapon that has no ammunition left.’ Let’s take his quote, and this is very important, ‘We injected cocaine and heroin into the system.’ You go back to our 2010 alert, and we said this was no recovery. It was a cover-up. What Fisher just said was a criminal act. Injecting cocaine and heroin into the system was a criminal act by the banking gang.”
- Still not enough: US gov’t collects record $1.2 trillion in taxes, or over $8k per taxpayer
Uncle Sam hauled in $1.248 trillion in taxes for the first five months of fiscal year 2016, costing each taxpayer $8,263, according a monthly Treasury Department statement. Even after adjusting for inflation, however, the government is still in the red. The federal government collected more money between October 2015 and February 2016 than it did any other five months in history, said the Treasury statement, released on Thursday. The US fiscal year begins on October 1 and runs through September 30.
- Obama makes case for gov access to all digital devices to prevent terrorism and tax cheats
Without mentioning the government’s case against Apple directly, President Barack Obama told a Texas audience that mobile devices should be built such a way that the government can access them in order to prevent a terrorist attack or enforce tax laws. “The question we now have to ask is: If technologically it is possible to make an impenetrable device or system where the encryption is so strong that there is no key, there’s no door at all, then how do we apprehend the child pornographer, how do we solve or disrupt a terrorist plot?” Obama said during a question and answer session at the South by Southwest Interactive festival in Austin, Texas on Friday, according to Reuters.
- Trend Forecaster Gerald Celente Warns: Prepare For The Panic Of 2016: “History Will Remember This”
Earlier this week hedge fund manager Marin Katusa explained that up until the recent stock market hit all the easy money flowing into the energy sector was being exuberantly spent on hookers, blow and fancy toys. Now, as oil prices hover under $40 per barrel, Katusa said more pain is likely coming and oil, along with other asset classes, are going to go “lower for longer.” In a recent interview with Future Money Trends, trend forecaster Gerald Celente echos Katusa’s concerns. Having accurately predicted the Crash of 2008 nine months ahead of the bottom falling out on a global scale, Celente says another panic is coming this year.
- Credit Card Debt In The United States Is Approaching A Trillion Dollars
For the first time ever, total credit card debt in the United States is approaching a trillion dollars. Instead of learning painful lessons from the last recession, Americans continue to make the same horrendous financial mistakes over and over again. In fact, U.S. consumers accumulated more new credit card debt during the 4th quarter of 2015 than they did during the years of 2009, 2010 and 2011 combined. That is absolutely insanity, because other than payday loans, credit card debt is just about the worst kind of debt that consumers could possibly go into. Extremely high rates of interest, combined with severe penalties and fees, can choke the financial life out of almost any family in no time at all.
- Beware: The market’s ‘crystal ball’ just turned from bullish to bearish
Once again, the stock market’s crystal ball proved to be deadly accurate. About a month ago, I wrote that the option premiums on the Volatility Index (“VIX”) were slanted highly in favor of a lower VIX. And because a lower VIX usually means a higher stock market, I argued the market’s crystal ball – VIX option prices – was predicting a rally in stocks…
- Until this happens, keep buying gold: Gartman
Gold is up nearly 20 percent in 2016, and that has veteran trader Dennis Gartman urging investors not to sit out on the rally. “The trend is up, the trend has been up for the last several months and I continue to think that as long as the monetary authorities are going to remain as expansionary as they are [this trend will continue],” the editor and publisher of The Gartman Letter said in an interview with CNBC’s “Futures Now” on Thursday. “Monetary expansion equals higher gold prices.”
- Jim Rogers: ‘This isn’t the end of the correction in gold’
I recently had a chat with fellow Singapore resident Jim Rogers, one of the most successful investors in history. Jim co-founded the Quantum Fund, one of the world’s most successful hedge funds. After the fund generated returns of more than 4,200% over 10 years, Rogers quit full-time investing. He went on to drive around the world, literally, and write several excellent books that blend travelogue, investment insight, and political commentary. Today, Jim is viewed as one of the founding fathers of the boots-on-the-ground approach to investing in emerging and frontier markets around the world.
- Secret Monetary Group Warns a Catastrophe Is Coming
The Bank for International Settlements is nothing if not obscure. As the central bankers’ bank, it seems little-more than a back-door, private club for monetary elites to rub shoulders. And it’s located in Switzerland which has always carried a reputation for financial secrecy. Then it has this going for it – John Keynes of “Keynesian economic theory” opposed its dissolution back in the 1940s. His was the kind of thinking that has largely influenced central banks to hijack our economies with manipulative monetary policies! So you’d probably think I hate these guys.
- Bundesbank Fears “Doom Loop”
“ECB barrel-scraping getting louder” – that’s what Daiwa Capital Markets called it. But those acts of desperation, as sweet as they seem to the markets, had slammed into opposition at the German Bundesbank. And now “people familiar with the matter” and a “central bank source” are talking to the Wall Street Journal to air their concerns. Yesterday, the ECB bent over backwards to increase the negative interest rate absurdity, given how well it has been working so far. It cut its deposit rate one notch to negative 0.4%. That was less than expected. But it also added a slew of “surprises” intended for the markets to feed on and soar.
- SILVER OUTBREAK: Investment Demand Will Totally Overwhelm The Market
It’s no secret to the precious metal community that silver is one of the most undervalued assets in the market, however 99% of Mainstream investors are still in the dark. This was done on purpose to keep the majority of individuals invested in Wall Street’s Greatest Financial Ponzi Scheme in history. You see, this is the classic PUMP & DUMP strategy. Unfortunately, it’s not a lousy penny stock that Wall Street is pumping, rather it’s the entire market. Most pump & dump stock campaigns last a day, week or a few months. Sadly, this one has gone on for decades and the outcome will be disastrous for the typical American.
- “Gloom” Returns To China’s Economy: Industrial Production, Retail Sales Miss Lowest Estimates
After an unprecedented surge in Chinese attempts to stimulate the economy in late 2015, mostly on the fiscal side, coupled with recent monetary easing by the PBOC which cut the banks’ reserve ratio recently and unleashed a tsunami of new loan creation in January, many expected that this unprecedented credit impulse would translate into at least a modest rebound for the economy, prompting a stable pick up in spending for the economy which many are touting is now consumer-spending driven as opposed to export and production.
- From Champs To Chumps: Latin America Oil Giants Owe $275 Billion
The Latin American state-run oil companies whose largesse filled government coffers from Mexico to Brazil during the crude boom of the previous decade are quickly becoming dangerous liabilities as soaring debt levels spook investors. Regional leaders are being forced to shelve plans to spend petro-cash on popular projects after oil prices plunged more than 50 percent in the past two years and are instead grappling with mounting bills at their state-backed champions. The burden is being amplified as local currencies crumble against the dollar, driving up the cost of to pay off foreign debt.
- A Right Way and a Wrong Way to Weather “The War on Cash”
Many people have been talking recently about the “war on cash.” With policymakers seriously talking about eliminating cash, it can be worrisome. But there is a way to avoid the consequences of the “war on cash. You just need to pick the right strategy. With the endless lowering of interest rates and the possibility that they could turn negative, there is more incentive than ever for people to pull their dollar savings from banks and just hold on to the paper cash at home. After all, why risk your dollars in a bank that yields zero return or even charges you to hold your money? As a result, people are buying up safes, pulling their dollars out of the bank, and storing them at home.
- Why Negative Rates Can’t Stop the Coming Depression
Are you ready to pay to save? Agora founder Bill Bonner explains why “negative interest rates” are spreading around the world…and could soon come to the U.S. Negative interest rates are a disaster story in the making. And they will only speed up the major monetary collapse we believe is coming. Bill believes the fallout from his catastrophe will be far worse than 2008. When it hits, every service you’ve come to depend on – your bank…your grocery store…your Social Security checks – will shut down.
- U.S. import prices fall for eighth straight month
U.S. import prices fell in February for an eighth straight month, weighed down by declining costs for petroleum and a range of other goods, but the pace of decline is slowing as the dollar’s rally fades and oil prices stabilize. The Labor Department said on Friday import prices slipped 0.3 percent last month after a revised 1.0 percent decrease in January. Import prices have decreased in 18 of the last 20 months, reflecting a robust dollar and plunging oil prices. They were down 6.1 percent in the 12 months through February. That was the smallest year-on-year drop since December 2014. Economists polled by Reuters had forecast import prices slipping 0.6 percent last month after a previously reported 1.1 percent fall in January.
- China’s yuan hits 2016 high on strong fixing, global US dollar weakness
China’s onshore yuan on Friday (March 11) hit its strongest level against the US dollar in 2016, buoyed by the central bank’s firmest midpoint this year and the greenback’s slide after the European Central Bank suggested it was done cutting rates for now. Offshore yuan strengthened 0.3 per cent from Thursday to hit its highest level since early December at 6.4733 just before midday. The onshore yuan hit 6.4866 in late morning trade, its highest level since Dec. 29. Its previous 2016 peak was 6.4880, on Feb 15.
- Silver Could Be Poised to Come Out of the Shadows
While there’s been a lot of attention focused on gold over the last few months, silver has remained in the shadows. The white metal has lagged a bit behind as the gold market turned bullish over the last few months. But there are some good reasons to take a close look at silver. According to Bloomberg, silver has advanced 10% since the first of the year while gold surged 18%. But dynamics look good for silver to close that gap: “Silver hasn’t been so cheap relative to gold for more than seven years and with mine supplies forecast to contract this year that may be a sign it’s ready to come out of the yellow metal’s shadow.”
- Men’s Wearhouse parent closing 250 stores
Shares of Tailored Brands, formerly known as Men’s Wearhouse, jumped more than 11 percent in early trading Thursday, a day after the company announced plans to close roughly 250 stores this year. That includes shuttering 80 or 90 full-price Jos A. Bank stores. The announcement followed worsening sales trends at that label in the fourth quarter, with the company adding that it expects weakness there to continue into 2016. Revenues at Jos. A. Bank have gotten whacked since the company ended its ubiquitous Buy One Get Three Free promotion in October.
- The World Economy Wreckers Of Beijing
The desperate suzerains of the Red Ponzi are incorrigible. There appears to be no insult to economic rationality that they will not attempt in order to perpetuate their power, privileges and rule. So now comes the most preposterous gambit yet. Namely, a veritable tsunami of state handouts to foster, yes, capitalist entrepreneurs! That’s right. As described by Bloomberg, Premier Li Keqiang gave the word, and, presto, nearly $340 billion poured into an instantly confected army of purported venture capital funds run by local government officialdom all over the land.
- German bank that almost failed now being paid to borrow money
German bank Berlin Hyp had just issued 500 million euros worth of debt… at negative interest. I wondered if I really did go through a time warp, because this is exactly the same madness we saw ten years ago during the housing bubble and the subsequent financial crisis. To explain the deal, Berlin Hyp issued bonds that yield negative 0.162% and pay no coupon. This means that if you buy €1,000 worth of bonds, you will receive €998.38 when they mature in three years. Granted this is a fairly small loss, but it is still a loss. And a guaranteed one. This is supposed to be an investment… an investment, by-the-way, with a bank that almost went under in the last financial crisis. It took a €500 billion bail-out by the German government to save its banking system. Eight years later, people are buying this “investment” that guarantees that they will lose money.
- ECB cuts rates to new low and expands QE
The European Central Bank has unveiled a series of new measures to strengthen the eurozone’s recovery, with policy makers expanding their quantitative easing package and cutting benchmark interest rates to a new low. The ECB has raised the amount of bonds the eurozone’s central bankers buy each month under QE from €60bn to €80bn — a greater amount than many analysts had expected. It also expanded the range of assets it will buy to include corporate bonds. At the moment, the ECB buys mostly government debt alongside smaller amounts of bundles of smaller loans repackaged into asset-backed securities and covered bonds. The central bank’s governing council also cut its deposit rate by 10 basis points to minus 0.4 per cent. The main refinancing rate fell by 5 basis points to 0 per cent. The move, which was towards the low end of markets’ expectations, in effect raises the fee charged on some bank deposits parked at central banks in the Eurosystem.
- Former Reagan Advisor: Congress Just “Hatcheted” Your Social Security Benefits
While it went virtually unnoticed, Section 831 of the House’s new budget bill could radically change your Social Security benefits as soon as May 1. This change will affect the benefits that as many as 21.3 million Americans could be eligible for, instantly. It could change your chosen retirement date. It could change the way you vacation. It could change your entire financial future…
- Bear Market 2016 Will Get Worse for One Major Reason
During a four-day rally last week, the Dow Jones Industrial Average climbed 490 points. And that was just the most recent surge in the index’s 1,200-point recovery since its dismal start in early January. While the signs of a rebound were encouraging, Money Morning experts say “bear market 2016” isn’t close to being over. “Despite some moderately positive economic news last week, the global economy remains depressed and the prospects for significantly higher stock prices are low,” Money Morning Global Credit Strategist Michael Lewitt said.
- The Stronger U.S. Dollar Is Actually Destroying the Markets
The U.S. dollar remains the most important financial instrument in the world. The dollar rally has been the single most decisive factor in determining economic growth (or weakness) and market direction since early 2014. And – right now – that’s not a good thing. Don’t listen to Alan Ruskin, the macro strategist from Deutsche Bank (need I say more?) who posits that the strengthening dollar is largely a positive, since it’s paired with an “improving labor market” and a “lower misery index.” He’s looking for misery in all the wrong places.
- Terminally ill face being forced to do work experience or lose their benefits
Terminally ill people face being forced to work to keep their benefits under draconian new Government plans, it was revealed yesterday. Cancer patients who have more than six months to live could have to do work experience or see their payments slashed under the scheme by Work and Pensions Minister Iain Duncan Smith.
- Number of people on zero-hours contracts in UK increases to 801,000
The number of workers on zero hours contracts in the UK has increased by 15 per cent in the last three months of 2015 compared with a year earlier, an increase of 104,000 contracts, according to the latest figures from the Office for National Statistics. One in 40 UK workers is on a contract that does not guarantee a minimum number of hours, the figures show. Some 801,000 workers were on zero-hours contracts in the UK from October to December 2015, or 2.5 per cent of people in employment, compared to 697,000 workers in the same period in 2014. Part of the increase may be accounted for by additional recognition of the term zero-hours, the ONS said, rather than new contracts.
- Jim Rogers Says 100% Probability US Is Heading for Recession; Data Backs Him Up
Media and government officials keep telling us the economy looks great, but a peek behind the curtain tells a different story. Some people do see the writing on the wall. Peter Schiff has been saying the US may well have already entered a recession. Last month, Jim Grant echoed Peter, saying the US economy likely went into recession in December 2015. And in a recent interview, Rogers Holdings Chairman Jim Rogers said there is a 100% probability the US will be in a downturn within a year: “It’s been seven years, eight years since we had the last recession in the US, and normally, historically we have them every four to seven years for whatever reason—at least we always have. It doesn’t have to happen in four to seven years, but look at the debt, the debt is staggering.”
- This chart explains how the Baltic Dry Index could spell doom for the global economy
Even if you follow markets and global economics news, you still may not know what the Baltic Dry Index (BDI) is and why it matters. You might guess it’s related to shipping – and you’d be right. The BDI is a very useful gauge of global trade, and tells you how much it costs to move goods around the world in massive ships. These goods can be pretty much anything: iron ore, grain, coal … stuff the world needs to build things and function. As such, analysts keen to predict how the health and future of the global economy like to pay close attention to it.
- Are You Kidding Me? Chinese Exports Plunge 25.4 Percent Compared To Last Year
We just got more evidence that global trade is absolutely imploding. Chinese exports dropped 25.4 percent during the month of February compared to a year ago, and Chinese imports fell 13.8 percent compared to a year ago. For Chinese exports, that was the worst decline that we have seen since 2009, and Chinese imports have now fallen for 16 months in a row on a year over year basis. The last time we saw numbers like this, we were in the depths of the worst economic downturn since the Great Depression of the 1930s. China accounts for more global trade than any other nation (including the United States), and so this is a major red flag. Anyone that is saying that the global economy is in “good shape” is clearly not paying attention.
- China Resorts to “Stealth Interventions” to Prop Up Yuan and Stock Market
A record $1 trillion or so has fled China in the last year or so. Official reserve data is masked, so it’s difficult to pin a precise number. We do know the official monthly drain is the smallest since June, but Daiwa Capital Markets believes PBOC Using Stealth Intervention as Reserves Decline.
- Crackpot Valuations
The markets are eerily quiet. With so many trends and facts to titillate us all, you’d expect a little more excitement. As it is, the big sell-off at the start of the year seems incomplete – a kind of financial foreplay without the climactic battering of a real bear market. What to make of it?
- A $10 billion hedge fund is bracing for a 2008-type event
Perry Capital, a $10 billion New York-based multi-strategy hedge fund led by Goldman Sachs alum Richard Perry, is preparing for another credit event like 2008. Perry Capital bought $1 billion worth of credit-default swaps (CDS) on about 10 investment-grade corporate bonds, The Wall Street Journal reported last month. Investment-grade bonds have a rating of BBB or higher by Standard & Poor’s or Baa3 or higher by Moody’s. They are companies seen as having the safest balance sheets. Perry stands to profit if those companies are downgraded by ratings agencies.
- Markets betting on near-zero interest rates for another decade
World markets may have recovered their poise from a torrid start to the year, but their outlook for global growth and inflation is now so bleak they are betting on developed world interest rates remaining near zero for up to another decade. Even though the U.S. Federal Reserve has already started what it expects will be a series of interest rate rises, markets appear to have bought into a “secular stagnation” thesis floated by former U.S. Treasury Secretary Larry Summers. The idea posits that the world is entering a peculiarly prolonged period in which structurally low inflation and wage growth – hampered by aging populations and slowing productivity growth – means the inflation-adjusted interest rate needed to stimulate economic demand may be far below zero.
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