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  • Armstrong and the repo storm

    Armstrong spent a total of 11 years in prison when crooked NYC banks tried to get his program. Ultimately, the fault was crooked GOV. Later, he advised the Chinese to buy treasury paper directly from the FED GOV and bypass the primary dealers. He got a bit of revenge on the big NYC banks.
    Armstrong predicts a rotation OUT of GOV debt and, INTO private debt. This may very well be true.
    As is typical, he was correct to the day on his predictions of the economic low point in India.
    Just how much temptation does he have to predict a crash of public debt to get back at the entity who stole 11 years of his life?
    The economic writers claim that there is NO legitimate replacement for the U.S.
    dollar because, there is no market with the size and depth of the U.S. treasury market.
    Currently, the repo market from the FED is going crazy trying to support all the sketchy banks. Will this lead to a breakdown of the public debt markets? I have no idea. If Armstrong is correct, something will lead to a breakdown.

    The State is forcing the CB to "fix" everything with monetary policy. The FED is crying for the State to fix everything with fiscal policy. The FED sees the writing on the wall and, is preparing to completely change it's "mission"
    "So what is a central banker to do? Hildebrand’s proposed solution was presented in a paper he wrote with three of his colleagues at BlackRock, the world’s largest asset manager, where he is now vice chairman. Released in August to coincide with the annual Jackson Hole meeting of central bankers, the paper was co-authored by Stanley Fischer, former governor of the Bank of Israel and former vice chairman of the U.S. Federal Reserve; Jean Boivin, former deputy governor of the Bank of Canada; and BlackRock economist Elga Bartsch. Their proposal calls for “more explicit coordination between central banks and governments when economies are in a recession so that monetary and fiscal policy can better work in synergy.” The goal, according to Hildebrand, is to go “direct with money to consumers and companies in order to enliven consumption,” putting spending money directly into consumers’ pockets."

    "directly into consumers’ pockets" Sounds a lot like universal basic income.
    "The central bank would maintain a “Standing Emergency Fiscal Facility” that would be activated when interest rate manipulation was no longer working and deflation had set in. The central bank would determine the size of the Facility based on its estimates of what was needed to get the price level back on target. "
    "n short, Hildebrand and co-authors are not talking about central banks giving up their ivory tower independence to work with legislators in coordinating fiscal and monetary policy. Rather, central bankers would be acquiring even more power, by giving themselves a new pot of free money that they could deploy as they saw fit in the service of “government objectives."

    Currently, the PPT, ESF, FED and treasury are pumping "money" into markets willy-nilly. The new idea proffered here would be to streamline and institutionalize liquidity injections to the individual rather than channelling injections through the private banks.
    The article goes on examining different possible plans.
    The East will NEVER endorse a reserve currency created out of thin air by the West.

    More on "repo"
    "QUESTION: Marty; You warned that there would begin a cash shortage and real rates would rise in the private sector starting in September after Labor Day. Ok, it’s about 15 days past that marker and Repo rates have gone completely nuts hitting 10% forcing the Fed to intervene. They were calling it Armstrong’s revenge here in the dealing room. It certainly appears the Fed has lost control of short-term rates as you warned. Is this the start of the chaos you have warned about?"
    "ANSWER: It’s not my revenge, it’s fiscal mismanagement. Look, this is the chaos we have coming and sorry, it is the beginning, not the end. It’s not even a fluke or a blip. So get used to it. Indeed, the Fed has lost control of short-term rates. Trump can jawbone all he wants for zero to negative rates. Sorry! The free markets are showing something else lies in wait.

    The Repo Rate reached a high of 10% by about 9 am just before the stock market opened. The fed funds rate was testing the Fed’s upper limit. The Fed was forced to intervene I believe for the first time since the 2008 crisis."
    "On Tuesday, the Fed offered $75 billion through its facility and received $53 billion of demand from borrowers who swap AAA Treasury holdings for cash at minimal rates"
    It's hard to believe that there is a shortage of cash at the bank level.

    "Overnight financing (REPO Rate) is a basic function which holds the economy together. Those who trade on leverage rely on the REPO market (Broker-dealers, hedge funds, and institutional). It is rarely written about for it is not generally seen by the public. The events of the past few days is a clear warning sign of what I have been yelling about which is on the horizon. The central banks are TRAPPED and in Europe, they have destroyed their bond market with more than $15 trillion and perhaps up to $17 trillion in negative-yielding bonds "

    "NEGATIVE Repo Rates can happen when there is a shortage of cash or particular collateral security, like negative-yielding bonds, are put up to borrow against. Therefore, trying to borrow against a negative-yielding bond can present a crisis. The standard Repo contracts, such as the Global Master Repurchase Agreement (GMRA), have been drafted under the implicit assumption that general collateral (GC) Repo Rates would only ever be positive."
    "We are looking at SERIOUS credit risk once again but instead of the time bombs being mortgage-backed securities, this time it will be negative-yielding bonds issued by governments. The bond markets have been converted into a child’s game of musical chairs. When the music stops, someone will be left holding negative-yielding bonds that will only be salable at even deeper discounts of perhaps as great as 50% in a few years."

    "The financial system simply doesn’t work with negative rates and this is also contributing to shortages of cash for Repo markets. A slight rise in interest rates will create a massive debt crisis and if you undermine the bond market, that is what creates great depressions. Negative yields have been confined to places outside the USA and the intervention of the Fed implies they are not prepared to allow negative rates to undermine the US economy as they have done in Europe."
    You can see the problem. Everyone dumps treasury debt. The sovereign bond market collapses. FED GOV is completely insolvent. 51% of Americans receive a check from GOV,,,, 44 million receive direct public assistance. The safety net would be completely useless. The FED now rolls out the Standing Emergency Fiscal Facility This would be activated when the bond market implodes. The banks will, obviously, fight against being bypassed for liquidity injections. This UBI can NEVER be implemented until after a crash.

    "Unlike the 2008 crisis where the time bombs were private debt, Tuesday’s abrupt rise in short-term rates wasn’t obvious that the financial system was in trouble because sovereign debt is assumed to be AAA and risk-free. Not sure whoever started that huge lie.

    Nevertheless, we have a convergence of forces which are creating the perfect financial storm on the horizon. Immediately, corporate tax payments are due so corps have less cash to sell overnight. Then there are big Treasury auctions as deficits continue to rise for governments always borrow, yet never pay off the debt as if this can continue without end."

    The interest rate risk that negative-yielding bonds carry is beyond unbelievable. It is totally artificial supported only by punters. The financial system simply doesn’t work with negative rates and this is also contributing to shortages of cash for Repo markets. A slight rise in interest rates will create a massive debt crisis and if you undermine the bond market, that is what creates great depressions. Negative yields have been confined to places outside the USA and the intervention of the Fed implies they are not prepared to allow negative rates to undermine the US economy as they have done in Europe.

    I have been warning that we are headed into a major financial crisis that will be a liquidity event which involves government – not simply the private sector as was the case in 2008. So buckle-up. I have been warning this is something NOBODY has ever witnessed before and if Socrates was actually alive, he would be screaming bloody-murder by now. The Institutional Bond Report will be going out to all our Institutional Clients. Those who have been thinking about joining our Institutional client base can purchase a copy $3,500."
    Ok, so there is a cash shortage and nobody wants to loan to the government. In 1913, the government gave up it's right to coin new money,,,, gold & silver. I'm sure that, if / when things get bad enough, US GOV will authorize itself to print money directly / electronically.

    Russia has reduced it's public debt,,, getting ready for the collapse in public debt.
    Here is a good article on mean reversion.


    • Squeezing liquidity out of the repo market

      9/20 Why is the Fed pumping money into the banking system? – BBC
      Well, because the banks need it,,,, because that is pretty much all they can do when ZIRP lays waste to the financial system

      Liquidity Shortage Getting Worse: Fed's Repo Oversubscribed As Funding Demand Soars 50% Overnight
      "What is immediately notable is that except for agency paper, there was a greater use of both Treasury ($40.9BN to $51.6BN) and Mortgage-backed ($11.7BN to $27.8BN) collateral."
      So, they're dumping Treasury paper and mortgage backed paper. That tells you something.
      "Yesterday's Fed repo operation - the first direct liquidity injection in a decade - was an unmitigated disaster, with the NY Fed forced to cancel it in the middle due to "technical difficulties" which nobody still know what they were"

      9/20 Yield curve still inverted despite Fed rate cut – Mish
      An ebb tide lowers all boats
      9/20 Mark Spitznagel warns “They’ve created a snowflake market” – Zero Hedge
      Reference to an avalanche?
      9/19 Repo chaos tests Wall Street confidence in NY Fed’s Williams – Reuters
      9/19 ‘This is crazy!’: Wall Street scurries to protect itself in repo surge – Bloomberg
      9/19 Liquidity shortage getting worse: Fed’s repo oversubcribed again – Zero Hedge
      9/19 Negative interest rates are just the price for the end of civilization – Hof Profit

      9/19 China’s mighty trade engine Is stalling as negotiators seek deal – Bloomberg
      Seeing this, Trump has put China up against a wall.
      9/19 Debt-wracked Chinese companies dump US & other foreign assets – Wolf Street

      9/20 The triumph of Trump’s foreign policy: backing off ‘disastrous war’ with Iran – ZH


      • world economy locked in to a fall in consumption

        Well, the climate change BS runs deep. Climate change is not a hoax because the sun is indeed changing. Add to that, the pole shift and, weakening of the magnetosphere. Just the same, charging additional taxes will NOT change the magnetosphere.
        Germany Disappoints: Announces Massive Climate Plan (That Is Fiscally Neutral)
        Despite all the hope of fiscal largesse from the market and pressure from ECB's Draghi, Germany has unveiled a "3-digit-billion" euro plan to address climate change, but it will have "neutral impact" on government finances.
        DO NOT WORRY.
        OECD Slashes Global Growth Outlook, Warns Germany Already In Recession
        Germany readying stimulus plan as contingency for deep recession.
        Pox Americana channels it's stimulus through the military-industrial complex.
        Apparently, Germany plans to channel it's stimulus through "green" projects.

        Cooperman: If Warren Wins They Won't Open The Stock Market

        Trader Deals With 'Strange Emotion': "With Each Uptick In Stocks, I'm Getting More Queasy"

        Futures Frozen With $8.3 Billion Expiring At S&P 3,000 On Quad-Witching Friday

        'Rogue' Oil Trader Lost $320 Million On Wrong-Way Derivatives Bets

        Escobar: How The Houthis Overturned The Chessboard

        The Yemeni Shiite group’s spectacular attack on Abqaiq raises the distinct possibility of a push to drive the House of Saud from power...

        Guatemala: 'We're Not Just A Drug Trafficking Hub - We Produce Tons Of Cocaine Too!'

        Precious metals manipulation started about 1974 with the creation of the first futures market for gold. Since then, every commodity has been cursed with a futures market. This originally helped producers to lock in profits. Later, it morphed into a system to allow speculators to lock in profits. The gold market is special because it's stock-to-flow ratio makes it exceptionally good as a bastion of stability. Over the years, gold has become suppressed in price by the State so that it would not be considered a store of value in competition with government bonds.
        GOV bond markets are falling apart, as predicted by Armstrong. "The Trump effect" is causing the State to go after the commodity manipulators. Theoretically, this could entice investors to move to gold.There are 100 ounces of paper gold for every 1 ounce of physical gold. Any move to true price discovery in gold would blow up most other markets also.

        Exposing The Financial-Political-Complex Protecting Its Own In The Gold Manipulation Maelstrom

        Regulators Expand Already Massive Precious Metals Manipulation Probe To Other Markets

        9/20 Dave Kranzler: repo rates and gold — something big is happening – GATA
        9/20 Gold consolidates as the Fed loses control – 321Gold
        9/19 You can’t print gold – Gold Republic

        A complete blowup of the paper gold market would / will? bring down a big mess.

        The Aussies are hunting for loose change.
        "Australia has become perhaps the MOST aggressive country in Western Culture to hunt down its own citizens for money. They follow school children and then investigate how the parents are paying for the school. The Australian Tax Office (ATO) has applied for access to everything to hunt for money. They want access to phone calls, emails, posts, and SMS text messages. New South Wales police have come up with the most bizarre excuse to rob your money I have ever heard of. They now claim that driver safety is the main reason for this new initiative to confiscate whatever coins you have in your car. They have the audacity to claim that “Loose coins within cars are a safety hazard.” '

        Here is something to think about from Armstrong;
        "So, why do I say that ALL currency is backed to this very day and it is not simply fiat with no intrinsic value? All currency is backed by the total productive capacity of its people. For further proof of that statement, just look at China, Japan, and Germany and you will see that each economy rose to the top 10 list in the world when they had NO gold reserves after World War II. It was the total capacity of its people that created the wealth of those nations."

        "Italy has more gold reserves than France. Yet, Italy is considered to be the third-largest economy in Europe behind France. Algeria has the largest gold reserves in Africa followed by South Africa. At the end of 2017, Algeria had a GDP of about US$170 billion. But South Africa’s GDP is about US$350 billion. The size of an economy does not correlate to its gold reserves."
        "Therefore, step back a moment and abandon this old world mercantilist idea of what is behind the wealth of a nation, which was more Phyisocrat than Adam Smith. Your labor is not worthless. Each of us constitutes the wealth of a nation. America has the greatest economy, NOT because of gold, but because we have the biggest consumer market on the planet to which everyone tries to sell goods in order to take home money."

        Armstrong definitely slips up here, "total productive capacity of its people." AND "biggest consumer market" He can NOT equate consumer with producer. Machines are not consumers. Consumption is still here but, production has gone elsewhere. Consumption is supported by runaway credit creation, NOT by wages.

        "Money is the perception of the wealth of a nation, which is its total productive capacity of its people, and not its gold reserves or tangible resources. Russia has tremendous natural resources, but its economy is dominated by oligarchs who have prevented Russia from expanding as China has shown the opposite. The fluctuations in currencies are how capital votes on the confidence of the political state behind each currency."

        This is just plain wrong. Russia has refused to blow a giant credit bubble.
        9/19 While the Fed has no ‘guts,’ the PBOC is on steroids – Bloomberg
        Russia refuses to blow a bubble and, has no government debt.
        China has runaway debt. Armstrong is premature. China will be in revolution and, Russia will NOT.
        Armstrong is simplistic on this account. Huge amounts of productive capacity have moved out of America. Automatic machines do most of the actual productivity. 96 million Americans of working age are not in the labor force. The U.S. dollar may very well be backed by our productive capacity but, all the products must be sold. The consumer base of 16 to 62 year olds is shrinking. Much of the productivity in America is absorbed by the war industries to be blown up (consumed). That is why the Pentagon gets so much. funding. Legitimate consumption is FAR below productive capacity.
        Massive debt creation is funding consumption in America. ALL the markets are close to blowing up. If additional debt creation is not forthcoming, consumption will crash WAY down. The idea of MMT and UBI is to get consumption going again.
        The dollar may very well be backed by our productive capacity but, that capacity has been falling for years.


        • Where to interest rates and money creation?

          Notes on public debt;
          Italian government bonds make up 20 per cent of its national banks total assets — one of the highest ratios in the world — according to the Bank for International Settlements.

          FRANKFURT (Reuters) - An obscure clause in government bond contracts may help the European Central Bank clear a key hurdle to launching a fresh stimulus programme by allowing it to own even more government debt, according to central bank officials. But after hoovering up 2 trillion euros (£1.8 trillion) worth of public sector bonds in the past four years, the ECB
          The Euro's $2.7 Trillion Italy Problem - Bloomberg

          The BOJ holds about 50% of public debt,,, about $4.24 trillion

          About $2.8 trillion debt is held by Federal reserve banks

          They tried to unload a bunch of it but, that was deflationary to the general economy.

          Dean Hook, (somewhat dated)
          It is a myth that most of that $14 trillion debt is owed to the Chinese or other “governments”. The vast majority – around $10 trillion – is owed to the Eight Families Federal Reserve crowd.

          In a June 9, 2011 article for Marketwatch, Unicredit’s Chief US Economist Harm Bandholz stated that the Federal Reserve is the largest holder of US debt with around 14% of the total. This does not include debt held by Rothschild-controlled central banks of other nations – including China, Japan and the GCC oil fiefdoms.
          Through the recent QE2 program, the Fed purchased another $600 billion in Treasury bonds. They claimed it was a last ditch attempt to save the global economy from deflation. Instead, the banksters who got the interest free taxpayer-backed money pushed us further towards deflation
          Conversely and inherent in the printing of zero-interest money, they created inflation – speculating in oil, food and gold futures and rolling this increased US debt on the roulette tables at their various wholly-owned global stock exchanges. Is it any wonder the financial parasite class is now clamoring for QE3?
          Thomas Jefferson opined of the Rothschild-led Eight Families central banking cartel which came to control the United States, “Single acts of tyranny may be ascribed to the accidental opinion of the day, but a series of oppressions begun at a distinguished period, unalterable through every change of ministers, too plainly prove a deliberate, systematic plan of reducing us to slavery”.

          A recent report from Standard & Poor’s shows that 40 percent of global sovereign debt belongs to monarchies. However, only 39 out of the 129 countries have a king or queen as head of state, estimated the agency
          The most indebted monarchy is Japan, led by Emperor Akihito. Tokyo owes more than $11 trillion, over 25 percent of the total debt.

          Britain’s Queen Elizabeth II, who is also the head of state of more than a dozen nations within the Commonwealth, has the second-highest debt.
          Despite its large sovereign debt, an average monarchy has three rungs better ratings than the countries without a king or a queen that have an average of BBB to BBB-, says S&P.

          Below is a chart which shows the soaring amount of negative yield government debt. It has recently surpassed $15 trillion.
          More alarming is the amount of corporate debt that has also hit negative yield. Currently there is over $1.2 trillion in negative yield corporate debt.
          Just a few years ago there was virtually none.

          Armstrong claims that there will be a low interest rate for private debt AND, a high interest rate for public debt. He also said that it would be less inflationary fro the GOV to just print the money it needs. The appeal of MMT and UBI is that it would be painless for GOV.
          If the U.S. treasury originated all "money" creation, the banks would be mostly knocked out of business.
          Trump is stepping on the toes of a lot of rich people. Can he wrest control of "money printing" away from the bank cartels? Can he tell the holders of public debt to go piss up a rope?

          9/21 Goldman Sachs says the market is about to get wild in October – CNBC
          Remember; the higher the volatility, the higher interest rate the money renters demand.
          9/21 Illinoisans on hook for more than $18,000 per person in public pension debt – Newsbug
          Not the ones who bailed out and moved to Florida
          9/21 Bankrupt Illinois cities forced to cut services to fund pensions – Mish
          This has only just barely started
          9/20 Fed chairman fails to answer whether Wall Street banks are too big to manage – GATA
          9/20 Interest rate derivatives trading explodes to $6.5 trillion/day – Wolf Street
          Ah yes,,, the volatility

          9/20 India launches MMT: Stocks soar after surprise central bank-funded tax cut – ZH
          Yep, just print the money for GOV
          9/20 How the Houthis overturned the chessboard – Saker
          Ah yes, asymmetric warfare is now available to the little guy,,, just like hacking

          Kunstler on Pocahontas
          " doubt she could FDR her way through it. America back then still had plenty of everything except cash money. Lots of oil, ores, factories, and well-regimented workers. Now we’re officially $22 trillion in debt. The remaining oil costs so much to get out of the ground it’s bankrupting the oil companies. The ores are gone. The factories stand in ruin. And the workforce has degenerated into various mobs demanding something for nothing. The coming disposition of things will be less a depression than a long emergency of permanent contraction, and even Ms. Warren’s zesty grandmotherly charms may not avail to preserve the civil order under those conditions."

          "everything except cash money."
          Big, Bad, Bald Ben Shalom Bernanke claimed that the FED caused great depression one because it did not pump enough money into the economy. QE has been ongoing for 10? years now. We are still sliding DOWN. At some point, it will become even more obvious that pumping money into the banks to loan to the producers is just not working.
          The proposal is to give free money to the lower loop instead of the bankers.
          there will be a lot of blood in the streets before that happens.


          • Volatility, liquidity,,, credit derivatives

            " from the economy to geopolitics to the natural world — things are swiftly worsening.
            Public perception is beginning to shift from complacency to fear. Countries are fast rejecting globalization in favor of nationalization. The holes in our ecosystem — vanishing birds, insects, amphibians and fish stocks — are becoming frighteningly obvious. The threats to life as we’re accustomed to it are becoming more visible while accelerating in both magnitude and frequency."
            " from the economy to geopolitics to the natural world — things are swiftly worsening.

            Public perception is beginning to shift from complacency to fear. Countries are fast rejecting globalization in favor of nationalization. The holes in our ecosystem — vanishing birds, insects, amphibians and fish stocks — are becoming frighteningly obvious. The threats to life as we’re accustomed to it are becoming more visible while accelerating in both magnitude and frequency."

            "What a nightmare it’s been over recent months for those attempting to hedge interest-rate risk. After trading to 4.10% in November, benchmark MBS yields were down to 3.02% near the end of March. MBS yields then rose to 3.34% in April, before reversing lower to trade all the way down to 2.51% by late June. Yields were back up to 2.91% in mid-July – only to then reverse to a three-year low of 2.30% on September 4th."
            Volatility writ large
            "“The Federal Reserve Bank of New York will offer to add at least $75 billion daily to the financial system through Oct. 10, prolonging its efforts to relieve funding pressure in money markets. In addition to at least $75 billion in overnight loans, the New York Fed… will also offer three separate 14-day repo contracts of at least $30 billion each next week… On Friday banks asked for $75.55 billion in reserves, $550 million more than the amount offered by the Fed, offering collateral in the form of Treasury and mortgage securities. The Fed’s operation was the fourth time this week it has intervened to calm roiled money markets."

            Dumping Treasuries and MBs for cash.
            "If risk suddenly becomes an issue for this shadowy network, the cost and availability of Credit for highly leveraged players is suddenly in question. And any de-risking/deleveraging at the nucleus of the global financial system would pose a clear and present danger for sparking “risk off” throughout Credit markets and financial markets more generally."
            "The Fed’s return to system liquidity injections after a decade hiatus received abundant media coverage. "
            "$18 TN of global investment-grade bonds traded at negative yields, including European corporate debt. " INVESTMENT GRADE
            " While a deficient indicator of system liquidity, it’s still worth noting M2 “money” supply has expanded $560 billion over the past six months. Money market fund assets (retail funds included in M2) are up $350 billion since the end of April. Where’s all this “money” been coming from?"
            "Bond markets have turned unstable – on both the up- and downside. Long/short strategies have been bludgeoned. "
            "rom the Fed to the ECB to the BOJ. Is monetary stimulus the solution or the problem?

            Autumn is set up for some serious instability. There’s all this talk of the need for the Fed to create additional bank reserves. The issue is not a shortage of reserves but a gross excess of speculative leverage. It started this week. The Fed’s balance sheet will be getting much bigger."
            Yes but, they want to shrink it. Apparently, many players are dumping treasuries and mortgage backed securities.

            "repo deep freeze as it has now been abundantly clear that the US financial system will need about $400BN more in reserves,"
            "New York Fed president John Williams, who earlier this year unexpectedly fired not only the head of the NY Fed's markets desk, Simon Potter, arguably the most important trader in the world, manning the world's most important trading desk but also the second most important person at the NY Fed's "Plunge Protection Team", the head of the Financial Services Group, Richard Dzina,"
            "New York Fed is examining "why banks with excess cash failed to lend to the overnight money market,"
            "Fed officials have said it's not their fault, and instead have focused on the role played by banks, or rather the role banks with excess liquidity did not play but stepping into fund their liquidity-challenged peers.

            Specifically, Williams and Lorie Logan, senior vice-president in the markets group at the New York Fed, said officials were looking at why cash failed to move from banks’ accounts at the Fed into the repo market, where banks and investors borrow money in exchange for Treasuries to cover short-term funding needs."
            OK, so we're in a big liquidity shortage. Some of the banks have cash,,, some don't. The repo market froze up because the banks with cash held on to it. This happened before in the LIBOR markets. As things get more volatile, more banks will refuse to offer funds to the overnight market.

            Armstrong cautioned the founders of the EU that no currency union had ever survived unless they had a debt union. "They" said that Germany would NEVER agree to take on the debts of southern Europe. Now, "They" are saying that Germany will have to reluctantly agree to take on those same debts. Is it any wonder that Germany is looking to dump the EU and, pair up with Russia?

            They are finally getting serious about putting bankers in jail.
            9/21 Goldman Sachs says the market is about to get wild in October – CNBC
            9/20 Interest rate derivatives trading explodes to $6.5 trillion/day – Wolf Street

            Somebody is going to get burned. It might all depend on the flap of a butterfly's wing,,,, or a tweet.
            Or even a hurricane.


            • Failures mounting,,confidence melting

              "looking at why cash failed to move from banks’ accounts at the Fed into the repo market, where banks and investors borrow money in exchange for Treasuries to cover short-term funding needs."
              and is trying to figure out why they did not hand out their cash to other banks that were in desperate need for liquidity," "why they refused to do so even though any such loan would be perfectly collateralized by money-good securities such as Treasuries, MBS and Agency debt and they refused to do it when repo rates had soared as high as 10%, "
              "one possible explanation: the banks that should have lent out cash did not do so because they were afraid that i) the borrower would not be able to return the cash on the next day and ii) any potential failure in the banking system would lead to a collapse of the repo system, potentially making their ultra-safe collateral, impaired if not worthless. Hence, their desire to hold on to cash... and dear life."
              Confidence is replaced by fear.

              Reportedly, volatility is going to go crazy in October.
              "stock volatility has been 25% higher in October on average since 1928, according to Goldman."
              ALL the big crashes have hit in October.

              Thomas Cook has collapsed leaving thousands stranded.
              The ECB will have to mutualize all sovereign debt.
              This means screwing over the Germans. And, how do they p[land to screw the Germans?
              Armstrong, "In Germany, the Federal Minister of Research has said that the introduction of a special tax on carbon dioxide is virtually certain. Global warming research is funded by governments in order to raise taxes. They refuse to fund any research to the contrary because this is all about raising taxes. Germany will soon join Canada who imposed a $1,000 tax per home. Of course, where does this money go to stop their claimed global warming? "

              Major Bank to Governments: Go on, Give us your Carbon Tax Money…
              Mobilizing the Billions and Trillions for Climate Finance
              Climate change is potentially a $7 Trillion dollar money maker for bankers
              A carbon tax is the nudge the world needs | Financial Times
              What a surprise.

              Armstrong; "The constant intervention of the Federal Reserve into the REPO market is the result of a global dollar shortage on a monumental scale. There is a liquidity crisis unfolding as CONFIDENCE is collapsing in Europe and Asia. The Federal Reserve has been intervening into the REPO market in a desperate effort to maintain its lower target on interest rates."
              "Despite the fact that early in 2019 the headlines were that foreign governments were dumping US debt spinning this into stories that the dollar would crash. In reality, selling of US debt at that point in time was an effort to stop the dollar’s rise. However, as the world economy continues to implode going into the bottom of the business cycle as measured by the Economic Confidence Model, exactly the opposite has been taking place."
              "As more and more US debt is taken up overseas as a hedge against the rising risk of the punitive sanctions of canceling foreign currencies as Christine Lagarde is preparing to take charge of the European Central Bank in October, the panic into the dollar assets is removing US debt from domestic holdings resulting in a LIQUIDITY CRISIS beyond anything you will find in the traditional economic textbooks."
              "So welcome to the new world where economic theories are crumbling before our eyes and falling to the floor as dust in a world that no longer exists. We are entering a new period of reality where whatever you thought was happening may prove to be the opposite."

              Armstrong, "It is like a trader who cannot understand the thinking process of a non-trader, and likewise the non-trader cannot understand the actions of a trader. Then there is the institutional trader. He has to answer to a board that has no concept of trading and they are supposed to oversee the trading division."

              Bloomberg writes about "helicopter money"

              9/23 ECB’s new interest rate policy “as long as it takes” huge failure already – Mish
              They just can't understand why investors run away from hyper-sonic printing presses.
              9/23 Booming securitized loan market has echoes of financial crisis, BIS warns – Reuters
              We've seen this movie before. Hopefully, this time the bankers will be jumping from TALL buildings.
              9/23 South Korean exports collapse 21% – biggest drop in a decade – Zero Hedge
              9/22 Massive price reversion may be days or weeks away – Technical Traders
              9/22 How the Fed’s funding struggles highlight the fragility of Wall Street confidence – MW
              9/22 Look out bears! Fed new QE now up to $165 billion – Phil’s Stock World
              9/22 Massive price reversion may be days or weeks away – Technical Traders
              9/22 How the Fed’s funding struggles highlight the fragility of Wall Street confidence – MW

              It seems that hard times have created quite a market for sugar-daddies,

              9/19 IBM will soon launch a 53-qubit quantum computer – Tech Crunch
              9/23 Google’s “quantum supremacy” to render all secrets breakable – Summit


              • Damn, my long post just got zapped.
                Things are a mess


                • Desperation everywhere,,, especially for Dems

                  Socialism is the firewall between the non-producers and,,, Darwinian pressures. Democracy is socialism-lite and, always, eventually breaks the bank. What happens when computers displace so many productive workers that all that is left is parasites?
                  At one time, bankers did an expert appraisal of the moral and financial qualifications of a prospective borrower / enterprise. In return, they received a fee. At one time, the State guarded the liberty and prosperity of the people in it's domain.
                  The current arrangement is; the bankers and the State are pure parasites with very little regard for the actual producer. This is nothing new and, generally continues until the system blows up. The manipulators grow rich and, the producers grow poor. The beggars, bankers and bureaucrats greatly outnumber the producers.
                  As crony-capitalism robs the producer, socialism starts to look more attractive.

                  America was founded as a democratic republic to try to find a balance between fascism and democracy. Creating the federal reserve gave fascism a big boost. The balance necessary to preserve a democratic republic suffered greatly in the drive to create an American empire. Fascism has run it's course and, the treasury is just as empty as it would have been under socialism.
                  Our faux democracy gets the blame.

                  Democracy Doomed the Money System By Bill Bonner September 19, 2019
                  "But most of America’s $72 trillion in debt cannot be repaid. It was used to buy consumer items – tuna sandwiches, vacations, automobiles, pills – and to pay for the feds’ many boondoggles – drones, surveillance, and giveaways.
                  There is no investment return from this kind of spending."
                  Not one mention of war.
                  "And since it was a consumer-based expansion rather than a capital investment boom, there will be no stream of income flowing from it to pay off the debt."
                  Yes, the military consumer has a budget of $1 trillion a year but, strangely has misplaced $23 trillion.

                  "Democracy is a scam. The plain people vote. But insiders – the elite, the cronies, the Deep State – make the important decisions. And these few can increase their own wealth and power only by taking it from the many they are meant to serve – the public."
                  No mention of the israeli lobby controlling the district of corruption.
                  "Meanwhile, inflation does little for real wealth. Producing businesses, measured by the Dow 30 – the flower of American capitalism – were worth $11,500 in January 2000. Today, those stocks will cost you $27,000 – barely a 2.4-times increase.

                  You would have made twice as much in capital gains from low-risk gold as from high-risk stocks over the last 20 years."
                  American war protesters were shot and killed at Kent State University. It wasn't democracy that gave us unending wars.

                  "Negative interest rates are just the latest front in the post-2008 era of "extraordinary" monetary policy. They represent a Hail Mary pass from central bankers to stimulate more borrowing and more debt, though there is far more global debt today than in 2007. "
                  " Demand-side stimulus is the mania bequeathed to us by Keynes, or more accurately by his followers. It is the absurd idea, that an economy prospers by consuming and borrowing instead of producing and saving. "
                  Riigght Demand-side stimulus when wages are crashing
                  "Marxists think interest payments represent exploitation by capital owners lending to needful workers. The amount of interest paid in addition to the capital returned was stolen from the debtor, because the lender did not work for it (ignoring, of course, the capitalist lender's risk). "
                  Right, the CBs pumped in $247 trillion but, the lender "worked" for his money.
                  "Austrians stress the time element of interest rates, comparing the lender's willingness to forego present consumption against the borrower's desire to pay a premium for present consumption."
                  Warren Buffet has $72 billion in the bank. Just what kind of present consumption did he forego?
                  "Our job, among many, is to bring the insights of Austrian economics on money and banking to widespread attention before something truly calamitous happens."
                  The canary has died and, the horse has left the barn.

                  Mainstream Media Claims Middle Class Isn't Shrinking (By Redefining What It Means To Be 'Poor')
                  Theology Students Confess "Climate Sins" While Sitting In Front Of A Bunch Of Potted Plants...
                  Billionaire Hedge Fund Manager Paul Singer Hedges Against Upcoming Market Crash
                  UK's Thomas Cook Collapses After Rescue Talks Fail; 650,000 Travelers Stranded
                  Rabobank: There Won't Be A Trade Deal Breakthrough As China Would Have To Change Its Entire Economic Model
                  The Disconnect Between The Markets & Economy Has Grown

                  "With 1/5 of incomes dependent on government transfers, it is not surprising that the economy continues to struggle as recycled tax dollars used for consumption purposes have virtually no impact on the overall economy."

                  Chinese Firms Dump $40 Billion In Global Assets, Turn Net Seller For First Time In Decades
                  Raising cash
                  Karl Denniger.

                  "I have a new theory about where the 2020 election is heading: if the Democratic Party candidate happens to lose, the party’s lawyers will unleash a blizzard of litigation in every voting district where the outcome was a couple of thousand ballots against them. It will be the 2000 “hanging chad” fracas on steroids and they will go so far as render the election inconclusive, therefore provoking the most parlous constitutional crisis since the start of the Civil War. In other words, they will dare to disable the republic."

                  "Something or somebody will have to put a stop to these seditious turpitudes. The machinery of the law must be turned on the “resistance” and its operatives in the Deep State. Mr. Barr has the opportunity to do that. A globe of silence has enclosed his doings for many months. Impatient observers jump to the conclusion that the silence means he is doing nothing. I am not so sure of that. Given the purposeful hysteria ginned up so dishonestly in the press — and so injuriously to the actual public interest — don’t you suppose he would want to avoid tossing dynamite into that dumpster fire? By the same token, those actively stoking the dumpster fire are revealing their utter desperation. The unexpected consequence will be the suicide of the Democratic Party. But then people don’t necessarily get what they expect, they get what they deserve."

                  9/23 Forget stocks – money market is signaling possible troubles ahead – Forbes
                  9/23 Stock market’s eerie parallels to September 2007 should raise recession fears – MW
                  9/23 Thomas Cook’s liquidation wipes out travel company worth £1.85 billion – MW

                  A new form of war;


                  • Ending the possibility fo war between eastern and Western Europe

                    Seldom, do you see an article that has over one paragraph of actual information. Here is an article that is exemplary.
                    Remember that Keynes advocated for perpetual war to keep the economy stimulated. Post- Hiroshima, it became too destructive and dangerous to have perpetual war. The cold-war was born as a way to stimulate the economy without risking global irradiation. When the U.S.S.R. collapsed, a new bogeyman had to be found to justify an arms buildup. "They" couldn't allow peace to break out.
                    NATO had been created to counter a Russian invasion. Russia /USSR was never in any position to invade anybody. The war hawks pushed the expansion of NATO until it was on the border of Russia. They tried to provoke a war over Georgia and Crimea. This didn't work because the people were ethnic Russians.
                    NATO clearly had no purpose other than invading Russia.

                    Well, globalism is crashing. The permanent stimulus of a war economy has broken the bank. America has long sought to prevent a natural, mutually beneficial cooperation between Russia and Germany. THAT is exactly what is unfolding. Europe is trying to get away from the post-war American control. This is made especially difficult because the European Union is crashing. The atomic bomb brought peace to a destroyed Europe for long enough for them to integrate their economies to the point where war is no longer a workable position in western Europe. There is a very heavy integration between Russia and Germany. If things continue like this, there will be NO viable way to have a war betweenEastern Europe and Western Europe.

                    MSM and their handlers are hard at work to prevent peace with Eastern Europe. War with Russia is much preferred. "They" are furious with Nordstream because it would/will bring economic cooperation between Eastern and Western Europe. Cooperation leads to peace and, peace must be avoided.

                    Meanwhile, there is little recognition of the base problem.
                    AI Will Take People's Jobs But 'Can Be Leveraged to Create Whole New Economy', Conference Told

                    Automation And The Crisis Of Work

                    There might be a Whole New Economy but, it won't have very many wage-earners.
                    Roofing Drone Perfectly Nails Down Shingles Human Jobs Slipping Away To Hi-Tech - Vid
                    The article goes on to say that people who are displaced can find more interesting work.
                    Historic House Vote Approves Broad Marijuana Federalism
                    TONS of cash floating around and, the growers were prevented from depositing it in the banks. What did you think would happen?
                    They are trying to lock up all the cash from carbon credits. Pot cash is a natural.

                    9/24 Billionaire hedge fund manager hedges against upcoming market crash – ZH
                    9/24 Jim Welsh – Fed cuts to oblivion – Market Sanity
                    9/24 US will follow Germany, eurozone, China into recession – Mish

                    NO mention of Japan where GOV debt is 240% of GDP
                    9/24 The Fed’s $400 billion plan to bailout the repo market – Fortune
                    Still pumping money into the upper loop.
                    9/24 Draghi says ECB should examine new ideas like MMT – Bloomberg
                    Draghi is leaving and, Lagarde is strict austerity. Even now, it is too late to save the Eurozone.

                    9/24 The coming currency war: digital money vs. the dollar – GATA
                    It is digital money vs the CBs
                    9/24 Solar investment plunges amid panel glut – Oil Price
                    9/24 This “anti-solar panel” could generate power from darkness – Oil Price

                    9/24 A half-decade late, NY Post admits ISIS is run by NATO member Turkey – Zero Hedge
                    No mention of israel and Saudi Arabia and Great Britain.
                    Last edited by Danny B; 09-24-2019, 03:50 PM.


                    • Accelerating the slowdown

                      MSM has to turn a profit to stay in business. Alternative media does NOT,,, for the most part. Zero Hedge gets lots of contributors who are experts in a given field. Charles Hugh Smith, for example, asks for $5 a month from contributors. Most of the writers at ZH have some other business or some other income. If you are NOT being paid to write, there is little outside pressure. ZH has writers who are very much on top of things. Not wanting to burden you with too much reading, I try to stick to headlines and blurps.

                      The Latest Numbers Tell Us That The Global Economic Slowdown Is Accelerating Dramatically
                      Economists are already predicting “the world’s lowest growth in a decade”, but it is beginning to look like what we will be facing will be much worse than that...
                      Tesla Involved In Deadly Las Vegas Collision Continued Driving And Hit Four Nearby Pedestrians
                      "Police in Las Vegas are investigating a Tesla that ran a red light and caused a deadly crash "
                      So, who do you sue for wrongful death?
                      Central Bankers' Fatal Conceit: "The Goldilocks Syndrome"
                      "They actually believe that if they tinker enough, they can come up with a policy that will work “just right”"
                      They are trying to get rich without working and, so far, it is working.

                      Community Outraged After City Shuts Down Farm-Stand Run By Preschoolers
                      "It’s like something out of The Onion: city manager shuts down preschool farm stand out of fear that, if allowed, “we could end up with one on every corner."
                      Risk happens fast, especially when markets run on hopium with extended valuations.

                      How fast?
                      WTI Extends Losses After Second Weekly Surprise Crude Build
                      WTI hovered around $57 ahead of the data, and extended the day's ugly losses after API reported the second weekly surprise build in a row...

                      But, but, the frackers need a higher price.
                      "That's The Greatest Risk" - Head Of World's Largest PE Firm Warns Of "Asset Bubble Reckoning"

                      "Billionaires Shouldn't Exist": Bernie Proposes Tax To Cut Billionaire Wealth In Half
                      "Sanders’s plan to tax accumulated wealth, not just income, is particularly aggressive in how it would erode the fortunes of billionaires."
                      Cryptos Are Collapsing Led By Altcoin Bloodbath
                      "Unclear on what the catalyst could be, if anything news-wise, but cryptos are collapsing across the board with altcoins leading the plunge..."
                      Foreign Buyers Surge In Blistering 2Y Treasury Auction
                      Complementary to this article, you must read an article from Armstrong regarding capital flows.
                      "The 1989 Bubble top in Japan was so severe like 1929 BECAUSE it had attracted capital from around the world which intensified the rally. But when the foreign investors sold, Japan crashed and burned because nobody understood the consequences of capital flows.
                      Even when the CIA came to us and wanted me to build this model for them and I declined, they understood we invented capital flow analysis and it was the key to the rise and fall of nations."

                      Insider Selling Hits 20 Year High As Stock Buybacks Soar
                      "Executives across the US are shedding stock in their own companies at the fastest pace in two decades, amid concerns that the long bull market in equities is reaching its final stages."
                      This is very interesting Armstrong sees capital flows continuing to lift the stock market.
                      Bitcoin Tumbles After Network Hash-Rate Mysteriously Flash-Crashes By 40%
                      Dollar Funding Shortage Accelerates As Both Overnight And Term Repo Oversubscribed
                      The banks are crying POOR and, dumping risky paper back to the FED.
                      'Work Less, Make More': Labour Party Introduces Plan For 4-Day Work Week

                      "...Millions are exhausted from overwork..."

                      Eat less and, live on the street.

                      "The Dam Could Break On Thursday": Here Are 12 Quotes That Signal Democrats Are Primed To Impeach Trump
                      It looks like they are really going to do it...

                      That whole Biden / Ukraine thing has caused a collective cerebral Aneurysm in the Dem party. They have shown their true colors. They hate anybody who is anti war.
                      Family investment offices are stashing $trillions to protect it AND, buy up everything after the crash.
                      It's just not that simple. If Armstrong is correct and, the crash is in sovereign bonds, the government will have to stop consuming. That leaves the public to do all the buying and consuming. That isn't going to happen at a global mean wage.

                      9/24 Four collision courses for the global economy – Nouriel Roubini
                      9/24 Student debt hits a depressing $1.5 trillion. Where do we go from here? – MB 360
                      9/24 Negative interest rates in the United States: not any time soon – Forbes

                      They lie about the inflation rate so that they can claim that interest rates are not negative.:wall
                      9/24 BOJ’s Kuroda expounds on virtues of negative rates – Bloomberg
                      I'm sure that it was a very short speech.

                      9/24 Scared central banks face up to threats from climate change – Bloomberg
                      Hopefully, they will all commit suicide.
                      9/24 Why is most of the media circling the wagons to protect Hunter Biden? – NY Post I have no idea.


                      • Comes the tribulation, riding on the back of automation

                        We are approaching a drawn out showdown between communism and fascism,,,, masquerading as crony capitalism. The problem has been brought to a crescendo by the inroads of automation. Boston Dynamics has an untethered robot that can do a gymnastics routine.
                        It is a world for humans but, what niche will the humans have? The communists and redistributionists both have a point. The money renters want their niche to continue on undisturbed. The parasitic loads on the State grow as more politicians give more promises for more votes. Productive capacity grows but, the number of productive employees is shrinking. The operating system of capitalism is unsuited for an automated economy. Mankind is NOT suited for a life of leisure. The whole world is thrashing around trying to find an accommodation for a fast growing population of people who have no productive niche.
                        The family structure has been destroyed by the bankers. Mental health is suffering greatly. Too many people are cast adrift from family and society. Everybody who has a niche wants things to continue as is,,, even though technology guarantees that it WON'T.

                        I need to heavily quote Armstrong. I have faulted him because his database could not have a long baseline for automation,,,, birth control,,, instant capital transfer,,,,,, forced immigration to destroy tribal continuity.
                        Armstrong seems to think (MAYBE correctly) that the computer can project the future without a baseline.

                        REPLY: This is what I have been saying. You cannot forecast something you have never witnessed that has not taken place before. It takes a computer with a vast database to see things unfold according to historical patterns, but in markets that event has never existed before.
                        Sorry, I need to do a lot more cites from him.
                        “When you see that in order to produce, you need to obtain permission from men who produce nothing; when you see that money is flowing to those who deal not in goods, but in favors; when you see that men get rich more easily by graft than by work, and your laws no longer protect you against them, but protect them against you. . . you may know that your society is doomed.”
                        Here, Armstrong agrees with Ayn Rand in condemning fascism but, much of the rest of the article condemns socialism. Condemning socialism is a natural for capitalists but, they have NEVER offered an alternative or cure for automation. They suggest "retraining"

                        They cannot survive without trying to live off of other people’s money. What happens when the productive class refuses to produce? When “Atlas Shrugged,” it all comes crashing down.
                        Keep them poor enough and, they can't refuse to get up and go to work.
                        “Atlas Shrugged” has been ranked as #2 in the most influential books just behind the Bible. People like Bernie Sanders and Elizabeth Warren refuse to listen. They want to create utopia for themselves, convert the productive class into slaves, and expect them to work without enjoying the fruits of their own labor.
                        So buckle up. We are going to witness things many never even thought were possible. This may be the real confrontation between good & evil.

                        Sorry, it just isn't that simple.

                        I mean what I say that the central banks are TRAPPED!!!!! People have NO IDEA what we face. The system is unraveling but not even those in government have understood how it was interwoven to begin with. This is all part of how we are heading into a major Monetary Crisis Cycle
                        The system started unravelling when the first computer was used in business.
                        If you just play out what has taken place in socialism, there will be $400 trillion of unfunded liabilities by the time we get to 2032.
                        Denominating everything with a $$$$$$$$ sign is the problem. Is there a $ value to a new baby? EVERYTHING comes to a crashing halt without babies.
                        Governments have functioned on vote for me and I will rob someone else for you legally with a pen. This is how ALL Republics die. The very purpose of civilization was that coming together created a synergy that was beneficial for all. When government has always turned against one class for the benefit of another, the purpose of civilization ceases to exist
                        Armstrong decries socialism when it was fascism (brought on by regulatory capture) that makes socialism attractive.

                        Armstrong The entire climate change issue has become a covert means in this final confrontation between the left and the right. This is the very issue that will destroy the Western Society for it has been elevated to such heights and governments love it for all they see is more power and money. The activists behind the curtain are simply Marxists who are determined to make communism work one more time.
                        This truly isn't accurate. It is the banks that want the carbon-credits money. It is the blob state bureaucrats that wants all the wage and pension money to continue.

                        "There has been some talk about a “monetary reset” in the future, how do you see it play out and what role do you think precious metals could have if there is a reset?"
                        Armstrong; ANSWER: There will NEVER be such a reset that returns to a gold standard. There is absolutely no likelihood of that happening, for it would mean that socialism has come to an end. There could be no unfunded promises, pensions, etc. It is just total nonsense.
                        The reset will be in the bond market, NOT in currency. UBI will be the centerpiece of the reset.
                        Moreover, absolutely EVERY attempt to fix or peg currencies throughout the centuries has FAILED!!!!
                        BONDS, BONDS, BONDS
                        Bretton Woods and the gold standard failed because they tried to fix or peg the dollar to $35 an ounce of gold, but then they spent freely and waged the Korean and Vietnam wars.

                        9/25 China’s hottest startups struggle for cash amid trade war – Bloomberg

                        9/25 What has frightened Wall Street banks from lending in the repo market? – PSW

                        That is what happens in a liquidity crisis.
                        9/25 Forty states in the U.S. do not have enough money to pay their bills – Forbes
                        That is what happens when the blob state votes for high wages and high pensions.
                        9/25 Peoria residents face new property tax fee devoted entirely to pensions – IP
                        9/24 Insider selling hits 20 year high as stock buybacks soar – Zero Hedge
                        9/24 Draghi open to MMT and a people’s QE – Mish

                        That's what happens when you have a liquidity crisis.

                        9/25 Bitcoin, ethereum, ripple’s xrp, and litecoin in shock meltdown – Forbes
                        9/24 Bitcoin falls sharply as litecoin suddenly crashes – Forbes
                        9/24 Bitcoin network hash rate mysteriously flash crashes by 40% – Coin Telegraph

                        Did you hear that the same thing happened to gold?? ,,, Neither did I.


                        • Still slipping away

                          C.H. Smith; The financial storm clouds are gathering, and no, I'm not talking about impeachment or the Fed and repo troubles--I'm talking about much more serious structural issues, issues that cannot possibly be fixed within the existing financial system.
                          Yes, I'm talking about the cost structure of our society: earned income has stagnated while costs have soared, and households have filled the widening gap with debt they cannot afford to service once the long-delayed recession grabs the economy by the throat.
                          Everywhere we look, we find households, enterprises and local governments barely able to keep their heads above water--in the longest expansion in recent history. This is as good as it gets, and we're only able to pay our bills by borrowing more, draining rainy-day funds or playing accounting tricks.

                          The expansion was a torrent of new money channelled into the upper loop. This money inflation predictably created price inflation that reduced the effective purchasing power of most people.
                          " But asset bubbles always pop, and once they do, the wealth effect reverses and people feel poorer as the value of their homes and portfolios decline. They borrow and spend less, and all the capital gains that boosted local tax revenues dry up, too.
                          Here's reality: wages haven't kept up with expenses. "

                          WSJ "Families Go Deep in Debt to Stay in the Middle Class
                          Wages stalled but costs haven't, so people increasingly rent or finance what their parents might have owned outright Median household income in the U.S. was $61,372 at the end of 2017, according to the Census Bureau. When inflation is taken into account, that is just above the 1999 level."
                          True inflation makes this even worse.
                          "This leaves politicians with one easy way out: borrow enough money to satisfy the demands of every constituency, every clique of insiders and every vested interest. Rather than re-aligning costs with our ability to pay, we're going to use debt to keep all the constituencies happy."
                          oftwominds-Charles Hugh Smith: Financial Storm Clouds Gather
                          Now, Smith is a smart guy. NO MENTION of UBI and channelling debt-free money into the lower loop.

                          Zero Hedge;
                          Day Trading Bitcoin: Why 95% Of Traders Lose Money And Fail
                          Three Suicides On USS George H.W. Bush In One Week Sparks Crisis

                          Sorry for the sailors but, more and more people are seeing war as pointless.
                          "Who Could Have Known?" ...What The Repo Fiasco Entails
                          "...the Fed will have to walk back from their early assurances that the 'exit would be easy'..."
                          The bankers are dumping all their risk assets on the FED. Contagion is making everything risky.

                          One Of The Biggest ECB Hawks Unexpectedly Resigns In Opposition To Draghi's Massive Easing
                          Sink or swim.
                          Desperate Democrats Dig Deep: "Throwing Joe Biden Under The Bus"
                          "Democratic Party members smell something, and they think they’re sure is blood, without ever contemplating it might be their own..."
                          Repo Market Guru: "Whatever Changed Last Week Is Clearly Still A Problem"
                          ""The fact that we’re discussing a quarter trillion dollars is telling as to the depth of the constraint in repo."
                          Von Greyerz: "Whole Financial System Disappearing Into Black Hole"
                          He's a gold guy but, he's pretty sharp.

                          Will The US Become A Socialist Country?
                          " essence, the US is between two-thirds and three-quarters socialist now, depending upon your assessment of what a government should manage."
                          The Fed Created The Everything Bubble And A Liquidity Crisis - What Happens Next?
                          "It is important to realize that the Fed has not “lost control” of the situation... rather, the Fed is perfectly aware of the damage it is causing, and it is perfectly aware of how much this chaos will benefit certain globalist organizations."
                          That has yet to be seen.

                          9/25 As Democrats begin Trump impeachment, key ‘Russiagate’ case may be imploding – RT
                          Shoot yourself in the other foot.
                          9/25 BOJ ready to ease again if price momentum lost, risks grow – Reuters
                          Even Forest Gump would be mystified.
                          9/25 Unprofitable companies rise most IPO cash since dot-com era – Bloomberg
                          I'm sure that all of this will work out fine.


                          • Funding problems as far as the eye can see

                            Negative interest rates are destroying everything they touch. Savers are hurt badly.
                            Ellen Brown explains why America does not need NIRP. She also mentions other problems.
                            "First is the massive market for money market funds, which are more important to daily market functioning in the U.S. than in Europe and Japan. If interest rates go negative, the funds could see large-scale outflows, which could disrupt short-term funding for businesses, banks and perhaps even the Treasury. Consumers could also face new charges to make up for bank losses.

                            Second, the U.S. dollar is inextricably tied up with the market for interest rate derivatives, which is currently valued at over $500 trillion. As proprietary analyst Rob Kirby explains, the economy would crash if interest rates went negative, because the banks holding the fixed-rate side of the swaps would have to pay the floating-rate side as well. The derivatives market would go down like a stack of dominoes and take the U.S. economy with it."

                            Assuming the large-scale asset purchases made at some future date were of federal securities, the federal government would be financing its debt virtually interest-free, since the Fed returns its profits to the Treasury after deducting its costs. And if the bonds were rolled over when due and held by the Fed indefinitely, the money could be had not only interest-free but debt-free. That is not radical theory but is what is actually happening with the Fed’s bond purchases in its earlier QE. When it tried to unwind those purchases last fall, the result was a stock market crisis. The Fed is learning that QE is a one-way street.

                            The FED is, of course, trapped. I believe that "they" prefer formalized UBI over haphazard QE.

                            9/26 Dozens of failed climate predictions stretch 80 years back – Epoch Times
                            Yep, they ignored space weather until Piers Corbyn came along.
                            I do have to mention Jennifer Lawson who was doing space weather work / predictions before everybody else.
                            9/26 First gas station to ditch oil for electric vehicle charging now open – CNBC
                            Tesla Police Car Runs Out of Battery During High Speed Chase

                            Parting gift from Super Mario Draghi,
                            9/26 Euro-area money supply grows at fastest pace since 2009 – Bloomberg

                            9/26 California’s pension debt cannot be ignored – OC Register
                            A decade ago, at Gov. Arnold Schwarzenegger’s request, I supervised a graduate student team that performed a comprehensive analysis of public pensions in California.

                            The goal was to calculate California’s pension debt, the difference between assets and liabilities.

                            The team’s conclusions: the unfunded liability was over $500 billion—seven times the number officially reported. That was in 2008.
                            Based on recently-reported public pension assets and estimated liabilities, that figure is now more than $1.109 trillion, an increase of $56 billion. That translates into $81,300 of pension debt per California household.

                            9/26 SF residents buy boulders, place them on sidewalk to thwart homeless tents – SF Gate
                            But, but, what about sanctuary status?

                            9/26 U.S. business investment much weaker in Q2 than previously estimated – Reuters
                            9/26 Second term repo oversubscribed as funding shortage keeps getting worse – ZH

                            The various private banks are finding more and more garbage to dump on the FED for cash.

                            Why is this important? Because it means that there is a supply/demand shortfall. Multiple banks and corporations need to borrow money on a short term basis to keep their operations functioning. This makes sense; US companies are currently weighed down by more debt than they were before the crash of 2008. The problem is, no one wants to lend that cash to them right now.
                            I wonder why.

                            Warren Buffet's company, Berkshire Hathaway, for example, is holding a record $122 billion in cash. What do Berkshire and other cash heavy companies know that we do not? Generally, companies hoard cash when they are expecting an economic crisis, and, in a way, this cash hoarding can actually contribute to an exponential credit collapse.

                            I assert that the Fed is deliberately maintaining the liquidity crisis while trying to make it look like they are “taking action”. The Fed creates bubbles and then pops those bubbles by tightening liquidity into economic weakness. When they do ease credit conditions, it is almost always well after the avalanche has already started.

                            They did the same thing at the onset of the Great Depression, causing the crash to expand rather than retreat, as Ben Bernanke publicly admitted in 2002. They also kept crash conditions in credit markets hidden when Alan Greenspan shut down all conversation with the public on the housing bubble. And, today the Fed continues to fraudulently claim the US economy is strong and in recovery, and has even fired Simon Potter, the official most equipped to handle a repo lending crisis – the same official that warned the Fed response is basically too little too late.

                            The Fed Created The Everything Bubble And A Liquidity Crisis - What Happens Next?
                            "first by a process of inflation,, then by deflation, the banks come to own everything"

                            The attacks on Trump may very well bring down everything.


                            • Worldwide corruption and failed Marxism

                              In early 1993, the Russian Ministry of Internal Affairs reported there were over 5,000 organized crime groups operating in Russia. These groups were comprised of an estimated 100,000 members with a leadership of 18,000
                              Federation of American Scientists
                              Gangster's paradise: how organised crime took over Russia ...
                              A Tangled Web: Organized Crime and Oligarchy in Putin's Russia
                              Special treatment gives Israeli mobsters free access to US soil .
                              Is Israel becoming a mafia state? | The Times of Israel

                              All criminal enterprises need banks. They need corrupt bankers. Trump and Putin are trying to clean things up. Netanayahooo has been convicted of 3 major corruption charges. His "co- PM" Gantz is a wanted war criminal.
                              Back to Russia;
                              Danske Bank's Estonian branch is at the heart of one of the largest money-laundering scandals, with €200 billion ($220 billion) of suspicious funds flowing from Russia, Moldova, and Azerbaijan, for at least a decade. The amount of money that was transferred was equivalent to 10 times Estonia's GDP, mostly originating from Russia.

                              Netanayahoo is absolutely apoplectic about both Trump and Putin. Their tag-team is cutting into the profits of organized crime. The Russian-israeli crime families would risk thermonuclear (and worse) warfare just to keep the crime families in power.
                              The democratic party is desperate for funds. They have signed up with organized crime to keep the party going. They reek of DESPERATION. This kind of desperation does NOT play well at election time.
                              Organized crime is making a HUGE push to maintain control.
                              Several years ago, there was an Italian prosecutor who went after the Red Brigade. He travelled in a bullet proof limo. Out of desperation, the Red Brigade put 1,000 kilos of explosives in a culvert that the prosecutor regularly drove over. They got him in the end.

                              COMMENT: Every ISM has failed. Maybe we are seeing the twilight of Capitalism.
                              China is a hybrid. Maybe that is why it will be the next world power.

                              REPLY: People confuse capitalism with corruption. Capitalism is your freedom to choose. Corruption is when republics are available for sale to the highest bidder.
                              The central problem is thta it takes lots of money to run a campaign. You have to sell your soul and independence to run for office.
                              "Congress spends 70% of its time selling favors and trying to raise money for the next election. Term limits will end that. It will end the lobbying motto: “Do as I ask and I will fund your next election.”"
                              There is a youtube vid of congress giving 23 standing ovations to Netanayahooo

                              QUESTION: What do you say about the difference between corporate socialism and democratic socialism. Thank you. Its all the buzz among those supporting Senator Elizabeth Warren.


                              ANSWER: This is a very clever way of excusing the core issue. The Democrats preach raising taxes and then sell loopholes to the big corporations. The bankers donated to Hillary — not to Trump. This is a clever campaign assuming, as always, the people (the great unwashed) are just stupid.

                              The Democrats were against the flat tax because it would eliminate lobbying for tax loopholes. But more importantly, if we had TERM LIMITS and one-time-and-gone, that would eliminate lobbying for dangling money before politicians of BOTH parties for favored status.


                              Code orange
                              The coup has begun – The empire strikes back everywhere – Tom Luongo
                              Well, organized crime is everywhere. What do you expect?
                              9/27 Repo meltdown shows budget deficit has limits – Bloomberg
                              The meltdown just shows which securities the banks are unloading because of risk.
                              9/26 U.S. business investment much weaker in Q2 than previously estimated – Reuters
                              And why is this important??
                              US Shale In A State Of "Deep Anxiety", Survey Signals Capex Collapse Imminent
                              CAPEX is capacity expansion. The well-depletion rate for shale is horrendous. If they don't do furious expansion, productivity crashes. Shale has lost $280 billion and counting.

                              The RICO Act as a shot-across-the-bow of criminal bankers. VERY good read. More of the Trump effect of going after EVERYBODY regardless of their power.
                              The coming default cascade is coming onto view like a massive iceberg in the path of the Ship-of-State. The blob State is comprised of people who can do nothing but shuffle papers to each other. Their wage and pension demands have broken the bank in true Marxist fashion. This is NO accident. The Cloward-Piven strategy out of Chicago calls for GOV to be brought down by excessive demands from non-producers. They imagine that a bright new Phoenix will rise up out of the ashes. What will the lefties do when the phoenix fails to appear? You can bet your last bullet that they will blame Trump. Then what?
                              Last edited by Danny B; 09-28-2019, 02:10 PM. Reason: spelllling


                              • Global warming tax ,,,, capital flows

                                Now that global warming has been elevated to a religion, you can bet that money is behind ALL of it.
                                Back in 2010 the head of Working Group 3 of the UN Intergovernmental Panel on Climate Change, Dr Otmar Edenhofer, told an interviewer, “…one must say clearly that we redistribute de facto the world’s wealth by climate policy. One has to free oneself from the illusion that international climate policy is environmental policy. This has almost nothing to do with environmental policy anymore, with problems such as deforestation or the ozone hole.” Since then the economic policy strategy has become far more developed.

                                Make no mistake. When the most influential multinational corporations, the world’s largest institutional investors including BlackRock and Goldman Sachs, the UN, the World Bank, the Bank of England and other central banks of the BIS line up behind the financing of a so-called green Agenda, call it Green New Deal or what, it is time to look behind the surface of public climate activist campaigns to the actual agenda. The picture that emerges is the attempted financial reorganization of the world economy using climate, something the sun and its energy have orders of magnitude more to do with than mankind ever could—to try to convince us ordinary folk to make untold sacrifice to “save our planet.”

                                Marvellous idea
                                Impose a carbon tax on everybody. Use the money to fund the poor so that they can reproduce even more. That will definitely fix global warming.

                                US wasted billions in Afghanistan while China developed infrastructure – and now New York has bumpy roads, jokes Pakistani PM
                                Wadayoumean wasted? The bankers made $billions by creating a vertical market for popie-opium-heroin.

                                9/28 Trump administration deliberates block on all US investments in China – CNBC
                                Kick em while they're down.
                                9/28 The Fed is girding for repo trouble Monday even as market calms – Bloomberg
                                9/28 Metro Bank teeters after bond sale fails. Shares collapsed 95% – Wolf Street

                                95%,,, is that all?
                                Realistically, what’s left to power asset prices higher? – Adam Taggart, Peak Prosperity
                                So, what is left?
                                Armstrong; "Our models based upon reliable source flow data is currently showing that the Eurozone is the NUMBER ONE place in the world with the greatest amount of capital fleeing than any other region in worldwide. This is indicating that the CONFIDENCE in the Euro Project appears to be collapsing "
                                Capital Flows Not Central Banks Are Holding Up US Economy ...

                                Martin Armstrong: How Do Empires Die? Capital Flight, Not Hyperinflation

                                Capital flows