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 August 19, 2016 to August 25, 2016:
- These Charts Are Flashing Recession Signals
No one knows how long the current economic expansion will continue. But some seven years after the last recession ended, economists are keeping an eagle eye on the latest data looking for signs that another downturn may be approaching. For now, much of the economic data is pointing to continued, if somewhat weak, growth. Companies are hiring, wages are rising slowly and consumers are spending. But belt-tightening by businesses on investment in new equipment and buildings could be a sign of a deeper slowdown ahead, according to economists at Credit Suisse. “Extended periods of falling real business investment are strongly associated with US recessions,” they wrote in a note to clients. “That’s why the recent three consecutive quarters of contraction are concerning.”
- What Is Happening In Japan Is Not Good…But Gold & Silver Remain Firm
What is happening in Japan is not good…but gold and silver remain firm. A portion of today’s note from Peter Boockvar: Japan’s index for August was up a touch at 49.6 from 49.3 in July. It’s below 50 now for a 6th straight month which also coincides with the yen move from 120 to 100… With the yen hovering just above 100, the Nikkei cannot get out of its own way EVEN WITH ALL THE ETF BUYING by the BoJ and it closed down by .6%. The 10 yr JGB yield was down by 2 bps at -.08 but still remains 20 bps off its extreme low of four weeks ago. The Topix bank index was down by 1.4%. King World News note: Below you can see a 30-year chart of Japan’s Nikkei Index. This is the area where the bulls, in this case primarily the Bank of Japan, need to start the next leg higher. Because if the Nikkei breaks below that critical support level, it will trade extremely aggressively to the downside.
- The Biggest American Layoff Queens in 2016 “So Far”
The most recent company to announce four-digit layoffs was Cisco on Wednesday with 5,500 people on its list. It followed numerous other announcements of mass layoffs this year – particularly in oil-and-gas, brick-and-mortar retail, and tech. Since the oil bust began, there have been 195,000 job cuts in the US alone, according to Challenger, Gray & Christmas. Of those, about 95,000 occurred in 2016. They were concentrated in just a few states, particularly Texas. And it’s not over: there was a “resurgence” of 17,725 job cuts in July. Tech announced about 55,000 layoffs so far this year, including Cisco. The sector is getting clobbered by a sea change in technology, the shift to mobile, and the downward spiral of the entire PC ecosystem. And retail announced nearly 44,000, not including Macy’s still unspecified job cuts associated with shuttering 100 Macy’s stores. So 24/7 Wall St. interviewed John Challenger, CEO of Challenger, Gray. And digging into additional data, it came up with its list of the biggest layoff announcements in 2016 so far – “so far” because the year isn’t over yet.
- BRICS economies moving away from recession
The currencies of three BRICS economies have steadily strengthened against the US dollar in recent weeks. Brazil’s real, Russia’s ruble and South Africa’s rand have benefited from a ‘pause’ in the momentum to raise interest rates, particularly in the US. All three countries have battled recession in contrast to BRICS members China and India, which are forecast to grow 6.7 per cent and 7.6 per cent, respectively, in 2016.
- Business Loan Delinquencies Rock Past Lehman Moment Level
This afternoon, somewhat obscured by the Fed’s media-savvy and endless flip-flopping about rate hikes, the Board of Governors of the Federal Reserve released its second quarter delinquencies and charge-off data for all commercial banks. It shows that if the Fed wanted to raise rates before serious signs of trouble emerged, it might have missed the train. Consumer loans are still doing well, though delinquencies have ticked up 10% from a year ago to $26.8 billion. Loans are considered “delinquent” when they’re 30 days or more past due. Credit card loans are also still doing well, though delinquencies have jumped 11% from a year ago to $13.8 billion.
- James Grant: The Fed is Now Hostage to Wall Street
James Grant, Wall Street expert and editor of the investment newsletter «Grant’s Interest Rate Observer», warns of a crash in sovereign debt, is puzzled over the actions of the Swiss National Bank and bets on gold. From multi-billion bond buying programs to negative interest rates and probably soon helicopter money: Around the globe, central bankers are experimenting with ever more extreme measures to stimulate the sluggish economy. This will end in tears, believes James Grant. The sharp thinking editor of the iconic Wall Street newsletter «Grant’s Interest Rate Observer» is one of the most ardent critics when it comes to super easy monetary policy. Highly proficient in financial history, Mr. Grant warns of today’s reckless hunt for yield and spots one of the biggest risks in government debt. He’s also scratching his head over the massive investments which the Swiss National Bank undertakes in the US stock market.
- Merkel Prepares For A Deliberate Crisis While White House Plans For A Disastrous Succession
Europe is convulsed by Islamic immigration, Brexit and a brutal economic state-of-affairs that are making it difficult for the average European citizen to live anything like a normal life or plan for the future. Germany is one place where this sort of fear is being aimed at the population on a daily basis. Angela Merkel’s government has just urged Germans to stockpile enough food and water for ten and five days, respectively “in case of an attack or catastrophe.” Germany is also mulling a return to a military draft. On the surface, Merkel is simply trying to prepare Germans for every eventuality. She is, you see, a caring leader who wants the best for her people.
- Giant Fraud Economy Crashes Before End of 2016-Gerald Celente
Trends forecaster Gerald Celente has been predicting a financial panic in 2016. How close are we? Celente says, “I believe we are very near an inflection point coming up very soon. . . . I would have thought this would have happened back in 2012; however, there has never been such a thing as quantitative easing. There has never been such a thing as zero interest rate policy and negative interest rate policy. We make forecasts based on information that used to be, but now we have things that never were. . . . I was never taught that central banks could take over the economy as it is now. This is not capitalism. Capitalism is dead–it’s now bankism. The only thing that is keeping this up is a giant fraud. October is usually the killer month. . . . I believe the crash will happen before the end of the year, and it almost happened with Brexit.
- Four more mega-banks join the anti-dollar alliance
That was fast. Yesterday I told you how a consortium of 15 Japanese banks had just signed up to implement new financial technology to clear and settle international financial transactions. This is a huge step. Right now, most international financial transactions must pass through the US banking system’s network of correspondent accounts. This gives the US government an incredible amount of power… power they haven’t been shy about using over the last several years. 2014 was one of the first major watershed moments when the Obama administration fined French bank BNP Paribas $9 billion for doing business with countries that the US doesn’t like– namely Cuba and Iran.
- Barack Obama may have finally destroyed America’s #1 advantage
In July 1944, just weeks after the successful Allied invasion of Normandy, hundreds of delegates from around the world gathered in Bretton Woods, New Hampshire to determine the future of the global financial system. The vision was simple: America would be the center of the universe, and every other nation would revolve around the US. This arrangement ultimately led to the US dollar being the world’s dominant reserve currency which still remains today. Whenever a Brazilian merchant pays a Korean supplier, that deal is negotiated and settled in US dollars. Oil. Coffee. Steel. Aircraft. Countless commodities and products across the planet change hands in US dollars, so nearly every major commercial bank, central bank, multi-national corporation, and sovereign government must hold and be able to transact in US dollars. This system provides a huge incentive for the rest of the world to hold trillions of dollars worth of US assets– typically deposits in the US banking system, or US government bonds.
- China has taken over Scotland's North Sea oil production
China has taken over Scotland's oil production and now controls two of the North Sea’s biggest oilfields. According to The Times' analysis of China National Offshore Oil Corporation's (CNOOC) accounts, a CNOOC-owned company Nexen extracts nearly 200,000 barrels of oil per day across those two fields. This makes it the largest producer in the area.
- China caught in ‘dead money' trap as central bank plead for fiscal stimulus
China is at mounting risk of a Japanese-style “liquidity trap” as monetary policy loses traction and the economy approaches credit exhaustion, forcing a shift towards Keynesian fiscal stimulus. Officials at the Chinese People’s Bank (PBOC) have begun to call for a fundamental change in strategy, warning that interest rate cuts have become an increasingly blunt tool. They cannot easily stop companies hoarding cash or halt the slide in private investment. Sheng Songcheng, the PBOC’s head of analysis, set off a storm last month by warning that the economy had “started to show some signs of being caught in a liquidity trap”.
- Dr. Jim Willie: We Are on the Brink of World War; Americans Totally Clueless
In the article following the interview below with Dr. Jim Willie, Michael Snyder sums up what is happening in the world right now geopolitically absolutely perfect in his opening line where he says, “War is coming, but unfortunately most Americans are completely oblivious to what is about to happen.” Truthfully, an argument could very easily be made that the world has never been in as much danger from World War III, or from nuclear annihilation as it is right now, and that includes during the Cuban Missile Crisis. Don’t expect to hear that anytime soon coming from the woefully dishonest Obama administration, or from their lackeys in the mainstream media though. If you listen to their lies long enough, you might even start believing that world peace is imminent, or that the economy is in what they refer to as a “robust” recovery.
- The ultimate breakdown likely to be surprising, sudden, intense, and large
On January 30, 2000, the 88+ million viewers of Superbowl XXXIV were treated to a commercial featuring a now infamous sock puppet. The advertisement was from a company called Pets.com, founded just two years before in 1998 at the height of the dot-com bubble. Pets.com went public on the NASDAQ just weeks after the Superbowl with the symbol IPET. And just 270 days later it was out of business, its stock price having fallen from $11 to just 19 cents in the interim. The autopsy showed that Pets.com was selling its products at nearly 30% below cost, giving rise to the old mystifying dot-com logic, “We lose money on every sale but make up for it in volume.” Granted, Pets.com did not have the benefit of a printing press, monopoly over the money supply, or worldwide intransigence in the existing financial system, so they couldn’t kick the can down the road too far. But it remains yet another hallmark of one of the most important lessons in financial history: sooner or later, bubbles correct.
- Gerald Celente Sees Worst Market Crash, New Military Conflict, and Gold Spike to $2,000/oz
Gerald Celente: The stock market's being propped up. We said this beginning with Quantitative Easing when it began, and we said that this is not a recovery. It's a cover-up. The numbers don’t lie. The liars lie, and the markets are lying. You look at the facts, and here are the facts. You had a stretch of merger and acquisition activity unparalleled in world history because they're borrowing money for nothing and they're buying up companies. Then you look at the other facts, and the facts are that stock buy-backs are at record highs. What was it, like the first 3 months of this year, you looked at about, what, $160 billion worth of stock buy-backs. And all this has done is boosted the equity markets. Again, these are the facts, and I know that the people listening to your show want the facts. Ninety-five percent of the wealth created since 2009 in the United States went to that famous 1%. It's a fact, a fact worldwide. 62 people… everybody knows at least 62 people… imagine the 62 people that you know having more wealth than half the world's population combined.
- Japanese Corporate Earnings Heading For Worst Decline Since The Earthquake
After first-quarter earnings in Japan wrapped up this month with the steepest plunge since 2011, the prospect for an increase in annual profits is about to get even dimmer. Expect a round of corporate earnings downgrades in September, said Norihiro Fujito, a strategist at Mitsubishi UFJ Morgan Stanley Securities. Trends that slammed profit in the first quarter — a stronger yen, negative interest rates and slumping China growth — haven’t reversed. At stake is a second straight year of earnings decline that could bury Prime Minister Shinzo Abe’s push for companies to boost capital spending and raise wages to spur economic growth. “A lot of companies may be lowering their forecasts in September,” said Fujito. A slower recovery in the U.S. economy than some had expected is also weakening the outlook for Japan’s carmakers and other exporters, he said.
- As Predicted, Obamacare Is Absolutely Killing The Middle Class
The critics of Obamacare have been proven right. The Obama administration promised that health insurance premiums would go down. Instead, they have absolutely skyrocketed. The Obama administration promised that Obamacare would not kill jobs. Instead, firms are hiring fewer workers because of suffocating health care costs. As you will see below, even the Federal Reserve is admitting this. The Obama administration also promised that the big health insurance companies would love the new Obamacare plans and would eagerly compete with one another to win customers in the new health insurance marketplaces. Instead, many of the big health insurance companies are now dropping Obamacare plans altogether.
- Obamacare Is The Welfare State’s Requiem
In the hymn for the dead for the Catholic Mass, the text of “Dies Irae” starts, “The day of wrath, that day will dissolve the world in ashes.”For Obamacare, this is that day, and it could portend a future in which the mighty ambitions of the welfare-state shrivel and die. Think of how Obamacare was supposed to be the domestic apotheosis of the whole of the Obama presidency. It was passed at the end of term one, and – just to be safe – it waited to be implemented in term two. It was the culmination of a decade, or really several, of expert opinion on how the national health care industry would be designed. The academics, the opinion makers, the top industry reps all met in endless meetings, hammering out all the details with the D.C. masters of legislation. The power of state would make all things right. At last, there would be fairness and equality. Justice and efficiency too! All the good things about the American system would persist, only it would be much better. There would be falling premiums because the risk would be distributed. Competition would be managed and not chaotic. And all things would be covered for everyone. No one would slip through the cracks.
- Citigroup Is About To Relive Its 2008 Derivatives Nightmare
Deutsche Bank AG (NYSE: DB) – with its stock now trading at a 30-year low – was recently called the world’s riskiest financial institution by the International Monetary Fund. Better late than never… In a last-ditch effort to save itself, DB is trying to dump a bucket load of credit derivatives – the murky, risky financial instruments that triggered the 2008 financial crisis. You would think no one would buy these weapons of financial mass destruction… but you’d be wrong. In a staggeringly stupid move, the American bank I’m telling you about today has gone on a derivatives shopping spree, eagerly taking credit default swaps off the hands of failing Eurozone banks like DB and Credit Suisse Group AG (NYSE ADR: CS). That means, of course, another outsize short opportunity for you to take…
- Solid Evidence That The Media Is Biased Against Donald Trump
Once upon a time, the mainstream media worked very hard to maintain the illusion that they were “objective” and “unbiased” when it came to reporting on national elections, but now those days are long gone. Some of the biggest newspapers in the country like the New York Times and the Washington Post are publishing hit piece after hit piece in an all-out attempt to destroy Donald Trump. In fact, if you go to just about any prominent mainstream news website on any particular day, it is inevitable that you will find an anti-Trump story on the main page right near the top, and it is usually accompanied by a pro-Clinton story nearby. Of course the big cable news networks are constantly spewing an endless stream of anti-Trump propaganda as well. In fact, it has been documented that CNN has spent literally half their time on anti-Trump stories on certain days. The elite are desperate to keep Donald Trump out of the White House, and if that means shedding all notions of media objectivity and sicking their attack dogs on Trump day after day, then that is precisely what they are going to do.
- Detroit Has Gone From Being The Greatest Manufacturing City In The World To A Global Joke
In 1960, the city of Detroit was the greatest manufacturing city that the world had ever seen. Nearly two million people lived there, and it had the highest per capita income in the United States. That may be hard to believe, because today it actually has one of the lowest per capita incomes of all of our major cities. Over the decades more than a million people have left the city, and thousands of abandoned homes have been torn down. But there are still tens of thousands of abandoned dwellings that remain standing, and some have sold for as little as one dollar in recent years. Once Detroit was the envy of the entire planet, but now it has become a global joke and in other countries they love to do news stories about “the ruins of Detroit” to show how rapidly America is rotting and decaying. Sadly, Detroit is far from alone, because there are other formerly great manufacturing cities that have declined just as fast as Detroit has.
- Fed Goons Will Not Raise Rates Until 2017-Craig Hemke
Financial writer and precious metals expert Craig Hemke says forget about new threats that the Federal Reserve is raising interest rates in September. Hemke explains, “They are trying to move things by talking, which is their primary policy. That’s why so many of these Fed goons, not Fed Governors, as we like to say, that’s why they seem to have conflicting messages all the time. They are always trying to get the markets to do what they want them to do. Rational human beings are telling you that they are not going to raise rates in September. Not only are they going to do it right before an election, that never happens, if you look at FOMC minutes, the expectations actually went down. . . . People see through the nonsense, and actually you’ve got to go all the way out to March of next year, seven months from now, before you at least have a 50/50 likelihood of a an interest rate hike.”
- Can US Citizens Defeat UN Troops On America Soil?
The establishment is practicing to defeat rogue American units who will fight to defend the people in the coming martial law subjugation enforced by foreign troops from the United Nations in UWEX 16. Troops at Ft. Carson will be working with foreign troops to defeat civilian forces with COMBAT TROOPS. Foreign mercenaries are training in Northern Colorado to defeat Guerrilla forces consisting of American citizens. Denver Internation Airport just conducted a mock Guerrilla raid on the airport. Foreign troops from Poland and Denmark are training for mass incarceration and gun confiscation at Camp Grayling in Michigan. The above stories will be covered in the next release of the Red List News. For now, these stories illustrate that the current Junta running DC is preparing to fight American citizens in a guerrilla war and we are the Viet Cong.
- Germany to tell people to stockpile food and water in case of attacks
For the first time since the end of the Cold War, the German government plans to tell citizens to stockpile food and water in case of an attack or catastrophe, the Frankfurter Allgemeine Sonntagszeitung newspaper reported on Sunday. Germany is currently on high alert after two Islamist attacks and a shooting rampage by a mentally unstable teenager last month. Berlin announced measures earlier this month to spend considerably more on its police and security forces and to create a special unit to counter cyber crime and terrorism. “The population will be obliged to hold an individual supply of food for ten days,” the newspaper quoted the government's “Concept for Civil Defence” – which has been prepared by the Interior Ministry – as saying. The paper said a parliamentary committee had originally commissioned the civil defence strategy in 2012.
- Trillionaire Rothschild Warns His Own Central Banking System Is Failing And Buys Gold
We have been highlighting the wave of billionaires who are all getting out of the stock market this summer and buying gold. Well, now it’s a trillionaire. Of course, he’s not “officially” on top in the “most wealthy” lists… but that is because the Rothschilds have been experts in hiding their wealth for centuries. When Jacob’s great-great-great-great grandfather, Mayer Amschel Rothschild, died in 1812, his will explicitly stated that no public inventory of his estate was to be published and that no legal action was to be taken with regard to the value of the inheritance. It’s also been suggested that the Rothschilds use private, unrecorded, limited partnerships to accumulate wealth (you know, like all the ones in the Panama Papers).
- The man who accurately predicted 4 market crashes told us 3 more dates to worry about this year
The man who accurately predicted four market crashes to the exact date each time has told Business Insider about three more dates to worry about. Sandy Jadeja is a technical analyst and chief market strategist at Core Spreads. Technical analysts look at charts to pinpoint patterns in various markets and asset classes. From that, they forecast which direction prices are likely to move. They can't tell you the reasons why there will be a big market movement, only that there is going to be one.
- The CFR Releases a Promotional Video Trying to Appear Friendly … But it’s NWO Propaganda
The Council on Foreign Relations tweeted a video promoting its merits using all kinds of celebrities and powerful people. If it tried to appear friendlier to the masses, it failed. It only proved that a select elite truly congregates behind closed doors to push a New World Order agenda.
- The Road to Stagflation—–The Case Of Norway
We have all heard the incredible stories of housing riches in commodity producing hotspots such as Western Australia and Canada. People have become millionaires simply by leveraging up and holding on to properties. These are the beneficiaries of a global money-printing spree that pre-dates the financial crisis by decades. The road toward such outsized gains in property is not paved with some global savings glut concocted by theoretical economists, but have rather been a process whereby the US leveraged up its economy-wide asset base allowing the Chinese to print ‘dollars’ with abandon.
- Memo To Hillbama: $15 Federal Minimum Wage Equals 7 Million Job Losses
James Sherk, of The Heritage Foundation, recently took a look at what impact a $15 federally-mandated minimum wage might have on employment levels in each of the 50 states. Unsurprisingly, the study concludes that the impact would be substantial with approximately 7mm jobs lost, or roughly 6% of current full-time jobs in this country. As we pointed out before, imposing artificial floors on wages really only serves to improve returns on capital investment by businesses resulting in permanent job losses and higher unemployment in the long-term.
- Big Yellow Update: Caterpillar Retail Orders Suffer Second Biggest Plunge Since Financial Crisis
While the relentless decline in Caterpillar retail sales has been duly noted here every month for nearly 4 years, now posting 44 consecutive declines, the latest, July data was downright depressionary. According to the company, in the latest month – just when China was supposed to be rebounding and the US recovery getting “stronger” – demand took another sharp leg lower, as follows: North America machine sales down 20% after falling 12% in June, Asia/Pacific sales July down 7% after falling 7% in June, Latam sales July down 43% after falling 38%, EAME (Europe, Africa, Middle East) sales July down 13% after falling 4%, This means that Caterpillar’s rolling 3-month retail machine sales dropped by 19% in July vs the more modest 12% fall in June and May. It also means that, as shown in the chart below, in the past month CAT retail sales just posed the second largest monthly drop since the financial crisis.
- Gold Is Standing At The Crossroads
I haven’t written anything about gold here since I noted that one of Paul Tudor Jones’ favorite indicators suggests the bear market in gold is over. While I still believe we have begun a new bull market for the precious metal, the technicals have me concerned about a short-term correction. Gold is now running into a confluence of important resistance. The pair of trend lines on the chart below intersect right here right now. This intersection also lines up with the 38.2% Fibonacci retracement of the bear market decline from 2011 to 2015.
- Here Is An Important Update On The War In The Gold & Silver Markets
What this means is that gold and silver may still head significantly higher, but they remain vulnerable to the possibility of a pullback in the near-term. It is very difficult to predict how the metals will react to such historic commercial short positions in a secular bull market. So far it has just meant higher prices for gold and silver followed by consolidation. We will see what the next few weeks holds as we get ready to enter the seasonally strong period for precious metals in the fall.
- Another Billionare Goes All In On The “Barbarous Relic” Gold While Mainstream Media Remains Silent
Billionaire Crispin Odey recently released a management letter to his hedge fund clients praising gold and explaining gold products constituted the next, great investment wave. He is yet another in a wave of billionaires who have all, suddenly, been moving massive portions of their portfolio into gold… with one of the latest being George Soros, who moved a significant amount of his portfolio into gold just a few months ago. It is quite likely that both of these individuals are familiar with TDV’s Shemitah and Jubilee Year analysis. That’s not to say they read TDV (of course they may – and should), but they understand the larger, secretive events associated with these occult timelines. That may be in fact one reason why Soros and other billionaires have been acting this year to realize gold positions. And why Odey, too, has now moved in that direction.
- What Is Happening Around The World Is Scaring The Hell Out Of People
Peter Boockvar: “I’m not surprised because I think a lot of people like us see what’s going on in the world and it scares them. When you see a German bank a couple of weeks ago saying that they are going to start charging depositors of more than 100,000 euros a fee of up to 40 basis points, which is where the ECB has their negative deposit rate, then that’s scary to people. So I applaud people who are, from an investment standpoint, buying more gold because that’s their best defense against against this monetary mayhem that we’re living through. I’m still extraordinarily bullish on gold and silver. Anybody listening to or reading this (on KWN) knows the reasons why. I’m convinced that we saw the bottom late last year. The catalyst this year is the fact that there are multiple signs beginning to buildup that central bankers are losing control…
- This Historic Event Is About To Shock The World
With many investors worried about the economic turmoil that has engulfed the globe, this historic event is about to shock the world. Stephen Leeb: “The world’s monetary system is busted. Unless it is fixed pronto, prospects for worldwide growth are nil, while prospects for worldwide chaos are high. And never forget: in chaos, gold rules supreme. One possible form chaos could take would be galloping commodity prices. An alternative form would be a vicious deflationary cycle in which prices and growth crash and burn. Either way, gold would be the one real shelter. When commodities are soaring, paper money becomes second-class; no one will turn over something with intrinsic value, namely commodities, for mere pieces of paper. As for deflation, over the past 500 years or more whenever deflation emerged, gold gained and sometimes gained big in terms of purchasing power.
- 10 Things We Know About The Mock Human Sacrifice That Was Just Conducted At CERN
Have you seen the video of the “mock human sacrifice” that was conducted right outside the entrance of CERN? A spokeswoman for the European Organization for Nuclear Research (more commonly known as CERN) has told the public that this ritual happened without their permission and that they are looking into the matter. If this “occult ritual” was indeed some kind of “sick joke”, what was the motivation? This new video continues a long string of bizarre events related to CERN and the Large Hadron Collider that is housed there. Last month, I wrote about strange “portal-shaped clouds” that formed over CERN during recent experiments. And the the director of research at CERN, physicist Sergio Bertolucci, has publicly admitted in the past that the Large Hadron Collider could potentially open up a “door” to “an extra dimension”. There has been so much speculation about what is really going on there, and that makes this latest video that much more creepy.
- Are Trolls Turning The Internet Into A Festival Of Hate?
Have you noticed that people say some of the most hateful things imaginable on the Internet? Earlier today, I came across a Time Magazine article entitled “How Trolls Are Ruining the Internet“, and it made me reflect on my own experience as the publisher of a number of prominent websites. Over the years, I have often gotten to see what is really going on in some of the darkest hearts in our society. There are people that come to my websites that somehow think that making crude sexual remarks about the wives and children of people that they have never met is perfectly acceptable behavior. There are others that say incredibly vile things about people that have a different skin color than they do, and some people have a hatred for Christians and the Christian faith that is absolutely frightening. I can’t understand why anyone would want to be like that, but apparently this kind of behavior is very widespread. In fact, one Pew Research Center survey discovered that 70 percent of all 18-to-24-year-olds who use the Internet have experienced harassment at some point.
- “This Could Kick-Start WW3”
‘ISIS' Blueprint For Attacking America (Over 50 Potential Targets). A computer left behind by ISIS fanatics in Syria revealed ISIS eyes over 50 potential targets in USA… What’s curious is that the CIA and FBI chose to focus on one of these 50 targets in particular.'… (This is an interesting video, it turns into a sales letter further on, but it does pose an important question. What happens if the electricity grid gets shut down)…
- ISIS Has A New Focus: Killing Christians And Bombing Churches Wherever They Can Find Them
If you are a Christian, ISIS wants to kill you. Our politicians keep telling us that our battle with ISIS is not a “religious war”, but to ISIS it most certainly is. As you will see below, ISIS has a new focus. They are very clear about the fact that they intend to kill as many “citizens of the cross” as they possibly can, and they plan to bomb churches wherever they can find them. In a previous article, I explained how an entire church in the U.S. ended up on an ISIS kill list, and we just saw in France that they are willing to strike anywhere and at any time. Religious targets now appear to be a top priority for ISIS, and that means that every church and every Christian in the western world needs to start thinking differently about security.
- Will Human Evil Destroy Life On Earth? — Paul Craig Roberts
The World Wildlife Fund tells us that there are only 3,890 tigers left in the entire world. Due to exploitative capitalism, which destroys the environment in behalf of short-term profits, the habitat for tigers is rapidly disappearing. The environmental destruction, together with hunting or poaching by those who regard it as manly or profitable to kill a magnificent animal, is leading to the rapid extermination of this beautiful animal. Soon tigers will only exist as exhibits in zoos. The same is happening to lions, cheetahs, leopards, rhinos, elephants, bobcats, wolves, bears, birds, butterflies, honey bees. You name it. What we are witnessing is the irresponsibility of the human race, a Satan-cursed form of life that does not belong on the beautiful planet Earth. The cursed humans are even capable of launching a nuclear war which would destroy the livability of Earth.
- Secret Federal Reserve minutes leaked
Yesterday the Federal Reserve released the minutes from its July meeting a few weeks ago in which they decided to NOT raise interest rates. These minutes are the official archive of the meeting, providing details about the presentations, debates, and discussions that took place. They contain very formal sounding language, referring to their near-zero interest rates as “accommodation” in the same way that my high school health teacher preferred to use the more clinical term “copulation” instead of “sex”.
- Which Items Will Disappear First During A Major National Emergency?
One day in the not too distant future, a major emergency will strike this nation, and that will set off a round of hoarding unlike anything we have ever seen before. Just think about what happens when a big winter storm or a hurricane is about to hit one of our major cities – inevitably store shelves are stripped bare of bread, milk, snow shovels, etc. Even though winter storms and hurricanes are just temporary hurdles to overcome, they still cause many people to go into panic mode. So what is going to happen when we have a real crisis on our hands? We can get some clues about which items will disappear first during a major national emergency by taking a look at where such a scenario is already playing out. One recent survey found that over 80 percent of all basic foodstuffs are currently unavailable in Venezuela, and about half the country can no longer provide three meals a day for their families. Thankfully, some stores still have a few things that they are able to offer, but other key items are completely gone.
- Economic Update, Russian Bombers Fly Out of Iran, MSM Can’t Stop Trump
So much for the so-called “recovery,” there’s not going to be one. Retail and tech are the latest to signal the economy is tanking. Retail is warning sales are bad. Macy’s is closing 100 stores nationwide. On top of that, tech giant Cisco just fired 20% of its workforce, or about 5,500 employees. Can you believe the Fed is still talking about raising interest rates in September? Fat chance. Russian bombers got clearance to take off from an Iranian airbase to fly missions to attack ISIS in Iraq and Syria. This is a disturbing development because when ISIS is defeated, there is going to be a huge vacuum that Iran will surely fill. Meanwhile, Turkey is warming up to Russia. Things have gotten so bad the U.S. has removed its 50 nuclear weapons from Turkey and repositioned them in Romania. It seems reports show the Middle East is becoming more unstable every week.
- IMF Confirms Negative Rates Are Slowly Killing Banks
For the last two years the European Central Bank (ECB) has initiated a zero- or negative rates policy: its key rate fell to zero, and when a bank deposits cash at the ECB, not only does it not yield anything like before, but the bank must pay a yearly 0.4% interest rate. Mario Draghi’s goal is to discourage banks having their cash sitting idle and to lower the cost of credit in Europe in order to revive economic activity. The cost of money has been lowered for sure, but the volume of credit has only grown a little, not enough to get out of zero growth. On the other hand this long-standing monetary policy generates a massive and catastrophic perverse effect: banks are no longer profitable. In other words, this policy pushes them into bankruptcy. This is what no less than the IMF explains in a study from last August 10. This fall in profitability happens differently depending on the banking systems.
- Hyperinflation Is Nigh So Gold Will Go High
This coming autumn, we are likely to see the beginning of the hyperinflationary phase of the sovereign debt crisis. Hyperinflation normally hits an economy very quickly and unexpectedly and is the result of the currency collapsing. Hyperinflation does not arise as a result of increasing demand for goods and services. The course of events in a hyperinflationary scenario can be summarised as follows: 1. Chronic government deficits, 2. Debt issuance and money printing escalating rapidly, 3. Bonds falling – interest rates rising fast, 4. Currency collapsing. The above process turns into a vicious circle that accelerates quickly. The more money the government prints, the faster the currency will fall and the faster the currency falls the more money the government must print. Once the hyperinflationary spiral has started, it will feed itself like we have seen in the Weimar Republic, Zimbabwe, Argentina and many other places.
- Bank of Ireland to charge for placing cash on deposit
Bank of Ireland is set to become the first domestic financial institution to charge customers for placing their money on deposit with the bank. This unprecedented move comes months after the European Central Bank began charging financial institutions for depositing money with it by charging them 0.4 per cent to hold their cash overnight. The Irish Times has learned that Bank of Ireland, which is 14 per cent owned by the State, has informed its large corporate and institutional customers that it plans to charge them for deposits of €10 million or more from October.
- Monsoon Accessorize restructuring could lead to hundreds of job cuts
Monsoon Accessorize has decided to close its largest shops as part of a restructuring process led by chief executive, Paul Allen. The move could lead to hundreds of redundancies by the British high street retailer. The London-based company could close about 141 shops that have both the Monsoon and Accessorize brands under the same roof. The closures would come as leases expire over the next five years. While the retailer will try to offset these closures by opening separate Monsoon and Accessorize stores, job losses are possible, according to the Guardian.
- UN Report Says Small-Scale Organic Farming Only Way to Feed the World
Even as the United States government continues to push for the use of more chemically-intensive and corporate-dominated farming methods such as GMOs and monoculture-based crops, the United Nations is once against sounding the alarm about the urgent need to return to (and develop) a more sustainable, natural and organic system. That was the key point of a new publication from the UN Commission on Trade and Development (UNCTAD) titled“ Trade and Environment Review 2014: Wake Up Before It’s Too Late,” which included contributions from more than 60 experts around the world. The cover of the report looks like that of a blockbuster documentary or Hollywood movie, and the dramatic nature of the title cannot be understated: The time is now to switch back to our natural farming roots. The New UN Farming Report “Wake Up Before It’s Too Late.”
- The UK to Normalize Relations with Russia in a Major Policy Shift
On August 9, Vladimir Putin and Theresa May spoke for the first time since the UK Prime Minister took office and both expressed dissatisfaction with the current state of Russian-British relations. In the phone call, which was initiated by Great Britain, both leaders agreed to develop a dialogue between security agencies on issues related to aviation security, and made plans for a face-to-face meeting in the near future. The Prime Minister noted the importance of the relationship between the UK and Russia, and expressed hope that, despite differences on certain issues, they could communicate in an open and honest way about the issues that mattered most to them. The President of Russia again congratulated Theresa May on her appointment to the highest office. In a further sign of a thaw in relations between Britain and Russia the new British Foreign Secretary Boris Johnson telephoned Russian Foreign Minister Lavrov on August 12 and apparently called for «normalization» of relations. His call provides definite confirmation that a concerted attempt by Great Britain to improve the relations with Russia is underway. In his articles published by the Daily Telegraph Mr Johnson has made it clear that he stands for the improvement of bilateral ties.
- IMPORTANT! Pastor Williams just sent me an email to share with you: MY ELITE FRIEND SAID…
What is Barack up to now? Executive Order — Providing an Order of Succession within the Department of the Treasury: ‘(b) Notwithstanding the provisions of this Executive Order, the President retains discretion, to the extent permitted by the Act, to depart from this Executive Order in designating an acting Secretary.' Is this some pre-planning for a major disruption in our country?
- Human Freedom Index
The Human Freedom Index presents the state of human freedom in the world based on a broad measure that encompasses personal, civil, and economic freedom. Human freedom is a social concept that recognizes the dignity of individuals and is defined here as negative liberty or the absence of coercive constraint. Because freedom is inherently valuable and plays a role in human progress, it is worth measuring carefully. The Human Freedom Index is a resource that can help to more objectively observe relationships between freedom and other social and economic phenomena, as well as the ways in which the various dimensions of freedom interact with one another.
- Brussels plans to impose MORE austerity on Spain unless it forms a government
BRUSSELS bureaucrats are plotting to impose huge fines and more austerity on battered Spain unless its political parties come together and form a government immediately. According to reports, Europe’s exasperate elite will freeze funding to Madrid, impose further budget cutbacks and rein in regional projects in a bid to bully elected Spanish politicians into cooperating with each other. According to reports in Spanish newspaper La Razon, eurocrats have run out of patience with the country’s MPs as it gears up to hold a third general election in less than a year.
- This Chart Shows Why Gold Hasn’t Topped Yet
I’m starting to see a lot of analysts now calling for gold to drop down into a bottom in October. It’s amazing how these guys can consistently get this wrong over and over again. Gold isn’t topping. Gold has been bouncing around in a range for the last 5 weeks giving the 200 day moving average time to catch up to price. Gold won’t top until the dollar cycle bottoms, and that intermediate cycle isn’t due to bottom until late September or early October. Gold will be making a top in October, not a bottom. But it may have to churn in this range for the rest of August before the next leg up can begin.
- The world's most and least corrupt countries
More than six billion people live in a country with a serious corruption problem. From rigged elections to bribery, unethical dealings run rife in some of the world’s most prominent nations. Using the latest data from Transparency International’s annual Corruption Perceptions Index (CPI) analyzing public sector corruption – we count down the world’s least and most corrupt places.
- As Senkaku tensions surge, Japan eyes missiles to protect its islands: report
The government has decided on a plan to develop land-to-sea missiles with a range of 300 km (186 miles) to protect Japan’s isolated islands, including the Senkakus, a local media report said Sunday, without citing sources. Costs for development will be part of the Defense Ministry’s budget request for the fiscal year ending March 2018, according to the daily Yomiuri Shimbun. The government will aim for deployment around the year ending March 2024, it said. Beijing has been stepping up pressure on Tokyo over the Japan-administered Senkaku Islands, which are claimed as Diaoyu by China and Tiaoyutai by Taiwan.
- Council on Foreign Relations New PR Video Can’t Undo its NWO One World Government Agenda
New World Order propaganda rules and shapes the world. And there’s no more powerful propagator of propaganda that rules and shapes US global hegemony, world events and major geopolitical developments than the Council on Foreign Relations (CFR). On its own website, the CFR describes itself as “an independent, nonpartisan membership organization, think tank, and publisher.” Two weeks ago the powerful organization celebrated its 95th anniversary since it’s been the most influential force dictating US foreign policy throughout the 20th century chauvinistically called “the American century” right into the present 21st aptly called the New World Order century. The CFR is financed by highly endowed, tax-exempt Rockefeller, Ford, and Carnegie foundations.
- Wall Street Can’t Agree on When to Halt the U.S. Stock Market
The trading industry can’t find consensus on when to apply the U.S. stock market’s brakes during times of turmoil. On Thursday, the nation’s three major exchange operators upgraded their rules to help prevent a repeat of the chaos seen on Aug. 24, 2015, when many securities suddenly sank. But a major sticking point remains, according to an official who spoke at an event hours after NYSE Group, Nasdaq Inc. and Bats Global Markets Inc. announced their changes.
- BlackRock Cuts Treasuries Exposure on Hedging Cost as Bonds Fall
BlackRock Inc. is reducing its exposure to long-dated U.S. Treasuries as increased hedging costs from Japan to Europe make the debt less alluring to some foreign investors. Yields on benchmark U.S. 10-year notes are negative for Japanese buyers and about zero for euro-based investors who pay to eliminate currency fluctuations from their returns, even after yields climbed Monday as regional data showed increases in factory shipments and new orders. That’s caused life insurers and other long-term asset managers to turn to corporate securities or mortgage-backed obligations to lock in higher interest rates.
- Reality: Opportunities and Threats – Deepcaster
As The Central Bankers come closer and closer to the point of No Return (and Helicopter Money), the Equities, Inflation, Credit, Housing, Auto and Energy Markets Sectors and Interest Rate and Economic Scene will change DRAMATICALLY… The BLS, GDP and Jobs Numbers recently released, are Frankly Bogus and therefore provide Opportunities for those aware and Threats to those unaware. Consider a couple of Savvy Analysts’ Views of these numbers.
- Carl Icahn Turns Apocalyptic: “I Am More Hedged Than Ever, A Day Of Reckoning Is Coming”
We profiled Carl Icahn's notorious bearishness most recently two weeks ago when we showed that for the second quarter in a row, the billionaire's hedge fund, Icahn Enterprises had kept on its record short bias, manifesting in a net -149% market exposure. Unlike other hedge fund managers, however, Icahn does not provide monthly letters explaining his mindset which is why we eagerly watched a expansive, 40 minute interview he gave to Bloomberg's Erik Shatzker, in which in addition to a detailed discussion of Trump and how the Republican presidential candidate would change the US economy, he shared some much needed insights into his gloomy vision of the market.
- Looking Forward
Since its inception, International Man has offered prognostications about what the future will bring – economically, politically and socially. The principle writers of the publication have been at this for decades. Each one began by studying world economics and politics in order to make the best choices as to where to live, where to invest, where to store wealth, etc. Over the years, each one got better at researching, better at reading the signs and, ultimately, better at predicting future events. But, today, we’re approaching a worldwide crisis point and the study that we undertook decades ago has become important for literally hundreds of millions of people who, whether they realise it or not, will soon be impacted by events in a major way.
- The Odds Of A Global Food Crisis Are Rising
The vulnerability of global food production to extremes of weather is a profound reality that few grasp. Given the current abundance of food globally, confidence in permanent food surpluses and low grain prices is high. Few worry that the present abundance of food could be temporary. But the global food supply is more fragile than we might think, despite historically low grain/agricultural commodity prices. Both corn and wheat have plummeted in price due to current demand/supply. Let's start with one salient fact: there are 7+ billion human mouths to feed now plus hundreds of millions of animals that are being fed grain to supply humanity's insatiable appetite for meat. What few consumers grasp is that the global abundance of food depends on weather extremes remaining rare. If extremes of weather become commonplace, global food surpluses will turn into shortages. In the larger context, the global food supply chain is a real-world system that cannot be “fixed” with financial gimmicks. No amount of money-printing will replace crops lost to weather extremes, replenish depleted fresh-water aquifers, magically rebuild top soil lost to erosion or repair the environmental ravages of industrial pollution.
- Portuguese Bonds Slump As Last-Investment-Grade-Standing Falters
The only thing standing between Portugal's insanely decoupled low bond yields and the ugly fundamental reality is a BBB rating from DBRS which enables The ECB to keep buying the nation's bonds. The problem is, pressure is mounting on DBRS (the only 1 of 4 raters to maintain Portugal as investment grade) to drop the hammer… and Portuguese risk is rising. And in response to these concerns, the last 2 days have seen the biggest surge in Portugal sovereign credit risk in 2 months…
- Morgan Stanley: Oil Prices Will Crash Again Soon
Morgan Stanley’s chief oil analyst Adam Longson just issued some bearish commentary on oil prices, which he says have been buoyed lately by short covering, but are destined to fall again soon. Morgan Stanley currently has a $35 floor price on oil, which could be tested again in the coming weeks due to the aforementioned short covering, record production and reserves, and weakening demand. The firm concludes that fundamentals in the oil market remain very weak, hence the continued bearish view in the face of a 16% bounce off multiyear lows.
- The Great Stock Market Swindle
Finding and filling gaps in the market is one avenue for entrepreneurial success. Obviously, the first to tap into an unmet consumer demand can unlock massive profits. But unless there’s some comparative advantage, competition will quickly commoditize the market and profit margins will decline to just above breakeven. Unfortunately, finding and filling gaps in the market is much easier said than done. Even the most successful serial entrepreneurs fail more often than they succeed. What’s more, success in one endeavor doesn’t guarantee success in another. Anyone who has ever developed and marketed a new product from concept through sale knows how difficult it is to achieve profitability. For every good idea there must be a hundred bad ones. Yet the only way to really know the difference between a profit generating idea and a cash hemorrhaging fiasco is through trial and error.
- A Stunning Admission From Deutsche Bank Why A Shock Is Needed To Collapse The Market, And Force A Real Panic
In what may be some of the best, and most lucid, writing on everyone’s favorite topic, namely “what happens next” in the evolution of the financial system, Deutsche Bank’s Dominic Konstam, takes a look at the current dead-end monetary situation, and concludes that in order for the system to transition from the current state of financial repression, which has made a mockery of all asset values due to central bank intervention, to a semi-credible system driven by fiscal stimulus, there will have to be a crash, one which jolts policymakers out of their stupor that all is well simply because stocks are at all time highs.
- Overwhelmed By Debt, Nearly 1 In 5 Young Adults Live With Their Parents Or Grandparents
In America today, more than 60 million people live in multi-generational households. That number is so large that it may seem difficult to believe, but the truth is that vast numbers of young adults have had to move back in with their parents and grandparents in recent years due to the deteriorating economy. Millions of our young people cannot find decent jobs once they leave school, and millions of them are absolutely overwhelmed by debt. Of course some of them are just lazy, but whatever the reason it is undeniable that multi-generational households are on the rise. According to the Pew Research Center, 12 percent of the U.S. population was living in multi-generational households back in 1980. Today, that number is up to 19 percent. That means nearly one out of every five U.S. adults now live with their parents or their grandparents. One of the big culprits, of course, is student loan debt.
- Most Billionaires Are Bearish on Stocks — Should You Be?
Many of investing’s elite have made very bearish calls on stocks recently, but their motives and interests aren’t at all aligned with everyday investors’. Stan Druckenmiller. George Soros. Carl Icahn. Jeff Gundlach. Bill Gross. Donald Trump. What do they all have in common? They’ve all made it very clear that they do not like stocks right now. With the exception of Trump, the remaining names in the list above know far more about the markets than the average mom-and-pop investor. But that doesn’t mean we should listen to them.
- Financial Crash will be Put On Little People-Ellen Brown
Public banking expert Ellen Brown thinks big banks will be saved from a coming calamity at the expense of the little people. Brown explains, “I think the big banks won’t go down. They are protected by the bail-ins, which we haven’t yet seen in the U.S., but we’ve seen them in Europe starting in Italy. They did them starting last year. There were four small banks that got bailed-in . . . they took deposit accounts where they got some interest, and they were called bond holders. So, they took the bond holders’ money. They were really just ordinary depositors that thought they were making a little interest. There was one man who committed suicide because he lost his whole 100,000 euros. He pinned a sign to his chest and blamed it on his bank. The effect of the bail-ins in Italy was, rather than stabilize the banks, it destabilized the banks. Depositors in Italy were pulling their money out. It seems to me that the way things are playing out, the banks will be kept in place by governments because of this fear of the collapse of this derivatives scheme. Who will be hurt? It will be the little people. So, we will see a crash, but it will be a crash on us. We will lose our deposits or we will have to do a bail-in. The big banks, under the current law, are pretty much safe.”
- George Soros Places Another Big Bearish Bet Against the S&P 500
According to his fund’s latest regulatory filing, billionaire investing legend George Soros has gotten very bearish on the S&P 500. As of June 30, Soros now owns put options on about 4 million shares of the S&P 500 index. That’s nearly double the number of SPX puts he owned at the end of March, which counted 2.1 million shares.
- Three “Red Flags” That The US Housing Slowdown Is Accelerating
One month ago, we showed three prominent “red flags” that the US housing market was starting to roll over. Among these were a report by real-estate advisory RealtyTrac, which cited by Bloomberg, said that “almost nine years after the housing-market bust helped trigger the most recent recession, RealtyTrac senior vice president Daren Blomquist sees the industry waving a red flag.” He was referring to house flipping by third party investors at auction which was back with a vengeance, and what’s worse, the share of foreclosures snapped up by inexperienced mom-and-pop buyers at auction had hit a record 31% in June. As he said, “this a redux of the same fervent speculation that pushed the housing bubble.”
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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 August 12, 2016 to August 18, 2016:
- The $6 Trillion Public Pension hole that We’re all Going to Have to Pay For
U.S. state and local employee pension plans are in trouble — and much of it is because of flaws in the actuarial science used to manage their finances. Making it worse, standard actuarial practice masks the true extent of the problem by ignoring the best financial science — which shows the plans are even more underfunded than taxpayers and plan beneficiaries have been told. The bad news is we are facing a gap of $6 trillion in benefits already earned and not yet paid for, several times more than the official tally.
- Thanks, Barry! Only 37% of Borrowers Are Actually Paying Down Their Student Loans
In her speech at the Democratic National Convention, Hillary Clinton exclaimed, “ Bernie Sanders and I will work together to make college tuition-free for the middle class and debt-free for all!” How she intends to do that remains something of a mystery, beyond higher taxes on “Wall Street, corporations, and the super-rich.” But it’s hard to imagine the student-loan industry and the burden of student debt getting any worse for taxpayers and borrowers than it is now. A largely overlooked report released in February by the Government Accountability Office suggests that the Obama administration’s policies have exacerbated student debt, which equals nearly a quarter of annual federal borrowing. With only 37% of borrowers actually paying down their loans, the federal student-loan program more closely resembles the payday-lending industry than a benevolent source of funds for college.
- Goldman Sachs, Morgan Stanley, JPMorgan, “Other Banks” Ask Fed to Let them Dodge the Volcker Rule till 2022
A decade after the first cracks of the Financial Crisis appeared – and six years since the Dodd-Frank law was enacted to prevent another Financial Crisis and to pave the way for resolving too-big-to-fail banks when they fail – Goldman Sachs, Morgan Stanley, JPMorgan, and “some other banks” are still trying to delay implementation of the new rules. These banks are asking the Fed to grant them an additional grace period of five years to comply with the so-called Volcker rule, “people familiar with the matter” told Reuters.
- Are We Close To Seeing Carnage Unfold?
With traders around the world awaiting today’s release of the FOMC Minutes, several warnings have just been issued. Gerald Celente: Global equity markets are spiking. Records are being broken… Why? Is it strong Gross Domestic Product increases among the world’s leading economies… the United States, China, Japan and eurozone nations that are driving the frenzy? Is it accelerating commerce that’s sending products and services far and wide across the globe that’s increasing corporate profitability — boosting trade, productivity and personal income that’s driving stock markets higher?
- US Tax Receipts Have Never Done This Without A Recession
US Federal Tax Receipts are rising at just 1.2% year-over-year (12-mo rolling), slowing drastically from its 13.4% YoY growth in June 2013. While “it's probably nothing,” we thought readers may be interested to note that the last six times tax receipt growth was at this weak a level, the American economy was in recession… So ignore US Tax receipts (hard data), ignore US productivity (hard data), ignore the bond market (hard data), and ignore GDP expectations… but pay attention to the non-farm payrolls headline data – because that's what you're told to do!!
- Negative Interest Rates: Bad Policy for European Central Bank
Several economists for the International Monetary Fund (IMF) recently expressed concerns about moving interest rates into negative territory. They believe it could backfire on the European Central Bank (ECB), making banks less profitable overall and reducing lending. The IMF promotes international monetary cooperation, facilitates trade, and fosters sustainable economic growth for its member countries. In a recent paper on the ECB’s monetary policy, two IMF economists, Andy Jobst and Huidan Lin, warned member banks of the monetary union were struggling to produce profits because of low-interest rates.
- US Industrial Production Slumps To Longest Non-Recessionary Contraction Is History
For the 11th month in a row, US Industrial Production fell YoY (down 0.53%) in July – the longest non-recessionary period of contraction in US history. Month-over-month, IP rose 0.7% (beating an 0.3% expected rise) – the best since Nov 2014 – but June was revised notably lower. Overall, all confirming the plunge in productivity seen last week. The decline since its peak in Nov 2014 (ironically the month after The Fed's QE3 ended) is the biggest drop since September 2008.
- REPORT: Paul Tudor Jones is slashing jobs at his iconic hedge fund
Billionaire Paul Tudor Jones is laying off about 15% of the staff at his legendary hedge fund, according to a Bloomberg report. The job cuts are a result of investment losses and investor redemptions from the $11 billion hedge fund, according to Bloomberg's Saijel Kishan. The affected staffers include investment managers and support staff, Bloomberg reported.
- Cisco Will Cut Up To 5,500 Jobs, 7% Of Staff, Less Than Some Reports
Cisco Systems (CSCO) said late Wednesday that it would cut up to 5,500 positions, or 7% of staff, as part of a restructuring networking giant reported better-than-expected fiscal fourth-quarter earnings. The cuts, which will begin this quarter, were less than the 9,000-14,000 staff reduction that CRN reported Tuesday was likely. Separately, TechCrunch reported, citing a source that Cisco was aiming for a 15% cost cut that includes layoffs.
- Withdrawals Plague Once-Mighty Hedge-Fund Firms Brevan Howard and Tudor
A growing exodus from hedge funds extended to two of the biggest names in the industry Tuesday, Tudor Investment Corp. and Brevan Howard, as disenchanted investors increasingly shun what was once the hottest place to put money. The funds’ problem is clear: They just aren’t performing. Hedge funds and actively managed mutual funds have been underperforming since financial markets began their rebound in early 2009. The average hedge fund is up 3% this year through the end of July, according to researcher HFR Inc., less than half the S&P 500’s rise, including dividends. Funds in the $2.9 trillion hedge-fund sector have now experienced three consecutive quarters of withdrawals for the first time since 2009, according to HFR.
- Target tumbles 6.4% as sales drop, outlook cut
Target said Wednesday that its second-quarter earnings fell 9.7% to $680 million and lowered its sales estimate for the rest of the year, citing “a difficult retail environment.” Shares of TGT fell 6.5% for the day, to $70.63. Adjusted earnings per share totaled $1.23, higher than the $1.13 predicted by analysts who were polled by S&P Global Capital Intelligence.
- U.S. mortgage demand to buy homes hits six-month low: MBA
Weekly applications for U.S. mortgages to buy homes slipped to a six-month low even as interest rates on fixed-rate home loans fell, according to data from an industry group released on Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of mortgage activity for home purchases, a leading indicator of housing sales, fell 4 percent in the week ended Aug. 12. It remained 10 percent higher than the comparable week a year earlier. The average rate on “conforming” 30-year home mortgages, or loans with balances of $417,000 or less, dipped to 3.64 percent last week from 3.65 percent, the Washington-based group said.
- Lowe’s earnings: $1.31 per share, vs. expected EPS of $1.42
Lowe's on Wednesday reported quarterly earnings and revenue that missed analysts' expectations, and lowered its full-year guidance. Shares of Lowe's fell 5 percent in premarket trading following the announcement. Share prices had been down 6 percent. (Get the latest quote here.) The retail home improvement company reported fiscal second-quarter earnings of $1.31 per share on $18.26 billion in revenue. Analysts had expected the retailer to report earnings of about $1.42 a share on $18.44 billion in revenue, according to a consensus estimate from Thomson Reuters.
- Global central banks dump U.S. debt at record pace
In the first six months of this year, foreign central banks sold a net $192 billion of U.S. Treasury bonds, more than double the pace in the same period last year, when they sold $83 billion. China, Japan, France, Brazil and Colombia led the pack of countries dumping U.S. debt. It's the largest selloff of U.S. debt since at least 1978, according to Treasury Department data. “Net selling of U.S. notes and bonds year to date thru June is historic,” says Peter Boockvar, chief market analyst at the Lindsey Group, an investing firm in Virginia.
- How the Global Warming Scare Began
A great scientist named Roger Revelle had Al Gore in his class at Harvard and the Global Warming campaign was born. Revelle tried to calm things down years later, but Gore said Revelle was Senile and refused to debate. John Coleman documents the entire story and shows how our tax dollars are perpetuating the Global Warming alarmist campaign even though temperatures have not risen in years and years.
- The Freest States For Off-Grid Living, Ranked 1-50
New Yorkers enjoy the least freedom in America, while New Hampshire citizens enjoy the most, according to a new report, Freedom in the 50 States, that examines the best states in which to live. The report by the Cato Institute examines everything from tax laws to gun laws to government regulation to education freedom and found that the five freest states are: New Hampshire, Alaska, Oklahoma, Indiana & South Dakota. The five states with the least freedom are: Maryland, New Jersey, Hawaii, California & New York.
- ALERT: Alasdair Mcleod Just Issued A Terrifying Warning
With continued uncertainty in global markets, Alasdair Mcleod Just Issued a terrifying warning. Fiddling While Rome Burns – Macleod’s Terrifying Warning. Alasdair Macleod: Technical analysts seem divided on where gold is going in the short-term. Some think it is consolidating before pushing higher to over $1,400, while others are calling for a steep fall into October, before gold resumes its bull market…
- With Global Gold Reserves Nearly Exhausted, Can Anyone Spell Weimar?
With global gold reserves nearly exhausted, can anyone spell Weimar? From The Guardian: “With global gold reserves nearly exhausted, and prices up by 360% in the past decade, this massive supply-and-demand imbalance has fuelled organised crime syndicates looking for new sources of revenue, researchers say, with the result that Peru and Colombia – the world’s top cocaine exporters – now earn more from illegal gold exports than cocaine exports.”
- Soros Hack Reveals Plot Behind Europe's Refugee Crisis; Media Manipulation; Cash For “Social Justice”
In the two days since the Soros Open Society Foundation hack by the DCLeaks collective, several notable revelations have emerged among the data dump of over 2,500 documents exposing the internal strategy of the organization, which expose some of Soros' tactics to influence and benefit from Europe's refugee crisis, the opportunistic funding and influence of media organizations, providing cash for assorted “pro-democracy” groups including the infamous La Raza, Soros' funding of various “social justice” organizations while paying to track unfavorable media coverage including that of Pamela Geller. One particular leaked memo, profiled earlier by the Daily Caller, argues that Europe’s refugee crisis should be accepted as a “new normal,” and that the refugee crisis means “new opportunities” for Soros’ organization to influence immigration policies on a global scale. OSF program officer Anna Crowley and program specialist Katin Rosin co-authored the May 12 memo, titled “Migration Governance and Enforcement Portfolio Review.”
- Silver is Kryptonite to Gold Cartel Bankers-Bill Murphy
Chairman of GATA (Gold Anti-Trust Action Committee) Bill Murphy thinks financial markets are way more vulnerable than they appear. Murphy explains, “There are negative interest rates and low interest rates that just keep staying down there, and supposedly things are really good. Look at our Dow at all-time highs, and yet something is really wrong. Of course, this fits into the GATA premise on this whole thing. There’s a lot of quantitative easing (money printing) and propping up of the markets, and it’s on very shaky ground. The plug could be pulled at any time. . . . With interest rates where they are and debt growing all over the place, the reasons to be in gold are off the charts.”
- Obama Wants A Third Term And This Is How He Could Make It Happen
Yes, we are all well aware the Constitution limits the Presidency to two consecutive four-year terms of office. Then again, if you weigh the track record of the Obama administration, the Constitution is nothing more than a challenge that he bypasses and circumvents with every given opportunity. Small wonder that he may very well do the same thing with the upcoming presidential elections. Already a sham, the presidential elections are actually a vehicle he can use to grab that “Third Term” for himself.
- America: You Will Go Insane Because Of What Your Eyes Will See
A cloud of madness is descending on America, and most of us are completely unprepared for the chaos that will be unleashed during the months ahead. This morning, I was reading through Deuteronomy when I came to a phrase that really resonated with me. In the Modern English Version, this is what Deuteronomy 28:34 says: “You will go insane because of what your eyes will see”. As I read that, it struck me that this is precisely what America is heading for. There are going to be people that have vast quantities of food and supplies stored up that are still going to blow their brains out when they see what happens to this country because they don’t have any hope. Without hope, I don’t know how anyone is going to make it through what is coming. If you think that the unrest and violence in Milwaukee are disturbing, just wait for a while, because much, much worse is on the way.
- This Has Been The Worst 12 Months For Floods In U.S. History
Since last October, the United States has been hit by “historic flood” after “historic flood”, and this latest flooding down in Louisiana that is making headlines all over the world has been caused by a “500 year storm“. Even before some areas of the state received more than 30 inches of rain, this was already the worst 12 months for floods in U.S. history, but without a doubt this has put an exclamation mark on this exceedingly unusual stretch of flooding. There are some rivers down in Louisiana that have crested three to four feet higher than their previous all-time records, and Governor Edwards is using the words “unprecedented” and “historic” to describe these floods. So far, 20,000 people have been rescued by authorities, and Governor Edwards even had to evacuate the Governor’s Mansion due to chest-high water in the basement.
- Violence Erupts In America’s Heartland As Milwaukee Becomes The Latest U.S. City To Burn
The city of Milwaukee, Wisconsin exploded in violence last night as the wave of chaos and civil unrest that is sweeping across America continues to intensify. At this point, many of our largest cities have become powder kegs of anger and frustration, and a full-blown riot can be set off with a single bullet. In this case, an armed suspect was shot and killed by Milwaukee police as he attempted to evade the police, and his death almost instantly set off pandemonium in the heart of the city. America is being ripped apart, and much more violence is coming. Decades of social decay and economic decline have fundamentally transformed many of our greatest cities, and tensions that have been simmering for a very long time are now being brought to a boil. Sadly, it seems quite likely that we will see even more rage, hatred and divisiveness in the months ahead.
- Rothschild's RIT Capital dumps sterling assets as it braces for the latest monetary ‘experiment'
Jacob Rothschild’s investment house RIT Capital Partners has dumped assets priced in pounds this year as it nervously awaits the results of “the greatest experiment in monetary policy in the history of the world”. RIT, which considered a merger with rival Alliance Trust in May before walking away, said it was being cautious in “uncharted waters” as government bonds sink into negative yields and central banks around the world ramp up economic stimulus programmes. “The six months under review have seen central bankers continuing what is surely the greatest experiment in monetary policy in the history of the world,” said Lord Rothschild.
- Why Doug Casey Thinks We Could See $5,000 Gold
One of the world’s biggest central banks just swung its “sledgehammer.” On Thursday, the Bank of England (BoE) launched its biggest stimulus package since the 2008–2009 financial crisis. It cut its key interest rate to a record low. It started “printing” money again. And it announced a new “funding scheme.” The BoE launched this massive easy money program to soften the blow of the “Brexit.” As you probably heard, Britain voted to leave the European Union (EU) on June 23. The historic event rattled Britain’s financial system.
- Another Major Warning Sign for Stocks
Not since 1999 did all three major U.S. stock market indexes – the Dow, the S&P 500, and the Nasdaq – hit record levels, as they did yesterday. Of course, 1999 proved to be the worst time to buy stocks in 30 years. After a few more months of lollygagging around, the Nasdaq crashed and the Dow and the S&P 500 sold off hard. Nasdaq investors didn’t get back to breakeven for another 15 years.
- The New Highs in US Share Market Are they the Prelude to a Crash?
Finally, the Dow made new highs in the face of constant calls for a crash. This past week, in a horse race we would call it a trifecta where the Dow Jones Industrials, S&P 500,and the NASDAQ all made new record highs. This sent a bunch of analysts to look again and began to proclaim that this was the first time that all three major indices have reached new highs on the same day since 1999. They then look at the charts and pronounce that the 1999 rally lasted only until 2000 and then crashed. Of course that was the DOT.COM Bubble and there was a massive wave of retail investor in the market back then compared to today.
- Secrets Of The Elite: Why Forbes’s Rich List Doesn’t Include The Wealthiest Families On The Planet
As Oxfam warns that global wealth inequality is spiraling out of control, we ask why the Rothschilds and Rockefellers are missing from the business magazine's definitive annual guide…with some startling revelations. “Permit me to issue and control the money of a nation, and I care not who makes its laws.“ This is a House of Rothschilds maxim, widely attributed to banking tycoon Mayer Amschel Rothschild in 1838 and said to be a founding principle for the highly corrupt banking and political system we have today. Along with the Rockefellers, the Rothschild dynasty is estimated to be worth well over a trillion dollars. How are these powerful families linked to the ongoing crisis of global wealth inequality, why are so many people unaware of their existence, and why doesn’t Forbes ever mention them in their annual list of the world’s wealthiest people?
- Under TPP, Corporations Will Replace Nations According to Leaked Document
An obscure Trans Pacific Partnership provision will serve to threaten the very existence of the nation state and replace governmental authority with the power and the whim of the corporation. This secretive provision promises to supplant all national authority with a “Rollerball” type of world. If you are not familiar, Rollerball was a very popular movie which debuted in 1975 and it depicted the planet as being ruled by six corporations in the place of national governments.
- Who owns the wind? We do, Wyoming says, and it's taxing those who use it
Not long after it became clear that the robust winds that blow down from the Rocky Mountains and across the sea of sagebrush here could produce plenty of profit in a world that wants more renewable energy, some of the more expansive minds in the Wyoming Legislature began entertaining a lofty question: Who owns all of that wind? They concluded, quickly and conveniently, that Wyoming did. Then, with great efficiency for a conservative state not traditionally tilted toward burdening the energy industry, they did something no other state has done, before or since: They taxed it.
- Farmland Bubble Bursts As Ag Credit Conditions Crumble
Aside from a brief pause during the “great recession” of 2009, Midwest farmland prices have been bubbling up for over a decade with annual price increases of 15%-30% in many years. Private Equity and low interest rates no doubt played a role in creating the farmland bubble as “excess cash on the sidelines” sought out investments in hard assets (see “Is TIAA-CREF Investing In Farmland A Harbinger Of The Next Asset Bubble?”). No matter the cause, data continues to indicate that the farmland bubble is bursting. 2Q 2016 agricultural updates from the Federal Reserve Banks of Chicago, Kansas City and St. Louis indicate continued income, credit and farmland price deterioration for Midwest farmers. Lender surveys also suggest that as many as 30% of Midwest farmers are having problems paying loan balances. Declining asset values and incomes have also caused banks to tighten lending standards which has only served to accelerate the decline.
- North American Life Insurers “Accidentally” Pile Up Massive Distressed Debt Holdings
Accommodative monetary policy by the Fed has crushed bond income for insurers. According to Bloomberg, 2015 investment income at North American insurers dropped below 2011 levels. Unsurprisingly, in their stretch for yield, insurers added to energy bond positions in 2015 to offset the funding gap. Now, the collapse of oil prices has apparently left North American life insurers in a bit of a pickle with distressed debt holdings having doubled in a matter of 6 months as IG energy bonds turned to junk.
- Russia Deploys S-400 Missile System To Crimea, As Tensions With Ukraine Soar
In the latest escalation between the Kremlin and Kiev, yesterday we reported that Ukraine had put its troops near the Russia border on combat alert, following an incident that according to Russia was an attempted terrorist attack. Recall that Russia’s secret service, the Federal Security Service, said on Wednesday that it had foiled “terrorist acts” prepared by Ukrainian military intelligence against infrastructure in the territory, with the aim of disrupting Russia’s parliamentary elections due on 18 September. Kiev denied the allegations. In response to the alleged operation, Putin said he was pulling out of international peace talks on the conflict in eastern Ukraine. He said he was no longer ready to meet his Ukrainian counterpart, Petro Poroshenko, and German and French leaders in the so-called Normandy format, which has been used for negotiations.
- Here It Comes—–Ukraine’s ‘October Surprise’
When a Russian FSB agent and a Russian soldier were killed by a team of Ukrainian saboteurs, and one of the captured Ukrainians was shown on Russian media in handcuffs, US ambassador to Ukraine Geoffrey Pyatt tweeted: “US government has seen nothing so far that corroborates Russians allegations of a ‘Crimea incursion’ & Ukraine has strongly refuted them.” Apparently two dead Russians don’t count for much in Pyatt’s book: perhaps Putin personally killed them, and the whole thing is a set up.
- Trump’s Tax Plan, Clinton Corruption and Mainstream Media Propaganda
Little change in the markets on Monday. We are in the middle of vacation season. Who wants to think too much about the stock market? Not us! Yesterday, Republican presidential candidate Donald Trump promised to reform the U.S. tax system. His proposals are nothing new – simplification, fewer brackets, eliminate loopholes for rich people. But he also targeted the “carried interest” exemption. “Carried interest” – or “carry” – is a term used in the financial industry to refer to what is essentially a performance bonus.
- Deutsche Bank ist Kaputt
It looks like Deutsche Bank is heading toward failure. Why might we be concerned? The problem is that Deutsche is too big to fail — more precisely, that the new Basel III bank resolution procedures now in place are unlikely to be adequate if it defaults. Let’s review recent developments. In June 2013 FDIC Vice ChairmanThomas M. Hoenig lambasted Deutsche in a Reuters interview. “Its horrible, I mean they’re horribly undercapitalized,” he said. They have no margin of error.” A little over a year later, it wasrevealed that the New York Fed had issued a stiff letter to Deutsche’s U.S. arm warning that the bank was suffering from a litany of problems that amounted to a “systemic breakdown” in its risk controls and reporting. Deutsche’s operational problems led it to fail the next CCAR — the Comprehensive Capital Analysis and Review aka the Fed’s stress tests – in March 2015.
- As Libor Blows Out To Fresh 6 Year Highs, A $28 Trillion Debt Question Emerges
Two weeks ago, when looking at the recent surge in short-term funding rates in general, and Libor in particular,we said that this is the result of a scramble by various funds to change their asset ahead of an October 14 deadline for money market reform. Recall that “On October 14, 2a-7 money fund reforms will require some prime money market mutual funds (those that invest in non-government issued assets) to float their net asset value (NAV) or, under certain circumstances, to impose redemption gates and liquidity fees on redemptions. Rather than face these regulatory constraints, many investors have started pulling assets from prime funds, and a number of prime funds have converted to government-only funds (which are exempt from these regulations). Since late-2015 alone, prime fund assets have declined by nearly $450 billion, reducing the supply of dollars that funded private sector short-term liabilities.”
- THE COMING BREAKDOWN OF U.S. & GLOBAL MARKETS EXPLAINED… What Most Analysts Miss
The U.S. and world are heading toward an accelerated breakdown of their economic and financial markets. Unfortunately, the overwhelming majority of analysts fail to understand the root cause of this impending calamity. This is also true for the majority of precious metals analysts. The reason for this upcoming systemic collapse of the U.S. and Global markets is quite simple when you understand the information and are able to CONNECT THE DOTS. While it has taken me years of research to be able to finally put it all together, new information really put it all into perspective.
- The Coming Global Silver Production Collapse & Skyrocketing Silver Value
The global economic and financial system is in much worse shape than I originally thought. New data and information suggest that the collapse will occur much quicker and with more dire results. This will cause global silver production to literally fall off a cliff within the next decade. Again, this is far worse than anything I imagined before. As I mentioned, new information and data point to a rapid “Thermodynamic collapse” of the U.S. and Global Energy Industries. According to Louis Arnoux, from his article, Some Reflections On The Twilight Of The Oil Age:”
- Negative Rates for the People—– German Bank Surrenders to Draghi’s NIRP
A small German bank just went negative on RETAIL bank deposit rates as opposed to corporate (business) deposit rates. IMF blog says ECB sub-zero rates work …. but for whom? Seniors, savers? European banks were clobbered during the global financial crisis and have never recovered. With the ECB throwing everything and the proverbial kitchen sink at the stagnant economies of Europe, THIS is the IMF’s definition of working for the lenders?
- David Rosenberg: “This Market Makes No Sense”
We are not sure what happened to the abnormally cheerful, permabullish, mutant variant of David Rosenberg who appeared so abruptly on the scene four years ago calling for higher yields and rising inflation (driven by wages of all things), but we are glad that the skeptical variation has once again taken control, because it is only the latter that was capable of writing such observant, unvarnished and non-sugarcoated pieces like the one posted this afternoon in the National Post, in which Rosenberg joins all other carbon-based traders in admitting that it is now “next to impossible” to make sense of this market.
- Funny Money Accounting—-Why Social Security Will Be Bankrupt In 10 Years
Here follows a deconstruction of Rosy Scenario. It underscores why the nation’s entitlement based consumption spending will hit the shoals in the decade ahead. In their most recent report, the so-called “trustees” of the social security system said that the trust fund’s near-term outlook had improved. So the stenographers of the financial press dutifully reported that the day of reckoning when the trust funds run dry has been put off another year—-until 2034. The message was essentially take a breath and kick the can. That’s five Presidential elections away! Except that is not what the report really says. On a cash basis, the OASDI (retirement and disability) funds spent $859 billion during 2014 but took in only $786 billion in tax revenues, thereby generating $73 billion in red ink.
- 13 Biggest Political And financial Distortions In The World
I think a lot about history. Thomas Carlyle, the Scottish philosopher, said, “The happiest hours of mankind are recorded on the blank pages of history.” It’s true. Remember studying US history in high school? You learned all about Woodrow Wilson and World War I. Then you learned about FDR and World War II, but you skipped over Harding/Coolidge/Hoover in between. What happened in the 1920s, anyway? Only the biggest economic boom in the history of the US, coupled with massive technological progress and improvements in standard of living. The best time ever. You might think people would want to study the conditions that led to that prosperity, so it can be repeated.
- The Planned Fracturing Of The EU This Jubilee Year Continues: Greece, Italy and Spain Consider Exiting
When we started The Dollar Vigilante in 2010 we stated that the worldwide central banking fiat money system would collapse within the decade. It was just math. Government debt continues to mount and the only way to pay interest on the debt is to print more money. The US government, alone, has doubled its debt in the last eight years, from under $9 trillion to now well over $19 trillion. Almost every Western government has done similarly and central banks continue to print money to make the dead system seem like it is still alive. Early in 2015 we caught on to an occult (hidden) timeline by which major financial events occur called the Shemitah, and the year after called the Jubilee (or Super Shemitah). On the end day of the once-every-seven-year Shemitah, in 2015, we wrote, “Eurozone Collapses, Borders Erected Across Europe On Shemitah End Day“.
- US Treasury Yields Go Negative Everywhere But Here
Negative interest rates are an existential threat for insurance companies, pension funds and other financial entities that need positive investment returns to survive. As rates on government bonds have gone negative in Europe and Japan, the above companies have been big buyers of US Treasury bonds, which still (for some reason) continue to offer positive yields. But according to a Bloomberg analysis published today, Treasuries’ positive yield has recently evaporated when the cost of hedging currency fluctuations is included.
- Nassim Taleb Warns The Biggest Black Swan Event Of All Is Coming
We are at an incredible moment in history. US stock markets are at nominal all-time highs. Government bonds are at or near all-time highs. Yet, central banks worldwide sit at 0% interest rates or less because things are too precarious to even raise rates a paltry 0.25% for fear of collapsing the entire system. In “traditional” economics this makes no sense. But we are far out of “traditional” now… we are in the extreme end-stages of a collapsing system. When that happens, nothing makes sense from a traditional/normal perspective. In the third quarter of 2015, during the end of the Shemitah year, world stock markets had their worst quarter since the last Shemitah year in 2008… and then they bounced back up. In January, world stock markets had their worst starting month to the year in history… and then they bounced back up. And, most recently, the day after Brexit, which was 7 days, 7 weeks, 7 months and 7 years since the Shemitah end day in 2008, world stock markets again had their worst day in history… and then bounced back up.
- Is The Gold Market Really Manipulated?
On the heels of gold’s biggest year-to-date surge in 36 years, a question arose: Is the gold market really manipulated? “The illusion of central bank control is in full force.” — Dylan Grice. Ronald-Peter Stoeferle, Incrementum AG Liechtenstein: Is The Gold Market Really Manipulated? There is a fine line between intervention (in most cases government, resp. political intervention) and manipulation (with the more negative connotation of “exertion of influence”). The fact that central banks intervene massively in bond markets (e.g. via quantitative easing) and currencies (e.g. the Swiss franc or the renminbi) and that prices are at times steered to the decimal, is officially known and considered legitimate. In many cases, the free price discovery process is therefore little but a myth…
- Pentagon’s Sloppy Bookkeeping Means $6.5 Trillion Can’t Pass an Audit
The Defense Department over the years has been notorious for its lax accounting practices. The Pentagon has never completed an audit of how they actually spend the trillions of dollars on wars, equipment, personnel, housing, healthcare and procurements. An increasingly impatient Congress has demanded that the Army achieve “audit readiness” for the first time by Sept. 30, 2017, so that lawmakers can get a better handle on military spending. But Pentagon watchdogs think that may be mission impossible, and for good reason.
- Memo To The Donald——–10 Great Deals To Save America
But there is a sliver of hope. If Donald Trump is elected, eschews a law and order crusade and does not capitulate to the destructive policies of the Wall Street/Washington/bicoastal establishment, there is a way forward. The political outlaw who considers himself to be the world’s greatest deal-maker would need to do just that. To wit, a President Trump determined to rid the nation of its mutant regime of Bubble Finance at home and failed interventionism abroad would need to make Ten Great Deals.
- How Long Can Economic Reality Be Ignored? — Paul Craig Roberts
Trump and Hitlery have come out with the obligatory “economic plans.” Neither them nor their advisors, have any idea about what really needs to be done, but this is of no concern to the media. The presstitutes operate according to “pay and say.” They say what they are paid to say and that is whatever serves the corporations and the government. This means that the presstitutes like Hitlery’s economic plan and do not like Trump’s. Yesterday I listened to the NPR presstitutes say how Trump pretends to be in favor of free trade but really is against it, because he is against all the free trade agreements such as NAFTA, the Trans-Pacific and Trans-Atlantic partnerships. The presstitutes don’t know that these are not trade agreements. NAFTA is a “give away American jobs” agreement, and the so-called partnerships give away the sovereignty of countries in order to award global corporations immunity from laws.
- *Breaking: China & BIS Negotiating Deal to Settle Global Contracts in GOLD at $5,000/oz! – Jim Willie
Chinese finance officials and the Basel-based BIS are NEGOTIATING A GLOBAL REFORM OF ALL BILATERAL CONTRACTS. They strive to alter US Dollar based contracts, and CHANGE THE CONTRACT TERMS TO GOLD SETTLEMENT. THE CHINESE & BIS ARE WORKING ON A GLOBAL CONTRACT AT THE $5000 GOLD PRICE… The big US banks are dead, as in giant hollow reeds. Such has been the Jackass refrain for eight straight years. They are insolvent monsters and destroyers of wealth and capital. They are massive criminal enterprises. Events prove the case well. The Too Big to Fail policy has instead assured the wreckage and destruction of the USEconomy. Save the big banks, but ruin the capital base. The USGovt under the management of the banker cartel since the 9/11 event, which they orchestrated in a bold move, has systematically brought down the macro business sector, permitted the USDollar platforms to decay completely, and rigged the financial markets in every conceivable arena. The central bankers are running scared.
- Japan to Lend Spy Vessels to Philippines as Tensions Rise in South China Sea
In a bid to stymie Chinese influence in the region, the Japanese government plans to deliver two patrol vessels to the Philippines, and provide surveillance aircraft. While Tokyo has its own dispute with Beijing over a series of islands in the East China Sea, it will also devote resources to the South China Sea, aiding Manila in its territorial dispute, by providing ships and aircraft. “We are talking about big-sized, 90-meter long vessels,” Masato Ohtaka, deputy foreign press secretary for Japan’s foreign ministry, told reporters.
- Self-Sufficiency Will Be The Only Way to Survive: “Nothing Will Have Any Value Except Food”
Here, Charles Hugh Smith argues that the scheme for world order will ultimately lead nowhere, because globalization is will leave everyone hanging. Instead, becoming self-sufficient and providing for food, energy and resources will be the lasting challenge – in the long run. While nations rise and fall, this will remain an important goal for the individual who can attain a certain degree of freedom by securing one’s own survival and needs for food and energy, and in turn providing an engine of wealth for anyone that they can trade or sell with.
- On The Brink Again: “Huge Housing Bailout Coming” As Fannie/Freddie Seek $126 Billion From Taxpayers
This could be the trigger event everyone has been waiting for; it certainly was in 2008. Like the conditioned animal, punished with a shock repeatedly, it produces more fear, and adrenaline and stress response during the build-up from the time the bell is rung and the shock is delivered. The actual shock is actually a relief, even though the animal fears the pain. It will all happen again, once the bell rings. Here, we know the crash is coming. The banks have orchestrated it, the Federal Reserve is setting the pace and preparing the bed in which we must all lie. A devastating blow to the economy is building up again. Which one will bring it all crashing down, and which will simply prove once again that we are held captive by a dangerous and failing economy that could soon wipe us all out? This could be 2008 all over again; on the other hand, it could be much worse. Either way, there is every sense that things are just getting started.
- What Do They Know That We Don’t? World’s Billionaires Are Stockpiling Cash: “Taking Money Off the Table”
When things risk going wrong, cash is king… and kings have cash. And with enormous fortunes being made – and destroyed – overnight. The world’s billionaires have shifted into stockpiling an average of 22% of their income in cash because they are terrified the economy could crash. Many of these people literally helped to build the system we all now rely upon, and now they are holding cash, gold and other assets our of fear that stocks will crash and digital instruments of wealth could be undermined, compromised or have their balance destroyed.
- Here’s how the government is stealing more than ever before
As you’re likely aware, Civil Asset Forfeiture is a legal process that allows the government to seize assets from private citizens without any due process or judicial oversight. People can be deprived of their private property without ever having been even charged with a crime, let alone never having actually committed one. The horror stories of its abuse are endless. People who have never done anything wrong have had their life’s savings, homes, and business assets confiscated without so much as a warrant. This constitutes theft, plain and simple. And like most government initiatives, it started small. Again, the statistics from 1986 show $93.7 million worth of cash and property was seized by the government. By 2014, that figure had grown 4,667% to a whopping $4.5 billion.
- Kenya Starts Pumping Oil
The Kenyan government said it has approved a plan for the production of between 2,000 and 4,000 barrels of crude daily. The plan includes an upgrade of road infrastructure to transport the crude to Kenya’s largest port in Mombasa, as well as the construction of a pipeline from the oilfields in northern Kenya to Lamu on the coast. This city is set to become Kenya’s main oil export terminal in the future. Kenya’s oil deposits are located in the northwestern part of the country, most notable among them the South Lokichar field, which is being explored by a joint venture between Tullow Oil, Maersk Oil, and local Africa Oil. Last month the three companies said they were going to restart drilling at the field in the last quarter of this year, planning four wells initially and later possibly expanding the number to eight. By the end of next year, South Lokichar should produce some 2,000 bpd of crude.
- Nigeria Set to Split if North Strikes Oil, says Nigerian President
Nigeria’s former minister of aviation, Femi Fani-Kayode, tweeted on Thursday that President Muhammadu Buhari planned to break up Nigeria if oil is found in the north of the country—the north, which the Niger Delta Avengers have claimed are for now, unjustly tapping into the oil wealth of southern Nigeria. Buhari has ordered the Nigerian National Petroleum Corporation (NNPC) to start drilling for oil in the northeastern part of Nigeria. In late July, the NNPC said in a statement that it was intensifying drilling in the Chad Basin and other parts of the Inland Sedimentary Basin in search of oil.
- For What It’s Worth: Chevron Will Sell Assets Totaling $5 Billion in Asia
According to the Wall Street Journal, the second biggest American oil company, Chevron, is to sell properties in Asia that are worth up to $5 billion. On Thursday, the Journal reported that Chevron will begin to sell offshore China assets this month. The California-based giant is hoping to make $10 billion from sales as part of their attempt to slash costs and adjust to cheaper oil prices. The report also stated that Chevron’s stake in an offshore oil field venture with CNOOC Ltd could raise up to $1 billion on its own. CNOOC Ltd is China’s state-owned oil company. Sources claim that this could be an attractive asset to both Chinese energy firms and sovereign funds.
- America Is ‘Tantalizingly Close’ To Energy Independence, Analysts Say
America will be “tantalizingly close” to being energy independent by the year 2020, according to analysts at the Raymond James (RJ) investment firm. America imported 65.3 percent of its oil in 2005, according to the RJ analysts, but the U.S. only imported 24.2 percent in 2015. RJ projects the U.S. will import just 11 percent of its daily oil needs by 2020, according to CNN Money. Future oil imports will be met almost entirely by Canada and Mexico.
- Did OPEC Just Issue A Warning For Oil Prices In 2017?
OPEC upgraded on Wednesday its 2016 projections for world oil demand growth to 1.22 million barrels a day (mb/d), up by 30,000 b/d from its previous estimate, but warned that there were “lingering concerns” that refiners in the U.S. and Europe may cut processing rates, which could decrease the demand for crude. In its Monthly Oil Market Report that came out on Wednesday, OPEC said that now its latest estimates peg the total oil demand at 94.26 mb/d. For 2017, global oil demand is expected to grow at the same level anticipated last month; that is, going up by 1.15 mb/d from 2016 levels. The total 2017 oil consumption is projected to hit a new record of 95.41 mb/d, OPEC noted.
- China, Russia must join hands to counter US in Asia: Chinese state media
Chinese state media on Friday urged Moscow and Beijing to join hands to offset the growing threat posed by the deployment of a US anti-missile defence system in South Korea and a possible deployment in Japan. “It is only a matter of time before Japan has THAAD on its soil,” an editorial in the Global Times warned. “Washington is ambitious to build a global anti-missile system so missile activities in China and Russia can be put under close surveillance, which will disable China and Russia’s strategic nuclear deterrence against the US,” it said. Beijing has said Washington’s decision last month to deploy a Terminal High Altitude Area Defense (THAAD) system would only worsen tensions on the Korean peninsula. Both Russian and Chinese Foreign Ministers Sergey Lavrov and Wang Yi have criticised the US move.
- Big Unwind Begins in San Francisco, Miami, New York, Houston: Rents in “Primary Markets” Sunk by Apartment & Condo Glut
This is how it is happening in Miami: A heroic building boom in Greater Downtown has created a phenomenal condo glut just when federal regulators decided earlier this year to track down money laundering in the real estate sector. It coincided with Brazil and Venezuela – Miami’s largest feeder markets – falling into political turmoil and economic chaos respectively. The “strong” dollar doesn’t help. And buyers from abroad have become scarce. No one was prepared for this. The slowdown started a year ago when the resale inventory began to balloon. According to a new report by Integra Realty Resources for the Miami Downtown Development Authority, in May listings soared 58% from two years ago, to about 3,000 units, while monthly sales plunged 43%. And new supply keeps on coming: In the second quarter, nearly 7,500 condos were under construction, with another 1,550 being marketed for sale.
- Profits Plunge, Sales Drop at Macy’s. Slashes Jobs, Closes Stores. Stock Jumps 18%
It’s been a tough quarter for Macy’s. Again. Sales dropped 4% to $5.87 billion in the second quarter, it reported today. It had already closed 41 “underperforming Macy’s stores” in its fiscal year 2015. So among the remaining company-owned stores, comparable sales fell 2.6%. Operating income plunged 73% to $117 million. Net income plummeted 95% to a nearly invisible $11 million, or 3 cents a share. The first quarter, on a year-over-year basis, was even worse. So for the first half, sales dropped 5.7%, operating income 53%, and net income 82%.
- Negative Rates for the People Arrive as German Bank Gives In
When the European Central Bank introduced a negative interest rate on lenders’ deposits two years ago, few thought things would ever go this far. This week, a German cooperative savings bank in the Bavarian village of Gmund am Tegernsee — population 5,767 — said it’ll start charging retail customers to hold their cash. From September, for savings in excess of 100,000 euros ($111,710), the community’s Raiffeisen bank will take back 0.4 percent. That’s a direct pass through of the current level of the ECB’s negative deposit rate.
- When Will the Record Corporate “Debt Binge” Collapse?
After a historic “debt binge,” leverage levels among the 2,200 largest US corporations, excluding financial institutions, have reached “record highs,” Standard and Poor’s warns. It blamed the Fed-fueled “excessive liquidity and low borrowing costs in the capital markets,” along with declining profits. Now these companies, and “particularly those at the lower end of the credit spectrum,” of which there are more and more, “are as vulnerable to downgrades and defaults as they were in the period leading up to the Great Recession – and perhaps more so.”
- Ron Paul Rages At The “Phony Job Recovery”
Last Friday saw the release of a bombshell jobs report, with headlines exclaiming that the US economy added over 250,000 jobs in July, far in excess of any forecasts. The reality was far more grim. Those “jobs” weren't actually created by businesses – they were created by the statisticians who compiled the numbers, through the process of “seasonal adjustment.” That's a bit of statistical magic that the government likes to pull out of its hat when the real data isn't very flattering. It's done with GDP, it's done with job numbers, and similar manipulation is done with government inflation figures to keep them lower than actual price increases. In reality there are a million fewer people with jobs this month than last month, but the magic of seasonal adjustment turns that into a gain of 255,000.
- China Furious, French Energy Giant Desperate, as UK Stalls $24bn Nuclear Deal
The UK government’s decision to postpone the signing of a controversial, tripartite $24-billion nuclear energy deal with state-owned companies from China and France could end up having serious ramifications not only for Britain’s relations with the world’s second largest economy, but also for the financial health of one of France’s biggest corporations. In an opinion piece in today’s Financial Times, China’s ambassador to the UK, Liu Xiaoming, said the Hinkley Point deal represents a “crucial historical junction” for relations between the U.K. and China, which has a one-third stake in the nuclear power station that was scheduled to be built by France’s majority state-owned energy giant EDF.
- European Close Sparks $5 Billion Selling-Panic In Gold Futures
Someonce decided to wait until Europe closed to dump $5 billion of notional gold into the markets (36k contracts)… makes perfect sense… 22,000 contracts in 10 minutes… 36,000 contracts… And Silver is following the same path…
- ALERT: BIS Intervenes In The Gold Market To Aid Battered Gold Shorts!
esterday King World News reported that a major swap dealer, who is heavily upside down on short positions in the gold market, is now in trouble. KWN then posed the following question: If the price of gold continues to surge, will some of the entities who are over-exposed short the gold market go insolvent? Or will the price of gold be brought down so the troubled shorts can regroup? And today, all the sudden… Well, some price capping in the gold market has been quite apparent in the last couple of trading sessions, but today it was reported that $5 billion of panicked paper gold futures selling occurred right after the physical market closed in London. But what really happened? Was it really panic or something else?
- Chesapeake Energy exits the Barnett Shale with a whimper
Chesapeake Energy, once the proud face of the shale gas drilling boom in North Texas, is transferring its 215,000 acres of natural gas assets in the Barnett Shale to a Dallas company backed by a global private equity firm. Chesapeake is not receiving any cash for the assets — which include about 2,800 operating wells — in turning it over to Saddle Barnett Resources LLC, a company backed by First Reserve, an equity and investment firm focused solely on energy assets, Chesapeake announced Wednesday. But by leaving the Barnett, which Chesapeake first entered in 2004 and where it became a major player, the company hopes to boost its operating income between $200 million and $300 million a year through 2019. And the company said it will eliminate about $1.9 billion of future midstream and downstream commitments.
- Return on UK government bonds turns negative
The return on some UK government debt turned negative after the Bank of England missed its target in a new bond buying operation. The Bank had offered to buy government bonds, or gilts, as part of its new quantitative easing (QE) programme to stimulate the economy. But the bank fell £52m short of its £1.17bn target when it failed to find enough sellers. That has driven up prices and pushed down the return or yield, to investors. As bond prices rise, yields fall, and vice versa. Buying government bonds is often considered a safe investment but they now offer a tiny, in some case negative, return. On Wednesday morning gilts maturing in 2019 and 2020 were yielding -0.1%.
- One simple reason why gold can still jump 50%
Heike Hoffman is a 54-year old fruit merchant in a small town in western Germany. She has no formal training in finance. She’s not running a multi-billion dollar portfolio. And yet, as the Wall Street Journal reported on Monday, “[w]hen Ms. Hoffman heard the ECB was knocking rates below zero in June 2014, she considered it ‘madness’ and promptly cut her spending, set aside more money, and bought gold.” She’s right. It is madness. There’s $13+ trillion worth of bonds in the world right now have negative yields, much of which is issued by bankrupt governments (like Japan). Stock markets around the world are at all-time highs even as corporate profits have been in long-term decline.
- Europe's Credit Investors Are Seeing Bubbles and Still Adding Risk
Credit investors are in a bind. Central banks have pushed bond yields to record lows, which has nudged investors into riskier securities in search of higher rates. Meanwhile, central bank stimulus has caused credit markets to rally, thus attracting inflows to the sector, meaning investors have more money to put to work amid ever-diminishing yields. That's the takeaway from a Bank of America Merrill Lynch's survey of 50 investors in European credit. Their biggest fear is that central banks are creating bubbles.
- El Salvador Downgraded by Moody’s as Government Debt Rises
El Salvador’s sovereign debt rating was downgraded to B1 from Ba3 by Moody’s Investors Service on Thursday and my be cut further as the government struggles to control a rising debt burden. The country’s debt-to-GDP-ratio will surpass 60 percent by the end of the year, Moody’s said, and economic growth of 2 percent means the government must “implement aggressive fiscal consolidation measures involving both revenues and expenditures” to stabilize debt levels.
- Hedge Funds Press Banco Popular for Puerto Rico Deposits
Hedge funds that own Puerto Rico bonds are putting pressure on Banco Popular over commonwealth funds deposited at the bank that they say should go to them. Lawyers representing the Ad Hoc Group of General-Obligation Bondholders sent a letter Thursday to Banco Popular de Puerto Rico in San Juan, notifying the bank of the group’s rights and remedies regarding government funds redirected to meet other obligations. The so-called clawback revenue should be used to help repay general-obligation debt because the island’s constitution says those securities must be repaid before other bills, the group said. The commonwealth defaulted on about $1 billion of principal and interest due July 1, including $780 million for general obligations, the largest payment failure in the $3.7 trillion municipal-bond market.
- World due for a serious crisis unlike anything we have seen in our lifetime
Jim Rogers speaks with Michael Covel on troubling trends of crime and violence around the world, Europe, US stocks and the upcoming serious crisis
- Chelsea Clinton: Now that Scalia’s Gone We Can Enact Gun Control
While campaigning for her mother recently, Chelsea Clinton admitted that the left is planning to use the Supreme Court to enact greater gun control if a Democrat wins the presidency this fall. Chelsea Clinton said Thursday at an event in Maryland that there is now an opportunity for gun control legislation to pass the Supreme Court since Justice Antonin Scalia passed away. “It matters to me that my mom also recognizes the role the Supreme Court has when it comes to gun control. With Justice Scalia on the bench, one of the few areas where the Court actually had an inconsistent record relates to gun control,” Clinton said. “Sometimes the Court upheld local and state gun control measures as being compliant with the Second Amendment and sometimes the Court struck them down.” Clinton then touted her mother’s record on gun control issues and knowledge that the Supreme Court has an effect on whether many gun control laws stand.
- ‘We should nationalise German banks' Warning Deutsche Bank teetering on edge of CRISIS
A TOP economist has warned that Germany's biggest bank is teetering on the edge of crisis and they only way to protect it against future shocks is to nationalise it. Martin Hellwig said stress tests carried out by the European Central Bank revealed the Deutsche Bank would be left in a precarious position in the event of another financial crisis. While it would probably not go bust in a fresh downturn – he predicted the bank which is crucial to the German economy would face serious equity problems. He said: “Putting it short: for a long and serious crisis there simply wouldn't be enough money.”
- This trend tells you everything you need to know about America’s future
Long ago in the Land of the Free, if you wanted to start a saloon, you rented a space and started serving booze. You didn’t have to go through years of petitioning a bunch of bureaucrats for permits and licenses. If you weren’t qualified or good enough at your job, your reputation would suffer and you’d go out of business. This is the way it used to be for just about every industry and profession. It wasn’t until 1889 that the US Supreme Court ruled in Dent v. West Virginia that states had the right to impose “reasonable” certifications or licenses for various professions. At first, most states only licensed physicians, dentists, and lawyers. In fact, by 1920, only about 30 occupations in the US required any sort of licensing. By the 1950s, about 5% of US workers required a license to perform his/her job. Today that number has risen to 30%, and climbing.
- China Expects Worst Ag Output Plunge in 50 Years and Food Inflation as Historic La Nina Arrives
The 2016 La Nina is set to be bigger than 1998 and that was one of the strongest ever. It was a bad hurricane season in the Southeast United States, and the effects of La Nina lasted for more than 2 years, eventually draining natural gas inventories due to colder than normal winters, sending prices to $10 / MMBtu. China is also concerned due to flooding and the effect on food prices.
- We Live in Dangerous Times—-Three Flashpoints For War
We are sitting atop a volcano that could erupt at any moment. Indeed, the only question is not whether it will explode, but when – and where. For this impending seismic event has multiple pathways to the surface, spread across no less than three continents. Europe, North Africa and Middle East.
- Soaring Debt Has U.S. Companies as Vulnerable to Default as 2008
U.S. companies have taken on so much debt that they’re at least as vulnerable to defaults and downgrades as they were leading up to the 2008 financial crisis, according to a report by S&P Global Ratings Tuesday. Corporate leverage in the U.S., excluding financial firms, is at the highest level in 10 years, driven by a combination of low interest rates and slowing profits, S&P analysts Jacob Crooks and David Tesher wrote. This has resulted in record leverage ratios across a universe of 2,200 companies, they wrote. Junk-rated firms are particularly at risk because the credit cycle may have peaked and future tightening in interest rates could shut the spigot on new borrowings right when the companies would want to refinance their debt. “With the level of leverage that we’re seeing, some of these more-peripheral stressed sectors are going to experience some challenges to obtain new financing as well as refinancing,” Tesher said in an interview. “It’s not a question of if, it’s a question of when.”
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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 August 5, 2016 to August 11, 2016:
- EXCLUSIVE: Gerald Celente – Sneak Peek At The Remarkable Top Trends For 2017 & How You Can Profit
Today the top trends forecaster in the world, Gerald Celente, spoke with King World News about a few of what will be the remarkable top trends for 2017 and how people can profit from them. Eric King: “Gerald, the top trends for 2017, let’s talk about something that is starting to surface (that is on your list of top trends for 2017) — virtual reality and what the opportunities will be there.” Gerald Celente: “It’s virtual reality, robotics and artificial intelligence. The Industrial Age is dead. This is now the Robotic Age — from industrialization to robotization and artificial intelligence. So it’s robotization, artificial intelligence and virtual reality. Let’s start with virtual reality…
- Back To Square One: Why The Financial System Needs To Reset
Epoch Times spoke to Paul about what is real money, why debt can never be repaid, and why he sees gold at $15,000 per ounce.
- The Last Time This Happened, US Equities Crashed
Something extremely unsusual just happened. The post-Brexit, post-QE collapse in UK Gilt yields has extended the ‘cheapness' of US Treasuries to over 100bps. This is the widest absolute spread since May 2000 but at almost 3x, this is by far the greatest relative differential in history. As gilt yields collapse so the absolute spread spikes, suggesting Treasuries are dramatically cheap…
- Marc Faber Issues A Stunning Warning That A Gigantic 50 Percent Stock Market Crash Could Be Coming
Are we about to witness one of the largest stock market crashes in U.S. history? Swiss investor Marc Faber is the publisher of the “Gloom, Boom & Doom Report”, and he has been a regular guest on CNBC for years. And even though U.S. stocks have been setting new record high after new record high in recent weeks, he is warning that a massive stock market crash is in our very near future. According to Faber, we could “easily” see the S&P 500 plunge all the way down to 1,100. As I sit here writing this article, the S&P 500 is sitting at 2,181.74, so that would be a drop of cataclysmic proportions.
- Entering Perfect Storm of Every Facet of our Lives-Bill Holter
Financial writer Bill Holter warns the world faces multiple problems, not just one. Holter explains, “We are entering a perfect storm of every facet of our lives. This is not just financial. This is social, and it has to do with the breakdown of the rule of law. In the U.S. and globally, you can look at this as a breakdown of morals. Society is breaking down. You’ve got false economic numbers supported by the press that’s telling the people that all is well. You are seeing, for lack of a better term, revolt all over the world. Brexit was a revolt. Donald Trump running for President is a revolt. You are seeing people get truly pissed off because they know something is wrong, and it’s a worldwide phenomenon.”
- China's Marshall Plan
China's ambition to revive an ancient trading route stretching from Asia to Europe could leave an economic legacy bigger than the Marshall Plan or the European Union's enlargement, according to a new analysis. Dubbed ‘One Belt, One Road,' the plan to build rail, highways and ports will embolden China's soft power status by spreading economic prosperity during a time of heightened political uncertainty in both the U.S. and EU, according to Stephen L. Jen, the chief executive officer at Eurizon SLJ Capital Ltd., who estimates a value of $1.4 trillion for the project.
- Bond Market’s Big Illusion Revealed as U.S. Yields Turn Negative
For Kaoru Sekiai, getting steady returns for his pension clients in Japan used to be simple: buy U.S. Treasuries. Compared with his low-risk options at home, like Japanese government bonds, Treasuries have long offered the highest yields around. And that’s been the case even after accounting for the cost to hedge against the dollar’s ups and downs — a common practice for institutions that invest internationally. It’s been a “no-brainer since forever,” said Sekiai, a money manager at Tokyo-based DIAM Co., which oversees about $166 billion.
- Trump is Right About Stocks
It is not often that you get investment advice from a presidential candidate. It is even rarer that you get good advice. But yesterday, Republican presidential candidate Donald Trump gave investors both good advice and good analysis. Bloomberg has the report: Donald Trump on Tuesday said interest rates set by the Federal Reserve are inflating the stock market and recommended 401(k)-holders to get out of equities, just like he did. “I did invest and I got out, and it was actually very good timing,” the Republican presidential nominee said in a phone interview with Fox Business. “But I’ve never been a big investor in the stock market.” “Interest rates are artificially low,” Trump said. “The only reason the stock market is where it is is because you get free money.” Mr. Trump is right on the money. The reason stocks are near their all-time highs is that there is a lot of free money around. Money lent out at interest rates below the rate of inflation is free.
- Trump Vows To “Jump Start” Economy With “Tax Revolution”; Is Interrupted At Least 14 Times
In his first comprehensive speech laying out his vision for the US economy, Donald Trump presented a tax-slashing agenda which would seek to cut regulations, while blaming Hillary Clinton for America’s economic woes in a highly touted address Monday at the Detroit Economic Club. “Americanism, not globalism, will be our new credo,” Trump declared, saying his plan represents the “biggest tax revolution” since the Reagan era. “I want to jump-start America,” the GOP presidential nominee added in another line that brought both applause and boos from the crowd.
- Investing in Gold in 2016: Global Paradigm Shifts in Politics and Markets
In the past few months, we have witnessed a series of defining events in modern political history, with Britain’s vote to exit the EU, (several) terror attacks in France and Germany, as well as the recent attempted military coup in Europe’s backyard, Turkey. Uncertainty over Europe’s political stability and the future of the EU keeps growing. These worries are quite valid, as geopolitical developments have the potential to shake markets to the core. The current high-risk environment makes it especially important to take prudent investment decisions in order to protect one’s wealth.
- US Economy – Something is not Right
This morning the punters in the casino were cheered up by yet another strong payrolls report, the second in a row. Leaving aside the fact that it will be revised out of all recognition when all is said and done, does it actually mean the economy is strong? As we usually point out at this juncture: apart from the problem that US labor force participation has collapsed (i.e., millions of unemployed people have been defined out of existence), employment is a lagging economic indicator. Nevertheless, payroll data and initial claims usually tend to give some advance warning ahead of recessions. As long as they remain strong, it is fair to conclude that a recession is probably still a few months away at a minimum. Note though that the warning signs from these indicators usually come very late in the game.
- Will Barack Obama Try To Stay In Office If Donald Trump Wins The Election?
If Donald Trump wins in November, will Barack Obama leave office and hand over power in an orderly fashion? Normally we would not even have to ask such a question, but these are not normal times. This week, Obama publicly stated that Trump “is unfit to serve as President” and that he is “woefully unprepared to do this job“. In addition, he told the press that Trump “doesn’t have the judgment, the temperament, the understanding to occupy the most powerful position in the world.” If Obama really believes those things are true, would he really just stand aside and hand the keys to the White House to Trump? Never before have I ever heard a sitting president claim that one of the major party candidates could not function as president. But that is what Obama has just done.
- Now The Markets Themselves Are Too Big To Fail
The First Rebuttal website has coined a term that gets to the heart of an increasingly dysfunctional system: The too-big-to-fail stock market. The general thesis is that most major countries are over-leveraged to that point of maybe being unable to survive a garden variety equities bear market – and are doing whatever it takes to keep that from happening.
- The Worst Global Crisis In History Will Be Triggered In The Next Few Months
With continued uncertainty in global markets, today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events, warned King World News that the worst global crisis in history will be triggered in the next few months. The Seeds Of The Worst Global Crisis In History. Egon von Greyerz: “This coming autumn, we are likely to see the beginning of the hyperinflationary phase of the sovereign debt crisis. Hyperinflation normally hits an economy very quickly and unexpectedly and is the result of the currency collapsing. Hyperinflation does not arise as a result of increasing demand for goods and services. The course of events in a hyperinflationary scenario can be summarized as follows: 1. Chronic government deficits; 2. Debt issuance and money printing escalating rapidly; 3. Bonds falling – interest rates rising fast; 4. Currency collapsing. The above process turns into a vicious circle that accelerates quickly…
- US Oil, Gas Industry Sees 26% Decline in Employment
US oil and gas producers have cut 142,000 jobs as of May 2016 since its peak employment levels in October 2014 of 538,000, according to a US Energy Information Administration press release on Friday—a 26% drop over that period. The 26% decline in oil and gas employment seems to mirror—although not as drastically—the oil and gas rig count, which stood at 404 rigs in May 2016—down a staggering 77% from the 1800 rigs in action in fall 2014.
- Why The Jobs Report Is Not Nearly As Strong As You Are Being Told
Happy days are here again? On Friday, the mainstream media was buzzing with the news that the U.S. economy had added 255,000 jobs during the month of July. But as you will see below, the U.S. economy did not add 255,000 jobs during the month of July. In fact, without an extremely generous “seasonal adjustment”, the number of jobs added during the month of July would not have even kept up with population growth. But the pretend number sounds so much better than the real number, and so the pretend number is what is being promoted for public consumption. Why doesn’t the government ever just tell us the plain facts? Unfortunately, we live at a time when “spin” is everything, and just about everyone in the mainstream media seemed quite pleased with the “good jobs report” on Friday.
- Bad Economy is Why Trump GOP Nominee-John Williams
Economist John Williams says don’t believe the hype about the U.S. economy being good—it’s not. Williams explains, “I love America, but we are in a deepening recession. The economy collapsed into 2009 . . . we never really recovered from that. We had a few bounces higher, but generally, we went into low level stagnation, and now it’s turning down again. We just had a revision to the benchmark GDP (1.2%) and the numbers are nonsense. The numbers are a lot weaker than they appear. There’s no question we are in a recession.”
- City of London Office Values Plunge 6% in One Month
In July, a sharp mechanism started working: one of the hottest commercial real estate markets in the world, and one of the most expensive, began to deflate. And the hiss is deafening. Capital values for offices in the City of London – the financial district of London – plunged 6.1% in July, from June, real estate firm CBRE reported today. In its monthly index, “capital value” represents the probable prices that would have been paid at the date of valuation. And it extended beyond London: In the UK office values dropped 4.1% from June. Commercial property values overall – including office, retail, industrial, and other – dropped 3.3%, which chopped year-over-year growth to 0.4%.
- Buffett Exits Entire Credit Default Swap Exposure, As Citi's Appetite For Derivative Destruction Surges
It was considered one of the bigger paradoxes for years. Back in 2003, Warren Buffett famously dubbed derivatives “financial weapons of mass destruction” and yet over the next several years went ahead and entered a number of the contracts, including both equities and credit, ostensibly by selling CDS to collect monthly premiums, although not to the same degree as AIG, which infamously had to be bailed out due to massive losses on its CDS book. The billionaire had argued that agreements he made were attractive because they gave him money up front that he could invest. Berkshire’s derivatives also differed from contracts that brought down other financial institutions during the 2008 credit crisis, because he had less onerous collateral requirements.
- “Poorer Than Your Parents?” New Study Shows 81% Of Americans Worse Off Than In 2005
The McKinsey study Poorer than Their Parents? offers a new perspective on income inequality over the period 2005-2014. Based on market income from wages and capital, the study shows 81% of US citizens are worse off now than a decade ago. In France the figure is 63%, Italy 97%, and Sweden 20%. The numbers for the US and France differ radically once transfer mechanisms like food stamps and Obamacare subsidies are taken into consideration.
- Weak Chinese Trade Data Confirms Global Slowdown, Imports Tumble
While central banks continue to “print” liquidity, now at a pace of nearly $200 billion per month, they are unable to print trade, perhaps the single best indicator of deteriorating global economic conditions. The latest confirmation came overnight from China, which reported more disappointing trade data for the month of July, as exports and especially imports fell more than expected in July in a rocky start to Q3, suggesting that China's measures have failed to generate a substantial rebound in the economy, and pointing to further and accelerating weakness in global demand, explaining the recent scramble by central banks to unleash even more monetary easing.
- “Sell Everything”… But Why: What Has The Smartest Investors So Spooked?
Many of the smartest investors out there hate stocks. Since May, we’ve heard negative equity calls from Stan Druckenmiller, George Soros, Carl Icahn, Jeff Gundlach and Bill Gross. Wall Street lore says “Never argue about markets with a guy who is much richer than you”. So we’ll take the discussion in a different direction: what do they know? Successful investors are always more plugged in than the market as a whole – hence their success. And while we can only guess at the lynchpins of their negative take on stocks, we do have some idea of how significant they must be. For example, in 2016 the S&P 500 is up 5.9% on a price basis after 1) the Brexit “Leave” vote, 2) dramatically disappointing Q1 and Q2 U.S. GDP, 3) a correction of 20% in oil prices, 4) a Fed that has incorrectly calibrated its public stance on monetary policy, 5) Donald Trump as the Republican candidate for president, and 6) the U.S. 10 Year Treasury at near record low yields.
- Voices from the Gasfields : It started with just ONE well
IMPORTANT! This is the film the UK & Australian Governments do NOT want you to see! Documenting the accounts of families living with the hydrocarbon industry as a neighbour, this hour long documentary is shocking, as it reveals the day to day pollution these people live with – pollution of water, air, light and sound, some of the the basic human requirements needed to survive. The blind eye that the authorities and the hydrocarbon industry turn to these families living conditions, and the complete disregard to the environmental damage done to the bush by this, is truly disgraceful.'…
- Will you hit the Frackpot? Theresa May's stunning cash payouts to families, with households offered up to £13,000 in the great shale bonanza
Families will be offered five-figure cash payouts under a radical plan to boost the drive for controversial shale gas fracking. The Lottery-style ‘Frackpot’ windfall scheme, to be unveiled by Theresa May tomorrow, involves paying individual householders cash sums – which could be as high as £13,000 – if they are living in areas where the gas can be extracted. The move marks a further dramatic departure by the new Prime Minister from David Cameron’s blueprint for Britain’s energy needs.
- Brexit Block: EU Official Says €25bn Debt Means UK Can’t Leave
Britain will have to pay the European Union a hefty sum if it is to follow through with Brexit, with claims that an estimated €25 billion is owed to the bloc in unpaid bills. An outstanding total of €200 billion (£170 billion, $221 billion) has been shifted around by the EU for years, under what Brussels’ mandarins call the “reste à liquider.” An unnamed senior EU official told German finance website WirtschaftsWoche the British slice of the debt would not be simply written off if Westminster invokes the much debated EU exit clause, Article 50. “A deal with Great Britain is unthinkable until the Brits settle this liability,” said the source.
- Bayer-Monsanto merger is ‘five-alarm threat’ to food and farms: Legal experts
A new legal opinion penned by two former Justice Department officials bolsters warnings that the proposed merger between agroindustrial giants Bayer and Monsanto “is a five-alarm threat to our food supply and to farmers around the world.”
- Society is Being Weaned off Cash
The central bankers could control everybody by simply eliminating cash and shutting off their atm & credit cards. This is exactly what they are planning. Within the next few decades, it is likely that there will be no more hard cash (coins/notes) left. By this point, the notion of using physical money will be a distant memory tinged with disbelief. “How did we ever manage something so clumsy and backward?” many will say. An increasing number of people are already saying similar things.
- How the World was Deceived about Global Warming and Climate Change
Current weather is normal; that is, it is well within the range of all previous weather and climate variations. There are no dramatic increases in temperature, precipitation, hurricanes, tornadoes, or any other severe weather. The climate is changing just as it always has and always will and the rate of change is perfectly normal. Of course, that is not what the government, environmentalists, or the media promote and as a result most of the public believe. The misconception is deliberate and central to the exploitation of global warming and climate change as the vehicle for a political agenda.
- There’s been a ‘serious and dangerous’ slowdown in productivity
When the US gross-domestic-product growth was released last Friday, the numbers were disappointing. The US economy grew at an annualized rate of just 1.2% in the second quarter, much weaker than expected. When combined with the results of the first quarter, the economy is growing at about a 1% annual rate,according to The Wall Street Journal — the worst first-half performance since 2011. Many economists think one of the big reasons for this weak expansion is a slowdown in total-factor productivity, a phenomenon that has been occurring in the US — and, to some extent, other developed countries — since 2004.
- The Outlook For Gold——Global Paradigm Shifts in Politics and Markets
In the past few months, we have witnessed a series of defining events in modern political history, with Britain’s vote to exit the EU, (several) terror attacks in France and Germany, as well as the recent attempted military coup in Europe’s backyard, Turkey. Uncertainty over Europe’s political stability and the future of the EU keeps growing. These worries are quite valid, as geopolitical developments have the potential to shake markets to the core. The current high-risk environment makes it especially important to take prudent investment decisions in order to protect one’s wealth.
- July Jobs Report: Trying To Find Meaning In The Meaningless
The BLS released yet another perfect payroll report for July. It hit on all the major themes, putting further distance to the shocking May number. All the right people have been reassured by all the right parts. “U.S. employment rose at a solid clip in July and wages rebounded after a surprise stall in the prior month, signs of an improving economy that opened the door wider to a Federal Reserve interest rate increase in September… “We view this report as easily clearing the hurdle needed to keep the Fed on track for a September rate hike. The bar for not moving now is much higher,” said Rob Martin, an economist at Barclays in New York.” Unfortunately for anyone who still thinks the Establishment Survey contains useful information, the quotes above were written in August 2015, not August 2016, about the July 2015, not July 2016, jobs figures. That happy sentiment last year at this time was derived from the initial estimate of +215k, less than the current July’s +255k. After revisions showed that, at least according to the BLS view of the trend-cycle world, the labor market last summer was supposedly much stronger than first thought, the Establishment Survey now registers an impressive +277k for July 2015.
- Met Life Profits Collapse, Payrolls To Be Slashed, Blames Fed
In a poetic poke to the eye of the Fed’s “lower for longer” interest rate policy intended to manage, in part, job creation,MetLife just announced a massive earnings miss and job cuts which the CEO attributed to lower investment income due to, you guessed it, low interest rates. According to MetLife’s 2Q 2016 earnings release, the company reported operating earnings of $924 million, down 48 percent from the second quarter of 2015, and 47 percent on a constant currency basis. Operating earnings in the Americas decreased 42 percent, and 41 percent on a constant currency basis. The stock is being punished in today’s trading session and is currently down roughly 9% (a mere $4BN of value destruction).
- The Warren Buffet Economy: How Central Bank Enabled Financialization Divided America
I am in the throes of finishing a book on the upheaval represented by the Trump candidacy and movement. It is an exploration of how 30 years of Bubble Finance policies at the Fed, feckless interventions abroad and mushrooming Big government and debt at home have brought America to its current ruinous condition. It also delves into the good and bad of the Trump campaign and platform and outlines a more consistent way forward based on free markets, fiscal rectitude, sound money, constitutional liberty, non-intervention abroad, minimalist government at home and decentralized political rule.
- Gerald Celente – Biggest Central Bank Gamble In History Fails As Gold Prepares To Skyrocket To $2,000
Today top trends forecaster Gerald Celente warned one of the biggest central bank gambles in world history failed as the gold market prepares to skyrocket to $2,000. Trend Alert: Central Banks Shooting Blanks. Gold Bull Run. Gerald Celente: After successfully boosting global equity markets with countless trillions of dollars, euro’s, yuan, yen, etc., but failing to raise incomes among the general population since the Panic of ’08, are central banks finally admitting their policies failed to induce true economic growth?…
- Rick Rule – I Have Only Seen The Stunning Event That Has Just Taken Place Twice In My Lifetime
With gold and silver on the move, today one of the wealthiest and most street-smart pros in the business spoke with King World News about a stunning event that has just taken place which he has only seen twice in his lifetime. Eric King: “Rick, the mining shares have been on a tear. Silver has also been strong and gold has been holding firm. But the mining shares, the XAU and the HUI, have hit new highs recently. There has been relentless buying of the high quality shares. Michael Belkin, who advises some of the top people on the planet, told King World News that there are many professionals buying the mining stocks and they don’t care that they missed the previous run-up because the stock prices and the market caps were too small before this advance and did not meet their mandates. Is that what is happening to some degree here as you are seeing institutional fund flows into the sector and it’s relentless?”
- Legendary Short Seller Says Ignore Today’s Takedown, Gold & Silver Bull Markets In Early Stages
Today a legendary short seller spoke with King World News about today’s takedown in the gold & silver markets. Eric King: “Bill, it’s a great day for people to hear from you because we have this hiccup in the mining shares, in gold and silver.” Bill Fleckenstein: “People cannot worry about what happens on any given day or any given week. The (mining) stocks have had a huge run, the metals have had a decent move, and they are going to be subject to days when they do poorly. And then sometimes they are going to go up a whole bunch on news you didn’t think was that big of a deal…
- Big European Banks Try to Block Contagion from Italian Banking Crisis (Before it Sinks them)
Europe has plenty of reasons to be worried these days, but none more so than the seemingly terminal decline of the old continent’s banking system. So fragile are Europe’s banks that they can’t even get through an ECB stress test — whose primary purpose is to restore confidence in Europe’s banking system, by ignoring two of the most insolvent national banking sectors (Greece and Portugal) as well as the main source of stress (negative interest rates) — without sparking a panicked sell-off.
- Whiff of Panic among Australia’s Biggest Banks?
Australian bank regulators that had for years practically encouraged the big four Australian banks to do whatever it takes to further inflate the housing bubble suddenly fretted publicly in April about the banks’ exposure not only to housing but also to China. And now something strange has happened that set off all kinds of warning sirens. On August 2, the Reserve Bank of Australia (RBA) lowered its target “cash rate” by 25 basis points to 1.50%. And what did the banks do? Something so strange it smelled of panic.
- China’s Property Bubble Echoes Subprime Crisis
The menacing fury of economic triggers that began piling up after the Great Recession are only getting larger and we can’t do much but watch it unfold and stay alert. I wrote about this in a letter late last year, but now here we are more than halfway through the year and it’s only getting worse. So much worse that the Chinese property bubble is now the catalyst that will reset markets – and will likely be one large event that cascades across the globe. I’m convinced that what finally puts an end to central banker madness and the incessant stream of QE will be the Chinese real estate bubble. Massive doesn’t even begin to describe the situation with China’s property market, but that’s somewhat expected with a population of 1.4 billion people.
- Junk Bond Issuance Collapses in the US and Europe
Standard and Poor’s default rate of US high-yield corporate bonds – the more appealing moniker for junk bonds – jumped to 4.5% in July, the worst since August 2010. But no problem. The S&P Distressed High-Yield Corporate Bond Index – comprised of 470 bond issues so troubled that they’re trading at a yield that is at least 10 percentage points higher than the Treasury yield – has rallied 48% since February 12. This includes the 2.5% swoon on Friday, when some of the hot air was let out.
- Dems and Media Panic Over Trump, Economy is Tanking, Iran No Deal, Deal Update
The mainstream media (MSM) and the Democrat Party would like you to think it is the Republicans in full panic mode, but it is their party that’s freaking out. The first tip comes from the MSM that is “going to war against Trump” and acting like the true political hacks they are. Journalism is dead at the MSM, and they are willing to destroy their businesses to stop the outsider. Negative stories trashing Trump are not having an effect as Trump is packing rallies by the thousands while voter turnout for Clinton rallies is lackluster. Meanwhile, major negative stories about Hillary Clinton are being ignored to try to combat her negative image as a liar. Hillary even lies about what the FBI called lies about her private servers, and the MSM ignores developments such as the IRS opening an investigation into the Clinton Foundation.
- Chemtrails are Greatest Threat to Life on Earth-Dane Wigington
Last month, CIA Director John Brennan admitted Chemtrails, or as he put it, “Stratospheric Aerosol Injection,” is established geoengineering science used to fight global warming. Geoengineering researcher Dane Wigington says if the government is admitting it, the negative effects of spraying are too big to hide much longer. Wigington explains, “When CIA Director Brennan has to address it publicly, clearly it’s getting very difficult for them to hide this elephant in the room and the damage it has done, not only to the environment, but to us. It is irreparable already, and they know the liability already. They know this. They also know the amount of liability that has been created. That’s why they have been so desperate to hide this. To put this into the nutshell, the amount of destruction these programs have caused environmentally, it’s contaminated the entire web of life. This is, mathematically speaking, the greatest and most immediate threat to the web of life on earth, including human health. It is greater than any other threat short of nuclear cataclysm. That’s a mathematical fact.”
- The U.S. Has Lost 195,000 Good Paying Energy Industry Jobs
Not all jobs are created equal. There is a world of difference between a $100,000 a year energy industry job and a $10 an hour job running a cash register at Wal-Mart. You can comfortably support a middle class family on $100,000 a year, but there is no way in the world that you can run a middle class household on a part-time job that pays just $10 an hour. The quality of our jobs matters, and if current long-term trends continue unabated, eventually we are not going to have much of a middle class left. At this point the middle class has already become a minority in America, and according to the Social Security Administration 51 percent of all American workers make less than $30,000 a year right now. We have a desperate need for more higher paying jobs, and that is why what is happening in the energy industry is so deeply alarming.
- The Economic Collapse In Venezuela Is So Bad That People Are Slaughtering And Eating Zoo Animals
If you were hungry enough, would you kill and eat zoo animals? To most of us such a notion sounds absolutely insane, but this is actually happening in Venezuela right now. This is a country where people are standing in lines for up to 12 hours hoping that there will be food to buy that day, and where rioting and looting have become commonplace. So even though the U.S. economy is in dreadful shape at this moment, we should be thankful for what we have, because at least we are not experiencing a full-blown economic collapse yet like Venezuela currently is. Black stallions can be some of the most beautiful horses on the entire planet, but things are so desperate down in Venezuela this summer that everything looks like food to some people at this point. What happened at the Caricuao Zoo on Sunday is so horrible that I actually debated whether or not to share it with you.
- The End Of A Trend: Oil Prices And Economic Growth
It used to be that when it came to the world economy, oil prices and economic growth were more like distant cousins who disliked each other rather than a happily married couple always seen nuzzling together in public. The received wisdom was that low oil prices are good for the overall economy even if they are bad for the oil industry and for countries that are heavily dependent on oil for their revenues. That's what many believed when suggesting that even though high oil prices and an attendant oil boom had underpinned economic recovery in the United States after the 2008 financial crash, low oil prices would now somehow on balance deliver even more recovery. And, low prices would also benefit the rest of the world as well.
- Since 2014 The US Has Added Half A Million Waiters & Bartenders And No Manufacturing Workers: Here's Why
As part of our monthly tradition showing the gaping disparity in the quality of the US labor market, we present the breakdown between the lowest paid jobs available, those for workers in “food services and drinking places”, also known as waiters and bartenders, and compare them to the number of workers in the traditionally best paid sector, manufacturing. Here is the bottom line: as the chart below shows, there have been half a million waiter and bartender jobs added since 2014, and no manufacturing jobs.
- 666: The Number Of Rate Cuts Since Lehman
BofA's Michael Hartnett points out something amusing, not to mention diabolical: following the rate cuts by the BoE & RBA this week, “global central banks have now cut rates 666 times since Lehman.” One would think this attempt by central banks to push everyone into risk assets, certainly the Swiss National Bank which as we showed yesterday has increased its US equity holdings by 50% in the first half of 2016 …
- Carl Icahn Has Never Been More Short The Market, Is Pressing For A Crash
Three months ago, when looking at the 10-Q of Carl Icahn's hedge fund vehicle, Icahn Enterprises, L.P. (IEP) we found something striking: Carl Icahn had put his money where his mouth was. Recall that over the past year, Carl Icahn had become one of the most vocal market bears with a series of increasingly escalating forecasts. At first, he was mostly pessimistic about junk bonds, saying last May that “what's even more dangerous than the actual stock market is the high yield market.” As the year progressed his pessimism become more acute and in December he said that the “meltdown in high yield is just beginning.” It culminated in February when he said on CNBC that a “day of reckoning is coming.”
- Bank of England could ‘absolutely cut rates again' this year
The Bank of England (BoE) could cut interest rates even further this year if it deems necessary to do so, the Bank's deputy governor, Ben Broadbent, said on Friday (5 August). On Thursday, as was widely expected, Britain's central bank cut interest rates to a historic low of 0.25% in response to worsening survey data following the country's decision to leave the European Union.
- Iran Is Cheating On The Nuclear Deal, Now What?
On July 14, 2015, Iran and the six world powers known as the P5+1 (China, France, Germany, Russia, the United Kingdom, and the United States) reached an agreement on Iran's nuclear program. The deal was intended to curb Iran's nuclear ambitions and put a hold on Tehran's nuclear development. President Obama promised that the deal is not based on trust rather anchored in verification. Nevertheless, the following revelations of confidential documents as well as the following breaches of the nuclear agreement by Iran, reveal otherwise. On paper, the nuclear agreement, the Joint Comprehensive Plan of Action (JCPOA), stipulates a series of regulations, monitoring mechanisms, and restrictions on Iran's nuclear activities. But how can the International Atomic Energy Agency (IAEA) maintain these transparency standards and follow through on the proposed regulations? How can the IAEA be sure to detect all illicit nuclear activities in the 18th largest country in the world?
- Hillary Says She Will “Raise Taxes On The Middle Class”, Crowd Cheers
Hillary Clinton can do no wrong in the eyes of her adoring fans. Not when she left four men to die; not even when she deleted classified information from her private server. The fact that Hillary has promised to put coal miners out of work makes her base more enthusiastic than anything. Here’s a crowd cheering for Clinton after she says she’ll ‘raise taxes on the middle class.’
- TD’s $300-billion man goes maximum gold as volatility mounts
In a world flush with central bank stimulus and swirling with volatility, Bruce Cooper is pushing for the one asset he says he can count on: gold. TD Asset Management’s chief investment officer is adopting a more conservative approach to focus on capital preservation. Cooper sees gold as the best bet with the global economy stuck in neutral, and as loose central bank policy, the U.K. Brexit vote, and a looming U.S. presidential election stoke demand for havens. The firm, which oversees more than $300 billion, shifted to “maximum overweight” in gold for its portfolios during the second quarter from a “modest overweight” according to Cooper’s latest market outlook report. The U.K.’s vote to leave the European Union is likely to lead to ongoing stress in Europe, Cooper said in an interview after appearing on Bloomberg TV Canada. “We turned more positive on gold at the beginning of the year and then we reinforced that in the second quarter.”
- Japan Proposes “Wage Controls” As Abenomics' Desperation Measure
One of the main reasons for the failure of Abenomics is that while Abe has been largely successful in boosting import prices as a result of the collapse in the Yen, his policies have been a failure when it comes to achieving the only thing that truly matters for achieving benign inflationary pressures: pushing wages higher. We first pointed this out all the way back in late 2014 in a post titled “The Abenomics Devastation: Japanese Real Wages Decline For Record 16 Consecutive Months.”
- The smart stick-on tattoo that can monitor your alcohol levels – and even call police if you're over the limit
A new smart stick on tattoo will be able to monitor exactly how much a person is drinking. The flexible patch can detect a person's blood-alcohol level from their sweat. It can even message doctors and even police if the wearer drinks too much.
- Regreening The Desert
For more than 15 years, cameraman and ecologist John D. Liu has conducted a worldwide, one-man mission: inspire the global community to reclaim deserts and restore biodiversity. It all started in 1995 when Liu began filming on the Loess Plateau in China. He watched as the local population worked to transform an area nearly the same size as the Netherlands from a dry, exhausted wasteland into a massive green oasis. Since that time Liu has traveled all over the world to convince and inspire government leaders, policy-makers, farmers, and others with his films and his knowledge. This program accompanies Liu on his mission in Jordan, where the royal family has invited him to help stop their country’s desertification. Scenes focusing on similar issues in Africa provide additional understanding of Liu’s efforts and his vision that a greener future is possible worldwide.
- The curse of cash
More alarming news on two fronts today. First, there is movement on the Japanese front. Bonds have sold off and something big may be in the offing. Then, an intellectual defence for the “phasing out” of cash has been published by an influential Harvard economist. It’s happening even faster than I thought. But first a correction from a note from yesterday. The note said that EU banking laws that went into effect on 1 January (the Bank Recovery and Resolution Directive, or BRRD) allows “bail-ins” on depositors with more than £100,000. Let me be absolutely clear about what that means. The Financial Services Compensation Scheme (FSCS) is the UK’s way of providing deposit insurance to British savers who have accounts with British financial institutions that have a banking licence. In the event of a banking crisis, the new EU banking law covers depositors up to €100,000 (not pounds).
- Venezuela In Chaos With Work Camps And 1,000% Inflation – Coming Soon To The West?
We’re keeping track of Venezuela and have written about its deepening disaster numerous times, including HERE. In fact, I personally visited a few months ago to see the disaster with my own eyes. Every time we look at this poor country, things are getting worse. The rate of price inflation is soaring toward 1,000 percent, with looting and shortages of critical necessities such as medicine and food. Hyperinflation is well underway. June monthly figures put inflation around 22%, with inflation at 488% for the year but I know from personal experience that the government numbers, as with all governments, are heavily lied about. Now comes a new disaster for Venezuela’s beleaguered citizens: Forced farm work to grow food that Venezuela lacks. That “effectively amounts to forced labor,” according to Amnesty International, which derided the decree.
- UK heading for new financial crisis ‘on grander scale than 2008' with Bank of England ‘asleep at the wheel', says ASI
The Bank of England’s annual stress tests of the UK’s banks, designed to ensure Britain’s lenders will not be at the heart of another destructive financial crisis, have been branded “worse than useless”, by a new report. Kevin Dowd, professor of finance and economics at Durham University, argues in a paper published today by the Adam Smith Institute that the Bank’s tests, which model various adverse economic scenarios each year such as a major fall in UK house prices or a Chinese property crash, have a series of “fatal flaws” and that the central bank is “asleep at the wheel”. “The purpose of the stress-testing programme should be to highlight the vulnerability of our banking system and the need to rebuild it. Instead, it has achieved the exact opposite, portraying a weak banking system as strong”.
- Cities – Food Free Zones? The Creation of the Urban Food Desert
Have you ever wondered why our modern cities are intentionally designed to be food-free? All living things normally live in close proximity to their food sources, it’s a biological fact and a common-sense survival strategy. We often take our surroundings for granted as we go about our busy lives, but if we stop for a moment and critically examine the state of our modern cities, we soon realise a disturbingly unnatural state of affairs – there is nothing edible growing in public spaces! This is rather worrying. What type of society in its right mind would want to compromise food security by intentionally removing all food growing activities from public spaces, and what would possess them to do such a thing? Why would anyone want to create food desert – an area where food is scarce and hard to obtain?
- Aetna Posts $300 Million Obamacare Loss, Warns May Exit Altogether
After every other major US health insurance provider already admitted to generating substantial losses on the Affordable Care Act, known as Obamcare, earlier today Aetna became the latest to report that its annual loss on Obamacare plans would be more than $300 million, and said it had scrapped plans to further expand its Obamacare business next year. More ominously, Aetna joined the biggest US health insurer UnitedHealth in reviewing how, if at all, it would continue providing ACA services in the 15 states it's currently in.
- CARNEY: Get ready for inflation, low growth, and unemployment
Bank of England governor Mark Carney has bad news: The Brexit vote has so weakened the UK economy that he is predicting a period of low growth, inflation above 2%, and increased unemployment. Alongside the Bank’s new rate cut, it revealed in its quarterly Inflation Report that it is downgrading the UK’s growth forecast for 2017 to just 0.8% from the previous estimate of 2.3%. That is the biggest single quarter-to-quarter downgrade in the Bank’s one-year forecast since it started producing the Inflation Report in 1992.
- The List Of Establishment Republicans That Say They Are Voting For Hillary Clinton Is Staggering
Who would have ever believed that so many big names in the Republican Party would publicly pledge to vote for Hillary Clinton in the 2016 election? All throughout the primaries and the caucuses, the Republican establishment expressed tremendous disdain for Donald Trump, but they were unable to derail his march to the nomination. Now that we have reached the general election, some of the biggest names in the GOP are actually taking the unprecedented step of crossing over to the other side and are publicly announcing their support for Hillary Clinton. This shows that many of these individuals were only “Republicans in name only” to begin with, and it also demonstrates the lengths that the elite are willing to go to in order to keep Donald Trump out of the White House.
- Central Bank Ignores President’s Plea, Lifts Colombia Rate
Colombia’s central bank ignored a last minute plea by President Juan Manuel Santos and raised the benchmark interest rate for an 11th consecutive month as surging food prices pushed inflation to the fastest since 2000. In a split decision, the seven-member board voted to raise the key rate a quarter-point to 7.75 percent, central bank Governor Jose Dario Uribe told reporters in Bogota after the meeting. The decision was forecast by 27 of 34 analysts surveyed by Bloomberg, while seven had predicted no change.
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Latest News From July 29, 2016 to August 4, 2016:
- The Stock Market Has Predicted The Outcome Of Presidential Elections With 86 Percent Accuracy
If you want Donald Trump to win the election, then you should be rooting for a stock market crash between now and November. As you will see below, if stocks go up during the last three months before an election, the incumbent party almost always keeps the White House. But if stocks go down during the last three months before an election, the incumbent party almost always loses. Earlier today, Trump warned Americans to get out of the stock market, and if his warning turns out to be correct it will likely benefit him politically as well. When the general population believes that things are going well, Americans tend to stick with current leadership, but when the general population believes that we have hit rocky times they are usually ready for a change.
- Are Those Safe Haven Assets Safe Anymore?
Michael Sonnenfeldt doesn't mince words: “There is no safety in safety,” the founder of Tiger 21, a network of “ultra-high-net-worth” investors, said. “All of the historical places you could get safe income from—dividend-paying stocks, bonds—they've all been bid up because of quantitative easing to the point where it's just trash.” Assets that include Treasury notes, high-quality dividend stocks, and low-volatility mutual funds have all seen spooked investors rush into their supposedly safe embrace. Sonnenfeldt and others argue that has transformed them. “When you overpay for what used to be safe assets,” he said, “they now have a lot of risk in them.” Whether they're “trash” is debatable. But the concern that the prices of these assets may now be propped up more by fear than by economic fundamentals is legitimate. Here's a look at how some “safe” assets that investors have raced into over the past year or so are holding up. For a backdrop, take a look at how the S&P 500 has performed since last August's deep dive.
- Donald Trump Warns Americans To Get Out Of The Stock Market As The Dow Falls For A 7th Day In A Row
One thing that you have to appreciate about Donald Trump is that unlike most politicians, he actually says what is on his mind. On Tuesday, Trump told Fox Business that he had already gotten out of the stock market, and that he foresees “very scary scenarios” ahead for investors. And of course things have already started to get a bit ominous for those holding stocks over the last week and a half. The Dow Jones Industrial Average has now closed down for seven days in a row, and that is the longest losing streak that we have seen since the panic of last August. Over the past 12 months we have seen virtually every other major global stock market experience at least one major crash. Could the U.S. markets be next?
- The new political divide
AS POLITICAL theatre, America’s party conventions have no parallel. Activists from right and left converge to choose their nominees and celebrate conservatism (Republicans) and progressivism (Democrats). But this year was different, and not just because Hillary Clinton became the first woman to be nominated for president by a major party. The conventions highlighted a new political faultline: not between left and right, but between open and closed (see article). Donald Trump, the Republican nominee, summed up one side of this divide with his usual pithiness. “Americanism, not globalism, will be our credo,” he declared. His anti-trade tirades were echoed by the Bernie Sanders wing of the Democratic Party.
- The Price Of Oil Is Crashing Again, And That Is Very, Very Bad News For The U.S. Economy
This wasn’t supposed to happen. The price of oil was supposed to start going back up, and this would have brought much needed relief to economically-depressed areas of North America that are heavily dependent on the energy industry. Instead, the price of oil is crashing again, and that is really bad news for a U.S. economy that is already mired in the worst “recovery” since 1949. On Monday, U.S. oil was down almost four percent, and for a brief time it actually fell below 40 dollars a barrel. Overall, the price of oil has fallen a staggering 21 percent since June 8th. In less than two months, the “oil rally” that so many were pinning their hopes on has been totally wiped out, and if the price of oil continues to stay this low it is going to have very seriously implications for our economy moving forward.
- Insuring Against a Market Selloff Just Keeps Getting Cheaper
In a world of overpriced assets there's one thing that keeps going on sale: volatility. The cost of protecting against a fall in the S&P 500 has dipped to a one-year low, according to equity derivatives strategists at Credit Suisse Group AG. It couldn't be better timing given that analysts at Goldman Sachs Group Inc. are sounding the alarm bell of a drop in stocks over the next three months, laying out a laundry list of investor worries, including stretched valuations, that could knock the recent rally.
- Painful To Watch: This Is The Weakest U.S. Economic ‘Recovery’ Since 1949
Most of us have never witnessed an economic “recovery” this bad. As you will see below, the average rate of economic growth since the last recession has been the lowest for any “recovery” in at least 67 years. And unfortunately, the economy appears to be slowing down even more here in 2016. On Friday, I talked about how the U.S. economy grew at a painfully slow rate of just 1.2 percent in the second quarter after only growing 0.8 percent during the first quarter. And last week we also learned that the homeownership rate in the United States has dropped to the lowest level ever. This is not what a recovery looks like. Instead, it very much appears that a new economic downturn has already begun.
- Foreign Appetite For U.S. Securities Has Taken a Drubbing
It wasn't supposed to be this way. When the Federal Reserve hiked benchmark rates in December, the initial jump in the short-end of the nominal U.S. yield curve raised expectations that foreign buyers would snap up the country's assets, thanks to their yield relative to those of other developed markets ravaged by low policy rates. In fact, net foreign flows to the U.S. have been decidedly weak this year, thanks to an exodus by foreign central banks and sovereign wealth funds, who've been dumping U.S. securities in order to raise cash to put to work at home. In May, official institutions abroad raced out of U.S. stocks and bonds with $26 billion of outflows. Private buyers abroad were, by contrast, net buyers of U.S. securities, but that wasn't enough to keep the total positive: foreign flows out of U.S. securities totaled $11 billion, according to the most recently available data in May, sharply reversing April's $80.4 billion of inflows.
- The Democratic Party No Longer Exists
The Democratic Party that once was concerned with workers’ rights, the elderly, civil rights, and the constitutional protections of America liberty no longer exists. As the just completed Democratic presidential primaries and the Democratic presidential convention have clearly demonstrated, the United States now has two Republican parties in service to the One Percent. The organized Democrats–the Democratic National Committee–have shown themselves to be even more venal and corrupt than the Republicans. Leaked emails document that the Democratic National Committee conspired with the Hillary campaign in order to steal the nomination from Bernie Sanders. It is clear that Sanders was the choice of Democratic Party voters for president, but the nomination was stolen from him by vote fraud and dirty tricks. The DNC and the media whores have tried to discredit the incriminating emails by alleging that the leaked emails resulted from a plot by Russia’s President Vladimir Putin in behalf of “Putin’s American agent,” Donald Trump. “A vote for Trump is a vote for Putin,” as the presstitute scum put it.
- Bank of England cuts interest rates to 0.25% amid biggest ever GDP downgrade in modern history
Interest rates have been slashed to a new historic low of 0.25 per cent and the Bank of England has pushed the button on another £170 billion of monetary stimulus to stop the economy sliding back into recession in the wake of the UK’s Brexit vote. Unveiling its most drastic set of GDP growth forecast downgrades in its modern history, the Bank said the UK economy will virtually grind to a halt in the wake of the Brexit vote – coming perilously close to another recession. The Bank’s forecasts include the positive impact of today’s stimulus package, implying the UK economy would otherwise have returned to recession this year for the first time since the 2008-2009 financial crisis. Instead, the Bank is now expecting quarterly GDP growth to slump to just 0.1 per cent in the third quarter of the year – and to eke out roughly the same meagre output in the final quarter.
- America is Doomed Without Restoring the Rule of Law-Karl Denninger
Trader and entrepreneur Karl Denninger has a dire warning. He basically says if there is lawlessness at the top of society, there will be lawlessness at the bottom. Denninger, who is so distraught he has suspended writing on his popular website, explains, “It is illegal for any entity with market power or anybody else to price fix. It is illegal to price commodities of like, mind and quantity in the market place. That is a federal law, and violations of these laws are not civil affairs, they’re felonies. . . . The only deterrents for corporations against bad behavior is people go to jail or the firm has its charter revoked because it runs out of money. The reason that is the case is as long as I can pay a fine and shift the cost onto the customers or shareholders or both, there is not deterrent—at all. . . . When does a CEO ever get indicted? When do members of the board ever get indicted? The answer is never.”
- Buy Gold… Some More
I spent the entirety of last week in one of my favorite cities in the world: Vancouver, British Columbia. This jewel of the Pacific Northwest has long been the heart of the world’s junior mining industry. It’s not that any mines are actually located here, but the city boasts more mining head offices than any other. So with the big gold and silver rally of the last few months, Vancouver is abuzz once again. High-end restaurants are packed, Bentleys are the ride of choice and real estate prices are going crazy. The occasion for my trip to Vancouver was the annual Sprott Natural Resource Symposium. I was invited to speak at the conference by my good friend and uber mining analyst Rick Rule. I spoke amongst the giants of the resources world: Bob Friedland, Ross Beaty, Rob McEwen, Doug Casey and, of course, Rick himself. This year’s event was a lovefest for gold and gold-mining stocks… bordering on a Woodstock experience!
- The Dollar Will Be Removed From Int’l Trade,Which Will Send Shock Waves Throughout The US: Jim Willie
Neocons, CIA and the “deep state” in the U.S.. NATO in Europe. Who else is being aggressive in our world towards other nations? Who else is continually poking Russia and China to provoke a war? What actions have Russia or China demonstrated that makes a thinking person say “Why are they being aggressive?” Not one time is this the case. The U.S. has a military budget that is more than double the rest of the world combined! Who is the real aggressor?
- The £1 trillion pension crisis facing 11m (and they're the lucky ones)
Pressure is mounting on the Government to oversee a root-and-branch overhaul of Britain’s company pension schemes in which more than 11 million workers have savings. It comes as these “final salary” schemes are registering their biggest ever funding shortfall, now at almost £1 trillion (£1,000bn). This sum is the gap between the investments these pension schemes own and the likely eventual cost of the pensions they have already promised to pay.
- President Obama Signed This GMO Labeling Bill
Soon all food packages sold in the U.S. will have to have the proper labeling. On Friday President Obama signed bill S. 764 that puts into place a federal standard for foods that have been made with genetically modified organisms, ABC News reports. This move comes just about two weeks after Congress passed legislation to necessitate labeling on all food packages that indicates whether or not they contain GMO ingredients. “This measure will provide new opportunities for consumers to have access to information about their food,” Katie Hill, White House spokesperson, told the news outlet. This didn’t win over all food-labeling advocates, however. One criticism is that the bill allowed companies to use QR codes or 1-800 numbers as a form of GMO labeling, forcing consumers to scan the code or make a call to get more information. That’s why some opponents are calling the bill the DARK Act, short for “Denying Americans the Right to Know,” and argue these alternative labels discriminate against low-income consumers who lack the technology to access off-label info. Others have criticized the bill because it isn’t as stringent as a piece of Vermont legislation that will now be superseded by the federal law. Vermont Senator Bernie Sanders was among the federal bill’s critics, and urged his Twitter followers to contact their senators about the bill earlier this month.
- BREXIT BOOST Britain’s economy growing twice the speed of Eurozone as 27 countries seek to cut a trade deal with UK
BRITAIN’S economy is growing at twice the speed of the ailing Eurozone, Brexit-boosting figures revealed yesterday. The UK’s national output increased by 0.6 per cent between April and June, while 19-country single currency bloc grew by just 0.3 per cent. Eurozone growth halved from the 0.6 per cent growth it saw in the first three months of the year as France’s economy flatlined. Overall the EU grew by only 0.4 per cent between April and June, Eurostat figures showed. MPs hailed it as further proof that the UK is right to cut ties with Brussels.
- A “Terrorist” Strike on the US which will make 9-11 look like a Summer Picnic: Why a Nuclear Attack on the US Mainland is Inevitable, and probably Imminent.
I wondered long and hard about how to pitch this post (actually, whether to even write it!). It’s not exactly going to make me a lot of friends. But, fortunately, I don’t give two shits about that. I’m pretty sure US citizens waking up to the likelihood of, and reasons for, this event, is just a bit more important. An atomic bomb destroying central Manhattan. Or Washington DC. Or Los Angeles. Or wherever. It only happens in the movies, right? It will make 9-11 pale into relative insignificance (except of course, for later historians, interested in the context of how the well-planned over-reaction to 9-11, almost certainly led to the nuclear attack!).
- Central Banks Will Create A Historical Gold Rush
The central banks are leading the world into a black hole and have no idea what a disaster they have created. What initially seemed like a nice money spinner for the private bankers in 1913 when the Fed was set up has resulted in a $2 quadrillion (at least) monster that is now totally out of control. Banks and central banks are experts at forging money. During the last hundred years, the Ponzi scheme seemed to work beautifully under the guise of Keynesianism. So whenever there was a problem in any economy in the world, all that was needed was some stimulus in the form of credit or forged money creation. And there are so many ways to forge money.Through the unlimited flexibility of the fractional banking system, money printing became the most perfect perpetual motion system whereby the more credit that was created the more credit and paper money could be issued by the banks. There is absolutely no limit to how much money could be printed. So banks and central banks have been in collusion to print or forge paper money which has no value and no asset banking. Any private individual doing the same would spend the rest of his days in jail. But when the bankers do it, it creates massive wealth and respectability for them since they have the full backing of governments. What a rotten world!
- 12 Times Pope Francis Has Openly Promoted A One World Religion Or A New World Order
On Sunday, Pope Francis told hundreds of thousands of young people gathered for World Youth Day in Poland that they need to “believe in a new humanity” and that they should refuse “to see borders as barriers”. Every two or three years, Catholics from all over the planet converge for one of these giant conferences, and as you will see below the Pope has not been shy about using historic occasions to promote his agenda. Unfortunately, it has become exceedingly clear that his agenda includes moving humanity toward a one world religion and a new world order. Of course Pope Francis is not going to use those exact phrases, but at this point it is very obvious what he is trying to do. If you don’t believe me now, perhaps you will see things differently after you have viewed the evidence that I have compiled in the rest of this article.
- Six Major Events That Will Change History
Investors globally have never faced risk of the magnitude that the we are now exposed to. But sadly very few are aware of the unprecedented risks the world is facing. For the ones who understand risk and take the right decisions, it will “lead to fortune”. Only very few will choose that route. Instead most investors will continue to live in the hope that current trends will go on forever but sadly these people will end up “in shallows and in miseries”. Risk is now staring us all right in our face but very few people can actually see it. 1. No Sovereign state will ever repay their debt, 2. No bank will ever give depositors their money back, 3. Stock markets will fall 90% or more, 4. Property markets will collapse, 5. Currencies will go to ZERO, 6. Geopolitical risk, terrorism and social unrest.
- EU death knell: Eurozone growth HALVES as French economy grinds to a halt
EUROPE's economic growth plunged by half in the second quarter of 2016, raising fears the outlook for the bloc is worsening. Across the eurozone, gross domestic product (GDP) increased by just 0.3 per cent, falling from 0.6 per cent in the previous quarter, figures from Eurostat showed. Unemployment was also revealed to be standing at a worrying 10.1 per cent last month. France shocked onlookers as its economy ground to a complete halt in the three months between between April and June. Household spending in the eurozone's second largest economy plunged in the second quarter.
- Revealed: the High Street names that used benefits claimants as free labour
The names of major companies who used a benefits scheme to employ people without paying them have been revealed after the government lost a four-year legal battle to protect their identities. Nando's, Tesco, Morrisons, Asda, WH Smith, Poundstretcher, Cash Converters, Boots, DHL and Superdrug were among more than 500 companies, councils and charities found to have been using the free labour of benefit claimants, who were forced to take unpaid work under rules brought in by David Cameron's Coalition government. The Court of Appeal has overturned the Department for Work and Pension's attempt to keep the names a secret at an estimated cost of tens of thousands of pounds in legal fees. Debbie Abrahams, Labour's shadow Secretary of State for Work and Pensions, said the scheme demonstrated the Conservative government's “skewed view of the world”.
- Global Deflation Alert: World Trade Growth Has Ground To A Halt
Falling rates of global trade growth have attracted much comment by analysts and officials, giving rise to a literature on the ‘global trade slowdown’ (Hoekman 2015, Constantinescu et al. 2016). The term ‘slowdown’ gives the impression of world trade losing momentum, but growing nonetheless. The sense of the global pie getting larger has the soothing implication that one nation’s export gains don’t come at the expense of another’s. But are we right to be so sanguine?
- Over Past 50 Years This Big Of Earnings Recession Has Always Triggered A Bear Market
It’s earnings season once again and it looks as if, as a group, corporate America still can’t find the end of its earnings decline since profits peaked over a year ago. What’s more analysts, renowned for their Pollyannish expectations, can’t seem to find it, either. So I thought it might be interesting to look at what the stock market has done in the past during earnings recessions comparable to the current one. And it’s pretty eye-opening. Over the past half-century, we have never seen a decline in earnings of this magnitude without at least a 20% fall in stock prices, a hurdle many use to define a bear market.
- Weekend Reading: Global Instability is Now the Fed’s Perma-Excuse
This week, the headlines have been dominated by the Democratic National Convention pushing Janet Yellen’s latest FOMC non-action to “page 6.” Of course, it was not surprising to hear yesterday Janet Yellen has once again “flip-flopped” on hiking rates. This tweet from HedgEye sums it up nicely.
- Here’s What Happens When the World Overdoses on Debt
Bonds are no longer assets. They’re liabilities. You might find this hard to believe. After all, most folks think of bonds as a safe way to grow their money. For decades, you could make a decent return of 5% or more in government- and investment-grade bonds without risking big losses. Not anymore. These days, most bonds pay next to nothing. Some have negative interest rates, which means owners must pay interest on the bond instead of earning interest. If you own a bond that pays a negative interest rate, you’re guaranteed to lose money if you hold the bond to maturity. And yet, folks are lining up to buy these bonds.
- Bo Polny Predicts Historic Crash By Jubilee End-Day, October 2
I recently interviewed Bo Polny of Gold2020 Forecast. Polny is famous for his numerical dissection of investments and markets and we discussed Shemitah market cycles, the timing of Brexit, 9/11 and the Jubilee end-date in early October among other issues. Polny is blunt about what is about to take place: A tremendous market crash of historical proportions that will leave most investors stunned and broke. He believes the time to get out of the stock market is growing short and that one ought to take profits and place them in gold and silver while it is still possible. Here at TDV, Senior Analyst Ed Bugos, like myself, has long anticipated such moves and as a result, the TDV portfolio is up 200% in the last year. Polny has predicted that the Dow will eventually move down to the 5,000 level and not recover – and he makes similar points in this interview. Silver, he has predicted, is going over $50 per ounce while gold is going over $2,000 per ounce in the near term. In fact, if gold doubles in price, then silver could quadruple. This Jubilee Year of 2016 is what Polny calls the “year of judgement.” He’s in agreement with us on this, of course. And in past interviews, he has pointed out conditions begin to mimic the chaos of 1764, especially in the US where 250 years ago, society suffered from poverty, hunger, social chaos and finally war.
- If Everything Is So Great, Then Why Do Two-Thirds Of Americans Say The Country Is On The Wrong Track?
Americans appear to be increasingly pessimistic about the future of America. According to a Real Clear Politics average of recent polls, 68.9 percent of Americans believe that the country is on the wrong track, and only 23.1 percent of Americans believe that we are headed in the right direction. But if you have been listening to the endless parade of political speeches at the Democratic and Republican National conventions, you would be tempted to think that the greatest days for the United States are right around the corner. The politicians keep promising us that better times are coming if we will just make the “correct” choices on election day, but no matter who we send to Washington D.C. things just seem to keep getting worse and worse. Let’s take a look at just a few of the signs that indicate that our country is going in the wrong direction…
- Brexit post-mortem
It is a month after Britain’s surprise vote to leave the EU. A new Conservative Prime Minister and Chancellor are in place, both David Cameron and George Osborne having fallen on their swords. The third man in the losing triumvirate, Mark Carney, is still in office. Having taken a political stance in the pre-referendum debate, there can be little doubt the post-referendum fall in sterling was considerably greater than if he had kept on the side-lines. This article takes to task the Treasury’s estimates of the effect of Brexit on the British economy and Mr Carney’s role in the affair, then assesses the actual consequences.
- A Bull Market For The Ages As The Price Of Gold Heads To A Jaw-Dropping $20,000
After such a significant move in the gold, silver and mining share markets, today King World News thought it was a good idea to take a step back and look at the big picture of the war between gold and the Federal Reserve. This led to a remarkable question: Is the price of gold headed to nearly $20,000? MacroTrends: The chart shows the ratio of the gold price to the St. Louis Adjusted Monetary Base back to 1918. The monetary base roughly matches the size of the Federal Reserve balance sheet, which indicates the level of new money creation required to prevent debt deflation. Previous gold bull markets ended when this ratio crossed over the 4.8 level.
- Deutsche Bank to close almost 200 branches, axe 3000 jobs
Germany’s largest lender is set to shut over a quarter of its branches across the country as the company goes through a major restructuring process. The closures are set to take place over the next few months, with 188 of Deutsche Bank’s 723 branches nationwide due to close their doors. On Sunday, Deutsche Bank published a list of the affected branches. North Rhine-Westphalia is to be hit hardest, with 51 branches in Germany’s most populous state listed for the chopping board. In Bavaria eleven will close, eight of which are in Munich.
- FMC Axes 1,000 Jobs, Prepares for Merger
The Houston-based energy equipment manufacturer, FMC Technologies, has slashed 1,000 jobs from its workforce as it preps to merge with Technip, a French firm. Due to dropping revenue in U.S. shale production, FMC’s profit during the second quarter sank to $2.2 million, or 1 cent for each share. This number is a major dip from the $108 million amassed during the same period in 2015.
- U.S. Economy Runs At Stall Speed For Third Straight Quarter
The U.S. economy expanded at a 1.2% annual rate in the second quarter, barely improving from Q1's downwardly revised 0.8% advance, the Commerce Department said Friday. Wall Street had expected a 2.6% pace. Consumer spending was very strong — up 4.2% — but housing and business investment declined, the latter for a third straight quarter. It's also the third straight quarter of anemic overall growth. In addition to Q2's 1.2% and Q1's revised 0.8%, Q4 2015 GDP growth was cut to 0.9%. On a per capita basis, the U.S. economy is essentially flat.
- Top Advisor To Sovereign Wealth Funds Says Gold & Silver Headed Into The Stratosphere Along With The Shares
With the gold and silver mining shares on a tear as the XAU and HUI Indexes hit new highs, today a top advisor to the most prominent sovereign wealth funds, hedge funds, and institutional funds in the world, told King World News that gold and silver are headed into the stratosphere along with the mining shares.
- Here’s the key factor pushing oil prices to $35 a barrel
After enjoying a stellar run-up, crude futures are headed south again, treading into bear-market territory. However, the fundamentals of supply and demand may not be the key reason behind the recent bout of weakness in crude futures. U.S. benchmark oil, West Texas Intermediate trading on the New York Mercantile Exchange CLU6, -0.12% has lost nearly 15% of its value so far in July, as of Thursday. Back on June 8, WTI had nearly doubled its value closing at a 2016 high of $51.23 a barrel after reaching a low of $26.21 on Feb. 11. On Friday, crude slipped more than 20% below its June peak, below $41 a barrel, officially pushing it into a fresh bear market—defined as a decline of at least 20% from a recent high. What a difference seven weeks can make!
- Is Bank of Japan signaling that it’s running out of ammo
The Bank of Japan on Friday disappointed investors by offering up a much smaller-than-expected round of additional stimulus while also announcing a review of its current policy measures, leading some observers to wonder whether policy makers fear they are running out of tools to stoke the Japanese economy. “The message the BOJ is sending is not so much ‘whatever it takes’ as ‘monetary policy’s pretty much played out,’” said Kit Juckes, global macro strategist at Société Générale, in a note. The Bank of Japan under Gov. Haruhiko Kuroda has been an aggressive buyers of bonds and equities. Its decision to implement negative rates earlier this year caught investors off-guard, but the move was seen backfiring as the Japanese yen failed to weaken. The market’s reaction to those earlier moves began to prompt concern that aggressive easing efforts by global central banks were losing their effectiveness or potentially becoming counterproductive.
- Get ready for America’s new $29 trillion debt
Only when a crisis erupts does the society demand action. And of course, at that point, it’s too late. Such was the case of France in the late 1700s– a situation so desperate that the finance minister resorted to all-out lies in order to conceal their true condition. Most of the West is in this position today– summed up by Jean-Claude Junker’s (former President of the European Council) explanation of the Greek debt crisis in 2011: “When it gets serious, you have to lie.” Over in the United States, the Congressional Budget Office (CBO) recently published its own projections for America’s grim public finances. Bear in mind that US debt is already $19+ trillion and climbing. The CBO sees at least another $10 trillion in debt in the coming years, and projects that the US budget deficit will increase every single year. The evidence is already so clear. Military retirement spending rose by 8.7% last year. Medicare costs were up 10%. Certain government employee benefit programs rose by 17%. Overall mandatory outlays rose on average by 6.6%, three times faster than US GDP. So essentially the US government’s spending growth is far outpacing US economic growth. It doesn’t take a rocket scientist to see how dangerous this is.
- Peter Schiff: Expect An Economic Crisis Infinitely Worse Than 2008
Want to understand why people MUST begin to prepare for the worst economic crash in global history. Here it is as plainly as it can be put, with tons of supporting links at the bottom. In the following video, AMTV interviews Peter Schiff after yesterday's Fed meeting, and as an enormous fan of Peter’s for over a decade, as well as a client of his, I can’t help but laugh when only :18 into the interview Peter gives his first eye roll. Frankly, I don’t know how the man keeps his eyes in their sockets without them rolling right out. He’s always swimming upstream against the mainstream media outlets, and it has to be tiring.
- Hillary Won’t Win Presidency, DNC and Clinton Exposed for Rigging Democratic Primary, Economic Update and Global War Heating Up
It’s now been totally exposed the Democratic National Committee (DNC) rigged the primary in favor of Hillary Clinton. This is a turning point that says no way Clinton can be elected without nearly half the Democrat voters that supported Bernie Sanders. A WikiLeaks email dump at the beginning of the Democratic National Convention in Philadelphia showed clear evidence the DNC committed fraud and collusion against all candidates and rigged the Primary in favor of Hillary Clinton. Outraged and disenfranchised Sanders voters are protesting by the thousands, and yet, the mainstream media, by and large, will not cover the protests taking place outside the DNC convention. These are mostly young people who voted or worked diligently for the Sander’s campaign. Greg Hunter says Clinton will get only a small percentage of Sander’s voters, and the rest will vote for Donald Trump, another candidate or simply say home. Hillary is toast and will not become the President of the United States.
- Central Bankers are Driving Us All Into the Dirt – The Great Unwind has started.
One of the major triggers I’ve been warning about is already happening, even before we understand and/or admit that we are in a recession. Global corporate debt now sits at a record $51 trillion and is poised to hit $75 trillion by 2020 – just four years away. If interest rates rise and the economy slows, it will be very hard for companies to roll these bonds over – and then we get what S&P Global Ratings is calling “Crexit.” The bond markets dry up for corporate lending, especially higher-yield junk bonds. This would set off a chain of corporate defaults and bankruptcies that would cause central banks to start to lose control of the economy, as they did in 2008 forward.
- Another Retailer Leveraged Buyout Bites the Dust
Claire Stores – “the latest trends in jewelry & accessories for girls, teens, & tweens” with “must-have hair accessories, stylish beauty products, & more” as it says – has decided to start twisting the arms of its creditors, and has hired law firm Morgan, Lewis & Bockius to help in those endeavors, “sources” told Reuters. Creditors can see the big gun pointed at their heads: if they don’t agree to a debt restructuring deal entailing a big haircut for them, the company will file for bankruptcy, which might entail an even bigger haircut. To cut costs, the company already shuttered 150 stores over the past four quarters, and is now down to 2,831 stores in the US and Europe, as per its earnings report for the quarter ended April 30. Revenues dropped 6.4% to $300 million, generating a net loss of $38.8 million. It’s buckling under $2.35 billion in long-term debt. Interest expense amounted to $55.1 million, or 18.3% of revenues! As so often in these basket cases, there’s a private equity angle to it.
- The American Dream Plunges to Record Low – Consequence of turning “home” into a financialized “asset class.”
Something happened on the way when the concept of “home” transmogrified to a financialized “asset class” whose price the government, the Fed, and the industry conspire to inflate into the blue sky, no matter what the consequences. And here are the consequences. The Census Bureau, which has been tracking homeownership rates in its data series going back to 1965 on a non-seasonally adjusted basis, just reported that in the second quarter 2016, the homeownership rate dropped to 62.9%, the lowest point on record. It matches the low point in Q1 and Q2 of 1965 when the data series began. At no time in between did it ever fall this low. And it was down half a percentage point from 63.4% a year ago.
- US Government Mucks up Money-Laundering in Real Estate, Puts Luxury Housing Bubbles at Risk
Manhattan and Miami already get mauled. Now expanding to San Francisco, Silicon Valley, Southern California, even Texas! Cash sales of homes – mostly the domain of foreign and affluent buyers – fell to 32% of total home sales in April, down 2.8 percentage points from a year ago, according to a new report from CoreLogic. For the first four months, cash sales dropped to 34%, the lowest since 2008. In Florida, the number one destination for foreign homebuyers, cash sales accounted for 46% of sales, and in New York, for 44%, both decreasing as well. The “strong dollar” and “global uncertainty” were blamed. In Manhattan and Miami, the luxury condo markets are already getting mauled. For example, we reported that in Manhattan, condo prices plunged 14% in just three months.
- Bye Bye Middle Class: The Rate Of Homeownership In The United States Has Hit The Lowest Level Ever
The percentage of Americans that own a home has fallen to the lowest level ever recorded. During the second quarter of 2016, the non-seasonally adjusted homeownership rate fell to just 62.9 percent, which was exactly where it was at when the U.S. Census began publishing this measurement back in 1965. This is not what a “recovery” looks like. All throughout the Obama years, the percentage of Americans that own a home has gotten smaller and smaller and smaller. The reason for this, of course, is that the middle class in America is dying. Last year, we learned that middle class Americans now make up a minority of the population for the first time ever. In order to have a high rate of homeownership, you need a thriving middle class, and you can’t have a thriving middle class without good paying middle class jobs. This is why I write about the evisceration of the middle class so extensively, because the U.S. economy is systematically being hollowed out and most Americans don’t understand what is happening.
- ExxonMobil Tumbles To 2-Month Lows After Earnings Miss Worst Analyst Expectation
But, but, but the dividend yield, the oil recovery? ExxonMobil is down almost 3% in the pre-market to 2-month lows as it misses earnings expectations drastically (+41c vs 64c exp.. below the lowest expectation of +55c). Production levels also missed expectations as it appears the oil glut has trickled down to motor fuels, dragging refinery margins notably lower.
- Why Social Fragmentation Suits The Powers That Be
The Elites have successfully revolted against the political and economic constraints on their wealth and power. Ours is an Age of Fracture (the 2011 book by Daniel Rodgers) in which “earlier notions of history and society that stressed solidity, collective institutions, and social circumstances gave way to a more individualized human nature that emphasized choice, agency, performance, and desire.” A society that is fragmenting into cultural groups that are themselves fracturing into smaller units of temporary and highly contingent solidarity is ideal for Elites bent on maintaining political and financial control. A society that has fragmented into a media-fed cultural war of hot-button identity-gender-religious politics is a society that is incapable of resisting concentrations of power and wealth in the hands of the few at the expense of the many.
- Oil Surges After OPEC Production Hits Record High: Here's Why
Now that the narrative of rising gasoline demand and a “strong summer driving season” is finally over, courtesy of gasoline stocks that just refuse to drop and a glut in PADD1 that has never been greater defenders of the “bull” crude oil thesis are stumped. “Doubts are rife as to whether the oil supply imbalance is indeed slowly drawing to an end,” Stephen Brennock of oil brokerage PVM, said. So with no fallback “story” both WTI and Brent are down 20% since their last peak in June, as another bear market for oil has arrived.
- Peter Schiff Slams The Fed's ‘Loud Talk, No Stick' Policy
Theodore Roosevelt’s famous mantra “speak softly and carry a big stick” suggested that the United States should seek to avoid creating controversies and expectations through loose or rash pronouncements, but be prepared to act decisively, with the most powerful weaponry, when the time came. More than a century later, the Federal Reserve has stood Teddy’s maxim on its head. As far as Janet Yellen and her colleagues at the Fed are concerned, the Fed should speak as loudly, frequently, and as circularly as possible to conceal that they are holding no stick whatsoever. Roosevelt's “stick” was America’s military might, which in his day largely boiled down to the U.S. Navy, which he had enlarged and modernized. To demonstrate to a potential adversary that he was prepared to use these weapons, Roosevelt sent the fleet around the world in a massive show of force. However, he took care to couch the expedition in soothing rhetoric. He even ordered the battleships to be painted white to create the impression that they were angels of mercy rather than instruments of power. The combination proved effective. America’s global influence increased dramatically during his presidency even though few shots were fired.
- Trump Unloads On Hillary Speech Attacking His “Dark” Vision For America
In her climactic, nomination acceptance speech concluding the Democratic National Convention, as expected Hillary Clinton delivered remarks (which according to some were upstaged by previous speeches by Michelle Obama and the president) that focused on themes of “optimism” and “unity”, while ripping her challenger, Donald Trump, and emphasizing his “dark” vision of America. Much of Clinton’s address focused on the choice voters face between the former secretary of State and Trump, who Clinton said threatened to take the country from “morning in America to midnight in America.” “Bonds of trust and respect are fraying,” she said. “We have to decide whether we will all work together so we can all rise together.”
- The Fed Is Preparing For Negative Rates – Here's The Sign Everyone Missed
I think it’s possible that the Fed will push rates below zero when the next recession arrives. In that regard, something important happened recently. And not many people noticed. I’ll do a quick review to explain. In Congressional testimony last February, a member of Congress asked Janet Yellen if the Fed had legal authority to use negative interest rates. Her answer was this: “In the spirit of prudent planning we always try to look at what options we would have available to us, either if we needed to tighten policy more rapidly than we expect or the opposite. So we would take a look at [negative rates]. The legal issues I'm not prepared to tell you have been thoroughly examined at this point. I am not aware of anything that would prevent [the Fed from taking interest rates into negative territory]. But I am saying we have not fully investigated the legal issues.” So as of then, Yellen had no firm answer either way. A few weeks later, she sent a letter to Rep. Brad Sherman (D-CA). He had asked what the Fed intended to do in the next recession and whether it had authority to implement negative rates.
- Why the EU stress test is a farce and the Eurozone is set to IMPLODE, writes Paolo Barnard
“A horse! a horse! my kingdom for a horse!”. After the results of the European banks’ stress test I want to cry: “A Brexit passport! a Brexit passport! My house for a Brexit passport!” And I’m not joking. The much expected results of the 2016 EBA’s stress test of the main EU lenders is a farce, and it’s not funny, because the lives of millions could be jeopardised by it. The desperate EU regulators rigged the test to the point of ridicule: first it did not examine lenders from Greece or Portugal, where banks’ balance sheets are akin to a warzone. Second, the test lacked a pass/fail mark. Then EU regulators pretended that the catastrophic NIRP factor (negative interest rates set mainly by the ECB) didn’t exist.
- Monte Paschi Fails European “Stress Test” Meant To Restore Confidence In Europe's Struggling Banks
Moments ago, the European Banking Authority published the 2016 bank stress test results, whose purpose – as every other year – is to inspire confidence in Europe's struggling banks; it differs from a market-based assessment of bank stress – that particular “test” can be seen by observing the stock prices of such giant banks as Deutsche Bank and Credit Suisse, both of which recently hit all time lows. As previewed yesterday, Italy's 3rd largest, and most insolvent bank, Banca Monte di Siena was the worst performer in European regulators’ stress tests, and the only lender to have its capital wiped out in the exam. According to Bloomberg, Monte Paschi’s common equity tier 1 capital ratio, a key measure balance sheet strength, would to a negative 2.2% in an adverse economic scenario, the test revealed, which put lenders through a simulation of a severe recession over three years. Another Italian bank, UniCredit, would see its ratio fall to 7.1% , the second-worst result of the five Italian lenders being examined. Needless, to say, the test – as structured – was a farce from the beginning as it did not account for negative interest rates, something Europe has trillions of, nor did it test for Brexit. Finally, the test did not include any banks from Greece of Portugal, where virtually all banks are currently insolvent.
- Gundlach: “Sell Everything, Nothing Here Looks Good”
Two weeks ago, an already bearish Jeff Gundlach appeared to hit the “glass floor” of negative sentiment, and smash right through it. On July 13, the new bond king said that there is “big money” to be made on the “short side.” Gundlach added that he has been selectively betting against shares in the Standard & Poor's 500 index and continues to favor emerging market bonds over high-yield “junk” debt. Gundlach was just as skeptical about bonds, warning that the yield on the 10-year Treasury note at around 1.38% to 1.39% “is a terrible trade location. It is the worst trade location in the history of the 10-year Treasury.” His caution seemed prophetic: it was followed by the biggest two-day spike in 10Y yields in 5 years. However, just like Gross' infamous “Bund Spike” last May, the selling in TSYs now appears to be over, and following a series of lousy data reports yields are once again sliding.
- EU approves imports of genetically modified Monsanto soybeans
The European Commission has approved the import and processing of Monsanto’s Roundup Ready 2 Xtend soybeans, after debates over glyphosate herbicide’s safety delayed the introduction of genetically modified soybean variety for months. “Today the Commission authorized three GMOs for food/feed uses (soybean MON 87708 x MON 89788, soybean MON 87705 x MON 89788 and soybean FG 72), all of which have gone through a comprehensive authorization procedure, including a favorable scientific assessment by EFSA,” the European Commission said in a statement Friday.
- Chinese & Russian navies to hold drills in South China Sea in September
China and Russia will hold naval drills in the South China Sea in September, the Chinese Defense Ministry told a news conference on Thursday, adding they are designed to strengthen cooperation between the two countries and were not aimed at raising tensions. “This is a routine exercise between the two armed forces, aimed at strengthening the developing China-Russia strategic cooperative partnership,” China's Defense Ministry spokesman Yang Yujun told a news conference, as cited by Reuters. He also added that the exercise is “not directed against third parties.”
- IMF admits disastrous love affair with the euro, apologises for the immolation of Greece
The International Monetary Fund’s top staff misled their own board, made a series of calamitous misjudgments in Greece, became euphoric cheerleaders for the euro project, ignored warning signs of impending crisis, and collectively failed to grasp an elemental concept of currency theory. This is the lacerating verdict of the IMF’s top watchdog on the Fund’s tangled political role in the eurozone debt crisis, the most damaging episode in the history of the Bretton Woods institutions. It describes a “culture of complacency”, prone to “superficial and mechanistic” analysis, and traces a shocking break-down in the governance of the IMF, leaving it unclear who is ultimately in charge of this extremely powerful organisation.
- ‘Unprecedented': European govts sold $1.3bn in arms to Middle East, some ended up with ISIS – report
Governments of Central and Eastern European countries have been selling an “unprecedented” amount of weapons and ammunition to the Middle East in recent years, fueling armed conflicts in the troubled region, a new report claims. According to the findings by a team of reporters from the Balkan Investigative Reporting Network (BIRN) and the Organized Crime and Corruption Reporting Project (OCCRP), a group of European countries led by Croatia and the Czech Republic have been channeling their arms to the region since 2012. Since then, they have gained over US$1 billion from such sales, despite some of the weapons ending up in the hands of Islamic State (IS, formerly ISIS/ISIL) terrorists, according to the report, which was published earlier on Wednesday.
- Paul Craig Roberts – We Are About To Witness The End Of The World As We Know It
Former U.S. Treasury Secretary, Dr. Paul Craig Roberts, just warned that we are about to witness the end of the world as we know it. Dr. Paul Craig Roberts: “World War II resulted in Europe being conquered, not by Berlin but by Washington. The conquest was certain but not all at once. Washington’s conquest of Europe resulted from the Marshall Plan, from fears of Stalin’s Red Army that caused Europe to rely on Washington’s protection and to subordinate Europe’s militaries to Washington in NATO, from the replacement of the British pound as world reserve currency with the US dollar, and from the long process of the subordination of the sovereignty of individual European countries to the European Union, a CIA initiative implemented by Washington in order to control all of Europe by controlling only one unaccountable government. With few exceptions, principally the UK, membership in the EU also meant loss of financial independence. As only the European Central Bank, an EU institution, can create euros, those countries so foolish as to accept the euro as their currency no longer have the power to create their own money in order to finance budget deficits.
- Hemlock Moment Coming for Financial Markets-Gregory Mannarino
Trader/analyst Gregory Mannarino says don’t be fooled by a stock market near all-time highs. Mannarino explains, “The reason we took out the last all-time high is the speculation that the world central banks are going to continue to stimulate and suppress interest rates and go deeper into negative territory. This is what caused this recent run-up here, but what you are not going to hear on mainstream media, and this is huge, this run-up we have seen, record high, record high, record high is on no volume. What does that mean? There is no conviction to this. We have seen this before at every single market top. . . . This can only go on so long. These stock buyback programs, these stimulus programs, at some point the medicine is going to turn to poison. It can only go so far. . . . It’s going to be a hemlock moment. To put a timeline on this is almost impossible because world central banks have become very resourceful. Nobody would have ever imagined the central banks would have done what they have done for so long. They have flipped the system upside down. They are so desperate now to keep the market propped up.”
- BREXIT BOOM: UK business deals up by 800 PER CENT in month following EU Referendum
BRITISH companies have raked in tens of billions in new deals, with an eight-fold increase in the space of one month, in a business bonanza since the UK voted to leave the European Union. Some 60 deals have been done in the month since Brexit, worth £26.3billion. This is in contrast to deals done in the month before the EU referendum which were worth just £3.2bn in total. One of the biggest deals has been the acquisition of chip designer ARM Holdings by Japan’s SoftBank for £24.4bn – in a clear signal that major countries remain committed to doing business with Britain. The news has been welcomed by the government, with Prime Minister Theresa May declaring Britain “open for business.”
- Corrupt Or Just Stupid? Markets Hand Corporations An Unlimited Credit Card
In the sound money community it’s generally understood that abandoning the last vestige of the gold standard in 1971 gave major countries effectively-unlimited credit cards – which corrupted them irredeemably. Now – with government bonds yielding either next to or less than nothing – that corruption has begun to spread to corporations, whose bonds are being snapped up by yield-deprived investors.
- Still Waiting for a Precious Metals “Correction”? Get Off the Dime and Buy Some Silver Ones…
Over time, charts for a bull market tend to print higher highs and higher lows on the way to the primary top. Two steps forward, one step back, creating a visual stair-step effect. This chart “picture” has been in evidence for gold, silver, and the miners since January. So far, waiting hasn't been a good strategy. Yes, there were a couple of times in April, and a month later in late May where you might have been able to buy and save some money. But things can get in the way of that plan. And for a number of people I've talked to, things apparently did. The first obstacle is Timing: Away from your computer, on a trip, sick, or depressed? Whoops, you missed the “correction.”
- Why A “Dollar” Should Only Be A Name For A Unit Of Gold
Prior to 1933, the name “dollar” was used to refer to a unit of gold that had a weight of 23.22 grains. Since there are 480 grains in one ounce, this means that the name dollar also stood for 0.048 ounce of gold. This in turn, means that one ounce of gold referred to $20.67. Now, $20.67 is not the price of one ounce of gold in terms of dollars as popular thinking has it, for there is no such entity as a dollar. Dollar is just a name for 0.048 ounce of gold. On this Rothbard wrote: “No one prints dollars on the purely free market because there are, in fact, no dollars; there are only commodities, such as wheat, cars, and gold.” Likewise, the names of other currencies stood for a fixed amount of gold. The habit of regarding these names as a separate entity from gold emerged with the enforcement of the paper standard. Over time, as paper money assumed a life of its own, it became acceptable to set the price of gold in terms of dollars, francs, pounds, etc. (the absurdity of all this reached new heights with the introduction of the floating currency system). In a free market, currencies do not float against each other. They are exchanged in accordance with a fixed definition.
- Goldman Raises September Rate Hike Odds To 30%, Sees 70% Probability Of Another Hike in 2016
In the absence of Jon Hilsenrath, whose “post-Fed-Mortem” is strangely missing today from the WSJ (although we haven't checked the ultra exclusive WSJ Pro), here is Goldman's assessment, which considering who makes NY Fed policy, is even more appropriate. According to Goldman, after parsing the Fed statement, September odds have risen to 30% (from 25%), while December incremental rate odds are 40%, “implying a roughly 70% probability of at least one rate increase this year.”
- Oil Stocks Still Treading 30-Year “Line In The Sand”
A key index of oil stocks continues to hold above its reclaimed 30-year old Up trendline; however, it’s been unable to mount any bounce off of it. A lot of our very recent commentary has focused on the historically tight trading ranges in the major averages over the past few weeks. Whether they are digesting recent breakouts or merely reflecting the market’s “dog days of summer”, there has been precious little movement among the indices. One area that has taken that tight range to an extreme is the oil & gas sector. Since displaying a bit of a pop in mid-April, the sector has essentially gone nowhere for the past 3 months. Specifically, as measured by the NYSE ARCA Oil & Gas Index, or XOI, the sector has traded within a 9% range over the past 13 weeks (i.e., a full quarter). If that doesn’t seem that tight, consider that in the previous 3 quarters, the XOI averaged nearly a 7% range per week. Now besides the dearth of action in the XOI, the other interesting aspect of the recent range is in its location. We have pointed out a few times (most recently in April) that the index’s lifetime Up trendline, stemming back to the lows in 1986, was still seemingly being respected by prices. Furthermore, this 30-year old trendline (which connects the lows in 2003 and late 2015) has appeared to delineate the safe periods in the sector from the “risk off” ones during 2016.
- Durable Goods Orders Crash Most In 2 Years – Longest Non-Recessionary Streak Of Declines In US History
Despite the longest winning streak for US macro data in US history, Durable Goods Orders collapsed in June. The 4% MoM plunge (vs -1.4% exp) is the biggest drop since Aug 2014. This represents a 6.6% YoY crash – the biggest drop since July 2015.
- A Fully Automated Stock Market Blow-Off?
About one month ago we read that risk parity and volatility targeting funds had record exposure to US equities. It seems unlikely that this has changed – what is likely though is that the exposure of CTAs has in the meantime increased as well, as the recent breakout in the SPX and the Dow Jones Industrial Average to new highs should be delivering the required technical signals. All these strategies are more or less automated (they may be tweaked from time to time, but essentially they are simply quantitative and/or technical strategies relying on inter-market correlations, volatility measures, and/or momentum). Active fund managers by contrast are said to be skeptical of the market rally, but it should be stressed that the evidence for this is purely anecdotal. The vast bulk of trading is nowadays automated. We recently read that in 2015, 23% of the entire year’s equity trading volume was accounted for by the top 100 ETFs (h/t to Brent Johnson of Santiago Capital). These are passive investments – in other words, they are brainless.
- Unsound Money Has Destroyed the Middle Class
When you start thinking about what money is and how it works, you face isolation, shunning, and possible incarceration. The subject is so slippery – like a bead of mercury on a granite countertop – you become frustrated… and then… maniacal. You begin talking to yourself, because no one else will listen to you. If you are not careful, you may be locked up among the criminally insane. We’ve been thinking about money for the last couple of months. It has become our favorite subject. That is why people edge away from us at parties. Our family finds novel ways to change the subject. “Whoa… sorry to interrupt, Dad… but isn’t that a flying saucer?” Undaunted, we press on. We think we’re onto something important. We have come so far; we might as well go the whole way.