Economic pressures

[Danny B]

Trump, the big spender,,, or not

Really nothing much to report.
Trump plans to have a BIG stimulus. McConnell says that it isn't going to happen. After increasing the debt $ 3.6 trillion in ONE year for the Kenyan clown, all of a sudden, the House gets a bout of fiscal sanity.
Trumpxuberance? Until It?s Not - KUNSTLER

The Narrative Changes: Republicans "Pour Cold Water" On Trump's Massive Stimulus, Will Block Tax Cuts | Zero Hedge

"There is about $100 trillion of debt in the US carried by governments and private sector borrowers."
Yellen seems determined to raise rates at the next meeting of the FOMC. That would smoke several sectors of the economy.
The financial sector is slowly coming to the realization that nobody can pay back the existing paper. Default rates just keep climbing. "They" are coming to the slow realization that debt-money can never pay back the debts.
Global aggregate wages just keep sinking to where few people earn more than a subsistence wage.
U.S. debt is growing faster than exponentially. The banks create "money" faster and faster to service the debts that the working people can not service. The debt can be expected to compound until something blows.
At this late stage, even helicopter money can NOT save the system.

The banks can't actually run out of money. After the South American crash, the banks were insolvent. The FED told them to just pretend until they had recouped their losses. It worked.
This is a different story. Asset holders can run out of money if they get too big of a margin call. Pension funds, hedge funds and insurance funds can run out of money if they get too many demands for redemptions.
This just happened to the Dallas pension fund.
So, the banks can play "extend and pretend" for a long time because they don't actually give out cash.
That doesn’t work for pension funds.

[Danny B]

New Jersey going down in flames.... Canada

Still real quiet. Not much to report.
America has paid interest for the use of the money that the FED prints. A few years ago, the FEDs changed the law pertaining to interest payments to the FED. We pay interest for the money and then,,, the FED sends the interest money back to the government.
It's a different story in Canada.
"1974/75 to 2010/11 Canadians paid one trillion, one hundred million dollars interest on debt none of which was necessary! It continues."
Canada’s federal debt | qualicuminstitute.ca

" Also, in 1974 the Basel Committee was established by the central bank Governors of the group of ten countries of the member central banks of the Bank for International Settlements (BIS) ccc4mr.wordpress.com/bis/ which included Canada. A key objective of the Committee was and is to maintain “monetary and financial stability.” To achieve that goal, the Committee discouraged borrowing from a nation’s own central bank interest-free and encouraged borrowing from private creditors, all in the name of “maintaining the stability of the currency.”
https://ccc4mr.wordpress.com/2015/02...ng-after-1974/

Their idea of stability is a fast rise in quantity and a fall in value. http://www.energeticforum.com/redire...%2Ffedebt1.png

In 2012, a 12 year old girl made the rounds talking about what a screw-job the Canadian Central Banks is doing.
https://www.youtube.com/watch?v=Bx5Sc3vWefE
Everybody thought that she was great. Did they follow through and change the law? Nope.

The State of New Jersey spends $ 1,102,463 to maintain one mile of 2-lane highway for one year.
The State of Arkansas spends $ 36,212 to maintain one mile of 2-lane highway for one year.
Between Mob rule and feather-bedding in GOV jobs, the State is going broke. They recently had to shut down all State construction projects.
They need money, "Pension Ponzi Squared: New Jersey Wants To Sell Debt To Its Own Insolvent Funds"
Pension Ponzi Squared: New Jersey Wants To Sell Debt To Its Own Insolvent Funds | Zero Hedge

Robert Muggah has come up with a set of criteria for determining which cities are like to become very dangerous. 25 Cities On The Brink Of Disaster: "Don't Be Here When Things Get Violent, Unsafe, & Fragile" | Zero Hedge

12/14 Fed raises rates, boosts outlook for borrowing costs in 2017 – Bloomberg
12/09 David Murray warns of disastrous property crash – New Daily
Yep, they go together like peanut butter and jelly.
12/14 US producer prices up more than expected – CNBC
12/14 US retail sales rise less than expected – CNBC Like bread and butter.
12/14 2017 will be the year of inflation – Zero Hedge The pundits are cheering the rise in the price of oil, etc. What they seem to forget is; as the price of stuff goes up, less will be sold. With static wages and price inflation, we get stagflation. After 8+ years of trying to get high currency&price inflation to inflate away the pain of repaying the debt, it is a complete failure.
The monetary inflation in the upper loop slowly bleeds over into the lower loop and raises prices. We cut back to just essentials.

They inflate prices and interest rates,,,, we cut back purchasing.
12/14 Economists on verge of cheering – Mish Our debt is rising faster than exponentially. The cheering will come to an end eventually.

[Ruphus]

If you can sell your house or your extra used car right now and make a decent profit, you should go ahead and sell NOW. As interest rates creep up there will be deflation in asset pricing. I bought my fisrt house when mortgage rates were 6.25%. I "stole" it at $89000. Now rates are 3.35-4% and I can sell it for $183000. Since wages have not increased by 100% in the last 15 years, the masses used low borrowing rates as a means to better their lives. Now as rates rise again by 100% or more, no one will be able to afford the monthly payments on $183000. My gains will be eaten away unless I sell now, or I keep it and sell it for $89000 once the rates normalize at 6.5%.


https://youtu.be/esAr0qGu2S4

[Danny B]

Capital flight and the unwinding of the debt super-cycle

The "feed-me" index; Are You "Living In a Death Spiral"? These 6 States Will Collapse During the Next Recession
Three days ago; 12/12 Why 2017 could be do-or-die for China’s bond-fueled builders – Bloomberg Things are coming fast and furious. GOV is always 5 steps behind the curve.

A $ 900 billion outflow from China has to go somewhere.
Fed Fallout Escalates: China Bond Market Crashes Most On Record, Yuan Plunges | Zero Hedge

Globalism sounded great to the finance industry. It could shift capital to any sector that appeared to offer a good return.
I was on a glass-bottom boat off of the Yucatan peninsula when we started to sink. A 57 ft. Striker cruiser was sent out to pick us up. When somebody spotted some whales off to the starboard side, everybody ran over to look at them. The skipper couldn't control the boat with tons of people on just one side.

The same thing is happening with the U.S. dollar. Everybody is rushing into the perceived safety of the dollar. As the dollar rises, more people perceive it to be safe.
Draghi prints more Euros,,,, the dollar goes up (less down).
There is also a hidden factor here. Investment will naturally flow to the GOV/jurisdiction that has the strongest property laws. Communist States don't have a good record of property rights. Socialist States always seem to need more taxes. Money is flowing out of Venezuela because Maduro has started grabbing private property.
China is increasing "social spending" at 15% a year. Capital flight last year is reckoned at $ 900 billion. Capital just doesn't stick around in a given State if the people in that State have low wages.

Capital is necessary to support productive industry. The function of Money is to facilitate trade. These basic ideas have been subverted in the name of unlimited profit. The exorbitant money creation from the CBs flowed into mal-investment all in the name of saving a bloated banking system. This rotted carcass that is about to explode is called a "debt super-cycle".

[Danny B]

General BS... unemployment BS

One can sure get lost trying to keep up on economic news.
12/16 Rising rents lift U.S. inflation; labor market tightens – Reuters
12/16 Eurozone economy appears robust – New York Times
So, labor markets are tightening? Youth unemployment in Europe is as high as 50% in some countries. Most of the headlines and articles are old news or new lies.
What about the economic gurus? Jim Rickards;
"With unemployment at post-recession lows and initial claims for unemployment benefits at all-time lows, Yellen’s analysis is that inflationary pressures from increasing wage demands are just a matter of time."
"the Fed is desperate to raise rates as much as possible. This should allow it to have some dry powder available for rate cuts in the next recession."
The FED needs to raise rates so that they can lower them for the next recession. Rickards wouldn't imagine reporting that the 2008 recession never ended.
Talk about lies and denial !!

Even Martin Armstrong goes along with the BS from the BLS that unemployment is about 4%. BUT, the BLS isn't all BS.
" A record 94,708,000 Americans were not in the labor force in May -- 664,000 more than in April -- and the labor force participation rate dropped two-tenths of a point to 62.6 percent, near its 38-year low, the Labor Department's Bureau of Labor Statistics reported on Friday.

When President Obama took office in January 2009, 80,529,000 Americans were not participating in the labor force; since then, 14,179,000 Americans have left the workforce "
"By almost every economic measure, America is better off than when I came here at the beginning of my presidency," President Obama told the people of Elkhart, Indiana three days ago. "We cut unemployment in half, years before a lot of economists thought we would."
Record 94,708,000 Americans Not in Labor Force; Participation Rate Drops in May
The BS runs deep, smelly and wide. This is true for most reported aspects of the economy.

"The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994."
Alternate Unemployment Charts
GOV knows exactly what the unemployment rate is. They just adjusted their methodology with rose-colored glasses.
Everything that I look at on the financial pages today, is irrelevant or false or old news.

[Danny B]

Italian banks,, cycles,,, loaning money to non-producers

12/16 Italy prepared to pump 15 billion euros into ailing banks: sources – Reuters
"The country’s banks are sitting on €360 billion worth of bad loans. "
https://www.nestmann.com/if-europe-g...07c10025be2cd5
The crooked bankers made huge liar loans to irresponsible people. They should have taken loses. These bad loans were converted to PUBLIC debts and piled on the backs of taxpayers. Over 90% of the bailout money sent to Greece is just handed to the banks. The ECB prints tons of new money to keep the party going. They buy bank bonds with it.
The European Union is like a person with his leg cut off who is receiving a transfusion at the same time.

The ECB is desperate to hold off a bail-in that would kill ALL confidence.
Major Economic Warning Sign: The Euro Is Heading For Parity With The U.S. Dollar

This is an excellent article on Collateral, trust and property rights https://capitalistexploits.at/2016/1...ateral-damage/
An excellent article on cycles; https://matasii.com/cycles-the-end-o...t-super-cycle/
Africa can't collect any collateral because their birth rate is too high

12/17 Draghi said to warn EU rising global rates pose crisis risk – Bloomberg When did he figure that out?
12/16 Opinion: Europe is failing, and Merkel can’t save it – MarketWatch Merkel can be credited with CAUSING it. Her insistence that there could be no debt forgiveness for Greek banks is what started the ball rolling.
12/17 Housing starts dive 18.7 percent: mortgage rates soar – Mish Yellen says 2 more rate hikes in 2017
12/17 Euro-zone inflation stuck in negative territory in November – Daily FX Yep, the money is all stuck in the upper loop.
Credit-money moves from the upper loop to the lower loop when producers take out loans. When speculators take out loans, the "money" just sloshes around in the system. Finance is there to facilitate production & consumption. If it just facilitates more finance, it gets eaten up by price inflation and defaults.
Finance is so desperate to push credit that it pushes credit to non-producers. They can't pay it back. In the case of GOV, it prints new money to pay off old debts. GOV lies about the number of unemployed because it doesn't want finance to be aware of how few actual producers there are in the economy.

[Danny B]

Irresponsible lending,,, now, what do we do?

"The Dow is titillating the entire world by verging for days within a hair of 20,000 without actually getting there. Hitting the Big One would be another reflection of what Trump had called during the campaign an “artificial stock market” in a “very false economy,” created by the Fed that had kept rates low “for political reasons.” The crowds ate it up." Trump Talked, the Fed Listened: Let’s Shrink the Balance Sheet, Bullard Says | Wolf Street
Unlike bonds, stocks depend on actual consumption.
12/19 January 2017 earnings is going to be a bloodbath – Zero Hedge

12/19 Global debt, equity markets lose $1 trillion in value – Zero Hedge
ONE WEEK; "Global bonds lost over $430 billion in market value this week (Yellen hawkishness and China bond carnage) but stocks lost even more ($525 billion)" Global Debt, Equity Markets Lose $1 Trillion In Value As Hawkish Fed Spooks Traders | Zero Hedge

Total Credit Market Debt (TCMD)
"Our collective predicament is simply this: Nothing can grow forever.

Sooner or later, everything must cease growing, or it will exhaust its environs and thereby destroy itself. The Fed is busy doing everything in its considerable power to get credit (that is, debt) growing again so that we can get back to what it considers to be "normal."

But the problem is – or the predicament, I should more accurately say – is that the recent past was not normal. You've probably all seen this next chart. It shows total debt in the U.S. as a percent of GDP:"
"Somewhere right around 1980, things really changed, and debt began climbing far faster than GDP. And that, right there, is the long and the short of why any attempt to continue the behavior that got us to this point is certain to fail.

It is simply not possible to grow your debts faster than your income forever. However, that's been the practice since 1980,"
" Because every major power center, be that in D.C. or on Wall Street, tuned their thinking, systems, and sense of entitlement during that period. "
EXCELLENT ARTICLE; https://www.peakprosperity.com/blog/...ney-under-fire

Here is an interesting but, Flawed article from Steve Keen. Debt Nation: The Problem, the Solutions
“Public debt is not nearly as volatile as the private debt. As long as you can squeeze the public, you don’t go bankrupt. The United States has never defaulted on its debt. If you have the taxation ability, the debt can be a problem if it’s squeezing the budget, but it won’t spark a crisis,”
The main flaw to this thinking is; the more you tax the producing economy to support the parasitic State, the more the producing economy shrinks. There is no unlimited "free lunch" for the parasites.

"However, this system only works if there is a limit on the amount of debt that banks and other financial actors can push into the system, as under a gold standard. If not, the incentive is for lenders to lend ever more, hoping to get bailed out if a crisis hits. Lend without limit,,, what could go wrong?

“Once the creditor class took over and prevented the debt-jubilees from happening, debt got out of control,” said Keen."
"“Deflation can increase the level of private debt to GDP, because GDP falls faster than private debt. Paying down the debt, withdrawing money from circulation and reducing its velocity, reduces GDP more than the decline in the debt,” said Keen.
We can see the same effect from "austerity". As you impose austerity, debt levels rise.

“Every debt collapse in history has had a combination of debt forgiveness and inflation. That is how debt problems are dealt with historically,” said Oliver."
The bankers and the State are working on inflation with little success.
"their money printing ended up in the hands of financial actors, who bought a lot of stocks, rather than real people, who would repay debt and buy goods and services."

The State would print up debt money and send it to everybody. "Private sector debt would decline through direct paybacks and inflation. After households and firms have found their desired level of debt, the re-leveraging process can begin again, and the economy can grow again."
This wouldn't address the main causes of the debt bubble.

The fracture of the nuclear family means that retirees must depend on their savings and pension. 37% of families have no retirement savings at all.
100 CEOs Have as Much Retirement Savings as 116 Million Americans | Common Dreams | Breaking News & Views for the Progressive Community

[Danny B]

China can't have it both ways.

The only current financial news of any import is from China. China has cheapened the Yuan to hold on to market share of exports. This comes with a price as the Chinese try to get out of the falling currency.
"China is eager to mask the true extent of reserve outflows, perhaps in an attempt to not precipitate the feedback loop of even further panicked selling of Yuan and even more outflows, and thus, even more reserve depletion. "
China's True FX Outflows Since August 2015 Are $1.1 Trillion, Double The Official Number | Zero Hedge

12/19 Chinese rush to open US dollar forex accounts – Mish
12/19 Gone in 60 seconds: Chinese snap up dollars as yuan tanks – Bloomberg
12/16 China’s spiralling property prices – BBC Because the State is cheapening the Yuan, the Chinese put their money into property. They have about 80 million empty units of all types. 64 million housing units.
12/19 China to strictly limit property speculation in 2017: Xinhua – Reuters The Chinese State does NOT sell state bonds to be used as a store of value. Excess capital flows into property to the point that the average worker can NOT afford to buy.
The more that the Chinese State tries to limit capital outflows; the more out-of-reach housing becomes. Didn't somebody think of this beforehand? China is also trying to limit purchase of gold because that also causes capital outflows.
12/19 Chinese interbank lending freezes – Reuters

China is trying to keep cash inside it's borders; The Real Reason China Is ?Dumping? U.S. Treasuries

Several central banks are trying to do away with cash so that there is no escape from their pillaging.
Whistleblower Andrew Maguire Just Exposed The Sinister Reason For The Surgical Attack In The Gold Market As Shocking Amount Of Gold Flows Into China & India | King World News
"Central planners are moving to remove cash from the global banking system to give them direct control over people’s lives. The suggestion that cash is for criminals is being floated in stages by the bought and paid for mainstream propaganda machine. The plan to step up capital controls after Clinton was to be elected was already well underway. On the 2nd of October, the ABC News Network in Australia headlined an article titled ‘Cash is for Criminals, why we should scrap big notes.’"

12/19 Bank Of England quietly removing £50 notes from circulation – Liar Politicians Great Britain joins the growing number of States like India that are trying to ream everybody. https://www.youtube.com/watch?v=5ms19Vgxilg

What's true in China is also true in America. LOTS of hot money has flowed into real estate because it is perceived as a store-of-value.
http://ei.marketwatch.com//Multimedi...f-001cc448aede
More and more people are being priced out of home ownership.
http://www.marketwatch.com/story/her...ars-2016-12-17

[Danny B]

Oil, value vs margin.... peak wages

Here is a graph of central bank paper assets; https://srsroccoreport.com/wp-conten...lnas-Price.png
"As a reminder, the peak and decline of global Central Bank reserves took place right at the exact same time the price of U.S. oil fell below $100. Again, this is no coincidence."
"I am completely surprised by the lack of wisdom in the Mainstream and Alternative media analyst community. While many Mainstream analysts are probably paid to put out positive financial or economic propaganda, a good portion of the alternative media has no clue about the key factor that is driving the world straight over the cliff."

"Thus, 99% of global investors park their funds into assets that are propped up by the Fed and Central Banks:"
"As I stated in my article, The Peak & Decline Of International Reserves Warns Of Massive Asset Deflation Ahead, the global economy has already hit the wall and is now imploding."
"In that article, I posted this chart showing the falling U.S. oil price that coincided with the decline of International Reserves:"
It's a very interesting chart; https://srsroccoreport.com/wp-conten...e-Aug-2014.png

Expensive oil has less profit potential than cheap oil. His thesis is that; Much of the financial system is built around the value of oil. As the price of oil rises, it's actual value falls because the profit potential falls.
https://srsroccoreport.com/the-implo...nt-be-stopped/

"This chart from the World Bank site, shows that Global GDP fell from $78.4 trillion in 2014 to $73.9 trillion in 2015. This is a much different figure than the 3.1% Global GDP growth figure reported by the IMF:"
GDP is a very fuzzy measurement of an economy. Just the same, we are sliding towards a global-mean wage and consumption for non-essentials is falling
12/20 GM, fiat Chrysler idle 7 plants; over 10,000 workers affected – Zero Hedge
12/20 GM inventories highest in 8 years, multiple plant shutdowns coming – Mish
It's a funny inverse relation ship that is partly dictated by our wages; http://www.nytimes.com/2016/10/29/bu...ound.html?_r=0
Exxon has lost a LOT of money. With Tillerson coming into power, you can bet that economic sanctions on Russia will come to an abrupt end.
https://www.bloomberg.com/news/artic...nce-depression

The cheerleaders are out in force;

Dow 20,000 And Beyond – Mark DeCambre
3-Reasons The Trump Rally Will Continue – Stephen Gandel
Reasons Why Stocks Are In “Melt-Up” Mode – Adam Shell
Rising Rates Good For Stocks – Lee Jackson
Rising Yields Signal Economic Growth – Peter Ireland
Rising Yields A Bullish Signal – James Picerno
https://realinvestmentadvice.com/dow-20000-12-9-16/
Gravity will win in the end.

12/20 Japan to issue Y1.8 tril of bonds to make up for tax shortfall – Japan Today What a GREAT idea!
12/20 Bank of Japan leaves policy unchanged, upgrades economic outlook – Zero Hedge An UPGRADE,,, why not?
Here is a transcript of an interview with Jim Willie; https://www.sprottmoney.com/Blog/ask...mber-2016.html

The financial sector crushed our wages and sucked out all the money. BUT, it is debt money that they are holding. This financial bubble is full of fart gas and nobody wants to pop it.

[Danny B]

failing hyper-inflation...India crashing

A corporation has no brain, heart, conscience, nor soul. It takes the shortest, logical path to riches; Pharma Execs Arrested in Conspiracy to Create Opioid Addicts for Profit : Waking Times

The State ALWAYS tries to hyper-inflate away it's debts. The CB prints with wild abandon to cheapen the currency. The CBs printed in unison so that investment would NOT flee to a strong currency. The CBs printed in unison to both cheapen their currency AND hold on to export advantage.
The CBs are now discovering that they can't inflate away the debt if everybody is doing the same.
Longboard Funds: The Path Of Least Resistance

This should have been obvious ahead of time to the monetary wonks. Here is the conundrum. Zimbabwe and Venezuela are hyper-inflating their currencies by PRINTING money in big bills. Other States that are trying to go to a cashless society are getting rid of big bills.
ZIM showed the way for achieving hyper-inflation. It is also a question of the egg-and-the-chicken.

BUT, India has severe deflation from withdrawing their big bills. This is part 5 of a series of articles on India by an Indian. "Demonetization Has Achieved Nothing" - India's Rapidly Plunging Toward A Police State | Zero Hedge
The articles go into great detail about the problems caused by removing the bills.
Is India The Next Venezuela? | Zero Hedge
I suspect that the PTB have decided that India is due for a population reduction. It was standard operating procedure under British rule.
Then and Now: British Imperial Policy Means Famine

[Danny B]

Italy in lfames, Spain smoldering, Border tax adjustment

We're having round-robin crashes with various States taking turns. Italy is at bat now. The American S&L crash was brought about mostly be crooked bankers making loans to their crooked friends. About 1,000 bankers went to jail.
The Italians did the same thing.
"Italy’s banks currently have one of the highest problem loan ratios in Europe at 16.4 per cent of total loans, more than three times the European average of 5.4 per cent

"FT writes that the Italian govt set to take a stake between 50% and 70% in Monte dei Paschi, up from the current 4% stake, as part of the government's third bailout in as many years."
"the government agreed to let taxpayers shoulder the burden of yet another bailout of the insolvent bank. In addition to Monte Paschi, other banks expected to benefit from Italy's imminent state aid include Veneto Banca, Popolare Vicenza, Cassa di Cesena, Cassa di Rimini and Cassa di San Miniato."

"There is another problem: in the past both Merkel and Schauble, not to mention Djisselbloem, have made it expressly clear that a bail-in mechanism should be used to preserve insolvent banks, and a state-funded and taxpayer backed bailout/nationalization is no longer permitted."
So, will it be bail-out OR bail-in?

12/21 Italy lawmakers approve 20 billion euro plan to prop up banks – Reuters
12/21 Italy aims €20 billion “bazooka” at €360 billion problem – Mish
12/21 Brace yourself for Italy’s bankruptcy – Zero Hedge

The Italian problem has spread to Spain; European Banking Bloodbath Spreads To Spain After Italy Fires ?20 Billion "Bazooka" At ?360 Billion Problem | Zero Hedge
12/21 From Glass-Steagall to the Fed dominating the UST market in 11 years – ValueWalk Nobody else wanted them.

The strong dollar is creating a LOT of problems. The Trump team has some interesting plans to counter that.
"A “border tax adjustment” would, roughly speaking, be equivalent to a 15% one-off devaluation of the dollar. Imports would be 20% more expensive"
This is a VERY interesting plan.
"a border tax adjustment would be equivalent to an across the board import tariff of 20% and an export subsidy of 12%. Keeping all else constant and applying standard trade elasticity impact parameters to an average of the two estimates results in a more than 2% drop in the trade deficit equivalent to more than 400bn USD, or equivalently, an almost complete closing of the US trade deficit."

"Deutsche Bank concludes that combined with potential changes to the treatment of unrepatriated earnings, "the proposed changes to the US corporate tax code could be one of the most important shifts in US tax and international trade policy in a generation."
Why Trump's "Border Tax Proposal" Is The "Most Important Thing Nobody Is Talking About" | Zero Hedge

If you have LOTS of time here is a comprehensive read on Money and Power. http://www.rense.com/general96/Money&Power.pdf

[Danny B]

U.S. economic confidence.. bring on the muppets...China again... Italy again

The border tax adjustment would probably run counter to the World Trade Organization. I’m sure Trump and company have plans for dealing with that.

Confidence in America is WAY up. U.S. Economic Confidence Surges To The Highest Level That Gallup Has Ever Recorded
Sadly, this is going to be short-lived. Here is an article that lays out ALL the fundamentals. https://www.theburningplatform.com/2...s-way-comes-2/
" Wall Street, their media mouthpieces, and establishment hacks have a job to do – and that is to lure millions of useful idiots into the market just before they pull the rug out. "
"No matter how you cut it, stocks are currently valued to deliver nominal returns of 0% (negative real returns) over the next twelve years, with the high likelihood of a 30% to 50% crash in the foreseeable future. That isn’t an opinion. It is based upon historically accurate valuation methods that have been used for decades."
The muppets aren't going to read about this and they will lose everything.
"The Fed finally raised rates by .25% last week, about three years too late. The bond market is now leading Yellen. She’s a follower at this point."

It could be worse. Chinese investors are lined up for a real screw job.
"In September, the Bank for International Settlements released new statistics on countries' credit-to-GDP ratios, its preferred indicator for impending debt crises. Any score over 10 suggests a country is at greater risk of suffering a debt crisis in the next three years; China scored 30.1."
Playing Whack-A-Mole In Hell: China Battles To Avoid A Meltdown - iShares China Large-Cap ETF (NYSEARCA:FXI) | Seeking Alpha

" • Monte dei Paschi is Italy’s most troubled bank…

About 35% of its loans are non-performing. It has about five times as many bad loans as the average European bank.

This morning, the bank warned that it could run out of cash within four months. "
That's what happens when you make too many "goodfella" loans. It's not just the banking system. The Italian GOV is in deep do-do also. http://www.caseyresearch.com/article...-is-inevitable

Here is a good article on the cost-benefit ration of big infrastructure projects. It essentially shows that infrastructure projects can not be made with debt-money. They add to the debt load without adding more to productivity than their cost .
https://thewire.in/88239/china-economic-mirace-debt/

CALPERS voted to continue to assume that it will receive 7% return on it's investments. http://www.zerohedge.com/news/2016-1...-discount-rate
"stocks are currently valued to deliver nominal returns of 0% (negative real returns) over the next twelve years, with the high likelihood of a 30% to 50% crash in the foreseeable future."
The alternative is to reduce benefits and/or demand more tax money from Sacramento.

[Danny B]

The upsetting of the chessboard

In 1985, Martin Armstrong and his program predicted that there would be a HUGE change in the confidence model 30 years in the future on 2015.75 On that very day, Russia proved that it can stand up against American military. Here is what else he has to say, "This, unfortunately, is setting the stage for the breakup of the United States going into 2036."
https://www.armstrongeconomics.com/i...shire-college/

"Globo-monster Zbigniew Brzezinski's worst nightmare has come to pass. From his 1998 book, The Grand Chessboard:

"To put it in a terminology that hearkens back to the more brutal age of ancient empires, the three grand imperatives of imperial geostrategy are to prevent collusion and maintain security dependence among the vassals, to keep tributaries pliant and protected, and to keep the barbarians from coming together." (p.40)

"The most immediate task is to make certain that no state or combination of states gains the capacity to expel the United States from Eurasia or even to diminish significantly its decisive arbitration role." (p.98)"

"that's exactly what just happened with regard to the 3-Party Syrian negotiation in Moscow" "The new alignment and the absence of the US / EU complex at the table virtually guarantees that Syrian President Bashar al-Assad will not meet the same fate as Saddam Hussein of Iraq and Muammar Qaddafi of Libya. Assad will continue to rule Syria in spite of Obongo’s declaration more than five years ago that he "has to go."

"The commie-Globalists aren't the only ones upset about the new Russia-Turkey-Iran Axis. Though one faction of the Israel Firsters appear to support the neutering of the United States (because there won't be anymore pressure for a "2-state solution"
"the article quotes Andrew J. Tabler , a fellow at the Israel Firster Washington Institute for Near East Policy who studies Syria:

“When the Turks, the Iranians and the Russians all agree on a process without the U.S. being in the room, you realize there is a problem for us.”
"Mr. Trump has not articulated a comprehensive Syria policy, but he has suggested he will work alongside Russia to fight extremists including the Islamic State."
Russia flew 71,000 air missions in Syria. Israel attacked Damascus. Which extremists does Putin have in Mind? Israel is rabid to get the oil in Syria's Golan Heights. It just isn't going to happen.
The strong hand and brilliant diplomacy of Putin, combined with unmistakable peace signals sent forth by Orange Man, have brought the terrorist war in Syria to a close and pulled the world back from the precipice of World War III"
"Boobus Americanus 1: I read in the New York Times today that Russia teamed up with Iran and Turkey to totally cut America out of the Syrian peace process. "

Surprisingly, Britain is more impoverished than Poland, https://sputniknews.com/europe/20161...rty-exclusion/
12/22 25-year-olds’ home ownership in England, Wales halved in 20 years – Guardian
12/22 Durable goods orders dive 4.6% despite huge jump in defense orders – Mish
12/22 US capital goods orders rise, GDP revised upward – Yahoo! Yahoo,, ever the BSer.
12/22 Americans now in more debt than before the financial crisis – MarketWatch

12/22 EU to boost border checks on cash, gold to tackle ‘terrorism financing’ – Reuters They already bring in the terrorists and put them on the dole. There is an easy to stop terrorism financing.

[Danny B]

Trump vs the FED

Obummer et al worked hard to hyper inflate the dollar and make it easy to pay off the debt. He and his cronies are all equally stupid. You can't hyper inflate a currency just by pumping money into the upper loop. The idiots were clear years ago about the attempted hyper-inflation; https://www.youtube.com/watch?v=ILKolTI1s50
Everything that he did was a failure except for the things that he did to drag America down.

The FED was given great independence by custom, NOT by law. It has no legal protection but, must rely on control over the politicians. The FED has now gone to war against Trump. The whole crash is to be thrown into the lap of Trump and company. This is VERY dangerous. There is NOTHING to stop Trump from just closing their doors and letting the treasury take over.
Lest you think that he hasn't the balls to do it, here is a quote from him. "Trump tells the Central Intelligence Agency it's not indispensable"
Does that sound like somebody who is afraid of the FED?
Federal Reserve Initiates End Game As Trump Heads To White House | Zero Hedge

Obummer has refused to block the security council resolution condemning israel for actions in palestine. The israelis have demanded that Trump block the resolution.
12/23 Israel ‘asked Donald Trump to intervene to avert U.N. vote on settlements’ – Telegraph
He doesn't seem to be in any hurry to do so. We shall see. Trump has promised to stop all the regime changes. Who has benefited?
PressTV-Israel sole beneficiary of Mideast wars: Iran

Now, Tel Aviv is starting new rumblings; Jerusalem Post: There will be a war, a big war - Fort Russ
Pox Americana has been left out of the Syria talks. Israel will have no influence.
Italy is going to screw as many people as possible to try to save their banks; Italy set for protests after government coughs up bank bailout costing each family £700 | World | News | Daily Express
12/23 Central banks have cut interest rates 690 times since Lehman Brothers – CNBC Austerity never worked. Now, they cut all bond earnings and everyone's interest income,,,, and, wonder why it didn't fix the economy.
12/23 USDCAD: prepare for a 65-cent Canadian dollar – Lombardi Letter Think "mismanagement" with a capital "M"
12/23 World trade falls to 2014 level, just in time for a “trade war” – Wolf Street Better stock up on junk from WalMart.

[Danny B]

Solution for Italian Banking problems

Canada, "which included Canada. A key objective of the Committee was and is to maintain “monetary and financial stability.” To achieve that goal, the Committee discouraged borrowing from a nation’s own central bank interest-free and encouraged borrowing from private creditors, all in the name of “maintaining the stability of the currency.”
It's been all downhill since then. Borrowing interest-free from the central bank was too good of an idea and had to be blocked.

The crash in the Euorzone was planned long ago to force a banking union and a debt union. Italy is the 10 largest economy but, the third largest bond market. The whole financial system is coming apart in Italy, possibly by design. The Italians made too many "goodfella" loans and now, non-performing-loans make up 36% of the bank's portfolio. The banks are crashing. New ECB rules forbid taxpayer funded bailouts. The rules call for a bail-in.

"The EU's banking union, which came into force in January 2016, prescribes that when a bank runs into trouble, existing stakeholders -- namely, shareholders, junior creditors and, sometimes, even senior creditors and depositors with deposits in excess of the guaranteed amount of 100,000 -- are required to take a loss before public funds can be used . . . .

[The problem is that] the subordinated bonds that would take a hit are not simply owned by well-off families and other banks: as much as half of the 60 billion of subordinated bonds are estimated to be owned by around 600,000 small savers, who in many cases were fraudulently mis-sold these bonds by the banks as being risk-free (as good as deposits basically)."

Ellen Brown has a very good article showing that the Central Bank of Italy could buy the NPLs at essentially no cost. She also shows 3 previous examples where this worked very well. She also proves that this wouldn’t be inflationary. BUT, the finance industry likes all the free money and does NOT want the CB cutting into their business.
Article: The Italian Banking Crisis: No Free Lunch -- Or Is There? | OpEdNews

It is an excellent article and I can find no fault with her reasoning.
" All of which helps to explain why banks and their representatives at the IMF and the ECB are frantically demanding a no-expenses-spared taxpayer-funded rescue of Italy's banking system.

It could also explain why Goldman Sachs took it upon itself to propose a way out of this dilemma: instead of buying Italian government bonds in their quantitative easing program, the ECB and the central bank of Italy could buy the insolvent banks' nonperforming loans.

As observed in a July 2016 article in The Financial Times titled "Goldman: Italy's Bank Saga -- Not Such a Big Deal," Italy's NPLs then stood at 210bn, and the ECB was buying 120bn per year of outstanding Italian government bonds as part of its quantitative easing (QE) scheme. The author quoted Goldman's Francesco Garzarelli, who said, "by the time QE is over -- not sooner than end 2017, on our baseline scenario -- around a fifth of Italy's public debt will be sitting on the Bank of Italy's balance sheet." Bringing the entire net stock of bad loans onto the government's balance sheet, he said, would be equivalent to just nine months' worth of Italian government bond purchases by the ECB."

This would shuffle the QE money to buying NPLs instead of bonds. A very good solution.

Tons of people took out variable rate loans from Spanish banks. The banks failed to disclose that the rates would only vary UP,,, never down. The courts have decided against the banks and the banks want off the hook because they would lose money. We'll see.
Nightmare Before Christmas for Spanish Banks – InvestmentWatch

(Sberbank) As of 2014 it was the largest bank in Russia and Eastern Europe, and the third largest in Europe, As of 2015 the bank had about 16,500 offices with over 250,000 employees.[24] According to own estimates, the bank had over 137 million retail clients and over 1.1 million corporate clients in its 22 countries of presence. Wiki.
Italy could very well take a hint from Sberbank. Their loans are approved by AI.