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Latest News Articles – June 2, 2016

From James Harkin (Webmaster & Editor of 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.

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Lindsey Williams - Latest News Articles

Latest News From May 27, 2016 to June 2, 2016:

  • Fresh Mainstream Nonsense on Gold Demand
    We and many others have made a valiant effort over the years to explain what actually moves the gold market (as examples see e.g. our  article “Misconceptions About Gold”, or Robert Blumen’s excellent essay “Misunderstanding Gold Demand”).  Sometimes it is a bit frustrating when we realize it has probably all been for naught. This was brought home to us again in a recent missive posted at Kitco, which discusses an RBC research note on gold. In a way, it is actually quite funny. The post at Kitco is titled “Gold’s ‘One-legged’ Rally Is Cause of Concern”. We can assure you it is not of “concern” to us. But we did wonder why the rally was supposedly “one-legged”, so we decided to read on.
  • The Fed Has Tightened Policy A Lot More Than You Think
    Federal Reserve Chair Janet Yellen and her colleagues have tightened monetary policy by a lot more than their benchmark interest rate increase would suggest. It's just that they've done it in the shadows. The so-called shadow federal funds rate rose about 300 basis points from the middle of 2014 through the end of last year as the central bank tapered, then ended its asset purchase program and prepared the way for its single rate increase in December.  The shadow rate's increase helped fuel a rise of the dollar that depressed U.S. exports and economic growth, according to James Hamilton, an economics professor at the University of California at San Diego.
  • China’s Rolling Boom-Bust Cycle
    There is a mysterious figure making regular appearances in China’s government mouthpiece “People’s Daily”, which simply goes by the name “authoritative person” (AP). This unnamed entity always tends to show up with bad news for assorted speculators, by suggesting that various scenarios associated with monetary and/ or fiscal stimulus are actually not in China’s immediate future.
  • Saudi Arabia Considers Paying Contractors With IOUs 
    Saudi Arabia is considering using IOUs to pay outstanding bills with contractors and conserve cash, according to people briefed on the discussions. As payment from the state, contractors would receive bond-like instruments which they could hold until maturity or sell on to banks, the people said, asking not to be identified because the information is private. Companies have received some payments in cash and the rest could come in the “I-owe-you” notes, the people said, adding that no decisions have been made on the measures.
  • Regulators Warn 5 Top Banks They Are Still Too Big to Fail 
    The nation’s top bank regulators have added an unexpected voice to the growing chorus of critics worried that the biggest American banks, nearly eight years after the financial crisis, are still too big to fail. The Federal Reserve and the Federal Deposit Insurance Corporation said on Wednesday that five of the nation’s eight largest banks — including JPMorgan Chase and Bank of America — did not have “credible” plans for how they would wind themselves down in a crisis without sowing panic. That suggests that if there were another crisis today, the government would need to prop up the largest banks if it wanted to avoid financial chaos.
  • The Consequences Of $50 Oil
    On Thursday Brent crude rose above $50 while the WTI rose to $49.85. The rise in prices came after the EIA reported a dramatic fall in U.S. inventories. The weekly drop of 4.2 million barrels, far more than the 2 million that was expected, triggered a sharp rise in a market which had been growing increasingly bullish, sending the Brent price above $50 on Thursday morning. It is the first time in seven months that the price has reached this level. It’s a recovery that came much more quickly than analysts expected. Since reaching a low of $27 in January, both Brent and WTI have risen by nearly 80 percent, an impressive achievement considering the general slump in commodities. Concerns from the Energy Information Agency (EIA) that the world would “drown in over-supply” in 2016 have been allayed.
  • Russia and China buy tons of gold getting ready for dollar collapse
    Russia and China buy gold to get rid of the weakening dollar. The weakening of the US dollar will become even more noticeable. Increasing their gold reserves, Moscow and Beijing make their  economies stronger, the Spanish newspaper El Pais wrote. According to the publication, central banks of Russia and China have been buying a lot of gold recently. During the past 15 months China has increased its gold reserves by 70% to 1,700 tons, becoming the world's sixth country with largest reserves of gold. Russia's gold reserves have grown by 21 percent to 1,460 tons. During the crisis, the price of gold grows, El Pais says. Demand for gold remains stable. From 2009 to 2015, China was buying 6-8 tons of gold a month, but in the summer of 2015, the country doubled its appetite for the precious metal. Russia started buying gold in 2015, increasing purchases against the backdrop of falling oil prices.
  • China has conducted a ‘war' – not trade – with steel, experts say
    Despite China signaling moves to cut its excess steel production capacity, industry chiefs say the country has declared a metals “war” that has had a “devastating” impact for the rest of the world's industry. Overcapacity in the steel industry has been a thorn in the side of the sector in recent years, pushing prices down and making it harder for some steel companies to survive. China's low-cost metal producers have been widely cited as the main culprit for the glut. In particular, the world's second largest economy has been accused of “dumping” cheap steel on to global markets, due to a slowdown in domestic demand, in a bid to gain market share. However Beijing has denied any wrongdoing and has said that its costs are lower than other producers.
  • Central Bankers put Ponzi and Madoff to Shame
    Charles Ponzi must be turning in his grave! His pyramid scheme in 1920 guaranteed returns of 50% in 50 days and 100% in 100 days. And initial investors clearly achieved these returns but most of them were too greedy to cash in. His total scheme “only” lost $20 million ($225 million in today’s money) for the investors. In comparison, Madoff cost his investors $18 billion. At least Ponzi became famous for his achievement. So far Madoff has not achieved fame. But both Ponzi and Madoff were small time crooks compared to governments and central banks today. Because whether we take, Japan, China, the EU or the USA, they have all created Ponzi schemes which are exponentially bigger than what Ponzi did. Admittedly no government is promising the 50% return that Ponzi did or Madoff’s 10-12%. Instead they are giving investors of their “Ponzi” bonds the illusion that they will receive the capital back. To paraphrase Mark Twain, investors are neither going to get the return ON their money nor the return OF their money, at least not in real terms.
  • Peter Schiff: June Rate Hike Immaterial; Rate Cuts and Quantitative Easing Up Next 
    Will the Federal Reserve raise rates in June? Peter Schiff says it’s immaterial. Peter appeared on CNBC’s Fast Money and created a firestorm when he said he sees this as a repeat of what happened at the end of last year and suggested everybody knows the Fed is at the end of its tightening cycle.#
  • China's Largest Bank is Quiety Cornering the Market for London Physical Gold
    We have followed the ownership changes of London's massive vaults with keen interest ever since our December 2014 article when we reported that Deutsche Bank's gold vaule was for sale in “Massive 1,500 Ton Gold Vault For Sale In The Heart Of London, One Previous Owner, Asking £4,500,000 O.B.O.” The fate of that particular vault was revealed earlier this year when Reuters reported that none other than China's largest bank, ICBC Standard Bank, was buying the lease on Deutsche Bank's London gold and silver vault, “enlarging its footprint in the city's bullion market”. The Chinese and South African lender is aiming to fill the gap left by Western banks, which are retreating from commodities to cut costs and reduce regulatory burden. “They (ICBC Standard Bank) have taken on the lease for the vault,” the first source said. Deutsche Bank's vault became operational in June 2014 and has a capacity of 1,500 tonnes. It was built and is managed by British security services company G4S. “The figure that was initially talked about may have been around $4 million, but it's way lower now,” a second source said, without disclosing the figure paid for the vault.
  • Trump: ‘Who the Hell Cares if There’s a Trade War?’
    Donald Trump responded on Thursday to conservatives critical of his proposal to impose a tariff on imported goods, characterizing them as “dummies” at a New Jersey fundraiser for Gov. Chris Christie. “These dummies say, ‘Oh, that’s a trade war.’ Trade war? We’re losing $500 billion in trade with China. Who the hell cares if there’s a trade war?” Trump rhetorically asked the audience. “Think of it,” the presumptive Republican nominee added. “$500 billion and they’re telling me about a trade war.”
  • BNN Advisor: Automated advice shakes up the investment industry
    There’s a “new” player who’s changing the landscape for the entire investment advisor industry. It’s the emergence of the robo-advisor, and while these online advisors manage about $50 billion dollars in assets globally today, that number is expected to balloon to $2 trillion in the next four years. With our panel of advisors, BNN examines these new online tools that use software to help investors build their portfolios.
  • The CME Admits Futures Trading Was Rigged Under Old System
    Ask any trader what they believe to be the hallmark feature of any “rigged market” and the most frequent response(in addition to flagrant crime of the type supposedly demonstrated every day by Deutsche Bank and which should not exist in a regulated market) will be an institutionally bifurcated and legitimized playing field, one in which those who can afford faster, bigger, more effective data pipes, collocated servers and response times – and thus riskless trades – outperform everyone else who may or may not know that the market is legally rigged against them. Think of it as baseball game for those who take steroids vs a ‘roid free game, only here the steroids are perfectly legal for those who can afford them. Or like a casino where the house, or in this case the HFTs, always win. However, as it turned out, the vast majority of the public had no idea that a small subset of the market was juicing, despite our constant reports on the topic since 2009, until the arrival of Michael Lewis' book Flash Boys, which explained the secret sauce that made all those HFT prop shops into unbeatable “trading titans”: frontrunning.
  • David Dayen’s ‘Chain of Title' Confirms What You Always Suspected: The Game is Rigged
    Chain of Title should be required reading in every college-level business ethics class in America. At a time when “business ethics” is an oxymoron, perhaps the current generation that adores Bernie Sanders might better understand the dangers big banking monopolies hold. David Dayen’s newly released non-fiction book, Chain of Title, unearths a system with the power and collateral to stonewall millions of homeowners from obtaining one very simple answer: Who owns my mortgage? If you haven’t been able to wrap your head around why the federal government has failed to prosecute one banker for the foreclosure crisis there is a very simple answer that Chain of Title alludes to. The federal government has a dark secret: the trusts are empty and the falsified notes cannot be traced back to their true owners so they must be “recreated” if a default occurs. This means that the investors, the pensions and the trusts own nothing. It also means that the banks now own everything- including the U.S. federal government. It hardly matters that we have separation of powers if the bankers and elite control all three branches.
  • MELTDOWN 2016? China Set To Implode GLOBAL Economy LATE SUMMER (Again)… INSIDER SAYS GET PREPARED NOW! Brexit… Soros Buying Up Massive Amounts Of Gold Bullion
    China’s Communist Party goes way of Qing Dynasty as debt hits limit. Nobody rings a bell at the top of the credit supercycle, to misuse an old adage. Except that this time somebody very powerful in China has done exactly that. China watchers are still struggling to identify the author of an electrifying article in the People’s Daily that declares war on debt and the “fantasy” of perpetual stimulus. Written in a imperial tone, it commands China to break its addiction to credit and take its punishment before matters spiral out of control. If that means bankruptcies must run their course, so be it. The 11,000 character text – citing an “authoritative person” – was given star-billing on the front page. It described leverage as the “original sin” from which all other risks emanate, with debt “growing like a tree in the air”.
  • Wells Fargo launches 3% down payment mortgage
    First-time buyers and low- to moderate-income buyers have largely been sidelined by today's housing recovery. The common cry is too-tight credit. Lenders have kept the credit box restrictive because they are gun-shy from the billions of dollars in buy backs and judicial settlements stemming from the mortgage crisis that they still face today. Now, the nation's largest lender, Wells Fargo, says it is opening that box with a new low down payment loan — a loan it claims is low-risk to the bank.
  • Understanding Societal Collapse: Warnings From Venezuela's Crisis
    As we write about the risks of our over-indebted economy, of our unsustainable fossil fuel-dependent energy policies, and our accelerating depletion of key resources, it's not a far leap to start worrying about the potential for a coming degradation of our modern lifestyle — or even the possibility of full-blown societal collapse. Sadly, collapse is not just a theoretical worry for a growing number of people around the world. They're living within it right now.
  • 25 Years, $13 Billion Lost: Connecticut Income Tax Continues To Fail
    Twenty-five years ago, amid economic turmoil and a looming budget crisis that put legislators at each other’s throats, the then-governor of Connecticut made a fateful decision. Unsure of the best way to dig Connecticut out of its financial hole, Governor Lowell Weicker implemented an income tax. The Nutmeg State would certainly come to rue that day. Of course, Governor Weicker did not anticipate that the adoption of an income tax would send the state into a tailspin. In fact, as he announced his plans on May 15, 1991, he said, “I feel great.” In 2015, however, Connecticut taxpayers are feeling less than great. Despite Governor Weicker’s promises – that the income-tax revenue would be spent responsibly, that the additional dollars would correct Connecticut’s financial course – the new tax only led to further disarray and decline.
  • What happens when you're deported to Britain?
    A widowed mother-of-five who has lived in Australia for most of her life is facing deportation to the UK. What awaits her when she gets off the plane, asks Claire Bates. Kelly Webb, 30, hasn't seen Britain since she moved to Australia at the age of two. But she has a British passport, so could be sent back to the UK after serving a prison sentence for burglary. It's not an unusual situation. In 2015, 71 out of the 134 deported prisoners helped by the charity Prisoners Abroad had been residents of Australia, Canada or the US for many years. The charity is the first point of call for prisoners facing deportation, and guides clients through the resettlement process.
  • Is The Market Priced For A Summer Rate-Hike?
    Last November, capital markets were discounting a rate hike five months later, based on Fed Funds futures. Same story today. Last November, the S&P 500 was trading near 2100. Same story today. Last November, VIX levels were around 14. Same story today. Last November, instead of waiting five months, the Fed hiked rates one month later; the S&P dropped by 10% over the next eight weeks… And as BofAML's Savita Subramanian warns, hiking during a profits recession usually hasn't ended well. Admittedly, other factors contributed to the decline, but history is rhyming, and BofAML thinks a rate hike this summer could drive some downside. While Fed Funds futures prior to mid-May implied little to no chance of a summer hike, the release of the latest FOMC meeting minutes have shifted futures to a 30% probability of a June hike and a 50% probability of a July hike.
  • BSI Shut by Singapore as Swiss Start Probe; EFG Takes Over Bank
    Singapore is closing Swiss bank BSI SA’s unit in the city-state and Switzerland began criminal proceedings against the firm, as investigations into a troubled Malaysian state fund reverberate throughout the private bank’s international operations. The Monetary Authority of Singapore said it will withdraw BSI Bank Ltd.’s license for breaches of money laundering rules and impose S$13.3 million ($9.6 million) in financial penalties on the BSI unit for 41 breaches, including its failure to conduct due diligence on high-risk accounts and monitor suspicious customer transactions. Singapore authorities have also referred six senior BSI executives to the public prosecutor, including the private bank’s former chief executive officer in the city state and his deputy.
  • Core Durable Goods Orders Slump As Inventories Decline For 4th Straight Month
    Core Durable Goods Orders tumbled 0.8% MoM and 6.7% YoY – down 15 of the last 18 months. However, following drastic revisions across the entire time series and thanks to a surge in military spending (+3.7%) and non-defense aircraft (+64.9% – bringing back memories of Boeing's aberration from a year or two back) the headline Durable Goods print rose 3.4% MoM. More worrying for GDP enthusiasts is the 0.2% decline in durable goods inventories in April for the 4th straight month. Not a pretty picture under the hood….
  • Building robot McDonald's staff ‘cheaper' than hiring workers on minimum wage
    A former McDonald's CEO is warning that robots will take over jobs at the huge enterprise – because it's cheaper than employing humans. He said that buying highly skilled robotics is cheaper than employing people at the fast food restaurant. The worrying forecast comes as he warns huge job losses are imminent, and that it's ‘common sense' to replace humans in the workplace.
  • Richmond Fed Crashes Into Contraction From 6 Year Highs, Biggest Drop In History
    Having spiked mysteriously to 6 year highs in March (from 4 year lows in Feb), Richmond Fed's manufacturing survey crashed back into contraction in May (printing -1 against =14 prior and +8 expectations). Weakness was broad-based across the entire set of subcomponents with New Orders plunging, shipments crashing, employees and workweek tumbling, and worse still future employment and capex expectations dropped precipitously. The drop in the last 2 months is the largest in the 23 year history of the survey.
  • Negative interest rates spark record gold rush as demand for safe deposit boxes jumps
    Investors snapped up gold at a record pace in the first three months of 2016 as global growth fears intensified and central banks slashed interest rates deeper into negative territory. Concerns that Britain could leave the EU also triggered a spike in demand across Europe where ” investors were plagued by lingering Brexit fears,” according to the World Gold Council.
  • DEUTSCHE BANK: The Fed is probably screwed
    The Federal Reserve wants to do two things right now: Prepare markets for future interest rates hikes & Raise interest rates. But the problem, according to Deutsche Bank's global economics team, is that by preparing markets for future interest rate hikes the Fed potentially hampers its ability to actually carry out those hikes in the future. Said another way, the Fed appears stuck in a negative feedback loop wherein suggestions that higher rates are coming create the unsettled conditions that ultimately force the Fed to keep rates right where they are. And so on.
  • Oil Price Tops $50 As Canada Fires Fuel Recovery
    The barrel price of Brent Crude oil, which is seen as the global benchmark of oil industry performance, has reached $50 for the first time in 2016 as supply problems due to wildfires in Canada continue to have an impact. The oil industry has been in turmoil over the past several years, with the price of Brent Crude hitting 13-year lows of less than $28 a barrel in February amid concerns of a global oversupply and disruption in the world markets. The $50 milestone was reached in the early hours of the morning during Asian trading following the news that US inventories of oil had fallen in response to disruption in Canada. Wildfires in the country have resulted in a cut in oil output by up to a third. The value was later holding strong at $50.16.
  • Should I Be Worried About Gold Confiscation?
    One of the common questions we hear from gold buyers is, “Is it possible that the government might come after my gold and confiscate it?” In a time when the governments are waging a war on cash, it’s not hard for people to imagine that a war on gold is next. There is some precedence for this, after all. On April 5, 1933, Franklin D. Roosevelt’s Executive Order 6102 “[forbade] the Hoarding of gold coin, gold bullion, and gold certificates within the continental United States.” Americans who owned gold were told to deliver their gold to the bank and in exchange receive paper dollars of equivalent value, $20.67 per ounce at the time.
  • Former McDonalds CEO Crushes The Minimum Wage Lie: “It's Cheaper To Buy A Robot Than Hire At $15/Hour”
    While this should come as no surprise to any rational non-establishment-teet-suckling economist (and certainly not to our readers), former McDonalds' CEO Ed Rensi continued his crusade against the naive “solution” to poor living standards that has been peddled by a clueless administration in the form of a higher federal minimum wage, and after he patiently explained one month ago that “the $15 minimum wage demand, which translates to $30,000 a year for a full-time employee, is built upon a fundamental misunderstanding of a restaurant business just do the math” Rensi found that nobody has still done the math. Which is perhaps why the ex-CEO reappeared on Fox Business yesterday to explain to Maria Bartiromo that as fast-food workers across the country vie for $15 per hour wages, many business owners have already begun to take humans out of the picture, McDonalds most certainly included.
  • US Government Quietly Cuts Historical Capex Data By Billions Of Dollars
    While Wall Street looked upon today's Durable Goods report with caution, noting the substantial beat in the headline print which was entirely as a result of a surge in nondefense aircraft orders (read Boeing) which soared by 65%, there was substantial weakness below the surface especially in the core capex print, the capital goods orders nondefense ex-aircraft, which disappointed significantly, sliding 0.8% on expectations of a 0.3% rebound. However, that was just part of the story. A far bigger part was missed by most because as always Wall Street was focused on the sequential change, and not on the absolute number. As it turns out, the Department of Commerce decided to quietly revise all the core data going back all the way back to 2014. In doing so it stripped away about 4% from the nominal dollar amount in Durable Goods ex-transports, where the March print was slashed from $154.7 Billion to $148.3 Billion…
  • Russia's ‘Iron Man' robot soldier is country's latest terrifying war weapon
    Meet Ivan the Terminator – Russia's robotic answer to Iron Man that could be about to change military warfare forever. The terrifying new robot soldier is the latest in the country's list of high-tech weaponry as it competes with the US and China in the artificial intelligence stakes. According to Russian newspaper Komosomolskaya Pravd, the droid is designed “to replace the person in the battle or in emergency areas where there is a risk of explosion, fire, high background radiation, or other conditions harmful to humans. “The development of a special military robot is one of the priorities of military construction in Russia.” The Iron Man machines are remotely controlled, but there are fears that they could become completely autonomous in the future.
  • Ottawa posts $2B deficit for fiscal year as income tax revenue falls in March
    The federal government posted a deficit in line with what was projected in its spring budget as personal and corporate income tax revenue fell in March. According to its preliminary estimates, the Finance Department said today there was a $2 billion deficit for the government's latest fiscal year. However, that was before any year-end adjustments as well as a $3.7 billion commitment to benefits for veterans. The spring budget had projected a $5.4 billion deficit for the 2015-16 fiscal year. The final results are expected to be released in the fall, but the Finance Department said the results were “broadly in line” with what was projected in the budget. For March, the last month of the fiscal year, the government posted a $9.4 billion deficit compared with a deficit of $3 billion in the same month last year. The shortfall came as government revenue fell $5 billion due to lower personal and corporate income taxes, offset in part by higher excise taxes and duties. Program spending increased $1.3 billion, while public debt charges gained $100 million.
  • Paris and Berlin ready ‘Plan B’ for life after Brexit
    European leaders have stepped-up secret discussions about a future union without Britain, drawing-up a “plan-B” focused on closer security and defence co-operation in the event of a UK vote to leave the EU. At several overlapping meetings in recent weeks — in Hanover, Rome and Brussels — EU leaders and their most trusted aides have discussed how to mount a common response to Brexit, which would be the bloc’s biggest setback in its 60-year history. More than a dozen politicians and officials involved at various levels have sketched out to the Financial Times the ideas for concerted action to “double down on the irreversibility of our union” — as well as the many internal divisions that stand in their way. Rather than attempt a sudden lurch to integrate the eurozone, Chancellor Angela Merkel of Germany and President François Hollande are instead eyeing a push to deepen security and defence co-operation, a less contentious initiative that has appeal beyond the 19-member euro area.
  • Eurozone RUPTURE: Now SPAIN threatens to tear EU apart as banks LOSE €1.4BILLION in a day
    ANIC over the stability of Spanish banks hit fever pitch yesterday, exposing yet another rupture in the financial system holding the eurozone together. Banco Popular, one of the Spain's leading financial firms, caused mayhem after admitting that it needed billions to bolster its balance sheet. Shocked investors dumped shares in the firm, with the bank stock's value plunging by 24 per cent this morning, after the cash call and plans to issue another 2 billion shares. It resulted in €1.4billion being wiped off the value of the bank's share price.
  • Venezuela Stepping Up Gold Selling as Petrodollars Dry Up
    Venezuela has ratcheted up efforts to sell off its gold holdings and raise the cash needed to fund imports and pay back debts after the collapse in oil throttled the economy. The country cut its gold reserves by 16 percent in the first quarter, following a 24 percent reduction in 2015, according to data from the International Monetary Fund. The 1.38-million ounce reduction was the largest by any central bank since Switzerland sold 3.2 million ounces in the third quarter of 2007, and coincided with continued increases in gold reserves in mainland China.
  • New financial MELTDOWN set to sink EU as German banks lose £14,292,610,000.00 in 90 DAYS
    EUROPE'S biggest economy was plunged into fresh chaos tonight amid warnings a new financial crisis in Germany could destroy the EU. Shares in Germany's two biggest lenders – Deutsche Bank and Commerzbank – fell sharply again as panic gripped global markets. They have now seen their combined market value plummet by more than £14BILLION in the past three months. Deutsche Bank shares fell by nearly four per cent to close at an all-time low amid turmoil not seen since the depths of the financial crisis in 2009. Meanwhile shares in Commerzbank, Germany's second biggest lender, fell even further, by 4.65 per cent, to close at their lowest level in nearly two-and-a-half years.
  • Q1 2016 Canadian Silver Maple Sales Surge To Highest Record Ever
    The Royal Canadian Mint just published its Q1 2016 Report, and the silver bullion coin sales figures were stunning to say the least.  Not only did sales of Canadian Silver Maple Leafs surpass its previous record during the third quarter last year, it did so by a wide margin. Why is this such a big deal?  Because Q1 2016 sales of Silver Maples topped the Q3 2015 record, without surging demand and product shortages.  Last year, there was a huge spike in silver retail investment demand due to the supposed “Shemitah” or the collapse of the broader stock markets.  Investors piled into silver in a big way as they perceived a year-end market crash was inevitable.
  • Outrage as EU chief calls for EURO ARMY commanded by Brussels to take on Russia and IS
    BRUSSELS’ top bureaucrat came under fire yesterday after calling for a European army to be set up as part of a common foreign and security policy. Jean-Claude Juncker – backed by leading German politician’s – said a “euro-army” commanded by Brussels would provide a “more credible” response to threats, including from Russia. But his comments sparked a storm of protest in Britain, where eurosceptic campaigners have long warned of Brussels’ ambitions for its own defence force. Ukip MEP and defence spokesman Mike Hookem said: “Ukip have been ridiculed for years and branded scaremongers for suggesting that the UK’s traditional parties were slowly relinquishing control of our defence and moving toward a European Army. “However, yet again, UKIP’s predictions have been proved correct.
  • Gold Prices Should Rise Above $1,900/oz -“Get In Now!”
    Gold prices are likely to rise above $1,900/oz in the next phase of the bull market and investors should “get in now,” Chief Market Analyst of the Lindsey Group, Peter Boockvar told CNBC’s “Futures Now” yesterday. “This is just the beginning of a new bull market in the metals,” Boockvar believes. Ultimately, Boockvar believes that the 2011 highs of around $1,900 for gold are not only reachable, but surpassable, as he reasoned that bull markets historically exceed the previous bull market peak at some point. As Boockvar sees it, it’s just a matter of when.
  • And Another Week Of Selling: “In 2016, Equity Funds Have Lost The Largest Ever Outflow For The Asset Class”
    For many weeks in a row now we have been asking, mostly jokingly, how with everyone else (both retail and “smart money”) selling, and with stock buybacks sharply lower in recent months, is the market higher. Specifically, who is buying? This question is no longer a joke. After this week's 17th consecutive outflow by “smart money” funds (mostly on the back of surging hedge fund redemption), moments ago we got the latest Lipper fund flow data. It was, as BofA put it, “unambiguous risk-off weekly flows.” As BofA also put it: “Equities continued to experience outflows and lost $3.32bn (-0.1%) last week, their 4th consecutive decline. Year-to-date, equity funds have lost $58.6bn (-0.6%), the largest ever dollar outflow in any 22 week period for the asset class”
  • Japan’s Abe points to 2008 crisis as G7 leaders debate global risk
    Group of Seven leaders voiced concern about emerging economies at a summit in Japan on Thursday as their host, Prime Minister Shinzo Abe, made a pointed comparison to the 2008 global financial crisis but not all his G7 partners appeared to agree. The G7 leaders did agree on the need for flexible spending to spur world growth but the timing and amount depended on each country, Deputy Chief Cabinet Secretary Hiroshige Seko told reporters, adding some countries saw no need for such spending.
  • Bank of Montreal to cut 4% of workforce, memo says
    Bank of Montreal (BMO.TO) will shed around 4 per cent of its 46,000 workforce as part of a drive to cut costs, staff were told in a memo on Wednesday after the lender reported a decline in quarterly profit. Chief Executive Bill Downe said the move, which will see around 1,850 jobs go, was a response to changing customer behavior and the advent of new digital technologies. “We have taken this step to position the bank for what lies ahead – and to account for the structural changes underway in the financial services industry,” Downe said in the memo seen by Reuters.
  • World’s 16 biggest banks, including RBC, ordered to face Libor lawsuits in ruling court warns could ruin them
    Sixteen of the world’s largest banks including JPMorgan Chase & Co. and Citigroup Inc. must face antitrust lawsuits accusing them of hurting investors who bought securities tied to Libor by rigging an interest-rate benchmark, a ruling that an appeals court warned could devastate them. The appellate judges reversed a lower-court ruling on one issue — whether the investors had adequately claimed in their complaints to have been harmed — while sending the cases back for the judge to consider another issue: whether the plaintiffs are the proper parties to sue, in part because their claims, if successful, provide for triple damages that could overwhelm the banks.
  • Lufthansa to suspend flights to Venezuela
    The German airline, Lufthansa, has announced that it will suspend flights to Venezuela from 18 June due to economic difficulties in the country. The company also said currency controls in Venezuela made it impossible for airlines to convert their earnings into dollars and send the money abroad. Venezuela's economy has been hit hard by a sharp drop in the price of oil – the country's main source of income. Venezuela has high inflation and severe shortages of basic goods. In a statement, Lufthansa said that it “will be forced to suspend our service between Caracas and Frankfurt as of 18 June”. It noted that the demand for international flights to Venezuela had dropped in 2015 and in the first quarter of the current year. However, it said it hoped to restore services in the near future.
  • MELTDOWN 2016? China Set To Implode GLOBAL Economy LATE SUMMER (Again)… INSIDER SAYS GET PREPARED NOW! Brexit… Soros Buying Up Massive Amounts Of Gold Bullion
    China’s Communist Party goes way of Qing Dynasty as debt hits limit. Nobody rings a bell at the top of the credit supercycle, to misuse an old adage. Except that this time somebody very powerful in China has done exactly that. China watchers are still struggling to identify the author of an electrifying article in the People’s Daily that declares war on debt and the “fantasy” of perpetual stimulus. Written in a imperial tone, it commands China to break its addiction to credit and take its punishment before matters spiral out of control. If that means bankruptcies must run their course, so be it. The 11,000 character text – citing an “authoritative person” – was given star-billing on the front page. It described leverage as the “original sin” from which all other risks emanate, with debt “growing like a tree in the air”.
  • How Bad Are The US Computer Systems? An 8” Floppy Disc Houses Nuclear Coordinate Data
    If you thought that $80 billion a year would be a sufficient enough budget for the US government to systematically upgrade its computer systems, think again. In a report released by nonpartisan congressional investigators found that about $60 billion of the government's $80 billion IT budget goes straight to maintenance just to keep the aging technology running, not to modernization according to ABC News.
  • FRANCE STRIKE: ‘The Workers Fight Back’
    All over France strikes and demonstrations are taking place. People are protesting against the French government’s attempt to reform labour laws which would make it easier to hire and fire workers. French labour laws have always been seen as an obstacle to progress by the ruling class due to the modest protection they afford workers. Since the popular front of 1936 and in particular the National Council of the Resistance formed after the liberation in 1945, French worker made significant gains. These ‘acquis sociaux’ or social gains are now being brutally rolled back by a powerful oligarchy bent on driving down the price of labour and increasing the profits of capitalists.
  • This Is How Much Your Health Insurance Payment Is About To Jump By
    It's official: years of warnings that Obamacare will lead to dramatic increases in healthcare premiums are about to be validated. As the WSJ writes, big health plans stung by losses in the first few years of the U.S. health law’s implementation are seeking hefty premium increases for individual plans sold through insurance exchanges in more than a dozen states. To be sure, we have extensively covered the imminent danger of rising healthcare prices as a result of Obamacare's intrusive intervention in the insurance sector; however now that this is about to become mainstream information, we expect consumers to hunker down and save even more in anticipation of what is about to be a shock price increase for millions of middle-class American families. As the WSJ reports, the insurers’ proposed rates for individual coverage in states that have made their 2017 requests public largely bear out health plans’ grim predictions about their challenges under the health-care overhaul. According to the insurers’ filings with regulators, large plans in states including New York, Pennsylvania and Georgia are seeking to raise rates by 20% or more.
  • Former IMF economist asserts that gold is money as good as government bonds
    GoldCore's Mark O'Byrne this week calls attention to commentary written this month by Harvard economics professor Kenneth Rogoff recommending that countries diversify their foreign exchange holdings away from the government bonds of developed countries and into gold. Rogoff's argument seems to be that with interest rates already effectively at zero or below, there's nothing to be gained through the purchase of such bonds, while gold is a “low-risk asset” that offers the possibility of capital appreciation. But then Rogoff makes what from anyone else would be considered the rookie mistake of asserting that “gold does not pay interest,” as if gold isn't leased for interest by Western governments every day in huge amounts and as if gold leasing isn't a primary mechanism of gold price suppression by those governments, the governments whose bonds Rogoff acknowledges are becoming less attractive as investments.
  • We Need New Labels: I Propose “100% Robot Made”
    Yesterday, Apple’s iPhone maker, Foxconn announced an immediate cut of 60,000 workers to be replaced by robots. Today, Adidas announced the first ever 100% robot-made shoe. “Speedfactory”. Deutsche Welle, Germany’s international broadcaster, reports Adidas Shoe Manufacturing Will Return to Germany. That’s the good news. For manufacturing job seekers, the bad news is the shoes will be 100% robot made.
  • Billionaires Are Wrong on Gold
    Recently the mainstream media has reported that several billionaires are concerned about global financial markets and have purchased significant amounts of gold to protect their portfolios. Take Stan Druckenmiller, the famed hedge fund manager who managed money for George Soros as the lead portfolio manager for Quantum Fund. He and Soros famously ‘broke the Bank of England' when they shorted the British pound sterling in 1992, reputedly making more than $1 billion in profits. He has reportedly used over $323 million of his own money to invest in gold. This is approximately a 30% allocation in his $1-billion family fund. His belief in gold can be attributed to his criticism of the Federal Reserve's massive money printing and near-zero interest rates. Ongoing low rates will drive both central banks and investors into gold.
  • Switzerland About to Vote on “Free Lunch” for Everyone
    In early June the Swiss will be called upon to make a historic decision. Switzerland is the first country worldwide to put the idea of an Unconditional Basic Income to a vote and the outcome of this referendum will set a strong precedent and establish a landmark in the evolution of this debate. The Swiss Basic Income Initiative in a demonstration in front of parliament. As we have previously reported (see “Swiss Parliament Shoots Down Socialist Utopia” for details), Switzerland’s parliament has already rejected the idea, with even the socialists voting against it (proving that they are still in possession of most of their marbles and quite likely in possession of an abacus as well).
  • Wow. Congress wants to prohibit the Fed from bailing out bankrupt states.
    Just days ago, in the midst of the Puerto Rico debt morass, 24 members of Congress introduced the “No Bailouts for State, Territory, and Local Governments Act.” The title pretty much sums it up. Congress knows there’s a massive wave of defaults looming at the city and state level. Detroit and Puerto Rico are just the tip of the iceberg. Aside from a few top performers like Alaska, South Dakota, and Wyoming (which, ironically, have no state income tax), many US states have atrocious finances. Illinois and Maine, for example, have dangerously low levels of cash relative to the debts and obligations they have to pay.
  • Oil Prices Likely in Mid-$30s-$40s Per Barrel After OPEC Meet
    Oil prices are likely to fall after the Organization of Petroleum Exporting Countries (OPEC) summit in Vienna next week and then stabilize between around $35 to $45 per barrel, Trends Research Institute head Gerald Celente told Sputnik. Energy ministers of the once powerful oil cartel are set to meet in Vienna on June 2, less than two months after a failure of the April meeting with non-OPEC countries in Doha that sought to freeze oil output at January levels in a bid to shore up prices.
  • EU referendum: Ex-military officers fighting for EU exit
    EU policies are undermining the UK's combat effectiveness, a dozen former senior military officers have warned. Speaking out in favour of Britain leaving the EU, they said that Nato, and not the EU, should remain the cornerstone of Europe's defence. Among the group is General Sir Michael Rose, whose name was originally on a letter organised by Downing Street supporting UK membership of the EU. The Remain campaign says membership of the EU and Nato is not contradictory.
  • Will Deutsche Bank Survive This Wave Of Trouble Or Will It Be The Next Lehman Brothers?
    If you have been waiting for “the next Lehman Brothers moment” which will cause the global financial system to descend into a state of mass panic, you might want to keep a close eye on German banking giant Deutsche Bank.  It is approximately three times larger than Lehman Brothers was, and if the most important bank in the strongest economy in Europe were to implode, it would instantly send shockwaves rippling across the entire planet.  Those that follow my work regularly know that I started sounding the alarm about Deutsche Bank beginning last September.  Since that time, the bad news from Deutsche Bank has not stopped pouring in.  They announced a loss of 6.8 billion euros for 2015, Moody’s just downgraded their debt to two levels above junk status, and they have been plagued by scandal after scandal.  In recent months they have gotten into trouble for trying to rig precious metal prices, for committing “equity trading fraud” and for their dealings in mortgage-backed securities.
  • Yet ANOTHER Billionaire Warns About Coming Chaos … Maybe There’s Something to This Trend?
    Is there something in the water that billionaires drink? Because yet ANOTHER one just warned about coming market and economic chaos this morning! Sam Zell is his name, and real estate is his game. Zell has founded or invested in multiple public and private real estate firms from his home base in Chicago over the years, and is now worth an estimated $4.8 billion. As a guest host on CNBC today, he offered nothing but cold water and harsh reality for the starry-eyed optimists. Specifically, he said “holding a lot of cash right now doesn’t seem like a terrible opportunity” … added that we’re in the “ninth inning” of the economic cycle … and warned that recession was right around the corner.
  • The CME Admits Futures Trading Was Rigged Under Old System
    Ask any trader what they believe to be the hallmark feature of any “rigged market” and the most frequent response(in addition to flagrant crime of the type supposedly demonstrated every day by Deutsche Bank and which should not exist in a regulated market) will be an institutionally bifurcated and legitimized playing field, one in which those who can afford faster, bigger, more effective data pipes, collocated servers and response times – and thus riskless trades – outperform everyone else who may or may not know that the market is legally rigged against them. Think of it as baseball game for those who take steroids vs a ‘roid free game, only here the steroids are perfectly legal for those who can afford them. Or like a casino where the house, or in this case the HFTs, always win.
  • Moody's downgrades Deutsche Bank's ratings
    Moody's Investors Service has today downgraded the ratings of Deutsche Bank AG and affiliates, including the bank's long-term deposit rating, to A3 from A2, its senior unsecured debt rating to Baa2 from Baa1, its standalone baseline credit assessment (BCA) to ba1 from baa3, and its counterparty risk assessment to A3(cr) from A2(cr). Deutsche Bank's short-term ratings and short-term counterparty risk assessments were also downgraded to Prime-2 from Prime-1 and to Prime-2(cr) and Prime-1(cr), respectively. Today's rating action reflects the increased execution challenges Deutsche Bank faces in achieving its strategic plan. Moody's also downgraded the ratings of US–based Deutsche Bank Trust Corporation and its trust company affiliates. These trust companies' long-term deposit ratings were downgraded to A2 from A1, their long-term issuer ratings were downgraded to Baa2 from Baa1, their standalone baseline credit assessment was downgraded to baa1 from a3; their long-term and short-term counterparty risk assessments were downgraded to A3(cr) from A2(cr) and to Prime-2(cr) and Prime-1(cr) respectively. The Prime-1 short-term deposit ratings of these trust companies were affirmed.
  • Forget a Dollar Collapse…This Is a Much Bigger Threat to Your Wealth Right Now
    It's an immediate threat to your wealth right now…and it's another sign we're headed for a major financial crisis. What we're covering today stems from the Fed's “monetary experiment” that began in 2008. As you may know, that year, the Fed dropped its key interest rate to effectively zero. It then started borrowing and printing trillions of dollars. This experiment has been nothing short of a disaster. Over the past eight years, the Fed's pumped $3.5 trillion into our financial system. And our national debt has more than doubled.
  • These Investing Legends Have Never Been More Bearish on U.S. Stocks
    George Soros is investing like a crisis is around the corner. You’ve probably heard of Soros. Thanks to his legendary track record, he’s one of the world’s most well-known investors. From 1969 to 2001, he generated average annual returns of 20%…nearly beating the S&P 500 2-to-1. Soros also famously “broke the Bank of England” in 1992. These days, he runs Soros Fund Management, which manages about $10 billion.
  • Why China’s Banks Are Toast—-Losses May Hit $1.2 Trillion, 60% Of Total Bank Capital
    Yesterday, when reporting on the latest development in China’s ongoing under-the-table stealth nationalization-cum-bailoutof insolvent enterprises courtesy of a proposed plan to convert bad debt into equity, we noted that while China has already managed to convert over $220 billion of Non-performing loans into equity, concerns – both ours and others’ – remained. As Liao Qiang, director of financial institutions at S&P Global Ratings in Beijing, said coercing banks to become stakeholders in companies that could not pay back loans will further weigh down profits this year. Instead of underpinning stability at banks, the efforts undermine it. That said, while many have voiced their pessimism about China’s latest attempt to sweep trillions in NPLs under the rug, there had been no comprehensive analysis of just how big the impact on China’s banks, economy or financial system would be as a result of this latest Chinese strategy. Until now.
  • Another Shoe Falls—–U. S. Service Sector Now At Stall Speed
    Markit’s Services PMI fell to just 51.2 in May, dropping a rather large 1.6 points from 52.8 in April. That meant the combined US Composite PMI, which puts together both manufacturing and services, was barely above 50, registering just 50.8. As with all PMI’s the distinction around 50 is unimportant, what matters is the direction and for more than a single month. On that count, services reflect what we have seen in manufacturing: that the “rebound” in March and April was nothing more than a small relative improvement after the liquidation-driven start to the year. The economy didn’t get better, it for a few months just failed to get worse.
  • The Hidden Side of Wall Street’s “Mischief”
    Wall Street gets a bad rap. Much of it is deserved, but not necessarily for the reasons you might expect. You see, to many, Wall Street’s suit-clad warriors appear to be nothing more than money-sucking leeches… draining the pockets of Americans’ hard-earned dollars through their fees, commissions and kick-backs. Whether this is a fair characterization or not, Wall Street’s worst give haters plenty of ammo. About this time last year, the United States Justice Department vowed to fine Wall Street banks something like $5.8 billion for rigging currency and interest rate markets. A long scroll of instant message conversations confirmed that many Wall Street insiders were coordinating this mischief. The most arrogant of the bunch even went so far to pontificate: “If you ain’t cheating, you ain’t trying.”
  • Our National Debt Will Grow to $31 Trillion by 2023
    It just seems like human nature to ruin a good thing. As much as I am a strong proponent of free market capitalism, and against complex regulations and central planning, I understand government’s role in all this. Capitalism and democracy teamed up in the late 1700s to form the big bang in economics, or what I call “When Harry met Sally.” They’re opposites that balance each other – capitalism rewards people for their contributions, and democracy ensures that greed doesn’t take over. We took Adam Smith’s theory of the “invisible hand,” limited government and laissez faire politics… and combined it with Alexander Hamilton’s doctrine of a stronger government to enhance capitalism. We invested in common infrastructures, established a central bank with uniform monetary policies, and implemented financial and legal systems – things free market capitalism can’t do alone. That’s why, together, these two ideologies complement each other – so long as they don’t get in each other’s way.
  • China's Credit-Fuelled Economy Is “Gyrating Like A Spinning-Top That's Out Of Momentum”
    China's hard landing has already begun, warns economist Richard Duncan as the nation's credit-fuelled economic boom ended in 2015 and a protracted slump lies ahead. He has published a series of videos explaining why China’s economic development model of export-led and investment-driven growth is now in crisis leaving “China’s economy resembles a spinning top that is running out of momentum. It is wobbling and gyrating erratically.”
  • The Relationship Between The United States And China Is Officially Going Down The Tubes 
    What happens when the two largest economies on the planet start fighting a trade war with one another?  Well, we are about to find out.  As you will see below, the U.S. has gone “nuclear” on China in a trade dispute over steel, and the Chinese response is likely to be at least as strong.  Meanwhile, events in the South China Sea have brought tensions between the Chinese government and the Obama administration to a boiling point.  The Obama administration strongly insists that China does not have a legal right to those islands, and in China there is now talk that it may ultimately be necessary to confront the United States militarily in order keep control of them.  Most Americans may not realize this, but the relationship between the United States and China is officially going down the tubes, and this is likely to have very significant consequences during the years to come. Let’s start with the trade war that has erupted.  About a week ago, we learned that the Obama administration had decided to “go nuclear” on China by imposing a 522 percent duty on cold-rolled steel from China that is used in certain kinds of manufacturing…
  • The One World Religion Cometh: Pope Francis Warmly Welcomes Top Islamic Cleric To The Vatican
    When Pope Francis met with Sheikh Ahmed al-Tayeb on Monday, he told him that “our meeting is the message“.  So precisely what kind of “message” was Pope Francis attempting to convey?  Sheikh Ahmed al-Tayeb is the Grand Imam of Cairo’s Al-Azhar Mosque, and some have described him as “the highest figure in Sunni Islam“.  The Daily Mail said that the meeting between these two men was a “historic bid to reopen dialogue between the two churches”, and as you will see below this is yet another in a long series of attempts by Pope Francis to build bridges between Catholicism and various other faiths.  In the end, what are we to make of all of this?  Could it be possible that Pope Francis is laying the groundwork for the “super world church” and the coming one world religion that David Wilkerson and so many others have warned about? Pope Francis made sure that when he embraced Sheikh Ahmed al-Tayeb there would be plenty of reporters there to document the moment.  The following is an excerpt from a Daily Mail article entitled “Pope embraces grand imam at historic Vatican meeting in a bid to bring the Catholic and Muslim churches together“…
  • The Market Has Barely Corrected — And That’s A Problem
    The S&P 500 index closed last Friday at exactly 2,052.32 points. This means that for the year, the equities benchmark has only gained 0.6%. In other words, this is a horizontal market. Fundamentally, the blue chips have been stymied by a very tough earnings season. In particular, the laggard that is the retail sector continues to contradict data that the economy is in a recovery mode. Internationally, China's slowdown — both in their exports as well as in their consumer market — has dragged the global economy. But a little appreciated technical factor may be foretelling a sharp correction in the major indices.
  • Big Banks Get More Protection But Not Their Clients
    We have explained how the next worldwide financial crisis will be solved by looting savers’ bank accounts, in order to save the big banks. The European Bank Recovery and Resolution Directive (BRRD) shall take care of that, and the idea is gaining ground in other countries. This will to protect big banks come what may, even if it means ruining their clients, reached a new phase. In the United States the Fed just allowed a defaulting bank to keep its clients’ collateral. In other words, when a fund, such as a hedge fund, transacts with a bank on derivatives, it must put up a guarantee toward said bank, some sort of “collateral”, generally Treasuries, a recognised and liquid asset. This is quite normal since derivatives may generate losses, and the bank wants some insurance. But if that bank is about to implode, it will be allowed to keep that collateral, even though the transaction itself does not generate any losses! This is what the Fed just decided.
  • Saudi Arabia’s Economic Plan Shows It’s Just Not That Into OPEC
    Saudi Arabia, one of the founders of OPEC, is sounding the group’s death knell. The world’s biggest crude exporter has already undermined OPEC’s traditional role of managing supply, instead choosing to boost output to snatch market share from higher-cost producers, particularly U.S. shale drillers, and crashing prices in the process. Now, under the economic plan known as Vision 2030 promoted by the king’s powerful son, Deputy Crown Prince Mohammed bin Salman, the government is signaling it wants to wean the kingdom’s economy off oil revenue, lessening the need to manage prices. Moreover, the planned privatization of Saudi Arabian Oil Co. will make the nation the only member of the Organization of Petroleum Exporting Countries without full ownership of its national oil company.
  • We Have Entered The Looting Stage Of Capitalism — Paul Craig Roberts
    Having successfully used the EU to conquer the Greek people by turning the Greek “leftwing” government into a pawn of Germany’s banks, Germany now finds the IMF in the way of its plan to loot Greece into oblivion. The IMF’s rules prevent the organization from lending to countries that cannot repay the loan. The IMF has concluded on the basis of facts and analysis that Greece cannot repay. Therefore, the IMF is unwilling to lend Greece the money with which to repay the private banks. The IMF says that Greece’s creditors, many of whom are not creditors but simply bought up Greek debt at a cheap price in hopes of profiting, must write off some of the Greek debt in order to lower the debt to an amount that the Greek economy can service.
  • ALERT: Legend Pierre Lassonde Just Predicted Price Of Gold To Soar Above $10,000
    With the price of gold and silver pulling back and consolidating recent gains, today legendary Pierre Lassonde spoke with King World News and predicted for the first time ever that the price of gold will soar above $10,000. Lassonde is arguably the greatest company builder in the history of the mining sector.  He is past president of Newmont Mining, former chairman of the World Gold Council and current chairman of Franco Nevada.  Lassonde is one of the wealthiest, most respected individuals in the gold world, and as always King World News would like to thank him for sharing his wisdom with our global readers during this critical period in these markets.
  • 50-Year Veteran Warns This Twisted Fantasy Is About To Come To A Frightening End
    With the war in the gold and silver markets continuing to rage, today a 50-year market veteran warned this twisted fantasy is about to come to an end. John Embry:  “Eric, this Fantasyworld we are living in gets more ridiculous by the minute.  However, it is not terribly surprising when one considers the depth of the global systemic problems. I thought Egon’s KWN interview was exceptional and should be required reading for anyone who thinks what we are experiencing in markets today is sustainable. When one realizes the powers that be are essentially impotent beyond providing unlimited quantities of liquidity, issuing bogus economic statistics, and manipulating markets in order to create the impression that things are fine, one recognizes that investors can’t be too careful here.  The Dow’s powerful rally today just amps up the volatility for that index and a sharp increase in volatility often proceeds a major change in market direction.  So I think the stock market players best be careful.
  • PUBLIC WORRIED: A Staggering $100 Billion Has Flowed Out Of Stocks So Far This Year
    With continued uncertainty in global markets, two of the greats weighed in with their thoughts on what to expect next as nearly $100 billion has flowed out of the U.S. stock market so far this year. From Art Cashin:  On The Mortality Of Bull Markets – One of the key commentaries going around Wall Street these days begins with “Bulls markets don’t die of old age….” That is then followed by the speaker’s choice of bull market mortality, e.g. euphoria, etc. I wonder if bull markets might die of some other cause, like perhaps starvation. My friend and fellow trading veteran, Jim Brown over at Option Investors cites Bank of America in noting that “year to date equity outflows were approaching $100 billion“. Such outflows had been more than offset by corporate buybacks. Those have now slowed dramatically. Outflows should be watched carefully.
  • Here’s why (and how) the government will ‘borrow’ your retirement savings
    According to financial research firm ICI, total retirement assets in the Land of the Free now exceed $23 trillion. $7.3 trillion of that is held in Individual Retirement Accounts (IRAs). That’s an appetizing figure, especially for a government that just passed $19 trillion in debt and is in pressing need of new funding sources. Even when you account for all federal assets (like national parks and aircraft carriers), the government’s “net financial position” according to its own accounting is negative $17.7 trillion. And that number doesn’t include unfunded Social Security entitlements, which the government estimates is another $42 trillion. The US national debt has increased by roughly $1 trillion annually over the past several years.
  • Peak Petro-State – The Oil World In Chaos
    Pity the poor petro-states. Once so wealthy from oil sales that they could finance wars, mega-projects, and domestic social peace simultaneously, some of them are now beset by internal strife or are on the brink of collapse as oil prices remain at ruinously low levels. Unlike other countries, which largely finance their governments through taxation, petro-states rely on their oil and natural gas revenues. Russia, for example, obtains about 50% of government income that way; Nigeria, 60%; and Saudi Arabia, a whopping 90%. When oil was selling at $100 per barrel or above, as was the case until 2014, these countries could finance lavish government projects and social welfare operations, ensuring widespread popular support.  Now, with oil below $50 and likely to persist at that level, they find themselves curbing public spending and fending off rising domestic discontent or even incipient revolt.
  • 6 Giant Corporations Control The Media, And Americans Consume 10 Hours Of ‘Programming’ A Day
    If you allow someone to pump hours of “programming” into your mind every single day, it is inevitable that it is eventually going to have a major impact on how you view the world.  In America today, the average person consumes approximately 10 hours of information, news and entertainment a day, and there are 6 giant media corporations that overwhelmingly dominate that market.  In fact, it has been estimated that somewhere around 90 percent of the “programming” that we constantly feed our minds comes from them, and of course they are ultimately controlled by the elite of the world.  So is there any hope for our country as long as the vast majority of the population is continually plugging themselves into this enormous “propaganda matrix”?
  • A Spirit Of Violence And Civil Unrest Is Rising In America
    It was only a matter of time before our deeply divided nation was going to start coming apart at the seams.  Waves of anger, frustration, violence and civil unrest are starting to sweep across the United States, and political rallies for Republican presidential candidate Donald Trump have become a focal point for releasing some of that energy.  The angry mob that threw rocks, bottles and burning T-shirts at police and Donald Trump supporters on Tuesday night wanted to get the attention of the national media, and they got it in droves.  Now that the election is less than five months away, this kind of scene is going to be repeated over and over, and this is something that I warned about back in March.  Millions upon millions of our young people have fully embraced the radical left, and they have already made it exceedingly clear that they are not afraid to use violence to advance their cause.
  • Criminal Bankers Threaten Entire World Economy-Helen Chaitman
    Helen Davis Chaitman was the lead attorney representing the victims of the $65 billion Bernie Madoff scam. Madoff had help form JP Morgan Chase Bank, and what she found out was stunning.  Chaitman explains, “JP Morgan Chase was the subject of a criminal complaint . . . it was charged with a criminal violation of the Bank Secrecy Act, which is a felony violation.  JP Morgan Chase disgorged a small percentage of the profits it made on the Madoff relationship, and the government called it quits.  Nobody was fired.  Nobody disgorged bonuses, they just went on doing other crimes.”
  • All Electronic Assets Wiped Out in Fall Crash
    Financial analyst Bix Weir has laid out a timeline for the next financial collapse that he says is underway. Bix explains, “It’s happening now, and it has been happening since the beginning of the year.  Some of the big things on the time line and one of the bigger things to watch is the Deutsche Bank (DB) implosion.  That’s going to be gigantic because Deutsche Bank is the largest derivative holder in the world.  Their stock is plummeting, and they are begging for tier 1 capital.  It’s all happening right now.  The question is what is the day that Deutsche Bank throws up its arms and says we’re insolvent?  We are many times insolvent, and that would just destroy the European markets.  It will also destroy the U.S. markets because our biggest banks are invested in the sovereign debt of European countries.  That’s how it is going to start, and I believe the end of the end will be the Deutsche Bank implosion. . . .This is why Deutsche Bank is paying huge interest rates now because they need to raise their tier 1 capital.  They have to raise tier 1 capital before they report for the second quarter.  They are in massive trouble.  Their tier 1 capital is being destroyed by all these losses and lawsuits.  Didn’t they lose $7 billion euros last year? . . . They need massive amounts of capital . . . and they are willing to pay 5% interest just to get past the second quarter. That’s the amazing thing. . . . Deutsche Bank is going to be gone by the end of the third quarter.”
  • As Boomers Retire, Mom-and-Pop Businesses Convert to Co-ops to Save Jobs
    Susanne Ward and her husband, Patrick Reilley, moved from California to Maine in 1992 with plans of starting their own business. They decided on a used bookstore and coffee house, as they felt both good coffee and good books were in short supply in their new neighborhood. Located in the city of Rockland, Rock City (named for the limestone quarries that fueled the city’s growth in the 1800s) became a focal point in town for the artistic crowd, but Ward and Reilley struggled to find quality coffee that was reasonably priced. Within three years, they’d moved into a bigger space that could house the bookstore, cafe, and a space to roast their own coffee blend, which they began wholesaling. In 1999, they opened a roastery a few blocks south of the cafe outside of Rockland’s historic district, producing and selling their blend, which also supplied Rock City.
  • After Losing $11 Billion on $9.4-billion Nokia Buy & Axing 27,650 Jobs, Microsoft Dumps Consumer Smartphones
    Microsoft entered the final-final or pre-final-final episode of its Nokia saga. Its press release on Wednesday explained that it would “streamline” its smartphone hardware business. It would throw in the towel on smartphones for consumers and try to carve out a niche in corporate smartphones. It would be accompanied by more bloodletting. With its usual big-money genius, Microsoft had acquired Nokia’s mobile-phone business and patents In September 2013. Nokia’s credit rating was junk. Its market share had collapsed. It had lost over $4 billion the prior year. But its smartphones were using the Windows Phones operating system. The original terms of the deal called for a purchase price of $5.4 billion. This soon ballooned to a new purchase price of $7.2 billion. To make the deal go down better, Microsoft promised $600 million in annual cost savings within 18 months.

Precious Metals Are The Only Lifeboat! I have persistently WARNED you what was happening in the gold market and why you needed to convert your paper assets to physical gold and silver by the middle of September 2015. You need to hedge against the financial instability with physical gold and silver. Call the experts to help you convert your IRA or 401k into Gold, Silver and Other Precious Metals. Call GoldCo NOW before it's too late! Call Toll-Free 1-877-414-1385.

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