Economic pressures

[Danny B]

ECB bonds,,,State debt = crash

Gold is the governor that keeps the speed of the printing press in check. Gold is the governor that keeps politicians from buying elections. A State normally goes off the gold standard when it is preparing for war.
Human nature and socialism are incompatible. Without incentive, nobody works hard. The ECB is buying lots of bonds to finance European socialism. Without some kind of governor on the printing press, the supply of bonds just keeps growing. Printing debt-free money is anathema to the cBs BUT, if nobody buys the bonds, that is what they get,,,,De-facto debt-free money.

"European Central Bank (ECB) which has meanwhile swelled to 2.3 trillion Euro. There are problems now emerging in Italy and the appetite for government debt at low rates is not as strong as being portrayed. The ECB’s expansive economic stimulus package of buying government debt is NOT going to be stopped so easily.
there are rising concerns that member states will be unable to fund their spending without the ECB or a dramatic rise in interest rates demanded from the private sector."
https://www.armstrongeconomics.com/w...-if-they-stop/

" there is a direct link between government debt levels and the number of financial crises that occur. And since global debt levels are high—the second highest level in the past 150 years—it’s not exactly a stretch to conclude that another financial crisis is coming"
https://s3-us-west-2.amazonaws.com/g...17-goldnew.png
The Root Cause of Current Debt Levels
The simplest explanation is that governments spend more than they bring in. How is it that central bankers and politicians can continue this free-for-all spending? You can tie it to one thing…
That’s 18 major financial crises in 46 years. An average of one every two-and-a-half years.
https://goldsilver.com/blog/history-...nother-crisis/

"Jim says the Chinese have removed all of their dollar exposure via swaps, so China can flush King Dollar down the toilet any time it wants…"
This is quite a big deal. https://www.silverdoctors.com/headli...ollars-toilet/

$278 trillion of interest-rate-derivatives go through clearing houses. Gary Cohn believes that they will be the focus of the next crisis.
Gary Cohn fears clearinghouses could be to blame for the next financial crisis - Oct. 17, 2017

[Danny B]

Shorting Italian debt,,,,gold clearing

Ray Dalio commissioned the guys who built "Deep Blue" to build him a computer program to run his bond business. He has the largest bond fund in the world. Ray has just released his latest bets. He's shorting;
$1.1 billion against the banking system, $310 million against the main utility, $140 million vs pan-European insurer Generali and now $300 million vs the national oil and gas company,
"The EU finances itself on the fly. It’ll have a €254 pile of unpaid bills in 3 years time."
"the EU has liabilities, notably arising from the unfunded retirement benefits of European staff estimated at €67 billion at the end of 2016,"

"Dalio doesn’t call the bluff of Italy, and this is not just like George Soros’ shorting the British pound in 1992, he’s calling out the entire EU and its financial system."
"Dalio’s located the Union’s achilles heel, which is not just that Italy’s insolvent (it’s not alone in that), but that there’s a gigantic theater production being performed to give everyone the impression that things are going just swimmingly"
"Intesa Sanpaolo CEO Carlo Messina may have said that Dalio will lose his bets, but according to the IMF Italy’s non-performing loans levels were €356 billion at the end of June 2016, which is 18% of total loans for Italian banks, 20% of Italy’s GDP and one-third of total Eurozone NPLs"
https://www.theautomaticearth.com/20...the-entire-eu/

10/18 China isn’t fixing its flaws – Bloomberg
10/18 Xi’s deleveraging dream is a China myth – Bloomberg
The West mistakenly thinks that China will / must put on the brakes for credit creation. That was never their intention. Their long-range plan is to come out on top. Jim Willie reports that China has used currency swaps to get rid of the last of their dollars. Russia has just amped up their gold buying.
U.S. debt is reported at 105% of GDP, NOT counting $213 trillion of unfunded liabilities. Russian debt is reported at 18%.
Margin debt is astronomical. Nobody can make good in case of a default. Clearing house debt is a few orders of magnitude larger. There are NO counterparties that can cover a chain of default.
In the case of a default cascade, nobody will trust anybody. At the start, traders will have to put physical gold into escrow until a trade clears. Credit will gradually be revived but, only for parties that have proved themselves trustworthy.
China is in the catbird seat and will quote all prices in gold-ounces, NOT in Yuan.
"For example, average daily clearing volumes in the London Gold Market during January 2017 totalled 20.5 million ounces. That’s the equivalent 638 tonnes of gold cleared per day in London."
The world will revert to barter for large-scale purchases. Credit can not be re-established overnight.

[Danny B]

Bankers revolving door,,, 10 triggers

Here are 2 articles about the revolving door between the finance industry and government.
SEC Hires JPM Banker As Its Most Important Markets Regulator; May Blow Up HFTs | Zero Hedge
https://rantt.com/this-is-why-banker...d-fb0a0ccbb6fb
Even when the banks get a big fine,,,, they are often allowed to deduct it from their taxes.

Paralysis and shutdown may be on the menu, Here Are The Reasons Why Another Government Shutdown Looms | Zero Hedge
NOBODY is filing for unemployment benefits so, obviously, EVERYBODY is employed. Initial Jobless Claims Crash To Lowest Since 1973 | Zero Hedge

According to Bank of America, "we believe sometime between Thanksgiving & Valentine’s Day. We expect >10% correction (say from SPX 2670 toward 2400). Below we list 10 signals of peak Positioning, Profits & Policy stimulus."

Which brings us to Hartnett's "10 Triggers for a >10% correction",
BofA Lists 10 Triggers For The Next Crash: "It's Coming Between Thanksgiving And Valentine's Day" | Zero Hedge

[Danny B]

Crypto fraud,,,, party on

It takes hard work to mine gold. Some mines return as little as 3 grams per ton of ore. Cryptocoins are a different story. How can they maintain their "value" if anybody can conjure them up?
"There is a serious new fraud centering around Cryptocurrencies. There have been some trading platforms set up that are suddenly changing the rules in mid-game. People who have tried to sell things like Monaco Card etc. on these platforms have discovered that their accounts are frozen because they do not have the money to pay people. "

"Cryptocurrencies are no different from any other investment product. It is a misrepresentation that they offer an alternative to the dollar. No matter how much money one made on Bitcoin, they still have to sell it to realize that profit and how are they measuring that profit? In dollars of course.

Beware of the fraud in these trading platforms that are now suddenly freezing people’s accounts claiming security to prevent people from selling particularly the smaller new cryptocurrencies."
https://www.armstrongeconomics.com/m...cies-the-scam/

"Earlier this summer, Tezos smashed existing sales records in the white-hot IPO market after the company’s pitch to build a better blockchain for cryptocurrencies made it one of the buzziest ICOs in the world. As we noted at the time, the company capitalized on that buzz by courting VC firms and other institutional investors with a $50 million token pre-sale. After the company opened up selling to the broader public, demand soared as investors greedily bought up tokens in spite of glitches that threatened to derail the sale early on. By the end of its weeks-long token sale in July, Tezos had sold more than $230 million.

Now, Tezos is proving that authorities in the US and China were on to something when they decided to crack down on the ICO market, which has become a cesspool of fraud and abuse."
The World's Largest ICO Is Imploding After Just 3 Months | Zero Hedge

10/20 Global investors brace for a cruel new world of feeble returns – Bloomberg There are just TOO MANY people trying to rent out their free money. The CBs tried to support / save ALL of them. At the same time that all of this free money was sloshing around, the State borrowed more and more. Globalization wiped out domestic Western economies and the State spent more and more to support those who didn't have a job niche. The State couldn't afford the rising interest burden so, the CB was enlisted to drive down interest rates to ZERO. That made it "possible" for the State to carry even more debt.
All this debt was necessary to maintain the standard of living of the many millions of voters who had lost their jobs.

"The ECB’s caution has its reason because they too fear what is going to happen when they exit from the bond program if they even can. The program has transformed from economic stimulus to a plain outright program to reduce the financing interest rates of the over-indebted Euro-States keeping them on life-support."
"If this support by the ECB is eliminated, the outbreak of a new debt crisis in Europe could send interest rates soaring and a collapse in confidence in government. Therein lies the crisis. Once capital figures out that it is the governments who are in trouble, it becomes Mario bar the door!"
https://www.armstrongeconomics.com/a...tical-markets/

The CBs create debt-bonds for the State but, the taxpayer has empty pockets. While the FED and ECB are loathe to create more debt bonds that can never be repaid, they are joined at the throat with the State. If the central government collapses, what is the fate of the central bank?

US Gross National Debt to Spike by $800 Billion in October? | Wolf ...
https://wolfstreet.com/.../us-gross-...on-in-october/
Aug 21, 2017 - In the two weeks after the debt-ceiling increase, it soared by $520 billion.
So, the FED can talk up a good story about reducing it's balance sheet.

The U.S. GOV / CB creates a new dollar of money for the system. In early days, this new dollar of debt created a few dollars of new wealth. About the mid 60s, this had shrunk until a new dollar of money only created one dollar of new wealth. It now takes as much as five dollars of new money to create one dollar of new wealth. Since the 60s, the FED has been financing consumption rather than wealth creation. The FED might like to extricate itself but, all the beggars, bankers, bureaucrats AND war-mongers want the party to continue. BUT, they want the party to continue for current partiers. That is why the pension systems are not funded.

Presumably, the party will continue until all this wet-ink money no longer flows into State debt markets.

[aljhoa]

Cryptocurrencies are here to stay.


Al

[Danny B]

I click on the link and all I get is

AMERICAN MADE - 'The Real Barry Seal' Featurette
AMC Theatres
AMC Theatres

[aljhoa]

I click on the link and all I get is

AMERICAN MADE - 'The Real Barry Seal' Featurette
AMC Theatres
AMC Theatres

Why Cryptocurrency Is a Perfect Vehicle for Crime


b4rry s34l


Al

[Danny B]

BTC and some kind of new reality,,

Re: Why Cryptocurrency Is a Perfect Vehicle for Crime
It is arguable that the state is the biggest criminal of all. The bankers are probably second. They have completely vertically integrated drug production and distribution. The result,
"Heroin-related deaths increased 439% from 1999 to 2014. As of 2014, heroin-related deaths had more than tripled in five years and quintupled in 10 years."
This is America on drugs: A visual guide - CNN
As long as the bankers and CIA are running the drug business, I'm not particularly worried about criminals using BTC.
How a big US bank laundered billions from Mexico's murderous drug ...
https://www.theguardian.com
Flooring politicians, lawyers and investigators all over the world, the U.S. Justice Department granted a total walk to executives of the British-based bank HSBC for the largest drug-and-terrorism money-laundering case ever. Yes, they issued a fine – $1.9 billion, or about five weeks' profit – but they didn't extract so much as one dollar or one day in jail from any individual, despite a decade of stupefying abuses.

I can easily forget about the threat of criminals using BTC.

Moving on, The articles on the net are getting more and more analytical about BTC. They are getting more and more interesting.
This guy REALLY knows his stuff, "95% of cryptocurrencies are scams."
"First there was barter. Then there was gold. Gold first solved many of the problems of barter (reducing thousands of exchange rates to just a few). Then there was paper money/bank money/fiat money. Paper money solved many of the problems of gold (e.g. as a store of wealth that you can travel with, or as a transaction mechanism for large transactions).

Now there are cryptocurrencies. And cryptocurrencies are solving major problems in fiat money (no centralized control, lack of human error, no forgery, privacy, etc etc)."
"Back to the main point: the $200 trillion in cash, money and precious metals used as currencies in the world will eventually be replaced by cryptocurrencies, which only total $200 billion today."
It just doesn't work that way but, go on.
"Ask yourself, why does the world need multiple currencies? There’s actually no real reason. The only reason we have a U.S. dollar and also a Canadian dollar is that in 1770 the people in Canada decided not to join the U.S. So an artificial border created two currencies. It’s all dictated by artificial borders."
In essence, the borders of a State are defined by/ limited by it's taxing power.
https://dailyreckoning.com/cryptocur...llion-one-day/
If the State changes over to a crypto currency from a paper currency, you can bet that it will want a sovereign CC. The State will do what it takes to maintain it's income.

This brings us to the second article.
"Gold fever” was the Russian central bank governor’s mocking term for the cryptocurrency moment.
Then Russia fought cryptocurrencies…"
The first deputy governor of the central bank:

“We cannot give direct and easy access to such dubious instruments for retail [investors].”
Vladimir Putin himself said cryptocurrencies were the coin of crime, of vice, of terrorism; a cutthroat’s money.
Then cryptocurrencies won…
Russia’s finance minister conceded last week that “cryptocurrencies are a fact of life.”
"Now Vladimir Putin has officially called for a Russian cryptocurrency — the “cryptoruble.”
"Does Russia’s surrender mean we heave the first set into the fire?
Or maybe Russia’s “surrender” isn’t a surrender at all, but a feint… a flanking maneuver so cunning you could stick a tail on it… and call it a weasel."
"Cryptocurrencies war against the largest monopoly in the world — the state monopoly on money.
Why would Russia sign on that dotted line?
Jim Rickards whiffs a rat:"
"Libertarian supporters of blockchain celebrate this lack of government control. Yet I believe their celebration is premature and their belief in the sustainability of powerful systems outside government control is naïve.

Governments don’t like competition, especially when it comes to money. Governments know they cannot stop blockchain — in fact, they don’t want to. What they want is to control it using powers of regulation, taxation and investigation and ultimately more coercive powers, including arrest and imprisonment of individuals who refuse to obey government mandates."
" With Russia and China both embracing the idea of sovereign cryptocurrencies, it’s time to ask a simple question: Why is a technology threatening to decentralize money so attractive to highly centralized, authoritarian regimes?

Answering his own question:

They are trying to figure out how to lower the cost for a centralized issuer to control everything that’s going on in the financial system… The costs of running a monetary system would go down… and transactions would become traceable by governments, above all for tax purposes. "
"That suspicion is our suspicion — and it would explain Russia’s “surrender.”

The fox “surrenders” to the chickens and is marched right into the henhouse.
But we can’t put away another suspicion… the suspicion that cryptocurrencies are the real fox here…"
https://dailyreckoning.com/gandhi-bitcoin-russia/

"As I mentioned at the beginning of the article, retail investors are propping up the markets. However, they aren’t the only ones, or should I say, the only factor in keeping the markets from falling off a cliff. Thanks to Uncle Sam, total U.S. debt has increased by $590 billion in just the past month and a half." That can't be true, QE ended years ago.
"when the U.S. Treasury added another $318 billion of debt on Sept 8th, this propelled the markets higher."
"So, what we have propping up the markets are DEBT and BRAIN-DEAD RETAIL investors."
"The ORANGE line represents SMART MONEY, the institutional investors. Here we can see what a proper investment strategy should be during a rising bubble market when one doesn’t suffer from the same illness as the retail investor. Furthermore, the savvy institutional investor is also able to understand the ramifications of the following chart:"

"Thus, an investor not suffering from BRAIN DAMAGE, (institutional investor), would take this chart as BIG WARNING, whereas the retail investor just wants to know is how quickly he can liquidate his life insurance policy to place an even larger bet in the STOCK MARKET CASINO.

There is no telling how long the stock market will continue to rise as underlying fundamentals deteriorate. However, all markets held up by debt and stupid money, must crash at some point. "
so, the institutional investors are unloading their stuff onto retail investors.

GREAT graphs, "Look for a US Recession entering the news headlines by mid 2018. This is a better than 70% probability based on the CAPE & VIX technicals underlying the historical CAPE/VIX ratio."
https://seekingalpha.com/article/411...g-ahead?page=3

"On Friday the S&P 500 and the Dow and the Nasdaq carved out simultaneous records, marking the 24th time in 2017 that that feat has occurred." GREAT news.
http://www.marketwatch.com/story/sp-...?siteid=YAHOOB

The GOOD news,,, the military budget can continue growing unchecked. The bad news;
“51 Republican Senators just voted to cut Medicaid by $1 trillion and Medicare by $500 billion so that millionaires and corporations can get a tax cut. It’s immoral and despicable.”
http://www.rense.com/general96/senatebudgetbill.html
But, like Killary says, "it was worth it." https://sputniknews.com/us/201710201...ntagon-global/

Canada is finding new ways to help the "poor", https://www.armstrongeconomics.com/w...-wage-earners/

"According to him, “unprecedented amounts, over $20 trillion in cash, was printed and thrown at Wall St. creditors to repair their technically insolvent balance sheets.”

“There was no reform or attempt to reign in the crooked behavior of bankers at all. In turn, they interpreted this as a ‘green light’ to keep doing what they had been doing that led to the crash; namely, engage in extreme, reckless borrowing to speculate.”

A former stockbroker, Keiser said that now in 2017, the debt pyramid has never been higher. “Just one indicator of this would be the sovereign bond market in the US and UK that are trading at multi-hundred-year highs thanks to the Ponzi-economics of central bank debt monetization (printing money and buying back their own debt).”
https://www.rt.com/business/407274-n...monday-coming/

This is a cross post, https://www.silverdoctors.com/headli...h-rotten-frui/

[Danny B]

China following Japan

China, President Xi took over in 2012, knowing that a party congress would occur in 2017.
"Xi and Chinese leadership are battening down the hatches. Recall that less than two years ago the Chinese Bubble was at the brink. It was Xi and his “national team” that took incredible measures to reverse a dynamic of collapsing markets and exodus from the Chinese currency. In short, confronting an inconveniently timed bust, they resorted to stoking their historic Bubble."
"There has been as well a couple more years of historic compounding Credit growth. "
"Credit growth accelerated into the communist party congress. Chinese Total Social Financing (total non-governmental Credit) expanded a stronger-than-expected $277 billion during September. Year-to-date Total Social Financing growth of $2.375 TN is running 16.3% above last year’s record pace. Lending was led by booming demand for household real estate purchases. Total Chinese Credit could surpass $4.0 TN in 2017, easily outdoing U.S. Credit growth at the height of our mortgage finance bubble. "
Credit Bubble Bulletin
President Xi inflated the snot out of credit, planning to survive until he could consolidate his power in the congress.. Here is a graph of actual growth.
http://www.marketoracle.co.uk/images...rowth-rate.png
"For example, the rise of the shadow banking system, which operates beyond the regulations, is worrisome. Its share of total credit soared from 10 percent in 2006 to 33 percent currently, leading to an excessive risk-taking and unjustified valuations of different assets, especially real estate.
Another alarming but linked problem is the level of debt. China’s total non-financial sector debt – which includes household, corporate and government debt – was 242 percent in 2016 "
Chinese Economy and Gold :: The Market Oracle ::
China's real gdp is crashing and, coincidently, China's labor force is shrinking. http://conceptnewscentral.com/wordpr...rs-decline.jpg
Xi is going to have his hands full trying to grow the economy while the population is falling.

[Danny B]

Greed/fear index,,,pensions,,, insurance premiums,,,Kunstler

"The University of Michigan’s Surveys of Consumers have been tracking consumers and their expectations about the direction of the stock market over the next year.
We are now at an all-time high in the expectation that the stock market will go up."
By "we" he means retail investors. The institutional investors have left the scene.
"Only a few weeks ago the CNN Fear & Greed Index topped out at 98. It has since retreated from such extreme greed levels to merely high measures of greed. Understand, the CNN index is not a sentiment index; it uses seven market indicators that show how investors are actually investing. I actually find it quite useful to look at every now and then.

The chart below, which Doug Kass found on Zero Hedge, pretty much says it all. Economic policy uncertainty is at an all-time high, yet uncertainty about the future of the markets is at an all-time low."
It's the Koolaide.
MAULDIN: Investors Ignore What May Be The Biggest Policy Error In History | Mauldin Economics

"Take for example the hundreds of trillions of dollars-worth of underfunded entitlement and pension promises. Those promises cannot be kept and they cannot be paid. Everybody with a basic comprehension of math can conclude as such.

Yet we continue to operate as if the opposite were true. We comfort ourselves that, somehow, all the promised future payouts will be made in full -- even though the funds are insolvent"

Congress approves plan to allow pension cuts (Dec 2014)
273,000 union workers and retirees brace for pension cuts (May 2, 2016)
In unprecedented move, pension plan cuts benefits promised to retirees (Jan 27, 2017) -- note the laughable use of "unprecedented" here
Teamsters face 31 percent pension cut (Mar 7, 2017)
New York State Teamsters pension fund cuts approved (Sept 13, 2017)

"Health care premiums for 2018 set to go up by as much as 50 percent

Oct 5, 2017

Several states have announced rates for health insurance premiums on the Obamacare exchanges for 2018. Topping the list is Georgia, with rates that are 57 percent higher than last year"
"The average family health care insurance premium in 2016 was $18,764"
https://www.peakprosperity.com/blog/...infuriated-yet
As long as the military is well funded, the rest doesn't matter.
"The United States marks the 16th anniversary of the war in Afghanistan. A new report shows the federal government may have misplaced $21 trillion in the last two decades. "
https://www.rt.com/shows/watching-th...s-anniversary/

"Behind all the smoke, mirrors, Trump bluster, Schumer fog, and media mystification about the vaudeville act known as The Budget and The Tax Cut, both political parties are fighting for their lives and the Deep State knows that it is being thrown overboard to drown in red ink. "
Will that be ink or blood?
"Alas, Mr. Trump has not constructed a coherent strategy for defeating the colossus of fakery that drives the nation ever-deeper toward the cold and dark."
"The revolution to come out of this frozen swamp of irresponsibility will be the messiest and most incoherent in world history."
Into the Cold and Dark - Kunstler

More Kunstler, "referring to that the other day. We are entering a slot of time where an awful lot of things might go wrong. What gets me is seeing the stock markets make new record highs every other day, whether Puerto Rico is destroyed overnight or hundreds of people are shot in a Las Vegas parking lot — and notwithstanding the overall phony-baloney condition of the American economy, with half of the flyover population in an opiate daze, and chain-stores shuttering to the tune of 10,000 this year, and car leases expiring into a car market dependent on liar loans bundled into janky securities, and the debt problem festering away like a something dead under the floor boards."
Light It Up - Kunstler

[Danny B]

Bots,,, using the blockchain to combat fraud

Max Keiser does a rant about artificial intelligence wiping out employment in the finance industry. https://www.youtube.com/watch?v=rHgbAh0jgNs
He isn't the only one who sees a future where the best man for the job is a machine.
EquBot has been let loose. The sequence of pictures are priceless.
First A.I. ETF Claims It Can Replace An Army Of Research Analysts | Zero Hedge
AlphaGo Zero will soon make all of our puny efforts look even punier, Google creates AI that can teach itself and 'isn't constrained by the limits of human knowledge' | The Independent

Even captain Kirk had big problems like this, https://www.youtube.com/watch?v=vzuIijxHBh0

Manna, " "Yesterday the people controlled the computers. Now the computers control the people. You are the eyes and hands for this robot. "
Manna, Chapter 1, by Marshall Brain



"That’s the real issue with Keynesianism. The big crash of 1987 was considered a “6 sigma” event, an event so rare that, on a daily basis, you’d expect to see it every few billion years or so. The big Nasdaq crash in 2000 was another 6 sigma event. The big crash in 2008 was another 6 sigma event…all but impossible to believe happened."

"Academia is suddenly worried about somebody teaching heresy in economics."
All those dogs not barking are really bothering me. A university can commit $1,000,000 a year to fight racism in response to a “hate crime” that never happened…and silence. Our universities can have dozens of $250,000 a year vice presidents of Diversity working hard to start riots…and silence. Campuses can spend millions teaching students about deviant sexual practices…and silence. I’ve documented many cases of many millions of dollars being spent on ridiculously detrimental things and my blog is about the only place to complain about the clear misuse of funds…everyplace else is silent.

But set up a department to research a way to prosperity that doesn’t involve enriching the political caste, paid for with money not even coming from the government (though it’s fair to ask where Koch got his money), and 176 admin and faculty complain."

China and Russia;
" If you read the fine print, the Russian government is moving in to tax and regulate it, at a rate of 13% on trades for profit, as well as “Crypto-Rubles” that suddenly appear out of nowhere.

It won’t affect the Black Market as much, because 13% is going to be paid to turn a blind eye to the billions of rubles being stolen by the Russian Mafia and oligarchy alike. The gimmick here is for the government to take a chunk out of it: for now. The reason “now” is being used, is that eventually they’ll shift gears, pass legislation, and eventually outlaw private trading in it that is not government-sanctioned or government-approved."
http://www.shtfplan.com/headline-new...of-it_10202017

China, "For example, if the government plans to subsidize certain farms, say some corn farms, to support this sector of agriculture, they can directly add a certain amount of money to the wallets of some farms, for instance 100 million dollars and program this money to be sent to certain fertilizer merchants at a certain time, and that each can only spend maximum of 10 million dollars per year, and in this way, they can make sure that the farmers won’t squander the windfalls, and that this money won’t flow to other sectors, for instance, the stock market or real estate market."
http://www.zerohedge.com/news/2017-1...-backed-crypto

The Russian example is specifically about taxing.
The Chinese example is specifically about blocking corruption.

"We’re still so early, that much about what people are saying and writing about crypto is more theory than fact. Lots of people (including me) compare the the crypto bubble to the Internet bubble. "
2. Bitcoin Is A Confidence Game, Utility Tokens Are Awesome But Legally Challenging, Security Tokens Are Going To Be Huge
"This post in Blockchain Hub gives a great detailed overview of the three types of blockchains — public blockchains (like Bitcoin and Ethereum), federated blockchains (like R3 and EWF), and private blockchains (e.g. platforms like Multichain)."
"This TED Talk is the best explanation of why Blockchain is going to change the world (spoiler alert… it’s about trust)."

"Governments and businesses have largely functioned via centralization. Someone or some organization sits in the middle, making the rules, and taking a toll (either taxes or fees) for providing a function. We can now leverage technology, take out the middleman, and enable highly functional decentralized entities (like bitcoin).

Take life insurance. I believe, in the future, through smart contracts and the blockchain, decentralized structures will provide life insurance, saving buyers of life insurance the $10’s of billions of tolls (sales commissions, profits, …) that insurance companies takes for sitting in the middle."
Top high margin industries, https://cdn-images-1.medium.com/max/...b0ShprxVFA.png
https://hackernoon.com/8-thoughts-on...e-448b916138b8

[Danny B]

Automatic Earth

All I can say is; read the article AND every word of the comments.
https://www.theautomaticearth.com/20...-merely-dying/
The comments carry as much import as the article.

[Danny B]

Blockchain and the Mafia

Putin was adamantly against crypto currency. One week later, he did an about face and endorsed them. The blockchain promises "perfect" transparency and accountability. Who would that hurt?
https://sputniknews.com/radio_burnin...2191016060718/

The SDR was created in the 70s and never caught on. An SDR, just like gold is NOT expansive. Paper-gold was created in the early 80s so that the gold supply could be expanded. BTC is VERY expansive and holds great interest of traders. BTC is the beta-test for CB crypto currencies. There are currently about 1,000 coins. They perform different functions. This is in addition to the various functions of the blockchain that could be integrated into contracts and finance.
As each application is attracted to it's best niche in the physical economy, it will stabilize. After a "certain" level of stability is reached, that application / niche will be transferred to State control.

The State always writes the rules in IT'S favor. The State isn't going to give up taxing authority. As transactions move to the blockchain, organized crime will find it ever-more difficult to take a cut. HOW DO YOU SHAKE-DOWN SOMEBODY IN A CASHLESS ECONOMY? Now do you pay bribes if all transactions are recorded on the blockchain?

Chinese exporters sell / ship 1,000 widgets and bill the receiver for $1 million. They true price is only $1/2 million. The receiver credits the sellers overseas account for $ 1/2 million. This is the main way that money is transferred offshore. The blockchain will make even this more difficult.

[Danny B]

Capital inflows and the stock market

Armstrong made it clear that you can't understand the economy if you don't understand international capital flows. Chinese capital is inflating the price of houses from Vancouver to Melbourne.
I can only make things just so simple. I can only break them down just so far. There is too much complexity.

Global wages have been massacred. The velocity of money has stalled out. The ultra rich have all the money but, they do little in the way of consumption. The consumptive loop is starved for consumption. The speculative loop can't do anything but,,, more speculation. The CBs just keep printing more debt money to make up for the profits that are not being realized.

It's not so much that wage inequality is BAD. The problem is that many millions of people don't even have enough to eat. The poverty rates are climbing fast.
"total U.S. household net worth, and every quarter for the past two years this number has steadily gone up, hitting fresh all time highs with every new release, most recently $96.2 trillion"
"bottom 90%, who remain largely locked out from such gains."
"Today, none other than Bridgewater's Ray Dalio focuses on this topic, which he calls "the most important economic, political and social issue of our time", and defines it as "the two US economies"...
"America, some 50% of households, own just 1% of the country's wealth, down from 3% in 1989"
"Since 1980, median household real incomes have been about flat,"

"Only about a third of the bottom 60% saves any of its income (in cash or financial assets). As a result, according to a recent Federal Reserve study, most people in this group would struggle to raise $400 in an emergency."
Americans, in particular, are very poor at saving for retirement. Uncle Sam came along and demanded part of our wages so, he could do the saving for us. Uncle Sam became entranced with the idea of empire and, he spent all of our savings. We don't even have a decent rail system.

"Death rates are rising and mental and physical health is deteriorating for those in the bottom 60%. For those in the bottom 60%, premature deaths are up by about 20% since 2000. The biggest contributors to that change are an increase in deaths by drugs/poisoning (up two times since 2000) and an increase in suicides (up over 50% since 2000). "
Ray Dalio: "This Is The Most Important Economic, Political And Social Issue Of Our Time" | Zero Hedge
Ray says that "we" need to do a big wealth transfer, https://www.cnbc.com/amp/2017/10/23/...ealth-gap.html

Global capital flows;
Here is a long, well thought out article explaining why stock markets are safer than bond markets.
October 2017 IceCap Global Outlook - "Should I Stay or Should I Go?" - IceCap Asset Management Be aware that the article is full of lies.
We know that stock markets are on a tear upwards. Could this continue?
The Swiss national bank recently bought $80 billion of U.S. stocks.
Armstrong, "Our Capital Flow models have been spot on showing the strength of the rally in the Dow is driven by foreign inflows."
"Welcome to the Vertical Market. This is like a party where everyone is drunk, nobody is having a good time, and they just can’t remember exactly how they ended up here.

The crisis building in Europe is having a profound impact as real money starts to move."
https://www.armstrongeconomics.com/m.../dow-the-euro/
The U.S. stock market is attracting capital because it is the best looking horse in the glue factory. What about the worst looking horse?
Macron plans to TAX the snot out of everything in Europe. Don't forget that every additional Euro of tax diminishes the producing economy by about 3 Euros.
https://www.armstrongeconomics.com/i...ralize-europe/
NOBODY in the financial sector will buy European bonds. That explains a lot of the capital flight.

"commercial traders (“smart money”) have a record number of short positions in the Dow Jones Industrial Average DJIA, -0.23% At the same time, noncommercial traders (“dumb money”) have a record number of long positions." YEP, SHEEP TO THE SLAUGHTER.
http://www.marketwatch.com/story/sma...ons-2017-10-18

So, will the foreign inflows allow the market to keep going up for a while?

Venezuela has two big bond payments in the next few days. "The collateral against the bond is Citgo, PDVSA's Houston-based refining and retail subsidiary."
https://www.cnbc.com/amp/2017/10/23/...miss-bill.html
The Chinese prefer land and RE as a store of value. Their savings were channelled into RE and now, there are many millions of commercial and residential buildings that nobody can afford to occupy. The Chinese GOV has a solution.
10/23 China’s govt expected to buy 24% of residential real estate in 2017 – Zero Hedge

[Danny B]

Austerity cripples.., $1/2 quadrillion in debt instruments

Europe is on death watch. The idiots in Germany like Wolfgang Schäuble insist on Austerity because they are so petrified of a repeat of the Weimar hyperinflation. They just don't understand the fact that it is a whole different game today.
"Europe is trapped in similar orthodoxy to that of their prewar forebears. In Germany, they hold the firm belief that inflation is the greatest evil to inflict humankind. Yet the ECB has mastermind the greatest monetary expansion in history without success of stimulating anything. The policy of quantitative easing has been done only at the government level as taxes and tax enforcement has risen and thereby the people and consumption have been totally ignored for fear of inflation. This approach has created an economic nightmare that actually threatens to bankrupt the ECB."

QE for the State and nothing for the lower loop.
"They do not flinch even when a quarter of high street shops close. They are like doctors laying the sick in the snow to see who will survive. Yet they hurl cash at friendly bankers and watch it vanish into the maws of directors and offshore speculators."
"Worse, Europe’s drawn-out austerity is undermining the very authority required to enforce it. When governments fall, no package can be enforced. Greece was forced last month into de facto default. Who would now buy a Spanish bond? What is the value of a Dutch finance minister? What price Nicolas Sarkozy’s signature on a bailout deal? "

"They have driven Greece into chaos and Spain into severe depression, with half its youth now unemployed. The Eurocrats do not care. Their incomes are secure. They dance only round the euro and claim its blood sacrifice. "
https://www.armstrongeconomics.com/i...ing-the-1930s/

It's a very strange world where high-risk bonds are trading at the same rate as U.S. Treasuries, http://www.zerohedge.com/sites/defau...023_gund_0.jpg
It is impossible to say just how long the Cbs can keep interest artes down, Gundlach: "The Order of The Financial System Is About To Be Turned Upside Down" | Zero Hedge

"This means the on and off balance sheet assets for Chinese banks total 232 trillion plus 253 trillion." Just keep in mind that these assets are debt notes.
"The absolute size and growth of assets imply there will be enormous (as in Biblical) costs to deleverage."
" by 2025, China will have financial system assets equal to approximately 1,900% of nominal GDP"
" To provide some perspective, residential real estate in China is 38% more expensive on a price per square foot basis (than U.S.) but nominal per capita GDP in the United States is 608% higher. " Simple, the Chinese can't afford to buy a Chinese house.
Everything We Think We Know About Chinese Finances is Wrong | Balding's World

10/24 Andrew Hoffman – bitcoin to infinity? – FSN He sounds like Buzz Lightyear
10/23 Why EVs will come faster than most of us think – Energy and Carbon Why grid failure will come faster than we think.
10/24 China and US square off in race to master quantum computing – McClatchy DC I wish both of them good luck. We'll finally get some good encryption.