Economic pressures

[Danny B]

Sr. Price,,, Butler,,, Hudson

Sr. Price and the Assignat; .:Plata:.http://www.24hgold.com/english/news-...hn+Butler&mk=1

EXCELLENT article from Michael Hudson. A great explanation of the multitudes of parasites.
Michael Hudson on Debt Deflation, the Rentier Economy, and the Coming Financial Cold War | naked capitalism

[Danny B]

Too much oil

Energy is the master resource. The banks piled into energy for the huge returns. But, they overdid it on the greed angle. They have more oil than they know what to do with; Why Oil Prices Are About To Plunge Again: 31 Million Barrels In Floating Storage Are Coming On Shore | Zero Hedge

It is obvious that oil will go / stay down for a while. The banks have gotten tired of doing bridge loans to keep the oil sector alive. BUT, when they stop the loans, the SHTF.
A Glimpse Of Things To Come: Canadian Oil Company Liquidates Hours After Bank Demands Repayment | Zero Hedge

[Danny B]

The mega-parasite is trying to revive the host

Michael Hudson has an excellent analysis of how regulatory capture allowed the banks to fleece us. (Repost); Michael Hudson on Debt Deflation, the Rentier Economy, and the Coming Financial Cold War | naked capitalism
Charles Hugh Smith shows the outcome in clear detail; oftwominds-Charles Hugh Smith: What Killed the Middle Class?
They stole everything we had and now, want to give us free money.

The ghettoes, indian reservations and the reserves for the abos all have huge problems with alcohol and drugs. The huff gasoline if they can't get good drugs. Deep, down inside, nobody wants to live the worthless, pointless life. They choose slow suicide. Americans are hooked on anti-depressants. And, what is in anti-depressants? https://www.youtube.com/watch?v=ppAVBtP-l5Y
The parasite is successfully killing the host.

[Danny B]

The Dollar Has Been Shanghaied - The Daily Reckoning
This is a maxed-out effort to save the financial system. EFFING marvellous. A currency devaluation, seen from the street level, is just a cut in wages.

The bankers are running the show. They are bending over backwards to offer us more loans. We lost our jobs and spent our savings. We don't want any more debt. We don't want longer credit terms. We cut back our consumption, often involuntarily. Consumption has crashed. The corporatocracy is hard at work on various trade agreements that are designed to smash labor rates and bring back their previous big margins. The plan to use these agreements to kill or circumvent GOV regulations that protect the environment and / or workers. They have big plans to cut their overhead costs by driving down wages.
Somehow, it didn't occur to them that low wages will result in low consumption.
"General Electric CEO Jeffrey Immelt was charged by the president with a Herculean task: figuring out how to get big American firms to start hiring again. First, he says, we need "a sense of national urgency around jobs" and a government that's focused 100 percent on the task at hand."
Immelt, himself was responsible for outsourcing LOTS of jobs.That's what happens when wages leave,,, profits leave too.The record for Dem controlled States and cities is painfully bad.

EDIT;
"Today we have the foundations poured for the next crisis, and that crisis will be emanating from the public sector, as this is where all of the asymmetry has built up." GOV going broke.Was This The Worst Economist Forecast Of All Time | Zero Hedge

[Danny B]

Chinese devaluation,,, CB stupidity

Many years ago, it was claimed that the American economy was "de-coupled" from the Chinese economy. NOBODY claims that now. ALL governments are socialist,,, China, more-so. Since socialism is a consumption system, NOT a productive system, socialism requires central planning. In a true free market, planning is done by producers and consumers. China needed to do a very rapid buildup to avoid being over run by the West.
Since the "goals" of GOV are different than the goals of the average person, this central planning is always an aberration. They are always focused on desires rather that actual market demands.
This always results in malinvestment.

China built up far more production capacity that was needed. They buried the rest of the world with their cheap productivity. BUT, all this stuff was financed. Their export business is down 25%. They can't pay the loans.
"According to documents submitted to the Chinese Parliament, four especially moribund sectors (steel, coal, cement, and nonferrous) officially owe $1.56 trillion, which more than likely cannot be repaid."
More Bad China Debt News: SOE Defaults on $2.3B
You can bet that the true amount is much higher.The Next Crisis Will Be THE Crisis | Zero Hedge

The banks all tried to survive even though the economy was shrinking badly. It bought them some time but, that time is running out; The Big Unwind Hits Investment Banking | Wolf Street

[Danny B]

Still true.This Map Shows If You Live Near An Aging Nuclear Reactor | The Daily Caller
As long as other regions have lower wages, this tends to drive down wages worldwide. This is primarily true in manufacturing but, it also drives down wages in other sectors. The problem comes in that these low-wage competitors have FAR lower costs for housing. Our wages have to come up OR our cost of housing has to come down. The GOV safety net tends to support the price of housing even though we can no longer afford housing with our diminished wages.
Should the safety net fail, many (more) millions will be homeless.
Chinese money is flooding the housing market and driving up house prices in many markets,,, like Vancouver and Orange county. As aggregate Western wages continue to fall, new house construction continues to fall. Zoning laws aren't favorable to tiny houses because taxing authorities want big houses with BIG taxes. Property taxes, in general, are unfavorable to living on the cheap.
As more workers are displaced by cheap labor markets, GOV tries to raise taxes to support them. We will end up with 20 people on the dole living in a single-wide out in the boondocks

[Danny B]

student debt, energy stocks,,, Russian stocks

It's often said; What can't go on forever, WON'T. "Student Debt 2030: 17 Trillion! " Confessions of a College Professor: Student Debt 2030: 17 Trillion!
It's pretty clear that all debt worldwide is inter-connected. China may blow all to hell first,,, who knows?
Then, there is the energy sector. The banks are deeply tied to the energy sector.
"using the S&P Energy Sector Index data, the sector's forward multiple is now an absolutely ridiculous, mindblowing 23x."

This was 14 months ago. Where do we stand now?

The snapshot answer comes courtesy of the latest Factset weekly earnings insight, according to which as of this moment, the forward P/E of the Energy sector is no longer "an absolutely ridiculous and mindblowing 23x".... it is, in fact, more than double that at 58.7x, which also happens to be more than four times higher than the 15 year average.

There is no longer a word to describe the lunacy where the forward P/E multiple was literally "off the chart" until the Y-axis was doubled."
OK, so double the Y axis and everything will be good.

https://www.armstrongeconomics.com/armstrongeconomics101/depression-v-helicopter-money/

[Danny B]

Cannibalism

My great, long post disappeared. Here is the short version. It is VERY important that you understand this article. The Great Ponzi Scheme of the Global Economy - The Unz Review
All the classical economists made a clear distinction between profits that resulted from an increase in productivity and profits that did NOT result from an increase in productivity.
The non-productive sector of the economy now claims that it has twice the value of the productive sector. https://s-media-cache-ak0.pinimg.com...f516ddaedf.jpg
The economy has been hollowed out and trade is collapsing. "Worse Than 2008" World Trade Collapses To 10 Year Lows | Zero Hedge
The financial industry is sitting on enormous piles of debt notes that are claims on future productivity and services. This is "cerebral wealth". They believe that it has value.

[Danny B]

Peak wages, peak consumption and peak debt

Concentration of Wealth Vs Political dysfunction What could be worse than the Great Depression? - Money and Markets - Financial Advice | Financial Investment Newsletter ? Money and Markets - Financial Advice | Financial Investment Newsletter

[Danny B]

Bogus treasury sales, Europe has no future

"One by one, nearly all Treasury buyers have ceased buying (net) US Treasury's.
As each group of buyers ceases their purchases leaving an ever smaller pool of potential buyers, interest rates have fallen further in contradiction to market fundamentals?!?
Since QE3 was fully "tapered" (no further net new Fed purchases), all foreign buying has simultaneously ceased.
The only remaining buyers are the US intra-governmental purchases but primarily the US public (US banks, US pensions, US insurers, US private citizens).
Since the completion of the Fed's taper in November 2014, the US public has undertaken the greatest Treasury buying spree in history "
Jim Willie made it clear, the FED is buying all Treasury issuance.
Hambone's stuff: Treasury Buying Mystery - Does Treasury Data Imply the Treasury Market is a Fraud!?!The End Of Europe As We Know It? | Zero Hedge

As if Europe doesn't have enough domestic problems, they are importing problems; https://www.armstrongeconomics.com/i...pe-is-burning/

[Danny B]

Harry Dent sets the date.

" world's super-bagman" UNAOIL: THE COMPANY THAT BRIBED THE WORLD
Never forget, your e-mails are forever. Something the hildebeest has recently learned.
Harry Dent; "I think the worst will be over by 2020, but the worst of that will be by the end of 2017."
Trend Forecaster's Dire Warning: Massive Crash Will Wipe 12,000 Points Off Dow Jones By Late 2017
More layoffs; " As you will see below, corporate defaults are currently at the highest level that we have seen since 2009."
Corporate Debt Defaults Explode To Catastrophic Levels Not Seen Since The Last Financial Crisis

[Danny B]

Hussman on stocks

"Using basic mathematical relationships which have held for over 100 years of stock market performance, Hussman concludes a run of the mill reversion to the mean will result in a 50% stock market loss. In order to reach a secular low in valuations, we would experience a 73% loss from here. That seems inconceivable to a population of normalcy bias blinded, iGadget distracted, math challenged CNBC believers. Will you let cognitive dissonance rule your decision making or will you use reason to understand the peril directly ahead?"

"Given the current dividend yield on the S&P 500 actually exceeds 2%, the historically run-of-the-mill expectation from current valuations is that the S&P 500 Index itself will be below current levels 12 years from today, in 2028."

[Danny B]

http://blogs-images.forbes.com/mikep...1-1200x502.jpg
Keep in mind that the deficit is growing by about $ 1 trillion a year. The negative net worth of US GOV is growing at about $5 trillion a year. Any fracture in public finance would crash both pensions and medical care.

The Keynesian wet dream is an end to all interest charges,,, "euthanasia of the rentier". It may sound good. It may even work. BUT, getting from here to there involves continued ZIRP to kill off the existing economy. That means wiping out ALL funds including pension funds. Oregon PERS unfunded liability swells to $21 billion | News - Home
Grandpa is going to be very pissed off if he has to give up golf and take up begging.

Imploding Pensions Take The Rest Of US Down With ThemThis is just another twist on the downward spiral.
Davidson, 20 unquestionable charts; $10 Oil Will Trigger Economic Collapse, Warns Economist - The Sovereign Investor

[Danny B]

Can a cashless society survive hackers?

Western society is so open that it has NO way to deal with domestic terrorists.
What about Western banking? "February 5, the first Friday of the month, saw the Federal Reserve Bank, and more precisely its customer, the central bank of Bangladesh, ripped off to the tune of $81 million. No one knows who took it, or where the money ended up" "Of the $1 billion in requests, only $81 million went through by then, with another $20 or so million stopped by Deutsche Bank, which noticed an obvious spelling error in one of the requests, and halted it. The rest of the money went through, hit casino accounts in the Philippines, and just disappeared." Saved by a spelling error?

[Danny B]

hopefully, market forces will kill fission power

Just for a change, I have a tiny bit of good news. There are about 435 commercial nuclear reactors in the world with about 60 in the planning stage. There are many thousands of fuel rods that need to be reprocessed and are a great danger. GOV is NOT good about telling us about the danger; 10 Devastating Radiation Accidents They Never Tell You About - Listverse
Oil is crashing but, this doesn't seem to stop wind and solar. Wind looks to make good strides in the future. Market forces choose wind power | TheHill
There is an increasing awareness of the contamination of soil and farmland from coal ash. China has it especially bad because they don't use good smokestack scrubbers. China is adding so much wind power that they have had to take a break to build more transmission lines.
Natural gas will remain cheap for a long time. Hopefully, NOBODY will build new fusion of fission plants.
True, the Farnsworth Fusor looks great but, I just don't trust GOV.