From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. Please LIKE the Lindsey Williams Online Facebook Page to see stories posted daily regarding the current state of the economy around the world.
Latest News From April 1, 2016 to April 7, 2016:
- U.S. Oil Rig Count Down by 10
The U.S. oil-rig count fell by 10 to 362 in the latest week, according to Baker Hughes Inc., maintaining a trend of declines. The number of U.S. oil-drilling rigs, viewed as a proxy for activity in the sector, has fallen sharply since oil prices began to fall. But it hasn’t fallen enough to relieve the global glut of crude. There are now about 72% fewer rigs of all kinds since a peak of 1,609 in October 2014.
- Automakers post disappointing U.S. sales, still see strong 2016
General Motors Co, Fiat Chrysler Automobiles and other major automakers reported weaker-than-expected U.S. sales for March, hurt by declining demand for sedans and light dealer traffic during the Easter weekend. Sales for the month rose 3 percent to nearly 1.6 million vehicles, or 16.57 million vehicles on an annualized basis, according to industry analyst Autodata Corp. That was well below expectations of a rise of about 7 percent and annualized estimates that ranged from 17 million to 17.5 million by analysts and economists polled by Thomson Reuters.
- Where The March Jobs Were: The Minimum Wage Deluge Continues
In March the US economy added a healthy 215K jobs, beating expectations and more importantly, pushing the average hourly earnings up by 0.3% on the month. Which, however, is curious because a cursory look at the job additions in the month reveals that nearly two-third of all jobs, and the three top categories of all job additions, were once again all minimum wages jobs.
- Gold Rush by Russia Makes Up for Billions Lost in Currency Rout
Here’s why Governor Elvira Nabiullina is in no haste to resume foreign-currency purchases after an eight-month pause: gold’s biggest quarterly surge since 1986 has all but erased losses the Bank of Russia suffered by mounting a rescue of the ruble more than a year ago. While the ruble’s 9 percent rally this year has raised the prospects that the central bank will start buying currency again, policy makers have instead used 13 months of gold purchases to take reserves over $380 billion for the first time since January 2015. The central bank will wait for the ruble to gain more than 12 percent to 60 against the dollar before it steps back into the foreign-exchange market, according to a Bloomberg survey of economists.
- Part-timers might account for labor-force surge
The number of able-bodied Americans entering the labor force has surged since last fall. But in a marked change from earlier in the recovery, more of them are finding jobs right away instead of just looking for work. What’s going on? It’s hard to say for sure, but circumstantial evidence in the latest U.S. jobs report suggests many of these newly employed workers have found part-time work with mediocre pay. The participation rate hit a two-year high of 63% in March, climbing from a 38-year low of 62.4% in September, the government said Friday. A person is considered part of the labor force if he finds or job or is actively searching for one.
- Meet the angry American voter
The angry primary voter is the election year manifestation of a 25-year trend gnawing away at American self-confidence. Call it one America, two economies. The S&P 500 is up more than 200% over the past seven years. Home prices rose 11% last year, and a quarter of housing markets are showing record high home prices. Millions of jobs have been added and the unemployment rate is 4.9%, approaching a level many economists consider full employment.
- Negative Yields, Opportunity Cost and Gold
Last week, I published an article on the causes and consequences of negative interest rates. In it, I talked briefly about how negative yields hold significant implications for gold as an asset class. In this followup article, I will explain why that is.
- U.S. factory data signal further slowdown in GDP growth
New orders for U.S. factory goods fell in February and business spending on capital goods was much weaker than initially thought, the latest indications that economic growth slowed further in the first quarter. The Commerce Department said on Monday new orders for manufactured goods declined 1.7 per cent as demand fell broadly, reversing January’s downwardly revised 1.2 per cent increase. Orders have declined in 14 of the last 19 months. They were previously reported to have increased 1.6 per cent in January.
- JOHN McAFEE: A time bomb is hidden beneath the Panama Papers
John McAfee is running for US president as a member of the Libertarian Party. This is an op-ed he wrote and gave us permission to run. The hack of Mossack Fonseca, in terms of the certain fallout that will affect many of the wealthiest and most prominent people on the planet, is by far the largest and most damaging cyberattack on record. I am just one of more than 200,000 people to have downloaded the Panama Papers, a record for hacked documents. It was a gold mine.
- Stunning Video the world was never supposed to see…
Pastor Williams shared this video, he has said ‘Every American must see this'. This video is a must watch. US Admiral (Ret) James “Ace” Lyons tells what Islam is like.
- Invitation by Pastor Lindsey Williams – From DVD – Elite Plans For 2016
This is an invitation by Pastor Lindsey Williams taken from the DVD ‘Elite Plans For 2016'. Lindsey Williams, an ordained Baptist minister went to Alaska in 1970 as a missionary. For three years Pastor Lindsey Williams had the opportunity to sit, live and rub shoulders with the most powerful, controlling and manipulative men on the face of this planet.
- Donald Trump Is Starting To Sound Just Like The Economic Collapse Blog (And That Is A Good Thing)
Guess what Donald Trump is saying now? Last week, I discussed how Robert Kiyosaki and Harry Dent are warning that a major crisis is inevitable, but I didn’t expect Donald Trump to come out and say essentially the exact same thing. On Saturday, the Washington Post released a stunning interview with Donald Trump in which he boldly declared that we heading for a “very massive recession”. He also warned that we are currently in “a financial bubble” and that “it’s a terrible time right now” to be investing in stocks. These are things that you may be accustomed to hearing on The Economic Collapse Blog, but to hear them from the frontrunner for the Republican nomination is another thing altogether.
- Shots Fired: Wikileaks Accuses Panama Papers' Leaker Of Being “Soros-Funded, Soft-Power Tax Dodge”
Earlier today, for the first time we got a glimpse into some of the American names allegedly contained in the “Panama Papers”, largest ever leak. “Some”, not all, and “allegedly” because as we said yesterday, “one can't help but wonder: why not do a Wikileaks type data dump, one which reveals if not all the 2.6 terabytes of data due to security concerns, then at least the identities of these 441 US-based clients. After all, with the rest of the world has already been extensively shamed, it's only fair to open US books as well.” The exact same question appeared in an interview conducted between Wired magazine and the director of the organization that released the Panama Papers, the International Consortium of Investigative Journalists, or ICIJ, Gerard Ryle.
- Trump: America is headed for a ‘very massive recession’
Donald Trump said in an interview that economic conditions are so perilous that the country is headed for a “very massive recession” and that “it's a terrible time right now” to invest in the stock market, embracing a distinctly gloomy view of the economy that counters mainstream economic forecasts. The New York billionaire dismissed concern that his comments – which are exceedingly unusual, if not unprecedented, for a major party front-runner – could potentially affect financial markets. “I know the Wall Street people probably better than anybody knows them,” said Trump, who has misfired on such predictions in the past. “I don't need them.” Trump's go-it-alone instincts were a consistent refrain – “I'm the Lone Ranger,” he said at one point – during a 96-minute interview Thursday in which he talked candidly about his aggressive style of campaigning and offered new details about what he would do as president.
- ISM New York Drops To September Lows As All Components Decline; Employment Plunges
While last week's Chicago's PMI staged a strong bounce from its recent contraction and back into expansion, New York did not. ISM New York just printed at 50.4, just barely above the contraction point, and the lowest headline print since mid 2015. The extremely noisy time series continues to swing, this time lower, with every single underlying component deteriorating in the month of March.
- Is Trump's “Recession Warning” Really All Wrong?
Over the weekend, Donald Trump, in an interview with the Washington Post, stated that economic conditions are so perilous that the country is headed for a “very massive recession” and that “it’s a terrible time right now” to invest in the stock market. Of course, such a distinctly gloomy view of the economy runs counter to the more mainstream consensus of economic outlooks as witnessed by some of the immediate rebuttals.
- Trade deficit balloons in February
The US trade deficit widened to $47.1 billion in February, the Commerce Department said Tuesday. Economists had estimated that the excess of imports over exports — or the trade deficit — increased to $46.2 from a revised, expanded print of $45.9 billion in the prior month. “So far this quarter imports have rebounded more than exports, which is why we expect trade to subtract from Q1 GDP growth,” said BNP Paribas' Laura Rosner in a note.
- Employment Numbers an April Snow Job
Donald Trump managed to shove his way into the spotlight again last week, claiming the US is heading for “a massive recession.” Unsurprisingly, the mainstream media scoffed at Trump’s assertion, pointing to the “great jobs report” that came out Friday.
- Pfizer Vs. Obama: The Treasury Tries To Stop Pharma's Tax Dodge
Most experts in corporate taxes thought there was little President Barack Obama could do to force Pfizer PFE +5.01%, the largest drug company in the U.S., from moving its corporate address to Dublin, Ireland, in order to escape paying American taxes. Yesterday evening, Jack Lew, Obama’s secretary of the treasury, called Pfizer’s bluff, instituting new rules to make the move as difficult as possible. The punch hit, and investors are reeling. Now the move could intensify an election-year battle over what it means for companies to be American, and the fairness of the U.S. corporate tax code.
- China's yuan set for biggest quarterly gain since Sept 2014
China's yuan is poised for its biggest quarterly gain since September 2014, underpinned by firmer central bank guidance as the country's financial markets continue to stabilise and the dollar loses momentum. Federal Reserve Chair Janet Yellen's cautious view on U.S. rate hikes this week, which dampened views of other Fed colleagues suggesting another increase was imminent, continued to take a toll on the greenback on Thursday.
- Jobless Claims Surge Most In 2 Years As Challenger Warns Of “Significant” Jump In Retail, Computer Layoffs
With both ISM Manufacturing and Services employment indices collapsing, endless headlines of layoffs, Challenger-Grey noting Q1 as the worst since 2009, and NFIB small business hiring weak, it is no surprise that initial jobless claims is finally waking up. For the 3rd week in a row – the longest streak since July 2015. The last 3 weeks have seen a 9.1% surge in jobless claims – the biggest such rise since April 2014.
- Russia on a Gold Buying Spree
The Russians have launched into a gold buying spree. Based on recently released International Monetary Fund numbers reported at Mining.com., the Russian central bank ranked as the world’s leading gold buyer in February, adding 356,000 ounces to its reserves.
- Gold Soars 16% In Q1 – Best Start To A Year In 42 Years
Gold's 16.1% surge in Q1 2016 ias the best start to a year since 1974. Overall, this is the best quarter since Q3 1986 and is the best performing major commodity of the year. Gold rallied this year as it cemented its status as a store of value amid financial market turbulence and concern about the global economy, which led to speculation that the Federal Reserve would pause on tightening monetary policy in the U.S. Having seen BlackRock's gold ETF halted due to inability to meet physical demand, it appears pet rocks and barbarous relics are ‘worth' something after all.
- NY Senate OKs Budget Bill To Boost State Minimum Wage To $15
The Republican-controlled chamber voted 61-1 for the final bill after working through the night to pass other parts of the $156 billion spending plan for the fiscal year that began Friday. “We knew we could lift millions out of poverty if we just stayed focused,” said Sen. Andrea Stewart-Cousins, leader of the Senate’s Democratic minority. “It’s a good day, even if it is a very, very long day.” The Democrat-controlled Assembly, which adjourned early Friday, was set to meet following Friday afternoon briefings to begin debate on the wage bill.
- Dollar logs worst quarter since 2010; buck hits 5-month low vs. euro
The dollar logged its worst quarterly performance in years as the Federal Reserve slowed the expected pace of interest rate hikes, citing worries about the potential domestic impact of anemic growth abroad. As measured by one gauge, the buck is about to register its worst performance during the first quarter of a year since 2008, when the index fell 6.4%, and its worst overall calendar-quarter performance since Sept. 30, 2010, when the gauge dropped about 8.5%.
- “The Cat Is Out Of The Bag” – In Interview Mossack Fonseca Founders Admit It's Over… To Rothschild's Delight
Days before the ICIJ released this weekend's trove of “Panama Papers” international tax haven data involving Panamaian law firm Mossack Fonseca, Bloomberg conducted an interview on March 29 with the two founding lawyers. In it, it found that even before the full leak was about to be made semi-public (any of the at least 441 US clients are still to be disclosed), the Panama law firm knew that the game was already largely over.
- Here Are Some Of The Americans In The “Panama Papers”
With media attention squarely falling on the foreigners exposed by the Panama Papers offshore tax haven scandal, everyone has been asking for more information on who are the Americans involved in this biggest data leak in history. After all, as we showed, Mossack Fonseca had over 400 American clients. But who are they? Today, courtesy of McClatchy, we get some answers: while there are no politicians of note are in files but plenty of others. Among them: Retirees, scammers, and tax evaders, all of whom found a use for secrecy of offshore companies. As the news paper reports, “the passports of at least 200 Americans show up in this week’s massive leak of secret data on secretive offshore shell companies.”
- 2007 All Over Again: “We Are Outsourcing Our Monetary Policy”
Last night we noted the odd “messaging” that was apparent in The PBOC's Yuan fix shifts into and after The Fed and Janet Yellen spoke… Almost as if The Fed had “outsourced its monetary policy” to China once again. But as DollarCollapse.com's John Rubino notes, it appears Janet Yellen has instead outsoured US monetary policy to the financial markets…
- Waiters And Bartenders Rise To Record, As Manufacturing Workers Drop Most Since 2009
On the surface, the March jobs reported was better than expected… except for manufacturing workers. As shown in the chart below, in the past month, a disturbing 29,000 manufacturing jobs were lost. This was the single biggest monthly drop in the series going back to December 2009.
- Global Data: A New Scapegoat for the Federal Reserve
During March 16th’s FOMC meeting, the Fed announced that it would leave interest rates unchanged and scaled back its December projections for higher rates in 2016, 2017, and 2018. The Fed’s backtracking comes just three months after raising interest rates 25 basis points, its first hike since June 2006.
- GAO Has Been Telling Congress that Financial Regulation Is in Disarray for 20 Years
Who could blame the researchers at the Government Accountability Office (GAO) for thinking that responding to Congressional requests for studies on how to repair the nation’s ineffective maze of financial regulation is an exercise in futility. GAO has been spending boatloads of taxpayer money for the past two decades to define the problems for Congress as our legislative branch has not only failed to take meaningful corrective measures but actually made the system exponentially worse through the repeal of the Glass-Steagall Act in 1999.
- EU admits plot for FEDERAL superstate and describes Brussels attacks as an ‘opportunity'
Gianni Pitella, leader of the socialist group in the European Parliament, claimed the attack's on the Belgian capital's metro system and airport showed the need for even closer intergration of the 28 member nations of the bloc. He also called for a “European Intelligence Agency” to be set up to strengthen the EU's defences against extremists. Critics warned that his outburst laid bare the ambitions for an European super-state held by many EU supporters and highlighted the long-term dangers of Britain staying tied to Brussels. Mr Pitella's remarks came in an interview with the EU news website Euractiv.
- Big Brother Rising: US Turns Into Full-Blown ‘Surveillance State'
The recent revelation that the NSA has plans to share intercepted private communications with other domestic intelligence agencies has caused a massive backlash, with many viewing the shift as “unconstitutional.” Two experts join Radio Sputnik’s Brian Becker to discuss if the policy is just a “giant fishing expedition for law enforcement.”
- This is how World War III starts—it will be financial
In his History of the Peloponnesian War, ancient Greek historian Thucydides told us the tale of a dominant regional power (Sparta) that felt threatened by the rise of a competing power (Athens). Sparta felt so threatened, in fact, that all the moves they made to keep the Athenian rise in check eventually escalated the power struggle into an all out war. Modern political scientists call this the Thucydides Trap.
- Trend Forecaster’s Dire Warning: Massive Crash Will Wipe 12,000 Points Off Dow Jones By Late 2017
Trend forecaster and demographic researcher Harry Dent says we are in a massive bubble. And as he explains in his latest interview with Future Money Trends, central banks around the world continue to fuel this bubble with unlimited fiat money printing. The end result according to Dent? The biggest bubble burst in history… and it’s coming soon.
- Corporate Media Gatekeepers Protect Western 1% From Panama Leak
Whoever leaked the Mossack Fonseca papers appears motivated by a genuine desire to expose the system that enables the ultra wealthy to hide their massive stashes, often corruptly obtained and all involved in tax avoidance. These Panamanian lawyers hide the wealth of a significant proportion of the 1%, and the massive leak of their documents ought to be a wonderful thing. Unfortunately the leaker has made the dreadful mistake of turning to the western corporate media to publicise the results. In consequence the first major story, published today by the Guardian, is all about Vladimir Putin and a cellist on the fiddle. As it happens I believe the story and have no doubt Putin is bent.
- Panama Papers: Revelations show sheer scale of UK links to off-shore tax havens
The UK government’s pledge to crack down on off-shore tax schemes and money laundering has been laid bare after the majority of firms implicated in a huge leak were shown to be registered in British-administered tax havens. Dubbed the Panama Papers, the unprecedented release maps how a global elite of one-percenters has hidden assets, dodged sanctions and evaded taxes over the last 40 years. More than half of the 300,000 firms, believed to have used a single, secretive Panama-based law firm, are registered in British-administered tax havens. Second only to Hong Kong, 1,900 British firms, including banks, law firms, and company incorporators, feature as “intermediaries” between Mossack Fonesca and its clients.
- Putin and the ‘Dirty Dozen': 11million leaked documents reveal how TWELVE world leaders – plus Russian leader's inner circle, British politicians and Lords – hide their millions in tax havens
The biggest financial data leak in history has revealed how Vladimir Putin's inner circle and a ‘dirty dozen' list of world leaders are using offshore tax havens to hide their wealth. A host of celebrities, sports stars, British politicians and the global rich are all implicated in the so-called Panama Papers – a leak of 11million files which contain more data than the amount stolen by former CIA contractor Edward Snowden in 2013. Documents were leaked from one of the world's most secretive companies, Panamanian law firm Mossack Fonseca, and show how the company has allegedly helped clients launder money, dodge sanctions and evade tax. Megastars Jackie Chan and Lionel Messi are among the big names accused of using Mossack Fonseca to invest their millions offshore. And the Panama Papers also reveal that the £26million stolen during the Brink's Mat robbery in 1983 may have been channelled into an offshore company set up by the controversial law firm.
- Panama Papers: David Cameron's father ‘ran offshore fund that paid zero UK tax for 30 years'
David Cameron’s father was allegedly involved in hiring what has been called a small army of Bahamas residents – including a part-time bishop – to sign paperwork for an offshore fund in what may have been an effort to avoid paying UK tax.
- ‘Panama Papers' leak of 11m documents reveals how the super rich hide their money
The largest ever leak of documents has revealed how an offshore law firm has helped its clients to hide their money in tax havens. Dubbed the “Panama Papers”, the 11 million confidential documents from Mossack Fonseca show how the Panama-based firm has used shell companies to benefit the world’s rich and powerful. Some clients have laundered money, dodged sanctions and evaded tax.
- Corporate Debt Defaults Explode To Catastrophic Levels Not Seen Since The Last Financial Crisis
If a new financial crisis had already begun, we would expect to see corporate debt defaults skyrocket, and that is precisely what is happening. As you will see below, corporate defaults are currently at the highest level that we have seen since 2009. A wave of bankruptcies is sweeping the energy industry, but it isn’t just the energy industry that is in trouble. In fact, the average credit rating for U.S. corporations is now lower than it was at any point during the last recession. This is yet another sign that we are in the early chapters of a major league economic crisis. Yesterday I talked about how 23.2 percent of all Americans in their prime working years do not have a job right now, but today I am going to focus on the employers. Big corporate giants all over America are in deep, deep financial trouble, and this is going to result in a tremendous wave of layoffs in the coming months.
- The New Part-Time Job: “Get Paid $15 An Hour To Protest At The Trump Rally”
For those wondering why Trump rallies tend to devolve to pugilistic matches, where even belligerent 15-year-old protesting (or perhaps “provocative” is a better word) girls end up getting pepper sprayed much to the media's fascination, the answer is Craig's List ads such as the one below, in which allegedly “I'm feelin' the Bern”-affiliated organizers provide paid positions for protesters at Trump rallies, and which provide not only shuttle buses, parking, and signs (as well as time cards) but also hand out $15/hour (as a “part-time employment”) for said protest activity “due to the economic inequality.”
- Japan Goes Neocon – Dumps Antiwar Constitution
Last September the Japanese Diet (parliament) passed legislation “reinterpreting” the nearly 70 year old strictly antiwar constitution to allow for the Japanese military to take part in overseas military operations not directly tied to the defense of Japan. Tens of thousands of Japanese took to the streets this week to protest the enactment of this new law. Will Japanese Prime Minister Shinzo Abe's desire to be part of Washington's “pivot to Asia” lead to a fundamental change in Japan's position in the region?
- Does The United States Still Exist? — Paul Craig Roberts
To answer the question that is the title, we have to know of what the US consists. Is it an ethnic group, a collection of buildings and resources, a land mass with boundaries, or is it the Constitution. Clearly what differentiates the US from other countries is the US Constitution. The Constitution defines us as a people. Without the Constitution we would be a different country. Therefore, to lose the Constitution is to lose the country. Does the Constitution still exist? Let us examine the document and come to a conclusion.
- Bernanke on the Fed’s Next Move
When it comes to anticipating Federal Reserve policy, there’s no better place to turn than former Fed Chair Ben Bernanke. No longer bound by an office, Mr. Bernanke is now free to write about monetary policy as an outsider. In a recent two-part post, the former Fed Chair took some time to explain what tools the Fed has left, and where they might turn in the case of another economic downturn. Why is this important? Because many believe the Fed’s hands are now tied as a result of short-term rates being near zero, and the Fed’s balance sheet sitting at over $4 trillion.
- CITI: The ‘Uber moment' for banks is coming — and more than a million people could lose their jobs
Banks are quickly approaching their “automation tipping point,” and they could soon reduce headcount by as much as 30%. That's according to a new Citi Global Perspectives & Solutions (GPS) report on how financial technology is disrupting banks. “Banks' Uber moment will mean a disintermediation of bank branches rather than the banks themselves,” the report said.
- Deflation Welcome! Lower Third of Population Goes Deeper in Debt, Cannot Afford Any Price Increases
A new PEW study on Household Incomes and Expenditures goes a long ways towards explaining why economists who expected a big jump in consumer spending based on falling gasoline prices were dead wrong. The study shows that although expenditures recovered from the downturn, income did not. Also, low-income families spent a far greater share of their income on core needs, such as housing, transportation, and food, than did upper-income families. Households in the lower third spent 40 percent of their income on housing, while renters in that third spent nearly half of their income on housing, as of 2014.
- The Eurogroup Made Simple
The Eurozone is the largest and most important macro-economy in the world. And yet, this gigantic macro-economy features only one institution that has legal status: the European Central Bank, whose charter specifies what powers the Frankfurt-based institution has in its pursuit of a single objective: price stability. Which leaves the question begging: “What about economic goals, beyond price stability, like development, investment, unemployment, poverty, internal imbalances, trade, productivity?” “Which EU body decides the Eurozone’s policies on these?”
- 7 Million at Risk from Man-made Quakes
Interesting Vox article on natural and manmade earthquakes my fellow Vet and cohort in writing Mark Jamison sent me. This year for the first time ever the USGS is including a map of areas in the US which may be prone to human-induced earthquakes” in addition to areas which are prone to natural earthquakes.
- “Spike in Defaults”: Standard & Poor’s Gets Gloomy, Blames Fed
Credit rating agencies, such as Standard & Poor’s, are not known for early warnings. They’re mired in conflicts of interest and reluctant to cut ratings for fear of losing clients. When they finally do warn, it’s late and it’s feeble, and the problem is already here and it’s big. So Standard & Poor’s, via a report by S&P Capital IQ, just warned about US corporate borrowers’ average credit rating, which at “BB,” and thus in junk territory, hit a record low, even “below the average we recorded in the aftermath of the 2008-2009 credit crisis.”
- IBM Laying Off 1000 Workers In Germany
In recent weeks, the stock of IBM has staged a dramatic rebound surging from a February 11 low of $118 to $150 today, on what we previously assumed had to be another long-overdue bout of stock buybacks. However, for that to make sense, the company – already at risk of being downgraded if it did not take further cost-cutting measures to offset the additional debt interest expense – would need to engage in another round of mass layoffs. This is precisely what happened moments ago when Germany press reported that Big Blue is cutting some 1000 jobs in Germany.
- U.S. Home Prices Are 14% Overvalued According To Bank of America
There has been an odd shift when it comes to US sentiment toward home ownership: while in the past, the higher home prices rose the greater the demand was for housing (leading ultimately to the housing debt bubble of 2006), this time around we are getting increasingly more frequent indications of just the opposite. Some have started to notice: as we noted one week ago, in its traditionally cheerful assessment of the US housing market, the NAR's Larry Yun snuck in an unexpected warning.
- First Ocean Freight Rates Collapse to “Zero,” China Freight Index Plunges to Record Low, Bailouts Loom
The amount it costs to ship containers from China to ports around the world has plunged to historic lows. As container carriers are sinking deeper into trouble, whipped by lackluster global demand and rampant oversupply of container ships, they’re escalating a brutal price war with absurd consequences.
- This Shows Financial Reality Has No Place in Today’s Markets
The shares of OHL Mexico, the Mexican subsidiary of Spanish construction behemoth OHL, soared over 10% to 26.72 pesos on Monday morning. It was the stock’s biggest climb in over 8 months. The reason for the market’s new-found enthusiasm for the shares was somewhat counter intuitive: the company had just announced that it had been hit by the biggest fine ever imposed by Mexico’s securities authority, the CNBV. The company had been penalized for irregular accounting practices and was forced to pay 71.7 million pesos in damages — a $4-million slap on the wrist.
- Peter Boockvar Warns Western Central Planners Are In Now Deep Trouble
Outside of another round of Pavlov’s (Yellen’s) panting dog (markets) getting more food, a few things were firmly established yesterday. Firstly, it really doesn’t matter what any regional Fed President says, especially those that don’t vote as Yellen is clearly the boss and what she wants is what she’ll get…
- Solid Sale Of 7 Year Paper Ends Streak Of Poor Treasury Auctions
Following two disappointing auctions earlier this week when first the 2Y and then the 5Y auctions either demonstrated a substantial drop off in bid-side interest or priced wildly through the when issued, we said to await today's 7Y auction for the true picture of demand for primary paper, as the first auction took place when Europe was out for Easter vacation, and the second one took place just as Yellen speaking at the Economic Club yesterday.
- Attention President Obama: One Third Of U.S. Households Can No Longer Afford Food, Rent And Transportation
While the Fed has long been focusing on the revenue part of the household income statement (which unfortunately has not been rising nearly fast enough to stimulate benign inflation in the form of nominal wages rising at the Fed's preferred clip of 3.5% or higher), one largely ignored aspect of said balance sheet has been the expense side: after all, for any money to be left over and saved, income has to surpass expenses. However, according to a striking new Pew study while household spending has returned to pre-recession levels (the average household spent $36,800 in 2014) incomes have not.
- Doug Casey and the War on Cash: “We Are Truly on the Edge of a Precipice”
Recently, my friend and colleague Louis James, editor of International Speculator, sat down with Doug Casey to discuss the ongoing “War on Cash.” Doug reveals what people looking to protect their money should do. As the War on Cash has gone into overdrive lately, this is a timely discussion that you’ll find below.
- How Have Hedge Funds Been Affected By Oil Prices?
After suffering large losses in 2014, trying to find a bottom in crude oil, the hedge fund industry wizened up: In 2015, it reduced its weightage to the energy sector to the lowest levels since 2008, saving themselves from profound losses when crude hit new 12-year lows—levels not seen since 2004. It was a short-lived euphoria, however, as most missed the stellar run in crude from the lows and are scrambling to enter after the rebound.
- Job Growth Doesn’t Mean We’re Getting Richer
In response to recent claims by the Obama administration and others that “millions of jobs” have recently been created, I examined the data here at mises.org to see if the claims were true. It turns out that job growth since the 2008 recession has actually been quite weak, and hardly something to boast about. Nevertheless, our conclusions from these analyses tend to rest on the idea that job growth is synonymous with gains in wealth and economic prosperity. But is that a good assumption? In an unhampered market, the answer would be no, for several reasons.
- Greece Demands Explanation From IMF Over Leaked Transcript
Greek politicians wasted no time in seeking a response from the IMF over the leaked transcript released earlier today by Wikileaks suggesting the IMF may threaten to pull out of the country's bailout as a tactic to force European lenders to more offer debt relief, and which according to the Greek government was “interpreted as revealing an IMF effort to blackmail Athens with a possible credit event to force it to give in on pension cuts which it has rejected.” According to Reuters, “Greece demanded an explanation from the International Monetary Fund on Saturday after an apparent leaked transcript suggested the IMF may threaten to pull out of the country's bailout as a tactic to force European lenders to more offer debt relief.”
- Wikileaks Reveals IMF Plan To “Cause A Credit Event In Greece And Destabilize Europe”
One of the recurring concerns involving Europe's seemingly perpetual economic, financial and social crises, is that these have been largely predetermined, “scripted” and deliberate acts. This is something the former head of the Bank of England admitted one month ago when Mervyn King said that Europe's economic depression “is the result of “deliberate” policy choices made by EU elites. It is also what AIG Banque strategist Bernard Connolly said back in 2008 when laying out “What Europe Wants”
- Price Controls May Be On the Way
If you thought negative interest rates were as bad as it could get with central banks, you might be in for a surprise. Central banks have been so spectacularly unsuccessful with their accommodative monetary policies that they are discussing pulling out all the stops to get the results they want. They fail to realize that the reason prices aren’t rising is because they really want and need to fall. Bad debts weren’t liquidated during the last financial crisis, the debtors were merely bailed out. Overpriced assets weren’t allowed to be reduced in price. Central banks pumped trillions of dollars into the economy to attempt to paper over the recession. Market forces want to drive prices down, while central banks attempt to prop them up. So what to do when central banks aren’t getting their way?
- Relative Strength in Silver
Gold went down (as the muggles would measure it, in dollars). It dropped almost 40 bucks. Silver fell almost 60 cents. Since silver fell proportionally farther than gold, the gold-silver ratio went up. Why do we keep reiterating that gold goes nowhere, that it’s the dollar which mostly goes down over long periods of time and sometimes up as in 2011-2015? Why do we insist that the dollar be measured in gold, and that gold cannot be measured in dollars the way a steel meter stick cannot be measured in rubber bands? Some ideas that are impossible to understand using the dollar paradigm. For example, gold is in the process of withdrawing its bid on the dollar. This will have devastating consequences, which the word “reset” does not begin suggest. If the dollar is money, then this assertion — gold bids on the dollar — is incomprehensible. However, if gold is money then that makes the dollar just the irredeemable scrip issued by the Fed in order to finance its purchase of Treasury bonds. Who would be eager to trade his money to buy such scrip?
- The Pitfalls of Currency Manipulation – A History of Interventionist Failure
Readers may recall that the last G20 pow-wow (see “The Gasbag Gabfest” for details) featured an uncharacteristic lack of grandiose announcements, a fact we welcomed with great relief. The previously announced “900 plans” which were supposedly going to create “economic growth” by government decree seemed to have disappeared into the memory hole. These busybodies deciding to do nothing, is obviously the best thing that can possibly happen.
- Gerald Celente Issues Trend Forecast For Gold As Global Economy Falters
For several days, gold prices fell on hawkish comments from a number of regional Federal Reserve Bank presidents signaling support for an interest-rate rise, pointing to a possible increase at the upcoming Federal Open Market Committee meeting in late April. They reasoned, as has President Obama and the establishment business media, that anyone questioning the strength of the US economy was “peddling fiction,” and that a Fed rate hike, the second since 2006, was in order…
- ALERT: Important Update On The War That Is Raging In The Gold & Silver Markets
The commercial shorts are now at a level (real-time) that raises serious concern. In fact, the commercials are close to one of their largest short positions in history. The last time the commercials held this large of a short position in silver was in 2008. Again, that does not mean that the price of silver cannot head significantly higher in the short-term.
- Americans Have Been Turned Into Peasants – Time To Fight Back?
In the 1970’s, Goldman Sachs CEO Gus Levy famously encouraged his employees to be “long-term greedy.” In order to understand how far we have fallen as an economy and culture, it’s important to understand the meaning of the phrase and reflect upon it. “Long-term greedy” implies two very important principles that define a well functioning and ethical free market economy. First, is the unrepentant belief that earning a good profit and striving for financial success is a reasonable and admirable goal for both individuals and corporations. Second, is the understanding that such financial success should be earned, not stolen. If one’s focus is the long-term, the implication is that you’re committing yourself to building something real, and that the marketplace will ultimately reward you handsomely for your product or service.
- Is A Gas War Between The U.S. And Canada About To Start?
The United States and Canada work well together. The countries share the world’s largest and most comprehensive trade relationship, exchanging more than $2 billion per day in goods and services; the U.S. is Canada’s largest foreign investor and Canada is the third-largest foreign investor in the U.S. The partnership clearly isn’t broken, but it may need some mending as bilateral and international gas trade stands to complicate matters in short order.
- Why the Fed rate talk was ‘a bunch of nonsense'
The Federal Reserve was never hiking rates four times this year. Investors didn't believe it, and now Fed Chair Janet Yellen has all but explicitly acknowledged it. Indeed, Yellen's blockbuster speech Tuesday assuring that the central bank would go slowly on future adjustments to monetary policy only caught some of the market by surprise. Others realized there was virtually no chance of a hawkish Fed in 2016. “Central bankers at the Fed bark but they won't bite,” Peter Schiff, frequent Fed critic and founder of Euro Pacific Capital, told CNBC.com. “I knew all that talk was a bunch of nonsense.”
- Emerging-Market Currencies Set for Best Month in 18 Years on Fed
It’s been at least 18 years since emerging-market currencies had it this good as the Federal Reserve adopted a gradual approach to its rate-increase cycle, fueling optimism that capital inflows can be sustained. A Bloomberg gauge of 20 currencies gained for a fourth day after Fed Chair Janet Yellen said that policy makers would act “cautiously” as they look to raise borrowing costs. Stocks rallied, sending shares in Shanghai up the most in a month, while South African equities rebounded from a two-week low and Russia ended the longest run of losses since 2011. The premium investors demand to hold emerging-market debt dropped from the highest since March 16.
- Central Bank Policy Sparking Gold Demand in Europe
When we talk about increasing gold demand, the focus tends to fall on Asia. Earlier this week, we reported surging investor demand for the yellow metal in China. The Japanese have also gone on a gold buying spree since that country’s central bank plunged interest rates into negative territory. But it isn’t just Asians who are bullish on gold. Analysts say they see signs of growing demand for the metal in Europe as well.
- Boeing to Cut More Than 4,500 Jobs
Boeing Co. on Tuesday said it planned to cut more than 4,500 jobs by June, as the company accelerates cost-cutting efforts to keep pace with customers demanding less expensive jetliners. The cuts come even as Boeing has booked record orders for its jets and is increasing production of its single-aisle and twin-aisle aircraft. But the company has been losing market share to rival Airbus Group SE. Boeing’s commercial unit expects to cut about 2,400 positions by attrition and around 1,600 through voluntary layoffs, a company spokesman said. This includes the culling of “hundreds” of managers and executives, some through involuntary layoffs.
- Dollar Falls to Five-Month Low on Slower Fed Rate Path Outlook
The dollar fell to a five-month low against the euro on speculation the Federal Reserve will take a slower path to higher interest rates as the central bank factors in headwinds from slowing global economic growth. A gauge of the U.S. currency headed for the biggest quarterly loss since 2010 after Fed Chair Janet Yellen said Tuesday the central bank will act “cautiously” as it looks to withdraw monetary stimulus. The greenback has fallen against all of its 31 major peers in March with Russia’s ruble and Brazil’s real posting the biggest gains, helping emerging-market currencies to their best month in 18 years.
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From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. Please LIKE the Lindsey Williams Online Facebook Page to see stories posted daily regarding the current state of the economy around the world.
Latest News From March 25, 2016 to March 31, 2016:
- Negative Interest Rates: Causes, Consequences and Ramifications
Central Banks are under the mistaken belief that negative interest rates could be the magic kiss which turns their toad economics into Prince Charmings. Why exactly do they think this? What makes Draghi, Kuroda, and others think imposing negative interest rates will stimulate credit and lending in their respective economies? It is important to understand the logic behind this historic moment in global monetary history. Negative interest rates are unprecedented and show how far we have gone off course in terms of policy related to money and credit markets. They are already having a tremendous effect in several European countries and Japan, and they may eventually be coming to the US. Negative rates hold significant future implications for gold as well.
- SunEdison shares tumble 55% on bankruptcy filing fears
Shares of renewable power firm SunEdison plummeted 55% Tuesday as it teetered on the edge of bankruptcy amid slumping oil prices and swirling questions over the company's accounting practices. SunEdison faces a “substantial risk” of bankruptcy, according to the U.S. Securities and Exchange Commission filing by a subsidiary, TerraForm Global. SunEdison develops, installs and operates alternative energy projects.
- 23 Percent Of Americans In Their Prime Working Years Are Unemployed
Did you know that when you take the number of working age Americans that are officially unemployed (8.2 million) and add that number to the number of working age Americans that are considered to be “not in the labor force” (94.3 million), that gives us a grand total of 102.5 million working age Americans that do not have a job right now? I have written about this before, but today I want to focus just on Americans that are in their prime working years. When you look at only Americans that are from age 25 to age 54, 23.2 percent of them are unemployed right now. The following analysis and chart come from the Weekly Standard…
- Dallas Fed Respondent Sums It Up: “Anyone Saying We're Not In Recession Is Peddling Fiction”
Headlines will crow of the seasonally-adjusted ‘beat' of expectations for the Dallas Fed survey (-13.6 vs -25.8 exp) but this is the 15th month in contraction (below 0) – something only seen in recession. Scratching below the surface we see employees, workweek, and capex all in contraction and forward expectations for new orders and employment tumbled. Perhaps that reality is what drove one respondent to rage, “anyone who says the economy is not in recession is peddling fiction.”
- Q1 GDP Crashes To 0.6%: Latest Atlanta Fed Estimate
Earlier today we said that following the abysmal January spending data revision that “the Atlanta Fed will have no choice but to revise its Q1 “nowcast” to 1.0% or even lower, which would make the first quarter the lowest quarter since the “polar vortex” impacted Q1 of 2015, and the third worst GDP quarter since Q4 2012. It means one-third of already low Q1 GDP growth has just been wiped away.” It was “even lower.”
- US Goods Trade Balance: Exports Stabilise at Low Levels
There was a small recovery in exports for February, which offers some hope that the sector has bottomed out. The latest US trade deficit for goods increased slightly to US$62.9bn for February, from a revised US$62.2bn the previous month and was slightly above the consensus US$62.4bn. Compared with February 2015, there was a widening of over US$7bn in the deficit.
- Chinese Seizing Golden Opportunity; Gold Demand Surging
Generally speaking, rising prices tend to temper demand, but when it comes to gold in China, the recent price rally has created the opposite effect. As the Wall Street Journal put it, “Chinese investors see a golden opportunity.” Demand for gold has surged in China over the last several weeks, during a period generally considered out of season. And it’s not typical Chinese jewelry purchases driving the demand. Chinese investors are buying gold coins and bars.
- Seven years after the Great Recession, some Chicago suburbs may never recover
Mitchell and Loria Versher say they were looking for one thing when they bought their first home in South suburban Markham: “Stability.” They might have been better off buying swampland in Florida. In retrospect, July 31, 2007, was a bad day to go shopping for property anywhere. But the modest 900-square-foot Cape Cod-style home the Vershers bought that day for $137,000, on the eve of the worldwide credit crunch, has fared especially badly, by any standard.
- How They Brainwash Us — Paul Craig Roberts
Anyone who pays attention to American “news” can see how “news” is used to control our perceptions in order to ensure public acceptance of the Oligarchy’s agendas. For example, Bernie Sanders just won six of seven primaries, in some cases by as much as 70 and 82 percent of the vote, but Sanders’ victories went largely unreported. The reason is obvious. The Oligarchy doesn’t want any sign of Sanders gaining momentum that could threaten Hillary’s lead for the Democratic nomination.
- Heidi Cruz: Her Evil Past Is Now Being Revealed
While I am aware that Heidi Nelson Cruz apparently does suffer from deep depression, just after Hillary Rodham Clinton, she is the next person to be feared the most in this presidential race for 2016. Yes, I believe in common decency, but I also stand for the dignity of women, which means that they must be respected and treated equally even if it requires the truth. In an article written by Jesse Byrnes for The Hill that was released today on March 25, 2016, under the title “Trump aide fulfills threat to ‘spill the beans' on Heidi Cruz,” he reports on the recent interview on MSNBC that Steve Kornacki had with Katrina Pierson who is an aide for Donald Trump.
- Chemtrail Flu: Have You Got It Yet?
Pastor Williams: ‘There is a near epidemic going on in America.' ‘You’re sick. Your nose is stuffy. Your body aches, You’re sweaty, coughing, sneezing and you don’t have enough energy to get out of bed. It’s not the flu. It’s a conspiracy, according to Dr. Len Horowitz. His opinion is not based on conspiracy theory but on conspiracy fact. Over the past 10 years, Horowitz has become America’s most controversial medical authority. A university-trained medical researcher, Horowitz, 48, charges that elements of the United States government are conspiring with major pharmaceutical companies to make large segments of the population sick. The mainstream media is reporting that hospital emergency rooms are jammed with patients suffering from a bizarre upper respiratory infection that doesn't quite seem like a virus. They are reporting that it’s a “mystery” flu and that the flu vaccines are ineffective against it. “That’s all hogwash, bogus nonsense”, says Dr. Leonard Horowitz.
- HARRY DENT: Civil unrest is coming to America
I made a confession to our Boom & Bust subscribers last month. While I generally advise against owning most real estate, I have a secluded property in the Caribbean. It's the only property I own (I rent my home in Tampa), and I know for a fact that its value will probably depreciate in the great real-estate shakeout I see ahead, though most likely by half as much as a high-end property in Florida. I own this property because I see rising chances for civil unrest in the inevitable downturn ahead, especially in the US. I want a place to go if things get really bad, and it looks increasingly likely that they will. The evidence for that is piling up in this year's presidential race.
- Is This The Debt Jubilee?
Not so long ago the financial world viewed certain numbers as limits beyond which lay trouble. Interest rates near zero, for instance, were thought to risk destabilizing the banking system. And government fiscal deficits above 3% were considered so dangerous that exceeding this level was prohibited by the Maastricht treaty that all eurozone members were required to sign. Those numbers — 0% and 3% — are still considered bad. But now for the opposite reason: They’re insufficiently aggressive. A big part of the world, as everyone now knows, operates with negative interest rates. And prominent economists are urging even greater negativity as a way to make government debt profitable and get people borrowing and spending again.
- Empty Buildings and Wasted Debt: The Chinese Economic “Miracle”
There’s no doubt that the Chinese economic miracle is real. When you move 500 million people from rural to urban settings, taking them from small farms and putting them in a specialized labor force, the economic dividend is massive. That’s how you keep GDP growing more than 7% for 25 years. But along the way, they wanted more. Beyond building factories and housing for new arrivals, local politicians started building massive, wasteful projects. Political meeting halls… Unused apartment buildings… Empty shopping malls… Part of it might have been poor economic planning, but a bigger, and more common, problem was at work.
- Global Economy Dying Pig-No More Rate Hikes-Rob Kirby
Macroeconomic researcher Rob Kirby predicted the Federal Reserve’s interest rate increase late last year “would be one and done.” Kirby explains, “They had no business raising rates in the first place because the economy was not exhibiting enough strength to warrant any rate raises whatsoever, and there won’t be any more interest rate raises because the economy continues to roll over. Doctored economic data cannot make the sick pig that the global economy really is look any better. It doesn’t matter how much lipstick you put on that dying pig. It’s still a dying pig.”
- Mitsui Sees First Loss Since 1947 Amid $2 Billion Writedown
Mitsui & Co., Japan’s second biggest trading house, forecast its first net loss since it was founded in its modern form in 1947 due to impairment charges on mining and energy projects from South America to Australia. The Tokyo-based trading house expects a net loss of 70 billion yen ($623 million) in the fiscal year ending March after booking impairment charges of 225 billion yen on assets including the Browse LNG project in Australia and the Caserones copper development in Chile, according to a statement Wednesday. Mitsui previously forecast net income of 190 billion yen.
- This Game’s Almost Over: Central Banks Are Running Out Of Options
Going into last week’s Fed meeting, the general consensus was that they would not raise rates. When they hiked rates by a quarter point in December, they projected there would be four additional quarter-point raises in 2016. That’s starting to look fishy as we’re almost a quarter of the way through the year and there’s still no hike. Sure enough, the Fed left rates unchanged as expected last week, and revised their rate expectations lower through 2016. Now, they anticipate only hiking another half point by the end of the year.
- The reserve currency curse
Is reserve currency status a blessing or a curse? The answer might seem obvious, as reserve currencies have been shown to confer lower borrowing costs on their issuers. But what of the borrower who, enticed by low interest rates, borrows more than they can pay back? Naturally the result will be a default. However, for the issuer of a reserve currency that is unbacked by a marketable commodity, such as gold, in the event that they borrow too much, they can just print more reserves. While this avoids default indefinitely, it also hollows out the economy, erodes the capital stock, reduces the potential growth rate and, eventually, leads to a dramatic devaluation of the currency and loss of reserve status. History has not been kind to countries that have followed this path, nor to their financial markets. In my view, the grave investment risks associated with the possible eventual loss of the dollar’s reserve status are not priced into financial markets.
- Well That Didn’t Work
The Bank of Japan and European Central Bank eased recently, which is to say they stepped up their bond buying and/or pushed interest rates further into negative territory. These kinds of things are proxies for currency devaluation in the sense that money printing and lower interest rates generally cause the offending country’s currency to be seen as less valuable by traders and savers, sending its exchange rate down versus those of its trading partners. This was what the BoJ and ECB were hoping for — weaker currencies to boost their export industries and make their insanely-large debt burdens more manageable.
- Belgium Terror Just the Beginning of Insecure World-Egon von Greyerz
Financial expert Egon von Greyerz (EvG) says terror attacks, like the one that just happened in Brussels, can destabilize the entire world. EvG, who lives in Switzerland, explains, “This is obviously a very sad day for our friends in Belgium, but at the same time, we know this is just the beginning, not only in Europe, but with the whole world. We are going to see a much more insecure world. It is worldwide. We know that the refugee problem has included a number of potential terrorists. . . . The problems that will be in the west were created by the U.S. and Europe. The problems that were created in the Middle East and North Africa will lead to more of this. There is anarchy in Libya. There is anarchy in Iraq, and the West has created this. So, they are paying us back, and I don’t think this is finished. We will see a less secure world, and it is not just Europe. The U.S. will see similar problems.”
- Central Banks Move Into Crypto-Currencies As Part Of Cashless Society Hustle
Top UK Telegraph journo Ambrose Evans-Pritchard just wrote about this planned crypto-currency in what is either an incredibly stupid and uneducated article or pure propaganda… it was titled “Central banks beat Bitcoin at own game with rival supercurrency.” The article is horrible central bank happy-talk that reads like the Bank of England wrote it for him and starts off with a blatant lie only three words in… this new RScoin, put out by the central bank of England, has not BEAT bitcoin. It is worse in every imaginable way than bitcoin… right down to the name. RScoin… central banker types aren’t exactly the most creative. We’ll call it FiatCoin around here.
- Lloyd's of London Takes `Massive Hit' From Low Returns
Lloyd’s of London reported a 30 percent drop of full-year profit as the world’s largest insurance market was hurt by continued pressure on pricing and the lowest investment returns since at least 2001. Earnings declined to 2.1 billion pounds ($3 billion) for 2015 as income from investments, primarily in fixed income, sank 60 percent to 400 million pounds with the majority earned in the first half of the year, according to the company’s annual report Wednesday. Weaker insurance pricing in 2015 is expected to continue this year, hurting profitability. “We’ve taken a double hit from reduced margins in underwriting and lower investment yield,” Chief Executive Officer Inga Beale said in an interview with Bloomberg Television Wednesday. “On the investment side we saw a dramatic reduction in 2015 that was a massive hit” to earnings.
- Economic Collapse: Marc Faber Issues Dire Warning for America
U.S. on Verge of Economic Collapse, Says Marc Faber. Adding more emphasis on his belief that the U.S. is on the verge of an economic collapse, perma-bear investor Marc Faber advised retail investors not to put money in U.S. stocks; instead, according to Faber, investors should pour their funds into emerging market equities. The publisher of The Gloom, Boom & Doom Report newsletter told Bloomberg that U.S. stocks are highly priced by several measures, including price-to-sales, price-to-earnings, and market cap-to-gross domestic product (GDP) ratios, whereas emerging markets have corrected significantly since 2006 and 2011.
- U.S. Mining Losses Last Year Wipe Out Profits From Past Eight Years
The U.S. mining industry—a sector that includes oil drillers—lost more money last year than it made in the previous eight. Mining corporations with assets of $50 million or more recorded a collective $227 billion after-tax loss last year, according to Commerce Department data released Monday. That loss essentially wipes out all the profits the industry had made since 2007.
- Here We Go Again: Government Ramps Up Borrowing As Private Sector Slows
This morning, US existing home sales plunged and the Chicago Fed’s national activity index turned negative. Both are obvious signs of a slowing economy. Anticipating this kind of news, Credit Bubble Bulletin’s Doug Noland in his most recent column analyzed the Federal Reserve’s quarterly Z.1 Report for signs of changing financial trends, and found something potentially serious.
- Michael Hudson on Debt Deflation, the Rentier Economy, and the Coming Financial Cold War
Michael Hudson has sent us the transcript of his newly-released interview with Justin Ritchie on
February 26 with XE Podcast
- NIRP Is Absolutely Crushing Big Parts Of The Finance World
Savers are the obvious victims of the past few years’ plunge in interest rates. But there are other casualties, including money market funds, which have no reason for existing if their yield is negative, and insurance companies, which price their policies on the assumption that they’ll earn good returns on their bond portfolios. As bond yields plunge, the returns insurance companies can expect are also plunging, forcing them into huge write-offs and, soon, steep premium increases that will scare away customers.
- US Military Increases South China Sea Presence; China Balks
In response to China’s assertive moves in the South China Sea, the U.S. State Department struck a deal with the government of the Philippines to permit American military forces to operate from five Philippine bases. The Chinese seem more annoyed than intimidated by the increased American military presence in the region.
- Interest Rates Are Never Going Back to Normal
Let’s see… U.S. corporate earnings have been going down for three quarters in a row. The median household income is lower than it was 10 years ago. And now JPMorgan Chase has increased its estimated risk of a recession to about one in three. These things might make sober investors wonder: Is this a good time to pay some of the highest prices in history for U.S. stocks? Apparently, they don’t think about it… Last week U.S. stocks rose again, after the Fed announced that it would go easy on “normalizing” interest rates. The Dow rose 156 points on Thursday, putting it in positive territory for 2016.
- The Government Wants to Give You Free Cash
Could the government start handing out free cash? It sounds crazy. But believe it or not, it’s a real possibility. In fact, an Ivy league economist just predicted it will happen within five years… If you’ve been reading the Dispatch, you know the Federal Reserve has used crazy monetary policies to “stimulate” the economy since the 2008 financial crisis. These policies have been huge failures. After seven years, the U.S. economy is barely growing. Yet, instead of acknowledging its failure, the government is preparing to double down. And its friends in the lapdog media think it’s time for “helicopter money.”
- Gold and Gold Stocks – A Change in Market Character
Similar to many others, we have been waiting for some sort of correction in gold and gold stocks, but obviously, not much has happened in this respect so far. We have written quite a lot about gold and gold stocks between August 2015 and February 2016, because we felt a good opportunity was at hand – a short term trading opportunity at the very least, but one with the potential to become more than that.
- NATO’s RAGE: Trump Questions America’s Role in ‘Nation-Building’ – Talks of Restoring Russian Ties
GOP presidential frontrunner Donald Trump unveiled his noninterventionist platform to The Washington Post’s editorial board and in the process – questioned America’s relationship with the North Atlantic Treaty Organization…
- China Sends Fed A Warning: Devalues Yuan By Most In 2 Months
With the USD Index stretching to its longest winning streak of the year, jawboned by numerous Fed speakers explaining how April is ‘live' (and everyone misunderstood the dovishness of Yellen), it appears that The PBOC wanted to send a message to The Fed – Raise rates and we will unleash turmoil on your ‘wealth creation' plan. Large unexpected Yuan drops have rippled through markets in recent months spoiling the party for many and tonight, by devaluing the Yuan fix by the most since January 7th, China made it clear that it really does not want The Fed to hike rates and cause a liquidity suck-out again.
- This map shows every country's major export
Bank of America Merrill Lynch is out with its “Transforming World Atlas” research note, which examines global economic trends through a series of maps. One particular map that stood out showed each country's major export, using data from the CIA World Factbook. Notably, many countries heavily rely on commodities as their primary source of foreign income. Consequently, one can use this as a map to see which country gets hit the hardest when commodities drop. For example, those in navy were hardest hit by the oil crash.
- These are the fastest growing and shrinking counties in America
The American population is always changing in various ways. The Census Bureau recently released their annual estimates of population change in the 3,142 counties and county equivalents of the US, showing how populations grew and shrank between July 1, 2014, and July 1, 2015. Using those estimates, we made a map showing the total population change in each county. Red counties had a loss of population, and blue counties saw increases. As has been the overall trend for decades, the Northeast and Midwest tended to see a loss in population, while the big cities of the South and West, along with oil-rich regions in west Texas and North Dakota, saw big increases.
- HEDGE FUND MANAGER: This is ‘no longer an investment market but a battlefield'
London-based hedge fund manager Crispin Odey, who runs $11 billion in assets, said this is “no longer an investment market but a battlefield.” In Odey's OEI Mac fund's February investment update, Odey slammed central banks for lowering or not raising interest rates. “Several years of watching central banks watching central banks responding to ever falling productivity numbers by reducing interest rates have shown that they can effect asset prices with their actions, but that not only do they have almost no effect on economic activity, but they positively damage it,” Odey said. This year has been brutal for Odey. The OEI Mac fund, which invests in Odey's flagship European fund, finished January up 8.3% before seeing all its gains wiped out after falling -10.6% in February.
- Swiss National Bank Admits It Spent $470 Billion On Currency Manipulation Since 2010
By now it is common knowledge that when it comes to massive, taxpayer-backed hedge funds, few are quite as big as the Swiss National Bank, whose roughly $100 billion in equity holdings have been extensively profiled on these pages, including its woefully investments in Valeant and the spike in its buying of AAPL stock at its all time high. But while the SNB's stock holdings are updated every quarter courtesy of its informative SEC-filed 13F (we wish the Fed would also disclose the equities it holds courtesy of its Citadel proxy), getting a gllimpse of the flow is more problematic, and involves waiting for the hedge fund's, pardon central bank's annual report. Earlier today patience was rewarded when the SNB filed its 108th annual report, in which it disclosed that it spent CHF 86.1 billion or $88 billion, on current interventions last year, a measure of its efforts to shield the economy from deflation.
- This Is One Of The Most Important Silver Charts Of 2016!
On the heels of gold and silver continuing to consolidate their gains from the early part of 2016, analyst David P. out of Europe sent King World News an extremely important chart of silver, along with a brief commentary. The following long-term silver chart and commentary was sent to KWN by analyst David P. out of Europe: “The silver chart looks incredibly bullish. The buy signal on the MACD has confirmed the upward move and just look at the setup.”
- Desperate Chinese Investors Flood US, Canadian Housing Markets, But Real Numbers Are Taboo
Buying a home in the US or Canada has been an effective way for foreign residents to launder some money and get their wealth out of harm’s way. In the trophy markets on the US West Coast and in the Canadian cities of Vancouver and Toronto, rumors of a massive influx of Chinese money have swirled with growing intensity for years. The Chinese economic elite are worried about a devaluation of the yuan. They’re worried about getting rolled up by their own government. They’re worried about markets collapsing. They’re worried about pollution. They’re worried about a million things. They have one foot out the door. If push comes to shove, they’re ready to make the move. So capital flight from China has turned into a tsunami. And this money has to go somewhere.
- Oman Gas Projects Could Undermine U.S. LNG Market Ambitions
Two separate projects in the sultanate of Oman are about to turn the tiny Gulf country into an important international liquefied natural gas (LNG) player that the U.S. will have to contend with in its ambition to become the leader of this market. The first one is an agreement with Iran for the construction of a 400-kilometer pipeline that will transport Iranian natural gas to be liquefied at the three-train processing facility of Oman LNG.
- What Is Happening With GLD And Emerging Markets?
The following charts and commentary are from Jason Goepfert at SentimenTrader: ETF traders keep coming into gold. The GLD fund is seeing inflows even as the fund struggles to hold its gains.
- BERNANKE: Here are some of the exotic tools the Fed could use if we see another slowdown
Although the U.S. economy appears to be on a positive trajectory, history suggests that at some time in the next few years we may again face a slowdown, with a weakening job market and possibly declining inflation. Given that the historically low level of short-term interest rates is likely to limit the scope for conventional rate cuts, how would the Federal Reserve respond?
- Bank Earnings Get Mauled by “Leveraged Loan” Time Bomb
Banks have a few, let’s say, issues, among them: a source of big-fat investment banking fees is collapsing before their very eyes. S&P Capital IQ reported today that there was an improvement in the “distress ratio” of junk bonds, after nearly a year of brutal deterioration that had pushed it beyond where it had been right after Lehman’s bankruptcy. The recent surge in oil prices seems to have lifted all boats for a brief period. But not “leveraged loans.” Their distress ratio spiked to the highest levels since the Financial Crisis!
- “The Greatest Crash Of Your Life Is Just Ahead…” – Harry Dent Warns
Harry Dent, best-selling author and economist, has warned that the stock bubble in the U.S. today is the biggest in history and that the “greatest crash of your life is just ahead…” Writing on his website EconomyandMarkets.com, Dent warned that ‘The story on Wall Street and CNBC continues to be that we’re in a correction and this is a buying opportunity. Even Warren Buffett joins the chorus of stock market cheerleaders for the skeptical public. Well, I agree with the skeptical public, not the experts here! The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May.
- Keiser Report: Warnings from Confucius
In a double-Stacy episode, we look at the warnings from Confucius and Adam Smith. First, we look at the danger of those who think but do not learn; so ‘free trade’ deals are imposed because a ‘think tank’ believes it’s a great ideological idea but without looking at history to see what happens when wealth and hope are taken from an entire class of people. Then, in the second half, we look at the most important issue of 2016: creeping monopolization as oligopolies emerge in every major sector in America and across the world.
- Top Advisor To Largest Sovereign Wealth Funds Exposes Fed Manipulation And Intervention
Michael Belkin on the Fed’s interventions and manipulations: “I’m utterly convinced that the Federal Reserve manipulates the stock market. I experienced this firsthand when I worked at a government securities dealer, Solomon Brothers, which was one of the top three investment banks back in the 1980s and early 1990s. And in the 1987 stock market crash, they (the Federal Reserve) came in through us and intervened in the markets to make the markets bounce back. Everybody on the desk knew that. They (at Solomon’s trading desk) watched the (Solomon Brothers) Vice Chairman start bidding for multiple huge blocks of stock with money that we didn’t have. At that point the trading desk was paralyzed and nobody knew what was going on.
- This Oil Sector Hasn’t Crashed Yet… But It’s About to
Unlike the rest of the oil industry – which has been decimated by lower oil prices – U.S. oil refiners have marched on to new highs. But the five-year-long bull market for these companies is about to come crashing down. Let me explain… You can see the incredible uptrend in the following chart of refining giant Valero Energy (VLO). Its shares are trading near an all-time high…
- Oil Prices Fall Fast On Huge Inventory Build
Two hundred and twenty-two years after Josiah G. Pierson patented the rivet machine, and the oil market remains as riveting as ever. (I’m here all week, folks). After yesterday’s API report gave a flourishing hat-tip towards a large build to crude stocks and a large draw to gasoline, oil is sliding amid a stronger dollar, while gasoline is pushing higher. Here are some things to consider today: Jumping straight into economic data, the most insights we’ve had overnight have come from Brazil. Its mid-month inflation print dropped into single digits (at +9.95 percent), but still close to a 12-year high. Meanwhile, its unemployment rate jumped to 8.2 percent, its highest level in nearly 7 years.
- There has been ‘a perfect storm' on Wall Street
By now it should come as no surprise that first-quarter results will be pretty horrendous for Wall Street. Banks will begin reporting Q1 earnings in mid-April, and a chorus including Morgan Stanley's head of trading and the CEO of JPMorgan's investment bank has warned that it will be unusually weak. The data-analytics firm Dealogic's preliminary Q1 results for investment-banking fees show the worst first quarter since the dark post-financial-crisis days of 2009.
- Gold, Silver & The Final Currency War
Andy Hoffman from Miles Franklin is back to help document the global economic collapse for the third week of March, 2016. Thanks for tuning in. And despite the horrific “terror attack” in Belgium today, March 22, 2016 [Google: 322 Skull and Bones], I hope you all have a great week.
- Peter Schiff on gold, the Fed and the world’s addiction to stimulus
Peter Schiff is the CEO of Euro Pacific Capital Inc., and is an outspoken critic of the Fed’s stimulus and zero interest rate policies. He is the author of several New York Times bestsellers including Crash Proof, and most recently, The Real Crash.
- More Confessions of an Economic Hit Man: This Time, They’re Coming for Your Democracy
Twelve years ago, John Perkins published his book, Confessions of an Economic Hit Man, and it rapidly rose up The New York Times’ best-seller list. In it, Perkins describes his career convincing heads of state to adopt economic policies that impoverished their countries and undermined democratic institutions. These policies helped to enrich tiny, local elite groups while padding the pockets of U.S.-based transnational corporations.
- Japan Goes Full Krugman: Plans Un-Depositable, Non-Cash “Gift-Certificate” Money Drop To Young People
The Swiss, the Finns, and the Ontarians may get their ‘Universal Basic Income' but the Japanese are about to turn the Spinal Tap amplifier of extreme monetary experimentation to 11. Sankei reports, with no sourcing, that the Japanese government plans to unleash “vouchers” or “gift certificates” to low-income young people to stimulate the “conspicuous decline” in consumption among young people. The handouts may not be deposited, thus combining helicopter money (inflationary) and fully electronic currency (implicit capital controls and tracking of spending).
- Durable-Goods Orders Weaken Amid Global Headwinds
A key measure of U.S. manufacturing health tipped back into decline last month, evidence that headwinds from weak global growth, low oil prices and financial volatility are weighing on company spending. New orders for durable goods—products designed to last at least three years, like dishwashers and aircraft—fell a seasonally adjusted 2.8% in February from a month earlier, the Commerce Department said Thursday.
- The Initial Jobless Claims Mystery Continues
Still hovering near 43 year lows, initial jobless claims printed a better than expected 265k against expectations of 269k. Continuing claims also dropped from 2.218m to 2.179m – also back near 43 year lows. So, the mystery is – why is the ISM's composite manufacturing and services employment index collapsing to 6 year lows?
- The labor market just did something that hadn't happened since the 1970s
Thursday's initial jobless claims came in stronger than expected, with 265,000 claims versus expectations of 269,000. But the truly historic part of the report actually came three weeks ago. “Today's release also includes revisions of both initial and continuing claims dating back to 2011,” Thomas Simons, senior economist at Jefferies, wrote. “Most of the changes were relatively modest, but the most notable aspect of the revisions is that claims for the week of March 5th (3 weeks ago) were revised down to 253,000 which is, as far as we can tell, the lowest weekly claims figure since November 24, 1973.”
ELITE PLANS FOR 2016 – Take Immediate Action! – A New DVD From Pastor Lindsey Williams. Who will be the next president of the U.S.? Why no financial collapse in 2015? Hear from someone in contact with the Elite. Political Correctness. Five firearms every American should own. Is war inevitable? ORDER NOW online for shipment now. Or call Prophecy Club Toll-Free 1-888-799-6111.
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 March 18, 2016 to March 24, 2016:
- Connecticut Credit Risk Spikes To Record High
Amid cuts in aid and surging taxes, it appears the market remains less than impressed at Connecticut's debt sustainability. Following last week's disappointing bond auction, CT bond risk has spiked to 65bps over the benchmark – a record spread demanded by investors to take CT repayment risk. CT becomes the 4th riskiest US state after NJ, IL, and PA.
- Humans need not apply: RBS to replace 550 roles with robots
Royal Bank of Scotland (RBS) plans to replace 550 of its face-to-face investment advisers with so-called robo-advisers. 220 investment advice roles and 200 protection advice jobs will be cut while face-to-face investment advice will be available only to customers with at least £250,000 in investment assets.
- US Manufacturing PMI Misses By Most Since 2013, Presidential Election Blamed
Given the extraordinary jumps in several regional Fed surveys, hope was rife that US Manufacturing PMI's flash print would jump… it didn't. Hovering near multi-year lows at 51.4, PMI missed expectations of 51.9 by the most since Aug 2013. With record highs in wholesale inventories, Markit claims that “pre-production inventories decline at the steepest pace in over 2 years.” The blame for this plunge: dollar strength, weak global demand, and Trump. Not recovering…
- Americans just had $176 million in wages garnished by the government due to unpaid student loans
Despite more programs available to federal student loan borrowers to manage their loans, borrowers are still struggling. In fact, between October 1 and December 31, 2015, private debt collection companies hired by the Department of Education garnished more than $176 million in wages from defaulted student loan borrowers in order to pay back their debts, according to data released last week. Though the government provides a variety of options to help student loan borrowers manage their payments, it also has extraordinary powers — including wage garnishment — to collect on the debt if a borrower defaults.
- U.S. existing home sales tumble in warning sign for housing market
U.S. home resales fell sharply in February in a potentially troubling sign for America's economy which has otherwise looked resilient to the global economic slowdown. The National Association of Realtors said on Monday existing home sales dropped 7.1 percent to an annual rate of 5.08 million units, the lowest level since November. Sales have been volatile and prone to big swings up and down in recent months following the introduction in October of new mortgage regulations, which are intended to help homebuyers understand their loan options and shop around for loans best suited to their financial circumstances.
- Fed's Lacker says he is confident inflation will return to 2 percent
U.S. inflation is likely to accelerate in coming years and move toward the Federal Reserve's 2 percent target, Richmond Fed President Jeffrey Lacker said on Monday, flagging upside risks to price growth. Inflation has been unusually sluggish since the 2007-2009 recession. The Fed has kept interest rates low in part to foster faster price gains and said last week it was likely to raise interest rates more slowly than policymakers had expected in December.
- Share Buybacks Turn Toxic
Companies are still borrowing and spending billions on buying back their own shares – one of the big drivers behind the blistering stock market rally of the past few years. It worked wonderfully and without fail. But suddenly, it’s doing the opposite, and now the shares of the biggest buyback queens are getting hammered. Something broke in the gears of this financially engineered market! During the November-January period, 378 of the S&P 500 companies bought back their own shares, according to FactSet. Total buybacks in the quarter rose 5.2% from a year ago, to $136.6 billion. Over the trailing 12 months (TTM), buybacks totaled $568.9 billion. That’s an enormous amount of corporate cash that was dumped on the market!
- It's Day 26 Of The Rally – Decision Time
In September/October 2015, the S&P 500 miraculously rallied just over 13% in 25 days amid falling earnings expectations, before collapsing back to fresh cycle lows. It has now been 25 days (and just over 13%) since the Mid-Feb lows (and earnings expectations are plumbing new lows)… The same but different?
- Rich people are paying lawyers to get truthful stories deleted from the internet
Last week, Bloomberg, The Independent, Business Insider and a handful of other news organisations all deleted from their websites a story that a rich family did not want published. I can't tell you why it was deleted or who the story was about, because of a court order from a judge in London ruling that the facts be kept under seal.
- January ‘Bounce' Dies As Fed's National Activity Index Tumbles Back Into Contraction Near 2-Year Lows
After January's hopeful spike to 6 month highs, Chicago Fed's National Activity Index plunged back into contraction (at -0.29) near 2 year lows. A shockingly large 58 of the 85 individual indiators within the index made negative contributions to the overall index which printed notably below the lowest economist's expectations.
- Nanobot implants could give us ‘God-like' intelligence, but machines won't overtake us until they learn to love, scientist claims
The human brain could be enhanced by tiny robotic implants that connect to cloud-based computer networks to give us ‘God-like' abilities, according to a leading computer scientist. Ray Kurzweil, an author and inventor who describes himself as a futurist who works on Google's machine learning project, said such technology could be the next step in human evolution. He predicts that by the 2030s, humans will be using nanobots capable of tapping into our neocortex and connecting us directly to the world around us. However, he admitted that computers won't take over us until they learn to love and laugh.
- Existing home sales plunge 7.1% to a 3-month low in February
Existing-home sales plummeted 7.1% in February, pointing to ongoing rockiness in a housing market struggling to find its footing. Sales ran at a seasonally adjusted annual rate of 5.08 million, the National Association of Realtors said Monday, well below the 5.3 million rate forecast by economists surveyed by MarketWatch. February’s decline followed a strong two months. Sales surged by the most ever in December, and followed with a sturdy reading in January when most economists had expected some giveback.
- Federal Reserve Hot Air Pumped Up a Stock Market Bubble; 93% of Gains Due to Monetary Policy
The mainstream financial media is like a stopped clock. Every once in a while, it stumbles into being right. Last week, we had a veteran trader on CNBC Futures Now telling everybody to buy gold as long as central banks continue their expansionary monetary policy, all the while swearing he isn’t a “gold-bug.”
- Legend Warns The Price Of Silver May Hit $660 As The World Financial System Melts Down
On the heels of wild start to the 2016 trading year, today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events, just warned that the price of silver may be headed to the stratospheric price of $660 as the world financial system melts down. Egon von Greyerz: “The Fed last Wednesday did what I had already forecast back in December and did not increase rates. They know that the real economic situation in the US and in the world is a lot worse than all the manipulated figures and propaganda. Therefore, we are now getting closer to Minsky Moment for the world economy…
- Gerald Celente On Why People Are Buying Gold And Why The Price Is Headed Higher
Today the top trends forecaster in the world spoke with King World News about why the price of gold is going higher. Gerald Celente: “Why are people going into gold and why are gold prices going up? Listen to what former Fed president Richard Fischer said, ‘They (the central banks) are running out of ammunition.’ He also said, ‘We injected cocaine and heroin into the system,’ to basically keep the Ponzi scheme going. So why are people buying gold? Because it (the entire global financial system) is on a fake high. So that’s why gold is going up — it’s a fraudulent game. It’s not working. It’s a fake high. That’s why people are buying gold…
- Radical Leftists Unleash Anti-Trump Riots Starting On March 19th
Many of the exact same groups that participated in Occupy Wall Street and helped organize protest rallies in Ferguson and Baltimore are now promising to bring us “the largest civil disobedience actions in a generation”. I recently wrote about the trouble that radical leftists have caused by attempting to disrupt Trump campaign events, but now there is a very organized effort to turn this into a national movement. On March 19th, thousands of angry protesters will descend on Trump Tower in New York City to denounce Donald Trump’s “fascist policies”, and on April 2nd dozens of leftist organizations will join together to launch “Democracy Spring” in Philadelphia. From there, large numbers of liberal activists will march to Washington D.C. where they will “risk arrest” during a “peaceful” sit-in at the U.S. Capitol from April 11th to April 18th. If the radical left is this freaked out about Donald Trump now, how bad will things get if he actually becomes the Republican nominee?
- Why Investing In Silver Is Vastly Superior To Investing In Gold Right Now
When panic and fear dominate financial markets, gold and silver both tend to rapidly rise in price. We witnessed this during the last financial crisis, and it is starting to happen again. Because I am the publisher of a website called The Economic Collapse Blog, I am often asked about gold and silver when I do interviews. In fact, just a few days ago I was sitting right next to Jim Rickards during the taping of a television show when this topic came up. Jim expressed his belief that investing in gold is superior to investing in silver, but I had the exact opposite viewpoint. In this article, I would like to elaborate on why I believe that silver represents a historic investment opportunity right now.
- Catalonia Nears Default, Threatens Spain’s Debt
When Catalonia’s regional government announced a road map to independence from Spain in November last year, Madrid’s response was to threaten to cut off the financial supply lines to the region. It was the equivalent of a declaration of economic war, riddled with risks, especially with an acutely cash-strapped Catalonia facing over €4.6 billion of bond redemptions in 2016.
- China Hard Landing Hits Electricity Consumption
OK, we’ve heard the official story. China is transitioning from a manufacturing economy to a consumption-based economy. Consumers are king. They’re going to buy stuff. And that’s going to heat up the economy. Imports and exports have been plunging for months, but no big deal, Chinese consumers – and there are a lot of them – are going to pull the economy forward. That’s the official story.
- A Strange Pattern Emerges When Trading The US Dollar In 2016
One of the more surprising market developments of 2016 has been the violent obliteration of those who had taken part in the biggest consensus trade of 2015, namely long the USD. As the Fed finally admitted earlier this week, the US economy is sputtering and is woefully incapable of handling 4 rate hikes, or 3 for that matter. In fact, the Fed will be lucky to push through even one more rate hike without the Chinese Yuan collapsing and unleashing even more capital outflows (which precipitated the major market swoons in the summer of 2015 and early 2016) arguably the main topic during the alleged Shanghai G-20 “central bank accord.” The result: this week saw the biggest two-day USD collapse against a basked of foreign currencies in years, and currently the DXY is trading at a lower level than a year ago.
- January Mortgage Delinquencies up 6.6%; 98,000 Bad Mortgages Face Statute of Limitations in 3 States
The Mortgage Monitor for January (pdf) from Black Knight Financial Services (BKFS, formerly LPS) reported that there were 659,237 home mortgages, or 1.30% of all mortgages outstanding, remaining in the foreclosure process at the end of January. This was down from 688,672, or 1.37% of all active loans that were in foreclosure at the end of December, and down from 1.76% of all mortgages that were in foreclosure in January of last year. These are homeowners who had a foreclosure notice served but whose homes had not yet been seized, and the January “foreclosure inventory” is now showing the lowest percentage of homes that were in the foreclosure process since the fall of 2007. New foreclosure starts, which have been volatile from month to month, fell to 71,900 in January from 78,088 in December and from 93,280 in January a year ago, while they were still higher than the 66,626 foreclosure starts we saw in November, which had been the lowest since the crisis began. Over the past year, new foreclosure starts have remained in a range about one-third higher than number of new foreclosures we we seeing in the precrisis year of 2005.
- “Don't Take The Public For Fools!”: China Hides Millions Of Layoffs, Jails Miners Protesting Unpaid Wages
When you look out across markets and across the increasingly fraught geopolitical landscape, there are plenty of black swans waiting in the wings (no pun intended). And quite a few of them are Chinese. China has, among other problems: a massive debt overhang that, all told, amounts to more than 250% of GDP; a decelerating economy that Beijing swears will be able to pull off a miracle and move away from the smokestack and away from export-led growth without slipping into recession; a currency crisis; a new property bubble in Tier-1 cities; and a burgeoning NPL problem in the banking sector. All of those issues are of course inextricably bound up with one another. They are set like dominoes and once the first one tips, the rest will too as sure as night follows day.
- Life and Times During the Great Depression
The economy of the United States was destroyed almost overnight. More than 5,000 banks collapsed, and there were 12 million people out of work in America as factories, banks, and other shops closed. Many reasons have been supplied by the different economic camps for the cause of the Great Depression, which we reviewed in the first part of this series. Regardless of the causes, the combination of deflationary pressures and a collapsing economy created one of the most desperate and miserable eras of American history. The resulting aftermath was so bad, that almost every future Central Bank policy would be designed primarily to combat such deflation.
- Goldman FX Head: “No Central Bank Conspiracy” To Crush The Dollar, “We Are Right, The Market Is Wrong”
Anyone having listened, and traded according to the recommendations of Goldman chief FX strategist Robin Brooks in the past 4 months, is most likely broke. First it was his call to go very short the EURUSD ahead of the December ECB meeting, which however led to the biggest EURUSD surge since the announcement of QE1. Then, two weeks ago, ahead of the ECB meeting he “doubled down” on calls to short the EUR ahead of the ECB, the result again was a EUR super surge, the biggest since December. And then, as we previously reported, ahead of the FOMC's uber-dovish meeting, Brooks released a note titled the “The Dollar Rally Is Far From Over” in which he said the following: “today brings the latest FOMC meeting. We expect the Fed to signal that it wants to continue normalizing policy, which means three hikes this year and four in 2017, with the statement referring to the risks as “nearly balanced,” reverting to phraseology used in October, just before December lift-off. Overall, our sense is that the outcome will be more hawkish than market pricing, in particular given that the FOMC may leave open the option of tightening at the April meeting.”
- US Money Supply and Debt – Early Warning Signs Remain Operative
Year-end distortions have begun to slowly come out of the data, and while broad true US money supply growth remains fairly brisk, it has begun to slow again relative to January’s y/y growth rate, to 7.8% from 8.32%. So far it remains in the sideways channel (indicated by the blue lines below) between approx. 7.4% and 8.6%, in which it has meandered since mid 2013. We believe the next break “below the shelf” is likely to be a significant event.
- The World Map of the U.S. Trade Deficit
The United States has now run an annual trade deficit for 40 years in a row. Last year was no exception, and in 2015 the U.S. had over $1.5 trillion in exports while importing $2.2 trillion of goods. The resulting trade deficit was -$735 billion. Today’s map from HowMuch.net, a cost information site, helps put this most recent information into perspective. Keep in mind that a trade deficit also means an outflow of domestic currency to foreign markets, as the U.S. is spending more money abroad than it is bringing in.
- The Lego Movie Economy
After the February jobs report, President Obama said “America’s pretty darn great right now.” He then went on to disparage the “doomsday rhetoric” of the Republicans, which he said was pure “fantasy. I think that there is a good chance that this will enter the Hall of Fame of miss-timed statements, right up there with this jewel from Ben Bernanke in March 2007: “At this juncture, however, the impact on the broader economy and financial markets of the problems in the sub-prime market seems likely to be contained.”
- Munich Re Gives The ECB The Middle Finger, Owns Almost 300,000 Ounces Of Gold
Last week, we reported on the ECB’s decision to cut the interest rates and how Mario Draghi said ‘helicopter money’ is ‘an interesting concept that is being studied’. In the accompanying Q&A session, Draghi also said he did not expect the ECB would have to reduce the (already negative) interest rates even further which disappointed the markets. In fact, the disappointment was so big, the ECB already sent one of its members into the trenches to walk back on that statement.
- Investors Buy Gold ETFs at Record Pace
What were the three most popular investments over the last month? If we’re judging by ETF inflows, the three areas that investors piled into were precious metals, government bonds, and low-volatility equities. Notably, it was gold ETFs that set a new record with their highest monthly inflows in eight years, as investors bought $7.9 billion of securities in February. This is according to the latest from market data company Markit, that also noted that inflows relative to assets under management (AUM) were equally as impressive. More specifically, last month’s buying represented an increase of 14.6% in terms of AUM. This is a level only surpassed once before during the heat of the Financial Crisis, when inflows relative to AUM hit 17.7% in February 2009.
- World’s Second Largest Reinsurer Buys Gold, Hoards Cash To Counter Negative Interest Rates
The world’s second-largest reinsurer, German Munich Re which is roughly twice the size of Berkshire Hathaway Re, is boosting its gold reserves and buying gold in the face of the punishing negative interest rates from the European Central Bank, it announced today. As caught by Mark O'Byrne at GoldCore and reported by Thomson Reuters this afternoon, the world’s largest reinsurer is far from alone in seeking alternative investment strategies to counter the near-zero or negative interest rates that reduce the income insurers require to pay out on policies. Munich Re has held gold in its coffers for some time and recently added a cash sum in the two-digit million euros, Chief Executive Nikolaus von Bomhard told a news conference.
- Your Money In The Bank Will Be Gone
The world is now starting the final phase of the failed experiment in creating wealth and prosperity for a select few and massive debt and misery for the masses. It all started with the creation of the Fed in 1913. This led to a global credit creation and money printing extravaganza of a magnitude that the world has never seen before. We have now reached the point when it makes no difference who becomes US president or what the Fed or the IMF will do. No, now we are at the point that von Mises so succinctly defined.
- 12 Obamacare Insurance CO-OPs Fold After Getting $1.2 Bil from Govt.
More than half of the government-funded nonprofit health insurers created by Obamacare have failed, sticking taxpayers with a $1.2 billion tab and leaving hundreds of thousands of people in more than a dozen states scrambling for medical coverage, a new federal audit reveals. The nonprofit insurers are known as Consumer Operated and Oriented Plan Program (CO-OP) and the Department of Health and Human Services (HHS) has pumped $2.4 billion into them under the president’s hostile takeover of the nation’s healthcare system.
- Is coercion ever justified?
Last week’s editorial asked the question: Can the Constitution be improved? We said that the American Constitution represented an new concept in history. It declared that the sovereign power of the state rightfully is derived from the people instead of the divine right of kings. We concluded that it was an amazingly successful beta model but that it was not perfect, because it contained undefined phrases, such as “the general welfare” clause, that left holes through which political predators eventually were able to enter and undermine original intent.
- The Internet Of Things Will Be The World's Biggest Robot
The Internet of Things is the name given to the computerization of everything in our lives. Already you can buy Internet-enabled thermostats, light bulbs, refrigerators, and cars. Soon everything will be on the Internet: the things we own, the things we interact with in public, autonomous things that interact with each other. These “things” will have two separate parts. One part will be sensors that collect data about us and our environment. Already our smartphones know our location and, with their onboard accelerometers, track our movements. Things like our thermostats and light bulbs will know who is in the room. Internet-enabled street and highway sensors will know how many people are out and about—and eventually who they are. Sensors will collect environmental data from all over the world.
- Smartphones to replace cards at bank machines
Here's another use for the smartphone as it invades daily life: in place of your debit card at your bank cash machine. The “cardless” automatic teller machine (ATM) is gaining ground in the US and around the world, with smartphone technology allowing for speedier and more secure transactions. Dozens of US banks are installing new ATMs or updating existing ones to allow customers to order cash on a mobile application and then scan a code to get their money without having to insert a bank card. US banking giants Wells Fargo, Bank of America and Chase are in the process of deploying the new ATMs, as are a number of regional banks and financial groups around the world. Makers of ATMs and financial software groups are ramping up to meet this demand.
- The New New ‘Deal' – “Markets Are Too Important To Be Left To Investors”
Our story so far… In the second half of 2014, export volumes in every major economy on Earth began to decline, the result of divergent monetary policies that crystallized with the Fed’s announced tightening bias in the summer of 2014. This decline in trade activity – which is far more impactful than a decline in trade value, because it means that the global growth pie is structurally shrinking – accelerated in 2015 and 2016 as Europe and Japan intentionally devalued their currencies to protect their slices of the global trade pie. In game theoretic terms, Europe and Japan have been “free riders” on the global system, using currency devaluation to undercut the prices of competing US and Chinese products in a way that avoids domestic political pain.
- Oil output rises even as US rig count falls to historic lows
The number of oil and gas drilling rigs in the US has fallen to the lowest level since data started being collected, although production remains near record highs. The number of rigs drilling in the US now stands at 94, three down on last week and the lowest rig count since the energy consultancy Baker Hughes starting tracking the figures back in 1948. The rig count has dropped by 63 per cent over the past year and is almost 90 per cent lower than peak levels five years ago when oil was in excess of $US110 a barrel.
- Even Mainstream Economists Starting to Admit that “Free Trade Agreements” Are Anything But …
Trump and Sanders have whipped up a lot of popular support by opposing “free trade” agreements. But it’s not just politics and populism … mainstream experts are starting to reconsider their blind adherence to the dogma that more globalization and bigger free trade agreement are always good.
- Trump is completely wrong about the U.S. trade deficit
Thomas Sowell once explained that economists visit the dentist so often because we gnash our teeth hearing so much “ignorant nonsense about the economy.” Thanks to the gibberish spewed almost daily about international trade, dentists must be having an especially busy year. Virtually all economists support free trade and oppose protectionism. For example, a 2014 University of Chicago survey found that 93% of the country's top economists agreed with the statement “Past major trade deals have benefited most Americans” and none disagreed (7% were uncertain).
- The world's second biggest coal miner could be about to go bankrupt
Peabody Energy, one of the world's biggest producers of coal, has warned that it is at risk of going bankrupt in the very near future, thanks to a lack of “sufficient liquidity to sustain operations and to continue as a going concern” caused largely by the continuing downturn in the coal mining industry. In a regulatory filing on Wednesday, the US-based producer said: “There can be no assurance that our plan to improve our operating performance and financial position will be successful.” Peabody has undertaken a huge programme of cost-cutting in recent years to stave off a massive crash in the price of the commodity.
- Richard Russell – The Key To The Bull Market In Gold & The Bear Market In Global Stock Markets
Late last year, Richard Russell gave us the key to the bull market in gold and the bear market in global stock markets. This is the second in a series of releases KWN will be publishing on the wisdom passed down from the Godfather of newsletter writers. From legendary Richard Russell: “I want to start this site off with a bow to Fred Hickey, who puts out The High Tech Strategist. Hickey is a prodigious worker and reads everything. Fred is a true believer in gold and I read his work carefully. Americans are scared to death and befuddled by the news of the day. They are well aware that their own lives and jobs have little to do with the nonsense that the Fed and the government is shoveling out to them.
- Peter Boockvar – Fed Suspends Reality As The Rush To Gold Continues
On the heels of the Fed’s decision not to raise rates, today Peter Boockvar sent King World News a fantastic piece discussing the Fed’s decision and the subsequent surge in the gold market. Peter Boockvar: For the past few years the Fed has been chipping away at the concept that they are driving monetary policy dependent on the data that they see. We know that because they kept changing the rules of the game in that every time a goal was reached the goal was altered. Well, I believe it is safe to say that after yesterday’s FOMC statement, the Yellen press conference and what was said in them, the communication and structural strategy of ‘data dependency’ has been officially neutered. The Fed’s goal is now a perfect world. As we of course will never get there, the rest of us are left flying blind as to what to expect from monetary policy…
- Why Global Debt Growth May Extend The Oil Glut
In this post I present some selected parameters I monitor which may help understand near term (2-3 years) oil price movements and levels. It has been my understanding for some time that the formulations of fiscal and monetary policies affect the commodities markets. Changes to total global debt has and will continue to affect consumers’/societies’ affordability and thus also the price formation of oil.
- Political Turmoil Rages in Brazil, Puts Oil Industry On Edge
More than 3 million people protested in the streets of major cities across Brazil on March 13, numbers that may have exceeded even the massive rallies that took place at the end of the country’s military dictatorship in the mid-1980s. The population is fed up with corruption, fed up with the ruling party, and are seeking the ouster of President Dilma Rousseff.
- The Terrible Oil News Nobody Noticed
A terrible bit of news went unnoticed in the commotion amid the rebound in oil prices over the past two weeks. While every news outlet shouted about Iran and OPEC, a U.S. energy icon quietly announced news that could potentially shatter the industry. As I’ve explained recently, many oil companies are teetering on the brink of bankruptcy. But news out of Alaska could lead to disaster. BP Prudhoe Bay Royalty Trust (BPT) – operated by the Alaskan division of oil giant British Petroleum (BP) – sells oil from the Prudhoe Bay oilfield.
- The Wisdom Of Jesse Livermore As Gold And Silver Surge Strongly After Fed Decision
On the heels of the Fed’s decision not to raise rates, gold soared more than $30 and silver surged as well, and the U.S. dollar tumbled. But even with the recent positive action in the gold and silver markets, what some of the gold and silver community are struggling with at this point is exercising patience. Some have been selling positions and moving to the sidelines, waiting for the next shoe to drop. While there will be pullbacks, KWN readers around the world need to understand that you don’t want to give up your position at the beginning of a new bull market…
- And this is When the Jobs “Recovery” Goes Kaboom
The future for employment looks bright. The gig economy is firing on all cylinders. The FOMC, in its statement concerning its interest rate decision today, was practically gleeful about employment and where it’s headed: A range of recent indicators, including strong job gains, points to additional strengthening of the labor market. The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will continue to strengthen.
- Fleckenstein – Silver May Be About To Scream Higher As People Lose Confidence In Idiot Central Bankers
With many people wondering what’s next for the markets, today Bill Fleckenstein warned silver may be about to scream higher as people lose confidence in idiot central bankers. Despite the Fed’s dovishness, overnight markets were mostly lower, though that did not seem to matter too much to the SPOOs or trading here, as the indices were not very far from unchanged through midday, with the Dow and the S&P slightly higher and the Nasdaq a touch lower. In the afternoon they all marched higher still. By day’s end the Dow/S&P gained about 0.75% (with the Nasdaq just up fractionally despite decent strength in lots of speculative names, especially chips)…
- WTI Crude Slides Back Into Red For 2016 As The Fed And Oil Remain On Unsustainable Paths
Oil prices have increased 50 percent since the lows exhibited earlier this year, a rise that is largely linked to the positive market reaction to the OPEC output freeze. But WTI Crude has given up all its early morning “see oil is fixed” gains in a hurry as once again the algo ramps give way to the realization that, as OilPrice's Leonard Brecken notes, comes even as for all intents and purposes OPEC has nearly reached its production limits and Iran still plans in increasing output.
- The Stunning Size Of China's Housing Bubble In One Chart
Over the past month we have documented the surreal reemergence of China's latest housing bubble (recall the first one burst in early 2014 which forced Beijing to reflate the stock market bubble, which also burst over a year later). But nothing does China's housing bubble justice quite like a simple chart showing what is going on right now with home prices in Shenzhen, which incidentally also puts the housing bubble in the context of China's recently burst stock market bubble. No comment necessary.
- ALERT: Gerald Celente Issues Trend Forecast On Gold And The Fed
The top trends forecaster in the world just announced a trend alert for gold and the Fed! He also discusses the unprecedented moves by central banks. Gerald Celente – Once upon a time, in a pre-smartphone and Facebook Age, workers of the world with a little extra cash did what the millennial generation would never dream of and probably never heard of. They’d deposit their money in savings accounts or buy certificates of deposit…
- Caterpillar cuts Q1 earnings, revenue guidance
Caterpillar on Thursday cut its first-quarter earnings and revenue guidance, but said it remains comfortable with its prior full-year forecast. Shares of Caterpillar fell more than 3 percent in premarket trading on the news. (Get the latest quote here.) The world's largest construction and mining equipment maker's giant said it expects quarterly adjusted earnings of 65 cents to 70 cents a share, sharply lower than Street expectations of 97 cents a share. Revenue was forecast at $9.3 billion to 9.4 billion for the quarter, below expectations of $10.4 billion.
- U.S. current account deficit narrows in fourth quarter
The U.S. current account deficit narrowed in the fourth quarter, but the improvement is unlikely to be sustained as a strong dollar continues to undercut exports of goods. The Commerce Department said on Thursday the current account deficit, which measures the flow of goods, services and investments into and out of the country, fell 3.6 percent to $125.3 billion. The third-quarter deficit was revised up to $129.9 billion from $124.1 billion. Economists polled by Reuters had forecast the current account deficit falling to $118.9 billion in the fourth quarter. For 2015, it totaled $484.1 billion, the largest since 2008.
- Is This Why Yellen Went Full-Dove: U.S. Hiring Plunges Most Since November 2008
While the BLS' JOLTs report usually gets a B-grade in terms of importance due to its one-month delayed look back (we just got the January report which is one month behind the most recent payrolls number) it serves an important function due to its breakdown of various labor components such a job openings, new hires, separations, quits and terminations, all of which make up Janet Yellen's “labor dashboard.” In fact, according to Yellen herself, the JOLTs data is as important, if not more so, than the BLS report. Which may explain why yesterday the Fed surprised as dovishly as it did. As a reminder, the key number most look for in the monthly JOLTs report is the number of Job Openings: for January the BLS reported a print of 5,541K, which modestly beat the expected 5,500K consensus number.
- Luxury jeweler Tiffany's profit beats estimates as costs fall
Upscale jeweler Tiffany & Co (TIF.N) reported a better-than-expected profit for the holiday quarter as it raised prices and benefited from lower prices of diamonds, gold and silver. Shares of the company, which became a household name due to the 1961 Hollywood classic “Breakfast at Tiffany's”, rose as much as 4 percent in morning trading on Friday. Weakness in the global economy and a strong dollar have hurt Tiffany and other luxury retailers such as Nordstrom Inc (JWN.N), Neiman Marcus Group and Macy's Inc-owned (M.N) Bloomingdale's as tourists shy away from buying high-end items.
- Consumer Sentiment Index Falls For Third Straight Month
Consumer sentiment unexpectedly fell for a third straight month in March, according to the latest University of Michigan survey, as Americans suspect that the era of cheap gas is ending. That’s a bad sign for consumer spending from Apple (AAPL) iPhones to Tiffany (TIF) jewelry. The Michigan sentiment index’s flash reading was 90, down 1.7 points from the February’s final reading of 91.7, January’s 92 and December’s 92.6. It’s the lowest reading since October. Wall Street expected a flash March reading on 92.2. The index hit 95.9 in April, the highest since January 2007, but quickly retreated to 87.2 in September.
- The Economic Recovery: A Myth Built Upon a Myth
No matter how much data you point to showing the health of the US economy isn’t as good as advertised, you will inevitably hear the refrain, “But look at the jobs numbers!” Just the other day, Peter Schiff appeared on Fox Business and said the US economy is likely already in recession. Peter repeated his prediction that the Fed wasn’t going to raise rates again, but would instead drop them to zero. National Alliance Securities Global strategist Andy Brenner was having none of that. He insisted the Fed would raise rates at least two more times this year because the economy is doing OK. And what was his proof? You guessed it – jobs! Peter made mincemeat out of Brenner’s argument, pointing out that most of the new jobs in the February report were part-time and low paying.
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Latest News From March 11, 2016 to March 17, 2016:
- Record Swings of Deflation and Inflation Coming-Michael Pento
Money manager Michael Pento says the Fed and other global central banks are “not going to stop manipulating the markets.” Pento explains, “There is no escape from the manipulation by central banks and manipulation of asset prices. There is no escape of manipulation of interest rates, of money supply growth, of stock values and of bond prices. They can never stop. . . . Just a hint that this massive manipulation of all markets and asset classes might end someday sends them crashing. So, there is no escape in Japan, China, Europe and the United States. That means we are headed for massive bouts of wild swings between inflation and deflation, the likes of which we have never before seen in the history of economics.”
- This Chart Shows the First Big Crash Is Likely Just Ahead
The story on Wall Street and CNBC continues to be that we’re in a correction and this is a buying opportunity. Even Warren Buffett joins the chorus of stock market cheerleaders for the skeptical public. Well, I agree with the skeptical public, not the experts here! The bull market from early 2009 into May 2015 looks just like every bubble in history, and I’m getting one sign after the next that we did indeed peak last May.
- What’s in Store for the Real Economy
The Census Bureau announced today that total business sales in January did what they’d been doing relentlessly for the past one-and-a-half years: they fell! This time by 1.1% from a year ago, to $1.296 trillion, and by 5% from their peak in July 2014. They’re now back where they’d been in January 2013. Sales are adjusted for seasonal and trading-day differences, but not for price changes. And since January 2013, the consumer price index rose 2.8%! This is why the US economy has looked so crummy. That’s bad enough. But it gets much worse.
- U.S. Consumer Prices Fell in February
U.S. consumer prices fell in February due largely to a slide in gasoline prices, but other evidence pointed to steadily building inflation pressures that could reassure the Federal Reserve as it considers raising short-term interest rates. The consumer-price index, a gauge of what Americans pay for everything from refrigerators to dental care, declined 0.2% over the month, the Labor Department said Wednesday. Overall prices haven’t risen since November and are up just 1% over the past year.
- U.S. industrial output resumes downturn in February
After hopeful signs of stabilization in January, industrial production decreased 0.5% in February, according to data released by the Federal Reserve on Wednesday. Economists polled by MarketWatch had expected a 0.6% fall in industrial output for February. The Fed revised January’s strong gain in output to 0.8%, down a tad from the 0.9% gain initially estimated. Many analysts said the details were not as disappointing as the headline.
- US Recession Data Signals It's A Very Short Road To Capital Controls
“Prosperity is like a Jenga tower. Take one piece out and the whole thing can fall.” That’s a direct quote from John Williams, the President of the San Francisco Federal Reserve Bank in a speech he gave a few weeks ago. He could have just as easily been talking about propaganda. The Fed, the White House, Wall Street, the media have a vested interest in peddling a certain narrative about the economy. The narrative goes something like this: “Everything’s awesome. Stop asking questions”. But if you look at their own data, the numbers tell a different story.
- China Freight Index Collapses To Fresh Record Low
The Baltic Dry Index has risen for the last few weeks, buoyed by hopes (a la Iron Ore) of a National People's Congress stimulus surge from China. While the scale of the ‘bounce' is negligible in real terms compared to the total collapse, it has caused such momentum-muppets as Jim Cramer to proclaim China ‘fixed' and investible. So we have one quick question – if everything is awesome, why did the China Containerized Freight Index just crash to new record lows? It appears BDIY gets over-excited relative to CCFI…
- US Government Blames 9/11 On Iran, Fines Iran $10.5 Billion; Iran Refuses To Pay
On March 14th, Iran announced that it will never pay the $10.5B that a U.S. court demanded it pay for the 9/11 attacks. The same Bill-Clinton-appointed judge who had ruled, on 29 September 2015, that Saudi Arabia has sovereign immunity for 9/11 and so can’t be sued for it, ruled recently, on March 9th that Iran doesn’t have sovereign immunity and fined Iran $10.5 billion to be paid to 9/11 victims and insurers; but, on March 14, Iran’s Foreign Ministry said Iran won’t pay, because, as the Ministry’s spokesman Hossein Jaberi Ansari put it, “The ruling is ludicrous and absurd to the point that it makes a mockery of the principle of justice while [it] further tarnishes the US judiciary’s reputation.”
- RBS to cut almost 450 investment banking jobs in UK
Royal Bank of Scotland is cutting 448 investment banking jobs in the UK, moving two-thirds of them to India. The bank, 73% of which is owned by the taxpayer, said it would cut back- and middle-office roles in its investment bank, including a small number of technology jobs. Under its chief executive, Ross McEwan, RBS has been shrinking the division to focus on its personal and small business operations in the UK and Ireland.
- US retail sales dip in Feb.; Barclays slashes GDP view
U.S. retail sales fell less than expected in February, but a sharp downward revision to January's sales could reignite concerns about the economy's growth prospects. The Commerce Department said on Tuesday retail sales dipped 0.1 percent last month as automobile purchases slowed and cheaper gasoline undercut receipts at service stations.
- Japanese Gold Buying Spree Confirms Negative Interest Rates Good for Gold
Over the last several weeks, we’ve been building the case that negative interest rates are good for gold, and mainstream analysts have echoed our thoughts. Last week, Britain’s largest bank, HSBC, issued a statement saying the longer the world’s central banks continue to experiment with negative interest rates, the better the outlook for gold.
- US Business Inventory-Sales Ratio Jumps To Post-Crisis (7 Year) High
Following the recessionary surge in Wholesale Inventories-to-Sales ratio, this morning's Total Business inventories-to-sales rose to 1.40x – the highest since May 2009. With a 0.4% slump in sales and 0.1% rise in inventories, the smell of recession lays heavy on US businesses… but then again – who cares if Draghi can keep buying ‘assets' and saving the world?
- Unpaid subprime car loans hit 20-year high
Americans with lower credit scores are falling behind on auto payments at an alarming pace. The rate of seriously delinquent subprime car loans soared above 5% in February, according to Fitch Ratings. That's worse than during the Great Recession and the highest level since 1996. It's a surprising development given the relative health of the overall economy. Fitch blames it on a dramatic rise in loans with lax borrowing standards that have helped fuel the recent boom in auto sales. More Americans bought new cars last year than ever before and the amount of auto loans soared beyond $1 trillion.
- Ackman takes $1B hit as Valeant tumbles 49%
Somebody give Bill Ackman an aspirin. Better make it a double. The embattled hedge fund mogul saw the value of his investment in Valeant Pharmaceuticals fall by $766 million on Tuesday after shares of the troubled company fell by 51 percent in the wake of three troubling disclosures.
- Gold Falls as Investors Lock in Gains Ahead of Fed Meeting
Gold prices fell Monday, as investors locked in gains on the precious metal ahead of this week’s Federal Reserve meeting. Gold for May delivery closed down 1.1% at $1,245.10 a troy ounce on the Comex division of the New York Mercantile Exchange.
- The Cashless Society – Keynesian “Stability” Vs Trumpian Turmoil
In this article, Claudio Grass, Managing Director at Global Gold Switzerland, talks to economist and Mises Institute Senior Fellow Thomas DiLorenzo. This exclusive interview covers central bank monetary policies, Keynesian economics, the economic“recovery,“ political correctness, and much more.
- The Liquidity Endgame Begins: Whiting's Revolver Cut By $1.2 Billion As Banks Start Slashing Credit Lines
Earlier today we reminded readers about the circular (and why note fraudulent conveyance) scheme hatched by JPMorgan to reduce its secured loan exposure to Weatherford, when just two weeks ago none other than JPM underwrote an WFT equity offering in which it sold equity in the company, and which proceeds were promptly used by the company to repay the JPMorgan revolver. We then showed that it wasn't just Weatherford: most of the “uses of funds” from the recent record surge in oil and gas equity offerings, have been used to repay the secured debt/revolver facilities, thereby eliminating funded and unfunded balance sheet exposure of major US banks.
- Having Killed Their Equity Market, China Unleashes “Tobin Tax” For FX Market
In September last year, Chinese regulators stepped on the throat of a ‘fair' market in equity futures trading and for all intent and purpose killed the Chinese equity market. Tonight – after 2 days of Yuan weakness – having warned everyon from Soros to Kyle Bass that “betting against the Yuan can't possibly work,” The PBOC just unleashed plans for so-called “Tobin Tax” on FX transactions (which implicitly taxes each transaction, reducing liquidity, raising margins and reducing leverage). Deputy central bank governor Yi Gang raised the possibility of implementing a Tobin tax late last year in an article written for China Finance magazine, and now, as Bloomberg reports, it is on!
- Trump is a Picky Eater Who Sleeps 3 Hours a Night and Hates Sloppy Dressers, His Ex-Butler Says
What is it like serving at Donald Trump's beck and call? The billionaire’s former butler Tony Senecal has much to tell — like when a young Mr. Trump and first wife Ivana, had four butlers waiting on them hand and foot. Senecal, who served Trump for almost 20 years, told IE: “After Mr. Trump and Ivana got a divorce, we were going over to his room one night and he said: ‘Tony, do I need four butlers?' and I said: ‘As long as it's me Mr. Trump you only need one.’ He got rid of the other three.” Senecal describes Trump as a man always on the move and rarely relaxes. “I'm going into the room to clean it after he's gone and he's re-arranged the closet. And the clothes are all on the floor that he wants to get rid of,” he said. The former butler said that Trump is always busy because he is “always thinking.”
- “It's The Q2 2015 Rally All Over Again” – Morgan Stanley Warns Big Oil Drop Imminent Due To “Rampant Hedging”
One week ago, the market was disappointed when Goldman's head commodity strategist, Jeffrey Currie pointed out the obvious, namely that the higher the price of oil rises, the greater the probability it will tumble shortly, as a result of recently shut off production going back online. To wit: Last year commodity prices were driven lower by deflation, divergence and deleveraging which were reinforcing through a negative feedback loop. Deflationary pressures from excess commodity supply reinforced divergence in US growth and a stronger US dollar which in turn exacerbated EM funding costs and the need for EMs to de-lever though lower investment and hence commodity demand. While we believe that these dynamics likely ran their course last year resulting in signs of rebalancing, the force of their reversal has created a new trend in market positioning that could run further. However, the longer they run, the more destabilizing they become to the nascent rebalancing they are trying to price.
- Bloomberg Stumbles On The “Only One Buyer Keeping The Bull Market Alive”
Last week, when Bloomberg was celebrating the 7 year anniversary of the third longest, most central bank-supported, and thus “most hated” bull market in history, it said that “investors are awash in angst, showing little faith the run can continue. They worry about contracting corporate earnings, slowing Chinese growth and uncertainty over interest rates. And they’re walking the talk by pulling cash from stocks at almost the fastest rate on record. It’s not unwarranted – the S&P 500 has gained just 0.5 percent in the last 18 months.”
- Stocks are climbing that ever-higher “wall of worry”
It can hardly be denied that stocks are climbing that infamous “wall of worry”. Every day it seems, more and more doom-laden headlines appear in the media to suggest stocks are heading for an almighty fall. That is making my “headline indicator” (HI) start to twitch (as it has done recently for crude oil and gold). On Thursday afternoon, Mario Draghi unleashed his latest money-printing bazooka, and I made a few comments on Friday on how that related to the euro. Since then, there has been a veritable barrage of negative comment from the pundits on why central banks are out of ammo. Many conclude that the next crisis will see them powerless to stem the inevitable wave of selling.
- Fed’s ‘Cocaine and Heroin Injection’ a Criminal Act-Gerald Celente
Trends forecaster Gerald Celente says former Fed President Richard Fisher dropped an ominous truth bomb last week on CNBC. Celente says, “Last week, when it was a celebration of . . . 2009 and the markets started going up, Fisher says, quote, ‘We injected cocaine and heroin into the system to enable a wealth effect . . . and now we are maintaining it with Ritalin.’ Fisher also said, a few weeks ago, that ‘the Fed is a giant weapon that has no ammunition left.’ Let’s take his quote, and this is very important, ‘We injected cocaine and heroin into the system.’ You go back to our 2010 alert, and we said this was no recovery. It was a cover-up. What Fisher just said was a criminal act. Injecting cocaine and heroin into the system was a criminal act by the banking gang.”
- Still not enough: US gov’t collects record $1.2 trillion in taxes, or over $8k per taxpayer
Uncle Sam hauled in $1.248 trillion in taxes for the first five months of fiscal year 2016, costing each taxpayer $8,263, according a monthly Treasury Department statement. Even after adjusting for inflation, however, the government is still in the red. The federal government collected more money between October 2015 and February 2016 than it did any other five months in history, said the Treasury statement, released on Thursday. The US fiscal year begins on October 1 and runs through September 30.
- Obama makes case for gov access to all digital devices to prevent terrorism and tax cheats
Without mentioning the government’s case against Apple directly, President Barack Obama told a Texas audience that mobile devices should be built such a way that the government can access them in order to prevent a terrorist attack or enforce tax laws. “The question we now have to ask is: If technologically it is possible to make an impenetrable device or system where the encryption is so strong that there is no key, there’s no door at all, then how do we apprehend the child pornographer, how do we solve or disrupt a terrorist plot?” Obama said during a question and answer session at the South by Southwest Interactive festival in Austin, Texas on Friday, according to Reuters.
- Trend Forecaster Gerald Celente Warns: Prepare For The Panic Of 2016: “History Will Remember This”
Earlier this week hedge fund manager Marin Katusa explained that up until the recent stock market hit all the easy money flowing into the energy sector was being exuberantly spent on hookers, blow and fancy toys. Now, as oil prices hover under $40 per barrel, Katusa said more pain is likely coming and oil, along with other asset classes, are going to go “lower for longer.” In a recent interview with Future Money Trends, trend forecaster Gerald Celente echos Katusa’s concerns. Having accurately predicted the Crash of 2008 nine months ahead of the bottom falling out on a global scale, Celente says another panic is coming this year.
- Credit Card Debt In The United States Is Approaching A Trillion Dollars
For the first time ever, total credit card debt in the United States is approaching a trillion dollars. Instead of learning painful lessons from the last recession, Americans continue to make the same horrendous financial mistakes over and over again. In fact, U.S. consumers accumulated more new credit card debt during the 4th quarter of 2015 than they did during the years of 2009, 2010 and 2011 combined. That is absolutely insanity, because other than payday loans, credit card debt is just about the worst kind of debt that consumers could possibly go into. Extremely high rates of interest, combined with severe penalties and fees, can choke the financial life out of almost any family in no time at all.
- Beware: The market’s ‘crystal ball’ just turned from bullish to bearish
Once again, the stock market’s crystal ball proved to be deadly accurate. About a month ago, I wrote that the option premiums on the Volatility Index (“VIX”) were slanted highly in favor of a lower VIX. And because a lower VIX usually means a higher stock market, I argued the market’s crystal ball – VIX option prices – was predicting a rally in stocks…
- Until this happens, keep buying gold: Gartman
Gold is up nearly 20 percent in 2016, and that has veteran trader Dennis Gartman urging investors not to sit out on the rally. “The trend is up, the trend has been up for the last several months and I continue to think that as long as the monetary authorities are going to remain as expansionary as they are [this trend will continue],” the editor and publisher of The Gartman Letter said in an interview with CNBC's “Futures Now” on Thursday. “Monetary expansion equals higher gold prices.”
- Jim Rogers: ‘This isn’t the end of the correction in gold’
I recently had a chat with fellow Singapore resident Jim Rogers, one of the most successful investors in history. Jim co-founded the Quantum Fund, one of the world’s most successful hedge funds. After the fund generated returns of more than 4,200% over 10 years, Rogers quit full-time investing. He went on to drive around the world, literally, and write several excellent books that blend travelogue, investment insight, and political commentary. Today, Jim is viewed as one of the founding fathers of the boots-on-the-ground approach to investing in emerging and frontier markets around the world.
- Secret Monetary Group Warns a Catastrophe Is Coming
The Bank for International Settlements is nothing if not obscure. As the central bankers’ bank, it seems little-more than a back-door, private club for monetary elites to rub shoulders. And it’s located in Switzerland which has always carried a reputation for financial secrecy. Then it has this going for it – John Keynes of “Keynesian economic theory” opposed its dissolution back in the 1940s. His was the kind of thinking that has largely influenced central banks to hijack our economies with manipulative monetary policies! So you’d probably think I hate these guys.
- Bundesbank Fears “Doom Loop”
“ECB barrel-scraping getting louder” – that’s what Daiwa Capital Markets called it. But those acts of desperation, as sweet as they seem to the markets, had slammed into opposition at the German Bundesbank. And now “people familiar with the matter” and a “central bank source” are talking to the Wall Street Journal to air their concerns. Yesterday, the ECB bent over backwards to increase the negative interest rate absurdity, given how well it has been working so far. It cut its deposit rate one notch to negative 0.4%. That was less than expected. But it also added a slew of “surprises” intended for the markets to feed on and soar.
- SILVER OUTBREAK: Investment Demand Will Totally Overwhelm The Market
It's no secret to the precious metal community that silver is one of the most undervalued assets in the market, however 99% of Mainstream investors are still in the dark. This was done on purpose to keep the majority of individuals invested in Wall Street's Greatest Financial Ponzi Scheme in history. You see, this is the classic PUMP & DUMP strategy. Unfortunately, it's not a lousy penny stock that Wall Street is pumping, rather it's the entire market. Most pump & dump stock campaigns last a day, week or a few months. Sadly, this one has gone on for decades and the outcome will be disastrous for the typical American.
- “Gloom” Returns To China's Economy: Industrial Production, Retail Sales Miss Lowest Estimates
After an unprecedented surge in Chinese attempts to stimulate the economy in late 2015, mostly on the fiscal side, coupled with recent monetary easing by the PBOC which cut the banks' reserve ratio recently and unleashed a tsunami of new loan creation in January, many expected that this unprecedented credit impulse would translate into at least a modest rebound for the economy, prompting a stable pick up in spending for the economy which many are touting is now consumer-spending driven as opposed to export and production.
- From Champs To Chumps: Latin America Oil Giants Owe $275 Billion
The Latin American state-run oil companies whose largesse filled government coffers from Mexico to Brazil during the crude boom of the previous decade are quickly becoming dangerous liabilities as soaring debt levels spook investors. Regional leaders are being forced to shelve plans to spend petro-cash on popular projects after oil prices plunged more than 50 percent in the past two years and are instead grappling with mounting bills at their state-backed champions. The burden is being amplified as local currencies crumble against the dollar, driving up the cost of to pay off foreign debt.
- A Right Way and a Wrong Way to Weather “The War on Cash”
Many people have been talking recently about the “war on cash.” With policymakers seriously talking about eliminating cash, it can be worrisome. But there is a way to avoid the consequences of the “war on cash. You just need to pick the right strategy. With the endless lowering of interest rates and the possibility that they could turn negative, there is more incentive than ever for people to pull their dollar savings from banks and just hold on to the paper cash at home. After all, why risk your dollars in a bank that yields zero return or even charges you to hold your money? As a result, people are buying up safes, pulling their dollars out of the bank, and storing them at home.
- Why Negative Rates Can’t Stop the Coming Depression
Are you ready to pay to save? Agora founder Bill Bonner explains why “negative interest rates” are spreading around the world…and could soon come to the U.S. Negative interest rates are a disaster story in the making. And they will only speed up the major monetary collapse we believe is coming. Bill believes the fallout from his catastrophe will be far worse than 2008. When it hits, every service you’ve come to depend on – your bank…your grocery store…your Social Security checks – will shut down.
- U.S. import prices fall for eighth straight month
U.S. import prices fell in February for an eighth straight month, weighed down by declining costs for petroleum and a range of other goods, but the pace of decline is slowing as the dollar's rally fades and oil prices stabilize. The Labor Department said on Friday import prices slipped 0.3 percent last month after a revised 1.0 percent decrease in January. Import prices have decreased in 18 of the last 20 months, reflecting a robust dollar and plunging oil prices. They were down 6.1 percent in the 12 months through February. That was the smallest year-on-year drop since December 2014. Economists polled by Reuters had forecast import prices slipping 0.6 percent last month after a previously reported 1.1 percent fall in January.
- China's yuan hits 2016 high on strong fixing, global US dollar weakness
China's onshore yuan on Friday (March 11) hit its strongest level against the US dollar in 2016, buoyed by the central bank's firmest midpoint this year and the greenback's slide after the European Central Bank suggested it was done cutting rates for now. Offshore yuan strengthened 0.3 per cent from Thursday to hit its highest level since early December at 6.4733 just before midday. The onshore yuan hit 6.4866 in late morning trade, its highest level since Dec. 29. Its previous 2016 peak was 6.4880, on Feb 15.
- Silver Could Be Poised to Come Out of the Shadows
While there’s been a lot of attention focused on gold over the last few months, silver has remained in the shadows. The white metal has lagged a bit behind as the gold market turned bullish over the last few months. But there are some good reasons to take a close look at silver. According to Bloomberg, silver has advanced 10% since the first of the year while gold surged 18%. But dynamics look good for silver to close that gap: “Silver hasn’t been so cheap relative to gold for more than seven years and with mine supplies forecast to contract this year that may be a sign it’s ready to come out of the yellow metal’s shadow.”
- Men's Wearhouse parent closing 250 stores
Shares of Tailored Brands, formerly known as Men's Wearhouse, jumped more than 11 percent in early trading Thursday, a day after the company announced plans to close roughly 250 stores this year. That includes shuttering 80 or 90 full-price Jos A. Bank stores. The announcement followed worsening sales trends at that label in the fourth quarter, with the company adding that it expects weakness there to continue into 2016. Revenues at Jos. A. Bank have gotten whacked since the company ended its ubiquitous Buy One Get Three Free promotion in October.
- The World Economy Wreckers Of Beijing
The desperate suzerains of the Red Ponzi are incorrigible. There appears to be no insult to economic rationality that they will not attempt in order to perpetuate their power, privileges and rule. So now comes the most preposterous gambit yet. Namely, a veritable tsunami of state handouts to foster, yes, capitalist entrepreneurs! That’s right. As described by Bloomberg, Premier Li Keqiang gave the word, and, presto, nearly $340 billion poured into an instantly confected army of purported venture capital funds run by local government officialdom all over the land.
- German bank that almost failed now being paid to borrow money
German bank Berlin Hyp had just issued 500 million euros worth of debt… at negative interest. I wondered if I really did go through a time warp, because this is exactly the same madness we saw ten years ago during the housing bubble and the subsequent financial crisis. To explain the deal, Berlin Hyp issued bonds that yield negative 0.162% and pay no coupon. This means that if you buy €1,000 worth of bonds, you will receive €998.38 when they mature in three years. Granted this is a fairly small loss, but it is still a loss. And a guaranteed one. This is supposed to be an investment… an investment, by-the-way, with a bank that almost went under in the last financial crisis. It took a €500 billion bail-out by the German government to save its banking system. Eight years later, people are buying this “investment” that guarantees that they will lose money.
- ECB cuts rates to new low and expands QE
The European Central Bank has unveiled a series of new measures to strengthen the eurozone’s recovery, with policy makers expanding their quantitative easing package and cutting benchmark interest rates to a new low. The ECB has raised the amount of bonds the eurozone’s central bankers buy each month under QE from €60bn to €80bn — a greater amount than many analysts had expected. It also expanded the range of assets it will buy to include corporate bonds. At the moment, the ECB buys mostly government debt alongside smaller amounts of bundles of smaller loans repackaged into asset-backed securities and covered bonds. The central bank’s governing council also cut its deposit rate by 10 basis points to minus 0.4 per cent. The main refinancing rate fell by 5 basis points to 0 per cent. The move, which was towards the low end of markets’ expectations, in effect raises the fee charged on some bank deposits parked at central banks in the Eurosystem.
- Former Reagan Advisor: Congress Just “Hatcheted” Your Social Security Benefits
While it went virtually unnoticed, Section 831 of the House's new budget bill could radically change your Social Security benefits as soon as May 1. This change will affect the benefits that as many as 21.3 million Americans could be eligible for, instantly. It could change your chosen retirement date. It could change the way you vacation. It could change your entire financial future…
- Bear Market 2016 Will Get Worse for One Major Reason
During a four-day rally last week, the Dow Jones Industrial Average climbed 490 points. And that was just the most recent surge in the index's 1,200-point recovery since its dismal start in early January. While the signs of a rebound were encouraging, Money Morning experts say “bear market 2016” isn't close to being over. “Despite some moderately positive economic news last week, the global economy remains depressed and the prospects for significantly higher stock prices are low,” Money Morning Global Credit Strategist Michael Lewitt said.
- The Stronger U.S. Dollar Is Actually Destroying the Markets
The U.S. dollar remains the most important financial instrument in the world. The dollar rally has been the single most decisive factor in determining economic growth (or weakness) and market direction since early 2014. And – right now – that's not a good thing. Don't listen to Alan Ruskin, the macro strategist from Deutsche Bank (need I say more?) who posits that the strengthening dollar is largely a positive, since it's paired with an “improving labor market” and a “lower misery index.” He's looking for misery in all the wrong places.
- Terminally ill face being forced to do work experience or lose their benefits
Terminally ill people face being forced to work to keep their benefits under draconian new Government plans, it was revealed yesterday. Cancer patients who have more than six months to live could have to do work experience or see their payments slashed under the scheme by Work and Pensions Minister Iain Duncan Smith.
- Number of people on zero-hours contracts in UK increases to 801,000
The number of workers on zero hours contracts in the UK has increased by 15 per cent in the last three months of 2015 compared with a year earlier, an increase of 104,000 contracts, according to the latest figures from the Office for National Statistics. One in 40 UK workers is on a contract that does not guarantee a minimum number of hours, the figures show. Some 801,000 workers were on zero-hours contracts in the UK from October to December 2015, or 2.5 per cent of people in employment, compared to 697,000 workers in the same period in 2014. Part of the increase may be accounted for by additional recognition of the term zero-hours, the ONS said, rather than new contracts.
- Jim Rogers Says 100% Probability US Is Heading for Recession; Data Backs Him Up
Media and government officials keep telling us the economy looks great, but a peek behind the curtain tells a different story. Some people do see the writing on the wall. Peter Schiff has been saying the US may well have already entered a recession. Last month, Jim Grant echoed Peter, saying the US economy likely went into recession in December 2015. And in a recent interview, Rogers Holdings Chairman Jim Rogers said there is a 100% probability the US will be in a downturn within a year: “It’s been seven years, eight years since we had the last recession in the US, and normally, historically we have them every four to seven years for whatever reason—at least we always have. It doesn’t have to happen in four to seven years, but look at the debt, the debt is staggering.”
- This chart explains how the Baltic Dry Index could spell doom for the global economy
Even if you follow markets and global economics news, you still may not know what the Baltic Dry Index (BDI) is and why it matters. You might guess it's related to shipping – and you'd be right. The BDI is a very useful gauge of global trade, and tells you how much it costs to move goods around the world in massive ships. These goods can be pretty much anything: iron ore, grain, coal … stuff the world needs to build things and function. As such, analysts keen to predict how the health and future of the global economy like to pay close attention to it.
- Are You Kidding Me? Chinese Exports Plunge 25.4 Percent Compared To Last Year
We just got more evidence that global trade is absolutely imploding. Chinese exports dropped 25.4 percent during the month of February compared to a year ago, and Chinese imports fell 13.8 percent compared to a year ago. For Chinese exports, that was the worst decline that we have seen since 2009, and Chinese imports have now fallen for 16 months in a row on a year over year basis. The last time we saw numbers like this, we were in the depths of the worst economic downturn since the Great Depression of the 1930s. China accounts for more global trade than any other nation (including the United States), and so this is a major red flag. Anyone that is saying that the global economy is in “good shape” is clearly not paying attention.
- China Resorts to “Stealth Interventions” to Prop Up Yuan and Stock Market
A record $1 trillion or so has fled China in the last year or so. Official reserve data is masked, so it’s difficult to pin a precise number. We do know the official monthly drain is the smallest since June, but Daiwa Capital Markets believes PBOC Using Stealth Intervention as Reserves Decline.
- Crackpot Valuations
The markets are eerily quiet. With so many trends and facts to titillate us all, you’d expect a little more excitement. As it is, the big sell-off at the start of the year seems incomplete – a kind of financial foreplay without the climactic battering of a real bear market. What to make of it?
- A $10 billion hedge fund is bracing for a 2008-type event
Perry Capital, a $10 billion New York-based multi-strategy hedge fund led by Goldman Sachs alum Richard Perry, is preparing for another credit event like 2008. Perry Capital bought $1 billion worth of credit-default swaps (CDS) on about 10 investment-grade corporate bonds, The Wall Street Journal reported last month. Investment-grade bonds have a rating of BBB or higher by Standard & Poor's or Baa3 or higher by Moody's. They are companies seen as having the safest balance sheets. Perry stands to profit if those companies are downgraded by ratings agencies.
- Markets betting on near-zero interest rates for another decade
World markets may have recovered their poise from a torrid start to the year, but their outlook for global growth and inflation is now so bleak they are betting on developed world interest rates remaining near zero for up to another decade. Even though the U.S. Federal Reserve has already started what it expects will be a series of interest rate rises, markets appear to have bought into a “secular stagnation” thesis floated by former U.S. Treasury Secretary Larry Summers. The idea posits that the world is entering a peculiarly prolonged period in which structurally low inflation and wage growth – hampered by aging populations and slowing productivity growth – means the inflation-adjusted interest rate needed to stimulate economic demand may be far below zero.
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Latest News From March 5, 2016 to March 10, 2016:
- Central Banks Out of Bullets: THE GOLD BULL IS BACK
The multi-year bear market for gold and silver mining stocks appears to be coming to an abrupt end as gold breaks important resistance. The GDX mining stocks ETF has moved from $12 to over $19 in less than two months. As we re-enter a GLOBAL gold bull market, smart money appears to be leveraging rising gold and silver prices through the precious metals mining company stocks. Amir Adnani, the founder and Chairman of Brazil Resources joins me to discuss his outlook for the precious metals mining sector and global economy. About the central bankers Adnani says “They’re out of bullets.” As the result of negative interest rates and endless fiat money printing, people are quickly turning back to real money, gold. Adnani believes we are at the very beginning of an historic gold bull market, the likes of which the world has never seen.
- “Freedom Always Dies Bit by Bit”: Bundesbank Takes Sides in War on Cash
There are two sides in the global war against cash. On one side are many of the world’s governments, central banks, fintech firms, banks, credit card companies, telecommunication behemoths, financial institutions, large retailers, etc. According to them, the days of physical currency are numbered, so why not pull the plug already, beginning with the largest denomination bills such as the $100-note and particularly the €500-note?
- Oil Prices Up In Spite Of Crude Inventory Build
On the 84th birthday of the most wonderful Keely Smith (no relation, by the way), the oil market is reversing yesterday’s losses and going ‘zooma zooma’ to the upside, despite an impending solid build to crude stocks from the weekly EIA inventory report.
- How China Is About To Unleash A Monster Housing Bubble, In Six Easy Steps
One week ago we showed the disturbing degree to which the latest (and greatest) housing bubble among China's Tier 1 has gripped the broader public, when we reported that local speculators are waiting in line for days to flip homes.
- Jeff Gundlach on the global economy, the Fed's next move, and negative interest rates
Jeff Gundlach held his latest webcast on markets and the economy, called “Connect the Dots,” on Tuesday. The big takeaways were: The Federal Reserve has no business raising rates right now. Markets aren't pricing in a hike this month in, and no one has forgotten the volatility that ensued after the first hike in December. The rally in risk assets is near its end. Stocks have 2% of upside but 20% of downside. And there's still time to wait for commodities to cheapen more before buying. There isn't a strong case for an imminent US recession. Negative interest rates are bad for the world. They are having the opposite effect on currencies like the Japanese yen, which has rallied instead. They are also hurting European banks.
- OK, I Get it, this Stock Market Is Going to Be a Mess
Just how overvalued are stocks, particularly small-caps? According to Wall Street, even the question is wrong. Stocks are never overvalued. They’re always a buy. The future looks bright. And even if it doesn’t look bright, analysts come up with “adjusted” earnings that are so brilliant that they blind even innocent bystanders. That’s how Wall Street justifies high stock prices.
- Global Rig Count Continues To Tumble
The rig count data in all charts below is through February 2016. The Baker Hughes International Rig Count does not include the U.S., Canada, any of the FSU countries or inland China. It does include offshore China. That rig count peaked in July 2014 at 1,382 rigs and in February stood at 1,018, down 364 rigs from the peak.
- Gold Could Surge To $8,000/oz On Negative Interest Rates – Lassonde
The gold bull market has returned and gold could surge over 1,000% to $8,000 per ounce in the coming years on ZIRP and NIRP according to legendary gold investor and industry insider Pierre Lassonde. Gold prices are heading higher, much higher and he is “very sure” that the five-year bear market for gold is over and we are at the beginning of a new bull market, the gold insider told leading Canadian business channel, BNN.
- U.S. wholesale stocks rise, seen hurting growth in 2016
U.S. wholesale inventories unexpectedly rose in January as sales tumbled, suggesting that efforts by businesses to reduce an inventory overhang could persist well into 2016 and restrain economic growth in the coming quarters. The Commerce Department said on Wednesday wholesale stocks increased 0.3 percent after being unchanged in December. Sales declined 1.3 percent, extending December's 0.6 percent drop. January's weak sales pace means it would take wholesalers 1.35 months to clear shelves, the highest inventory-to-sales ratio since April 2009, when the economy was in recession.
- Deflation Is Coming To The Auto Industry As Used Car Prices Drop, Off-Lease Deluge Looms
Last week, we learned that vehicle leasing as a percentage of monthly light-vehicle sales hit a record in February at 32.3%. In other words, a third of the over 1 million cars and light trucks “sold” during the month were leases, according to J.D. Power. This is indicative of what is now a long-term trend.
- The Collapse Of Italy’s Banks Threatens To Plunge The European Financial System Into Chaos
The Italian banking system is a “leaning tower” that truly could completely collapse at literally any moment. And as Italy’s banks begin to go down like dominoes, it is going to set off financial panic all over Europe unlike anything we have ever seen before. I wrote about the troubles in Italy back in January, but since that time the crisis has escalated. At this point, Italian banking stocks have declined a whopping 28 percent since the beginning of 2016, and when you look at some of the biggest Italian banks the numbers become even more frightening. On Monday, shares of Monte dei Paschi were down 4.7 percent, and they have now plummeted 56 percent since the start of the year. Shares of Carige were down 8 percent, and they have now plunged a total of 58 percent since the start of the year. This is what a financial crisis looks like, and just like we are seeing in South America, the problems in Italy appear to be significantly accelerating.
- Britain will be ‘dragged along' into a European superstate if it stays in the EU, Boris Johnson warns
Britain will find itself “dragged along” into an ever more integration European Union if it does not vote to leave, Boris Johnson has said. The Mayor of London wrote in his column for the Daily Telegraph newspaper that European federalists “mean it” when they said they wanted a full political union.
- Saudi Arabia Suffers from Oil Recession, Looking to the US for Help
When OPEC made the decision to maintain their levels of oil production, they did not expect such heavy losses themselves. Many have suspected that OPEC wanted to eliminate competition from American-based shale oil producers, and therefore, kept production high in order to lower the oil price. However, OPEC apparently did not foresee certain economic disadvantages that they would incur due to their actions.
- Peter Schiff: $5,000 Gold is Coming
Peter Schiff did an interview with Rick Wiles of TRUNEWS on Monday and said $5,000 gold is coming. Peter reiterated his belief that the economy is already in a recession, and Fed will drop rates back to zero. After that, he said the central bank will initiate another round of quantitative easing. He made his case by explaining how the jobs numbers aren’t nearly as good as the government spin-doctors are saying, pointing out evidence of looming stagflation ahead, and making a compelling case that another real estate crash is likely in the near-future.
- Small-Business Owners' Confidence Wanes in February
Small-business owners turned less confident about their economic prospects last month, with lackluster sales crimping margins and ongoing uncertainty over the economic outlook and political landscape pinching spending plans. The National Federation of Independent Business's small-business optimism index, based on a survey sent to about 5,000 owners, slipped 1 point to 92.9, the lowest level in about two years. In 2015, the gauge averaged 96.1.
- Consumer Credit Growth Weakest Since March 2013
Against expectations of a $17 billion surge, US consumer credit grew at just $10.5 billion – the weakest and biggest miss since March 2013. The biggest driver of this disappointment was an actual contraction in revolving credit (down $1.1 billion) for the first time since Feb 2015.
- There's a ‘gathering storm' in the global economy and central banks are running out of options
The Bank for International Settlements (BIS) — known as the central banks' central bank — is warning there's a “gathering storm” in the global economy, in part caused by governments around the world running out of monetary policy options. In two separate notes, published March 6, BIS economists highlighted the fragile global economic backdrop and said negative interest rates could become a reality for many more countries as central banks search for ways to stoke real growth and battle issues like tumbling oil prices hitting the economy.
- Hillary’s Scary New Cash Tax
The largest underground currency market in history…how to make huge investment gains from negative interest rates…none dare call it a tax.
- More Paper Than Gold: Issuance of ETF Shares Suspended Due to Surging Metal Demand
The world’s largest asset manager has temporarily suspended the creation of new shares of its gold ETF due to the demand for physical gold. BlackRock announced it would temporarily stop issuing new shares of Gold Trust (IAU) on Friday: “Since the start of 2016, in response to global macroeconomic conditions, demand for gold and for IAU has surged among global investors. IAU has $8 billion in assets under management, and has expanded $1.4 billion year to date. February marked its largest creation activity in the last decade. This surge in demand has led to the temporary exhaustion of IAU shares currently registered under the ’33 Act.”
- Sweden Begins 5 Year Countdown Until It Eliminates Cash
How much louder can the “ban cash” calls get? Recall it was just last year when we catalogued the growing cacophony of crazies for whom banning physical currency is the only way to ensure that depositors can’t simply reassert their economic autonomy under a low or zero rate regime. Put simply, if interest rates get too low, depositors will simply take their money out the bank and put it in the mattress or the safe where, to quote WSJ from last week, “interest rates are always low no matter what central bankers do. Most recently, Larry Summers called for the abolition of the $100 bill in the US and in Europe the €500 note is to go the way of the dinosaurs.
- Worried about stocks? Don't watch so much: Buffett
If investors are worried about their retirement savings after watching 2016's wild market fluctuations, Warren Buffett has some advice. “I would tell them don't watch the market closely,” the Oracle of Omaha said. The billionaire and philanthropist who has amassed a fortune of more than $64 billion tells CNBC's “On The Money” that buy-and-hold is the best strategy. “The money is made in investments by investing,” Buffett said in a recent interview, “and by owning good companies for long periods of time. If they buy good companies, buy them over time, they're going to do fine 10, 20, 30 years from now.”
- The Nine Horsemen Of The US Recession Apocalypse
“There are no signs of a US recession anytime soon”… apart from these nine charts that is…
- The $15 Minimum Wage and the End of Teen Work
A new report from JP Morgan Chase & Co. finds that the summer employment rate for teenagers is nearing a record low at 34 percent. The report surveyed 15 US cities and found that despite an increase in summer positions available over a two year period, only 38 percent of teens and young adults found summer jobs.
- Death Of Paper Gold Picks Up Speed BIG TIME Today
We may be finally witnessing the REAL ENDGAME TO PAPER GOLD MANIPULATION. The Death of the paper gold market picked up speed today as Blackrock announced that issuance of new Gold IAU ETF shares was suspended. However, it’s MUCH WORSE than the information in news release…
- It’s a revolution: German banks told to start hoarding cash
German newspaper Der Spiegel reported yesterday that the Bavarian Banking Association has recommended that its member banks start stockpiling PHYSICAL CASH. Europe, of course, has been battling with negative interest rates for quite some time. What this means is that commercial banks are being charged interest for holding wholesale deposits at the European Central Bank. In order to generate artificial economic growth, the ECB wants banks to make as many loans as possible, no matter how stupid or idiotic.
- Oil rig count drops for 11th straight week
The combined count of US oil and gas rigs is one shy of a record low. Data from driller Baker Hughes Friday showed that the oil rig count fell by 8 to 392 this week. It's the lowest count since the week of December 4, 2009. The tally of gas rigs fell 5 to 97, taking the total rig count down 13 to 489, one rig above the lowest level in about 70 years. The combined count of oil and gas rigs has plummeted in the last few weeks. Last week, the oil rig count fell by 13, while the gas count rose by one.
- This chart shows the Bilderberg Group’s connection to everything in the world
The Bilderberg Group is 120-140 powerful people who meet each year to discuss policy. The meetings are closed to the public. This graph we found on Facebook shows the members’ connections to a ton of corporations, charities, policy groups and media. Everyone from Eric Schmidt to George Soros is a member. There are tons of conspiracy theories about the group, including that they control the world economy. We took the findings with a grain of salt–after all, it’s easy to trace an individual to a corporation and the graph doesn’t specify what influence the member wielded. But perhaps it’s a compelling argument for why the meetings should be public.
- Now the Swiss withdraw their bid to join the EU: Nation's parliament retracts 24-year-old bid to become a member amid deepening row about migration
Switzerland's parliament has voted to withdraw its long-standing application for membership of the EU – amid a deepening row about migration. The country's National Council has backed a symbolic motion to retract the country's 24-year-old bid to join what was then the European Economic Community (EEC). Lukas Reimann from the Swiss People's Party (SVP) argued it was ‘high time' to make the move, as the country is battling with the European Commission about restricting free movement.
- The Economic Collapse Of South America Is Well Underway
The 7th largest economy on the entire planet is completely imploding. I have written previously about the economic depression that is plaguing Brazil, but since my last article it has gotten much, much worse. During 2015, Brazil’s economy shrank by 3.8 percent, but for the most recent quarter the decline was 5.89 percent on a year over year basis. Unemployment is rising rapidly, the inflation rate is up over 10 percent, and Brazilian currency has lost 24 percent of its value compared to the U.S. dollar over the past 12 months.
- ALERT: Andrew Maguire – Western Central Planners Have Finally Lost Control Of The Gold Market
Today whistleblower and London metals trader Andrew Maguire told King World News that Western central planers have finally lost control of the gold market.
- Fresh recession will cause eurozone collapse, warns Swiss bank
A recession in Europe could lead to the collapse of the eurozone, as the single currency would buckle under the political turmoil unleashed by a fresh downturn, a leading investment bank has warned. In a research note titled “Close to the edge”, economists at Swiss bank Credit Suisse warned the fate of monetary union hangs in the balance if Europe's policymakers are unable to ward off another global slump and quell anti-euro populism. “The viability of the euro is contingent on the current recovery,” said Peter Foley at Credit Suisse.
- The Trumpster Sends The GOP/Neocon Establishment To The Dumpster
Wow. Super Tuesday was an earthquake, and not just because Donald Trump ran the tables. The best thing was the complete drubbing and humiliation that voters all over America handed to the little Napoleon from Florida, Marco Rubio. So doing, the voters began the process of ridding the nation of the GOP War Party and its neocon claque of rabid interventionists. They have held sway for nearly three decades in the Imperial City and the consequences have been deplorable.
- 260,000 Austrians sign EU exit petition, forcing referendum debate in parliament
Over 260,000 Austrians have signed a petition calling for the EU exit for the country, and now the Austrian parliament must discuss a referendum on the issue. Overall, the 261,159 people who signed the petition represent 4.12 percent of the electorate. The petition was most popular in the regions of Lower Austria (where 5.18 percent of potential voters signed it) and in Carinthia (4.85 percent). The threshold for calling a debate on a potential referendum is 100,000 people.
- Jim Rogers Says 100% Probability US Is Heading for Recession; Data Backs Him Up
Media and government officials keep telling us the economy looks great, but a peek behind the curtain tells a different story. Some people do see the writing on the wall. Peter Schiff has been saying the US may well have already entered a recession. Last month, Jim Grant echoed Peter, saying the US economy likely went into recession in December 2015.
- Over 80% Of Jobs Added In January Were Minimum Wage Earners
Jobs were good; earnings were a disaster – that's the best summary of today's jobs report. As we noted earlier, February suffered the biggest ever monthly drop in average weekly earnings, because not only did hourly earnings drop but so did hours worked, resulting in far lower overall weekly wages.
- U.S. trade deficit widens as exports hit five-and-a-half-year low
The U.S. trade deficit widened more than expected in January as a strong dollar and weak global demand helped to push exports to a more than five-and-a-half-year low, suggesting trade will continue to weigh on economic growth in the first quarter. The Commerce Department said on Friday the trade gap increased 2.2 percent to $45.7 billion. December's trade deficit was revised up to $44.7 billion from the previously reported $43.4 billion. Exports have declined for four straight months.
- Big Pharma is Betting on This Presidential Candidate to Win. Donates Millions of Dollars
In the past few years we have seen price hikes of pharmaceutical drugs — the most well-known incident is of the drug Daraprim, which jumped from $13.50 to $750 per pill after being purchased by the infamous entrepreneur and pharmaceutical executive Martin Shkreli. We have seen a dramatic increase of deaths caused by prescription drugs and learned that all new pharmaceuticals coming out have 1 in 5 chance of causing a serious adverse health reaction.
- Barclays announces withdrawal from Africa
Barclays, one of the UK’s main four banking groups, used the release of its 2015 results to announce that it will divest itself of its 62.3% stake in Barclays Africa over the next two to three years. The withdrawal from Africa is one of the first decisions taken by Jes Staley, who took over as chief executive (CEO) three months ago and will re-organise Barclays around two main divisions: UK retail banking and its corporate and investment bank.
- It's Official: Canada Has Sold All Of Its Gold Reserves
One month ago, when looking at the latest Canadian official international reserves, we noticed something strange: Canada had sold nearly half of its gold reserves in one month. According to the February data, total Canadian gold reserves stood at 1.7 tonnes. That was just 0.1 per cent of the country’s total reserves, which also include foreign currency deposits and bonds. As we noted, the decision to sell came from Finance Minister Bill Morneau’s office.
- “It's A Recession Stupid” – US Factory Orders Tumble For 15th Month In A Row
In 60 years, the US economy has not suffered a 15-month continuous YoY drop in Factory orders without being in recession. Today's -1.9% YoY drop may suggest the slide is decelerating, but off the weakness in December (-2.9% MoM), January's bounce +1.6% MoM missed expectations (+2.1%) notably (and Ex-Trans decline MoM). Recession…?
- “No signs of recession” says agency that always fails to predict recession
In the middle of a heated battle against my jetlag yesterday, I finally decided to exercise the nuclear option and turn on CNBC in order to stay awake. I figured someone would say something completely ridiculous, and it would get my blood boiling enough to power through the next couple of hours. Within minutes I saw a top economist for Moody’s (one of the largest rating agencies in the world) saying that there are absolutely zero signs of recession.
- We just got the clearest sign yet that something is wrong with the US economy
We just got the clearest sign yet that something is wrong with the US economy. Markit Economics' monthly flash services purchasing manager's index, a preliminary reading on the sector, fell into contraction for the first time in over two years. The tentative February index was reported Wednesday at 49.8. That's below 50, the border between expansion and contraction.
- Power to the People – Owning Gold and Silver to Weather the Monetary Storm
Perhaps you saw the recent article about home safes selling out in Japan. This is an unintended consequence of the Japanese central bank’s negative interest rate policy. People are starting to pull their paper cash out of the banks. They are withdrawing all they can and buying personal safes to horde currency at home. The reasoning is, of course, why leave your cash in the risky banking system when you get zero return from it sitting there? In truth, Japanese banks are slowly sucking their depositors’ wealth away – charging them for the right to lend them money.
- Plunging Manufacturing Numbers Mean That It Is Time To Hit The Panic Button For The Global Economy
We haven’t seen numbers like these since the last global recession. I recently wrote about how global trade is imploding all over the planet, and the same thing is true when it comes to manufacturing. We just learned that manufacturing in China has now been contracting for seven months in a row, and as you will see below, U.S. manufacturing is facing “its toughest period since the global financial crisis”. Yes, global stocks have bounced back a bit after experiencing dramatic declines during January and the first part of February, and this is something that investors are very happy about. But that does not mean that the crisis is over. All bear markets have their ups and downs, and this one will not be any different. Meanwhile, the cold, hard economic numbers that keep coming in are absolutely screaming that a new global recession is here.
- By refusing US, India shows goodwill towards China: State media
Chinese state media has praised India’s decision to refuse to patrol the South China Sea with the US. In the second commentary within a week on the proposed India-US joint patrol issue, an article in the state-run, Global Times said: “The New Delhi government pursues pragmatic diplomacy and strives to reach a balance between the US and China. Some interpret New Delhi’s refusal (to jointly patrol the SCS) as retaliation against Washington’s approval of weapon sales to Islamabad last year.”
- New snooping laws will hand sweeping powers to EVERY police force to hack into phones and check web browser histories
New spying laws creating sweeping powers for the police to access anyone's web browser history and break into their phones have been handed to MPs. A new draft of proposed laws was presented to Parliament this afternoon after three inquiries made scores of recommendations for changes and one blasted the original as rushed and flawed. Among the changes in the re-written bill are expanded powers to break into phones and computers if there is a ‘threat to life' and enhanced rules on allowing police and security service access to records about which websites – but not specific pages – have been accessed.
- The Printing Press: A Great Way to Fool People – Peter Schiff’s Gold Videocast with Albert K Lu
In his most recent Gold Videocast for SchiffGold, Albert K Lu interviewed John Rubino, founder of DollarCollapse.com. Rubino had a pretty compelling explanation for why there wasn’t a massive, sustained economic collapse a decade ago, and why he thinks it’s still lurking on the horizon. “The reason that we’re still here, when we really should have fallen apart based on how much debt there was out there, and various other measures of instability, is that a printing press has turned out to be a great tool for fooling people.”
- Sports Authority Files for Bankruptcy and Plans to Eliminate 140 Stores
The long-speculated bankruptcy of Sports Authority is official. In a statement posted to its website Wednesday, CEO Michael Foss said that the company decided to file for Chapter 11 bankruptcy as a way to implement a financial and operational restructuring that it sees as necessary to better appeal to customers. Foss said the sporting goods retailer has identified 140 stores to close or sell in the coming months. “This was a tough decision to make, but we believe it was a necessary step in our plan to make Sports Authority an even better partner for our customers,” he wrote.
- World Trade Organization shutting down India's massive solar project is what's wrong with the world
The Jawaharlal Nehru National Solar Mission was launched on the 11th January, 2010 by the Prime Minister of India. The mission was to deploy 20,000 MW of grid-connected solar power by 2022 and reduce the cost of solar power generation in the country. Once completed, the mission would have made the country a global leader in solar energy.
- A French message to Britain: get out of Europe before you wreck it
There is, between you and us continental Europeans, a disagreement which is turning ugly. Your immense history justifies a limitless admiration for you. You were the inventors of democracy and of human rights, you dominated the world for centuries, first ruling the oceans and after that the world of finance. And when apocalypse threatened, your courage and tenacity – you held on long, American and Russian help arriving late in the day – saved our honour and freedom.
- Turkey could join the EU sooner after helping with the ‘disorderly' migrant crisis, says Merkel on visit to Istanbul
Turkey could join the European Union earlier than expected after its help in dealing with the ‘disorderly' migrant crisis, Angela Merkel signalled today. The German Chancellor arrived in Istanbul for talks with Turkish Prime Minister Ahmet Davutoglu on how to stem the flow of people from conflict in the Middle East. But a Brussels plan to allow Turks access to EU visas – in exchange for their country's help with the Syrian migration crisis – has been branded as ‘bordering on insanity'.
- Can Americans Handle Four More Years Of This?
No child (or student, or poor person, or grandchild, or debtholder, or healthy person, or retiree, or African American, or family, or homeowner, or renter) left untouched… Now that is a legacy.
- Alan Greenspan hasn't been optimistic about America in a long time
Alan Greenspan is doesn't feel good about America. In an interview with Bloomberg TV's Tom Keene and Mike McKee on Tuesday, the former Federal Reserve chair laid out an uncertain and downbeat view of the US economy. McKee asked if Greenspan thought that financial markets were right by signaling trouble for the economy. “Yep,” said Greenspan. “We're in trouble basically because productivity is dead in the water.”
- You'll have to work to 81 to have the same retirement as your parents
Workers in some parts of the UK face working the best part of a decade longer than others to maintain their current living standards when they retire, according to a report. The findings raise the prospect of some people having to “work until they drop” to sustain their current lifestyles. An average earner who starts saving for a pension aged 22 and makes the minimum statutory contributions would need to work until the age of 77 to get the sort of “gold standard” pension enjoyed by many of their parents' generation, the research from Royal London found. But the worst off will need to keep doing the day job until they're into their 80s.
- Here Comes Mandatory Gun Insurance (And A $10,000 Fine If You Don’t Buy It)
Politicians nationwide have discovered a sneaky new way to discourage gun ownership: mandatory insurance. Laws that would force gun owners to purchase liability insurance have been proposed in three states and the city of Los Angeles, Insurance Business America reported. Under the proposals, gun owners who did not buy insurance would face fines up to $10,000. The laws also would require individuals to prove they have insurance prior to buying a firearm.
- China Faces 15 Trillion Bombshell As Shadow Banking Sector Collapses
We’ve spent more time than most documenting China’s wealth management product problem. WMPs are part and parcel of Beijing’s sprawling shadow banking complex which, until 2014 that is, helped pump trillions of yuan into China’s economy and shouldered the burden when it came to propping up the most important economy on the planet. But WMPs are dangerous. In fact, we flagged them as an 8 trillion black swan back in August on the way to asking what would happen if China’s shadow banking sector were to collapse altogether.
- The Game Changed in Venezuela Last Night – and the International Media Is Asleep At the Switch
Listen and understand. The game changed in Venezuela last night. What had been a slow-motion unravelling that had stretched out over many years went kinetic all of a sudden. What we have this morning is no longer the Venezuela story you thought you understood. Throughout last night, panicked people told their stories of state-sponsored paramilitaries on motorcycles roaming middle class neighborhoods, shooting at people and storming into apartment buildings, shooting at anyone who seemed like he might be protesting.
- BRICS Bank African center opens in March
The BRICS New Development Bank (NDB) will open its Africa Regional Center in Johannesburg next month, South African Finance Minister Pravin Gordhan said on Wednesday. The BRICS Bank is looking at local funding solutions, such as tapping financial and capital markets in BRICS nations, NDB President Kundapur Vaman Kamath has said. South Africa’s first instalment of two billion rand (about $132 million) was paid in December last year, and the budget makes provision for South Africa’s further commitments over the medium term, Gordhan said in his 2016 budget speech in Parliament.
- ‘Gold is the new black’ with best start to a year since 1980
Banks and pundits are singing gold’s praises as it leaps in 2016. The chart on the articles page from The Economist says gold GCJ6 has gotten off to its best start to a year in 35 years. The safety play is up 15% in the year to date as of Friday, helped by haven demand amid dives by stocks, crude oil and other assets.
- American Gold and Silver Eagle Sales Continue at Torrid Pace
The demand for gold and silver bullion coins surged in the last half of 2015, and it has not abated so far this year, despite a rally in the price of both metals. Last year, demand was so strong the US Mint sold out of American Silver Eagles in July. Inventory was replenished in August, but the coins were on weekly allocations of roughly 1 million ounces for the rest of the year. The mint set a record for Silver Eagle sales in 2015, with the final total coming in at 47 million ounces.
- They Can Already Hack the iPhone — FBI’s Public Display is Propaganda to Sell You the Police State
The apparent battle between Apple and the FBI at least tells us that the post-Snowden privacy debate is still alive. The subject of the controversy is an iPhone belonging to one of the San Bernardino shooters, and the FBI did not choose this case randomly. If the surveillance state is to have any hope of gaining their vaunted “backdoor” into the electronic devices of everyone, then preying on the fear of terrorism has the biggest chance of success.
Latest News From February 26, 2016 to March 4, 2016:
- ALERT: Paul Craig Roberts Just Warned The Global Financial House Of Cards May Not Make It Through This Year
Today former U.S. Treasury Secretary Dr. Paul Craig Roberts warned King World News that the financial house of cards may not make it through this year. Dr. Paul Craig Roberts: “Today the Federal Reserve’s policy is focused on saving a handful of very large banks. These are very huge conglomerates that financial deregulation allowed to become so concentrated that they are just massive institutions. And the belief is that if one of them were to fail, the consequences would be that the entire financial system would fail…
- Economic Recovery? 13 Of The Biggest Retailers In America Are Closing Down Stores
Barack Obama recently stated that anyone that is claiming that America’s economy is in decline is “peddling fiction“. Well, if the economy is in such great shape, why are major retailers shutting down hundreds of stores all over the country? Last month, I wrote about the “retail apocalypse” that is sweeping the nation, but since then it has gotten even worse. Closing stores has become the “hot new trend” in the retail world, and “space available” signs are going up in mall windows all over the United States. Barack Obama can continue huffing and puffing about how well the middle class is doing all he wants, but the truth is that the cold, hard numbers that retailers are reporting tell an entirely different story.
- House Republicans seek to open up national forests to mining and logging
Congress is to consider two bills that would allow states to hand over vast tracts of federal land for mining, logging or other commercial activities – just weeks after the arrest of an armed militia that took over a wildlife refuge in Oregon in protest at federal oversight of public land. The legislation, which will be presented to the House committee on natural resources on Thursday, would loosen federal authority over parts of the 600m acres (240m hectares), nearly one-third of the land mass of the US, it administers.
- With 269 Stores Closing, Is this the Beginning of the End for Walmart?
All great empires eventually fall. This is as true in retail as it is in geopolitics. Often the descent into oblivion takes decades. A&P, which was once such a formidable market power that it was the subject of antitrust hearings in Congress, began to falter in the 1950s, some 80 years after cloning its first store. At the time, it was by far the largest grocer in the country. It would remain the industry leader for another quarter of a century, even as its stores seemed increasingly outdated and its corporate practices inexplicably unable to keep up. After several rounds of store closures in the 1970s and 1980s, and a bankruptcy filing in 2010, A&P finally threw in the towel for good just last year. By then, it was a two-bit player in the grocery business, its once continent-spanning empire now confined to the Northeast.
- End of the British Army? EU plots ‘scandalous’ military merger if UK votes to stay in
THE EU is to launch a £3 BILLION defence research and development programme with the ultimate aim of merging the continent's militaries into one gargantuan Euro army, Express.co.uk can exclusively reveal today. Brussels bureaucrats are railroading through contentious plans to vastly expand the European Union’s military scope which could ultimately end with the British army being subsumed into a vast continental force.
- Finland Busts Key Refugee Myth: They Are Mostly Male and Not From Syria
The head of Finland's Immigration Services asylum unit, Esko Repo, and communications chief Hanna Kautto told the Finnish news outlet Yle that out of the 19,632 refugees that have arrived in Finland this year, over 15 thousand are adult males. The number of female migrants totals 2,816 and there are also about 2,000 children travelling with adults as well as roughly one thousand unaccompanied minors. Furthermore, only 409 of the refugees came from Syria, with the majority of the migrants – nearly 14 thousand people – arriving from Iraq.
- With twice the debt of California, Ontario is now the world’s most indebted sub-sovereign borrower
Ontario, the world’s most indebted sub-sovereign borrower, is ploughing ahead with Canada’s most ambitious infrastructure plan — risking the censure of Standard & Poor’s and underperformance for its $307 billion of bonds. The nation’s most-populous province is keeping a goal of spending $130 billion over the next decade on work such as roads and mass transit in Toronto even after S&P dropped its credit grade this month to the lowest level ever. Yield spreads on some of the province’s debt reached the widest since January after the ratings move.
- The Minimum Wage Killed 1 out of 11 Jobs on This Tropical Island
Congress is considering potential responses to Puerto Rico’s depression and fiscal crisis. Fiscal conservatives are considering whether outside oversight by a “control board” would force feckless local legislators to make difficult choices, such as consolidating rural schools and laying off bureaucrats. However, if Congress gives the board authority only to cut government spending and raise taxes, it will be unable to clear out the failed policies that have choked growth in Puerto Rico.
- An Escalating War on Cash
On February 16th, The Washington Post printed the article, “It’s time to kill the $100 bill.” This came on the heels of a CNNMoney item, the day before, entitled “Death of the 500 euro bill getting closer.” The former cited a recent Harvard Kennedy School working paper, No. 52 by Senior Fellow Peter Sands, concluding that the abolition of high denomination notes would help deter “tax evasion, financial crime, terrorist finance and corruption.” In recent days, former Treasury Secretary Larry Summers, ECB President Mario Draghi, and even the editorial board of the New York Times, came out in support of the elimination of large currency notes. Apart from the question as to why these calls are being raised now with such frequency, the larger issue is whether these moves are actually needed or if they merely a subterfuge for more complex economic manipulations by central banks to extend control over private wealth.
- China rules out weakening yuan to boost trade
China's central bank chief promised Friday to avoid weakening its yuan to boost sagging exports as he tried to reassure nervous financial markets about his government's handling of its economy and currency at the start of a closely watched gathering of global finance officials. Beijing wanted to use the gathering of finance ministers and central bankers from the Group of 20 rich and developing countries to promote its campaign for a bigger voice in managing global trade and finance. Instead, the communist government is scrambling to defend its reputation for economic competence following stock market and currency turmoil.
- BRICS NDB, Chinese Gov't Sign Agreement Setting Shanghai as Bank's HQ
Kundapur Vaman Kamath and Shanghai Mayor Yang Xiong signed a memorandum of understanding with the municipality on the terms of the NDB’s accommodation. “We hope that with the support of the government of China and other BRICS countries, as well as the Shanghai government, the New Development Bank will soon become a new model of a multilateral development institution operating openly and with high efficiency,” Wang said at a press conference.
- A revolt is growing as more people refuse to pay back student loans
Remember those 15 people who refused to repay their federal student loans? Their “debt strike” has picked up 85 more disgruntled borrowers willing to jeopardize their financial future to pressure the government into forgiving their student loans. And the government is starting to listen. The Consumer Financial Protection Bureau has invited the group to Washington on Tuesday to discuss their demand for debt cancellation. Although the CFPB doesn’t have the power to grant that request, the agency’s overture shows that the strike is being taken seriously.
- Russian-Japanese Ties Develop Despite Sanctions – Russian Trade Minister
Russia’s economic relations with Japan are expanding despite anti-Russia sanctions, Russian Industry and Trade Minister Denis Manturov said in an interview with Japanese media Saturday. “The situation is changing, but to interrupt dialogue in foreign trade and economic cooperation is impossible. Even under sanctions the Russian-Japanese relations are developing,” Manturov told the Yomiuri Shimbun daily.
- Apple’s lawyer: If we lose, it will lead to a ‘police state’
Apple’s attorney painted a scary picture if Apple loses its fight with the FBI. In an interview with CNNMoney’s Laurie Segall on Friday, Ted Olson warned of a government with “limitless” powers that could “listen to your conversations.” Olson said the demands would mount.
- Paul Craig Roberts Warns Of Massive Social Instability And Nuclear War
Today former U.S. Treasury Secretary Dr. Paul Craig Roberts spoke with King World News about massive social instability and nuclear war. Dr. Paul Craig Roberts: “The U.S. has this drive for world hegemony, but they are confronted with Russia and China, and on a regional basis, Iran and Syria. So the U.S. can’t exercise this hegemony because these countries are in the way…
- Chicago PMI Collapses From ‘Mysterious' January Bounce As Employment Crashes To 7 Year Lows
Following the biggest beat on record in January jumping to 55.6, Chicago PMI collapsed in February to a stunning 47.6 – below the lowest estimate from economists. The entire report is a disaster with New orders tumbling, production sharply lower, and employment contracting for the 5th month in a row – to its lowest since March 2009. As one respondent warned, business was just “limping along at the moment with little promise in sight.” From one-year high “HOPE” to near 7 year low “NOPE”…
- Pending home sales fell 2.5 pct in January
The winter wallop may have chilled housing activity in some parts of the country, but overheated home prices are really what are slowing sales nationwide. Home buyers signed 2.5 percent fewer contracts in January to buy existing homes compared to December. The expectation had been for a slight gain. The so-called pending home sales index from the National Association of Realtors, an indicator of future closed sales, is now just 1.4 percent higher than it was in January of 2015. Pending sales have been higher annually for 17 straight months, but this is the second smallest gain in that time.
- Another financial crash is ‘certain’, former Bank of England governor warns
We’re still crawling out from the dark days of 2008’s crash, hoping the global economy has somehow repaired itself. Unfortunately, the former Bank of England governor Mervyn King says it hasn’t – and it’s not a case of if the next one happens, but when. Lord King, who led the bank between 2003 and 2013, had a grim warning for global leaders unless they reformed the system, saying another financial crisis is ‘certain’ and will come ‘sooner rather than later’. He said the reason for the global crisis eight years ago was the system itself, and not greedy bankers.
- Mainstream Waking Up to Reality; Now Saying “Buy Gold”
Just a few months ago, mainstream analysts were calling gold a “barbaric relic.” Now all of a sudden, they are saying, “Buy gold!” Last Friday, Deutsche Bank issued a note asserting that with emerging economic risks and market turmoil, signs point in gold’s favor: “There are rising stresses in the global financial system…Buying some gold as ‘insurance’ is warranted.”
- “There’s never been a change this big, nor so many people unprepared.”
I had an amazing time this weekend sharing the stage at an investment conference in Miami, with other speakers like Robert Kiyosaki, Peter Schiff, and G. Edward Griffin among others. During a panel on the future of money and banking we discussed how the financial system is rapidly losing control of its own product, i.e. money, in the same way that the music industry has lost control of its product. In the past there used to be a handful of large record labels that controlled the distribution of music across the world. In the same way, our financial system was set up for a handful of banks to tightly control the distribution of money across the world to the point that no financial transaction could occur without a bank inserting itself in the middle.
- Welcome To The Third World, Part 17: Was Middle-Class Retirement Just A Credit Bubble Fantasy?
One of the jarring — and until recently underreported — aspects of those seemingly-positive recent US jobs reports is the increasing skew towards older workers. Most new jobs have gone to people who in better times would be leaving to live off their savings. Now they’re coming back, frequently taking jobs they wouldn’t consider if money wasn’t so tight.
- Fed's Dudley sees risks to U.S. economic outlook tilting to downside
An influential Federal Reserve official on Tuesday said he sees downside risks to his U.S. economic outlook, an assessment that could flag a longer pause before the Fed's next interest-rate hike than he and his colleagues had earlier signaled. “At this moment, I judge that the balance of risks to my growth and inflation outlooks may be starting to tilt slightly to the downside,” New York Federal Reserve President William Dudley said in remarks at a conference in Hangzhou, China sponsored by the People's Bank of China and the New York Fed.
- Nomi Prins Just Issued A Major Warning
By Nomi Prins, Keynote Speaker at the recent IMF, World Bank, Fed Conference. February 25 (King World News) – Throughout last year, I predicted the Federal Reserve wouldn’t raise rates by September and that it was unlikely to do anything to seriously rock the rate boat at all. That turned out to be accurate…
Latest News From February 19, 2016 to February 25, 2016:
- Pope Francis Appoints Population Control Extremist to Vatican Post
A scientist who believes the world is overpopulated by 6 billion people has been appointed by Pope Francis to the Pontifical Academy of Science. The Holy See Press office made the announcement today that besides being one of four official presenters of the Pope’s controversial encyclical on the environment Thursday in Vatican City, Hans Joachim Schellnhuber is to join 80 other scientists who are official advisers to the Vatican on scientific matters.
- Cramer: Fed blind to recession signs everywhere
Everywhere Jim Cramer goes, people ask him if the U.S. is headed into a recession. And then he hears other whispers, saying that the Fed feels the need to raise rates and maybe it will happen in March. “When you look beyond the market's tight linkage to the price of oil, the idea that we could be headed into a recession has become a powerful theme, a whispered undercurrent in this environment that surfaces whenever oil takes a dive,” the “Mad Money” host said.
- 1 in 4 Americans on verge of financial ruin
The rich keep getting richer. The rest of us aren’t so lucky. According to a survey released Tuesday by Bankrate.com of more than 1,000 adults, nearly one in four Americans have credit card debt that exceeds their emergency fund or savings. And that’s partially because many people, in addition to their debt, don’t have a dime in their emergency fund at all: another Bankrate survey released earlier this year found that 29% of Americans have no emergency savings at all.
- Riyadh on the Brink: US Must Prepare for Collapse of its Mideast ‘Lynchpin'
The United States must start thinking of ways to mitigate the damage from the approaching collapse of the current Saudi Arabian monarchy. A codependence between the Kingdom of Saudi Arabia and the US has existed for decades. A scheme in which oil from the Saudis was exchanged for US military might worked well for both. It worked so well, in fact, that the US turned a blind eye to consistent human rights violations in the kingdom, as well as the spread of Wahhabi religious extremism.
- Jim Rogers Warns “Governments Plan Is To Destroy The People Who Save”
“Everybody should be worried.. and be prepared,” warns legendary investor Jim Rogers, as he sees the market “facing a bigger collapse than in 2008,” and the central banks will be unable to kick the can much longer. “This is the first time in recorded history where you have Central Banks & governments setting out to destroy the people who save & invest,” Rogers exclaims and “the markets are telling us that something is wrong – we're getting close.”
- And Now We Have A Services Recession: Markit Services PMI Crashes Into Contraction
Following this week's ongoing demise of the US manufacturing sector, tumbling to its weakest since October 2012, Markit US Services PMI collapsed into contraction at 49.8, massively below expectations of 53.5. This is the weakest level for the last pillar standing in the US recovery since the government shutdown in 2013, and as Markit even admits, “slumping business confidence and an increased downturn in order book backlogs suggest there’s worse to come.”
- Fed's Lacker says still logical to expect rate hikes this year
Ongoing strength in the U.S. job market could give the Federal Reserve justification for multiple interest rate increases this year, Richmond Fed President Jeffrey Lacker said on Wednesday. Nearly two months of falling global equity prices and mounting concerns over a global economic slowdown have fostered doubts that the U.S. central bank will raise rates anytime soon. “I still think prospects for rate increases this year is the logical” view, Lacker said in a presentation to a business school in Baltimore, adding that economic data did not indicate that a recession was imminent in the United States.
- New home sales fall sharply to 494K – USD extends falls
Sales of new homes fell 9.2% in January to 494K, much worse than predicted and very different to yesterday’s report about existing home sales. New home sales in the US were expected to rise 4.4% to 544K. Also the average home sale price is down: $278K against $292K beforehand.
- Dire Conditions Are Now Spreading Across The Globe
With stocks still struggling and gold surging nearly $30 at one point in today’s trading session, dire conditions are now spreading across the globe.
- Peter Schiff: Obama “Peddling Fiction” As Unemployed Tops 100 Million People
In the video in the link above, President Obama gives one of the most disingenuous speeches he has ever given. Either the man is a pathological liar, or in the alternate universe where he lives, there really is an economic recovery, and unicorns really do run free! Neither of those things helps any of the now 100 million Americans living in REALITY who are not currently working. While all the sane people in our weary nation are bracing for a global economic reset, Obama is flat out “peddling fiction,” as he put it during his State of the Union speech. There is no other way to say it. Period. It’s unconscionable that Obama is STILL out in front of the cameras taking credit for a recovery when 1/3 of our entire nation’s POPULATION is out of work. Listen to him spew his garbage!
- UK downgrading of human rights sets dangerous precedent, says Amnesty
Britain is setting a dangerous precedent by undermining human rights and contributing to a worldwide “culture of impunity”, Amnesty International has said in its annual report on the state of human rights. Plans to scrap the Human Rights Act, the UK’s absence from EU refugee resettlement schemes, proposed new spying laws and the alleged downgrading of human rights as a Foreign Office priority in favour of commercial deals are all cited by the group as evidence of a trend.
- China Is Making a Major Play for American Farms and Farmland
The American farmer is revered in our culture. He—the mythical American farmer is invariably a man—is in many ways a professional embodiment of values, such as individualism and hard work, that are considered part of the national identity. With their backbreaking work, farmers settled the growing West through the 1862 Homestead Act. It’s not a stretch to say that farmers, riding the wave of manifest destiny, built the United States. Today, they continue to feed it.
- The Syrian Ceasefire Has Revealed Russia's Superpower Status
Yesterday’s evening news in Russia was dominated by one story: the announcement by Vladimir Putin on national television that the United and Russia had concluded an agreement to facilitate the start and supervise the implementation of a ceasefire in Syria between government and opposition forces, set to begin on 27 February. The agreement was sealed by a telephone conversation between Vladimir Putin and Barack Obama that took place shortly before the broadcast. Putin’s televised address was less than 10 minutes long and it has been rebroadcast in entirety on state television at hourly intervals. Understandably, it has been the number one topic in the Russian print media this morning.
- Don't Show This Chart To Experian: Subprime Auto Delinquencies Hit Highest Level Since 2010
For those unfamiliar, Melinda is Experian’s senior director of automotive finance and she’s never, ever worried. Or at least not that she lets on. “We're not seeing anything that would be a red flag,” she said earlier this month in response to data that showed the percentage of auto loans made to buyers with the poorest credit ratings is growing faster than the rest of the auto finance market.
- The Addict Needs More Drug; Is Permanent Quantitative Easing in Our Future?
Central bankers want you to think they have all the answers. They talk about their policy “tool kits” as if they can just reach in and find the proper solution for any possible economic scenario. But if you peer behind the curtain, it becomes apparent they may not really know what they’re doing after all. In fact, with a recession looming on the horizon, there are some signs of desperation among economic central planners.
- Consumer confidence falls to seven-month low
Consumers confidence fell in February to the lowest level in seven months, as American became a bit more pessimistic about business conditions. Turmoil in stock markets probably also increased anxiety. The consumer confidence index dropped to 92.2 from a revised 97.8 in January, the Conference Board said Tuesday. Economists polled by MarketWatch had projected the index to fall to 96.9.
- Richmond Fed Slides Back Into Contraction As New Orders Collapse
With the biggest drop in New Orders since September, Richmond Fed Manufacturing survey dropped to -4 (missing expectations of +2), hovering at its weakest in over 3 years. Across the board the components were weaker with order backlogs and shipments plunging, average workweek and wages dropping, and capacity utilization worst since October. Prices (paid and received) dropped notably as future expectations for wages, workweek, and employees all fell.
- Venezuela Exported 36t Of Its Official Gold Reserves To Switzerland In January
Remarkably, after Venezuela repatriated 160 tonnes in official gold reservesfrom 25 November 2011 until 30 January 2012, it started to slowly export this gold to the world’s largest gold trading and refining hub, Switzerland, in 2015. How much unencumbered official gold reserves Venezuela has left is unknown.
- Safes Sell Out In Japan, 1,000 Franc Note Demand Soars As NIRP Triggers Cash Hoarding
Negative rates may not have found their way to bank deposits in most locales (yet), but that doesn’t mean the public isn’t starting to see the writing on the wall. At first, NIRP was an anomaly. An obscure policy tool that most analysts and market watchers assumed would be implemented on a temporary basis in a kind of “let’s see if this is even possible” experiment with an idea that, from a common sense perspective, makes no sense.
- Four US States Officially in Recession; Data Points to Broader Problems
With four states officially in recession, and economic data continuing to point toward a broader downturn, it’s getting increasingly difficult for officials to sell the illusion of a strong US economy. Peter Schiff has been saying for weeks that the US may already be in a recession. Recently, Jim Grant appeared on CNBC’s Closing Bell and echoed Peter’s sentiments, saying the US likely went into recession in late December. And while officials at the Federal Reserve keep insisting the US economy remains strong, some mainstream analysts have started sounding recession warning bells as well. In fact, the number of mainstream economists predicting a recession within the next 12 months continues to rise.
- Major blow for Brexit campaign as US rules out UK-only trade deal
The United States has ruled out a separate trade deal with UK if it leaves the European Union, in a major blow to Brexit campaigners. President Obama’s most senior trade official said that America is “not in the market” for a free trade deal with Britain alone, and warned British firms could face crippling Chinese-style tariffs outside the EU.
- PMI Plunges – The Last Time US Manufacturing Was This Weak, Bernanke Hinted At QE3
On the heels of weakness in the rest of the world's PMIs, US Manufacturing just printed 51.0 (missing expectations of 52.4) and tumbling to its lowest since October 2012… followed rapidly by Bernanke hinting at QE3. While Markit does ‘blame the extreme weather', it notes however that “every indicator from the flash PMI survey, from output, order books and exports to employment, inventories and prices, is flashing a warning light about the health of the manufacturing economy.”
- An Alarm Goes Off Threatening The “Strong U.S. Jobs” Myth: Withheld Income Taxes Are Stalling
Of all the indicators that the Fed has presented to justify its rate hike mentality and to validate that the US economy remains on a growth path despite clear recessionary signals from both the manufacturing sector and the dramatic tightening in financial conditions in recent months, Yellen's preferred metric also happens to be the most lagging one: nonfarm payrolls and the unemployment rate, both of which supposedly signal the collapsing slack in the labor market and a jump in wages that has been “just around the corner” for years.
- Paul Craig Roberts – The Frightening Truth About What Is Really Happening In The United States
With continued uncertainty in global markets, today former U.S. Treasury official Dr. Paul Craig Roberts covers the frightening truth about what is really happening in the United States.
- You Are Here
It's definitely different this time… The 2008 analog lines the current trajectory up with August 2008 right after Treasury Secretary Paulson told the world reassuringly that: “Our economy has got very strong long-term fundamentals. And you know, your policy-makers and regulators here – we're very vigilant.” And we all know what happened next…
- Oil rig count collapses for 9th straight week
The US oil rig count tumbled 26 to 413 this week, according to driller Baker Hughes. It's the lowest level since December 2009. The total count of oil and gas rigs fell 27 to 514, as only one gas rig was shut down. Last week, the oil rig count fell by 28, while the combined count of oil and gas rigs dropped 30. This was the third straight week of a sizeable drop in the rig count, each by at least 26. It's the biggest three-week drop in a year.
- Higgins says unaccountable forces are running EU
Unaccountable forces removed from democratic control are today in control in the European Union, President Michael D Higgins has declared in one of the most pointed speeches of his term in office.
- Marc Faber Just Accused Central Banks Of Halting The Decline In Global Stock Markets
On the heels of the recent rally in world stock markets, today legendary Marc Faber spoke with King World News and just accused central banks of halting the decline in global stock markets. Marc Faber: “I believe that stock markets around the world will end the year lower, but it will depend on how much money the central bankers will print. You don’t know how far these mad professors will go. They can launch QE4 with $500 billion a month, and in theory they could buy the whole stock market…
- Global leaders must act now as fresh downturn looms, warns OECD
Global leaders must take “urgent” action to stop the world becoming stuck in a low-growth trap, according to the Organisation for Economic Co-operation and Development. The OECD slashed its growth forecasts across the board on Thursday as it urged policymakers to deploy a “full set of tools” to prevent another slowdown. Higher investment, loose monetary policy and structural reforms would all be needed to boost the recovery and ward off the financial stability risks “plaguing” the economy, it said. The OECD slashed its growth forecasts for all major economies apart from China, which the think-tank said was also facing challenges.
- Pope Francis Rips Capitalism, American Immigration Policy at Mexican Border
Pope Francis, apparently desperate to reach out to the Catholic Church’s growing base in Latin America, spent the day slapping Americans in the face from across the US-Mexico border. In Ciudad Juarez, one of the most violent cities in the Western Hemisphere thanks to the drug cartels, the pope walked up a ramp covered in flowers toward a cross “erected… in memory of migrants who have perished trying to reach the United States just a stone’s throw away,” according to Reuters.
Latest News From February 12, 2016 to February 18, 2016:
- The $100 Bill Could Be the Next Victim in the War on Cash; Don’t Become One Too
The war on cash heated up this week when a former Obama economic adviser/ex-Treasury secretary floated the idea of eliminating the $100 bill. Lawrence Summers called for death to the Benjamins in a post on his Washington Post blog titled It’s Time to Kill the $100 Bill. The post announced the release of a paper by Harvard’s Mossavar Rahmani Center for Business and Government senior Fellow Peter Sands arguing that governments should stop issuing high-denomination currency such as 500 euro notes and $100 bills. The paper even proposed withdrawing such currency them from circulation.
- 2016 Reveals Banks Shaky & Gold Solid-James Turk
Gold expert James Turk says the banks are in trouble again. One of the biggest troubled institutions is Germany’s Deutsche Bank, and Turk contends, “It is quite alarming the shares of the stock are basically where they were in the lows of 2008. It’s at the bottom of that year’s financial crisis, and here we have not even started the financial crisis yet. The stock is back to those prices of seven or eight years ago. It makes you wonder what is yet to come. You are seeing publicity stunts like Jamie Dimon buying $25 million worth of JPMorgan stock. It reminds me of what we saw back in the 1930’s. In the history books, guys would go out and buy shares of their stock to convince people that things were okay. The market is telling us that people want to be in safer things, and it looks like gold’s trend has finally turned after a four year correction. . . . It looks like we are going to be heading higher.”
- Stocks Cut in Half & Gold Doubles in 2016-Bo Polny
Market cycle analyst Bo Polny says stocks are going to take a beating, and gold is going to shine in 2016. Polny contends, “What we’ve seen happen so far in gold is just a warm up. We are not even close to see movements in gold, this is just the start. . . . What’s coming is a transfer of wealth. When you are looking at a transfer of wealth, it means a huge financial shift in the landscape. . . . You are going to have the stock market crash this year of a minimum of 50% . . . and gold will double. A $5,000 stock investment, after it is cut in half, will only buy you one ounce of gold that will be $2,500, and that will happen this year.”
- 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.
- Philly Fed index shows manufacturing contracts for sixth straight month
A early indication of manufacturing conditions in February indicated contraction for the sixth straight month, according to data released Thursday. The Philadelphia Fed said its manufacturing barometer of regional manufacturing activity rose slightly to negative 2.8 from negative 3.5. That was slightly ahead of the MarketWatch-compiled forecast for negative 3. Readings below zero indicate a contraction of activity.
- US Fed hawk now says ‘unwise' to continue rate hikes
It would be “unwise” for the US Federal Reserve to continue hiking interest rates given declining inflation expectations and recent equity market volatility, St Louis Fed president James Bullard said on Wednesday (Feb 17) in comments that mark a stark change of direction for one of the Fed's more hawkish inflation foes.
- Britain outside the EU would stand tall as a free and prosperous nation
In four months’ time the British people are likely to be asked to take the most important decision for the future of our country in their lifetimes. It is not about Europe as such. It is about whether we should remain within a deeply misguided and troubled institution known as the European Union. No one could have been clearer about the problem than David Cameron, in his Bloomberg speech three years ago, when he committed himself to securing a “fundamental, far-reaching reform” of the EU. He has conspicuously failed to do so.
- ALERT: Is This About To Ignite A Terrifying Global Storm?
On the heels of a reprieve in world markets, is this about to ignite a terrifying global storm? And finally, this is from today’s note from legend Art Cashin: Rumblings In The Euro Zone – Yra Harris, the sage of the CME, brought a potential seismic event in euro sovereign bonds to light in his blog earlier this week.
- The ban on cash is coming. Soon.
This is starting to become very concerning. The momentum to “ban cash”, and in particular high denomination notes like the 500 euro and $100 bills, is seriously picking up steam. On Monday the European Central Bank President emphatically disclosed that he is strongly considering phasing out the 500 euro note. Yesterday, former US Treasury Secretary Larry Summers published an op-ed in the Washington Post about getting rid of the $100 bill. Prominent economists and banks have joined the refrain and called for an end to cash in recent months.
- Foreign Officials Sell A Record $48 Billion In U.S. Treasurys In December
There has been much speculation whether foreign official institutions (central banks, SWFs, reserve managers and so on) are selling Treasurys or equities, or both as part of the Quantitative Tightening phenomenon. Moments ago, courtesy of the latest TIC data we have an answer: based on the monthly flow report breaking down Treasury transactions between foreign official and private entities, in December the far more important, former, group sold $48.1 billion in US Treasurys: the highest single monthly outflow on record.
- Gold: Not Just Another Commodity, A Safe-Haven in Times of Uncertainty
Mainstream media pundits, economists, and journalists alike love to lump gold in with other commodities. They put it in the same category as oil, copper, wheat, natural gas, and other things that come out of the ground. But while gold is in fact a metal you must dig up, it is a mistake to call it “just another commodity.” Gold’s recent price performance shows that it is anything but. Gold is a superior safe-haven asset to own in times of financial duress and uncertainty.
- Tony Blair: Britain must give up MORE powers to Brussels and mass migration ‘GOOD for UK'
TONY Blair has called alled for Britain to surrender MORE powers to unelected Brussels bureaucrats and insisted mass migration from eastern Europe has been GOOD for the country as he made a bizarre case for staying in the EU.
- John Paulson Pares Bet on Gold in Fourth Quarter
Hedge-fund manager John Paulson pared his long-held bet on gold in the fourth quarter, according to a filing Tuesday. Paulson & Co. reduced its holdings in an exchange-traded fund that follows the price of gold by $400 million, the filing indicated. The move may have been a costly one: Gold futures soared last week to their highest level in a year, and the precious metal has been one of the top performers in 2016.
- Oil prices crash after Saudia Arabia and Russia agree to freeze production
The world's two most powerful oil producers have reached a tentative agreement to freeze oil production at their current levels, dashing hopes of a supply cut for the world's glutted market. Meeting in Doha, Russia, Venezuelan and Saudi Arabian oil ministers reached the deal on Tuesday morning after months of speculation about a Russia-Saudi entente to limit output and help stabilise prices.
- Stocktake: Looking for investor capitulation
Looking for investor capitulation Market sentiment may be awful but investors are not yet “max bearish”, indicating any bounces should be sold. That line may sound familiar to StockTake readers – we used it three weeks ago, but it remains true today.
- Empire Fed Contracts For 7th Straight Month, Hovers At 7-Year Lows
The Empire Fed Manufacturing survey has been in contraction (below 0) since July 2015 and while February's -16.64 print was above January's -19.37, it was dramatically worse than the expected -10.0. New Orders and Shipments remain in contraction as both prices paid and recived tumbled. Hope improved modestly but remains markedly below December levels, as CapEx spending expectations weakened once again.
- Collapse Of The Paper Gold & Silver Market May Be Close At Hand
There is something seriously wrong taking place in the markets today. This is also true in the paper gold and silver markets as well. For a paper precious metals futures market to function properly, there has to be ample supplies of physical metal. However, the ongoing trend of falling precious metal inventories points to big trouble in the paper gold and silver markets.
- A Cash Ban Has Already Begun…
When looking over these data points, the first thing that jumps out at the viewer is that the vast bulk of “money” in the system is in the form of digital loans or credit (non-physical debt). Put another way, actual physical money or cash (as in bills or coins you can hold in your hand) comprises less than 1% of the “money” in the financial system. As far as the Central Banks are concerned, this is a good thing because if investors/depositors were ever to try and convert even a small portion of this “wealth” into actual physical bills, the system would implode (there simply is not enough actual cash).
- Goldman Channels FDR's `Nothing to Fear' With Sell Gold Call
Goldman Sachs Group Inc. says it’s time to bet against gold as bullion’s rally to the highest in a year isn’t justified, backing the bearish call with a comment from a former U.S. leader in a report that was issued, appropriately enough, on Presidents’ Day. Gold will slump to $1,100 an ounce in three months and $1,000 an ounce in 12 months, analysts including Jeffrey Currie and Max Layton wrote in the report that was dated Feb. 15 and received on Tuesday. It was headlined with a remark from former President Franklin D. Roosevelt.
- Swiss Won't Rethink 1,000-Franc Note as Draghi Hails Crime Fight
Swiss officials have no plans to follow the European Central Bank and consider withdrawing their highest-denomination banknote to help fight crime. A day after ECB President Mario Draghi told lawmakers that there’s “increasing conviction” around the world that such bills are used for illegal purposes, Swiss National Bank Spokesman Walter Meier said by telephone that his institution “isn’t thinking about getting rid of the 1,000-franc note.”
- Negative Interest Rates a Positive for Gold
Negative interest rates are becoming more and more in vogue and that could be good news for gold. Last week, Sweden’s central bank plunged a key interest rate even deeper into negative territory. Riksbanken slashed the rate from negative 0.35% to negative 0.50%. Many analysts anticipated the rate reduction, but the magnitude of the cut caught most by surprise.
- ECB chief says bank is ready to act in March if needed
The European Central Bank is ready to ease policy further in March, President Mario Draghi said on Monday, highlighting risks from financial market volatility, a global slowdown in growth and low oil prices. The ECB will examine risks emanating from weaker emerging market growth and look at whether plunging crude prices along with market turbulence could derail its efforts to boost inflation, Draghi told lawmakers in the European Parliament.
- Morgan Stanley agrees to $3.2 billion settlement for selling risky mortgages
Morgan Stanley on Thursday agreed to pay more than $3.2 billion to settle allegations by state and federal authorities that it downplayed the risk of mortgages it sold in the years before the financial crisis. In announcing the settlement, New York Attorney General Eric T. Schneiderman said the bank’s actions contributed to the collapse of the housing market.
- Japan's economy shrinks 1.4 per cent
Japan's economy shrank more than expected in the final quarter of last year as consumer spending and exports slumped. The result has added to headaches for policymakers already wary of damage the financial market rout could inflict on a fragile recovery. Gross domestic product contracted by an annualised 1.4 per cent in October-December, bigger than a market forecast for a 1.2 per cent decline and matching a fall marked in the second quarter of last year, Cabinet Office data showed on Monday.
- Is Gold Making A Triumphant Comeback?
Analyzing the long term economic and market cycles, the probability is very high that the stock market downturn may eventually be the worst since the Great Depression. Of course, there are many more safety nets now, and the central banks of the world will coordinate in order to soften a decline. But the Fed and other central bankers are not the solution. They are the problem. All the ‘safety nets’ have to be paid for with money the governments don’t have. Therefore, it will have to be financed with ‘money creation’ by their central banks.
- Investors are piling into gold as fear stalks markets
Gold is back in favor with investors running scared of global market turmoil. Physical gold prices have jumped 16% so far this year, and the Gold Shares (GLD) exchange-traded fund (ETF) is up nearly 13% — a handy return compared to big losses on most stock markets. Demand for gold as an investment was up 8% in 2015, and there's evidence that trend is accelerating this year.
- The stage is now set for a basic income for all
It has been a breathtaking week for social policy in Canada. The stage is now set for a serious discussion about the merits of a basic income guarantee, and many of the actors have been cast in their leading roles. Jean-Yves Duclos, federal minister of families, children and social development, stated to both CBC Radio and the Globe and Mail last week that a guaranteed minimum income is a policy worthy of discussion, once the promised enhancements to child tax benefits occur — an existing kind of minimum income for families with children.
- Sunny Nevada Just Killed the Solar Industry with 40% Tax Hike, Derailing the Off-Grid Movement
While Nevadans were celebrating the holidays under solar-powered lights, the Nevada Public Utilities Commission (PUC) voted unanimously to increase a monthly fee on solar customers by 40% while reducing the amount they get paid for excess power sold to the grid. Adding insult to injury, they made the rate changes retroactive, sabotaging consumer investments in solar energy. This single move by government regulators will effectively kill the solar industry in Nevada and put an end to the surge of people seeking to detach from the grid by harnessing their own energy from the sun. Just as importantly, it serves to protect the profits of Nevada’s public utility company, NV Energy.
- Gerald Celente – One Of The Wildest 6 Weeks Of Trading In History, But Here’s The Big Surprise
On the heels of an absolutely wild trading week for global markets, today the top trends forecaster in the world spoke with King World News about one of the wildest six weeks of trading in history. Eric King: “Gerald, they put a few hundred points to the upside in the Dow. So they may rally this market out of the hole. It hit the wire today that Jamie Dimon bought a bunch of JP Morgan stock. Your thoughts on the possibility of a rally, maybe a short squeeze on the public’s (near-record) short positions to get them out before the next tumble to the downside. Do you see that as a possibility?” Gerald Celente: “Of course it’s possible. Absolutely. The game is rigged. Go back to the Davos Meeting in mid-January. I read it on King World News, when you had Art Cashin on and he quoted Ray Dalio from Bridgewater Associates saying that we needed more quantitative easing from the Fed…
- Venezuela Declares Another Emergency: It Has Run Out of Food
Venezuela’s opposition legislature has declared a “nutritional emergency,” proclaiming that the country simply does not have enough food to feed its population. The move comes after years of socialist rationing and shortages that forced millions to wait on lines lasting as long as six hours for a pint of milk, a bag of flour, or carton of cooking oil.
- Deutsche Bank Burns – Silver Is The Trade Of The Decade
Deutsche Bank management spent Tuesday and Wednesday trying to make the case that it had plenty of liquidity and a gameplan to address structural issues. They threw the hail Mary yesterday when they announced the possibility of using available “liquidity” to repurchase a few billion euros worth of senior bonds. I have quotes around “liquidity” because, as I outlined in my blog post about this yesterday, DB is technically insolvent.
- The government just admitted it will use smart home devices for spying
If you want evidence that US intelligence agencies aren’t losing surveillance abilities because of the rising use of encryption by tech companies, look no further than the testimony on Tuesday by the director of national intelligence, James Clapper.
- JPM's Kolanovic Warns Upcoming Recession Could Be Comparable To 2008 Crisis; Says “Buy Gold, Cash And VIX”
By now all of our readers should be familiar with JPM's head quant Marko Kolanovic whose unblemished track record of accurate market calls is not only second to none, but is the equivalent in absolute value terms of Dennis Gartman's consistently wrong calls, which is why we won't spend time introducing him.
- The sinking EU ship: Shock as Italian PM says: ‘EU is like the orchestra on the Titanic'
ITALY’S prime minister Matteo Renzi has stunned Brussels by comparing crisis-hit EU bosses as “like the orchestra playing on the Titanic”. The spirited leader continued his attacks on Brussels chiefs yesterday over their failure to deal with the multiple crises afflicting the 28-member bloc. The EU is currently beset by emergencies such as the global migrant crisis, eurozone debt timebomb, high levels of youth unemployment, the threat of terrorism and Britain’s EU referendum.
- Genius: FATCA has brought in just $13.5 billion in revenue on a cost of $1 trillion
Earlier this week the State Department released its latest statistics for people who have renounced their US citizenship. 2015 was another record year, with 4,279 people divorcing themselves from the US government and heading to greener pastures elsewhere.
- Gold price: why major brokers are still predicting a fall to $1,000
Winner of the London Bullion Market Association's 2015 price-prediction competition forecasts an average of $970 this year. It may be the best-performing asset in what has been a tumultuous start to 2016 but gold is still vulnerable to improvements in rates and the dollar and will fall to $1,000 an ounce or below this year, according to two analysts.
- Gerald Celente Warns The Global Crash Of 2016 Will Be Twice As Devastating As The 2008 Collapse
With gold spiking nearly $70 at one point during today’s trading, today the top trends forecaster in the world warned King World News that the global crash of 2016 will be twice as devastating as the 2008 collapse. Eric King: “Gerald, Stephen Leeb told King World News today that “The world is scared to death of deflation.”
- World Now On The Edge Of Total Panic As Gold Spikes $60 And Global Stock Markets Plunge
With gold spiking more than $60, the dollar falling and bonds surging, today one of the top money managers in the world warned King World News that the world is now in the early stages of total panic as global stock markets plunge. King World News warned its global readers yesterday that global panic was coming because of the derivative nightmare in Hong Kong. Well, it’s here…
- After 1,428 years here’s what brought down the world’s oldest business
In 578 AD, a Korean immigrant named Shigemitsu Kongo made his way to Japan at the invitation of the royal family. Buddhism was on the rise in Japan at the time; though it had only been introduced a few decades prior, the Empress consort had been actively encouraging the adoption of Buddhism across Japan. But since the Japanese had no experience building Buddhist temples, they looked overseas for help. That’s where Kongo came in.
- 5 worst investment calls of this century
The 21st century is well into its second decade, but it’s already had two stock market crashes, a global financial crisis and the Great Recession, from which we haven’t fully recovered. Not surprisingly, financial pundits and gurus have gotten many things wrong. But some have gotten them really wrong. Here are my picks for the five worst investing calls so far, based on how off base they were and how big their consequences were.
- Some Hedge Funds Want to Make Subprime Auto Loans Next Big Short
A group of hedge funds, convinced they have found the next Big Short, are looking to bet against bonds backed by subprime auto loans. Good luck finding a bank willing to do the trade.
- The US Is Already in a Recession; Get Ready for Some Crazy Monetary Policy
Jim Grant appeared on CNBC’s Closing Bell and unhesitatingly said he thinks the US economy has already gone into recession: “I think we are in one…I think there’s a defensible case to be made that a recession began late last year.”
From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. A lot of news about the current global collapse. We are still looking at derivatives and that could come from China as predicted. Keep an eye on the news daily. For the past month I have been putting up many stories every day at the Lindsey Williams Online Facebook Page that are important to understand what is happening and how you can protect yourself.
We have now seen gold jump to close to $1,250. It broke $1,200 yesterday and jumped an additional $50 today. For those who didn't prepare when you were warned, unfortunately the life rafts are running out. Gold supplies are running low. Lead times are well over 30 days and now will be considerably more because demand for physical metal is up.
Latest News From February 5, 2016 to February 11, 2016:
- Gold demand bounces back as fear grips markets
Fears that the world is on the brink of another financial crisis pushed gold prices above $1,200 on Thursday as nervous investors snapped up the precious metal. Gold prices jumped to their highest in a year, gaining as much as 3.6pc to $1,234.64 an ounce. It came as the World Gold Council said jitters about the global economy sparked a gold buying spree among nervous investors at the start of the year.
- FTSE 100 hits lowest level since 2012 amid worsening fears of recession
The FTSE 100 has hit its lowest point in three and a half years, down 130 points on opening. European stocks are all the slide again after a difficult day's trading in Asia, which saw Hong Kong rapidly catch up with the global sell-off after the Lunar New Year holiday. The FTSE 100 was down 2.3 per cent, the German DAX was down 3 per cent and France's CAC 40 was down 3.4 per cent.
- “Fasten Your Seatbelts”: Kyle Bass Previews The Collapse Of China's $34 Trillion Banking Sector
Earlier this month, Kyle Bass asked a funny question in a discussion with CNBC’s David Faber. To wit: “If some fund manager in Texas is saying that your currency is dramatically overvalued, you shouldn’t care on a $10 trillion economy with $34 trillion in your banks. I have, call it a billion – it’s so small it should be irrelevant and yet somehow it’s really relevant.”
- Gold Will Smell Blood of Negative Rates-Peter Schiff
Money manager Peter Schiff says forget about the Fed raising interest rates. The next move is down. Schiff explains, “I think there is a pretty good chance we’re going to get 0% interest rates before the end of the year, and I think we’re going to get QE4. We will see if the Fed is going to go negative, but they are going to do it eventually.”
- “It May Take Less Than 48 Hours to Take it ALL Down” – Bill Holter
Whether you want to see it or not, the financial system is in a forced unwinding. It took some 70 years to build this great credit edifice. When it goes it may take less than 48 hours to take it ALL down.
- ALERT: Derivatives Nightmare Has Shares In Hong Kong Plunging And Gold Surging To $1,250
With gold moving well above $1,250, many market participants are trying to understand: Why gold is surging and why there is so much turmoil in overseas trading in Asia?
- This Is How Frightening The Global Collapse Has Now Become
On the heels of the Nikkei plunging a jaw-dropping 11 percent in just 3 days, and the world banking system entering another round of panic, this is how frightening the global collapse has now become.
- No easy way out for Deutsche Bank as investors ‘lose faith'
Deutsche Bank bosses face a formidable task to drag its shares off a 30-year low, with reassurances about its capital levels doing little to improve investor confidence and few other options on the table to trigger a recovery. Germany's flagship lender has trailed its rivals in bouncing back from the 2008 financial crisis, hamstrung by having to pay out billions of dollars in fines to end a string of legal disputes and ageing technical infrastructure.
- Legendary Investor Jim Rogers Warns: “Most People Are Going To Suffer The Next Time Around”
Rogers says that investors around the world are realizing that the jig is up. Stocks are over bloated and central banks will have little choice but to take action again. But this time, says Rogers in his latest interview with CrushTheStreet.com, there will be no stopping it and people all over the world are going to feel the pain, including in China and the United States.
- Netflix, Inc., Yahoo! Inc., LinkedIn Corp, Twitter Inc: Dot-Com Bubble 2.0 Is Bursting
Do you remember how much stocks went down when the first dot-com bubble burst? Well, it is happening again, and tech stocks are already down more than half a trillion dollars since the middle of 2015. On Friday, the tech-heavy Nasdaq dropped to its lowest level in more than 15 months, and it has now fallen more than 16 percent from the peak of the market. But of course some of the biggest names have fallen much more than that.
- 2007 All Over Again, Part 3: Banks Starting To Implode
So far, each financial crisis in the series that began with the junk bond bubble of 1989 has been noticeably different from its predecessors. New instruments, new malefactors, new monetary policy experiments in response. But the one that’s now emerging feels strikingly similar to what just happened a few years ago: Banks overexposed to assets they thought were safe but turn out to be highly risky see their balance sheets deteriorate, their liquidity dry up and their stocks plunge.
- Janet Yellen Sounds a More Cautious Note on the U.S. Economy
The Republicans described the Federal Reserve as ineffective, secretive and out of touch with the economic realities of ordinary Americans. The Democrats showered it with praise, using words like “herculean.” And those were just the opening statements on Wednesday, as the Fed’s chairwoman, Janet L. Yellen, began two days of testimony on Capitol Hill. Ms. Yellen functions as the nation’s economic weather forecaster and, on Wednesday, she sounded more worried than at her last public appearance, in December.
- Gold price surges above $1,200 after latest markets rout
The gold price continues on its strong incremental advance, setting lower lows on a path to higher highs that overnight saw it decisively breach a key resistance level at $1,200. On Wednesday, gold's spot price dipped back slightly in both the European and New York trading sessions, the Wall Street Journal notes, amid a brief relief rally in Europe and some profit-taking from the ongoing “safe haven” shift. But as the equities rout recommenced in Asia overnight, it resumed its upward trend.
- UPDATE: IBEX 35, Spain's Leading Stock Index, Closes Below 8,000 For First Time Since July 2013
Spain's leading stock index, the IBEX 35, gave up what remained of the gains posted during the last 933 days on Tuesday, closing below 8,000 points for the first time since July 22, 2013, at 7,927.60, a fall of 194.5 points or 2.39% compared to yesterday. The indicator dropped as low as 7,862 points during the session. The index has lost 32.36% since reaching a post-2012 high of 11866.40 on April 13 last year, 23% since November 30 last year, just prior to the start of the general election campaign, and 17% since the first trading session of the year on January 4.
- Yield on 10-year Japan government bond falls below zero for first time
Yields on Japan's benchmark 10-year government bond fell below zero for the first time, as investors clamored for safe-haven assets in the wake of a global market rout. The yield on the 10-year Japan government bond (JGB) dropped as low as negative 0.007 percent. The fall came on the heels of a global stock market sell-off overnight that likely spurred safe haven flows back into Japan. Bond prices move inversely to yields.
- DOW 6,000 Extreme Sell-Off Coming-Gregory Mannarino
Trader/analyst Gregory Mannarino called the top of the DOW in May 2015. The market was well over 18,000 then and currently more than 2,000 points lower. Mannarino now says the Dow is going to “6,000–or lower.” Mannarino warns, “People need to be ready for a major, extreme sell-off in equities which are inflated in a bubble.”
- Obama proposes $10 a barrel oil tax
President Obama has released the final budget proposal of his presidency, a $4.1tn (£2.8tn) programme that includes a $10.25 per barrel tax on oil. The Republican-controlled Congress is expected to reject it. The leaders of the House and Senate budget committees jointly announced they would not invite Mr Obama's budget director to testify before them. Despite the setbacks, the White House has said the budget sticks to a bipartisan agenda reached last autumn.
- UK goods trade gap biggest on record
The UK's goods trade gap with the rest of the world widened by £1.9bn to a record high of £125bn in 2015, official figures show. The Office for National Statistics also warned the latest figures would have a negative impact on its second estimate of fourth-quarter economic growth. But 2015 also saw a record surplus in the UK's dominant services sector of £90bn. That meant the UK's total trade gap widened by just £300m last year.
- Brent Oil Falls Most in 5 Months on Glut as Volatility Surges
Crude tumbled the most in five months in London as price volatility climbed to a seven-year high and Goldman Sachs Group Inc. warned of wider swings to come. Brent futures fell 7.8 percent as global equities neared a bear market. Volatility is set to “spike” as prices seek an equilibrium, which could drag oil below $20 a barrel, Goldman Sachs said. The CBOE Crude Oil Volatility Index, which measures expectations of price swings, rose as high as 73.52, almost the highest since 2009. The world oil surplus will be bigger in the first half of this year than previously estimated, according to the International Energy Agency.
- Goldman Sachs Abandons Five of Six ‘Top Trade' Calls for 2016
Goldman Sachs to clients: whoops. Just six weeks into 2016, the New York-based bank has abandoned five of six recommended top trades for the year. The dollar versus a basket of euro and yen; yields on Italian bonds versus their German counterparts; U.S. inflation expectations: Goldman Sachs Group Inc. was wrong on all that and more.
- S&P Downgrades Junk-Level Ratings on 25 Oil-and-Gas Producers
Standard & Poor’s Ratings Services downgraded the junk-territory ratings on 25 oil-and-gas companies on expectations that credit quality will deteriorate owing to low commodities prices and reduced production. The credit-ratings firm, which also affirmed the ratings of an additional 20 speculative-grade exploration-and-production companies, said the ratings actions followed a revision of S&P’s price assumptions for crude and natural-gas.
- Gold futures stretch streak of gains to a 5th-straight session
Gold futures staged a late-session turnaround on Tuesday, as a move lower for oil prices and sharp losses in U.S. equities gave the metal enough momentum to stretch its streak of gains to a fifth-straight session. April gold GCJ6, -0.27% rose 70 cents, or less than 0.1%, to settle at $1,198.60 an ounce, tallying a total gain of more than 6% in five sessions. The settlement price was the highest for a most-active contract since June 19, 2015, FactSet data show.
- Opinion: Will oil be so cheap that it won’t pay to pump it out of the ground?
The conventional wisdom regarding the recent plunge in the price of oil CLH6 is that we are seeing a repeat of the 1985-1986 collapse, when Saudi Arabia ramped up production as part of a dispute with other members of the Organization of Petroleum Exporting Countries cartel. This time, the thinking goes, Saudi Arabia is doing the same in response to its loss of market share to shale-oil production in the United States.
- Deutsche Bank Is Scared: “What Needs To Be Done” In Its Own Words
It all started in mid/late 2014, when the first whispers of a Fed rate hike emerged, which in turn led to relentless increase in the value of the US dollar and the plunge in the price of oil and all commodities, unleashing the worst commodity bear market in history. The immediate implication of these two concurrent events was missed by most, although we wrote about it and previewed the implications in November of that year in “How The Petrodollar Quietly Died, And Nobody Noticed.”
- The Coal Decline Is Now Irreversible
There was a lot of talk last year about coal resources needing to be left in the ground if the world was to reach its 2-degree-celsius reduction environmental targets. The suggestion was that legislation was required to force power generators to switch to less polluting energy sources and, while in the meantime tougher emissions standards have played their part, the market has been much more active than government in encouraging change.
- India surpasses China to become fastest growing economy in the world
India's economy grew faster than China in 2015, official Gross Domestic Product (GDP) data released by both countries has revealed. The Indian government reported that the country grew at an average of 7.5% in 2015, which is more than the 6.9% GDP that Beijing reported during the same period, making India the world's fastest growing major economy.
- Privatization Is the Atlanticist Strategy to Attack Russia — Paul Craig Roberts and Michael Hudson
Two years ago, Russian officials discussed plans to privatize a group of national enterprises headed by the oil producer Rosneft, the VTB Bank, Aeroflot, and Russian Railways. The stated objective was to streamline management of these companies, and also to induce oligarchs to begin bringing their two decades of capital flight back to invest in the Russia economy. Foreign participation was sought in cases where Western technology transfer and management techniques would be likely to help the economy.
- NYSE joining Nasdaq in eliminating stop orders
A type of order traders use to protect against losses is being phased out, as stock exchanges seek to deal with the ramifications of huge intraday swings. The New York Stock Exchange, in a statement, said it would no longer accept what are called stop orders, beginning Feb. 26, joining the Nasdaq NDAQ in barring them. Another order type called good-till-canceled also is being axed.
- Going Negative: Analysts See Increasing Likelihood of Sub-Zero US Interest Rates
Mainstream analysts have started seriously talking about the possibility of negative US interest rates in the near future. On the heels of the Bank of Japan dropping a key interest rate to negative 0.1% late last month and indicating it is willing to go deeper into negative territory, Bloomberg reports that American analysts see an increasing likelihood that the Federal Reserve is willing to follow suit.
- Markets: Flight To Safety As Nikkei Falls 5.4%
The global stock market rout has intensified, with Japan's Nikkei losing 5.4% of its value in a horror show of a trading day that saw a rush for safe havens such as gold and the yen. The sell-off followed Monday's lead on the European and US stock markets when they endured further losses on top of those already witnessed since the start of the year with jitters about the global economy taking a strangle hold on investments.
- JPMorgan forecasts ECB to cut deposit rate as low as -0.7 percent this year
U.S. bank JPMorgan on Tuesday forecast the European Central Bank to aggressively ease monetary policy again by cutting its already negative deposit rate by another 40 basis points to minus 0.7 percent this year. The bank said it also expects the ECB to extend its quantitative easing, or bond-buying programme, through the end of 2017. It said it expected the easing to start next month with a deposit rate cut to -0.5 percent from the current -0.3 percent – followed by a second package perhaps as early as June which will see another 20 basis points lopped off and an extension of QE.
- Setting The Record Straight On The Massive Gold Supply Conspiracy
As market turmoil continues to push gold and silver prices higher, precious metal investors need to understand the fundamentals more than ever. Unfortunately, there continues to be a lot of misinformation reported by sources in the precious metal community. This is harmful as it confuses would be precious metal investors.
- Jaw-Dropping Indicator Last Seen During Great Depression Just Hit An All-Time High!
On the heels of the Dow plunging nearly 400 points at one point during today’s trading session, and with gold surging and oil falling, today a jaw-dropping indicator that was last seen during the Great Depression just hit an all-time high!
- Japanese banks plunge on European financial stocks rout
Japanese and Australian banks picked up the baton from their European peers, pulling the two bourses — the only two major Asian markets trading on Tuesday morning — sharply lower. Nomura led Japan’s meltdown, dropping 8 per cent within 20 minutes of the market opening. Big commercial banks Sumitomo Mitsui and Mitsubishi UFJ Financial were off 7 and 6.7 per cent respectively. Australian banks also fell sharply.
- British steel sector ‘at risk of impending collapse'
Business Secretary joins in Europe-wide plea to EC for anti-dumping action. The steel industry in Britain and Europe faces a “significant and impending risk of collapse”, business ministers have warned in a letter to European Commissioners demanding action to save steel makers.
- Citi: World economy trapped in ‘death spiral'
The global economy is trapped in a “death spiral” that could lead to further weakness in oil prices, recession and a serious equity bear market, Citi (C) strategists have warned. Some analysts — including those at Citi — have turned bearish on the world economy this year, following an equity rout in January and weaker economic data out of China and the U.S. “The world appears to be trapped in a circular reference death spiral,” Citi strategists led by Jonathan Stubbs said in a report on Thursday.
- Global Growth Fears Hit Bank Stocks
Investors are dumping bank stocks amid worries that a protracted period of slowing global growth, plunging oil prices and rock-bottom interest rates will combine to inflict pain on the world’s largest financial institutions.
- Confusion and turmoil helps gold to shine
Concerns over the global economy have added an extra shine to safe-haven assets such as gold, according to the chief executive of a top mining firm, who told CNBC that “solid” demand and future economic stress could lead to more price gains for the commodity.
- Exclusive: Iran wants euro payment for new and outstanding oil sales – source
Iran wants to recover tens of billions of dollars it is owed by India and other buyers of its oil in euros and is billing new crude sales in euros, too, looking to reduce its dependence on the U.S. dollar following last month's sanctions relief. A source at state-owned National Iranian Oil Co (NIOC) told Reuters that Iran will charge in euros for its recently signed oil contracts with firms including French oil and gas major Total, Spanish refiner Cepsa and Litasco, the trading arm of Russia's Lukoil.
- George Osborne may have just triggered a Financial Crisis ‘greater than 2007’
A recent report issued to the Bank of England has revealed that the actions of George Osborne may be about to trigger a financial crisis greater than 2007, and once again, it will start in the housing market.
- EU on brink of ‘terrifying crisis' Five of Europe's big banks are in danger, warns expert
SOME of Europe's biggest banks are on the brink for a crisis that echoes the 2008 meltdown, a finance expert warned, as fears over the global economy escalate. Deutsche Bank, Credit Suisse, Santander, Barclays and RBS are among the stocks that are falling sharply sending shockwaves through the financial world, according to former hedge fund manager and ex Goldman Sachs employee Raoul Pal.
- Everybody Hopping on Gold Bandwagon, but Signs There All Along
The mainstream world of economics and investment has the attention span of a 12-year-old hopped up on sugar. A couple of months ago, it was all doom and gloom for gold. The Fed was talking interest rate hikes, government spokespersons were claiming victory over the recession, and mainstream analysts were hastily pounding nails in gold’s coffin. Cancel the wake, because today everybody has turned bullish on gold with the price up more than 9% since New Year’s Day.
- Russia is now China's biggest oil partner — and it's a huge problem for Saudi Arabia
Saudi Arabia has long trumped Russia in the Chinese oil market. The Saudi share of Chinese crude imports at the beginning of the decade was about 20%, while Russia's was below 7%, according to data cited by RBC Capital Markets. But now the Russians are creeping in — and the Saudis are getting nervous.
- U.S. rig count drops 8 percent
The total number of rigs actively exploring for or producing oil and gas in the United States dropped more than 8 percent, Baker Hughes reports.
- Fascinating graphics show who owns all the major brands in the world
All the biggest product brands in the world are owned by a handful of corporation. Food, cleaning products, banks, airlines, cars, media companies… everything is in the hands of these megacorporations. These graphics show how everything is connected.
- Who Owns The Big TV Networks
- How 37 Banks Became 4 In Just 2 Decades, All In One Astonishing Chart.
- Strange Occurrence Off The Coast Of Texas Raises Concerns
Something bizarre is happening off the coast of Galveston, Texas. Were you to look toward the sea in the Texas port town, you’d be subject to a oceanic traffic jam of epic proportions. Ships carrying oil have gathered along the coast in the Gulf of Mexico in such great quantities that ships approaching the port have been asked to move toward the town slowly in an attempt to ease the burden.
- Is This How The Smart Money Is Betting On A Market Crash?
Instead of allocating capital to expensive tail risk bets on direct asset class collapse (in equities, credit, and commodities), it appears, just as we detailed previously, the ‘smartest money in the room' is “betting” indirectly on a stock market crash through eurodollar options. As we previously detailed, the costs of tail risk protection in credit and equity markets are soaring (and perhaps the crash in global financial stocks and spike in systemic credit risk supports that concerning possibility).
- Chorus Of Financial Experts Warn Of Imminent Crisis
A growing list of financial gurus and industry experts are warning that 2016 could see a devastating collapse in global financial markets, pushing America into an economic downturn potentially worse than the 2008 recession.
- Tehran wants to dump dollar in crude trade – report
ran wants post-sanctions’ oil contracts denominated in dollars and have buyers pay in euros, Reuters reported. Tehran is also keen to receive money owed to it since the pre-sanctions days in the European currency.
- TPP Deal Just Signed: Paves Way for Authoritarian Technocracy
Beware TPP. It's nothing more than the further formalization of the worst part of the 20th century: The warfare/welfare state. It's just been signed in New Zealand by the 12 negotiating parties and now US President Barack Obama is pressuring Congress to get it passed quickly. Obama wants it passed so that the US will be able to “write the rules of the road in the 21st century,” enabling it to shape global trade to its own advantage.
- 22 Signs That The Global Economic Turmoil We Have Seen So Far In 2016 Is Just The Beginning
As bad as the month of January was for the global economy, the truth is that the rest of 2016 promises to be much worse. Layoffs are increasing at a pace that we haven’t seen since the last recession, major retailers are shutting down hundreds of locations, corporate profit margins are plunging, global trade is slowing down dramatically, and several major European banks are in the process of completely imploding.
- US trade deficit widens as exports fall
The U.S. trade deficit widened in December as a strong dollar and weak global demand continued to weigh on exports. The Commerce Department said on Friday the trade gap rose 2.7 percent to $43.4 billion. November's trade deficit was revised down to $42.2 billion from the previously reported $42.4 billion.
- Dollar tumbles as Fed rescues China in the nick of time
The central banks of Europe and Japan discover that it is impossible to stave off deflation by debasing their currencies when everybody is playing the same game. The US dollar has suffered one of the sharpest drops in 20 years as the Federal Reserve signals a retreat from monetary tightening, igniting a powerful rally for commodities and easing a ferocious squeeze on dollar debtors in China and emerging markets.
- Congress wants to turn the US Postal Service… into a bank
It’s news that seems ripped from the pages of The Onion. Or perhaps Atlas Shrugged. But incredibly enough it’s actually true: earlier this week, Congress proposed a new law authorizing the US Postal Service to provide banking and financial services. It’s called the “Providing Opportunities for Savings, Transactions, and Lending” Act, abbreviated as… wait for it… the POSTAL Act.
- Why it would be wise to prepare for the next recession
What might central banks do if the next recession hit while interest rates were still far below pre-2008 levels? As a paper from the London-based Resolution Foundation argues, this is highly likely. Central banks need to be prepared for this eventuality. The most important part of such preparation is to convince the public that they know what to do.
- Mass Layoffs To Return With A Vengeance
Remember the mass layoffs of 2008-2009? The US economy shed millions of jobs quickly and relentlessly, as companies died and the rest fought for survival. Then the Fed and the US government flooded the banks and the corporate sector with bailouts and handouts. With those giga-tons of liquidity sloshing around, as well as taking on massive amounts of new cheap debt, companies were able to finance their working capital needs, hire workers back, and even buy-back their shares en mass to make themselves look deceptively profitable. The nightmare of 2008 soon became a golden era of ‘recovery'. Well, 2016 is showing us that that era is over. And as stock prices cease to rise, and in fact fall within many industries, layoffs are beginning to make a return as companies jettison costs in attempt to reduce losses.
- 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.
From James Harkin (Webmaster & Editor of LindseyWilliams.net). Here is a summary of articles of interest from around the world for this week. One point I'd like to mention is that gold has started to rally. I will be doing a special article on gold next week that will share some insight into what is happening and what you could see if this trend continues. Please continue to send me news articles and I will include them in the summary each week. Also, the latest articles and news are added daily at the Lindsey Williams Online Facebook Page. Please ‘LIKE' the page and share it with others. I have included a widget on the right hand side of this page also. I am also creating a Lindsey Williams Online YouTube page that will include regular videos and content.
Latest News From January 29, 2016 to February 4, 2016:
- Gold sets new three-month high as investors shun risky assets
Gold hit three-month highs on Wednesday as the dollar slid versus the euro and European shares fell sharply, prompting investors to seek shelter in assets perceived as safer. Data showing the U.S. economy's services sector expanded in January at a slower pace than expected overshadowed stronger-than-expected U.S. ADP private payrolls data, helping knock the dollar to a 14-week low against the euro. Spot gold was up 0.9 percent at $1,138.46 at 1618 GMT, having earlier touched its strongest since Nov. 2 at $1,139.90.
- Dollar Posts Biggest 2-Day Drop Since March as 2016 Rally Erased
The dollar posted its biggest two-day drop since March, extending a decline that wiped out its rally at the start of the year. The greenback fell against all of its 16 major peers except the pound, which was weighed down by the Bank of England ’s unanimous vote to keep interest rates unchanged. Signs of a slowing U.S economy have hurt the dollar by derailing wagers on diverging policies between central banks. Currency traders are catching up to the bond market, where 10-year yields sank to the lowest in a year on Wednesday and futures sent the strongest signal yet that traders expect the Federal Reserve to stand pat on rates in 2016.
- Job cuts surged 218% in January
Layoff announcements surged 218% from December to January, led by the retail and energy sectors. The latest monthly report from the staffing firm Challenger, Gray and Christmas on planned job showed that US employers in January reported 75,114 planned job cuts, up 42% year-on-year. Retailers moved the needle on this data point the most, particularly Walmart, which announced plans to close 269 stores across America.
- US productivity falls sharply in fourth quarter
U.S. nonfarm productivity fell in the fourth quarter at its fastest pace in more than a year, leading to a jump in labor-related production costs. The Labor Department said on Thursday that productivity, which measures hourly output per worker, declined at a 3.0 percent annual rate, the biggest drop since the first quarter of 2014. Productivity rose by a downwardly revised 2.1 percent rate in the third quarter. Economists polled by Reuters had forecast productivity falling at only a 1.8 percent rate last quarter after expanding at a previously reported 2.2 percent pace in the third quarter.
- Germany Unveils “Cash Controls” Push: Ban Transactions Over €5,000, €500 Euro Note
It was just two days ago that Bloomberg implored officials to “bring on a cashless future” in an Op-Ed that calls notes and coins “dirty, dangerous, unwieldy, and expensive.” You probably never thought of your cash that way, but increasingly, authorities and the powers that be seem determined to lay the groundwork for the abolition of what Bloomberg calls “antiquated” physical money. We’ve documented the cash ban calls on a number of occasions including, most recently, those that emanated from DNB, Norway’s largest bank where executive Trond Bentestuen said that although “there is approximately 50 billion kroner in circulation, the Norges Bank can only account for 40 percent of its use.”
- Hyper Inflation Is Here
Last week I wrote an article for King World News which showed that hyperinflation is on its way in many emerging markets. Soon it will also reach the US, Europe, Japan, China and many other countries. Hyperinflation has nothing to do with demand but is the effect of economic mismanagement leading to money printing and currency collapse. This trend started over 100 years ago with the creation of the Fed. Since then all major currencies have declined 97-99% in real terms. The best way to measure inflation over time is in gold. For 5,000 years, gold is the only currency that has survived. All other currencies have been printed to death. The trend of currency debasement is now accelerating in the periphery. For example, in Russian Rubles and Brazilian Real gold is up 1,300% in 16 years and in Argentine Pesos gold is up 6,000% since 1999. Also, gold now buys more oil than it has ever done in history.
- Comex: Paper Gold “Dilution” Hits A Record 542 For Every Ounce Of Physical
There had been an eerie silence at the COMEX in recent weeks, where after registered gold tumbled to a record 120K ounces in early December nothing much had changed, an in fact the total amount of physical deliverable aka “registered” gold, had stayed practically unchanged at 275K ounces all throughout January. Until today, when in the latest update from the COMEX vault, we learn that a whopping 201,345 ounces of Registered gold had been de-warranted at the owner's request, and shifted into the Eligible category, reducing the total mount of COMEX Registered gold by 73%, from 275K to just 74K overnight.
- Another Nail In The US Empire Coffin: Collapse Of Shale Gas Production Has Begun
The U.S. Empire is in serious trouble as the collapse of its domestic shale gas production has begun. This is just another nail in a series of nails that have been driven into the U.S. Empire coffin. Unfortunately, most investors don’t pay attention to what is taking place in the U.S. Energy Industry. Without energy, the U.S. economy would grind to a halt. All the trillions of Dollars in financial assets mean nothing without oil, natural gas or coal. Energy drives the economy and finance steers it. As I stated several times before, the financial industry is driving us over the cliff. The Great U.S. Shale Gas Boom Is Likely Over For Good.
- Here's Which Stocks Sovereign Wealth Funds Will Be Selling In 2016
Back in August we explained why the headline figures for EM FX reserves paint an incomplete picture with regard to the UST liquidation among commodity producers and emerging market reserve managers. As Credit Suisse wrote last year, “for oil exporting nations, central bank official reserves likely underestimate the full scale of the reversal of oil exporters’ ‘petrodollar’ accumulation because a substantial part of their oil proceeds has previously been placed in sovereign wealth funds (SWFs), which are not reported as FX reserves (with the notable exception of Russia.” In other words, official data on FX reserves don’t tell the whole story. Not by a long shot. In fact, “oil exporting countries hold about $1.7trn of official reserves but as much as $4.3trn in SWF assets.”
- The Unleashing Of QQE And Global Economic Meltdown
The Keynesian elite gathered in Davos Switzerland this past week to pontificate on global economic issues and to strategize the engineering of The Fourth Industrial Revolution. This new so called “revolution” includes a discussion on the future of Artificial Intelligence. Judging by the comments coming from most of the list of attendees, it seems obvious the intelligence on display was indeed faux. But the most important takeaway from this venue was that central bankers have made it clear to the markets that the level and duration of quantitative counterfeiting know no bounds…
- It Has Begun!
Since August 18th, we have stated that the markets had shifted, major indexes would begin to decline, and a NEW gold bull market was imminent! And now, one of the best-leading indicators is pointing to a roaring bull market for gold. The two most heavily traded gold stocks, Barrick Gold and Newmont Mining, are having one hell of a move since last summer. The Bull Market has Already Begun!
- ALERT: Nomi Prins Issues Dire Warning – We May Have Just Witnessed The Trigger For The Next Global Collapse
Today Nomi Prins, the keynote speaker who recently addressed the Federal Reserve, IMF and World Bank, issued a dire warning to King World News that we may have just witnessed the trigger for the next global collapse. Eric King: “We saw the global financial system come unhinged as a result of the mortgage-backed securities scheme from 2007 – 2009. Do all the derivatives and junk bonds tied to the energy sector have the potential to cause a similar level of panic and chaos in the global banking and financial system?” Nomi Prins: “It does have that potential for a similar reason, which is that a very small amount of underlying collateral in the energy sector and other industries that are dependent on profits from the energy sector for their own revenues, a small number of those can create a much larger ripple effect…
- The Fed Wants to Test How Banks Would Handle Negative Rates
As interest rates turn negative around the world, the Federal Reserve is asking banks to consider the possibility of the same happening in the U.S. In its annual stress test for 2016, the Fed said it will assess the resilience of big banks to a number of possible situations, including one where the rate on the three-month U.S. Treasury bill stays below zero for a prolonged period. “The severely adverse scenario is characterized by a severe global recession, accompanied by a period of heightened corporate financial stress and negative yields for short-term U.S. Treasury securities,” the central bank said in announcing the stress tests last week.
- Europe Continued Gold Repatriation at Faster Rate in 2015
Germany ramped up its gold repatriation project last year, joining other European nations bringing gold home. The trend underscores the importance of holding physical gold within easy access. Germany’s Bundesbank transferred more than 210 tons of gold back into the country from vaults in Paris and New York last year. According to the Financial Times, with last year’s transfers, Frankfurt now ranks as the largest storage location for the country’s reserves after New York.
- New “Tech Tattoos” Will Be Tied To Medical And Banking Information
Apparently a tech company called Chaotic Moon is looking to take advantage of the 20% of humans who already have a proclivity toward tattoos. For the rest? An appeal to safety and security, of course, and an assurance that a future offering could be a “Band-Aid-like package.” Chaotic Moon’s dual-purpose tattoo is comprised of electro conductive ink embedded with sensors and microchips. Here is the reasoning why this product is so desirable according to one of the developers, Eric Schneider, who mentions the banking aspect to CBSNewYork.
- Ford To Cut Hundreds Of Jobs In UK And Germany
Car maker Ford is to shed hundreds of jobs in the UK and Germany as part of a programme to save $200m (£138m) a year. The group said it was launching a voluntary redundancy programme as it looked to slash costs across its European business, in the face of mounting regulatory costs. It comes after Ford recently revealed that its European operation had returned to profit for the first time in four years in 2015. Production and product development workers will not be affected by the job cuts. The company said they were mainly likely to go in administration and marketing.
- ISM New York Tumbles Most Since August As Revenues Crash
While Chicago's business outlook managed a miraculous bounce in January, New York did not. ISM New York printed 54.6, plunging most since August from December's 62.0 level. The extremely noisy time series continues to swing, this time lower, as the underlying components deteriorate with Revenues collapsing to at least 3 year lows.
- Biggest part of economy growing at slowest pace in two years, ISM finds
Companies in the U.S. service sector such as retail, banking and health care grew in January at the slowest pace in almost two years, adding to a drumbeat of data suggesting the economy has softened. The Institute for Supply Management said its nonmanufacturing index fell to 53.5% from 55.8% in December. Economists polled by MarketWatch had forecast a 55.2% reading. Any number over 50% indicates more businesses are expanding instead of contracting, but the ISM service index has dropped three straight months and is at the lowest level since February 2014.
- Lloyds Banking Group to cut 1,755 jobs and close 29 branches
Lloyds Banking Group is cutting 1,755 jobs and closing 29 branches as part of a plan by its chief executive, António Horta-Osório, to cut costs as he prepares the bank for privatisation. Staff were told about the job losses, which cover large parts of the group, on Wednesday, but union officials said they hoped that the reductions could be achieved by voluntary means. Horta-Osório is continuing with the cost-reduction programme even though the chancellor, George Osborne, has admitted that he cannot press on with a sale of the government’s remaining Lloyds shares to the public because of the market turmoil, which has knocked the bank’s share price.
- BOJ Kuroda says can ease more, devise new tools
Bank of Japan Governor Haruhiko Kuroda said the central bank has ample room to expand stimulus further and is prepared to cut interest rates deeper into negative territory, signalling a readiness to act again to hit his ambitious inflation target. “If we judge that existing measures in the toolkit are not enough to achieve (our) goal, what we have to do is to devise new tools,” Kuroda said in a speech at a seminar on Wednesday (Feb 3). “I am convinced that there is no limit to measures for monetary easing,” he said. Governor Kuroda also countered criticism that the BOJ was running out of ammunition to accelerate inflation, which has ground to a halt due to slumping oil costs, saying negative rates won't hamper the bank's efforts to gobble up government bonds.
- Venezuela is on the brink of a complete economic collapse
The only question now is whether Venezuela's government or economy will completely collapse first. The key word there is “completely.” Both are well into their death throes. Indeed, Venezuela's ruling party just lost congressional elections that gave the opposition a veto-proof majority, and it's hard to see that getting any better for them any time soon — or ever. Incumbents, after all, don't tend to do too well when, according to the International Monetary Fund, their economy shrinks 10 percent one year, an additional 6 percent the next, and inflation explodes to 720 percent. It's no wonder, then, that markets expect Venezuela to default on its debt in the very near future. The country is basically bankrupt.
- The $3 Trillion Question – Why China should not devalue its currency
Buffeted by a slowing economy, a falling stock market, and a rising tide of money leaving the country, China is flirting with weakening its currency, the renminbi (RMB). Despite repeated — and very high-level — pledges to maintain its value, Beijing quietly let the RMB slip 5 percent against the U.S. dollar in 2015. Many see its decision in December to switch the RMB’s peg from the dollar to a basket of currencies as a back-door way to piggyback on the weakening of other currencies against the dollar. Meanwhile, a growing chorus of economists, hedge funds, and policymakers are saying that China must “go with the market” and let its currency fall to save its stumbling economy. “China should stop resisting Renminbi depreciation. The currency is overvalued,” tweeted economist Jeffrey Sachs. In mid-January, at the World Economic Forum in Davos, Switzerland, Goldman Sachs President Gary Cohn agreed China has little choice: “They may have to do something in the next six months.… Do I believe they will end up devaluing the currency? I do.”
- The End Of Plan A: The Big Reset & $8000 Gold
Willem Middlekoop, author of The Big Reset – The War On Gold And The Financial Endgame, believes the current international monetary system has entered its last term and is up for a reset. Having predicted the collapse of the real estate market in 2006, (while Ben Bernanke didn't), Middlekoop asks (rhetorically) -can the global credit expansion ‘experiment' from 2002 – 2008, which Bernanke completely underestimated, be compared to the global QE ‘experiment' from 2008 – present? – the answer is worrisome. In the following must-see interview with Grant Williams, he shares his thoughts on the future of the global monetary system and why the revaluation of Gold is inevitable…
- Full Summary Of Chinese Actions To Prevent An All-Out Economic Collapse
Last summer, China unleashed an unprecedented array of measures – up to and including the arrest of “malicious short sellers” and prominent hedge fund mangers – to prevent its stock market bubble from bursting. It failed. A few months later, the chaos has spilled over from the relative containment of the capital markets and has engulfed not only the country's FX reserves, and capital account, but also the entire economy. As a result, China’s government has gone all in, and as Bloomberg reports, is stepping up efforts to ward off a potential financial crisis, warning bank executives that their jobs are on the line unless they control risks and putting restrictions on an increasingly popular way of evading capital controls. These moves come in response to China's slowest economic growth in a quarter century fueled concerns that bad debts will cripple the banking system and a catalyst for why virtually every hedge fund is now short the Yuan.
- The Big-Oil Bailouts Begin
Despite a bounce this week, low oil prices continue to sow fear, uncertainty, and mayhem across the emerging market complex. On Wednesday, it was leaked that the IMF and World Bank would dispatch a team to oil and gas-dependent Azerbaijan to negotiate a possible $4 billion emergency loan package in what threatens to become the first of a series of global bailouts stemming from the tumbling oil price.
- This Silver Investor is “Hell Bent on Taking the Precious Metals Battle Back to the Banksters”
I see a connection to what happened during the 85 cent silver flash crash and NIRP. It’s tenuous but there are linkages to any flash crash. The formalization of negative interest rates evolved in Europe for several reasons, and just migrated to Japan. I’m certain it’ll come to the US once NIRP’s wrecked its toll in these GDP heavy economies. The EU project with it’s failing currency, bank debt, leverage, business disabling socialist friction, crushingly high taxes, and thuggish control polices were quite predictable 5 years ago. Even before that time the issues of uncontrolled borders and infiltration of migrants began to press on the movement of people and currency as the situation grew slowly to critical mass.
- Puerto Rico wants to erase half its debt
Puerto Rico has a new plan to get out of its massive debt crisis: Use a big eraser. The island's taxpayers are currently on the hook to pay back about $50 billion. On Monday, Puerto proposed cutting that nearly in half to $26.5 billion. So far, Puerto Rico's creditors are not impressed. “It's frustrating, and it doesn't feel like a credible offer,” a person close to major creditors told CNNMoney.
- Retail Apocalypse: 2016 Brings Empty Shelves And Store Closings All Across America
Major retailers in the United States are shutting down hundreds of stores, and shoppers are reporting alarmingly bare shelves in many retail locations that are still open all over the country. It appears that the retail apocalypse that made so many headlines in 2015 has gone to an entirely new level as we enter 2016. As economic activity slows down and Internet retailers capture more of the market, brick and mortar retailers are cutting their losses. This is especially true in areas that are on the lower portion of the income scale. In impoverished urban centers all over the nation, it is not uncommon to find entire malls that have now been completely abandoned. It has been estimated that there is about a billion square feet of retail space sitting empty in this country, and this crisis is only going to get worse as the retail apocalypse accelerates.
- Federal debt hits $19 trillion; new record set
The federal government is now officially $19 trillion in debt, according to the latest figures released by the Treasury Department Monday that show the Obama administration crossed that ignominious line late last week. President Obama took office with the debt at $10.6 trillion, and has added more than $8 trillion during his seven years in the White House — a record pace that the Congressional Budget Office says is likely to continue.
- ALERT: Legend Warns Global Governments Are Now Preparing For Total Collapse
Egon von Greyerz: “Eric, 25% of government bonds are now negative around the world. On Friday morning Bank of Japan was the latest country to introduce negative rates. There are now 13 countries with yields up to 2 years being negative and 10 countries with negative yields up to 10 years. I have been saying for a very long time that Japan is bankrupt and negative rates will of course not save their economy…
- British scientists granted permission to genetically modify human embryos
British scientists have been granted permission to genetically modify human embryos by the fertility regulator. The Francis Crick Institute could begin the controversial experiments as early as March after the Human Fertilisation and Embryology Authority (HFEA) gave the green light this morning.
- PETER SCHIFF: We're going to have a serious recession and negative interest rates before the election
Based on today's GDP release, it appears that the US economy is slowing but not near any sort of massive collapse. Peter Schiff begs to differ. The CEO and chief global strategist for Euro Pacific Capital, and noted perma-bear, said that serious economic destruction is just a few months away. “I think the Fed is going to have negative interest rates before the election because we're going to be in a serious recession,” Schiff told Business Insider on Friday. In fact, Schiff said that we may already be in recession and this one is going to be a doozy. “We're in worse shape now than we were in 2007,” he said.
- US hedge funds mount new attacks on China’s yuan
Some of the biggest names in the hedge-fund industry are piling up bets against China’s currency, setting up a showdown between Wall Street and the leaders of the world’s second-largest economy. Kyle Bass’s Hayman Capital Management has sold off the bulk of its investments in stocks, commodities and bonds so it can focus on shorting Asian currencies, including the yuan and the Hong Kong dollar.
- Court rules Michigan has no responsibility to provide quality public education
In a blow to schoolchildren statewide, the Michigan Court of Appeals ruled on Nov. 7 the State of Michigan has no legal obligation to provide a quality public education to students in the struggling Highland Park School District.
- Oil Production Cuts Unlikely to Reverse Plunging Prices
A cut in oil production by Organization of the Petroleum Exporting Countries (OPEC) member states, as well as other oil exporters, is unlikely to make a difference in terms of the low oil prices, experts told Sputnik.
- Peter Boockvar – Japan Just Launched An Economic Kamikaze Against Its Citizens And The World – Own Gold
“I only have a few things to say about what Mr. Kuroda and 4 other members of the BoJ decided to do (4 dissented). It’s a tax on money that banks will just pass on to their customers. Wanting higher inflation without faster wage growth is a tax on consumers. And, the BOJ just amped up the global currency battles. I call this economic Kamikaze and I’ll say for the millionth time, I just don’t get the bear case on gold in light of this with fiat currency having such a large bulls-eye target on it. Believing that generating higher inflation is a needed precursor to faster economic growth is nonsense. Inflation reads are a symptom of the activity of the underlying economy. I’ll also repeat the irony that markets love it when the BoJ and ECB further debase their currencies but freak out when the Chinese also want a weaker yuan.”
- Mainstream Media Starting to Sound the Recession Warning Siren
Ever since the Federal Reserve raised interest rates in December, Peter Schiff has insisted that the state of the US economy didn’t justify the move. In fact, on numerous occasions, Peter has said the US may already be in a recession. If not, we are on the verge of entering one.
- Bank of Japan, in a Surprise, Adopts Negative Interest Rate
As Japan’s economic doldrums have lingered, its leaders have tried a number of tricks over the years, from increasing government spending to flooding the financial system with cash. With the global economy looking increasingly fragile, Japan is now taking a more aggressive step by cutting interest rates below zero on Friday. The policy — which means banks are essentially paying for the privilege of parking their money — represents a last resort for a country that has struggled through a quarter-century of weak growth. In theory, negative rates will push banks to lend more to companies, which would then spend and hire.
- EU on brink: Germany's biggest bank records shock losses risking economic RUIN of Eurozone
GERMANY could force the European Union into ruin after Deutsche Bank's share price plunged following the country's biggest lender's first annual loss since the financial crisis. The German lender posted a full year loss of £5.1 billion (€6.8bn) on Thursday – higher than the expected €6.7bn million. With losses of €2.1bn in the fourth quarter of 2015-16, fears of the entire eurozone toppling are becoming an increasing reality.
- World Bank and IMF in emergency BAILOUT talks to save countries from bankruptcy over oil
TUMBLING oil prices are plunging emerging economies into financial crisis, sparking what could be the start of a global economy meltdown. The International Monetary Fund (IMF) and the World Bank are extremely worried about the financial stability of Brazil, Venezuela and Ecuador, which are heavily reliant upon oil profits. And the two organisations are now set to discuss an emergency fund of a possible $4billion emergency to bailout Azerbaijan in what risks to become the first bailout of a country due to oil. Iran's neighbour has been thrown into a currency crisis thanks to falling prices.
- 80% Stock Market Crash To Strike in 2016, Economist Warns
Several noted economists and distinguished investors are warning of a stock market crash. Billionaire Carl Icahn, for example, recently raised a red flag on a national broadcast when he declared, “The public is walking into a trap again as they did in 2007.” And the prophetic economist Andrew Smithers warns, “U.S. stocks are now about 80% overvalued.” Smithers backs up his prediction using a ratio which proves that the only time in history stocks were this risky was 1929 and 1999. And we all know what happened next. Stocks fell by 89% and 50%, respectively. Even the Royal Bank of Scotland says the markets are flashing stress alerts akin to the 2008 crisis. They told their clients to “Sell Everything” because “in a crowded hall, the exit doors are small.” Stocks like Apple, will plunge.
- Marc Faber: Market Crash Will Rival 1987's Massive Drop
Marc Faber, publisher of the Gloom, Boom & Doom Report, said markets could see a sudden crash similar the one in 1987, when the Dow Jones Industrial Average fell about 23 percent in one day. “[The market] will remain very volatile because interventions with fiscal and monetary policies, instead of lowering volatility they postpone it, and then it explodes,” he said to CNBC. “The average stock in the U.S. is already down 26 percent from its 52-week high and there are a lot of stocks that are down 50 percent or more. The indices have hidden the weakness beneath the surface and basically the market has been weak the whole time.”
- Analysis: Behind the global stock market plunge of 2016
Global equity markets have been on a rollercoaster ride since the opening sessions of 2016. The violent lurch lower in stocks was initially triggered by fears that an economic slowdown in China, the world's second largest economy, was spinning out of control. But it was the spectacular collapse in oil prices that really lent impetus to the January sell-off. “Fear, not economic fundamentals, sparked the frenzied sell-off in China as the new year got under way which then spread to global markets and the oil price slide has compounded the pessimism,” said Beijing-based economist Chen Chen, at the Economist Intelligence Unit.