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.
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Latest News From July 1, 2016 to July 7, 2016:
Collapse of Empires is Upon Us-Gregory Mannarino
Trader and analyst Gregory Mannarino says what is going on today with the FBI refusing to indict Hillary Clinton is nothing new when considering the “fall of empires.” Mannarino explains, “This is a cycle, and we are seeing several pieces fall into place regarding the political system and the financial system that we have seen over and over again. There is a lifespan of an empire . . . at the top of every empire . . . there is an issue of the financial system, and there is an issue with the political system that becomes absolutely corrupt. This is why this announcement (FBI not indicting Clinton) came. Again, this is political corruption. It’s not just here in the United States, but globally it is flashing red across the sky. . . . I think they are well aware that the whole system is going down. The collapse of empires is upon us. . . . We are in an environment that globally we have never seen before. With what we are seeing in the United States with the corruption in politics, we’ve seen that before. Every great empire, right at the top, the two key elements that appear are financial system on the edge and political corruption trying to patch it all together. That is something we see over and over again throughout history.”
Market turmoil to persist: Follow the money, follow gold
From geopolitics to socioeconomics, from environmental to technology, be it the body politic or personal health, as trend forecasters it is essential to have a clear understanding of where we are and the knowledge of how we got here to see where we are going. Global equity markets are in turmoil. However, the business media’s view of market mayhem is a snapshot in time dating to the June 23 “Brexit” when the United Kingdom voted to exit the European Union. Indeed, while Brexit triggered the current turmoil, our trends-eye view identifies the current market volatility in a Globalnomic® context far bigger than Brexit. For example, just one year ago, Chinese equity markets were in crash mode. The Shanghai Index, up 150 percent in a year, plummeted some 40 percent by mid-July 2015. In just one day, it had its second-biggest fall in its history. Following a summer that plunged Chinese markets into bear territory, global equity markets had their worst quarterly showing since 2011. It got worse.
These six former Goldman Sachs bankers want to destroy your savings
Rule #1 in central banking: Never go full Draghi. Mario Draghi, of course, is the President of the European Central Bank (ECB) who pledged to do “whatever it takes” to save the euro. Or was it save the world? We forget. Anyhow, Mark Carney, the head of the Bank of England, just went full Draghi, pledging to do, effectively, whatever it takes… even if that means destroy the British pound or economy. Future historians will no doubt look back at this period in amazement, wondering, given the stunning and murderous failures of Nazi Germany and Soviet Russia, how central planning ever managed to find a last hold-out amongst the world’s central banks. Yes, Britain may have finally escaped from the EU lunatic asylum.
State pension scrapped for under 30s?
One in five 18 to 30 year olds don’t believe there will be a state pension for them when they eventually retire. When asked about the new flat rate state pension , more than half admitted they hadn’t a clue how much it paid out, according to research from workplace pension provider NOW:Pensions. Once they knew the amount, currently £155.65 a week, two in five said that wasn’t enough to retire on. This come on the back of previous research from NOW:Pensions with 100 cross party MPs where almost one in six didn’t expect the state pension to be around 30 years time, or if there still is one it will be at a much lower level.
Property market turmoil has eerie echoes of start of financial crisis
The name “Bear Stearns” is enough to send a shudder down the spine of any investor who survived the financial crisis. The collapse of Lehman Brothers in September 2008 is generally regarded as the moment when the entire financial system almost came crashing down. But it is often forgotten that the glue that held it together had started to come unstuck more than a year earlier. The first sign that things were unravelling was when American investment bank Bear Stearns prevented investors taking money out of two mortgage-related hedge funds in the summer of 2007. Eventually, both were liquidated.
Globalists Are Now Openly Demanding New World Order Centralization
I have said it many times in the past — when elitist criminals start openly admitting to their schemes it means that they are ready to pull the plug on the current system. They simply don’t care anymore who knows their plans because they think that victory is inevitable. There have been more subtle and less prominently published calls for a “new world order” in the past, to be sure. However, at no other time have I seen international financiers and their puppet political mouthpieces so brazen about calling for global centralization than in the wake of the successful Brexit referendum. It is as if the Brexit flipped a switch in the existing narrative and set loose a flood of new propaganda, all aimed at convincing the general public that central banks must combine forces and act as one institution in order to combat an economic crisis that isn’t even visible to laymen yet.
FBI’s Hillary decision all part of jubilee plan towards greater chaos
Many people in the US were shocked that Killary Clinton was not indicted by the FBI today. Those people clearly have no idea what is going on. Since when has the government ever investigated itself (or its top figureheads and power players) and found itself guilty? You just have to look at the complete sham of the “9/11 Commission Report” to know that. Hillary has been selected (there are no real Presidential elections in the US) as the next President. Five of her close network attended Bilderberg this year where they have a record of selecting the next President. It matters not that she literally speaks in front of crowds that can be counted using your fingers while people like Bernie Sanders or Donald Trump speak in front of football stadiums. If people in the US don’t realize they are enslaved under a heinously criminal organization then the fluoride in the water, mainstream media programming and 12 years of government indoctrination camps have done their job. But, this goes far deeper than most realize.
Here We Go Again – Stockman Warns Of August 2007 Redux
Nearly everywhere on the planet the giant financial bubbles created by the central banks during the last two decades are fracturing. The latest examples are the crashing bank stocks in Italy and elsewhere in Europe and the sudden trading suspensions by four UK commercial property funds. If this is beginning to sound like August 2007 that’s because it is. And the denials from the casino operators are coming in just as thick and fast. Back then, the perma-bulls were out in full force peddling what can be called the “one-off” bromide. That is, evidence of a brewing storm was spun as just a few isolated mistakes that had no bearing on the broad market trends because the “goldilocks” economy was purportedly rock solid. Thus, the unexpected collapse of Countrywide Financial was blamed on the empire building excesses of the Orange Man (Angelo Mozillo) and the collapse of the Bear Stearns mortgage funds was purportedly owing to a lapse in supervision.
Economic crisis bares hunger problem in Venezuela
Kelly Vega says she lost 30 pounds in three months as she focused on feeding her 6-year-old daughter rather than herself. “We are eating two meals a day. If we eat breakfast, there’s no lunch. If we have lunch, there’s no dinner,” she said. This socialist country is suffering from severe food shortages that are making it hard to get enough to eat, even though Venezuela has the largest oil reserves in the world. Government officials blame the shortfalls on right-wing business owners hoarding products to sow chaos, while their detractors say it’s the result of chronic economic mismanagement.
The Thin Veneer Of Civilization That We All Take For Granted Is Evaporating All Over The Globe
Have you noticed that the world seems to be going a little bit more crazy with each passing month? Here we are halfway through 2016, and the rot and decay that are eating at the foundations of civilized society seem to be rapidly gaining momentum. Every single day, all of us take certain things for granted as we go through our normal routines. For example, as you walk down the street you probably take it for granted that someone is not going to pull out a gun and try to shoot you. As members of a civilized society, we have come to expect that our fellow citizens will behave in a certain way. Unfortunately, the thin veneer of civilization that we have all come to rely upon is steadily evaporating all over the globe, and chaos, crime and violence are all on the rise.
Legend warns this will totally devastate the world and the window to safe yourself is closing
With the price of gold and silver surging once again, even with the July 4th holiday in the United States, 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 what is coming will totally devastate the world and the window for investors to save themselves is closing.
Greeks See Wages and Pensions Slashed as New Round of Austerity Begins
The summer of 2016 turns out to be another summer of discontent for Greek pensioners and wage earners who see their incomes slashed, as a new round of austerity begins after the imposition of the new bailout program measures. It was exactly the same time last year (June 28) when Greeks found that the banks were closed and capital controls were imposed, continuing through today. This year, the end of June found wage earners and pensioners fuming or despairing in front of the ATM when they saw that their bank balances where lower than anticipated. And for hundreds of thousands of pensioners, the amounts were significantly less, even 48 percent lower in some cases.
America Has Become A Lawless Nation – Hillary Clinton Magically Cleared By The FBI
It is hard to be proud to be an American today after watching FBI director James Comey magically clear Hillary Clinton of all wrongdoing. Sadly, Comey is likely to go down in history as the man that struck the final death blow to the rule of law in America. During his address to the media, Comey admitted that Clinton sent or received 110 emails in 52 email chains that contained classified material at the time they were sent. But of course there were probably many more. Comey told the press that it was “likely that there are other work-related emails that they did not produce … that are now gone because they deleted all emails they did not return to State, and the lawyers cleaned their devices.” So basically Clinton turned over to the FBI whatever she felt like turning over, and then she destroyed the rest of the evidence. As a former lawyer, this infuriates me, but it doesn’t surprise me.
Sweden begins ball rolling to try to cut off gold acquisition by the masses as price begins to soar
One of the major reasons why the bullion banks have been able to keep the price of gold and silver down over the past four years is because only 1% of Americans and Europeans actually own the physical metals, or have not changed their investing paradigms to seek intrinsic safe havens rather than trust in paper assets. But since the beginning of the year, and with last week’s ‘shot heard round the world’ in the UK over their Brexit vote, central banks along with sovereign governments are now deathly afraid the people will finally wake up and rush to the door to get their hands on precious metals. And following the past two trading days of extreme movements upward in both gold and silver, one nation announced a sudden bank policy in which they will no longer allow bank deposits to be used to purchase gold or silver in an attempt to keep the masses from moving out of negative yield bonds and into real wealth protection.
Gundlach: “When Deutsche Bank Goes To Single Digits People Will Start To Panic”
Following today’s Fed minutes release, Jeff Gundlach had a far less “uncertain” message: “Things are shaky and feeling dangerous,” Gundlach told Reuters in a telephone interview. It’s not just stocks that Gundlach was not too excited about, he also had some choice words about buying Treasuries here. “You’re seeing people who hated the ‘2 percent’ 10-year suddenly loving it at a 1.38-1.39 percent revisit of the all-time low closing yield,” Gundlach said. “If you buy 10-year Treasuries now, I would say, it is a terrible trade location. In fact, it is the worst trade location in the history of the 10-year Treasury.”
Italy Faces Fight to Shield Bank Investors in Rescue, Fitch Says
Italian Prime Minister Matteo Renzi faces a battle to win European Union approval for a bank-rescue plan that protects investors from taking losses, according to Fitch Ratings. “We believe it will be difficult to reach the political consensus necessary to inject public funds as equity,” Fitch analysts Francesca Vasciminno and Cynthia Chan wrote in a note on Monday. EU state-aid rules, which normally require shareholders and junior creditors to share losses, can be waived in “exceptional circumstances” under the bloc’s treaties. Such an exemption requires unanimous approval by EU member states. Failing that, any injection of public funds under the bloc’s bank-failure law would be subject to state-aid rules.
Post-Brexit turmoil: Osborne promises to cut corporate tax to less than 15%
UK Chancellor George Osborne has outlined an ambitious plan to build a “super competitive economy” as Britain exits the European Union. His plan, among others, includes slashing the corporate tax to one of the lowest in any major economy. In an interview with Financial Times, Osborne stuck to his earlier warnings that a Brexit could tip the UK into a recession, but instead of dwelling on it, he said that he wanted a leading role in shaping the country’s new economy path. He said Britain should “get on with it” to prove to investors that the country was still “open for business.” Prior to the EU referendum vote, the Chancellor, was tipped to be moving next door to 10 Downing Street. However, post-Brexit, he has made it clear that although he will not be seeking to take over Prime Minister David Cameron’s role, he intended to steer the economy in a post-Brexit era.
Jetoil: Another Greek Company Files for Bankruptcy
Greek family business, Mamidoil Jetoil, is the latest in a chain of companies filing for bankruptcy according to article 99 of the Bankruptcy Code. The company dealing in storage, transport and trade of petroleum-based products in Greece and the Balkans was founded at the end of the Sixties by three brothers – Kyriakos, George and Nick Mamidakis. The company is following the same line adopted by Marinopoulos supermarket chain and filing for bankruptcy so as to receive temporary protection from its creditors. Recently, the company dealt with cash flow problems that caused it to streamline its operation and close down a number of its service stations due to an inability to pay suppliers.
LEAKED: Japan’s Mega-Pension Fund Plows into Stocks, Eats $50Bn Loss, Tries to Hide it till after Election
Abenomics is facing elections on July 10 for the less powerful Upper House. But Abenomics hasn’t fared very well. It engaged in the biggest (relative to the economy) money-printing and bond buying extravaganza the world has ever seen. The securities the Bank of Japan has bought, now at ¥426 trillion ($4.15 trillion), amount to 85% of GDP. About $8 trillion in Japanese Government Bonds sport negative yields. Even the 30-year yield is just about zero. The JGB market, once the second largest government bond market in the world, has frozen. The BOJ’s primary dealers are in revolt. Some have already pulled out. Savers are scared. Sales of safes to be installed at home have soared. There have been no structural reforms to speak of. Japan Inc. has benefited enormously, through various tax benefits and special stimulus packages, including foreign aid that is channeled back to Japanese companies. Government deficits are gigantic, providing additional stimulus for Japan Inc. And yet, the economy is languishing.
Something Huge Is Coming From Japan
Pretend, for a minute, that your country responds to the bursting of a credit bubble by borrowing unprecedented amounts of money and using it to prop up banks and construction companies. This doesn’t work, so you create record amounts of new money and push interest rates into negative territory in an attempt to devalue your currency. But this — amazingly — doesn’t work either. Your currency soars and the inflation you’d hoped to generate never materializes. Now what? Is there even anything left to try, or is it simply time to stand back and let the current system melt down? Those are the questions facing Japan, and the answers are not obvious. Here, for instance, is its inflation rate two years into the largest major-country money creation binge since Wiemar Germany.
June Auto Sales Down 4.6%, Much Worse Than Expected
Earlier today domestic auto sales came in a bit weaker than expected. Total numbers are now out. And they are much worse than expected. The Bloomberg Econoday consensus estimate for total vehicle sales in June was 17.3 million at a Seasonally Adjusted Annualized Rate (SAAR). The actual report shows 16.7 million SAAR sales.
Price Discovery, R.I.P.
That was quick. With nearly 85% of the Brexit loss recovered in three days and the market now up for the quarter and the year, what’s not to like? After all, the central banks are purportedly at the ready, and, in the case of the ECB and BOE, are already swinging into action according to their shills in the MSM.
All the Oil We’ll Never Pump Out
How many times have you read this line? Too many to count? While it’s plainly true, it’s also deeply misleading. It ignores a glaring fact about the gobs of oil under our soil: most of it will never see the light of day. I’m about to take you through the numbers, so buckle up: Let’s assume that in 2016 Venezuela produces 2.4 million barrels of oil per day (these are round numbers, deal with it.) Of these 2.4 million barrels, some 600 thousand barrels go to Chevy Caprices from 1980, (i.e., domestic consumption). That leaves 1.8 million barrels per day for exports, which is roughly $26 billion per year at $40/barrel – assuming we get paid in cash for oil exports!
The Fed’s Final Bullet
The Fed has no more maneuvers other than to jawbone the dollar lower. Because for a variety of reasons a strong dollar, in the current market environment, is akin to tighter monetary policy. And right now, in the wake of Brexit, tighter monetary policy is clearly not an option. Plus, a stronger dollar (by virtue of the “peg”) strengthens the Chinese Yuan and the Saudi Riyal… something neither country will tolerate. A monthly chart of USD-SAR – since the Riyal is pegged, this is essentially a straight line…but not always. Palpitations usually set in when a crisis is underway and oil prices are coming under pressure. The dollar’s whip-saw in 2016 has The Fed’s fingerprints all over it. The sequence is: Flawed forward guidance of 4 rate hikes (US dollar ramp), followed by a slowing US economy (US dollar softens)… and now the Brexit/ global economic fears (US dollar rallies in “flight to quality”).
When Government Controls All Wealth
Stock markets continued their rebound on Wednesday. The Dow rose 284 points… or just over 1.5%. London’s FTSE 100 Index was up 3.6%. And Europe’s equivalent of the Dow, the Euro Stoxx 50, was up 2.7%. Investors have realized Brexit isn’t the end of the world. First, because they think it won’t really happen. After all, elites can fix elections, buy politicians, and control public policy… surely, they can fix this! A letter in the Financial Times reminds us that Swedish voters cast their ballots against nuclear power in 1980. The government just ignored them, doubling nuclear power generation over the next 36 years. Second, because investors see the panic over Brexit leading to more spirited intervention by central banks! The EZ money floodgates – already wide open – are to be opened wider. The U.S. has its QE program on hold, but Europe’s scheme is gushing like Niagara. Mario Draghi at the European Central Bank buys $90 billion a month in bonds. And he’s not only buying government bonds; he’s buying corporates, too.
If the UK Economy Tanks, Don’t Blame Brexit
Last Thursday, the people of Britain voted in a referendum to leave the European Union (EU). Most commentators view Britain’s exit (“Brexit”) from the European Union as bad news for economic growth in the UK and the euro zone. As a result, it is argued, the growth rate in the rest of the world will be also badly affected. t is more likely that, whether the pace of real economic growth over time will weaken or strengthen is going to be set by the pace of expansion in the pool of real wealth. A strengthening in the pace of economic growth implies a strengthening in the rate of growth of the pool of real wealth. Conversely, a weakening in the pace of economic growth implies a weakening in the rate of growth of the pool of real wealth.
“You want to own gold” Mark Faber warns “Brexit is the excuse for QE4”
“If Brexit is used as an excuse, the central banks will print more money, QE4 in the U.S. is on the way and the depreciation in the purchasing power of currencies will continue,” warned a vociferous Marc Faber said in a Bloomberg TV interview today from Hong Kong. “In that situation, you want to own some gold,” he explained, carefully noting that central planners will be forced into this move because, despite all their extreme experimentation, “global growth has contracted, in other words, growth rates have been reduced and many countries are in recession already.” This has nothing to do with Brexit, stated the Gloom, Boom & Doom Report editor, “Brexit is actually not about an end of globalization. On the contrary, it’s about people that rebel against the arrogant elite in the financial centers.”
The subprime bubble grew by $1.4 trillion in just one month
Now, I don’t see a whole lot of difference between 2008’s subprime home loan borrowers, versus 2016’s subprime government borrowers. Neither borrower has the financial means to repay its debts. Back in 2008 the banks loaned money to subprime borrowers under the false premise that ‘home prices always go up.’ Today investors buy the bonds of subprime governments based on the false premise that ‘governments always pay their debts.’ Both assumptions are completely absurd and defy even the most cursory lessons of financial history.
Brexit will impact eurozone recovery: ECB board member
The uncertainty sparked by the British vote to leave European Union will “inevitably” harm economic recovery in the euro area, European Central Bank executive board member Benoit Coeure said in a newspaper interview Friday. The pick-up in the eurozone economy “will inevitably suffer from the ‘uncertainty shock’ that the British referendum has triggered, even if the impact is difficult to quantify at the moment,” Coeure told the French daily Le Monde. The effect would be all the more damaging because “the recovery in the euro area is already there. It’s healthy and driven by domestic demand and by investment,” even it was being “kept down by high unemployment levels and debt,” he argued. The victory of the Leave vote in Britain last week has already led to severe turbulence on the financial markets.
Scathing new report shows just how bankrupt Social Security really is
Last week, a group of analysts published an astonishing report about the future of Social Security in the United States, and their remarks were nothing short of damning. According to their calculations, for example, these analysts claim that Social Security is already running a huge deficit to the tune of tens of billions of dollars each year. In fact, this Social Security funding deficit has been taking place for several years now, and it’s actually accelerating. So the problem worsens each year. According to the analysis, the astounding rise in Social Security recipients vastly outpaces any growth in tax revenue received into the program. And this trend will continue for decades. The report goes on to describe Social Security’s two main trust funds, OASI (for ‘Old Age Survivors Insurance’) and DI (‘Disability Insurance’). They tell us that DI actually went bust several months ago.
What’s behind Venezuela’s economic crisis?
Tomorrow in Venezuela, President Nicolas Maduro will end electricity rationing that begun in April, following a drought that affected water levels at the hydroelectric dam that provides most of the country’s power. The rationing has cut off electricity to much of the country for fours a day. Still, Venezuelans are struggling with shortages of food, medicine and other necessities, with increasing finger pointing at Maduro’s leadership. For more on these challenges, “New York Times” reporter Nicholas Casey joins me via Skype from the nation’s capital, Caracas. Nicholas, the pictures and the stories that we’ve seen have been really tragic. I mean, we’re talking about people rioting for food. Has that basic need got any closer to being met?
The Collapse of Western Democracy — Paul Craig Roberts
There is controversy around the statement attributed to Martin Schulz, president of the EU parliament: “The British have broken the rules. It is not the philosophy of the EU that the crowd
can determine its fate.” This statement attributed to Schulz comes from a German language magazine. Here is the statement in German: “Die Briten verstoßen gegen die EU-Rahmenbedingungen, da es nicht in der Philosophie der EU liegt, dass der Mob über Aufstieg und Untergang der EU entscheiden darf.” This does translate to the English above. However, it appears that the statement was from a satire, whether of Schulz or the EU I do not know. I also do not know whether Schulz’s views justify the satirical jab or whether the words were assigned to him because of his position. Nevertheless, the fact that apparantly it was satire was lost in the transmission chain.
Russia & China Met Twice Last Week to Propose Monetary Reset – Willem Middelkoop
Russia and Chinese leaders met twice during last week and called (again) for an end to the current (dollar) system.From my contacts with Chinese insiders I know they really understand our problems well and are clearly preparing for The Next Phase (a monetary and geopolitical reset…
Gerald Celente – This Is Bigger Than Brexit
Although stocks bounced back on “Turnaround Tuesday” on the belief that contagion has been contained following the rout that wiped out $3.6 trillion from equity markets following Great Britain’s referendum last Thursday to “Brexit” the European Union… we disagree. It’s bigger than Brexit… Despite many of the world’s largest hedge funds betting billions on a “Remain” victory and British bookies putting the chances of “Leave” at barely 10 percent, in my June 15 KWN interview I said, “Should the ‘Leave’ vote win, we forecast the US dollar and gold prices will spike while equity markets, particularly those currently under downward pressure, will sink deeply lower.” Since then, gold hit two-year highs, the British pound fell to 31-year lows and currencies around the world hit new lows against the US dollar – or tested old ones – as investors sought safe-haven assets such as the dollar and Japanese yen.
SILVER JUST TOOK OUT $20: “We are at a flashpoint in history” — Andy Hoffman
Silver just took out $20 in Sunday night Globex trading, but that’s not all, silver briefly pierced $21 Sunday night before settling back to the mid $20’s. Andy Hoffman from Miles Franklin joins me for a Sunday update and warns, “We are at a flashpoint in history… there is literally a tiny, tiny window left for people to protect themselves before all hell breaks loose.”
Could This Rumor About China Be True? Plus The Latest On Gold, Silver, Brexit, Soros And More
With global markets continuing to experience wild trading in the aftermath of the historic Brexit vote, here is a quick update on the war in the gold and silver markets, the latest end of quarter rumors, plus gold, silver, Brexit and more.
Can This Be True? Is The Price Of Silver Really Headed To A Jaw-Dropping $690?
With the price of silver surging near $19 and the gold market holding recent gains at $1,320, the following was sent to King World News from analyst David P. out of Europe. The work below is not David’s and we are not sure if it comes from a colleague or not but it is worth featuring because of the astonishing price target that it sets for the price of silver.
Heal Yourself 101 – Learn to live the way you were designed
Everything you need to know on how to dramatically change your life and never get sick again. Many people who have done this have had dramatic results with everything from impotence to brain cancer. This isn’t a trendy fad diet, it’s an understanding on how to live the way we were designed. Explained in simple-to-understand language, this book gets straight to the point. You can change your life with simple things that cost almost nothing, right in your own home, starting immediately. This book was shared in the ‘10 Steps To Avoid The Crash‘ guide. Heal Yourself 101 was available for $29.97 and for a short period of time it is available in PDF format for free.
Doug Casey Debunks the Common Excuses for Staying In One Country
Tell a person that it’s a big beautiful world, full of fresh opportunities and a sense of freedom that is just not available by staying put and you will inevitably be treated to a litany of reasons why expanding your life into more than one country just isn’t practical. Let’s consider some of those commonly stated reasons, and why they might be unjustified. While largely directed at Americans, these are also applicable to pretty much anyone from any country.
Warning: This Could Be the Start of a Global Banking Crisis
Europe’s banking system is collapsing. Over the past year, shares of Deutsche Bank (DB), Germany’s biggest bank, have plunged 56%. Swiss banking giant Credit Suisse (CS) is down 62% over the same period. Yesterday, both stocks hit record lows. Dozens of other European bank stocks have also crashed. The Euro STOXX Banks, which tracks 48 of Europe’s largest banks, is down 48% over the past year. This is a major issue. That’s because banks are the cornerstone of the financial system. They keep money flowing through the economy. If they’re struggling, it often means the economy is having major problems. Right now, European banks are flashing bright warning signs. That’s not just bad news for Europe—it’s also a serious threat to the rest of the world.
What does the Brexit mean for the global oil market?
The voters’ decision to leave the EU has created a global ripple effect. The global oil market is now getting ready for a longer delay in investments and pricing suppression, an economic slowdown not needed at the time. Immediately, the value of a pound dropped to a thirty-year low of $1.34, the price of Brent fell 5%, and the world’s stock exchanges experienced a plunge.
Do emerging markets like Brexit?
Who’s afraid of a big bad Brexit? Not emerging markets who have been through days of strong growth, including having currencies buoyed against the US dollar since Britain voted to leave the European Union last week. In Brazil, the currency real opened 2.16 per cent stronger against the US dollar on Wednesday, reaching its highest level in 2016. It was a similar picture for the Mexican, Chilean and Colombian pesos. Meanwhile, the Russian ruble appeared to have regained considerable ground reaching its strongest against the US dollar since October last year. The benchmark Russian exchange MICEX continued its second day of gains, growing 1.3 per cent in similar fashion to markets in other emerging economies. Overall, while most global markets roiled as Brexit caused $3 trillion in investments to be shaved off exchanges around the world, emerging economies fared better.
Oil Crashes on Brexit, Oil Imports at a 42 Month High, Record Gasoline Output and Usage
Oil prices crashed along with global financial markets on Friday following the British vote on Thursday to exit the European Union (typically referred to as “Brexit”), which is widely expected to precipitate a period of political instability in Europe. Conservative British Prime Minister David Cameron, who had campaigned for remaining in the EU, submitted his resignation; British Labor Party leader Jeremy Corbyn also faces a no-confidence vote, as both major parties had campaigned to remain in the EU. In response to the British vote, populist parties on the left and right across Europe are calling for referendums in their own countries, with speculation that France, the Netherlands, Austria, Finland and Hungary might also vote to leave the EU, effectively rebalkanizing the continent.
Brexit BOOM: FTSE 100 leaps to HIGHEST level since 2015 just a week after EU referendum
BRITAIN’s top stock market has surged to its highest level in almost a year, just one week after the vote to leave the European Union (EU). The FTSE 100 jumped again in Friday trading to sit at around 6,577 – its highest level since August 2015. The index has been climbing since Tuesday as confidence recovered from the initial shock over the outcome of the referendum. Despite experiencing one of the most volatile weeks since the 2008 financial crisis, the FTSE posted its best week since December 2, 2011, making gains of 7.15 per cent.
NIRP Absurdity Soars after Brexit, Hits $11.7 Trillion
The amount of government bonds that sport negative yields – an all-too-real absurdity where bondholders in effect are shanghaied into paying the government for the privilege of lending it money – has soared 12.5% after the Brexit vote, from $10.4 trillion at the end of May to $11.7 trillion as June 27, Fitch Ratings reported today. The action was in longer-dated bonds, with maturities of 7 years and over. Those with negative yields soared to $2.635 trillion, up 62% from the end of May and up 93% from the end of April, having nearly doubled in two months! The German 10-year yield fell below zero during the period, now at -0.124%. Japanese yields are below zero all the way out to 17 years. And “virtually all” of the Swiss sovereign debt luxuriates in negative yields.
Cryptocurrency Crash
One of the more profitable trades this year was in the cryptocurrency Bitcoin. For those unfamiliar, Bitcoin is a digital asset and payment system — a virtual currency. It’s considered a cryptocurrency because it doesn’t require a central bank to handle its transactions. It’s all self-contained through technology that encrypts and records a ledger over a distributed computer system. This technology is called the blockchain. The benefit of blockchain technology comes from its transparency. Everyone can see every transaction. The whole system is also decentralized. There’s no single institution or bank that controls the transferring of assets back and forth. This (advocates claim) removes the possibility of corruption, theft, and a whole host of other common problems that come with your standard financial system.
It Gets Real: Manhattan Apartment Sales Plunge
Real estate is local. And so housing bubbles are local. When enough of them happen, they coagulate into a national phenomenon. This has already happened. In March 2013, we started calling this phenomenon Housing Bubble 2, and we’ve watched in awe how it bloomed, nurtured by ultra-low mortgage rates, government subsidies, the Fed that is relentlessly “healing” the housing market, yield-desperate investors, private equity firms, Wall Street, a surge of foreign buyers who want to get their money – however they’d obtained it – out of harm’s way, and a million other factors. All of it has been accompanied by a national boom in hype. Now there are signs that our awe-inspiring Housing Bubble 2, like all housing bubbles, is beginning to unravel. This too is local, here and there, while still booming in other places. It shows up in some key markets. Then it spreads. When it spreads far enough, the unraveling of Housing Bubble 2 becomes a national phenomenon.
How Can We Celebrate Our Independence When Most Americans Are Willingly Enslaved To The Matrix?
Did you know that the average U.S. adult consumes 10 hours and 39 minutes of media a day? Nielsen has just released brand new numbers on the media consumption patterns of Americans, and they are absolutely staggering. According to Nielsen, the amount of media that we consume per day has increased by an hour just since the first quarter of 2015. This is the time of the year when we celebrate our independence, but how in the world can we ever be truly independent when most of us are willingly plugging ourselves into “the Matrix” for more than 10 hours a day? If you feed anything into your mind for hours every day, it is going to change the way that you think, the way that you feel about things, and the way that you view the world. This endless barrage of “news” and “entertainment” has fundamentally altered the belief systems of tens of millions of Americans, and this has very serious implications for our society moving forward.
Rio 2016: ‘Welcome to Hell’ warn police
There was a nasty surprise awaiting passengers in the arrivals hall at Rio de Janeiro’s Galeao International Airport on Monday. Along with the relatives carrying flowers and taxi drivers waiting with name boards there were lines of off-duty police with banners that had a far more ominous message: “Welcome to Hell”. “Police and firefighters don’t get paid,” the banners, in English and Portuguese, went on. “Whoever comes to Rio de Janeiro will not be safe”. Photos of the protest have been widely shared on social media and in the Brazilian press. The image above was posted on the photo sharing site Imgur, where it was viewed more than three million times in less than a day.
Puerto Rico Says It Will Default Even With Congressional Aid
Two days before a potential historical default, Puerto Rico Governor Alejandro Garcia Padilla made it clear that the commonwealth won’t pay bondholders even as Congress votes on a bill allowing the island to restructure its $70 billion in debt. “On July 1, 2016, Puerto Rico will default on more than $1 billion in general obligation bonds, the island’s senior credits protected by a constitutional lien on revenues,” Garcia Padilla wrote in a editorial posted on a CNBC website. The lapse will mark the first time the U.S. territory has failed to pay what it owes on general-obligation debt, a $13 billion swath that its constitution says has the top claim to the government’s funds. Garcia Padilla previously said the commonwealth couldn’t raise enough to cover what’s owed to bondholders even if he shut down the government. The island has about $2 billion in principal and interest payments due Friday.
Millennials Are Pretty Cocky About Their Investing Skills
One of the great things about young people is their optimism, the confidence that everything is going to work out. Sometimes, though, that can get them into trouble, like behind the wheel of a car. Or as an investor. A new survey found millennials were more positive about the future than their parents when it came to investments. They also think themselves far more knowledgeable about how to manage money, which, as anyone will tell you, might translate into behavior that leads to bad financial outcomes.
World-Check terrorism database exposed online
A financial crime database used by banks has been “leaked” on to the net. World-Check Risk Screening contains details about people and organisations suspected of being involved in terrorism, organised crime and money laundering, among other offences. Access is supposed to be restricted under European privacy laws. The database’s creator, Thomson Reuters, has confirmed an unnamed third-party exposed an “out of date” version online. But it says the material has since been removed. Security researcher Chris Vickery said he discovered the leak. He notified the Register, which reported that it contained more than two million records and was two years old.
Repo Rates Surge to Post-Crisis High as Bank Dealers Pare Back
The rate for borrowing and lending government debt surged Thursday to the highest since the financial crisis as banks reined in collateral lending to shore up balance sheets ahead of the quarter-end. With fewer dealers borrowing cash and posting government debt as collateral, money funds — the key lenders of cash in the repurchase agreement market — gravitated to buying Treasury bills and parking cash with the Fed via their RRPs during quarter-end, driving overnight rates higher.
Richmond Fed Dead-Cat-Bounce Crashes To 3-Year Lows
With the biggest miss in two years, Richmond Fed collapsed to -7 (lowest since Jan 2013) from March’s 22 print (six year highs). The farcical flip-flop leaves the average workweek plunging into contraction, number of employees dropping, New Order volume crashing, and worse still, future expectations of hisring and work week is plunging. Best in 6 years to worst in over 3 years…
Forget December. Forget Next Year. The Fed’s Done Hiking Until 2018
Circle Jan. 31, 2018, on the calendar. That’s the soonest the Federal Reserve hikes next. At least if money market derivatives are to be believed. Traders, who have consistently been better at projecting the path of interest rates than the Fed itself, are now pricing in a greater probability that policy makers will cut rates in upcoming meetings than raise them. They don’t assign more than a 50 percent chance of an increase until the beginning of 2018, and don’t price in a full rate hike until the final quarter of the year.
The Recent Rise in Delinquency Rates on Bank Loans Is Shocking (Is a New Banking Crisis Imminent?)
The delinquency rate on loans is key in understanding banking. It answers one question: what percentage of loans is overdue for payment? The delinquency rate is by far the most useful indicator for “credit stress.” It seems, however, as if delinquency no longer counts. Few are paying attention to the quick and sudden rise of the delinquency rate. What does it tell us and is a new banking crisis imminent? This Is What Happened after Janet Yellen Hiked the Fed Funds Rate in December. I have said it many times over and I will repeat it here: the last time around, it took Fed-chairman Alan Greenspan over two years and seventeen rate hikes to bring the Fed funds rate from a then all-time-low of 1% to 5.25%, before the U.S. economy suffered the worst recession since the 1930s. We are not so lucky this time.
April Spending Exuberance Plunges Back To Earth In May As Income Growth Slows
After an exuberant April, spiking hope that everything was awesome with a surge in spending, May has dragged US consumers back down to earth. The 1.1% (revised) jump in spending in April (highest since Aug 09) is over as May’s 0.4% gain is back in the land of ‘normal’ once again. Income rose just 0.2% MoM (less than expected) slowing dramatically from last month to near the weakest YoY growth since March 2014. The savings rate fell once again on the back of this (down 0.1%) to 5.3%. With YoY Income growth almost the weakest since March 2014 and spending fading…
Pending home sales down 3.7%, marking first annual drop in two years
The final push of the spring housing season turned out weaker than expected. Signed contracts to buy existing homes fell 3.7 percent in May compared to April, according to the National Association of Realtors. April’s reading was revised down. These so-called pending home sales were 0.2 percent lower than May of 2015, the first annual drop since August of 2014. “With demand holding firm this spring and homes selling even faster than a year ago, the notable increase in closings in recent months took a dent out of what was available for sale in May and ultimately dragged down contract activity,” said Lawrence Yun, chief economist for the Realtors. “Realtors are acknowledging with increasing frequency lately that buyers continue to be frustrated by the tense competition and lack of affordable homes for sale in their market.”
API Claims A 3.9 Million Barrel Draw
The latest inventory report by the American Petroleum Institute injected some optimism into crude oil markets, suggesting that U.S. stockpiles fell by as much as 3.9 million barrels in the week to June 24. This is significantly more than the 2.4 million barrels seen by analysts polled by Reuters and the sixth consecutive week of inventory draws, should the API information be confirmed by the official figures that will be released later today by the Energy Information Administration. Last week, the API said inventories had plummeted by 5.2 million barrels in the week to June 17, but EIA data revealed that the draw was much more moderate, at less than a million barrels.
East Coast Ports Hit By Import Decline
Imports slumped at some of the East Coast’s busiest ports in May, as high business inventories and shifting trade patterns that favor the West Coast curbed volumes. On Tuesday the Port Authority of New York and New Jersey reported that May loaded imports fell to 268,861 twenty-foot equivalent units – a common measure of shipping container volume – down 4.7% from the same month last year. The total volume of containers passing through the port fell by 6.1% in May.
Chiacgo PMI Spikes To 18-Month High – 7 Standard-Deviation Beat – As Employment Crashes?!
Seriously!! Chicago PMI spiked to 56.8 in June (from 49.3) – higher than the highest estimate and seven standard deviations above expectations. This is the highest since Jan 2015. Simply put, the number is beyond any credibility, as despite higher orders and output, demand for labor fell as employment contracted at the fastest pace since November 2009.
Carney prepares for ‘economic post-traumatic stress’
The Bank of England is preparing to unleash another round of monetary stimulus as it battles to contain the economic fallout of The UK’s decision to leave EU. In a stark warning to politicians, governor Mark Carney said a downturn was on its way and Britain was already suffering from “economic post-traumatic stress disorder”. He said the central bank would take “whatever action is needed to support growth”, which probably included “some monetary policy easing” in the next few months, in an attempt to reassure the markets and the general public. But Mr Carney also said that central bankers could do only a limited amount to mitigate the pain.
“You Want To Own Gold” Marc Faber Warns “Brexit Is The Excuse For QE4”
“If Brexit is used as an excuse, the central banks will print more money, QE4 in the U.S. is on the way and the depreciation in the purchasing power of currencies will continue,” warned a vociferous Marc Faber said in a Bloomberg TV interview today from Hong Kong. “In that situation, you want to own some gold,” he explained, carefully noting that central planners will be forced into this move because, despite all their extreme experimentation, “global growth has contracted, in other words, growth rates have been reduced and many countries are in recession already.” This has nothing to do with Brexit, stated the Gloom, Boom & Doom Report editor, “Brexit is actually not about an end of globalization. On the contrary, it’s about people that rebel against the arrogant elite in the financial centers.”
What are my choices?
Pastor Williams has asked me to share with you this information from an unknown source regarding your choice in the upcoming November presidential election. Please share it with everyone you can. If I were not already convinced this message would have convinced me. It is also a good read as it makes its points!
Hillary Clinton says American 401(k)s lost $100 billion after Brexit vote
In a speech attacking her opponent, Hillary Clinton said Donald Trump cheered while the economy reeled in the aftermath of Britain’s shocking vote to leave the European Union. “On Friday, when Britain voted to leave the European Union, he crowed from his golf course about how the disruption could end up creating higher profits for that golf course, even though, within 24 hours, Americans lost $100 billion from our 401(k)s,” Clinton said in Ohio June 27. “He tried to turn a global economics challenge into an infomercial.” Trump did say last week that Brexit would benefit Turnberry, his golf course in Scotland, because a weaker pound would bring more tourists. We wondered, though, about the other part of Clinton’s claim: that Brexit caused 50 million Americans with 401(k) retirement savings accounts to lose $100 billion in just 24 hours.
‘The end is coming,’ says Ron Paul
The historic U.K. vote to leave the European Union is a sign of a major global meltdown, not just a watershed that marks the end of a unified continent, former Rep. Ron Paul says. “I think [the EU] will become nonfunctional,” Paul told CNBC’s ” Futures Now ” on Tuesday. “It really is coming to an end. It doesn’t mean tomorrow or the next day, but people are going to be really unhappy. The end is coming, but it isn’t coming because of the breakup,” he added. Paul attributed the fallout to “bad fiscal policies” around the globe. He said that as long as interest rates remain low, the markets will remain in bubble territory.
Brexit will allow insurers to escape ‘absolutely dreadful’ EU regulation, claims former civil service chief
British-based insurers may be better off outside the EU because capital rules have damaged competitiveness and constrained the sector’s ability to expand, according to the former head of the civil service. Lord Turnbull, who served as a non-executive director at Prudential for almost a decade, described the regulatory framework, known as Solvency II, as “absolutely dreadful”. Solvency II has drawn widespread criticism from the industry and UK regulators, which have warned that the high costs of implementing the framework have so far failed to level the playing field in the sector. Lord Turnbull said the UK’s decision to leave the EU could benefit the industry.
This economist thinks China is headed for a 1929-style depression
Andy Xie isn’t known for tepid opinions. The provocative Xie, who was a top economist at the World Bank and Morgan Stanley, found notoriety a decade ago when he left the Wall Street bank after a controversial internal report went public. Today, he is among the loudest voices warning of an inevitable implosion in China, the world’s second-largest economy. Xie, now working independently and based in Shanghai, says the coming collapse won’t be like the Asian currency crisis of 1997 or the U.S. financial meltdown of 2008. In a recent interview with MarketWatch, Xie said China’s trajectory instead resembles the one that led to the Great Depression, when the expansion of credit, loose monetary policy and a widespread belief that asset prices would never fall contributed to rampant speculation that ended with a crippling market crash.
UK faith leaders unite in condemning post-referendum rise in xenophobic abuse
Leaders of Britain’s main faith communities have united in condemning intolerance amid mounting reports of xenophobic and racist abuse in the wake of the EU referendum result. The Anglican archbishop of Canterbury, the Catholic archbishop of Westminster, the chief rabbi and senior imams have all spoken out against division and expressions of hatred. In Brussels, the United Nations human rights chief said he was deeply concerned about reports of attacks on minority communities and foreigners. Zeid Ra’ad al-Hussein urged the UK authorities to prosecute those responsible, saying racism and xenophobia were “completely, totally and utterly unacceptable in any circumstances”. Police recorded a 57% increase in hate crime complaints in the four days following the referendum, in which immigration was a key plank of the leave campaign. Justin Welby, the leader of the Church of England, said people of “evil will” were using the referendum result as an excuse to vent their hatred.
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