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 September 23, 2016 to September 29, 2016:
- The Biggest Monetary Transformation Since WWII
Every 30 to 40 years the world has a new monetary system. And the global dollar standard is the worst design of all these systems — yet it’s 45 years old. It’s way overdue for its own demise. And when this one crumbles, everyone is going to feel it.
- Major Dollar Shortage Exposed In Europe As Deutsche Bank Contagion Spreads
“Storm in a teacup” this is not. While global markets remain calm(ish), distracted by OPEC headlines, US election ‘entertainment’, and Middle East proxy wars, the reality is, something very ugly is accelerating in Europe. With the collapse of the “most systemically dangerous bank in the world” we should hardly be surprised, but Deutsche Bank’s crash is being shrugged off by average joes on mainstream media… and besides, the central banks will save us, right? Well, Deutsche contagion is spreading… rapidly. Since Deutsche’s recent highs, the short-end of the EUR-USD basis swap curve has collapsed…
- As Jubilee Nears, Martial Law Rolls Out Across The US
This is not going away with the end of the Jubilee Year in October or even with the end of 2016.
It’s just getting started… As we enter into the last week before the end of the Jubilee Year, the National Guard has been deployed in Charlotte, North Carolina and massive military convoys have been deployed in the streets of New York City. This is a continuation of last summer’s Jade Helm seven-state military exercise that many in the area saw as a prelude to military occupation. After Jade Helm came the US Army Special Operations Command’s Unconventional Warfare Exercise 16 (UWEX 16) that ran in Texas through June.
- Jim Willie: If Deutsche Bank Goes Under It Will be Lehman TIMES FIVE!
A bank failure contagion, that’s whats going to push the price of gold WAY over $2,000/oz again. The Price of Silver is going to be moving over $100 and the price of gold is going over $5,000… A failure of Deutsche Bank would trigger a systemic banking contagion the likes of which the Western world has never seen…
- Famous Last Words – Deutsche Bank: “We Don’t Need A Bailout”
“[The] share price is low but that is not what is worrying us and that is not what we are looking at. What is really important to us is our credit story which is very strong, it is fundamentally strong.” – Jorg Eigendorf, head of communications at DB on CNBC (sourced from Zerohedge). “The credit story is strong?” To begin with, I’m not sure what the head of communications is doing on bubblevision talking about “credit.” If he understood the meaning of the words he was regurgitating from script, he would not have made that statement if he were under oath.
- Insider Warren Buffet Knows A Massive Crash Is Coming: “Has $70 Billion On The Sidelines… Clearly Anticipating The Biggest Buying Opportunity Of His Life”
With the U.S. stock market near all-time highs and financial pundits touting the miracles of economic recovery, investors would have to be totally insane to not be snapping up as many stocks as they can get their hands on. But if America’s economy is doing so well, why are billionaires and major investment firms warning of rough waters ahead? Even Warren Buffet, the Oracle of Omaha, known for his investing acumen and foresight, appears to see the writing on the wall. Having made billions in the fallout of the 2008 crash by taking advantage of lucrative government machinations, Buffet now looks to be positioning himself for a very massive buying opportunity. According to analyst Jeff Nielsen, the head of one of the largest investment companies in the world isn’t invested as heavily into stock markets as you may think. In fact, Nielsen says in his latest interview with SGT Report that Buffet has over $70 billion sitting in cash on the sidelines. And that can mean only one thing: Buffet knows a crash is coming and he is waiting for perhaps the biggest buying opportunity of his lifetime.
- Germany ‘prepares Deutsche Bank rescue’
The German government and financial authorities are working on a rescue plan for Deutsche Bank in case it cannot pay fines in the US, according to Die Zeit newspaper. Germany’s biggest lender is facing a $14bn (£10.8bn; €12.5bn) bill for mis-selling mortgage-backed bonds before the financial crisis of 2008. In the worst-case scenario, the government would even take a 25% stake in the bank, according to the article. Deutsche Bank has denied the report.
- Deutsche Bank Is Going Under: Is The Real Reason Germans Were Told To Prepare For A National Crisis?
There is a very real possibility that Deutsche Bank is going down. If the most prominent bank in Germany fails, the effect on Europe will be profound, and I don’t think the United States will escape the effects. The ripples will turn into a tsunami as they travel across the Atlantic. Already, the bank’s troubles have stressed the American stock market. Angela Merkel has stated that Deutsche Bank will not be getting a bailout from the European Central Bank – the lender of last resort for European banks. The Department of Justice recently issued a $14 billion fine to the bank to settle a mortgage-backed securities probe…and the bank has no intention of paying.
- Euro “Might Start To Unravel” If Deutsche Bank Collapse
The euro “might start to unravel” if Deutsche Bank collapses according to respected financial journalist Matthew Lynn. “It all has a very 2008 feel to it …” he warns in the Telegraph where he outlines his growing concerns about Deutsche Bank, concerns we have written about in recent months. He writes: Our image of German banks, and the German economy, as completely rock solid is so strong that it takes a lot to persuade us they might be in trouble.
- ‘Something Very Serious Transpired’ Between Russia and US Over Syria
The current “level of violence in verbal attacks” on Russia at the UN is unprecedented,” Gilbert Doctorow, European Coordinator for the American Committee for East West Accord told Radio Sputnik, adding that this seems to indicate that something grave must have happened between the two countries with regard to Syria behind the scenes. The United States and Russia have lashed at each other over the Syrian conflict, with Washington and Moscow trading blows at the urgent UN Security Council meeting on Sunday.
- As they left the White House, the Clintons Defaced Walls, Stole Furniture and Much Much Worse
In 2001, the Clintons were moving out of the White House to make way for the Bush Administration. Not only did the Clintons steal furniture on their way out of the White House, but they did something far worse. It’s yet another reason why they should not be allowed to step foot in the White House AGAIN! Besides the stolen furniture, Hillary Clinton and her lackeys defaced walls, stole a presidential seal dating back to the Eisenhower years, damaged furniture they deemed not expensive enough to take, and left a huge mess in the offices, making it look like a rave party had taken place there.
- Dangerous Bubbles In Plain Sight
Jesse Felder published an incisive bubble finance chart over the weekend. It is yet another reminder that Janet Yellen and her merry band of money printers are oblivious to the dangerous speculation and valuation excesses that their policies have implanted throughout the financial system. Relative to disposable income, the value of household financial assets now far exceeds the last two bubble peaks. And that has happened in an economic environment which suggests just the opposite. To wit, valuation multiples and cap rates should be falling owing the fact that the productivity and growth capacity of the US economy has been heading south ever since the turn of the century.
- The Global Housing Bubble Is Biggest In These Six Cities
One year ago, when UBS last looked at the world’s most expensive housing markets, it found that London and Hong Kong were the only two areas exposed to bubble risk. What a difference a year makes, because in the latest report by UBS wealth Management, which compiles the bank’s Global Real Estate Bubble Index, it found a new champion for the title of “world’s biggest housing bubble”, namely a familiar name, Vancouver, but also that as many as six cities had made the “bubble” category, up from last year’s two. Of last year’s two “winners”, London has been knocked into second place this year, and Hong Kong sixth, but both are still in bubble-risk territory.
- The Donald Nailed It: “We Are In A Big Fat Ugly Bubble”
Most of the 90 minutes last night was a waste—with both candidates lobbing well-worn clichés, slogans and sound bites at the audience and each other. But there was one brief moment that made it all worthwhile. That was when Donald Trump peeled the bark off the Fed’s phony recovery narrative and warned that the stupendous stock market bubble it has created will come crashing down the minute it stops pegging rates to the zero bound.
- Deutsche Curve Inverts As Bundesbank Dismisses State Support Of “Zombie” Banks
Deutsche Bank Sub CDS closed above 500bps for only the second day in its history (and the longer-term CDS curve inverted once again) as a bad day ended worse with Bundesbank member Andreas Dombret exclaimed “state support of banking sector must end,” warning that it only “props up zombie banks.” His pronouncements also pushed politicians to make the hard decisions and “tell banks they need structural reform.” As Bloomberg details, “Political support for the banking sector has to end at last,” Bundesbank board member Andreas Dombret says in text of speech in Vienna. “Unfortunately I’m only seeing this to a limited extent.”
- The Stunning Roadmap To $26,000 Gold
With many investors worried about the economic turmoil that has engulfed the globe, is gold headed to $26,000? The Stunning Roadmap To $26,000 Gold. Stephen Leeb: “The Fed’s decision this past week to hold rates steady was no surprise. After all, going into the confab, the odds of a hike had been put at around 20 percent. And only two of the 23 market makers in government securities had any expectation rates would rise, and even those two said they weren’t really sure. Still, the markets exhaled, and a two-day rally in stocks, gold, and commodities followed, though it petered out by Friday…
- John Embry Warns Global Implosion Edges Closer
As we get ready to head into what may well be a very interesting October for global markets, today John Embry warned King World News that we are edging closer to the ultimate global implosion. John Embry: “Eric, as I watch the unfolding economic and financial saga unfolding globally, I’m reminded of the famous quote from Hemingway’s The Sun Also Rises. When asked, how did you go bankrupt? One of the protagonists responded: “Gradually, then suddenly.”…
- Standing on House of Cards-Jonathan Cahn
Rabbi Jonathan Cahn, a Messianic Jew, is out with a third best-seller in a row called “The Book of Mysteries.” In the “Harbinger,” he has said things like the attack on America on 9/11 was a warning. Now, Cahn is out with some new warnings. On the economy, Cahn says, “We are still on a house of cards, standing on a house of cards. There’s debt, and all the propping up, and actually, since the Shemitah of 2008, the world economy has never recovered. It’s been paralyzed. The growth has been paralyzed since 2008, and that’s with all the lowering of rates, which means we have no room for anything . . . . We are in the most dangerous months of the stock markets. . . . We are right now . . . in the period following the seventh Shemitah, which is the Jubilee period. It doesn’t have to happen, but it means the same dynamics (market crash) can happen as well into this period. There is a principle in the Bible that is linked to this . . . it says that if a nation follows God, it’s going to be lending to many nations and not borrowing. That is a sign of God’s favor. America has been the greatest creditor nation in history, but that changed as America has been falling away from God. This goes with the harbingers, and that has not stopped either. . . . As America continues to rapidly accelerate away from God, at the same time, America turned from the greatest creditor nation to the greatest debtor nation.”
- China debt could wreck the global economy: Leading economist warns country could suffer a calamitous slowdown
China poses the biggest threat to the global economy as its debts soar, according to a leading economist. Ken Rogoff, the former chief economist at the International Monetary Fund, said the country could suffer a calamitous slowdown – dragging the rest of the world down with it. A so-called ‘hard landing’ in the world’s second biggest economy, where growth drops to dangerously low levels, would be a disaster for other countries including Britain. China is the UK’s sixth biggest export market with sales of goods made in British factories to the People’s Republic jumping from £877million in 1998 to £15.5billion in 2014.
- Deutsche Bank Stock Crashes Near Single-Digits As CDS Spike To Record Highs
The “most systemically dangerous bank in the world” is in grave trouble. Despite exclamations that there is “no need for additional capital” and that “Deutsche Bank is no Lehman” investors are fleeing the bank’s assets en masse as professionals pile in to buy counterparty risk protection. With the only thing standing between bank runs and stability being the confidence of depositors, and knowing full well that everybody lies when it gets serious, one witty trader noted, “if it walks like Lehman, and talks like Lehman… it is Lehman.”
- IMF and WTO issue alerts on global trade
It is the kind of headline that sends a shiver through economists’ spines: “Global trade growth hits new low.” After all, over the past few decades, economic growth has been closely correlated with trade flows. And on the occasions throughout history when trade growth has plunged – in the 1930s, for instance, or the 2008 financial crisis – it has prefigured deeper problems with the world economy.
- Harvard Professor Demands Ban On $20, $50, $100 Bills
Six months since Larry Summers first suggested “it’s time to kill the $100 bill,” and three months after The ECB actually killed the €500 Note, another Harvard scholar is reinvigorating the war on cash. Amid claims that paper money fuels corruption, terrorism, tax evasion, and illegal immigration, Ken Rogoff (ironically of “It’s Different This Time” infamy) says the US should get rid of the $100 bill (and $50s and $20s) proposing, in his words, “a ‘less-cash’ society, not a cashless one, at least for the foreseeable future.” According to the esteemed ivory tower academic, paper currency lies at the heart of some of today’s most intractable public-finance and monetary problems. As Rogoff explains in The Wall Street Journal, getting rid of most of it – that is, moving to a society where cash is used less frequently and mainly for small transactions – could be a big help.
- Washington Tries to Break BRICS – Rape of Brazil Begins
Washington’s regime change machinery has for the time being succeeded in removing an important link in the alliance of large emerging nations by railroading through a Senate impeachment of the duly elected President, Dilma Rousseff. On August 31 her Vice President Michel Temer was sworn in as President. In his first speech as president, the cynical Temer called for a government of “national salvation,” asking for the trust of the Brazilian people. He indicated plans to reform, and has also signaled his intention to overhaul the pension system and labor laws, and cut public spending, all themes beloved of Wall Street banks, of the International Monetary Fund and their Washington Consensus. Now after less than three weeks at the job, Temer has unveiled plans for wholesale privatization of Brazil’s crown jewels, starting with oil. The planned Wall Street rape of Brazil is about to begin.
- Party Loyalty Can’t Make Me Vote for Clinton
I have been steeped in the Democratic Party all my life. My father, Jerry, was a New York City Democratic chairman and power broker, and I grew up in and around the Democratic Party. When I was a young man, former senators and Democratic presidential and vice-presidential nominees Hubert Humphrey and Estes Kefauver stayed at my apartment and we would proudly discuss the great traditions of the Democratic Party. My father was a pallbearer at St. Patrick’s for Bobby Kennedy’s funeral. When I was young, Robert F. Kennedy and John F. Kennedy were (and remain) my political heroes. Four years ago, former New York Gov. and liberal lion Mario Cuomo spoke at my father’s funeral. I think his son, current Gov. Andrew Cuomo, is a very effective leader.
- Switzerland votes in favour of more government surveillance amid fear of terror attacks
Swiss voters have approved a bill which give their security services more power to eavesdrop on its citizens. A proposed law was approved by 65.5 per cent of those who voted in the referendum, results on Sunday showed. The law grants the Swiss police and intelligence services the right to tap phones and communications of a suspect with the permission of the federal court, the defence ministry and the cabinet – something that has been banned in the country unlike many of its European neighbours.
- Saudi Arabia Bails Out Banking System After Interbank Rates Hit 2009 Highs
Amid what some might call self-inflicted economic collapse, Saudi Arablia has announced a $5.3 billion bailout of its banking system as interbank borrowing rates near the highest since Lehman. In what the supposedly central bank calls “supportive monetary policy…on behalf of government entities,” is easing liquidity constraints with 28-day repo agreements and is the second liquidty injection this year. While Saudi default risk has fallen – as the entire world has been liquified in recent months – it remains worse than Mexico, Russia, and South Africa.
- Germany Goes There: “You Can’t Compare Deutsche Bank To Lehman”
“When it’s important, you have to lie,” is the now well-known mantra from European leaders when the crisis hit. So when a German politician proclaims “you can’t compare Deutsche Bank with Lehman. The bank is in a position to get out of this situation on its own,” it’s time to panic. Just a week after the 8th anniversary of Lehman’s collapse, the multi-trillion dollar derivative book of Deutsche Bank dwarfs that of Lehman… and the credit markets are starting to wake up again.
- Global debt climbs towards fresh high as companies and countries keep on borrowing
Global debt issuance is on course to hit a record high in 2016 as figures showed sales this year topped $5 trillion (£3.9 trillion) at the end of September. Debt issuance rose to $5.02 trillion in the nine months to September 22, according to Dealogic, putting 2016 on course to beat the all-time high of $6.6 trillion recorded in 2006. Record low interest rates have encouraged countries and companies to issue debt as central banks around the world try to stimulate growth.
- Chinese Contagion Risks Surge: Banks’ Reliance On Each Other For Funding Hits All Time High
It’s getting increasingly more difficult for China to deny its massively overindebted reality. The latest striking confirmation that things in the world’s former growth dynamo are deteriorating rapidly, come yesterday from none other than PBOC advisor Huang Yiping, who during a speech in Beijing said that China’s “deleveraging isn’t making progress” and that the “high leverage ratio is becoming a big financial problem for the country” noting that the household leverage ratio has “surged sharply in China.” Adding something ZH readers have known for the past year, Yiping said that “mining and property sectors have the highest leverage ratio” in the country and while the M2/GDP ratio is “not the best gauge to measure leverage for China” he notes that the “leverage ratios in state-owned companies have kept growing since 2008.” None of this is a secret: one look at the chart below from the IIF according to which China’s gross leverage is now roughly 300% of GDP, confirms just that.
- Why Deutsche Bank’s Shares Are at a Record Low: QuickTake Q&A
Deutsche Bank AG, Germany’s largest bank, has been in the spotlight for months as Chief Executive Officer John Cryan struggles to reorganize the business in the face of tougher capital standards, negative interest rates and soaring legal bills. Shares fell to an all-time low on Monday amid escalating concerns over the future of the bank, one of the world’s most systemically important financial institutions.
- Germany Will Rescue Deutsche Bank If Necessary, Allianz Says
The German government will have to bail out Deutsche Bank AG if its financial situation gets bad enough, Allianz Global Investors AG Chief Investment Officer Andreas Utermann said. “I don’t buy at all what’s coming out of Germany in terms of Germany not wanting to step in ultimately if Deutsche Bank was really in trouble ,” Utermann said Monday in a Bloomberg Television interview with Francine Lacqua and Tom Keene. “It’s too important for the German economy.”
- “It All Has A Very 2008 Feel To It” – For Deutsche Bank, The News Just Keeps Getting Worse
It has already been an abysmal day for Germany’s biggest lender: overnight Deutsche Bank plunged to fresh all time lows on speculation whether the German government would or wouldn’t provide state aid to the bank (if needed), forcing the bank to state it does not need the funds at the same time as the government urged markets that “you can’t compare” Deutsche Bank and that “other” bank, Lehman Brothers, although looking at the chart, one may beg to differ.
- A Crashing Deutsche Bank Scrambles To Assure Markets That It Is “Fine”
With Deutsche Bank stock plunging to fresh all time lows in early trading after Merkel reportedly ruled out state aid the embattled German lender, the bank found itself in the unenviable position of once again having to defend its balance sheet to avoid further stock price declines, especially as doubts mounted if the German government response was due to a pre-emptive request for aid. DB quickly tried to squash such speculation when a bank spokesman said that “CEO John Cryan at no point asked the German Chancellor for the government to intervene in the U.S. Justice Department’s mortgages case.” He added that Deutsche Bank will solve its problems without relying on help from Berlin, Germany’s flagship lender said on Monday. The market remains unconvinced: shares in Germany’s biggest bank hit a record low of 10.62 euros on Monday…
- Merkel Rules Out Bailout For Deutsche Bank: Depositor Bail-In Coming Up?
The €42 trillion (notional) derivatives mess known as Deutsche Bank remains under severe pressure. Its market cap is $17 billion. It has no earnings and pays no dividend. On April 23, Deutsche Bank was Fined $2.5 Billion over LIBOR rate rigging. Twenty-one people face criminal charges following a seven-year investigation. On September 16, the US Department of Justice Fined Deutsche Bank $14B for mortgage securities fraud leading up to the 2007-2009 global meltdown. Today, German Chancellor Angela Merkel Ruled Out Assistance for Deutsche Bank.
- As China prepares to announce their gold reserve amount by end of the month, debate over gold backed Yuan increases sharply
As part of their requirements to enter into the SDR basket of currencies in October, China will soon be revealing the quantity of their gold reserves sometime between now and Sept. 30. And with them also recently being appointed the managers of the M SDR internationalization program, debate over China implementing a gold backed currency is once again increasing at an accelerating rate. At the heart of the discussion is how China is using their growing geo-political power to integrate 3rd world nations, especially those in Africa, in moving forward despite not having the economic finances to expand their infrastructure base. And to date this has been shown to be moderately successful in a myriad of different ways, and could be the catalyst for catapulting a gold backed Yuan using their growing alliances and Silk Road strategies to envelop a large portion of the world under a financial umbrella that would be impervious to U.S. and Western subjugation.
- New World Order Mouthpiece Warns We Are on Verge of Greatest Debt Jubilee in History
“Alarm bells have been ringing over the explosion of corporate debt levels in emerging economies, which now exceed $25 trillion … Damaging deflationary spirals cannot be ruled out”. This grim assessment comes from an article posted at Telegraph.co.uk, that quotes a recent annual UN “Conference on Trade and Development” report. The article is entitled, “UN fears third leg of the global financial crisis – with prospect of epic debt defaults,” The writer’s name is Ambrose Evans-Pritchard and he’s one of Britain’s most prominent journalists, known for his hard-hitting reporting. He’s also the editor of the International Business section of the Daily Telegraph.
- German Politicians Are Getting Nervous About Deutsche Bank
Just a few short days after Germany’s premier financial publication Handelsblatt dared to utter the “n”-word, when it said that in the aftermath of last week’s striking $14 billion DOJ settlement proposal, “some have even raised the possibility of a government bailout of Germany’s largest bank, which would be a defining event and a symbolic blow to the image of Europe’s largest economy”, German lawmakers are finally starting to get nervous. According to Bloomberg, Deutsche Bank’s suddenly troubling finances, impacted by the bank’s low profitability courtesy of the ECB’s NIRP policy as well as mounting legal costs courtesy of years of legal violations, “are raising concern among German politicians.” At a closed session of Social Democratic finance lawmakers on Tuesday, Deutsche Bank’s woes came up alongside a debate over Basel financial rules. Participants discussed the U.S. fine and the financial reserves at Deutsche Bank’s disposal if it had to cover the full amount.
- Living In A Van Down By The River – Time To Face The True State Of The Middle Class In America
Do you remember the old Saturday Night Live sketches in which comedian Chris Farley portrayed a motivational speaker that lived in a van down by the river? Unfortunately, this is becoming a reality for way too many Americans. As the middle class has shrunk and the cost of living has increased, a lot of people have decided to quite literally “live on the road”. Whether it is a car, a truck, a van, a bus or an RV, an increasing number of Americans are using their vehicles as their homes. Just recently, someone that I know took a trip down the west coast of the United States and stayed at a number of campgrounds along the way. What she discovered was that a lot of people were actually living at these campgrounds. Of course there are some that actually prefer that lifestyle, but many others are doing it out of necessity. Earlier this week, Circa.com posted a story about “the van life”. One of the individuals that they featured was a recent graduate of the University of Southern California named Stephen Hutchins. Without much of an income at the moment, he decided that the best way to cut expenses was to live in his van…
- Monte Paschi Rescue On The Rocks: Regulators Now “Expect Bank To Ask Italy For Bailout”
Ever since two months ago, when Italy’s third largest bank – and the world’s oldest – Sienna’s Monte dei Paschi, failed Europe’s latest stress test, it had scrambled, and assured markets, that it would obtain a private sector cash injection, aka bailout, amounting to roughly €5 billion in fresh capital, there was significant speculation in the Italian press that the capital raise was not going well as third party investors were uncomfortable to allocate funds to a bank whose history of failure and unprecedented bad NPL book remained a daunting obstacle. The reason why Monte Paschi was forced to seek a private sector bailout is that Germany had repeatedly shut down Italian PM Matteo Renzi’s attempts to pursue a public sector bailout. Instead, the Germans demanded that instead of a public sector bailout the bank should implement a bail-in, and impair various liabilities, which however could result in another bout of public anger, due to the substantial retail investment in the bank’s unsecured bonds, perhaps culminating with a run on the bank.
- UN fears third leg of the global financial crisis, with epic debt defaults
The third leg of the world’s intractable depression is yet to come. If trade economists at the United Nations are right, the next traumatic episode may entail the greatest debt jubilee in history. It may also prove to be the definitive crisis of globalized capitalism, the demise of the liberal free-market orthodoxies promoted for almost forty years by the Bretton Woods institutions, the OECD, and the Davos fraternity. “Alarm bells have been ringing over the explosion of corporate debt levels in emerging economies, which now exceed $25 trillion. Damaging deflationary spirals cannot be ruled out,” said the annual report of the UN Conference on Trade and Development (UNCTAD).
- China’s Holdings of U.S. Treasuries Fall to Lowest Since ’13
China’s holdings of U.S. Treasuries fell in July to the lowest level in more than three years, as the world’s second-largest economy pares its foreign-exchange reserves to support the yuan. The biggest foreign holder of U.S. government debt had $1.22 trillion in bonds, notes and bills in July, down $22 billion from the prior month, in the biggest drop since 2013, according to U.S. Treasury Department data released Friday in Washington and previous figures compiled by Bloomberg. The portfolio of Japan, the largest holder after China, rose $6.9 billion to $1.15 trillion. Saudi Arabia’s holdings of Treasuries declined for a sixth straight month, to $96.5 billion.
- First Factories, Now Services Signal Cracks in U.S. Economy
Some cracks could be starting to appear in the picture of an otherwise resilient U.S. economy. An abrupt drop in the Institute for Supply Management’s services gauge on Tuesday to a six-year low is the latest in a string of unexpectedly weak data for August. Other less-than-stellar figures include an ISM factory survey showing a contraction in manufacturing; a cooling of hiring; automobile sales falling short of forecasts; and an index of consumer sentiment at a four-month low. While there is hardly any evidence that growth is falling off a cliff, the run of disappointing figures make it tougher to argue that the underlying momentum of the world’s largest economy is holding up. It also potentially complicates the task of Federal Reserve policy makers, who are debating whether to raise interest rates as soon as this month; traders’ bets on a September move faded further after the report on service industries, which make up almost 90 percent of the economy.
- Goldman Sachs Bans Employees from Donating to Trump
Timing of rule, which OKs Clinton contributions, will be questioned. Goldman Sachs has enacted a set of rules that bans the firm’s top employees from contributing to certain campaigns, including the Trump-Pence ticket. The rules kicked in Sept. 1 and will apply only to partners of the firm. The memo detailing the rule change was first reported by Politico. The firm says the rules were meant to remove any implication of so-called “pay to play.” Four years ago, the bank paid $12 million to settle charges that a former Boston-based banker had picked up bond underwriting business in the state while working for and contributing funds to the campaign of a then Massachusetts state treasurer and governor-hopeful, Tim Cahill.
- See The 5 Facts That Prove Trump Is ACTUALLY Beating Hillary Badly
Donald Trump has been taking names and not taking prisoners. He is killing Hillary Clinton and has even had to do it by going up against the media’s rigged polls. Truth Division recently posted the following five statistics that prove that Trump is really winning. FACT #1: Trump has twice the amount of followers on Facebook. Fact #2: Trump has 10.6 million twitter followers. Fact #3: Trump averages 30k viewers per live stream. Fact #4: Instagram – Trump has 2.2 million followers. Fact #4: Reddit – Trump: 197,696 subscribers.
- Take Your Money Out of the Bank, While You Still Can
It is now clear, the government of Cyprus was given two options by the IMF and the EU in which they were told that they could steal money from private bank accounts or they could leave the Eurozone all together and face total economic annihilation. This theft involves seizing the funds of all accounts over 100,000 euros, then stealing up to 40% of those funds sometime over the next few weeks, or whatever EU finance ministers decide exactly how much to steal. I However, no accounts containing less than 100,000 euros will be impacted. This amount was not arbitrarily chosen. The 100,000 mark was chosen because all EU bank accounts are insured up to 100,000 euros. Therefore, the criminal banksters believe that they can steal anything over 100,000 euros because it is not insured.
- Deutsche Bank Investors Fret Its Legal Reserves Won’t Be Enough
Deutsche Bank AG is moving closer to settling one of its biggest legal cases. How it manages to pay will depend on whether it can persuade the U.S. to lower its initial request of $14 billion, and by how much. The shares of Germany’s biggest bank plunged on news the Department of Justice is seeking an amount that’s more than twice the 5.5 billion euros ($6.1 billion) Deutsche Bank has set aside for litigation. Aside from the U.S. probe into residential mortgage-backed securities, the lender also faces inquiries into matters including currency manipulation, precious metals trading and billions of dollars in transfers out of Russia.
- Italy Is the Mother Of All Systemic Threats
Italy has been in a crisis for at least eight months, though mainstream media did not recognize it until July. This crisis has nothing to do with Brexit, although opponents of Brexit will claim it does. Even if Britain had voted to stay in the EU, the Italian crisis would still have been gathering speed. The high level of non-performing loans (NPLs) has been a problem since before Brexit. It is clear that there is nothing in the Italian economy that can reduce them. Only a dramatic improvement in the economy would make it possible to repay these loans. And Europe’s economy cannot improve drastically enough to help. We have been in crisis for quite a while. Banks were simply carrying loans as non-performing that were actually in default and discounting the NPLs rather than writing them off. But that only hid the obvious. As much as 17 percent of Italy’s loans will not be repaid. This will crush Italian banks’ balance sheets. And this will not only be in Italy. Italian loans are packaged and resold, and Italian banks take loans from other European banks. These banks in turn have borrowed against Italian debt. Since Italy is the fourth largest economy in Europe, this is the mother of all systemic threats.
- Money Is Pouring Into Property Deals Banks Won’t Touch
Heightened scrutiny of U.S. commercial real estate lending is paving the way for lightly regulated investors to gain a bigger toehold in lucrative deals. Private funds are seeking a record $32 billion for commercial-property debt as buyout firms, real estate investment trusts and hedge funds expand lending. These companies, which typically charge higher interest rates, can move quickly on large loans that may be seen as too speculative for banks.
- Recession Watch: US Freight Drops to Worst Level since 2010, “Excess of Capacity” Crushes Rates
When FedEx announced its quarterly earnings today, it included some telling tidbits. In its largest segment, FedEx Express, domestic shipping volume edged up merely 1%. In its smaller FedEx Ground Segment, shipping volume jumped 10%, “driven by e-commerce and commercial package growth.” Sales by e-commerce retailers jumped 15.8% year-over-year in the second quarter, according to the Census Bureau, and companies involved in getting the packages to consumers and businesses have seen growth in those segments. For the rest, not so much – as the goods-based economy is getting bogged down.
- We Are Headed For War-Paul Craig Roberts
Former Assistant Treasury Secretary (in the Reagan Administration) Dr. Paul Craig Roberts has a stark warning for the world. Dr. Roberts says, “We changed our nuclear doctrine. It used to be we used nuclear weapons only in retaliation. There was no first use, but the George W. Bush regime, the Neocons, changed our nuclear doctrine. It’s now a preemptive first strike. So, this tells both the Russians and Chinese they could get a preemptive first strike. Then, we tell the Russians we are putting missiles right on your border. You won’t have two minutes’ notice. They can’t accept that. It’s too much risk from a crazy country (U.S.) that won’t negotiate with them. . . . So, we’re headed for war. I think the only thing that would block it is if one or two of the European governments realize that they have nothing whatsoever to gain with a conflict with Russia. . . . The only thing they could do to prevent a nuclear war is to pull out of NATO.”
- BRICS commit to global growth, stability
Chinese Foreign Minister Wang Yi has praised fellow BRICS member nations for their combined efforts to push for a political solution to the Syrian Civil War but urged the bloc to work diligently to preserve world peace and help promote global growth. Speaking following a meeting with BRICS foreign ministers on the sidelines of the United Nations General Assembly in New York, Wang said: “We need to continue to be an advocate for using peaceful means, including dialogue and negotiation, to solve global hot spots.” Russian Foreign Minister Sergei Lavrov seized on Wang’s statement and said that the BRICS members are fully capable of working toward establishing a fairer and more just international order, with better coordination on key political and economic issues.
- Michael Pento On The Coming Bond Bubble Collapse
All asset classes will collapse in tandem when this bursts – an event that will send SHOCKWAVES throughout the global economy: In this week’s podcast, Michael Pento, fund manager and author of The Coming Bond Bubble Collapse, explains how the United States is fast approaching the end stage of the biggest asset bubble in history. He describes how the bursting of this bubble will cause a massive interest rate shock that will send the US consumer economy and the US government—pumped up by massive Treasury debt—into bankruptcy, an event that will send shockwaves throughout the global economy.
- Jim Willie Warns US Dollar Faces 30% Devaluation As BRICS Prepare Return of Gold Standard!
The Fascist Business Model incorporates all the worse elements of Keynesian economics, a broken fallacious school of thought. The model also integrates a vast system of economic heresy, put forth as public address dogma. All their messages are wrong. They are instead aligned with support of the power structure where big banks conduct self-dealing and print money for themselves. Consider many of the Fascist Business Model messages, laced within the endless din of propaganda. Their messages are all false, in support of the existing power structure in place. The Jackass privately calls it Reich Economics, a truly broken appendix to the demonstrably broken Keynesian chapters of heretical economics. The West has followed the methods of John Maynard Keynes, who also held disdain for the Gold Standard. In doing so, the West has destroyed the financial platforms, eroded the capital formation devices, polluted the business arenas, and put the entire USEconomy at risk of systemic failure. The only success of the model is preservation of power, which soon will come to an end.
- Four Flash Points That Could Trigger World War III: “We Have Not Been This Close To Nuclear War In A Long Time”
As can readily be seen by the current events, the world has not been this close to a nuclear war and World War 3 in a long time. There are four major flashpoints right now that could easily escalate and ignite a powder keg, transforming from a regional conflict or conflicts into a world war: Syria, the South China Sea, Ukraine, and North and South Korea. The “reconstruction” of a Cold War-type faceoff, initiated by the U.S. and NATO building up forces in Eastern Europe and facing off against Russia. A nuclear war will be initiated by an EMP (Electromagnetic Pulse) detonation over the continental U.S., followed by a nuclear exchange and a war with conventional forces. As of this writing, the U.S. has “mistakenly” bombed Syrian governmental military forces, causing at least 60 deaths with more than 100 others wounded. The Russian government is sizzling, especially with the response by (of all people) Samantha Power, U.S. Ambassador to the UN had this to say to the media, as reported by CNN: “We are investigating the incident. If we determine that we did indeed strike Syrian military personnel, that was not our intention. And we of course regret the loss of life.”
- Trump and Clinton Are “Positive For Gold” – $1,900/oz by End of Year
Trump or Clinton are “positive for gold” and prices could rise to between $1,700 and $1,900 per ounce by year end according to Canadian gold mining magnate Rob McEwen. Gold “is a currency that doesn’t have a liability attached to it,” McEwen said Tuesday in an interview with Bloomberg at a gold conference in Colorado Springs.
- John Embry – The Key To Surviving The Destruction Of The Current Monetary System
As the world awaits tomorrow’s Fed decision, today John Embry spoke with King World News about the key to surviving the destruction of the current monetary system. John Embry: “Eric, I think this should be an interesting week with the Fed meeting taking place tomorrow, and a Japanese monetary meeting taking place simultaneously. I really think the Fed is so out of touch with reality that nothing would shock me…
- Australian property market to collapse in 6 weeks – US think tank
Over the past couple of months, we have written frequently about the impact of Chinese money laundering operations on home prices in a couple of large cities around the globe. So far, the Vancouver market has seemingly been the hardest hit with homes prices collapsing over 20% in one month after the city passed a 15% property tax on foreign buyers on July 25, 2016 (see “As The Vancouver Housing Market Implodes, The “Smart Money” Is Rushing To Get Out Now“). Now, a U.S. based think tank, International Strategic Studies Association (ISSA), is warning that similar efforts to restrict Chinese investment in Australian real estate could send prices tumbling there as well.
- Is U.S. Shale Nearing Collapse?
Crude oil production in the United States has decreased by more than 10 percent since the record high of 2015, from 9.6 million barrels per day (mmbpd) to less than 8.6 mmbpd. However, the drop in shale oil production has reached almost 20 percent. Moreover, if the increasing Permian Basin production were left out of the equation, the decrease in U.S. shale oil output would be about 33 percent! And this fall will deepen as the number of new wells is still not sufficient. The collapse of the shale oil production is related to the decline curve of tight oil, but shale oil well production starts to decline much faster than that from regular wells.
- Central Banks are Buying 385 Tons of Gold Every Year
Central banks have got the economy and markets covered. They know what they’re doing. Their theories are backed up by decades of academic research and expert advice. Expert advice, as we all know, is completely apolitical, changes rarely, and never, ever does a complete U-turn, like – I don’t know – telling us all to start eating butter after years of telling us not to, or something crazy like that. So why worry? I mean, what kind of deluded neurotic doom-monger would keep hanging onto gold (as insurance, of all things!) in their portfolio with people of this calibre in charge? Well, I hate to break this to you, but… Guess who’s buying lots of gold? Central banks are piling into gold. They have been ever since the financial crisis blew up in 2008.
- Why the Fed Destroyed the Market Economy
Swing voters are a fickle bunch. One election they vote Democrat. The next they vote Republican. For they have no particular ideology or political philosophy to base their judgment upon. They don’t give a rip about questions of small government or big government. Nor do they have any druthers about the welfare or warfare state. In effect, they really don’t care. What’s important to the swing voter is much simpler. In fact, it can be boiled down to the following essential question. What have you done for me lately? The answer to this question, of course, comes back to money. As far as the swing voter’s concerned, if their brokerage account’s growing they vote the incumbent party. If it’s shrinking, they vote the challenger party.
- Great Causes, a Sea of Debt and the 2017 Recession
We continue our work with the bomb squad. Myth disposal is dangerous work: People love their myths more than they love life itself. They may kill for money. But they die for their religions, their governments, their clans… and their ideas. Some people think that even an idea as abstract as “freedom of speech” is worth dying for. It was Voltaire who said: “I disapprove of what you say, but I will defend to the death your right to say it.” Most people jump onboard the train of a Great Cause with enthusiasm and conviction. But many have the good sense to hop off quietly before their lives are in real danger. We suspect that Mr. Voltaire would have done the same. That’s why the deadliest myths are those that you can ride along with at no personal risk. Foreign wars, for example, are always a favorite. When Pericles proclaimed that the honor of Athens was at stake, and that it must take up the imperial burden and continue its war with Sparta, he was not offering to invade Sicily himself. Nor was George W. Bush, in announcing his War on Terror, suggesting that he would personally march into Mosul.
- Surprise! Wall Street Goes “All In” for Hillary Clinton
Hordes of industry executives will descend on the city to celebrate Hillary Clinton’s nomination for president and renew close associations that vexed the Democratic standard-bearer throughout her primary battle with Bernie Sanders. Blackstone, one of the nation’s largest private equity firms, will hold an official reception in Philadelphia on Thursday featuring its president, Tony James, sometimes mentioned as a possible Treasury Secretary in a Clinton administration. The financial contingent will be in an especially good mood following Clinton’s selection of Virginia Sen. Tim Kaine as her running mate.Kaine has shown a willingness to fight for regional bank relief from the Dodd-Frank financial reform law. But more than that, he’s not Elizabeth Warren, the potential VP pick that long had Wall Street terrified.
- Abenomics Crushes It——Japanese Exports, That Is!
Japan’s poor exports performance continued in August, with shipments falling for an 11th straight month as a strong yen and tepid global economy undercut demand. Key Points: Exports dropped 9.6 percent in August from a year earlier, the Ministry of Finance said on Wednesday. The median estimate of economists surveyed by Bloomberg pointed to a 4.7 percent decline. Imports fell 17.3 percent, resulting in a trade deficit of 18.7 billion yen ($184 million).
- Daily Data Dive: What Housing Recovery—–SF Starts Still 15% Below 1991 Recession Level
The Commerce Department reported that the headline number for August housing starts was 1.142 million units. This was below the overly optimistic consensus estimate of economists of 1.186 million, and below the July figure of 1.212 million. The numbers are reported on a seasonally adjusted annualized basis, which means that any month to month error in the seasonal factor finagling is multiplied times 12. We prefer to look at the actual data on a rate of change basis, comparing years for a measure of whether the current report was weak or strong.
- Small Business Survey Trips Economic Alarms
Earlier this week, the National Federation of Independent Businesses released their monthly Small Business Survey. While this data is much overlooked by the mainstream media, it really shouldn’t be. Out of the 26 million businesses registered in the United States, only 6 million have active employment and generate revenue. Of that total, almost 80% have fewer than 5-employees. Simply, it is small businesses that drive the economy, employment, and wages. Therefore, what the NFIB says is extremely relevant to what is happening in the actual economy versus the headline economic data from Government sources. In August, the survey declined 2-tenths of a point to 94.4. While that may not sound like much, it is where the deterioration occurred that is most important. Furthermore, despite an improvement from the financial crisis lows, the current levels are still well below the levels normally witnessed at the late stage of an economic recovery.
- U.S. wants Deutsche Bank to pay $14 billion over toxic mortgages
The U.S. Justice Department wants the bank to pay $14 billion over allegations it packaged up toxic mortgages between 2005 and 2007. But Germany’s biggest lender says the huge sum demanded by the U.S. government is just the opening move in what’s likely to be a lengthy back-and-forth. Deutsche Bank has no intent to settle these potential civil claims anywhere near the number cited,” it said in a statement. “The negotiations are only just beginning.” Deutsche Bank (DB) said it expects the wrangling to result in “an outcome similar to those of peer banks which have settled at materially lower amounts.”
- Americans See Current Economic Conditions Worst In 11 Months As Inflation Expectations Plunge
University of Michigan survey results show Current Economic Conditions plunged to 103.5 – the lowest since Oct 2015. The biggest driver of this weakness is tumbling inflation expectations (with 1Y outlook dropping to 2.3% – the lowest since Sept 2010). Confidence was unchanged in early September from the August final and barely different from the July reading. Small and offsetting changes have taken place in the third quarter 2016 surveys: modest gains in the outlook for the national economy have been offset by small declines in income prospects as well as buying plans.
- That $100,000 Painting Bought to Flip Is Now Worth About $20,000
Art dealer and collector Niels Kantor paid $100,000 two years ago for an abstract canvas by Hugh Scott-Douglas with the idea of quickly reselling it for a tidy profit. Instead, he is returning the 28-year-old artist’s work to the market this week at an 80 percent discount. Such is the new art season. At auction houses in London and New York, sellers are preparing to bail on their investments after the emerging-art bubble burst and the resale market for once sought-after artists dried up.
- Trump shatters GOP records with small donors
Donald Trump has unleashed an unprecedented deluge of small-dollar donations for the GOP, one that Republican Party elders have dreamed about finding for much of the past decade as they’ve watched a succession of Democrats — Barack Obama, Bernie Sanders and, to a lesser extent, Hillary Clinton — develop formidable fundraising operations $5, $10 and $20 at a time. Trump has been actively soliciting cash for only a few months, but when he reveals his campaign’s financials later this week they will show he has crushed the total haul from small-dollar donors to the past two Republican nominees, John McCain and Mitt Romney — during the entirety of their campaigns.
- Tiger Cub Citrone Sees Market in Biggest Correction Since 2008
Robert Citrone, the Tiger cub who now runs one of the best-known macro hedge funds, is warning investors that the market moment they’ve been anticipating is at hand. “We believe we are in the midst of the market correction we have been expecting,” Citrone, founder of Discovery Capital Management, told investors in an e-mail obtained by Bloomberg. “It will likely persist over the next 3-4 months and be the largest correction since the 2008 crisis,” he said. The firm managed about $12.4 billion at the start of 2016.
- Gerald Celente Issues Major Trend Forecast For The Rest Of 2016
With the world focused on the Fed decision, today top trends forecaster Gerald Celente issued an important trend forecast for the rest of 2016. Trend Alert: BIS Issues Warning As Gold Bides Time. (King World News) Gerald Celente — Central Bank policies rule the financial world. Their never-in-the-history-of-the-world negative and historically low interest rate policies, plus massive government and corporate bond buying schemes have enriched equity markets but not the general economy…
- Fitch reveals the $2trillion black hole in China’s economy that heralds a lost decade
Bad debts in the Chinese banking system are ten times higher than officially admitted, and rescue costs could reach a third of GDP within two years if the authorities let the crisis fester, Fitch Ratings has warned. The agency said the rate of non-performing loans (NPLs) has reached between 15pc and 21pc and is rising fast as the country delays serious reform, relying instead on a fresh burst of credit to put off the day of reckoning. It would cost up to $2.1 trillion to clean up this toxic legacy even if the state acted today, and much of this would inevitably land in the lap of the government.
- Martin Armstrong On “The Coming Dark Age”
Over the years you have made several comments about directional changes and have alluded to the idea that a crossroads is coming in that we will either enter another Dark Age or we will see the light towards greater liberty and freedom. More recently, you mentioned the year 2032 as a critical year in this regard. In addition, you have mentioned that Trump winning the election would postpone the inevitable chaos, but that HRC winning would speed it along. In terms of the distal effects of the November election on 2032, does either Trump or Clinton winning increase the likelihood of entering a Dark Age over something more hopeful? Should we be attempting to kick the can down the road or should we get it over with?
- The Three Stages Of Empire
I consider it self-evident that we are in the third and final stage of self-serving Imperial decay. Though Edward Luttwak’s The Grand Strategy of the Roman Empire: From the First Century CE to the Third is not specifically on the rise and fall of empires, it does sketch out the three stages of Empire.
- Gold & Silver Surge, Break Technical Levels
Gold and silver are surging this morinng after BoJ’s disappointment as a stronger yen weighs on the USD index. Heavy volume has lifted Gold off key technical support and silver through a major technical resistance… Gold bounces off its 100-day moving-average…
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