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$278 trillion of interest-rate-derivatives go through clearing houses. Gary Cohn believes that they will be the focus of the next crisis.
Gary Cohn fears clearinghouses could be to blame for the next financial crisis - Oct. 17, 2017
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https://www.silverdoctors.com/headli...ollars-toilet/
$278 trillion of interest-rate-derivatives go through clearing houses. Gary Cohn believes that they will be the focus of the next crisis.
Gary Cohn fears clearinghouses could be to blame for the next financial crisis - Oct. 17, 2017 -
The West mistakenly thinks that China will / must put on the brakes for credit creation. That was never their intention. Their long-range plan is to come out on top. Jim Willie reports that China has used currency swaps to get rid of the last of their dollars. Russia has just amped up their gold buying.
U.S. debt is reported at 105% of GDP, NOT counting $213 trillion of unfunded liabilities. Russian debt is reported at 18%.
Margin debt is astronomical. Nobody can make good in case of a default. Clearing house debt is a few orders of magnitude larger. There are NO counterparties that can cover a chain of default.
In the case of a default cascade, nobody will trust anybody. At the start, traders will have to put physical gold into escrow until a trade clears. Credit will gradually be revived but, only for parties that have proved themselves trustworthy.
China is in the catbird seat and will quote all prices in gold-ounces, NOT in Yuan.
"For example, average dailyComment
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Bankers revolving door,,, 10 triggers
Here are 2 articles about the revolving door between the finance industry and government.
SEC Hires JPM Banker As Its Most Important Markets Regulator; May Blow Up HFTs | Zero Hedge
Even when the banks get a big fine,,,, they are often allowed to deduct it from their taxes.
Paralysis and shutdown may be on the menu, Here Are The Reasons Why Another Government Shutdown Looms | Zero Hedge
NOBODY is filing for unemployment benefits so, obviously, EVERYBODY is employed.
Initial Jobless Claims Crash To Lowest Since 1973 | Zero HedgeBofA Lists 10 Triggers For The Next Crash: "It's Coming Between Thanksgiving And Valentine's Day" | Zero Hedge
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The World's Largest ICO Is Imploding After Just 3 Months | Zero Hedge
The CBs create debt-bonds for the State but, the taxpayer has empty pockets. While the FED and ECB are loathe to create more debt bonds that can never be repaid, they are joined at the throat with the State. If the central government collapses, what is the fate of the central bank?
US Gross National Debt to Spike by $800 Billion in October? | Wolf ...
Aug 21, 2017 - In the two weeks after the debt-ceiling increase, it soared by $520 billion.
So, the FED can talk up a good story about reducing it's balance sheet.
The U.S. GOV / CB creates a new dollar of money for the system. In early days, this new dollar of debt created a few dollars of new wealth. About the mid 60s, this had shrunk until a new dollar of money only created one dollar of new wealth. It now takes as much as five dollars of new money to create one dollar of new wealth. Since the 60s, the FED has been financing consumption rather than wealth creation. The FED might like to extricate itself but, all the beggars, bankers, bureaucrats AND war-mongers want the party to continue. BUT, they want the party to continue for current partiers. That is why the pension systems are not funded.
Presumably, the party will continue until all this wet-ink money no longer flows into State debt markets.
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I click on the link and all I get is
AMERICAN MADE - 'The Real Barry Seal' Featurette
AMC Theatres
AMC TheatresComment
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Originally posted by Danny B View Post
Why Cryptocurrency Is a Perfect Vehicle for Crime
b4rry s34l
AlComment
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BTC and some kind of new reality,,
Re: Why Cryptocurrency Is a Perfect Vehicle for Crime
It is arguable that the state is the biggest criminal of all. The bankers are probably second. They have completely vertically integrated drug production and distribution. The result,
"Heroin-related deaths increased 439% from 1999 to 2014. As of 2014, heroin-related deaths had more than tripled in five years and quintupled in 10 years."
This is America on drugs: A visual guide - CNN
As long as the bankers and CIA are running the drug business, I'm not particularly worried about criminals using BTC.
How a big US bank laundered billions from Mexico's murderous drug ...
https://www.theguardian.com
I can easily forget about the threat of criminals using BTC.
Moving on, The articles on the net are getting more and more analytical about BTC. They are getting more and more interesting.
This guy REALLY knows his stuff, "95% of cryptocurrencies are scams."
"First there was barter. Then there was gold. Gold first solved many of the problems of barter (reducing thousands of exchange rates to just a few). Then there was paper money/bank money/fiat money. Paper money solved many of the problems of gold (e.g. as a store of wealth that you can travel with, or as a transaction mechanism for large transactions).
Now there are cryptocurrencies. And cryptocurrencies are solving major problems in fiat money (no centralized control, lack of human error, no forgery, privacy, etc etc)."
"Back to the main point: the $200 trillion in cash, money and precious metals used as currencies in the world will eventually be replaced by cryptocurrencies, which only total $200 billion today."
It just doesn't work that way but, go on.In essence, the borders of a State are defined by/ limited by it's taxing power.
If the State changes over to a crypto currency from a paper currency, you can bet that it will want a sovereignThat can't be true, QE ended years ago.
"On Friday the S&P 500 and the Dow and the Nasdaq carved out simultaneous records, marking the 24th time in 2017 that that feat has occurred." GREAT news.
But, like Killary says, "it was worth it." https://sputniknews.com/us/201710201...ntagon-global/
Canada is finding new ways to help the "poor", https://www.armstrongeconomics.com/w...-wage-earners/
This is a cross post, https://www.silverdoctors.com/headli...h-rotten-frui/Comment
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. Lending was led by booming demand for household real estate purchases. Total Chinese Credit could surpass $4.0 TN in 2017, easily outdoing U.S. Credit growth at the height of our mortgage finance bubble. "
Credit Bubble Bulletin
President Xi inflated the snot out of credit, planning to survive until he could consolidate his power in the congress.. Here is a graph of actual growth.
"For example, the rise of the shadow banking system, which operates beyond the regulationsChinese Economy and Gold :: The Market Oracle ::
China's real gdp is crashing and, coincidently, China's labor force is shrinking. http://conceptnewscentral.com/wordpr...rs-decline.jpg
Xi is going to have his hands full trying to grow the economy while the population is falling.Comment
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It's the Koolaide.
MAULDIN: Investors Ignore What May Be The Biggest Policy Error In History | Mauldin Economics
"Take for example the hundreds of trillions of dollars-worth of underfunded entitlement and pension promises. Those promises cannot be kept and they cannot be paid. Everybody with a basic comprehension of math can conclude as such.
Yet we continue to operate as if the opposite were true. We comfort ourselves that, somehow, all the promised future payouts will be made in full -- even though the funds are insolvent"
Congress approves plan to allow pension cuts (Dec 2014)
273,000 union workers and retirees brace for pension cuts (May 2, 2016)
In unprecedented move, pension plan cuts benefits promised to retirees (Jan 27, 2017) -- note the laughable use of "unprecedented" here
Teamsters face 31 percent pension cut (Mar 7, 2017)
New York State Teamsters pension fund cuts approved (Sept 13, 2017)
"Health care premiums for 2018 set to go up by as much as 50 percent
Oct 5, 2017
Several states have announced rates for health insurance premiums on the Obamacare exchanges for 2018. Topping the list is Georgia, with rates that are 57 percent higher than last year"
"The average family health care insurance premium in 2016 was $18,764"
As long as the military is well funded, the rest doesn't matter.
"The United States marks the 16th anniversary of the war in Afghanistan. A new report shows the federal government may have misplaced $21 trillion in the last two decades. "
"Behind all the smoke, mirrors, Trump bluster, Schumer fog, and media mystification about the vaudeville act known as The Budget and The Tax Cut, both political parties are fighting for their lives and the Deep State knows that it is being thrown overboard to drown in red ink. "
Will that be ink or blood?
"Alas, Mr. Trump has not constructed a coherent strategy for defeating the colossus of fakery that drives the nation ever-deeper toward the cold and dark."
"The revolution to come out of this frozen swamp of irresponsibility will be the messiest and most incoherent in world history."
Into the Cold and Dark - KunstlerLight It Up - KunstlerComment
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Bots,,, using the blockchain to combat fraud
Max Keiser does a rant about artificial intelligence wiping out employment in the finance industry. https://www.youtube.com/watch?v=rHgbAh0jgNs
He isn't the only one who sees a future where the best man for the job is a machine.
EquBot has been let loose. The sequence of pictures are priceless.
First A.I. ETF Claims It Can Replace An Army Of Research Analysts | Zero Hedge
AlphaGo Zero will soon make all of our puny efforts look even punier, Google creates AI that can teach itself and 'isn't constrained by the limits of human knowledge' | The Independent
Even captain Kirk had big problems like this, https://www.youtube.com/watch?v=vzuIijxHBh0
Manna, " "Yesterday the people controlled the computers. Now the computers control the people. You are the eyes and hands for this robot. "
Manna, Chapter 1, by Marshall Brain
https://cdn-images-1.medium.com/max/...b0ShprxVFA.png
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Automatic Earth
All I can say is; read the article AND every word of the comments.
The comments carry as much import as the article.Comment
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Blockchain and the Mafia
Putin was adamantly against crypto currency. One week later, he did an about face and endorsed them. The blockchain promises "perfect" transparency and accountability. Who would that hurt?
The SDR was created in the 70s and never caught on. An SDR, just like gold is NOT expansive. Paper-gold was created in the early 80s so that the gold supply could be expanded. BTC is VERY expansive and holds great interest of traders. BTC is the beta-test for CB crypto currencies. There are currently about 1,000 coins. They perform different functions. This is in addition to the various functions of the blockchain that could be integrated into contracts and finance.
As each application is attracted to it's best niche in the physical economy, it will stabilize. After a "certain" level of stability is reached, that application / niche will be transferred to State control.
The State always writes the rules in IT'S favor. The State isn't going to give up taxing authority. As transactions move to the blockchain, organized crime will find it ever-more difficult to take a cut. HOW DO YOU SHAKE-DOWN SOMEBODY IN A CASHLESS ECONOMY? Now do you pay bribes if all transactions are recorded on the blockchain?
Chinese exporters sell / ship 1,000 widgets and bill the receiver for $1 million. They true price is only $1/2 million. The receiver credits the sellers overseas account for $ 1/2 million. This is the main way that money is transferred offshore. The blockchain will make even this more difficult.Comment
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Capital inflows and the stock market
Armstrong made it clear that you can't understand the economy if you don't understand international capital flows. Chinese capital is inflating the price of houses from Vancouver to Melbourne.
I can only make things just so simple. I can only break them down just so far. There is too much complexity.
Global wages have been massacred. The velocity of money has stalled out. The ultra rich have all the money but, they do little in the way of consumption. The consumptive loop is starved for consumption. The speculative loop can't do anything but,,, more speculation. The CBs just keep printing more debt money to make up for the profits that are not being realized.
It's not so much that wage inequality is BAD. The problem is that many millions of people don't even have enough to eat. The poverty rates are climbing fast.
"total U.S. household net worth, and every quarter for the past two years this number has steadily gone up, hitting fresh all time highs with every new release, most recently $96.2 trillion"
"bottom 90%, who remain largely locked out from such gains."
"Today, none other than Bridgewater's Ray Dalio focuses on this topic, which he calls "the most important economic, political and social issue of our time", and defines it as "the two US economies"...
"America, some 50% of households, own just 1% of the country's wealth, down from 3% in 1989"
"Since 1980, median household real incomes have been about flat,"
"Only about a third of the bottom 60% saves any of its income (in cash or financial assets). As a result, according to a recent Federal Reserve study, most people in this group would struggle to raise $400 in an emergency."
Americans, in particular, are very poor at saving for retirement. Uncle Sam came along and demanded part of our wages so, he could do the saving for us. Uncle Sam became entranced with the idea of empire and, he spent all of our savings. We don't even have a decent rail system.
"Death rates are rising and mental and physical health is deteriorating for those in the bottom 60%. For those in the bottom 60%, premature deaths are up by about 20% since 2000.
The biggest contributors to that change are an increase in deaths by drugs/poisoning (up two times since 2000) and an increase in suicides (up over 50% since 2000). "
Ray Dalio: "This Is The Most Important Economic, Political And Social Issue Of Our Time" | Zero Hedge
Ray says that "we" need to do a big wealth transfer, https://www.cnbc.com/amp/2017/10/23/...ealth-gap.html
Global capital flows;
Here is a long, well thought out article explaining why stock markets are safer than bond markets.
October 2017 IceCap Global Outlook - "Should I Stay or Should I Go?" - IceCap Asset Management Be aware that the article is full of lies.
We know that stock markets are on a tear upwards. Could this continue?
The Swiss national bank recently bought $80 billion of U.S. stocks.
Armstrong, "Our Capital Flow models have been spot on showing the strength of the rally in the Dow is driven by foreign inflows
The U.S. stock market is attracting capital because it is the best looking horse in the glue factory. What about the worst looking horse?
Macron plans to TAX the snot out of everything in Europe. Don't forget that every additional Euro of tax diminishes the producing economy by about 3 Euros.
So, will the foreign inflows allow the market to keep going up for a while?
Venezuela has two big bond payments in the next few days. "The collateral against the bond is Citgo, PDVSA's Houston-based refining and retail subsidiary."
The Chinese prefer land and RE as a store of value. Their savings were channelled into RE and now, there are many millions of commercial and residential buildings that nobody can afford to occupy. The Chinese GOV has a solution.
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It's a very strange world where high-risk bonds are trading at the same rate as U.S. Treasuries, http://www.zerohedge.com/sites/defau...023_gund_0.jpg
It is impossible to say just how long the Cbs can keep interest artes down, Gundlach: "The Order of The Financial System Is About To Be Turned Upside Down" | Zero Hedge
"This means the on and off balance sheet assets for Chinese banks total 232 trillion plus 253 trillion." Just keep in mind that these assets are debt notes.
"The absolute size and growth of assets imply there will be enormous (as in Biblical) costs to deleverage."
" by 2025, China will have financial system assets equal to approximately 1,900% of nominal GDP"
" To provide some perspective, residential real estate in China is 38% more expensive on a price per square foot basis (than U.S.) but nominal per capita GDP in the United States is 608% higher. " Simple, the Chinese can't afford to buy a Chinese house.
Everything We Think We Know About Chinese Finances is Wrong | Balding's World
He sounds like Buzz Lightyear
Why grid failure will come faster than we think.
I wish both of them good luck. We'll finally get some good encryption.Comment
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