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  #2851  
Old 07-12-2018, 04:28 AM
Danny B Danny B is online now
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View from Jim Willie,,,blindness from Armstrong

I read 40--50 hours a week on this economic stuff. Because of 13 years of reading, I can easily skip most of the articles that I see. It takes that much reading to get an acceptable view of world finance. You can't see anything if you don't look at the whole world. We never actually left behind the last recession. We papered-over it with $200 trillion in new debt. I have to read enough to find an accurate view somewhere between "Goldilocks" and The doomers. Jim Willie leans towards the doom side of things. He also has a pretty good track record. Here is the latest,,, a couple of excerpts from a couple of vids.

INTERVIEW WITH CHUCK OCHELLI

June 23rd: topics covered include the dumping of USTreasury Bonds for buying gold bullion by Russia and for buying many global items by China, the collapse of German giant Deutsche Bank integrally tied to the Italian banking system bust, their tight connection to the LTCM 1998 failure which lost the Italian central bank gold (Rickards crime scene & coverup by Draghi), two trigger events to set off the global financial crisis which will release the controlled Gold market (like DBank/ Italy failure plus Gold Trade Note launch in Shanghai), the fraudulent basis for the entire Euro Monetary Union with excuse for Italy to exit (Goldman Sachs fraudulent collusion to evade Maastricht Rules), the upcoming Systemic Lehman event that hits both sovereign bonds and entire banking systems, USGovt tariffs in trade war with ulterior motives in Europe and Korea, with final items on marijuana laws, coerced CNN acquisition by AT&T, and challenges for USDollar in gold backing

https://ochelli.com/lehman-crisis-event-management/

INTERVIEW WITH V-GUERRILLA AT ROGUE MONEY

June 28th: topics covered include removal of globalist middle level players, self-dealing by owners of the US Federal Reserve, the Trump persona to scuttle NATO, the Eurasian Trade Zone formation & SCO protection, the TPX triumvirate to execute the Global RESET as in Trump Putin Xi, the India & Pakistan detente for the ETZone in its southwestern region, the Petro-Yuan oil settlement with respect to the Gold Standard coming into view, the two key trigger events that release the Gold market from 25 years of suppression (DBank & Italy collapse, plus the Gold Trade Note launch & gold-backed RMB currency), the financial crisis in Turkey, the new role assigned to Turkey in gold office for ETZone toward converting sovereign bonds to gold bullion in Eastern banking systems, the European Union pivot toward Russia with respect to Germany & France, with a view to the St Pete Russian Economic Forum (versus the Davos banker barbeque)

https://www.roguemoney.net/news/jim-willie-rmr-06-27-18

July 5th: topics covered include the assured failure of Deutsche Bank and the guaranteed collapse of the Italian banking system with French falling dominoes in contagion (WHICH IS CERTAIN TO FINALLY RELEASE THE GOLD PRICE), the coming Gold Trade Note alongside the Petro-Yuan launch with a potential gold backing (ALSO TO RELEASE GOLD AS SECOND TRIGGER), Russia’s recent history battling the Deep State, the Elite & JPMorgan large-scale active hoarding of Silver, the true high price inflation for the economy which means a multi-year recession, the new technology rollout with Silver at the core, unintended consequences of failed USGovt sanctions, the ongoing German defiance of US-led Russian sanctions, the new RMB Hub at the Frankfurt Exchange, the role of Blockchain Technology in the Tokenized Economy

https://www.perpetualassets.com/news...th-jim-willie/

Armstrong, "The deep state is the bureaucracy. It is not a global organization" "The deep state rose from 1999 onward. The bureaucracy could now be in charge with a president who is clueless. Obama followed Bush and he missed more than 50% of his daily security briefings. The bureaucracy gained substantial power under Bush and Obama. This is why they are so intent upon getting rid of Trump. They want their power back."
You can see that this is terribly flawed.
https://www.armstrongeconomics.com/w...he-deep-state/

Armstrong, question, "Are central bankers directing the flow of money without any checks or balances? Do you also think that there is an open door between private and central banking that creates endless manipulation of the economy with government support?"

"ANSWER: At the base of all your questions is the ASSUMPTION that they know what they are doing and that they conspire to create a specific outcome. With that assumption, I disagree."
"They assume that there is some dark force that lurks behind every event with the intent to create it. They would rather believe that this is the product of an intentional design for that means they can also intentionally reverse it. "
"Socialism is dying BECAUSE they made promises they cannot keep and they will default in the end. That was never the intent from the outset."
"There is NO LONG-TERM plan and that proves there is also no such dark force lurking behind events"
"European Central Bank (ECB) has created an absolute nightmare that endangers the entire world economy. Yellen was, in fact, yelling at Draghi for his stupidity in moving to negative interest rates. He assumed it would force people to spend and reinflate the economy. It backfired and furthered deflation, causing people to hoard their money. The ECB has not stimulated the economy, but instead, it has kept governments on life support. "

"All of this chaos is because governments are the biggest borrowers in society. This will be our doom and it is why when debt collapses it will destroy the Western economies as they function currently. If confidence in government is so disrupted, there will be no buyers for government debt."
" “Do you also think that there is an open door between private and central banking that creates endless manipulation of the economy with government support?” No, that is absurd."
https://www.armstrongeconomics.com/w...s-or-balances/
You can see where Armstrong misses the boat. Here is a list of those power groups who are trying to control the world. It does include aliens so, a true list might be shorter.
https://www.quora.com/What-groups-of...ind-the-scenes
It's not like the secret groups are a big secret.
https://www.collective-evolution.com...hat-they-said/
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  #2852  
Old 07-12-2018, 02:34 PM
Danny B Danny B is online now
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Brexit, NATO, energy wars

The anti-Brexit people claimed that Brexit would bring ruin to England. The truth is a different story.
"Since the Brexit vote, the UK has created 450 thousand jobs.

Unemployment stands at a 4% rate, the lowest since 1975. Labor Participation Rate is at 75%. This compares to an EU unemployment of 8.7% and 58% labor participation rate in the 28 member states.

Productivity is growing at the fastest rate in 6 years, while UK factory orders at 4-year high.
At the same time, wage growth has accelerated to two-year highs.
Inflation is above expectations, but that has nothing to do with Brexit and all to do with the Bank of England’s extremely loose monetary policy.

Additionally, GDP growth is expected to range between at 1.5% and 1.9% for 2018 and 2019, very far away from the expectations of plunging straight into recession just from a Brexit vote."
https://www.zerohedge.com/news/2018-...lieve-them-now
The real economy seems to be surviving Brexit just fine. It is the City of London bankers who stand to lose from Brexit. Teresa May seems destined to go down in flames just to support the banks. At the same time, these same bankers will do anything to demonize Russia. They lost the pipeline wars and, are now trying to drive Russia out of the oil markets by other means.

"Russia attacking NATO makes as much sense as NATO attacking Russia: none whatsoever. Unwinnable. Russia attacking Germany and other European countries, which buy its oil and gas, makes no sense because it would then lose those revenues. From that point of view, European dependence on Russian energy is even a peacemaker, because it benefits both sides."
"if Putin wants his country strong and independent, the last thing he would do is to risk his oil and gas contracts with Europe. They’re simply too important, economically and politically. Trump may want some of that action for the US, understandably, but for now US LNG can’t compete with Russian pipelines. Simple as that. "

The power mongers in NYC, D. of C. and Tel Aviv have always lusted over the riches of Central Asia. Specifically the carbon riches. The R.O.W. does not want to be taken over. They are getting more organized.
https://www.rt.com/business/431454-r...l-alliance-us/

NATO is just a slush fund for the arms manufacturers to squeeze Europeans for more and more tax money. Russia and the U.S.S.R. agreed to go quietly into the night when socialism brought them down. We gave them our solemn promise NOT to expand NATO any further East. Bill Clinton broke that promise. The war-mongers like Nuland will do anything to provoke Russia and keep the arms business rolling along.

"This time it was Germany that took the main hit, over the fact that it pays Russia billions of dollars for oil and gas while relying on the US for its defense … against Russia. "
"The military-industrial complex (MIC) has every reason to make the threat posed by ‘enemies’ as big as they possibly can"
"According to GlobalFirePower, the US in 2018 will spend $647 billion on its military, while Russia is to spend a full $600 billion less, at $47 billion. And the US Senate has already voted in a $82 billion boost recently."

"The solution to the problems Trump indicated this morning is not for Germany et al to spend more on NATO and their military in general, but for the US to spend less. Much less. Because the Russian threat is a hoax that serves the interests of the MIC, the politicians and the media. "
"To reiterate: developments in weapons technology, for instance hypersonic rocket systems make most other weapons systems obsolete. Which is obviously a big threat to the MIC."
https://www.theautomaticearth.com/20...is-a-con-game/

NATO is just a holdover from the days when armies marched off to war. Those days are gone but, the bloated military still wants a huge chunk of the GDP.

7/12 China has its currency to use as a weapon in trade war with Trump – CNBC
7/12 Is currency China’s secret weapon? – Real Money

Nope, currency manipulation is always a double-edged sword.
7/12 Trump trade wars turn global asset bubble into weapon of mass destruction – SCMP
7/12 US-China trade negotiations have ground to a halt – Zero Hedge
7/12 How Trump’s trade war went from 18 products to 10,000 – New York Times

The markets can't really tolerate any big bumps in the road.
7/12 Global debt hits $247 trillion, IIF issues warning – Zero Hedge
Funny,,, I didn't get any kind of warning from them.

The whole question of tariffs is NOT an open-and-shut case.
https://www.logisticsmgmt.com/articl...utm_medium=NLT

The ultimate drug pushers (the banker) have destroyed much of Mexico. It used to be my second home.
https://www.theguardian.com/world/20...land-paralyzed
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  #2853  
Old 07-12-2018, 09:41 PM
wayne.ct wayne.ct is offline
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A few thoughts

A few thoughts in response to your recent posts and whatever else I've been reading and hearing.

1. A wave of realism seems to be forming. True, some corners are full of stupidity and irrationality, not to mention logical disjointedness. But, at least for a few years now we will have a form of measured reason and common sense.

2. One point specifically. US Revenue needs to increase if expenses cannot be reduced sharply. The import tariffs increase revenue without taxing personal income directly.

3. The poorest will not see a huge jump in their expenditures. Discretionary income will not be directly affected.

4. It is mostly a hidden tax on the middle class and upper classes where more discretionary income is in play.

5. The war mongers will be mollified because everyone "knows" that trade wars are the harbingers of real military actions.

6. So, who are the winners and losers? Winners: Poor, military, fiscal conservatives. Losers: Foolish rich, liberals and people that believe foolish nonsense about race, LGBT, etc. (I am trying to stay out of the "weeds")

7. The decisions around personal spending and corporate spending are being pushed down closer to the individual and away from the higher ups and more restricted and larger corporate entities. So it seems to me.
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  #2854  
Old 07-13-2018, 03:21 PM
Danny B Danny B is online now
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Teresa May's flameout,,, London-Italian-German contagion

Dunno, Wayne. Point number 2 is not looking good.
7/12 US budget deficit up 16% y-o-y on soaring interest, plunging corp taxes – Bloomberg
I don't see a turnaround in tax collection.

Teresa May is really in the hot seat now. Her white paper proposes;
"More notably, the White Paper revealed that May has accepted that the UK's banks will need to leave the European banking union. The policy chairman of the City of London, where the UK's financial sector is based, said the proposals outlined in the White Paper would be a "real blow" to the UK banking sector."
https://www.zerohedge.com/news/2018-...ed-white-paper
The scare-mongering is at a fever pitch.
"leading Tory rebel said “ordinary life will grind to a halt” if the talks are still deadlocked as D-Day nears.

The warning came as Mr Rees-Mogg launched his most outspoken attack yet on big businesses opposing a hard Brexit, claiming they have “got everything wrong in the whole of their history”.
https://www.independent.co.uk/news/u...-a8443241.html

Solar power and wind power have brought us some good news concerning fission power.
https://www.zerohedge.com/news/2018-...faces-collapse

The bureaucratic overlay of the EU on formerly healthy European States has reduced their GDP by 20%. This is a perfect example of the "blob state" sucking dry it's host country. It doesn't cost very much to pay the MEPs. BUT, it costs enormous amounts of wealth to pay for all the hordes of bureaucrats. So, what happens when you reduce a country's GDP by 20%? Simple, they go broke. Italy is the perfect example. They have reached a "death cross'.
http://www.zerohedge.com/sites/defau...13_italy_0.jpg

There is no gdp growth because the blob state sucks out the operating capital,,, for consumption. They can't grow without free capital to invest. Also true, they can't very well grow with a falling population. Bringing in trash from north Africa isn't the answer. They are finally catching on to the problems.
https://www.zerohedge.com/news/2016-...th-cross-chart

So, the Brexit crisis is setting off problems with Italian banks. The Italian banks have a huge number of non-performing loans because everybody is broke. The Italian banking crisis weakens the Deutsche bank crisis because they have so much exposure to Italian loans.
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  #2855  
Old 07-14-2018, 03:46 AM
Danny B Danny B is online now
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private money,, The Middle Kingdom astride a dragon

Armstrong roundly condemns President Jackson for destroying the early Central Bank. "Your are a den of thieves and, I will rout you out".
Armstrong, "When Andrew Jackson shut down the central bank, the Bank of the United States at that time, all banks began to issue money of their own. The economy was flooded with frauds and nobody knew what banks were real or safe. As banks failed, the States tried to bail out the banks to save their economy and they too were pushed into default. The Depression that followed raised unemployment and violence."
https://www.armstrongeconomics.com/w...-not-finished/
So, we learn that we need a CENTRAL bank to issue money. BUT, it is still private money.
"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered"

The problem according to Armstrong was, too many private banks were issuing money. The ACTUAL problem was privately issued money. The parasite class needs to have control of the issuance of money to create the constant monetary inflation necessary for them to prosper. The FED reportedly creates a 2% inflation of the currency. The price inflation is quite a bit higher. At 4% per year of price inflation, prices double every 18 years. Since wages always lag price inflation, we are always losing.
The parasite class shrinks to the size of a pimple if it can't inflate the money supply.

C.H. Smith writes about gangster capitalism in Big Pharma.
oftwominds-Charles Hugh Smith: Big Pharma and the Rise of Gangster Capitalism
7/13 Social Security and Medicare add another $50 trillion to national debt – Mauldin
No problem, The millennials will kick in the money

China was in a big rush to pump liquidity into every nook and cranny to get all the growth it could. Obviously, you can't force in that amount of debt without making some bad loans. Their ration of non-performing loans is at 17%.
https://i0.wp.com/www.dollarcollapse...00%2C382&ssl=1
Think about it. If 17% of loans are not being repaid, how much new credit has to be created to cover up the big, black hole?
This graph is total debt compared to the GDP. You can see just a bit of levelling off.
https://i1.wp.com/www.dollarcollapse...00%2C463&ssl=1
Evidently, this tiny bit of levelling off is creating huge problems. The Chinese wanted to cut back credit creation and, they did. Now, they are having to walk-back the reduction.
Corporate bond defaults are close to 20%.
https://i2.wp.com/www.dollarcollapse...00%2C367&ssl=1
This is an excellent article.
https://www.dollarcollapse.com/china...-deleveraging/
The Chinese moved 300 + million self-sufficient peasants to the cities and provided them jobs. The jobs were temporary because they impoverished their best customers. The ceiling on wages brought on by the emerging market countries holds down everybody. By loaning and spending money recklessly, the Chines have created a dragon that they can't get off.
Trump is adding more fuel to the dragon's belly.
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  #2856  
Old 07-15-2018, 06:04 PM
Danny B Danny B is online now
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Ramming at warp 5

Nothing much new. Nigel Farage says that he expects Teresa May to be out within a fortnight. That gives England very little time to organize a new government before the leave deadline. I seriously doubt that an agreement can be cobbled together. The City of London financiers have threatened that $30 trillion in debt instruments are in danger.
Buy more popcorn.
Evidently, Chinese buyers are leaving the property markets in OZ,,, except for New South Wales.
https://www.macrobusiness.com.au/201...buyers-gone-2/

Armstrong, "Virtually EVERY revolution throughout history appears to emerge from a tax rebellion. It will often expand into ethnic or religious slogans, but at the core, it is always taxation. The American revolution was the class – No Taxation Without Representation. Yet the greed of politicians inevitably leads to their own destruction for they cannot resist spending other people’s money."
https://www.armstrongeconomics.com/w...dence-66-70ad/

"Programs that have blown up like the Black & Scholes that ended up winning the Noble Prize just before blowing up the world economy in Long-Term Capital Management Crisis of 1998, took place because you had two math geniuses who lacked trading skills. The formula that blew up the Real Estate models in 2007 made the same mistake. "
https://www.armstrongeconomics.com/a...king-a-degree/

Here is an interesting graph that indicates a timeline for the next recession.
https://www.zerohedge.com/sites/defa...0model%201.jpg
It is an interesting indicator but, the accuracy is dependent on doubtful data.
https://www.zerohedge.com/news/2018-...never-achieved

"According to the Bank of International Settlements ("BIS"), loans and debts outstanding which burden corporations, households, and the government in the United States have reached $48.3 trillion in the United States or 250% of GDP. Including off-balance sheet items, the effective level of debt outstanding is almost $100 trillion, at $99.6 trillion, or more than 500% of GDP."
"students have amassed more than $1.5 trillion of student loans, which have increased at a rate of more than 10% per annum since 2006. "

An early currency reset.
"[Dionysus] ordered all the coin in the city to be brought to him, under penalty of death. After taking up the collection, he re-stamped the coins, giving to each drachma the value of two drachmae, so that he was enabled to pay back both the original loan and the money he had ordered brought to the mint."

Credit to households ($15.25 trillion or 79.7% of GDP)
Credit to Non-Financial corporations ($14.26 trillion or 73.5% of GDP Government debt ($18.81 trillion or 97.0% of U.S. GDP)
Pension underfunding ($2.25 trillion or 11.6% of GDP)
Social insurance obligations ($49.0 trillion or 253% of GDP
interest payments for U.S. corporations, households, and government entities are now almost two trillion dollars annually, representing almost 10% of U.S. GDP. If interest rates were to rise to historical levels, these interest rate payments would crush the U.S. economy and likely result in another debt crisis. Even without the Federal Reserve raising interest rates further, interest payments should exceed 10% of GDP sometime in 2018"
https://www.forbes.com/sites/adamstr.../#3b0becf7ccb9
Why the Fed Raised Rates for the Seventh Time in Three Years

Here is a graph of the unemployment rate, https://static01.nyt.com/newsgraphic.../labor-945.png
Labor market conditions, https://static01.nyt.com/newsgraphic.../labor-945.png
"Job growth, a key consideration for the Fed, is robust

The economy has added 192,000 jobs a month on average since the Fed began raising rates at the end of 2015. The unemployment rate has fallen to 3.8 percent"
96 million not in the labor force.
https://fred.stlouisfed.org/series/LNS15000000
So, employment is way up and, Powell is going to continue to raise rates.
Corporate profits are doing very well.
https://www.nytimes.com/2018/07/13/b...ype=Multimedia

What do you see if you look under the hood?
" Global debt ended the first quarter at a record $247 Trillion, or 318% of GDP. Even after a decade of historic Credit inflation, global debt continues to expand at ("Terminal Phase") double-digit rates (11.1% y-o-y).
"Global debt growth accelerated during the first quarter to $8.0 Trillion - and surged $30 Trillion over just the past five quarters. In a single data point not to be disregarded, Global Debt Has Expanded (a difficult to fathom) $150 Trillion, or 150%, Over the Past Ten Years. "
Don't worry, we're in recovery,,, aren't we?

"total debts owed by households, governments and financial and non-financial corporations amounted to $247.2tn at the end of March, up from $222.6tn a year earlier and an increase of nearly $8tn in the first quarter alone."
"The IIF said the debts of non-financial corporations in EMs rose $1.5tn in the first quarter to $31.5tn, the equivalent of 94.4% of GDP"
This category includes Chinese manufacturers. That might be why NPLs are 17.5% in China. Powell is bringing the U.S. ship of State up to ramming speed. He knows that the whole world will blow. BUT, America has a safety net and, China does not. The system will blow any way. Powell wants to raise rates until something pops.
Powell wants to use the declining momentum from our Bretton Woods credit card to keep imports coming to America. China wants to use the eternal confidence in gold to keep commerce going in China.

I suspect that they will clobber the gold markets when they feel that they have accumulated all that they can. They will blow up the paper market to make the physical market reflect actual supply.
The world is entering a trade war. Trade wars often turn in to shooting wars. This time is different. The new weapons can easily reach the politicians wherever they are hiding.
https://www.newsweek.com/russia-and-...ls-warn-861692
Pox Americana already attacked China with a dumb weapon.
http://www.dailymail.co.uk/news/arti...-revealed.html
The Chinese and Russians now have smart weapons.

Powell has thrown a hand-grenade into credit markets. It is up to Trump to try to hold things together.
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  #2857  
Old 07-16-2018, 02:55 PM
Danny B Danny B is online now
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Highlights of the trade war

The trade war has only just started and, Maersk Shipping appears to be it's first big causality.
https://www.zerohedge.com/news/2018-...eality-strikes
"The bigger worry is its economy is slowing more quickly than expected at the same time Chinese authorities are trying to remove mountains of debt built in the financial system.

If it is a problem for China's economy, it is a problem for the global economy in general and Australia's economy in particular."
"Among the largest economic risks that Australia faces is something going wrong in China,"
Trade war masks a bigger problem in China's slowing economy - ABC News (Australian Broadcasting Corporation)
The boom in OZ is very much correlated to the boom in China. China is trying to do a balancing act by slowing credit growth but, not by too much.

Armstrong, "As soon as you borrow in another currency, you will then encounter FOREX risk. Third world countries have been borrowing in dollars extensively. As the dollar rises, we will see defaults BECAUSE of the currency risk. At the very least, countries must be prohibited from borrowing in foreign currencies, or preferably, governments should be prohibited from borrowing PERIOD! "
https://www.armstrongeconomics.com/m...n-governments/
Here is the good news from this same article;
There are other ways to restructure the global financial system. I am preparing the full solution that we need to examine based upon history and what has worked and what has failed.
I hope that he has a good plan. Times are different now.
Capital can be transported instantly.
Labor can NOT be transported instantly so, they move the factory instead of moving the laborers.
Raw materials and finished goods can be transported very fast.
The low-wage States put a ceiling on wages. At the same time, China has a shrinking labor force. At the same time, automation reduces demand for a labor force. All of the above shrinks world consumptive power.

The working class are content to work and, get by. The self-appointed elites dream of empire and, they bring down their own country. Erdogan is well on his way to destroying Turkey.
https://www.armstrongeconomics.com/i...market-crisis/

Here is a list and map of the States with the most debt. America barely makes the list.
One detail, " governments also have massive “unfunded liabilities” that don’t show in the numbers above. "
https://ggc-mauldin-images.s3.amazon...80713_TFTF.jpg
Notice how they have shrunk India on the map to a pipsqueak.

"Importantly, households aren’t driving this. Governments accounted for 43% of the increase McKinsey cites and nonfinancial corporate debt was 41%. That is where I think the coming train crash will originate. Governments have more debt than corporations,"
Armstrong has predicted a crash in GOV debt. It looks like the States are hard at work to prove him right.

7/16 Every inflation measurement is increasing – Upfina
7/16 US has 99 trade war problems, but inflation isn’t one – Hill



" President Trump escalated the trade war yesterday, making a kamikaze attack on a vast armada of Chinese imports – $200 billion in total – headed for California."
We saw our colleague, former U.S. budget chief under President Reagan, David Stockman, on TV yesterday. The interview was painful to watch.

He was bravely trying to explain the trade deficit and why it was caused by monetary policy, not by trade ramparts that were too low.

But the young, know-it-all newscasters were such numbskulls – so lacking in any experience, theory, or historical perspective – he might as well have been instructing a walrus on how to chew gum. "
"The three TV experts saw no problem with the trade deficit… and no danger approaching from Trump’s war on it."
https://bonnerandpartners.com/the-ma...-are-laughing/
The article is pretty good. What it addresses is; Powell has brought us up to ramming speed while Trump is lobbing hand grenades at China. China faces the impossible trinity.
America faces a dearth of domestic oil production. D.C. is trying to exploit weaknesses in Chinese financial markets. I suspect that China will prevail in the end. Pox Americana has attacked every State that exports oil. When push comes to shove and, fracking blows up (financially), America will find itself short of oil.
Russia, et al are forming a super OPEC. They will put the squeeze on American (and European) militarism. This will be good for everyone in the end... except for those who dream of military empires.
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  #2858  
Old 07-17-2018, 02:45 PM
Danny B Danny B is online now
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The currency reset,,, squeezing Dems

ALL currencies eventually get destroyed or revalued. America's unique position after WW II allowed it to pull in a lot of wealth. We had 25,500 tons of gold. The welfare-warfare state pissed this away. We had lots of oil. We burned it. We had the Bretton Woods credit card. We maxxed it out. The debts in the West are just too high and, growing too fast. We can't very well have a credit collapse without also having a currency collapse.
I wrote to some knowledgeable people asking when the banks would close.
Nobody knows. Though everybody seems to be too early on their projections. Here are two headline to keep in mind.
7/17 Greyerz: The reset will come like a theif in the night – King World News
7/17 IMF warns of “sudden repricing” of assets as global economy slows – Zero Hedge

This was my experience during a currency reset when I was in Mexico.

Youtube titles;
Trump is Preparing! TRUMP & Global Currency Reset
GLOBAL CURRENCY RESET IMMINENT ? ABEL DANGER thinks so!!
GLOBAL CURRENCY RESET! TRUMP IS GOING FOR A CLEAN RESET
TRUMP & Global Currency Reset: Monetary Reform Would Rebalance Trade
ARTK#165/Pt.2: Sherry Beall on Global Currency Reset shift with Lynette Zang

Central banker lets slip Global Financial Reset is underway | IQD Dinar Currency Exchange RV
Dinar Revaluation 2018 (Weekend News) Global Currency Reset Soon?
Jim Willie GLOBAL CURRENCY RESET: The Largest Something In History Is Happening Worldwide
IMF Warning 🆘 Global Currency Reset Confirm 100%! Dollars/Euros/Yen/Yuan,Etc - Are You
Here's Jim Willie, https://www.youtube.com/watch?v=_zYhhWVNf6M

"GET READY FOR THE SIMULTANEOUS BANKING CRISIS IN THE THREE BIGGEST EUROPEAN ECONOMIES: GERMANY, FRANCE, ITALY. The United States and the London Centre will not be able to avoid the crisis."
"The largest bank in Europe is Deutsche Bank. Its credit default swap is rising in cost, while its stock price has entered single digits in a powerful decline. The great D-Bank, site of the European office in management of the multi-$trillion derivatives, is on the verge of financial failure. It is the largest bank in all of Europe. All of its business segments are impaired and losing money in a hemorrhage. Furthermore, it is a big bond holder for Italian Govt Bonds. The Italian banking system is in the death throes, which has finally been recognized. Their recent elections openly debated pathways in the face of banking system failure,"
https://www.silverdoctors.com/headli...wo-key-events/
You should read the whole article.

History dictates that something like this must happen.

The housing bubble moves into stage 2.
"The world real estate market is HUGE, over $200 trillion. That dwarfs the global debt and equity markets."
This is a good article with an excellent graph that I can't bookmark.
https://www.peakprosperity.com/blog/...housing-market

Jim Willie, "They also have been hurt by the rising bond yields for the USTreasurys. The lie on economic growth has been about 5% to 7% every year, from severely gimmicked price inflation. See Shadow Govt Statistics with John Williams for proof. Therefore, the true inflation adjusted GDP has been minus 2% to minus 4% every year since before the Lehman failure."
Keep in mind that U.S. GOV spends about 24% of the gdp. Armstrong says that it is actually much higher. Keep in mind that advertising and finance are included in the gdp even though they produce nothing. The true productive gdp has fallen for years.

"Thus, the $2.5 quadrillion monster bubble contains just empty promises that all disappear when the bubble is popped. These promises are not only words, but also $2.5 quadrillion of monetary promises or IOUs. To keep the bubble from deflating, central banks have had to constantly pump it up bigger and bigger. "
"When the global debt and asset bubble pops, the world will find out that there was nothing inside. Of course, there are real assets and real wealth, but the problem is that when the bubble pops, all the debt will implode because no one can repay it, and with that, a lot of the assets will become worthless. "
"The only question is if stocks, bonds, property, and other assets, will go down by 75% or 95%. In my view, the biggest bubble in history will lead to the biggest collapse. There is no one that can save the world from the biggest financial calamity in history."
Wait, what about the SDR?
A good read; https://kingworldnews.com/alert-grey...-in-the-night/

The IMF, https://www.zerohedge.com/news/2018-...nomic-forecast

7/16 IRS revokes 362,000 passports over taxes – Sovereign Man
36 Obama aides owe $833,000 in back taxes | Investor's Business Daily
Politicians Who Skipped Out On Taxes - Investopedia

AND
Soros-Linked Nonprofit Led By Hillary And Obama
Alum Spending Millions To 'Stop' Kavanaugh

Federal prosecutors are digging into everything that Kavanaugh did. They can speed up the process of following all the trails that eventually lead back to Killary and Obummer. They can subpoena anyone that they want and, those people can't leave the country.... not if they owe the IRS.
Soros is trying to block the paths that lead back to Obummer. The Dems would quash an investigation into Killary. They can't very well quash a required investigation in to Kavanaugh.
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Last edited by Danny B; 07-17-2018 at 02:58 PM. Reason: sbelling
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Old 07-18-2018, 03:59 AM
Danny B Danny B is online now
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Believe me, the stock market will continue to go UP,,, bureaucrats

The IMF., BIS and many writers are warning about the complacency of investors. NOTHING seems to dampen their chase of profits. This isn't entirely true because some investors are leaving.
"The insiders can see the handwriting on the wall and they are getting out of the market at a pace that we haven’t seen since 2008"
"But for now, the talking heads on television continue to insist that everything is just fine and that the stock market still has more room to go up…

There’s still room for stock markets to rise and worries of an impending recession are premature, according to Berenberg Capital Markets’ chief economist.

“Even if profits peaked in (the first quarter of) 2018, which remains uncertain, history suggests the stock market has room to appreciate,” Mickey Levy, Berenberg’s chief Americas and Asia economist, said in a client note this week. "
https://www.zerohedge.com/news/2018-...ck-market-half
Ron Paul said that the stock market had quadrupled since 2009 and, that it would be cut in half by the crash. John Hussman claims that it will be more likely to lose 75---90%

7/17 Warnings of market complacency grow louder as IMF joins fray – Bloomberg
7/17 Morgan Stanley’s stock market analyst warns clients to get defensive – CNBC

Bonds are going down. Reportedly, stocks will be crashed / sacrificed to save bonds.
https://www.zerohedge.com/news/2018-...cks-save-bonds
Remember that Armstrong said that GOV debt would crash but, that it wouldn't affect the overall economy very much. A LIE if I ever heard one.
Our mega-bubble has reached a new milestone;
https://www.bitguru.co.uk/crypto-new...ow-officially/

The deep state is those people who make a lot of money by continuing U.S. and world militarism. The "blob State" is those people who are the bureaucrats and functionaries. Armstrong incorrectly lumps them all together. The blob state doesn't set any policy.

Rules of Bureaucracies
1) The first thing you do is assign blame. Do not fix the problem, but make sure that blame is assigned. Remember if you fix the problem, your job is at risk.
2) Assign your work to someone else
3) Vote/assign yourself salary raises and as many perks as you can get.

"Corporations also fail when the board replaces the creators, abandon imagination, and proceed to comply with all the rules so they are run by the lawyers and accountants."
"The Deep State is indeed the bureaucracy. Just look at Brussels. They are waging a fight against anything that would undermine the euro, not to further the living standards or expand the economy of Europe. It has now turned all around and the primary goal is to preserve the EU bureaucracy. They now are defending their jobs. "
https://www.armstrongeconomics.com/a...-corporations/
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Old 07-18-2018, 02:25 PM
Danny B Danny B is online now
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Market fragility

"The insiders can see the handwriting on the wall and they are getting out of the market at a pace that we haven’t seen since 2008"
OK, but, where are they going?
With the help of computers, people can do far better analytics than ever before. Here is the perfect example.

The Warren Buffet Indicator
He compares the size of the stock market to GDP, the premise being that the US stock market should not be bigger than the country’s annual economic output. If it is, the market is overvalued. If it’s smaller than GDP, it is, by varying degrees, undervalued.
Right now, the stock market is 40% larger than the US economy. It’s the second-highest reading since 1947.

Margin Debt
As you can probably surmise, the greater the level of margin debt, the more fragile the system is.
Well, margin debt is currently at the highest level in history:
With margin debt at all-time highs, the stock market is highly vulnerable to a crash. Once stocks begin to decline, whether it happens slowly or quickly, more and more investors will be forced to sell, or worse get a “margin call” where they must either deposit more money in the account or sell some of their investments, which would further exacerbate the selloff.

The Market Fragility Index
Mike combines the Buffet Indicator with margin debt to create the Market Fragility Index. It is a new metric you won’t find anywhere else.
As you can see, Mike’s indicator shows the stock market is now so high that it is a “threat to the global financial system.” Every time this indicator got this high in the past we experienced a severe financial, economic, or monetary crisis. And we’re now at the highest reading it has ever registered.
In other words, the stock market is more fragile now than at any time in history. It’s not just top-heavy; the combined amount of leverage and lofty valuations we have today exceed even those of 1929.
https://goldsilver.com/blog/introduc...ts-saying-now/

Netflix
For some painfully idiotic reason, analysts seem to judge Netflix by a single benchmark: the number of subscribers.

If subscriber growth is strong, Netflix stock soars.

I say this is ‘painfully idiotic’ because Netflix loses money year after year. The more subscribers they bring in, the more money they lose.

At the end of 2015, for example, Netflix had 75 million subscribers. But its Free Cash Flow was NEGATIVE $920 million.

The following year, Netflix had grown its subscriber base to 93 million. Yet its Free Cash Flow had sunk even further to negative $1.65 billion.

By the end of 2017, Netflix subscribers totaled 117 million. But the company burned through $2.02 billion."
https://www.zerohedge.com/news/2018-...my-nominations

We are not looking a just a stock market crash. Things are too far gone for that. It will also be a monetary crash and a CURRENCY crash.
https://www.financialsense.com/fs-st...-may-be-result

So, money is fleeing the sock market. Where will it go?
"The fact is that the Fed HAS TO act to stop the bond bubble from bursting. And it’s going to do this by crashing stocks, and driving capital into the bond market to force yields lower."
"This is why the Fed continues to hike interest rates and drain liquidity from the financial system via its now $40 billion per month QT program: the Fed HAS TO get bond yields back below their trendline."
https://www.zerohedge.com/news/2018-...cks-save-bonds
ANYONE who would be in a position to buy GOV bonds would most likely be aware of Armstrong's premier forecast that GOV bonds are going to crash.

"In other words, the takeaway was that the Fed is going to keep gradually raising interest rates until something breaks. And that something could very well be the yield curve."
"The overarching view seems to be that policy makers will deal with an inverted yield curve if and when it happens. “
"Soon after that remark, the yield spread between 2- and 10-year Treasuries reached a session low of 24 basis points."
https://www.bloombergquint.com/onweb...he-yield-curve
Powell is going to get bit in the a$$ by the yield curve inversion. "until something breaks". Market fragility is the worst ever recorded and, Powell is going to raise rates until something breaks.

The CBs stuffed the markets to the gills to stave off defaults. In 2008, the lower loop defaulted heavily and, the FED saved the upper loop. Much of the bad paper from the upper loop was stuffed into GOV balance sheets. The stock market is not far from blowing all to hell. This will work it's way up into the bond markets. The default cascade will overtake the upper loop AND, GOV bonds.
https://tomluongo.me/2018/07/16/five...-debt-default/

Armstrong writes that the value of a commodity backed currency does not vary because of political events. The value of an un-backed currency varies with every shift in confidence. Brilliant guy but, he can't avoid slipping in a lie if it suits his viewpoint.
"If we had a money supply that could NEVER change, then you would create deflation as the population grew. "
This is the big lie. The gold supply grows by about 2% a year. The economy grows by about 2% a year. This 2% number is UNACCEPTABLE to the bankers. It leaves nothing for the parasites. Don't forget that the population is falling

"When money began to appear as paper currency, this altered the monetary system for then the value of that currency was dependent upon the “confidence” of the people in that currency."

https://www.armstrongeconomics.com/w...netary-system/
"If we had a money supply that could NEVER change, then you would create deflation as the population grew. If there were only 10 gold coins and a population of 5 people, then everyone could have two coins, but one will inevitably have 4 because they invented something others wanted."
YES, capitalism involves work and, the "best" people survive and thrive.

7/18 Why investors are opting for bitcoin futures – US News
7/18 How quantum computers could steal your bitcoin – News.com
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Old 07-20-2018, 03:02 AM
Danny B Danny B is online now
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eX US stocks falling,. dollar rising

There is a lot going on but, much of it is subtle.
7/19 Japan, EU sign trade deal to eliminate nearly all tariffs – CNBC
Those tariffs are income to the State.
Armstrong,"Rio Tinto spent $940 million to develop this project. The train consists of three locomotives and carries around 28,000 tonnes of iron ore making a journey of 280km with no human driver."
So, for $940 million, they eliminated an engineers job.
"The high cost of socialism is driving the field of robotics. The higher the costs of pensions and their lack of feasibility when central banks play with interest rates pretending to be managing the economy has driven the technology into the hands of automation. Governments are in a state of denial and they will continue to raise taxes to try to cover their costs. "
https://www.armstrongeconomics.com/w...largest-robot/
What a bonehead. When is he going to advocate killing all the people who don't support themselves? Sure, go ahead,,, condemn socialism. Turn 250 million (in the West) out onto the streets. It was MONETARY policy that brought the price inflation that makes it impossible for retirees to survive. It was endless wars that ate up the pension (SS) money. They suffer from a wealth transfer. Armstrong says,,, let them eat air.

"The Shanghai Composite Index of stocks has declined 7 percent in a month, dropping below the government’s red line of 3,000 for the first time since September 2016. Corporate bonds are about to set a record for the most defaults in a year. daily press reports on governments that can’t pay their employees or meet pension obligations."
"When dollars enter, the central bank buys them and issues renminbi. If it has to issue more than is justified by the amount of inflows, it creates inflation, and inflation, which has toppled or almost toppled governments from the Ming dynasty to Tiananmen, is the third rail of Chinese politics."

Side note, 7/19 China boosts liquidity, set to ease more trade war threatens – Reuters The dragon will get them in the end.

"Until now, China has managed to keep its huge raft of nonperforming debt afloat thanks to capital inflows, as successive waves of quantitative easing pushed dollars into the world. A tighter dollar would seem to make the bursting of China’s credit bubble an inevitability. "
Note to Powell.
https://www.bloombergquint.com/opini...se-debt-crisis

The dollar is sharply rising. This wipes out dollar-denominated debt in all other currencies. Imagine playing a game of "chicken" with Molotov coattails,,,, in your living room.
Here is a very good article on the dollar,,,, a weapon.
"And dollar-based sanctions are a powerful financial weapon for the U.S. But our adversaries and so-called allies are not standing still. They are already envisioning a world where the dollar is not the major reserve and trade currency.

In the longer run, Russia, China, Iran, Turkey and others are working flat-out to invent and implement nondollar transactional currencies and independent payments systems."
Trump is really pushing sanctions. This gives great motivation to many States to avoid the dollar altogether. That isn't the key item.
"imagine a three-way trade in which North Korea sells weapons to Iran, Iran sells oil to China and China sells food to North Korea. All of these transactions can be recorded on a blockchain and netted out on a quarterly basis with the net settlement payment made in gold shipped to the party with the net balance due."

Do you see it? There is NO mention of any bank. A migration to the blockchain sidelines the banks. Instead of currencies being exchanged, all transactions go to the blockchain and, are netted out in gold. Currency will be used in day-to-day transactions but, gold will be the store of value.
https://dailyreckoning.com/the-u-s-d...s-own-success/

Interesting article from Armstrong on his history and development.
https://www.armstrongeconomics.com/a...-through-life/

Everyone is warning about complacency in the stock market. It looks like tech stocks are starting to tumble.
"$FB, $GOOGL, $AMZN, $MSFT and $AAPL. These 5 stocks now worth nearly $4.1 trillion." "Now check this out: Their combined market cap increase? $260,000,000,000. That’s $260B. In just the past ELEVEN trading DAYS!" "2018 year to date? EIGHT HUNDRED TWELVE BILLION DOLLARS market cap expansion in just 6.5 months. $812,000,000,000."
Great graphs, https://northmantrader.com/2018/07/18/tech-alert/

Also, this is spilling over into other markets.
"The strength of the USD is starting to become a lot more visible over the past 48 hours. In some countries, its looks as though currencies require a helping hand just to slow their downward spiral. "
"All of core Europe suffered today either through stock or currency. " "Core US indices were in negative territory all day." "Financials falling around 1.5% reversing much of their recent gains. Commodities (Industrial Metals) and retailers (eBay down 12%) "

Powell is bring the U.S ship of state up to ramming speed. Presumably to destroy China. Maybe Powell expects to attract fleeing capital. Everybody who is anybody is aware of Armstrong's main prediction fo a collapse of public debt. I don't expect much fleeing capital to go to GOV bonds.
Russia dumped more treasuries and (possibly) the Cayman Islands scooped them up. I'm doubtful.
7/19 Moscow mystery: Where did all its Treasuries go? – GATA
http://www.gata.org/node/18377
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Old 07-20-2018, 02:43 PM
Danny B Danny B is online now
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Shots fired,,, at China

7/20 How can we reverse Brexit when Europe doesn’t want us back? – Prospect
"They" are starting to get very nervous about a no-deal Brexit.
Dominic Raab faces EU's Barnier for first time amid no-deal warnings | Daily Mail Online
May, has gone to war with just about everybody. She shouldn't rattle markets when German, Italian and French banks are teetering on the edge of insolvency.

And then, there is China. Dollar liquidity is drying up, especially for emerging markets. No dollars = no loan service.
7/20 A China borrower’s $11 billion debt mountain comes crashing down – Bloomerg
Imagine the contagion from that.
7/19 “Biggest bubble in history of mankind” is “going to burst” — Ron Paul – GC
7/20 China’s yuan plunges again. Is a currency war coming? – CNN
The dragon has heartburn from too much printing.

7/20 China weaponizes yuan, weakens fix by most since 2016 – ZH
It's not like they have any choice. The markets are just reacting to China's attempt to save everything.
7/20 Trade war with China morphs into currency war, biggest loser EU – Mish
Give it time and, we will all lose.
7/20 Housing chaos in 30 Chinese cities – Chinese stocks
This has only just started.

The tech bubble just keeps growing. The hot money never seems to stop flowing.
https://www.marketwatch.com/story/th...ive-2018-07-18
7/19 Initial jobless claims sink to 48-year low – MarketWatch Obviously, everything is great.

7/20 Everyone is smart except Trump – Spectator
Kennedy resigned to open the door for Kavanaugh. Federal prosecutors are digging into every detail of Kavanaugh's past. They will eventually air out all the details of Vince Foster's death. The Dems are fighting the nomination BUT, the investigation will go regardless if he is nominated or not.
https://rense.com/general96/kavanaug...-cant-win.html
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Old 07-21-2018, 03:34 AM
Danny B Danny B is online now
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Re-ordering the power structure

Here is an excerpt from a comment on an article about re-ordering the power structure. Excellent article.

Bitcoin
The honey badger of money. Honey-Badger don't care. Some folks think Bitcoin requires the internet to work. Totally false. To settle a transaction from .01 to 1 Billion dollars, you need 256 bytes of information. You could write it on paper, mail it to a BTC node, and they would be able to send your arms dealer his payment, and nobody but him could use the transaction to get paid.

Ethereum
Now you can create a robot with money to spend. If he pays someone (your arms dealer) to do something, good luck to whomever brings conspiracy charges.

EOS
Just like Ethereum but instead of paying for each robot move, you buy some bandwidth. All you can eat ETH. Now you fire your arms dealer and replace him with a robot that can contact the arms manufacturers.

Litecoin
The backbone of the new transaction system, THE LIGHTNING NETWORK. Lightning replaces Visa Mastercard and SWIFT and allows instant settlement between Litecoin and Bitcoin.

Theta
YouScrewd and GnatFlix just lost their centralized stranglehold on content publication and your home cable box just replaced their massive server farms. Also, instead of paying for cable every month, now you pay a few hundredths of a cent when you watch and only then, but by hosting content on your cable box, you actually make more $$$ than you spend. Check it, the content providers have been begging Cox/TimeWarner to do this for years, and stop making them pay for ESPN. Too late. This is also the only way netflix-style service ever gets into the African Bush. Decentralize everything!

Blockchain In General
Everything a corporation can do, a Decentralized Autonomous Organization can do with 10% of the overhead. The CEO's Lambo is gone, and your costs drop by 90%. If you can figure this out today, and not 5 years from now, you can be the kid who bought Microsoft in 1978 for every industry. And you can give a BTC or two to a ponzi scheme in the process. Good luck.

https://www.zerohedge.com/news/2018-...nd-blockchains
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Old 07-21-2018, 04:14 AM
Danny B Danny B is online now
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Missing gold,,, panic in China

The Swiss have the reputation of being TOTALLY trustworthy when it comes to anything that involves banking. It appears that justification for this trust is a thing of the past. They are refusing to deliver gold that is held in allocated accounts. The high cost of the storage fees proves that the gold is allocated to the named customer. They no longer list bar numbers. The banks are so used to playing fast & loose with customer funds that they do the same thing with gold.
https://kingworldnews.com/wtf-is-goi...physical-gold/

7/21 The trade war could soon “go nuclear” – Casey Research
"China is currently our largest goods trading partner with $578.2 billion in total (two way) goods trade during 2016."
7/21 China firms went deep into debt. Here come the details – Washington Post
7/21 China’s P2P platform failures surge as panic spreads – Bloomber

7/21 Italian markets rattled after Tria’s future thrown into doubt – Bloomberg
7/21 EU fine will demolish Google’s earnings – MarketWatch


7/21 Russian gold reserves rise by another 500,000 ounces – SmaulGold
Notice that the States with the best intel services are all running to gold. They probably have a good idea of when the default cascade starts.
7/20 Prelude to a 2008 event — paper gold manipulation intensifies – GATA
The more that the price of gold is driven down, the more that China, Russia and Turkey buy it up.

Bernanke, Geithner & Paulson Warn - 'We've Forgotten The Lessons Of The Financial Crisis'
We actually never learned them.
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Old 07-23-2018, 04:30 AM
Danny B Danny B is online now
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China bust,,public pensions

The Bretton Woods agreement meant that all States had to work for dollars if they wanted reserve assets. In turn, they invested those dollars back into U.S. assets and U.S. Treasury bonds. Everybody sent their earnings back to us. We used this wealth to make war. America is still running on momentum from this arrangement and, the R.O.W. sends us about $3 trillion a year in fleeing capital. Since America is inflating the dollar at a FAR lower pace than many other States, dollar confidence remains. The more capital flight weak suffered by weak economies / jurisdictions, the more they have to inflate the money supply to avoid deflation of supply. This reduces confidence and, the process is self-reinforcing.

The whole world uses fake money and, it remains to be seen just how much longer this can go on. Don't forget contagion.
https://www.zerohedge.com/news/2018-...C0%2C0%2C0%2C1
7/22 Surge in global credit driven by China; deflationary bust coming – Mish
China is riding the credit dragon. If they don't feed it, it will eat them. The more that they print, the more deflation they get.
7/22 Six reasons why Credit Suisse is worried about China’s economy – Zero Hedge
7/22 War of words erupts between China central bank and Ministry of Finance – ZH
7/20 Asian shares rise as yuan slides by the most in 2 years – MarketWatch

Remember that when the Yuan falls, it is much more expensive to service dollar-denominated loans. Nobody wants to be left holding the bag.

The blob state is hard at work to preserve the only thing that matters to them.
https://www.armstrongeconomics.com/w...just-visiting/
"When interest rates decline, income from savings collapsed. So while the theory was to lower interest rates to “stimulate” the economy, the central banks have discovered a dark hidden secret — demand-side economics has utterly failed. Saving for retirement has failed. Your house has failed to provide a savings account and states are broke so they keep raising property taxes."
"Government pensions keep demanding higher taxes to exploit the public so government unions survive. In many states, the promises handed to union workers are bankrupting everything"
https://www.armstrongeconomics.com/h...or-retirement/

"According to the study, accrued liabilities—how much states are on the hook for—between 2003 and 2016 grew more than 50% faster than the economies in 28 states and more than twice as fast as GDP in 12 states. Leading the list are the usual suspects of New Jersey (4.3 times faster than GDP), Illinois (3.23) and Connecticut (3.18), as well as New Hampshire (3.46) and Kentucky (3.08).
Between 2003 and 2016, New Jersey’s pension liability ballooned 176%."
"Yet when the Illinois Supreme Court in 2015 blocked state pension reforms, the judges rebuked politicians for inadequately funding pensions. The solution, according to unions, is always to raise taxes. But no tax hike is ever enough because benefits keep growing faster than revenues."
https://www.dollarcollapse.com/publi...s-devour-host/

The Brexit spat is threatening to get very ugly.
https://sputniknews.com/europe/20180...-divorce-bill/
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Old 07-23-2018, 03:11 PM
Danny B Danny B is online now
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Bank profitability,,, Hierarchy of need

The productive loop of the economy has NO NEED of currency expansion above and beyond the level of expansion created by increased productivity.
Monetary inflation is strictly the province of bankers. The same is true for the State. It too must depend on currency expansion. Here is an article that lays out the current situation.

BOJ Offers To Buy Unlimited JGBs After Yields Surge, USDJPY Tumbles
So, their central bank offers to buy government bonds without limit.
"the BOJ is set to launch a full-scale investigation to mitigate the side effects of its yield-curve control policy on bank profitability and government bond trading, "
" Deutsche Bank complaining vocally about the ECB's policies) similar concerns have spread in Japan where both banks and pension funds have been agitating for at least some yield curve steepening to increase NIM and support bank profitability."
"another factor that is likely playing a key role is the ongoing decline in BOJ bond purchases, which both the bond and FX markets have so far been sternly ignoring."
The private sector refuses to buy all that stinky paper.

Here is a chart of 10 year yields around the world.
http://thesoundingline.com/wp-conten...-countries.jpg
So, as Powell raises rates he sucks capital away from the R.O.W. He endangers domestic U.S. debt with the higher rates. At the same time, he sucks in capital to U.S. markets. The 10 year interest rate is the battering ram that Powell uses to clobber The ECB and BOJ and PBOC. It also has a big effect on States like India and Turkey. Armstrong tells us that the U.S. bond market will be the last to collapse. This is quite a gamble.

Armstrong again, "Do not put equities in the same boat with bonds. The ship is sinking, but that is concerned with debt – not equity. Keep in mind that the collapse of a financial system has historically unfolded to different degrees."
That was before instant instant communication and instant capital transfer.
"n order for tangible assets like stocks, gold, art, antiquities, etc. to survive, the fundamental infrastructure must survive. That means there must be ample food for gold to have any value whatsoever. So you must stop short of the Mad Max event for anything tangible to have a safe haven value."
"he typical scenario painted by the doomsday crowd involves the German hyperinflation. However, that did not wipe out the structure of surrounding countries. This mean all tangible assets retained value because they could still be sold elsewhere."
The single currency area of the EU guarantees universal European collapse. American States has a single currency also.

"Therefore, if we are only talking about a reset of the world financial system, then tangible assets retain value that becomes translated into the new currency. Hence, equities will survive, government debt and currency will not. Only going all the way to a Mad Max event would everything lose value except food. Not even gold survives for trade comes to an end."
This is NOT true. Government debt and currency will die in the default cascade. Look at the many previous collapses. The hierarchy of needs starts with air, water and food. It moves up and includes dirt and seeds. From there it MAY move up to some level of luxuries. A basic shelter, tools and weapons. Remember that the collapse will erase a higher percentage of the wealth of the rich than it will erase of the poor.

If our energy intensive farming system fails, you will trade your Renoir for a bushel of rutabagas. It is only excess wealth that allows the production and sale of "An Orange Balloon Dog Sold for $58.4M"
If we slip down to the bottom of the hierarchy of needs, very few people will have the skills to survive. A global currency reset seems unavoidable.
When it all vanishes in a puff of smoke, what fraction of the hierarchy of needs will still be in demand?

" If everyone understands that we CAN SURVIVE this with society mostly intact ONLY IF WE UNDERSTAND what and how things unfold, then we have options once the crash and burn comes. We can stop short of a Mad Max event by understanding history, which is our road map to the future."
"The civil unrest we have beginning today post-Trump is intended to overthrow Trump and Obama has remained in Washington, which NO PRESIDENT has ever done. "
SIDE NOTE, Obama Ex National Intel Director Says Barry Is
Behind The Entire Russian 'Witch Hunt'

"Hence, this is a battle shaping up for the future; the final conflict over Marxism, which began with the fall of Communism in 1989. This final battle began 26 years from 1989.95."
https://www.armstrongeconomics.com/w...ip-is-sinking/

7/23 Disaster For Theresa May: Brits Overwhelmingly Reject New Brexit Plan – ZH
7/23 Australia’s version of the subprime mortgage crisis arrives – SMH
7/23 Emerging markets at mercy of falling Yuan as currency war looms – Bloomberg

The currency war is just a war of confidence. The Chinese print to feed the dragon. America raises interest rates to starve the dragon.
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Old 07-24-2018, 02:54 PM
Danny B Danny B is online now
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Speedbumps, pensions

Gresham's Law states that a bad currency will drive a good currency into hiding. Here is a perfect example. The Cook Islands produced a note that has gold in it. It is obvious that people will save it and put it aside. No fiat currency can compete with a currency of tangible value. This causes constant deflation of the circulating money supply.
Alt.Wedding For Gold Note | Thom Calandra's TCR Network
Fiat currency is fine if it isn't over-printed.

"ALL of this debt requires US bond yields to continue to fall. Put another way, in order for this massive debt bubble to be maintained the bond markets must make it continuously cheaper/ easier for the US to pay/ service its debts."
"As you can see, the yield on the 10-Year US Treasury has broken above its long-term trendline… in the WRONG direction. This chart is telling us that it has become more expensive for the US to issue/service its debts."
https://www.zerohedge.com/news/2018-...oing-wrong-way
Powell is raising interest rates to draw in fleeing capital. The above article shows the flip side of the effects of trying to draw in new capital. As the ten-year bond goes up, it becomes more expensive for everybody to service debts. America has the only printing press that turns out dollars. I suppose that Powell expects China to blow fitst,,, before America.

"Pension funds themselves have not been immune from the problem and are facing a financial crisis of their own. Per the OECD, the group’s 20 largest nations are facing a $78 trillion deficit in funding for public pensions. Even private pensions are not safe, with funds in the US only meeting 82% of their current obligations while gazing down a $3 trillion deficit."
The breakdown of the nuclear family meant that the old folks have to be supported with money rather than familial support. Private saving for retirement just didn't happen. The reset will be a disaster for anyone who can't go out and work.
https://www.zerohedge.com/news/2018-...turn-back-tide

A couple of years ago in Germany, demonstrators in the street were yelling, "Merkel to Siberia, Putin to Berlin. " Expressing their dis-satisfaction with Frau Merkel.
Kunstler proposes that America trade Trump for Putin to have somebody respectable leading America.
Russia Attacked Us - Kunstler

"Nixon and Kissinger ensured that all energy, and in consequence all other commodities, would continue to be priced in dollars. Global demand for dollars was assured, and the banking system of correspondent nostro accounts meant that all the world’s trade was settled in New York through the mighty American banks."
"Updated for today’s monetary system, this is precisely how the American government finances itself. Instead of printing notes, it is the expansion of bank credit, issued by banks licenced by the government with this purpose in mind, that ends up being subscribed for government bonds. "

"Von Mises reported that throughout the monetary collapse, until only the final months, there persists a general belief that the collapse in the currency would soon end, there always being a shortage of it. "
"it is not beyond the bounds of possibility for the dollar to initially lose between a third and a half of its purchasing power against a basket of commodities, and a similar amount against the yuan, which is likely to be managed by the Chinese to retain its purchasing power. It will be in the interests of the Chinese authorities to promote the yuan as a sounder currency than the dollar "
https://www.goldmoney.com/research/g...ollar-collapse
ALL currencies eventually crash. Gold will return after it's short vacation on the sidelines.

Understanding gold, https://safehaven.com/article/45806/...ot-About-Price

7/24 BOJ grapples with the difficult side effects of easy money – Nikkei Asian Review
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Old 07-25-2018, 04:52 AM
Danny B Danny B is online now
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Canadian debt

7/24 Southern California home sales crash, a warning sign to the nation – CNBC
7/24 The low-priced home shortage continues – CNBC
7/24 Less than 20% of apartments are affordable for middle-income black renters – MW

The builders built McMansions for everybody,,,, regardless of income.
Public pension survey, Overpromising has crippled public pensions. A 50-state survey | Wirepoints

Canada, China, Hong Kong Top BIS Worry List on Banking Crisis Risk story
11/29/2017 Canadian Households Most Debt-Heavy in the World story
11/17/2017 Canadians Paying Dearly for Their Housing story
11/09/2017 When Canadian Homeowners Walk Away From Negative Equity, Taxpayers at Risk

You Canadians are quite optimistic, Eh ?

"With more than $2 trillion in outstanding Canadian consumer debt today and flat wages, even using ‘creative’ financing, discretionary consumption had to hit the end of the cash flow tether."
https://www.financialsense.com/danie...wn-wrong-track
Good article,,, lotsa money,
CIA agent John Abbotsford stated “We run the Afghan opium trade.”
https://www.globalresearch.ca/heroin...heroin/5502813
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Old 07-26-2018, 04:20 AM
Danny B Danny B is online now
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More speed bumps

US Lawmakers to Introduce Bill to Sanction Russia's Sovereign Debt
It's only 6% of gdp ? Their stock market is doing great.
Germany, France, Italy become biggest foreign investors in Moscow's economy
U.S. sovereign debt is about 120% of gdp but, who really knows?
7/25 As Russia dumps its Treasuries, here’s what it’s buying – Zero Hedge
Dollar detox: Russia's gold reserves near 2000 tons to set historic ...
https://www.rt.com/business/434197-r...s-record-high/
Sanctioning Russian sovereign debt won't have any effect. Maybe that was the way that it was planned.

BRICS launches practical dialogue on mutual payments in national currencies
You get the idea that Trump is trying to de-globalize with his sanctions.
Most In US Support Latest Trump-Putin Summit
I guess that the tweet is mightier than the pen.

7/25 Tech stocks set to crater on Thursday on Facebook’s biggest drop ever – CNBC
7/25 Facebook tanks on earnings miss – TechCrunch

But, but, but, the FANGS are the irrepressible darlings.
Busting balls, 7/25 Trump secures concessions from Europeans to avoid trade war – CNBC
7/25 $12 billion: Trump bails out farmers hurt by tariffs – CNBC
Back in the '30s, all the farmers were going broke and losing their farms to the banks. Congress looked into this and figured out that there would be a HUGE national disaster if the banks took the farms.
7/25 Two giant US pension funds admit there’s a BIG problem – Sovereign Man No doubt.

NOBODY wants to take a good look at derivatives.
https://www.philstockworld.com/2018/...-shallow-dive/
7/25 Trade war will launch bitcoin as the new gold – Forbes Yeah, right
7/25 Venezuela’s inflation to reach 1 million percent – Bloomberg
Trump incidentally side-swiped NATO and blew them out of the water.
https://www.strategic-culture.org/ne...o-trumped.html
Merkel produced a feeble retaliation that was probably just what Trump wanted.
https://www.rt.com/business/434072-u...ndia-oil-iran/
The "art of the deal" is the art of manipulation.
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Old 07-26-2018, 02:45 PM
Danny B Danny B is online now
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The cost of the military (in)security complex

Most of you are aware that John Perkins wrote "Diary of an Economic Hit Man in 2004 about how the various international jackals go around raping the world. He later wrote an updated version where he claimed that 'they" were going after the biggest prise, America.
https://en.wikipedia.org/wiki/John_Perkins_%28author%29
"The objective of US intelligence is to suck all remaining wealth out of the US and its allies and pocket as much of it as possible while pretending to defend it from phantom aggressors by squandering nonexistent (borrowed) financial resources on ineffective and overpriced military operations and weapons systems."
"The total cost of wars so far this century for the US is reported to be $4,575,610,429,593. Divided by the 138,313,155 Americans who file tax returns (whether they actually pay any tax is too subtle a question), it works out to just over $33,000 per taxpayer."

"The 16 US intelligence agencies have a combined budget of $66.8 billion, and that seems like a lot until you realize how supremely efficient they are: their “mistakes” have cost the country close to 70 times their budget. At a staffing level of over 200,000 employees, each of them has cost the US taxpayer close to $23 million, on average. That number is totally out of the ballpark! The energy sector has the highest earnings per employee, at around $1.8 million per. Valero Energy stands out at $7.6 million per. At $23 million per, the US intelligence community has been doing three times better than Valero."

"Another hypothesis, and a far more plausible one, is that the US intelligence community has been doing a wonderful job of bankrupting the country and driving it toward financial, economic and political collapse by forcing it to engage in an endless series of expensive and futile conflicts—the largest single continuous act of grand larceny the world has ever known. "
https://cluborlov.blogspot.com/2018/...-collapse.html
This would be a mega blob state organization.
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Old 07-26-2018, 02:47 PM
Danny B Danny B is online now
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Wouldn't post, had to break it up

The possibility of A hard Brexit is starting to cause a bit of panic.
https://wolfstreet.com/2018/07/24/cl...-uk-regulator/
"The path ahead narrows to a binary option: the status quo either enters a crisis that can no longer be pushed forward with financial trickery or another systemic "save" emerges by 2024 - 2025"
Good article.
oftwominds-Charles Hugh Smith: When Long-Brewing Instability Finally Reaches Crisis

7/26 China can’t count on consumers to get through trade war – Nikkei
No kidding. All of a sudden, wages become important. China and India set the ceiling on wages. Viet-Nam, et al reinforced the ceiling.
Robby the robot is pressing down from above.
7/26 Here’s why Pakistan faces economic crisis, no matter who wins election – MW
Pakistan, like the Philippines has too high a birth rate and, too low an education rate.
7/26 Prepare for a Chinese maxi-devaluation – Daily Reckoning
Yes, Krakatoa in Beijing.
7/26 The Fed is on a collision course – Daily Reckoning
Did I mention that Powell was bring the ship-of-state up to ramming speed?

7/26 Did China start a currency war against the dollar? – Ken Rapoza
The short answer is, NO! The R.O.W. is in an economic war against Imperial America centered in Langley.
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Old 07-27-2018, 03:14 PM
Danny B Danny B is online now
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Deflation by evaporation,,, FB,,, The Great Alignment

My post just got zapped. I'm leaving Saturday
morning so, There will be a few days interruption. Current posts will be abbreviated.
Saudi Arabia Halts Oil Shipments through key waterway after attack on tanker
I've always claimed that the oil passages will be closed by the insurance companies demanding higher rates.
Top US Shale Oil Fields Decline Rate Reaches New Record...Half Million Barrels Per Day
A NEW record

Why EU Unlikely To Become 'Massive Buyer Of US LNG'
We charge 30% more.
Turkish Lira Plunges After Trump, Pence Threaten 'Large Sanctions' If Pastor Not Released
The Lira is crashing any way. We're just attacking because they plan to buy Russian weapons.
'Plague Of Rats' Heading To Britain Lets hope that they infest the House of Lords.

Facebook Loses $150 Billion - 20% Of Value - In 2 Hours Over Growth Slowdown Projection
Zuckerberg Loses 16 Billion In 5 Minutes As FB Shares Crater - Big Stockholder Calls For His Head

EVERYTHING is controlled by confidence. Nobody came in and stole $16 billion. We will see huge deflation of valuations. Many of these devaluations will be based on a loss of confidence in future business. This will be the source of our coming "deflation".

Dem Congressman Intros Bill To Stop Trump From Using Office To Enrich Himself & Family
That's UN-AMERICAN v
Feds Spending Watchdog Site Riddled With Errors
I'm SHOCKED , I tell you,,, shocked.
7/27 These American states are drowning in ‘irretrievable’ debt – Fox
So, it's no longer" unpayable", it is now irretrievable.
7/26 ECB sticks with promise to end stimulus despite growth wobble – Reuters
This means the death of Italian banks.
7/26 Yuan tumbles as China rages against Washington’s “extortion”, “demonization” – ZH
America has the only dollar printing press. The emerging markets have $13 trillion in dollar-denominated debt. We have apparently shut off this press.

Reportedly, The Great Alignment is on schedule.
https://www.armstrongeconomics.com/a...t-on-schedule/
"ANSWER: What these people who also tout gold will rise and nothing else fail to understand, is when confidence in government collapses, EVERYTHING rises. The Great Alignment appears to be on schedule."
I have to take issue with this. I'm not going to hold my breath waiting for wages to rise. If everything rises but wages, the working man will be much poorer.

https://www.theguardian.com/business...o-reveal-names
Rothschild Bank Under Criminal Investigation For Money Laundering ...
https://nworeport.me/2018/.../rothsc...ation-for-mone...
There seems to be a lot of investigation of people who were formerly untouchable.
Someone at B of A has a little side business,
https://sacramento.cbslocal.com/2018...tolen-drilled/
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Old 08-03-2018, 01:30 AM
Danny B Danny B is online now
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Large mixed bag

There is no possible way that I can catch up for time missed in Oregon.
I'll post some links with a heading for the subject.
A big bond fund suspended redemptions.
https://www.zerohedge.com/news/2018-...s-should-worry
The pension funds seem to have a $5 trillion shortfall.
https://www.zerohedge.com/news/2018-...japans-economy
Philly looking for tax money to cure mismanagement.
https://www.zerohedge.com/news/2018-...ty-owners-cash

Chicago is as crooked as you might expect.
https://www.zerohedge.com/news/2018-...ed-slush-funds
The corporate tax cuts are a last hail mary.
https://stephenlendman.org/2018/07/n...rporate-taxes/
A timeline of the disintegration of the Euro.
https://www.project-syndicate.org/co...r-sinn-2018-07
Greek debt is back in the news.
https://www.zerohedge.com/news/2018-...sustainability

It appears that Uncle Sam needs a lot of extra money after he drastically cut taxes.
https://www.zerohedge.com/news/2018-...d-133-trillion
John Hussman famously lost a LOT of his clients money from mis-calculating.
https://www.hussmanfunds.com/comment/mc180725/
"A moment’s thought should make it clear that valuation extremes like 1929, 2000, 2007 and today could never have emerged unless the market was able to entirely shrug off less extreme valuations along the way. When investors have the speculative bit in their teeth, as they did through the majority of the period between 2009 and 2017, valuations may exert very little effect on market outcomes, even for fairly extended segments of the market cycle. "
"Historically, regardless of other market conditions, one could adopt a negative market outlook once those syndromes emerged. Not this time. Not in the face of zero interest rates. Not in the face of post-election enthusiasm. This time, there was no such thing as “too much” or “too extreme.” One had to wait for market internals to deteriorate explicitly before adopting a negative market outlook."

"But valuations are not enough. It’s extreme valuation, coupled with deteriorating or divergent market internals (signaling a subtle shift toward risk-aversion among investors) that opens up a potential trap door."
"As I did in 2000 and 2007, I mean these figures seriously – not as hyperbole, but based on outcomes that would be historically standard, normal, and commonplace given current valuation extremes. At present, we project market losses over the completion of this cycle on the order of -64% for the S&P 500 Index, -57% for the Nasdaq 100 Index, -68% for the Russell 2000 Index, and nearly -69% for the Dow Jones Industrial Average."
"Presently, we expect a passive portfolio mix to underperform the return on risk-free Treasury bills over the coming 12-year period, "
YES, but, Armstrong said that Treasury debt is going to completely crash going into 2020. Keep in mind that ALL sovereign debt eventually crashes. In the interim , it is considered risk-free.
"Put simply, despite long-term economic growth, the real return on stocks can be zero or negative for very extended periods of time when measured from a valuation extreme like today "
Excellent article.

Chinese oil-futures contracts.
https://www.zerohedge.com/news/2018-...show-its-teeth
The FAANG stocks are turning ugly.
https://www.peakprosperity.com/blog/...comment-217259
The corporatocracy.
http://cafr1.com/TheWay.html
The new aristocracy. The 9.9%
https://www.theatlantic.com/magazine...ocracy/559130/
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Old 08-03-2018, 04:27 AM
Danny B Danny B is online now
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Markets floundering, revolution in Italy

"I have a rather simple Bubble definition: "A self-reinforcing but inevitably unsustainable inflation."
"China's central bank injected Rmb502bn ($74bn) into its banking system on Monday to help fortify a weakening domestic economy"
"Italy's Target2 liabilities rose $16.3 billion during June to a record $481 billion, with a two-month gain of almost $55 billion. It's worth noting that Italy's liabilities surged from about zero in mid-2011 to $289 billion at the height of the European crisis back in August 2012"
https://creditbubblebulletin.blogspo...agilities.html
The article talks about fragility in the Italian banking system. The Italian GOV is getting ready to blow the banking system to smithereens in it's search for taxes.
Revolution in 2020, https://www.armstrongeconomics.com/w...isis-for-2021/

"Amazon, Netflix and Microsoft together this year are responsible for 71 percent of S&P 500 returns and for 78 percent of Nasdaq 100 returns.

The three stocks make up 35 percent, 21 percent and 15 percent of S&P 500 returns, respectively, while making up 41 percent, 21 percent and 15 percent of Nasdaq 100 returns."
https://www.financialsense.com/chris...re-were-none-0
Investors know that the stock indices are a pile of hot steaming BS. They don't seem to care. Investors know that 95 million are NOT in the labor force. They just read the 3.9% unemployment numbers and, go with that.
The interest-rate death spiral, https://www.dollarcollapse.com/inter...iral-starting/

8/03 “Buffett indicator” says stock market primed for crash – Economic Collapse
8/03 Number of Americans living in their vehicles “explodes” – Economic Collapse
8/03 The Trump administration is headed for a gigantic debt headache – CNBC\
8/02 This ‘prophet of doom’ predicts stock market will plunge more than 50% – CNBC
8/03 Venezuela’s Maduro admits socialist model has failed – Zero Hedge

I guess that 1 million percent inflation is a pretty good indicator.
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Old 08-03-2018, 02:48 PM
Danny B Danny B is online now
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Borrowing money like there is no tomorrow

Armstrong, "This is why low rates in Europe have FAILED to stimulate demand when people lack confidence in the future, they will NOT borrow at any rate. Expectations of profit MUST exceed the level of interest rate before people will borrow. They function differently than governments which are addicted to debt and borrows all the time with no cyclical expectation."
Government has NO plan to repay what it borrows. It acts like a 10 year old with an unlimited credit card.
https://www.armstrongeconomics.com/m...r-than-europe/

"The mother of all credit crises is coming to China with over a quarter-trillion dollars owed by insolvent banks and state-owned enterprises, not to mention off-the-books liabilities of provincial governments, wealth management products and developers of white elephant infrastructure projects."
https://news.goldcore.com/ie/gold-bl...crisis-starts/
About that Dragon;
https://www.zerohedge.com/news/2018-...s-debt-service
A Record 18% Of China's GDP Goes To Debt Service

Canada is squeezing the taxpayer even harder.
https://www.armstrongeconomics.com/w...per-household/
8/03 Britain’s borrowing binge continues as Brexit looms – Independent
Congress Passes $716 Billion 'Defense' Bill For 2019

Yep, you max out your credit card when it becomes apparent that you can never pay back the debt.

8/03 Ministers accused of lying about Brexit – Independent
I'm SHOCKED, I tell you,,, shocked
8/03 “Buffett indicator” says stock market primed for crash – Economic Collpase
John Hussman fell for this one. It takes more than extreme valuations to bring on a crash. He came to the conclusion that extreme valuations MUST be coupled to a fall in investor confidence to finally crash the bubble. Since the CBs have been buying up everything in sight, the markets retain a picture of confidence. FED GOV continues to report totally BS labor and growth statistics and, the investors lap it up.
Eventually, fear will overcome greed. Meanwhile, FED GOV needs to borrow $1.3 trillion to buy another boatload of confidence.

The CB in Japan threw all caution to the wind and, eventually bought up 70% of exchange traded funds. They had been expecting enormous price inflation to go along with all the money creation. This did not happen. All the quantity of money theorists found that their theories just didn't work out. The money is stuck in the upper loop and does not cause much price inflation in the lower loop.
In about 500 years, somebody will "discover" that an economy can not have much price inflation when wages are static and the population is falling. Asset inflation is related to money printing. Price inflation is related to an increase in wages and consumptive power.
The low-wage economies have set a concrete ceiling on wages. They have impoverished their best customers and everybody is stuck on the bottom.
Just as no State can have a gold-convertible currency, no economic regime can afford to raise wages.

The blob state is millions of bureaucrats that are determined to keep their paychecks rolling in. NO tax is too high,,, no fine is too exorbitant. They have descended on Europe like a plague of locusts.
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Old 08-04-2018, 11:48 PM
Danny B Danny B is online now
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Bringing back trust, one block at a time.

The future is closing in on us and, I want to try to show you a glimpse of what is coming. British bankers started WW III (Churchill).
The Bretton Woods agreement was an attempt to forestall a new war later on driven by economic problems. Regrettable, Bretton woods depended on the honestly of politicians. For centuries, GOLD was the governor that kept sovereign States from super-inflating their sovereign bond market to initiate wars. They always had to go off the gold standard to have a protracted war. The gold standard is gone and, perpetual war is here,,, for now. The Automatic Earth has a very good article on emerging trends that will shape the future.
We have new tools for economic management now. Most of the early problems with diverse national currencies can by laid to rest with computers. I'm going to print most of the article and insert comments where necessary.

TAE
Over the last year or two there’s been discussion about the U.S. Federal spending moving beyond $4 TRILLION dollars, and whether a $1+ trillion dollar annual deficit, on top of a $20 Trillion national debt – Federal only – is sustainable. It isn’t.
what will we replace it with when it very soon doesn’t? Historically gold.
Because at a time of broken promises — real goods, commodities that can be seen, touched, and used – are the tangible proof of wealth, requiring no trust, and from which the human trust system of paper and letters of credit can be rebuilt.

Before WWI, the world was on the gold standard. This had variations, exceptions, corruptions, but on the whole there was gold in the back that was fronted by paper promises issued by private banks. The paper moved, the promises were delivered by telegraph and telephone, and the gold remained in the vaults. It was only when men felt unsure of the truth of the promise they could and did demand delivery, called the bluff, and the bank did – or ominously didn’t – deliver the gold, and thereby keep the paper system in line with reality, with real wealth, and with the economy. This method kept men and nations honest, mostly.

they began to cheat, double-counting the gold on their books to relieve the pressure. And so the non-gold system began.
The inflation was shown to be a fraud supported by the highest powers in government and finance, and the real economy withdrew their lack of trust until the matter was fixed
To have assurity of access to that oil — and not run afoul of the U.S. military – they (Saudi)needed to keep a substantial portion of their national accounts in US$, or more technically U.S. Treasury debt, sparking not just the ability, but the REQUIREMENT of a massive U.S. deficit.
The volumes of US$ grew to trillions while the gold component withered to billions, yet still the Saudis banked billions in gold before it was recently stolen from their Swiss accounts

Because there is still no trust between nations and billionaires who have a long history of cheating each other. The gold-in-hand safety valve existed to retain some trust, however distant, in the now-digital system.
CONFIDENCE
Apart from the Iraq war, the price of oil has been stable for 50 years. In 1950, two silver dimes would buy a gallon of gas. In 2018 two silver dimes are worth $2.22, or the price of a gallon of gas, minus the new taxes. Meanwhile the US$ value has dropped steadily:

If the old currency burns as predicted 30 years ago, what next? Will it be replaced by a gold coin or a “zero” coin, chained under the fleur-de-lis? It would seem the new currency must be trusted, which is the original problem, must be a replacement in trade, and must be large enough to handle what are now multi-billion trade and multi-trillion Forex flows. Is the answer gold? Well yes…and no. Certainly China thinks so:
The transactional currency can never be used as a a store-of-value.

A 9-fold increase in ability versus 20,000-fold increase in promises. Sounds like someone won’t get paid. And you know what bankers and economists call that?
Default. Massive, system ending default, the size of WWI or the Great Depression. That’s how fiat standards end.
$3 Trillion in gold. Now that’s “official” gold and we already showed that “official” Chinese gold is 4,000 tonnes when it may be as high as 30,000 tonnes, but the principle is the same: gold is wildly smaller than the needs of the financial system. Or is it? In previous financial inflations…which I just showed we have had since 1971, in 20,000x scale…gold simply rose until it became the right size.
FOFOA shows good logic to believe that gold will eventually settle in to a price that has the equivalent purchasing power of $55,000 an ounce.

It’s perfectly simple. Gold rises 20,000 times or however much it must to re-back the system. It always has before, even in 1979 when the price rocketed from $35 to $880 where US debt to gold holdings ratio stabilized at a very reasonable 10:1…the classic level of fractional reserve trust. If China officially owns 5,000 tonnes, and Russia 2,000, with the west also 15,000 collectively, we have 22,000 tonnes over what BusinessInsider says is $160 Trillion in assets, and you get $7.27B/tonne or $226,000/oz.
Not that simple but, go on.

With 40 years of inflation and very little comparative rise in gold, why shouldn’t it catch up as it did in 1979? So gold will rise and we’ll have a $200,000 gold standard? That’s what will happen?

Not so fast. We COULD have a gold standard, and China, Russia and other major nations appear ready to do so if necessary, but remember we didn’t return to the gold standard last time either.
Gold backed sovereign bonds, NOT currency. Remember, it is inflation of the bond market that is utilized to finance wars, not currency inflation.

The two problems in the original chart are trust and price. The price must restore a connection between reality -real value and real production- and price; and the “reserve currency”, the medium of exchange, must be a trusted agent or method.
Today the mass of trade is in goods to and from China. But China isn’t large enough, deep enough, or trusted enough to be the new world currency. And why should they? The reserve currency is what just hollowed out and bankrupted the United States: they would just be imitating our faults. We’d also be moving from one untrusted, unbacked currency to another, and history says that doesn’t happen.

China demands not US Treasuries in NY as collateral to ship goods as presently, and not Yuan bonds, but gold bullion posted in their hot new Shanghai market, which allows physical delivery on demand. This bullion never moves as collateral, but is simply posted by one party then released on delivery.

Even though Shanghai is a “third party” allowing delivery, who’s to say they will be tomorrow? The banks are notorious for “hypothecating”, doubling, tripling the gold on their books with accounting fraud backed by the full faith and credibility of governments, and no one’s in the mood for trusting the Chinese any more than Wells Fargo or DeutscheBank. That would drop us back to a hard gold standard, a $220,000 price, a halt to world trade, and possible world war we were trying to avoid. We need an accounting method that is better trusted and can’t be gamed. How to fix it?

An original audit, adjusted for receipts and deliveries is all we need. Which is where we add the blockchain. With it, Shanghai cannot double the gold on their books like Europe did in 1922 or the CME does today, marking it both received and loaned, because the blockchain only allows one position, one state at a time.
Gold assayed and entered by refiner is tagged to a kilo, and you can follow that kilo bar through the system, not with double counts and vanishing, ever-changing serial numbers as the Federal Reserve and the GLD ETF showed.

What will happen to the Dollar? It will still exist, but in some new, revised form. But the US$ today is transferring 3% of the nation’s wealth from the poor to the rich via inflation. Do we really want to keep it?
The dollar will be our national currency, still diluted and still referring to the real currency: gold, the attached Trade Note, and its crypto accounting.
https://www.theautomaticearth.com/20...d-yuan-crypto/

Jim Willie, "the emerging Systemic Lehman Event in a global financial crisis during the climax global breakdown underway, as nothing was resolved since 2008 while all major sovereign bonds have turned subprime and many banking systems in ruins, the gradual installation & implementation of the Gold Standard from the many substantial Eastern endeavors, where the United States must source the gold for a new gold-backed currency with the ongoing concurrent risk from the $600 billion trade deficit, which must be eliminated, "
"Three requirements stand as critical in establishing the Gold Standard for the USDollar. They will be extremely difficult to implement and to satisfy. Several giant treasure troves of gold are coming to the fore. They can potentially alter the global financial setting in a significant way."
GOLDEN JACKASS.COM - The Golden Jackass Knows Gold, Currencies & Bonds"

The whole system is expected to blow. We live in a multi-polar world, NOT a post WW II world. America will NOT be dictating the shape of future world finance. There will be NO move to a gold trade note and / or gold backed sovereign bonds until it all comes crashing down. The current lock on finance held by the FED will NOT go quietly into the night.
Bretton Woods depended on trust in politicians. The world will NOT make that mistake again.
One (blockchain) to rule them all.
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Old 08-05-2018, 12:19 AM
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BroMikey BroMikey is online now
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Quote:
Originally Posted by Danny B View Post
The future is closing in on us and

The whole system is expected to blow.

The current lock on finance held by the FED will NOT go quietly into the night.
I wonder how much extra cash will be in hand after pedophiles in Rome
have all of their assets taken away and put into US banks, oh and the rest
the people in the mob, ISIS and more get their's ceased?

We are talking trillions. The USA has declared marshal law on serious
human rights violator WW. The corruption in congress and all forms
of govt are wealthy thru trafficking.

Time is up, time to pay up and the banking system will return to a more
stable system.
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Old 08-05-2018, 07:28 PM
Danny B Danny B is online now
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The very small future of the banking industry

Most of the banking system is just going to disappear. It is inefficient and archaic. Something like Blockbuster
Banking was invented to get around some bottlenecks.
"Coincidence of wants is the reason that money is so important in an economic system. Or rather, I should say money is important because it is rare to have a coincidence of wants. Coincidence of wants occurs when two people have goods or services that they want to trade with one another."
Enter the computer.
The Exploding Business of Bartering - Harvard Business Review
https://hbr.org/2012/09/the-exploding-business-of-bart
Sep 12, 2012 - Companies are bartering everything from cars to jet fuel to legal services. ...
Banks were used to store excess wealth and put it to work in the form of loans. They long ago left this behind. After the default cascade, nominal paper wealth will be reduced by at least 90%.

SS graph, http://media.peakprosperity.com/imag...2018-07-20.jpg
FED GOV interest payments, http://media.peakprosperity.com/imag...2018-07-20.jpg
https://www.peakprosperity.com/blog/...rica-insolvent
Reportedly, Powell is trying to slowly deflate the bubble.
https://www.zerohedge.com/news/2018-...-jerome-powell
Just wait until China and the Eurozone hit the wall.

8/05 Fed accelerates QE unwind – Wolf Street
8/05 Pensions running out of solutions — who foots the bill? – Birch Gold
8/04 US multiple jobholders soar 453,000, highest since 1999 – ZH

Everybody is selling tacos out of the back of their car.
8/04 Americans’ real earnings slump most since 2012 – Zero Hedge
8/05 “Totally freaked out” Brazilian elite fleeing bloodshed and chaos – Zero Hedge

Give it time and, you won't have to travel to Brazil to see this chaos.

"Before Keynes there were macro considerations, which were firmly grounded in human action, the personal preferences and choices exercised by individuals in the context of their own earnings and profits. In order to give a role to the state, Keynes had to get away from human action and devise a positive management role for central planners. "
https://www.goldmoney.com/research/g...efcode=dollarc
It took a while but, that idea is blowing up.
"With sound money, that is money that is gold, or substitutes that are fully backed by physical gold, human behaviour is self-correcting through the price mechanism,"
https://www.goldmoney.com/research/g...efcode=dollarc
The State doesn't want any "correcting".
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Old 08-06-2018, 03:00 PM
Danny B Danny B is online now
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Exporting unemployment

We think that America is falling apart. Foreigners like Brazilians want to come here because everything is great. The same is true for the U.S. dollar. It looks great compared to all the rest. Capital flight keeps pushing the dollar higher. As the dollar goes up, employment falls. Trump wants a weaker dollar but, the markets have other ideas. At the core of everything, a weaker currency exports unemployment. A.I. and robotics are chipping away at job niches and the State is desperate to hold on to whatever jobs are still left. At the same time, we have a falling population of consumers and an enormous SKILLS GAP.
There is no solution for efficiency and, automation will continue to chip away at employment. The coming crash of FED GOV in 2020 will put millions on the street who depended on the State to provide make-work to keep them behind a desk. For the time being, every State is trying to export unemployment.
https://www.jpost.com/International/...h-China-564069

Kunstler, "In case you are mystified as to why a considerable portion of the public is disgusted with the news media, it is as simple as this: they appear to be an instrument of that permanent government bureaucracy, doing its bidding, defending its criminal mischief, and covering up its dishonesty. Proof of that is the media’s conspicuous inattention to the now well-documented political depravity in another arm of the Intel Community, the FBI — a much more compelling story of villainy than 13 Russian Facebook trolls and the alleged (still unproven) hacking of the DNC.

Donald Trump, aka the Golden Golem of Greatness, may be an unappetizing and embarrassing president. But is the Deep State ready to start a world war just to shove him offstage? Or burn down the constitution? While CNN stands by with Jeri-cans of gasoline?"
Light It Up? - Kunstler
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Old 08-07-2018, 04:40 AM
Danny B Danny B is online now
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Who knows how much money is going where?

Interest rates are the big bugaboo right now. Trump wants them held down. Remember that low interest rates wipe out, investment funds, pension funds, insurance funds, savers AND banks. There is a good reason that ZIRP is "never" done. It is just too destructive. Like drinking cheap tequila, the follow-up pain just isn't worth the high. Trump needs to keep in mind that bond buyers will go on strike if they feel that interest rates are too low.
https://dailyreckoning.com/trump-tak...xons-playbook/

The Quantity of money theorists / believers are having a hard time.
"Abe rode to power in December 2012 by promising muscular leadership, and by selling voters the idea that Japan’s demographics didn’t have to be its destiny: An aging, shrinking population is no reason to accept a smaller economy every year."
"April 2013, Kuroda has expanded the central bank’s holdings of government bonds and bills to 48 percent of outstanding securities, from just 12 percent. He has also made the BOJ one of the top 10 shareholders in 40 percent of Japanese publicly traded companies, "
"A year and a half of that experiment — not to mention more than 20 years of zero interest rates preceding it — has gone nowhere. "

" What’s required is a public-sector push to replace all physical cash with a national digital currency."
"A state-backed digital currency would make it easier for the BOJ and the finance ministry to run “helicopter money” experiments. The BOJ would create new electronic money and give it to the government against a perpetual bond sold by the finance ministry to the monetary authority. 1 The ministry would then credit the electronic money to people’s bank accounts with the proviso that every month that the gift is saved — and not spent — its value will go down by, say, one-twelfth of 1 percent."
"The BOJ could eventually make helicopter money its main policy tool,"
https://www.bloomberg.com/view/artic...n-abolish-cash

Jun 4, 2018 - Japan's population is shrinking by more than 1000 people per day.
How Japan's ageing population is shrinking GDP | Financial Times
https://www.ft.com/content/7ce47bd0-...e-41e0209208ec
Feces-for-brains planners have overlooked the problem of babies.

Good article from the Mises institute.
"some of the borrowed money is simply not included in the deficit. For example, in fiscal year 2016, they claimed a deficit of $587 billion even though the total debt increased $1,422 billion "
" They hide some of the deficit by simply declaring that some of the increased debt is not part of the deficit."
"The Treasury Department with their Daily Treasury Statements (DTS) gives us an accounting of all deposits into and withdrawals from federal government accounts. The DTS shows that withdrawals more than tripled from $4,036 billion in FY 1998 to $12,995 billion in FY 2017. "

If we define spending as total withdrawals from government accounts, then FY 2017 spending was $12,995 billion and government spending is 67% of GDP.
"That’s right. The federal government paid $8.43 trillion in debt redemption payments in FY 2017. That’s ten times the Social Security Benefits paid out ($842 billion). Not counting these payments when reporting government spending is the chief reason that federal spending is reported to be 20.5% of GDP."
"However we must recognize that debt payments are a form of government spending and the fact that the feds must finance this spending. Due to the principal payments on the debt, 77% of federal spending is financed by borrowing."
Ah yes, about those tax cuts.

"Government spending is 67% of GDP."
"federal spending is reported to be 20.5% of GDP."
Now you see why interest rates must be held down. The bond buyers will run away when they perceive that federal debt is too high to service.
8/06 Jamie Dimon warns of 5% Treasury yields – Bloomberg
8/06 Bankruptcy booms among older Americans – New York Times
8/07 Vanished wealth: Baby boomers filing for bankruptcy in droves – ZH

"Nearly half of Americans say their expenses are equal to or greater than their income.
That leaves 60% of Americans who spend about equal to their income (38%) or who spend more than their income (18%)."
I know guys who spent $70,000 on a pickup truck they didn't need. No tears for them.

8/07 Banks ease lending standards just as loan bubble shows signs of bursting – ZH
The default party will be much bigger this way.

"The net result is whatever actual "growth" has occurred (removing the illusory growth that accounts for much of the GDP "growth" this decade) has flowed almost exclusively to the top of the wealth-power pyramid (see chart below)."
That GDP growth seems to have been accomplished with GOV money, "Government spending is 67% of GDP."
The U.S. Government To Fork Out A Half Trillion To Service Its Debt In 2018
"bogus "growth" story without question because that story is the linchpin of the entire status quo: if it's revealed as inaccurate, i.e. statistical sleight of hand, the whole idea that "growth" can effortlessly fund all future obligations goes up in flames."
8/06 U.S. bond market takes looming Treasuries deluge in stride – Reuters
It seems likely that US GOV is doing the buying. According to Armstrong, the flames will hold off until 2020.

"6. The core constituencies of politicians are government employees and contractors, as these interest groups are funded by the government, which is nominally managed by elected officials and their appointees. Nobody's more generous (or demanding) than those feeding directly at the government trough. (By "contractors" I mean the vast array of Corporate America cartels that feed off government spending: defense, Big Pharma, Higher Education, etc.)"
Hegel would love this arrangement.
"Once the asset bubbles pop, the illusion that "taxing the rich" will pay for all the obligations pops along with the bubble. "
"That 20% is an interesting threshold, as once federal tax burdens rise above 20%, the higher taxes trigger a recession which then crushes tax revenues."
Good article, oftwominds-Charles Hugh Smith: We'll Pay All Those Future Obligations by Impoverishing Everyone (How to Destroy Our Currency In One Easy Lesson)

In 2008, America stopped believing in the American Dream – Frank Rich, NY Mag
Facebook wants to "friend" your bank account,
Facebook Asking Major US Banks To Share Users' Financial Data
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