Economic pressures

[Danny B]

Spain, N.J. ,Merkel,,, Dis-solution of Europe

Armstrong can be "thick" when he wants to be. In this article, he claims that capital flows are holding up the world, NOT Central banks. Who does he think created all the hot money capital flows? Who is buying up all the bonds and some of the stocks? The BOJ admits to owning 70% of ETFs.

https://www.armstrongeconomics.com/world-news/capital-flow/capital-flows-not-central-banks-are-holding-up-us-economy/

The European technocrats created a fascist control structure. The backlash has violently pushed socialists to the forefront. Spain is a perfect example where Sanchez has blown everybody else out of the water. Rajoy is getting his just rewards for attacking Catalunia.

https://www.thespainreport.com/articles/1618-180602002714-political-bruiser-sanchez-stuns-spain

Merkel shoved her stupid programs down the throats of the German people. The backlash there is hopefully going to crush her AND her insane programs.

https://www.armstrongeconomics.com/international-news/politics/is-germany-heading-to-a-policial-crisis-in-2019/

Yanis Varoufakis predicted that the actions of the ECB would precipitate a crisis that would bring right-wing parties to power.
Additionally, ;
"The Communist Manifesto foresaw the predatory and polarised global capitalism of the 21st century. But Marx and Engels also showed us that we have the power to create a better world. By Yanis Varoufakis"

https://www.theguardian.com/news/2018/apr/20/yanis-varoufakis-marx-crisis-communist-manifesto

This is the backlash to the Kalergi Plan.
The Coudenhove-Kalergi plan - The genocide of the Peoples of Europe | Western Spring
The revolt against the destruction of the European tribes is shifting into high gear.

https://www.express.co.uk/news/world/928974/poland-judicial-reform-european-union-jean-claude-juncker-Mateusz-Morawiecki

New Jersey is famous for it's corruption. BUT, corruption costs LOTS of money.

https://www.zerohedge.com/news/2018-06-02/new-jersey-abruptly-freezes-spending-it-nears-financial-disaster

Hot Chinese money



Keep in mind that new ideas are taking hold in record time. Any kind of currency change-over must be done SLOWLY.

Yeah, right. Deutsche bank is going to need a rescue long before Italy goes critical.
When Italy goes critical, the Bundesbank will be a giant crater.


Buy more popcorn.

Taiwan is just a pawn, not even a knight.

I'm shocked, I tell you,,, shocked.
ALL of this will create capital flight.

[Danny B]

An Irishman's Insight On Africa - Important ReadThe Euro Zone construct is a scheme to employ as many paper-pushers as possible. This is a socialist device to employ as many people as possible working for the government. At the same time, the overlay of the all-powerful unelected technocrats is a fascist control structure

https://www.project-syndicate.org/commentary/merkel-responsible-for-italian-political-debacle-by-yanis-varoufakis-2018-05

https://www.globalresearch.ca/america-is-in-a-debt-trap-death-spiral/5642744

[Danny B]

Jim Willie,,, Italian fallout and contagion

Jim Willie has written for quite a while about a global currency reset. He has written that Pox Americana has vigorously resisted that reset. Making a guess about that, I reckon that New York and London bankers have underwritten U.S. debt to keep the Pox Americana war machine operating until it ultimately slaps down "This is a memo that describes how we're going to take out seven countries in five years, starting with Iraq, and then Syria, Lebanon, Libya, Somalia, Sudan and, finishing off, Iran." Wesley Clark
Pox Americana is still a few countries short of the list. The Pentagon reports that it can't account for $21 trillion. It would appear that Pox Americana is kiting checks and the big banking centers are covering for it. Israel expects to eventually go to war with it's neighbors.
That would be; Gaza, Lebanon / Hezbollah and, Iran. It does NOT want to fight a war on 3 fronts. The plan WAS to weaken Iran and Hezbollah.
The opposite has happened. Israel may weaken Gaza but, that only strengthens Hezbollah.
How much longer will the banking centers honor $trillions in U.S. unfunded spending waiting for Lebanon and Iran to be destroyed?

Jim Willie and notes on European banks.
"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.

However, the bigger bond holder for Italian debt is France. Expect a massive bank crisis to emerge very soon that wrecks Societe General and BNP Paribas, its two largest banks.
Back in 2016, the Hat Trick Letter warned of very high Non-Performing Loans among the Italian banks.
Jim is always early and people tend to ignore a warning for a situation that they just can not perceive.
It was this CDSwap rising rate which warned at least three months in advance of the Lehman Brothers failure (killjob by JPM and GSax). But the contagion for the Italian banking failure is the main point. Notice that back two years ago, the French big banks had triple the size of exposure to Italian debt, versus the German banks. The Spanish and US banks will also suffer from the impact.
The inside people know what is going on. You see the results in the cost of CDSwap. A bit later, you see LIBOR get blown out.

"The Global Currency RESET has begun, hardly with fanfare and parades, or even formal public statements by the main players. Many are the events and steps toward the planning and execution of the RESET, which will be very disruptive, and make the Lehman failure seem rather minor by comparison.
The Jackass has been preaching for several years that the QE monetary policy has saved the big banks, or at least through bolstered official liquidity having bought them some time. But the consequence has been to render severe damage to the tangible economies. QE has essentially killed the economies. The feedback loop has struck the banks

"Therefore, the true inflation adjusted GDP has been minus 2% to minus 4% every year since before the Lehman failure.
The entire Belt & Road Initiative forms a massive $6 to $8 trillion conference table of projects, mostly construction, all in the Eastern Hemisphere,
WAIT,,, what about money for wars?
"My suspicion is that Turkey might soon play a role with it, in conversion of sovereign subprime (toxic) bonds like the USTreasurys and EuroBonds. Keep in mind that Italian Govt Bonds deserve a 10% yield, like the Greek Govt Bonds, except that the Euro Central Bank has been subsidizing these toxic (in)securities."
Turkey is going to need to pull a HUGE rabbit out of a hat pretty soon.
"During the Systemic Lehman Event, otherwise called the bust of the Everything Bond Bubble (from QE squared), some sovereign bonds will be defaulted upon, with painful consequences from the failures. During the upcoming bust, certain entire national banking systems will collapse."
Armstrong broadly hints at this but, doesn't want to be accused of starting contagion.

"Bear in mind the gigantic Egyptian gold investor, where something like 50% of his wealth was invested in gold bullion metal. The shrewd investors expect only PM to survive the big burn that comes, and not much else"
The source is not certain how much longer the suppression of price and news can be maintained. It surely will not last another year, more like at most several months. Events are picking up in accelerated speed
NO kidding
Upon further reflection, the Jackass believes a widespread shutdown of principal globalist cabal banks might occur, which would alter the entire global financial framework, and unleash the gold demand.
Two Key Events Will Unleash Gold

Jim, "topics covered include the growing US isolation from failed foreign policy, the defiant disobedient reaction by European Union with respect to Russian sanctions and renewed Iran sanctions"

So, the banking detonator seems to be Italian debt. Here is a good article for understanding that particular problem.

https://www.project-syndicate.org/commentary/italy-sovereign-debt-restructuring-by-carmen-reinhart-2018-05

Once again, you may not care one bit about Italian debt. BUT, it is the contagion that you should care about.

[Danny B]

Flashmob, European capital flight,,, dollar attack

Armstrong, "As the low-interest rates have undermined pensions throughout Europe, the governments will have to step up and bail them out.
The low-interest rate policy for nearly 10 years has not merely destroyed the bond market in Europe, it has undermined the pension system both privately and publicly. Indeed, adding to this crisis is the mandate that all pension funds hold some or the majority of their investments into government debt.
Furthermore, as this pension crisis matures, we will have the same problem of transfer payments. This is how and why the EU will break apart because there is no actual resolution to consolidate the debts.

https://www.armstrongeconomics.com/international-news/europes-current-economy/the-pension-crisis-will-breakup-the-eu/

"Our models based upon reliable source flow data is currently showing that the Eurozone is the NUMBER ONE place in the world with the greatest amount of capital fleeing than any other region worldwide. "
"The internal flight is to the British pound which is starting to shift from even Germany. "

https://www.armstrongeconomics.com/international-news/europes-current-economy/warning-capital-outflows-from-europe-are-the-greatest-in-the-world-economy/

Poland and Hungary are rejecting the immigrant invasion.
"What has become increasingly apparent is the mere fact that confidence among SERIOUS money is starting to realize the EU is a failure."
The Norwegian wealth fund has over US$1 trillion in assets, including 1.3% of global stocks and shares.
What happens when a fund like that starts to move money?
"Centralized control was the downfall of Russia and China under a communist state system."

https://www.armstrongeconomics.com/international-news/europes-current-economy/scandinavia-receiving-capital-inflows-as-well-as-poland-hungary/

Add to that; the Euro is under attack by the dollar hegemon.
"don't blame the Fed's rate hike cycle. Instead blame the "double whammy" of the Fed's shrinking balance sheet coupled with the dollar draining surge in debt issuance by the US Treasury."
Treasury debt can only be bought with dollars. The more debt that is issued, the more dollars go OUT of circulation. Keep in mind that the R.O.W. is trying to break away from the dollar. As America cuts off dollar funding, this crashes all other markets. This is a battle of attrition, nothing less.Yup, the plan is for the dollar to be the last man standing.
"already reputable foreign central bankers are demanding the Fed stop the pain. "
"One can only imagine the chaos and turmoil in EMs (and then DMs) in four months time,"

https://www.zerohedge.com/news/2018-06-04/central-banker-observes-sudden-evaporation-dollar-funding-warns-global-turmoil

The crash is coming and, the East plans to anchor the bond market to gold. Pox Americana is trying to suck up all the capital to try to survive. NOBODY wants the SDR. Armstrong assures us that all sovereign debt will collapse. The Achilles heel is OIL. America will attract a lot of fleeing capital but, it isn't going to the junk bond markets. That market was the only thing that kept fracking oil flowing. Also, it isn't going to the sovereign bond market.
Pox Americana rattles sabers all along Russia's western front. Also, in the South China Sea and North Korea. Putin is showing a LOT of restraint. America has killed quite a few Russian soldiers. Bolton is a blithering idiot, along with being a war hawk. The Wolfowitz doctrine calls for the destruction of Lebanon and Iran. Has he actually given any thought of what would happen if 20% of the oil supply were cut off?
Europe is pulling away from the American war hawks. There is a segment that wants the collapse as soon as possible.

[Danny B]

Headlines

Carmen Reinhart is as smart as they come. Here, she writes about Italian debt.

https://www.project-syndicate.org/commentary/italy-sovereign-debt-restructuring-by-carmen-reinhart-2018-05

Probably true. The skills-gap is getting worse and worse.

Ugly won't be the word for it,,, especially when it takes out the oil industry.

It has always been a crash predictor.

Yep, not a penny to go into R&D nor wage increases, nor CAPEX.


Educators, my a$$. I bet that not one of them is a teacher,,,, administrators, ALL.

There is going to be a lot of NOTHING in the future.

[Danny B]

Italian conflagration,,, headlines

Armstrong; Liquidity has collapsed and, the banks are trying to change the rules to squeeze out a few more bucks.

https://www.armstrongeconomics.com/world-news/central-banks/fed-is-moving-to-allow-proprietary-trading-again/

https://www.armstrongeconomics.com/markets-by-sector/agriculture/winnipeg-grain-exchange-closing-right-in-time-for-the-cycle/

He is getting a bit more strident in his warnings about food.

"There is much hope buzzing around in Europe that Draghi is planning on ending Quantitative Easing. This is giving the Euro a bit of a lift in hopes that higher interest rates will stem to drastic capital outflows from Europe that resemble rats fleeing a sinking ship. "
The ONLY thing that keeps the European bond market for blowing to smithereens is,; the fresh capital injections.

"The new Italian Prime Minister Giuseppe Conte said Wednesday that he wanted to organize the cooperative banking sector differently than the previous governments. His plan will most likely meet with considerable resistance from the financial sector and most likely Brussels. He seems to be toying with the idea that he wants to separate the banks as Glass-Steagall did during the aftermath of the Great Depression. He wants the future investment banks to be separated from retail banks."
Good idea but, too late.

https://www.armstrongeconomics.com/international-news/europes-current-economy/europeans-pray-for-qe-to-end/

Not in your lifetime.
No kidding!!

This is the new "take no prisoners" economic plan.

Every little bit helps.


A bullet in the head would have more direct results. How many millions of lives has she destroyed?


Yep, the bankers have priced most people out of housing.


"Why Are the US's "Enemies" Buying Up All the World's Gold?
Page not found – Casey Research
It's virtually impossible to get physical gold in London - BullionStar
Comex Leverage Now 300 Times Greater Than Available Physical Gold!

[Danny B]

Full on attack at all dollar competitors

Nobody really wants U.S. sovereign debt. A few years ago, the Treasury claimed that; Belgium, Luxembourg, Iceland, Cayman Islands Were buying it. Never mind that Belgium had no dollars to buy Treasury bonds any way. We haven't heard much from the BLICs lately. More recently, Treasury claims that American households are buying Treasury notes. NOT banks or investment funds. This is highly unlikely. The current admin is borrowing about $1.5 billion a day. Reportedly All this borrowing is sucking dollar liquidity out of the economy.
The FED is shrinking it's balance sheet which causes a shrinkage of funds in the upper loop of the economy.

The BOJ does not allow just anybody to create Yen-loans. The FED allows banks, States and all manner of entities to create dollar-denominated debt. Since the dollar had the highest rate of saturation and confidence, everybody created dollar denominated debt.
Since the dollar was the most stable currency, it generated the lowest interest rate and, everybody tied everything to the dollar.

Now, the FED and Treasury are reportedly sucking up all dollar liquidity. They claim that the bid-to-cover ratio is very high. I find that hard to believe if American households are supposedly doing most of the buying. We are CURRENTLY in a liquidity crisis. I suspect that the ESF is doing all the buying from the primary dealers. There is no way to tell.

We are in a liquidity crisis for whatever reason. There is a huge shortage of dollars that is leaving dollar-denominated debt in a very bad position.

Make no mistake. The currency war has gone up a notch,, MAYBE TWO.
We used to have a G-8. Somebody kicked out Russia in an obvious effort to isolate them. Trump is kicking the war on the Euro into high gear.

https://theintercept.com/2018/06/04/trumps-ambassador-berlin-promises-help-far-right-nationalists-take-power/

Raise the dollar by attacking the Euro.
Deutshe bank has about $45 trillion in derivatives. If all counter-parties paid up, they would net out to just $3--4 trillion. Credit-default swaps at Deutsche bank are about the same price as CDS for Italian banks.

https://www.bloomberg.com/news/articles/2018-06-02/deutsche-bank-s-slow-bleed-continues-as-a-pivotal-month-begins

https://www.rt.com/news/429060-italy-nato-russia-sanctions/

https://www.armstrongeconomics.com/world-news/pension-crisis/irish-pension-invested-in-italian-bonds/

I can't leave out France. Societe Generale is the biggest bank in France. Pox Americana is fining them for something that has nothing to do with America.

https://www.courthousenews.com/french-bank-fined-1-billion-for-bribes-in-libya/

The U.N says that migration is both good and normal.

https://www.zerohedge.com/news/2018-06-05/mass-migration-should-be-accepted-western-nations-un-secgen

The EU forced a lot of bad policy on the Europeans figuring that there was nothing that they could do about it. Varoufakis warned them about the rise in populism. The center figured that they could always maintain control. In Italy, the Left joined with the Right because they valued nationalism and survival above ideology.

China is trying to unify the East into an economic bloc to resist the control of Pox Americana. Naturally, Pox Americana is attacking China and the East to stop this union. Keep in mind that; if China defaults, the West can't expect to make collections with the military.
For now, the East has growing debt and currency problems.

https://sputniknews.com/asia/201806081065210589-asia-crisis-dollar-strength-economy/

The FED will crash domestic markets by lifting rates. At the same time, it will attract foreign capital inflows with it's better interest rates. It appears that the FED prefers to crash Europe and the Emerging markets even if it brings down domestic markets. China probably has the liquidity to carry along the East. Russia is doubling their gold production. Between them, the can probably keep commerce going.



Yeah, right,,, WAPO and Bloomberg.

[Danny B]

Austrian deja vu

Here is a graph of the stock market from 1925 to 1955. The financial system allowed TOO MUCH margin debt. You can see the spike at 1929. If you take out that spike, the market was not all that bad.

https://images.duckduckgo.com/iu/?u=http%3A%2F%2Fwww.mcnuttmath.com%2F403b%2Fcontents%2Fextras%2FIntro_to_Investing_files%2Fslide0069_image018.jpg&f=1

It was the excess margin debt that made the market vulnerable to a crash.

The '29 crash did not cause the Great Depression I. It is claimed that the Great Depression I was precipitated by a banking failure,, specifically, Credit Anstalt.
The Creditanstalt Crisis of 1931 and the Failure of the Austro-German Customs Union Project
"European bank runs and failure of Credit-Anstalt in 1931 - Business ...
Page Not Found - Business Insider...
May 21, 2012 - At the time, it was the biggest bank of Austria. Its failure triggered a European banking crisis"
Biggest bank,,, why does that sound familiar?
Lessons from the Credit-Anstalt Collapse - Bloomberg

https://www.bloomberg.com/news/articles/.../lessons-from-the-credit-anstalt-collapse

https://www.armstrongeconomics.com/world-news/austria-it-started-the-collapse-in-great-depression-will-it-do-so-again/

Edit; Here is the current though on gold in Austria;

https://www.zerohedge.com/news/2018-06-08/without-gold-i-would-have-starved-death-ecb-governor

So Austrian and European bondholders have been warned that bail-in is the new program. Is it any wonder that there is huge capital flight to America?
Armstrong said that the stock market is no longer affected by price or earnings.

[Danny B]

credit crisis and illiquidity

Armstrong made it clear that U.S. GOV would collapse going into 2020.
Not wanting to be left out of the doom porn, Ray Dalio says that he expects the whole system to collapse going into 2020. Now, we have a celebrity who is claiming that we will collapse going into 2020.
Big, Bad, Bald Benjamin Shalom Bernanke.
Remember, Bernanke said that HE could have headed off Great Depression One. He said that the FED did not inject enough liquidity to save the day.

Bernanke 2008;
"As you know, financial systems in the United States and in much of the rest of the world are under extraordinary stress, particularly the credit and money markets. ......resulting in further declines in asset prices and a drying up of liquidity in a number of funding markets."
He injected something like $18--20 trillion. It did NOT fix anything, except temporarily.

" it also means that the more supercharged the economy gets thanks to the fiscal stimulus, the greater the fall will be when the hangover hits. "
"Stealing further from the Bridgewater note, Bernanke said that while the stimulus "is going to hit the economy in a big way this year and next year and then in 2020 Wile E. Coyote is going to go off the cliff, and it's going to look down"
"The irony here is delightful: after all it was Ben Bernanke who consistently blamed Congress for not doing enough to jumpstart the economy during his time in office - a core topic of his 2015 memoir "The Courage to Act: A Memoir of a Crisis and Its Aftermath"; it is the same Bernanke who three years later is now blaming the President and Congress for doing too much."
"Congress is largely responsible for the incomplete recovery from the 2008 financial crisis, Ben S. Bernanke,"
"And now that Congress has more than done its part, Bernanke predicts collapse in under 2 years."
"The even bigger irony of course is that the real reason for the upcoming collapse has little to do with Trump whose $1 trillion stimulus is a drop in the bucket compared to the doubling of the US debt under the previous administration and the $20 trillion liquidity injection by Mr. Bernanke"
"But, with a convenient scapegoat currently in the White House, the Fed - and certainly the one person who assured that the bursting of the current asset bubble will be nothing short of spectacular, Ben "subprime is contained" Bernanke, will be more than happy to place all the blame for the upcoming economic crash on who else, Donald Trump."

"When POTUS was on the campaign trail he said the U.S. economy was all a big bubble being propped up by the Fed's low interest rates, and now of course the Fed is saying it's all a big bubble being propped up by the POTUS tax cuts"

Comments;

"The inevitable collapse from attempting unlimited growth on our finite planet is a surprise? Really? The 1972 MIT "limits to growth" detailed this a long time ago.
Limits to Growth: Dennis Meadows (#116 Encore) - Conversation Earth
According to this graph from BofA ML, the Fed is going to create a crisis next year by raising rates.

https://glitchtraders.com/2018/05/24/deutsche-every-fed-tightening-cycle-creates-a-crisis/

Which was done (((Fed Chairman))) By (((Fed Chairman ))) over the last 30 years... Wow...


Now that we are AT the brink i think it is BRILLIANT that you have a token Goy in Place as Fed Chairman... Jerome H. Powell... For The Inevitable Destruction of the US Economic System... as you so well predict Ben ?

https://www.zerohedge.com/comment/11802089

About that liquidity and those credit markets,,,




NOT true, they want to precipitate a crash from dollar illiquidity.

Buy more popcorn.
THAT is what the FED is betting on.

Trump pulled the wheel off the apple cart.


The ECB would like to raise rates to stop capital outflow. They can raise rates but, they can NOT buy confidence. Raise rates,,,,, collapse much sooner.

OK, we're told over and over that liquidity has dried up. Who Knows?
"Total System (non-financial, financial and foreign) Credit expanded at a (record) seasonally-adjusted and annualized rate (SAAR) of $3.513 TN during 2018's first quarter, compared to Q4's SAAR $1.411 TN and Q1 '17's SAAR $860 billion. This booming Credit expansion was fueled by an SAAR $2.519 TN increase of federal borrowings. Granted, this was partially a makeup from Q4's slight contraction in federal debt growth.

In nominal dollars, Total U.S. System Credit expanded a blazing $962 billion during Q1 to a record $69.717 TN (349% of GDP). Non-financial Debt (NFD) expanded a record (nominal) $874 billion, with one-year growth of $2.413 TN. One must return to booming 2007 for a larger ($2.508 TN) four quarter-period of Credit expansion. NFD ended Q1 at a record $49.831 TN, matching a record 250% of GDP. NFD expanded $4.086 TN over the past two years, the strongest expansion since '07/'08."

"Outstanding Treasury Securities ended Q1 at a record $17.046 TN, increasing a nominal $615 billion during the quarter."
"Treasury debt-to-GDP ended Q1 at 85%, more than double 2007's 41%. It's worth adding that total Treasury and Agency Securities ended Q1 at a record $25.920 TN, or 130% of GDP."
" Total Debt Securities (TDS) expanded $789 billion during the quarter to a record $43.868 TN. TDS began 2000 at $15.606 TN and closed 2007 at $28.828 TN. TDS ended Q1 at a near-record 220% of GDP, up from 2007's 200%. "
"Household Liabilities increased $44 billion for the quarter ($538bn y-o-y) to $15.574 TN. "

https://creditbubblebulletin.blogspot.com/2018/06/weekly-commentary-q1-2018-z1-flow-of.html

[Danny B]

Buying time in the confidence battle

Armstrong has an AI program that now runs over 30,000 variables. You can well imagine that I am having a hard time trying to paint a coherent picture. Good thing that I am not writing a subscription newsletter.

A. The feds claim that unemployment is 3.1%
B. Shadowstats shows very clearly that it is about 23%
C. The State admits that 95 million are not in the workforce.
Investors focus on "A" because it sounds the best.

"Total System (non-financial, financial and foreign) Credit expanded at a (record) seasonally-adjusted and annualized rate (SAAR) of $3.513 TN during 2018's first quarter,"
So, credit has expanded by a rate that is a new record. At the same time, we are told that there is an extreme liquidity crisis. Nobody is buying new treasury debt issuance. Uncle Sam reports that (formerly) BRICs were buyers. Now, they claim that American households are the buyers. I suspect that all this new liquidity is being channelled to support the State. The world capital is flowing to US GOV regardless of how many stock certificates you hold.

Investors focus on total Treasury sales and the Bid-to-cover ration and, don't look any deeper. I expect that the big funds are not fooled.

Nobody is shorting Japanese sovereign bonds because the BOJ just prints more and more to support everything.
Nobody shorts U.S. treasuries because they assume that all the foreign capital flight is holding up all markets.
Europe is a different story. It is painfully obvious that nobody is buying sovereign bonds from southern Europe. Europe has become Marxist with a fascist overlay of control.

https://www.goldmoney.com/research/goldmoney-insights/the-gently-rotting-debt-ridden-eu?gmrefcode=dollarc

OK, so the world is in a full-on battle to attract funds to home Central banks. The French State spends 57% of the GDP. Remember that money spent on consumption can not be paid back,,, as opposed to money spent on investment. The more socialist a State is, the harder it is to attract funds and repay debt. What if those State funds are encumbered or endangered?
"Deutsche Bank and Italian banking system failures with all the extreme consequences like the contagion to the French banks which hold three times as much Italian debt exposure versus German banks,,, the systemic Lehman event which has begun with extreme risks for both sovereign bond defaults and entire banking system failures"
GOLDEN JACKASS.COM - The Golden Jackass Knows Gold, Currencies & Bonds"

America has gambled that raising rates will attract enough capital to float all boats. They know that a lot of business will fail from the higher rates but, they believe that the gamble is both necessary and worthwhile.
America is buying time to hold back a sovereign bond collapse. Uncle Sam is pocketing the capital inflows that are supposedly going into the stock market.
At the same time, Uncle Sam is attacking all rivals. Somebody is shorting Deutsch bank, the largest in Europe. Could that somebody be Uncle Sam?

Did Uncle Sam help out Lega Nord and 5Star? That election certainly helped to destroy ECB credibility.
Trump Taps Bannon's Producer For US Propaganda Czar
America is working very hard in the war to attract capital AND trash other CBs. No wonder that the G-6 are mad as hell at him. The Italian banks will blow the minute that Draghi lets off the gas pedal. Deutsche bank will blow the next day

Donald Trump at G7: 'US is not a piggy bank to be robbed'
Ah yes
When America reneged on the Bretton Woods agreement, the dollar became a de facto reserve currency. The only way that the R.O.W. could save money was to buy dollars. We had to print more and more AND still run a trade deficit. Unfortunately, this arrangement resulted in; the R.O.W financing their own destruction by way of the deep state.

America is trying to buy time in the confidence game and, at the same time, destroy the confidence in other States / currencies..

The Central Bankers are trying to preserve their little domain.


China;
"Chinese money not only inflates a property bubble domestically but also around the globe (e.g. in Sydney and Vancouver) The IMF has forecast a further doubling of total Chinese debt outstanding from USD 27,000bn in 2016 to USD 54,000bn in 2022."

https://mises.org/wire/china-trouble

The result,
I really have no idea how this will work out.

[Danny B]

Peak cheap oil, Trump and the FUSOR

America reached peak cheap oil Several years ago. The shale-oil-miracle was all pumped out at a loss. The junk-bond market is melting and, shale needs 1.5 million new wells at a cost of $5.4 trillion. The Wolfowitz doctrine called for Pox Americana to control Central Asia and, all the resources there. The Sino-Soviet bloc is just NOT going to let that happen. Trump and Co. are trying to buy a little more time and, a little more confidence. There is a general agreement that America will collapse going into 2020. This would be at election time for the President.
50% of our oil is used on the road. We're importing about 4 million BPD.
Trump is trying to create raproachment with Russia. Several factions are trying to block that.

Iffy, "According to secret space program whistleblower, Corey Goode, President Donald Trump issued a highly classified Memorandum soon after his January 20th inauguration ordering the release of group of classified patents concerning anti-aging and health, along with free energy technologies."

https://www.exopolitics.org/secret-presidential-memo-anti-aging-free-energy/

". Dr Thomas Valone estimated that patent applications for FREE ENERGY related technology have been "secretized" over 3,000 times over the years."
Patent Office
OK, it is obvious that a crash in oil supplies would bring a crash in EVERYTHING. Will Trump try to pull a rabbit out of a hat? There is a positive indication.
Lockheed Martin Now Has a Patent For Its Potentially World Changing Fusion Reactor - The Drive
Hot fusion was discovered decades ago. It was buried to protect the petroleum industry. Standard Oil had to borrow money from the credit markets to pay dividends. I suspect that the FUSOR will be brought to market to take pressure of oil production.

The West is going in to a complete crash. Cheap fusion would make a huge difference in the outcome. As the price of energy goes up, consumption goes down.
Housing; https://www.theautomaticearth.com/20...re-overvalued/

Kunstler, The Summer of Discontent - Kunstler

[Danny B]

C.H. Smith,,, Buffet,,,bank closure,,,Trump & peace

Some writers are just WAY above all the others. Charles Hugh Smith is one of them. And, what does it cost you to hear his wisdom?
If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via patreon.com.
Moving on, Smith has written an EXCELLENT summary of where we are. It is a great over-view.

https://www.oftwominds.com/blogjun18/whats-wrong6-18.html

A couple of years ago, Venezuela pulled home all it's gold to support it's currency. The currency is failing anyway.
Most recently, Turkey is pulling home it's gold.
Countries Around the World Have Begun Pulling Their Gold from U.S Vaults

https://www.thedailybell.com/all-articles/news-analysis/the-most-successful-investor-in-modern-history-is-selling-heres-what-it-means-for-you/

P/E ratios are astronomical because of all the hot money floating around looking for a safe-haven in something tangible.
Armstrong has said to have a weeks worth of food. Armstrong normally does not talk about specifics like that. Armstrong has been VERY vocal warning about the difference between assets and currency. Buffet has his money in Treasuries.
Put this all together; you can see that Armstrong is avoiding forecasting a bank closure. Why else would he endorse having a simple one-week food supply?
Deutsche bank laid off 10,000 more employees. How long can a bank operate after losing so many people? When the Italian banks and Deutsche bank collapse, all banks will be closed for reorganization. Buy LOTS of popcorn.

The cost of an education has gone up at 3 times the rate of general inflation.
"The number of students enrolled in higher education had dropped by a little over 450,000 after years of booming growth"
Those who actually teach are not getting the money. It ALL goes to the blob state. The millions of paper-shufflers who add nothing to the industry.

https://www.theatlantic.com/education/archive/2018/06/heres-how-higher-education-dies/561995/

Apparently, the global financial safety net is breaking down, https://www.philstockworld.com/2018/...ly-inadequate/

Larry Kudlow, National Economic Council director, hospitalized after suffering heart attack, Trump says
Poor guy took a look at the budget deficit.
Armstrong is not openly predicting a bank collapse. Economic Prism is predicting a collapse of the dollar. I suspect that this will happen after the EMs and Euro collapse.

https://goldsilver.com/blog/the-us-government-will-destroy-the-dollar-because-its-the-only-option-left/

http://kunstler.com/cluster****-nati...ing-diplomacy/

[Danny B]

Fiscal policy & FED policy,,,borrowing $trillions to support non-producers

The Central Bank was created to finance wars when the State didn't have enough gold to finance a protracted war. (G-30 bulletin) Before WW II, the FED was forced to buy GOV bonds to make sure that the war could be long and lucrative. Both Japan and Germany tried in vain to surrender early. Both were rebuffed. After WW II, U.S. GOV demanded that the FED continue to buy GOV bonds. This set the CB on the road to finance State debt.
The State is the firewall between Darwinian pressures and, non-producers. As time goes by, more and more non-producers are drawn to a State paycheck. The bankers are more than willing to make GOV "service" very lucrative to public officials with power. The second tier hangers-on don't get remuneration from the bribe train. They have to settle for a GOV job that pays them far more that the private sector,,,, that is, if they even have any abilities needed in the private sector.

Central Bank monetary policy is slowly subjugated to service an ever-increasing State debt. This isn't just about the welfare State. The warfare State is a huge drain also. The welfare state buys us a bit of domestic tranquillity. The warfare state does just the opposite.

https://www.zerohedge.com/news/2017-07-31/killing-them-killing-us

17. Read, On Killing: The Psychological Cost of Learning to Kill in War and Society, by Lt. Col. Dave Grossman.

We would need a completely different fiscal policy if we wanted FED policy

https://www.armstrongeconomics.com/armstrongeconomics101/economics/the-misconception-of-central-bamks/

"You have to understand that the entire budget and social programs were indexed to the CPI. So, the NUMBER ONE way to reduce deficits was to reduce the CPI index so politicians did not have to vote to cut programs and suffer the arrows launched by the public."
"The biggest cost of labor is NOT the actual wage paid to an employee. It is the benefits, taxes, and regulatory costs." Feeding the blob State

https://www.armstrongeconomics.com/world-news/taxes/the-cost-of-labor-is-what-drives-the-move-to-robots/

Government v the People

https://www.armstrongeconomics.com/armstrongeconomics101/economics/supply-v-demand-side-economic-what-is-never-discussed/

Gavin Newsom will double the state income tax: John Cox - MSN.com
https://www.msn.com/.../gavin-newsom...ax.../vp-AAypl...

Armstrong will invariably take the side of the private bankers. It is NOT that simple.
"The Communist Manifesto foresaw the predatory and polarised global capitalism of the 21st century. But Marx and Engels also showed us that we have the power to create a better world. "

https://www.theguardian.com/news/2018/apr/20/yanis-varoufakis-marx-crisis-communist-manifesto

At the same time,we must consider, "A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship"

This is where we now find ourselves. Too many non-producers trying to live off of renting their money. Too many non-producers in GOV trying ti live off of the taxes of the producers. 50% of the cost of everything that you buy, goes to finance. The banks front-run everything that you buy,,, using your savings that pay no interest to you.
Americans Must Work Jan. 1 Through April 24 Just to Pay Taxes
The debt has doubled under every administration.

Armstrong is correct about the burden of debt caused by the State. He ignores the burden caused by the bankers. That is, price inflation caused by currency inflation.

https://internationalman.com/articles/inflation-your-role-as-a-milk-cow/

The reproductive rate and the demographic crash is where the rubber meets the road.

[Danny B]

Taper, SS,,, notes on Trump

Headlines;
No accident there.
Armstrong claims that Yellen told Draghi NOT to continue with ZIRP. He also claims that Draghi has destroyed the European bond market. Draghi can pull the plug on stimulus but, the Italian banks will look like Vesuvius,,,, on a bad day.
The Germans hold lots of exposure to Italian banks. When Deutsche bank blows, this will crater the Bundesbank.

So, the CBs are going to cut back printing. There is way too much hot money in the system for it to stabilize. Everybody is hunting for yield.


Shadowstats is correct but, nobody wants to listen to them.
The Real Economic Numbers: 21.5 Percent Unemployment, 10 Percent Inflation And Negative Economic Growth
Why stop now?
https://www.youtube.com/watch?v=j2pGBv9Ly6A

Armstrong tried to convince FED GOV to privatize SS and put the money into stocks instead of GOV bonds. The democrats blocked this. ALL the money needed to be available for wars. If it were in stocks, it couldn't be raided to the last penny.

I don't see a future for crypto-currencies. They are used for tax avoidance and money laundering. That pits them against the State. They are constantly hacked and stolen.
The hot money flows into residential RE. The speculators demand higher rent. It is all part of the hunt for yield. ALL of this contributes to a falling birth rate.

It is looking kind of grim. I haven't been there lately.
Last Exit to the Road Less Traveled - New Economic PerspectivesNew Economic Perspectives
Here is an article on the shadow rate at the FED. The article is interesting but, investors must turn a blind eye to the true rate on price inflation. The price inflation rate must be subtracted from the bond yield to get a true picture.

https://dailyreckoning.com/the-shadow-interest-rate-is-flashing-red/

Notes on Trump;
Military-Industrial Stocks Crash After Summit
The globalists gave China most favored nation trading status. Looks like Trump is going to un-friend them.

Lets hope so.

Trump has MUCH bigger plans than any SERIOUSLY devalued Nobel prize.
How to piss off Netanyahooo
He is cutting into their profits. Centrists, my A$$.
Mueller indicted a bunch of Russians in his witchhunt to bring down Trump. He knew that they would NEVER show up to testify.


The Shanghi cooperative Organization includes a LOT of States. They have pledged to avoid war at all costs to settle their differences.
North and South Korea pledge to end war, seek denuclearization ...
https://www.reuters
Trump showed up in N.K. with visions of wealth for Kim's PEOPLE. America says that it is going to get quite rich developing the country. Russia and China have said that they will develop N.K.
NOPE, we can't have peace in Korea until the contracts are signed AND a Rothschild bank installed.
Hot war has just gotten too dangerous. The war-mongers seem happy enough to settle for a cold war. Trump and Putin are conspiring to bring an end to even that. The war hawks are doing (almost) everything that they can to continue a lucrative business.
Much of this centers in Tel Aviv.
The hawks continually provoke Russia by chipping away at it's interests. If Russia finally responds, they can say, SEE, we told you that Russia was a dangerous aggressor. Putin has to absorb damage in the cause of bringing world peace. Obviously, there are several factions that do NOT want world peace.

https://www.zerohedge.com/news/2018-06-12/if-only-wed-listened-ike-inside-deep-state

[Danny B]

https://www.zerohedge.com/comment/11827708

I do not see a single mention that, AS AUTOMATION RISES, THE BIRTH RATE FALLS. People see no particular need to have children to support society. People see no future job niches for their possible offspring. Since a living wage is available to so few, the majority can't afford to have children.

Here is a good article on credit and the cost of renting money. The article goes on and on about the falling FED funds rate. Reportedly, we are 1% away from setting off a credit crisis. Japan PROVES that there is no escape from a credit crash if the population is falling. Does this article make mention of this? Not on you life.

https://www.goldmoney.com/research/goldmoney-insights/living-dangerously?gmrefcode=dollarc

The foundation of the entire economic system is based on growth. More and more wealth must be stolen from the producers to keep the parasites growing numbers well supported. This is completely contrary to the needs of the family and society. Several States are importing millions of immigrants in the hopes of increasing population growth. The fallacy is; most of these people left their home countries because they had no skills or job opportunities there. This has been well proven in that most of the immigrants remain on the dole for the rest of their lives.
Instead of being an economic stimulus, the majority of these immigrants are an economic drain.

Some States turn a blind eye to this. Others do not.

Consumption by the State can never be repaid. Only so much can be siphoned off before it affects the overall fiscal health.

The EU can NOT service it's debt at any rate higher than ZIRP. Draghi knows that he is causing ENORMOUS capital flight. The fallout...


These feces-for-brains never seem to consider globall capital flows. Did it never occur to Draghi that continued ZIRP would wipe out the banks AND the entire EU bond market?

Not entirely true. Due to the saturation of the U.S. dollar AND the lower cost of the U.S. safety net, the FED was able to raise rates and attract capital. I suspect that these capital inflows have been diverted to support the State rather than actually flowing into stock portfolios. Stock indices have gone way up from investors trying to preserve their capital. They don't care about P/E.
All this capital that was attracted had to come from somewhere. The FED took in all the bad loans and made the U.S. banks appear stronger. The ECB did NOT take in the bad loans. Forget that Freddie, Fannie and Sally are bankrupt and bleeding $billions. As long as these black marks do not show up on the balance sheets of the private banks.

China created more new credit than the FED, ECB and BOJ combined. That has led to about $1 trillion a year of capital flight from China. Capital inflows beget confidence and, more capital inflows. Draghi holds rates down and, causes more capital outflows.


Shockingly weak, huh? Their workforce is shrinking by ONE MILLION a year.

No big surprise.
Time will tell the details.