Economic pressures

[Danny B]

Criminals to the left,, to the right... crash dead ahead

Things are definitely speeding up. I need to do a lot of reading to connect things that are inter-related. The Russian campaign in Syria is a major game-changer. After getting biotch-slapped in Syria, the neocons are gunning for China in the South CHINA seas. Why do I see this as an emerging boondoggle?
For the most part, the world is controlled by a global mafia. The bankers seem to be running the show. They want one-world GOV to make control that much easier. MUCH of the world does NOT want to be included in their plans. Evidently, the Khazarian mafia is the top dog.
Greenspan was taken by surprise that bankers would ruin the balance sheets of the banks that they worked for. The bankers aren't the only ones.
"Exactly. Oligarchs and corporate executives continue to strip-mine their companies, with absolutely zero regard to the long-term balance sheet health. Why should they care? " The Deterioration of America?s Corporate Balance Sheet | Liberty Blitzkrieg

The Central bankers bought some time so that GOV could reform the fiscal side of the equation. BUT, as the private sector cut back on debt, GOV madly increased it. "Central Bankers: We Only Bought Time-You are On Your Own" - See more at: Central Bankers: We Only Bought Time-You are On Your Own - The Daily Coin

"Over the last 30 years or so, global debt has risen by around 100% of GDP — so it hasn’t just grown in total terms, but has massively outstripped the economic expansion over that period." https://agenda.weforum.org/2015/10/h...ancial-crisis/
BUT, we have reached a new plateau. "are currently in an unprecedented place where economic textbooks no longer work, and where incremental debt leads to a drop in global growth. Much more than ZIRP, NIRP, QE, or Helicopter money, this is the true singularity, because absent wholesale debt destruction - either through default or hyperinflation - the world is doomed to, first, a recession and then a depression the likes of which have never been seen." The World Hits Its Credit Limit, And The Debt Market Is Starting To Realize That | Zero Hedge
Yep, the marginal-utility-of-debt has gone negative. We will have both default and depression.
The crash is obvious and the search for the perps is on. Who Will Be Blamed? | Zero Hedge

It is hoped that this crash will destroy the Kharazian Mafia also. http://sputniknews.com/politics/2015...nce-power.html
http://www.realjewnews.com/?p=1070

[Danny B]

Desperately trying to get a big war started

Armstrong said that confidence in GOV would crash. Both fear and confidence in American GOV is diminishing.
Headlines; Say No to War: Thousands of Germans Demand Withdrawal of US, UK Troops
Read more: Say No to War: Thousands of Germans Demand Withdrawal of US, UK Troops
"US to bring in new advanced nuclear bombs to Germany – report " https://www.rt.com/news/316186-germa...nukes-upgrade/
The neocons are rabid to bring Europe into a war with Russia. The new Russian weapons make war in Europe a lost cause.
NATO BLIND: Top Secret Russian Air Defence System Deployed in Syria
Hezbollah is getting ready for the ground war in Syria and Russia is going to make sure that there is no interference from israel. Report: Russia Blocked Israeli Overflight of Syria, Lebanon

And what do the neocons have to say about Russia actions in Syria?
"The United States is not interested in meeting with a Russian delegation of military top brass to coordinate actions in Syria until Moscow changes its approach to fighting terrorists in the country, White House Press Secretary Josh Earnest said in a briefing on Wednesday."
"Earnest said. “To be blunt about it, we have said that we are not interested in doing that, as long as Russia is not willing to make a constructive contribution to our counter-ISIL [Islamic State] effort.”
Medvedev Refused Entry to the US to Discuss Syria
Putin is a chess player. He keeps forcing the war mongers to insert their foot into their mouths even further.
Both Iraq and Afghanistan are open to Russian help against (Langley) terrorism. "Afghanistan welcomes potential Russian assistance in war on terrorism" WAIT, what about the poppies?
The entire world is flipping the bird to American war mongers. Why are Germany and Japan still occupied so long after the war? Japan was forced to spend all their earnings to buy U.S. treasury bonds. Their leaders were recently threatened with death if they didn't do as ordered. They are slowly trying to break away. http://www.allgov.com/news/top-stori...18?news=857662
Australia has refused to go on a sabre-rattling expedition to China. Now that the major players have offered some protection, the minor players have taken a stand.

[Danny B]

Lies to the left,, lies to the right. Dilemmas all around

Headline #1: "Most Americans Have Less than $1,000 in Savings"; Headline #2: People Saving Too Much is Now a Problem
Read more at Mish's Global Economic Trend Analysis: Headline #1: "Most Americans Have Less than $1,000 in Savings"; Headline #2: People Saving Too Much is Now a Problem
"Rather, central bank sponsored boom-bust cycles and inflationary policies create so much malinvestment, dissaving, and income inequality that misguided economists mistake money sloshing around for "savings".

The proper way to view savings is production minus consumption. To have savings, one must first produce something. Thus, printing money (borrowing it into existence) does not constitute real savings."
There are $ trillions sloshing around. They are only the proceeds of printing, NOT the proceeds of economic activity.
The FED created ZIRP to save ?????????
ZIRP is killing the banks because investments have no return. ZIRP is killing the pension funds because they have insufficient earnings. They were under-funded all along but, ZIRP made it much worse. ZIRP benefited speculators for a while but, the free money that was required to produce ZIRP resulted in no earnings for the hot money that the speculators tossed around. The Central Bankers made it clear that they had only bought some time. Major changes needed to be made.
"In fact, one study showed that as of last year every State fund was underfunded and the cumulative amount of underfunding was $4.7 trillion. It’s probably safe to assume that corporate/private pensions are underfunded as well by at least that much."
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"The Prisoner’s Dilemma is the most important paradigm for understanding shadow risk in modern financial markets at the pinnacle of a multi-generational debt cycle unparalleled in the history of finance. "
"Global Capitalism is trapped in its own Prisoner’s Dilemma; forty four years after the end of the Bretton Woods System global central banks have manipulated the cost of risk in a competition of devaluation leading to a dangerous build up in debt and leverage, lower risk premiums, income disparity, and greater probability of tail events on both sides of the return distribution. Truth is being suppressed by the tools of money. Market behavior has now fully adapted to the expectation of pre-emptive central bank action to crisis creating a dangerous self-reflexivity and moral hazard. Volatility markets are warped in this new reality routinely exhibiting schizophrenic behavior. The tremendous growth of the short volatility
complex across all assets, combined with self-reflexive investment strategies, are creating a dangerous ‘shadow convexity that will fuel the next hyper-crash. "

[Danny B]

$ 100 trillion cloud of smoke

"We should heed his warning. He is renowned for his astounding accuracy; having pinpointed nearly every major economic crash over the past 30 years… including the 1991 recession, Japan’s lost decade, the 2001 tech crash, the bull market and housing boom of the last decade and, most recently, the impending demise of China and the fracking industry."
“The recession is NOT over yet. $100 trillion of the $225 trillion in loans, bonds and stocks across the world…will simply disappear.”
Critical Warning from Rogue Economist Harry Dent
$ 100 trillion up in smoke. That could certainly be considered deflation.
"When the crisis hit in 2008, the national debt stood at a little under $10 trillion. Now we are over $18 trillion. Government is hopelessly over-leveraged," Washington Sets Stage for Another Financial Crisis
Hey, it costs a lot of money to buy votes.

"Just think about it, we have a government of the United States, a $4-trillion-a-year enterprise"
"As debt limit deadline nears, Lew worries about 'terrible' accident"
As debt limit deadline nears, Lew worries about 'terrible' accident - LA Times
In all honesty, I suppose it is accurate to call a criminal organization an "enterprise".
Armstrong has a different name, Government: The Most Evil Invention in History | Armstrong Economics Government: The Most Evil Invention in History
Stimulate the economy,,, eliminate all taxes. Economists Say Trump is Wrong | Armstrong Economics
But, but, but, who would pay all those GOV employees?

GOV is rarely honest but, they have made an exception. They claim that YOU are the #1 terrorist. http://www.zerohedge.com/news/2015-0...estic-citizens
The State has worked hard to be your new GOD. Problem is, GOD never runs out of money. http://www.zerohedge.com/news/2015-1...s-replaced-god
A large percentage of the top bankers are jews.
Jews have always championed socialism.
The bankers pushed a Marxist president who they could thoroughly control.
They pushed America into disastrous wars to create a "greater israel."
The country is disastrously indebted.
The bankers pushed a president whom they could control. They never considered the fact that an imbecile might crash on the international stage. The unwavering fixation on the protection and enlargement of israel has bankrupted the country and made billions of enemies. A smart, new player has outwitted our court imbecile. The welfare / warfare state (welfare for the rich AND the poor) is on the brink of financial extinction.
The bankers overplayed their hand and now, the world is closing ranks against us. Other than that, things are OK.

[Danny B]

Personal responsibility for personal survival

!964 marked the beginning of the "Nanny state". GOV would take care of everything. Each generation became more dependent.
"It seems 51% of all Generation X adults between the ages of 35 to 54, in the prime earning years of their lives, have ZERO savings, the highest among all age cohorts, with over 20% of them not even having a savings account. This is incomprehensible and reveals an almost juvenile approach to life."
"The malfeasance of the sociopathic privileged class does not discharge the personal responsibility of citizens for living within their means. A lack of discipline, inability to delay gratification, failure to understand basic mathematical concepts, materialistic envy, absence of critical thinking skills, and a delusionary view of the world have left the majority of Americans broke and in debt."
CONFUSION, DELUSIONS & ILLUSIONS « The Burning Platform
Keep in mind that all children are born socialist. An infant has to have everything done for it. An adult must do everything for itself. Children like having everything taken care of and don't want to take on responsibility. It is the parent's responsibility to push the child towards self-support and personal responsibility. We support our children while they make this transition. We can't and shouldn't be there holding them up for their entire lives. We back them up so that they have the confidence to take on challenges but, we don't hold them up.
A family on welfare isn't likely to learn responsibility or take on the burden of supporting itself.
"Not many men can resist the appeal of free money. Americans proved they were no better at it than others.
Falling interest rates and the paper dollar gave them a way to impoverish themselves – by spending money they hadn’t earned.
They took the opportunity offered to them. They borrowed and spent… and drove the entire world forward at a furious pace."
The End of the World Has Already Begun - The Daily Reckoning
What happens to a society that lives for today if something goes wrong? What happens to individuals that make no accommodation for possible future problems in their lives?

[Danny B]

The air is slowly leaking out

Armstrong said that confidence in GOV and GOV debt would crash. "4 Week Treasury Bill Auction Draws Fewest Bidders Since … Jan 2005 (Lowest High Yield Since Feb ’14)"
10/21 UK steel sector imploding, Tata Steel blames cheap Chinese imports – GEAB
10/21 China defaults seen rising after Sinosteel misses payment – Bloomberg
So, the Chinese undercut everybody's price. That drove the competition out of business. But, their low price can't save them when consumption crashes.
10/21 If Caterpillar's data is right, this is a global industrial depression – Zero Hedge...No kidding! They finally caught on.
10/21 Bond market begins to panic – Talk Markets It's about time.
10/21 A third of all containers shipped from Long Beach Port are empty – ETF Daily News Amazing, we're shipping clean air to China.
10/21 Venezuelan President Maduro says $88 oil price needed – BBC Good luck, with globalization, it is the low-cost producer who gets the sales.
October 21, "Oil Glut Appears To Be Getting Worse, Not Better" Oil Glut Appears To Be Getting Worse, Not Better | OilPrice.com
10/21 Saudis risk draining financial assets in 5 years – Bloomberg Times are tough,,, even for a king.

[Danny B]

Socialism payed for by nobody

Irwin Schiff offered $ 50,000 to anyone who could show him the place in the IRS tax code that required us to pay income tax. He also wrote books on the subject. He died in a prison hospital shackled to a bed. Peter Schiff?s Father Dies In Prison, Shackled To A Hospital Bed « The Burning Platform
No company in it's right mind wants employees. They want productivity and profit. Employees are a necessary evil.
GOV, on the other hand, tries to create as many jobs as possible so that everyone is dependent on GOV. 51% of Americans receive a check from GOV. The defence (offence) industry makes stuff to be quickly destroyed,,,, and continuously replaced. Endless legions of lawyers and bureaucrats shuffle papers to each other. They never seem to run out of new rules to enforce. Complying with all these new rules is a new burden on the private sector.
As automation takes over more and more of the private sector, GOV tries to create more and more niches.
This is a Tipping Point: Robots "Cheaper Than Any Human Worker" Means the End of Jobs
Every additional $1 dollar in taxes reduces the productive economy by $3. GOV can print new money to keep things going but, it can't be loaned through the banks. Even then, it is doubtful that employment will rise much. http://www.psmag.com/business-econom...icipation-rate
As we shuffle from an industrial economy to an automated economy we have to provide support for an ever-growing crowd of people who will no longer / never have a job niche.
The demographic crash worsens everything. 10,000 people sign up for SS every day. Automation is doing all the work but, pays no payroll tax.
Industry was happy to drive down wages to a global-mean wage. They are now discovering that people don't have purchasing power to buy the products of industry. Obamacare was an effort by one segment of industry to ensure guaranteed profits. It's crashing. Forbes Welcome
The consumer economy is toast without good wages and discretionary spending.
Corporate America got the tax lowered so that they could (supposedly) create more jobs.
" Of America’s 30 largest corporations, seven (23 percent) paid their CEOs more than they paid in federal income taxes last year.

All seven of these firms were highly profitable, collectively reporting more than $74 billion in U.S. pre-tax profits. However, they received a combined total of $1.9 billion in refunds from the IRS, giving them an effective tax rate of negative 2.5 percent. "
"Corporations are quick to complain that the U.S. tax rate – 35 percent – is the highest among industrialized nations, but they neglect to mention that the average large corporation paid only slightly more than half that rate – just 19.9 percent – between 2008-2012. Corporate taxes as a share of GDP remain near all-time lows, while corporate profits set another record last year."
The corporations are too stupid and short-sighted to see that they are starving the goose that lays the golden eggs.
So, robots don't pay taxes. The poor don't pay taxes. The corporations don't pay taxes. Maybe GOV employees are paying all the taxes.
A credit collapse of the GOV will change that.

[Danny B]

International Trade falling fast

Warren Buffet has been called the "Oracle from Omaha". I'm not all that impressed with his understanding of what is really going on. He has stumbled badly. IBM, Wells Fargo and Wal Mart. "Three stocks, one week, $1.2 billion down the drain."
"(Forbes) – The hedge fund of billionaire David Einhorn continued to plunge in September, falling 3.5%, further denting his returns in 2015. Einhorn’s Greenlight Capital hedge fund is now down by 16.9% for the year"
These guys just don't have an understanding of e-commerce and the crash in discretionary spending.
Global debt-to-GDP http://www.theautomaticearth.com/wp-...btSinceGFC.jpg
"Global trade is also declining at an alarming pace. According to the latest data available in June the year on year change is -8.4%."
Everything's Deflating And Nobody Seems To Notice - The Automatic Earth
Auto loans, http://wolfstreet.com/wp-content/upl...ns-2015-2Q.png
Commercial property index, http://wolfstreet.com/wp-content/upl...et-2015-09.png
“Bank Failures and Systemic Breakdownsâ€�: Regulator Warns on Autos, Subprime, Commercial Real-Estate… | Wolf Street
"Pummelled by Lousy Global Demand and Rampant Overcapacity, China Containerized Freight Index Collapses to Worst Level Ever " That's what happens when you knock out the wages of your best customers.
"The CCFI is now nearly 30% below where it had been in February and 23% below where it had been 17 years ago when it was set at 1,000."

"Europe Admits QE Has Failed, Promises More Of It"
China has excess steel capacity equal to the total steel capacity of Europe and America combined. SHOCK, it's crashing. Just goes to show you that the miracle of central planning isn't such a miracle after all.
Our entire system is based on non-stop growth. Growth is winding down. http://www.beppegrillo.it/en/2015/10...l_revolut.html
Armstrong and his undergrads created the program, Socrates. Socrates receives the RSS feeds and constantly learns. It has all the historical financial information. I suspect that it can make better predictions and investments that a human. How long until it is widely applied?
What happens to speculation when everything is logical and informed?
http://www.armstrongeconomics.com/archives/38502

[Danny B]

overcoming peak debt

GOV made lots of money available for education in America. The cost of an education has risen at 3 times the rate of general inflation. GOV made money available for housing and the cost of a house has gone up enormously even though the cost of actually building the house has not risen very much. In Japan, GOV made money available for housing. Home mortgages are now out to as much as 100 years.
"The Swedish banking system is extremely highly leveraged, in large part due to an overheated housing sector were housing prices have soared beyond what any regular income can afford."
Cashless society, negative interest rates and hyperinflation – part 1
The State / bankers print money and push it into bubbles here and there. They financialize everything and skim off the top. You only have to look at the cost of drugs and medical care to see this effect. They have pushed money into everything except wages and seem to believe that everything will just carry on normally.
American wages are back to where they were 40 years ago. GOV seems to believe that it can just print up the difference between low wages and high costs. This money was offered to us as interest-bearing debt. We didn't take it because we are debt saturated and out of work. We have reached peak debt. Next step is to just give it to us for free. I can't wait to see how that works out.

[Danny B]

Looking for inflation while blindfolded

Congress Approval Rating Drops To Dismal 5 Percent In Poll
The Huffington Post | Mollie Reilly | Posted 10.09.2013
The cure.
To help combat them, the department has created a new counsel that will coordinate the investigation and prosecution of anti-government and hate groups.
Here is a vid from Charley Mcgrath. https://www.youtube.com/watch?v=0Zd2fFjJuRE Here is a comment from the vid; If you are not on the 'list' already, then YOU are not doing enough to speak out - FACT !
Are YOU on a list? Is there actually a law against hating the government?

Armstrong has a pretty good explanation why QE is not inflationary.
"While so many people claimed that Quantitative Easing (QE) would produce inflation since it was the creation of money, the truth is very far from this simplistic idea. The theory used by the central banks is seriously flawed and a throwback to ancient times before 1971. There used to be a difference between debt and cash where you could not use debt as cash to borrow on. Then it was less inflationary to borrow than to print, but that changed post-1971. If you want to trade today, you post T-bills as cash. The REPO market has emerged where AAA securities can be borrowed against for the night.

Therefore, buying in bonds to inject cash into the system under the old way of running the monetary system pre-1971 made sense. Today, it is proving to be a fool’s game. Why? This is merely swapping debt for cash; the REAL money supply has not increased when the true definition of the base in money supply is debt + cash. "

Armstrong seems to overlook some very important details. Senator Inhofe says that the banks didn't pay back the bailouts; https://www.youtube.com/watch?v=9xLGdzLdXUE
There has been a LOT of loose money sloshing around. QE2 went to European banks. It was never a debt swap.
"we are now at the extreme in economic destruction by the state in their hunt for taxes. "
"The central banks have bought in the debt rather than declaring they will support the market. This means that they will not have a market to reverse the position and sell the debt they bought in. This means that a sovereign default wipes out central banks as well. Hence, the long-end of the market is being systematically rendered extinct.

We may see the bonds crash in price to the extent that people are not interested. However, the central banks will have to buy in more and more debt. This raises the risk of “conversione forzosa”, whereby even if you bought 30-day government paper, they simply decree that they will not repay that obligation for 10 years. They can simply convert short-term to long-term. We are more likely to see this type of action before any real reform" Quantitative Easing & the Nightmare It Has Created | Armstrong Economics

America was falling into deflationary crash when the housing bubble burst. We were debt saturated and there was no point in trying to force more debt into the system. The TARP money was debt-free high-power money created by the FED. Only the FED can create money that does not have to be paid back. Not to be confused with the money supply.
https://en.wikipedia.org/wiki/Monetary_base
So, the bond-cash swap might not be inflationary but, the FED is pumping out tons of money at the repo window and other places. The Plunge Protection Team and the Exchange Stabilization Fund are also pumping cash into the economy. Building crappy fighter jets pumps money into the economy. But, the deflationary forces are just too great. Helicopter money is the next remedy. You can't have a consumer economy if the consumer lost his job.
The FED stuffed about $ 2.5 trillion into the banks as excess reserves and pays .25% interest to the banks. More free money. Various pundits claim that we will have hyperinflation when this money moves into the general economy. Banks do NOT lend out reserves. The money isn't moving into the general economy because nobody wants it. That is why price inflation is muted. Wages are going nowhere so we can't have a wage-price spiral.

So, the central banks will get wiped out.
This article claims that the dollar will be purposely crashed to make way for the SDR. Globalist Agenda Watch 2015: Updates 78-81 – The debt ceiling, the new abortion videos, and Presidential politics (+ a P.S. – The Vatican is behind the new video release) | RedefiningGod.com
Interesting speculation.

[Danny B]

wages and consumption moving up in china

If you search .... China Crash.... , you get 128,000,000 results. China has been at the brink of crash for decades. I found an EXCELLENT comment at an article that puts much of this in perspective.

Your weekend video viewing has arrived!

If you have been reading the western media, they talk of doom and gloom in China. However, that is a figment of their imagination and shows their lack of understanding of what is going on in China.

China is shifting from being an export driven economy to a consumption driven economy. In the last 7 years, China has moved it's economy from 39% being in service/consumption sector to close to 50% in the service/consumption sector. Hence, their exports and manufacturing have to slow down. But that is not the end of the world if the people are employed, earning more and are creating world class giant companies.

Today, just over 100 million people are categorised as 'Middle Class' in China who are now the largest middle class group in the world, having beaten USA this year.

According to McKinsey Consulting: As China’s consuming class has grown (it now numbers more than 100 million households and is expected to reach more than 200 million by 2025),

There are a shocking 160 cities in China with a population above 1 million.

Guess how many cities in America have population above 1 million: 10

There are 21 cities or urban areas with a population above 5 million in China!

Meanwhile, in America there is only 1 city or urban area with a population above 5 million which is NYC! Just one!

You must watch this series of video documentaries created by Singapore based channel News Asia:

Watching these mind blowing documentary series and seeing the scale of work and amount of money being spent will put tremendous confidence in your thinking about the future demand and coming solid growth in China. This will allow stocks to rise, currency to grow, economy to strengthen and eventually beat the US economy in all aspects over the next few years.

Part 1 The New Silk Road - Toggle

Some statistics in this fascinating documentary:

Inland China is now growing faster than port cities due to congestion, over population etc in the port cities. In the first 6 months of 2015, Chongqing a new city at the heart of the New Silk Road Project grew 10.7% GDP in just 6 months!

Chongqing is 3 times larger than Shanghai! 33 million people live here which is double that of Beijing!

129 out of Top 500 Fortune 500 companies are already present in Chongqing over the last 7-10 years.

USD 112 billion will be spent on 300 new projects on the New Silk Road aside from creating a BRICS bank (USD 50bn), Asian Infrastructure Investment Bank (USD 100bn)and USD 40 billion spending on Silk Road Fund

1 out of every 3 computers in the world are built in China.

1 new Free zone in Chongqing being built in China at 1,200 sq kms is DOUBLE the size of ENTIRE SINGAPORE!

Govt helps in land acquisition, subsidies, infra, construction etc.

2.63 million cars were built in Chongqing last year which is half of all cars built in Germany!

In one large car company, in order to retain employees, they have hired chefs from FIVE STAR HOTELS!

From 6 weeks down to 2 weeks is now the time required to reach Europe from China for goods.

China has spent a shocking USD 6.75 TRILLION to shift 400 million farmers to urban centres and provides them training and jobs.

Beijing to Spain will be covered on this New Silk Road railway project. It will also include the world's largest railway project.

Millions of jobs will be created in entertainment, mines, education, hotels, refineries etc.

Huge tax benefits and subsidies are being provided for many new factories being created in variety of sectors in the new inland cities.

London will be connected to China by rail! Parts of the network are already running.

If all goes well, USA could be linked via Russia and Alaska and Canada to China by rail sometime in the future and travel time will be only 32 hours!

Part 2: The New Silk Road - Toggle

Since 2012, the inland Chinese city Lanzhou was transformed from a desert land to entire city with hundreds of buildings and roads and railway network for the New Silk Road, once the Govt decided to spend billions.

Chinese oil rig companies also invest heavily in Iran by supplying rigs and oil pipes. In addition, oil pipelines are to be constructed from Iran to China via Pakistan.

Part 3 The New Silk Road - Toggle

China-Kazakhstan deals in 2015 thus far have been USD 23.6 billion already being invested by Chian into Kazakhstan.

This is 10% of annual GDP of Kazakhstan.

Kazakhstan railways itself has spent over USD 60 billion on creating a new railway network associated with the New Silk Road.

2.

We also have a research report from Ernst and Young describing in detail what this new project is all about:

Riding the Silk Road:

China sees outbound investment boom

Outlook for China’s outward foreign direct investment

March 2015

http://www.ey.com/Publication/vwLUAssets/ey-china-outbound-investment-report-en/$FILE/ey-china-outbound-investment-report-en.pdf

3.

According to Goldman Sachs:

CHINA IS TRANSFORMING THE GLOBAL ECONOMY



THE RISE OF CHINA'S NEW CONSUMER CLASS

Goldman Sachs | Our Thinking - The Rise of China's New Consumer Class

Goldman Sachs | The Rise of China's New Consumer Class

CHINA IS TRANSFORMING THE GLOBAL ECONOMY

CHINA: AN ECONOMY IN TRANSITION

SEP 2015

Goldman Sachs | The Rise of China's New Consumer Class

Breakdown of the consumption led growth in China is as follows:

1.4 million individuals have income above USD 500,000

146 million individuals have income above USD 11,733 pa

236 million individuals have income above USD 5,858

387 million individuals have income above USD 2,000

These numbers are staggering when compared to any other country on the planet.

China’s middle class has overtaken the US’s to become the world’s largest

http://qz.com/523626/chinas-middle-c...orlds-largest/

4.

According to McKinsey Consulting, the future of the world will be based on innovation and low cost base in China:

THE CHINA EFFECT ON GLOBAL INNOVATION - McKinsey

In the next ten years the “China effect” on innovation will be felt around the world as more companies

use China as a location for low-cost and rapid innovation. The overall China effect could be disruptive,

bringing large-scale yet nimble innovation to serve unmet needs in emerging markets and produce

new varieties of goods and services for advanced economies. Around the world consumers could

benefit from better goods at lower prices.

So don't be afraid of investing in China because the new stocks being listed or new bonds being issued will remain stable and rise for years to come....

[Danny B]

article links.. growth in China

I couldn’t get the pdf link to enter right; http://www.ey.com/Publication/vwLUAssets/ey-china-outbound-investment-report-en/$FILE/ey-china-outbound-investment-report-en.pdf
The article was, IMF Seen Approving Yuan As "Reserve Currency" | Zero Hedge
Another relevant article; Chinese TV Series Lauds Israel: The Alliance Between China and Zionism | Foreign Policy Journal
The West is in deep trouble. Instead of saving for capital formation, we just printed fresh money. Canada BLEW past America when it comes to debt.
https://www.sprottmoney.com/media/ma...8de0409e55.png
It must have something to do with the cold weather. Denmark is tops in debt. World-Beating Debt Burden Is No ‘Serious Threat’ to Denmark - Bloomberg Business

The East is rising. The West is sinking.
Global Wealth Continues to Shift, 25% of the Western World is Broke | Zero Hedge
China does have internal problems but, at least, wages are rising,,, unlike the West. " But for all the economic advancements, social unrest in China is still a very real part of the national landscape. A 2012 report by the European Union-funded Europe China Research and Advice Network (ECRAN) noted that so-called "mass incidents" in China -- public protests, demonstrations, group disruptions or riots -- rose from 8,700 in 1993 to somewhere between 180,00 and 230,000 by 2010.

ECRAN also quoted official statistics showing that in 2011, China's government spent more on internal security ($111 billion) than on national defense ($106 billion)."
http://www.cbsnews.com/news/as-china...opular-unrest/
We'll see of the China "formula" survives the credit crash.
Edit i had to find a graph. It has often been repeated that income inequality is a sure road to revolution. Here is a graph that shows the stark difference between China and America.
http://i8.photobucket.com/albums/a28/DannnyB/loot.png

[Danny B]

NIRP, poverty and global wage arbitrage

Keynesian socialists have always lamented the fact that some people earn a living off the rental of their money. The current attempt from these people is to just print money as needed. They have forced Zero Interest Rate. Not happy with they have reached Negative Interest Rate. NIRP brings it's own set of problems.
The Financial Times argues that "In a negative carry world – or a flat yield environment - there is no role or purpose for banks because banks are forced into economically destructive practices in order to stay profitable.”
Negative rates as a precursor to death of banking, redux, Gareth Jones
So, just print money and make everybody rich and happy.
In Denmark, home prices have gone up 60% in 3 years. Copenhagen home prices rising at 12% per year (or more) and yet the Danish central bank is operating on the assumption that headline inflation is half of 1%?

In retrospect, is it any wonder that when using such clearly ridiculous "data" on which to base decisions that have taken us beyond the zero-bound and into the Twilight Zone of monetary policy, that the world is now living inside the biggest asset bubble ever inflated..."
Danish household debt is 320% of income. What could go wrong?
NIRP, to fulfil some socialist agenda is just as bad as passing out free money to support crony capitalism. Free money has caused price inflation in housing, medical care, education, stocks, etc. BUT, Danish housing isn't affordable with a normal income.
There is NO POSSIBLE way to create wage inflation when a couple billion people are willing do your job for way less money. ZIRP and NIRP cause price inflation wherever they touch down. This just causes a drop in consumption because price inflation, seen from the street level, is just a wage cut. These are such simple AND proven concepts that they should be obvious to everybody.
This Is What Happens After Three Years Of Negative Interest Rates | Zero Hedge
Look at Venezuela. The socialists pumped in money so that nobody would be poor. Now, they have about 40% price inflation. You can't cure income inequality when wages are frozen.

[Danny B]

Hari-Kari with a Russian hand grenade

Several years ago, Langley? produced hundreds of $ billions of bonds to attack the Russian financial system. I haven't made a connection but, the Russian bond market did collapse. This brought down long Term Capital Management. the investor bankers got together and ponied up the money to save it from default and systemic failure. Bear Stearns refused to contribute and was later dismembered. LTCM could have brought down the whole system.
Currently, the Russian financial system is being attacked again. Once again, this risks global contagion. The zionist Wolfowitz doctrine demands that America MUST control central Asia if it is to continue to dominate the world. The neocons seem to be willing to do ANYTHING to reach their goal. They have pushed Russia into a corner financially, NOT militarily.
They have created a situation equivalent to making a hand-grenade with no time delay.
Collapse Of The Western Financial System Looms As A "Strategic" Russian Default Is Possible | Zero Hedge

Ron Paul believes that our central bank is on it's last legs anyway. "The Fed's Days Are Numbered" Ron Paul On The Crucial Issue "They" Don't Want To Talk About | Zero Hedge
U.S.GOV has been forcing the FED to print to maintain the welfare-warfare State. This can't have a happy ending. The boneheads in D.C. are crashing the system on the domestic front at the same time they are asking the Sino-Soviets to crash it on the international front.

The crash in the energy markets brings enormous deflation to the hedges and derivatives. The counter-parties can't pay up. Soon, even the CBs won't be able to print fast enough.
http://www.zerohedge.com/news/2015-1...t-panic-button

[Danny B]

Headlines

Washington is debating almost everything. http://thehill.com/blogs/congress-bl...t-from-debates
Illinois is starting to melt down. Illinois Budget Mess Spurs Biggest Pension Fund Withdrawal Ever - Bloomberg Business
Debating the budget is like discussing the probable length of the burning fuse on the bomb strapped to your back.
The presidential candidates are going to parade past the movers and shakers to see who can promise the most fealty and get the most money. First-Ever U.S. Presidential Candidates' Forum Held Abroad in Jerusalem, Israel, November 2-4, 2015 | Natasha Srdoc
B of A expects China's bond market to blow to smithereens by next summer. We Now Have An ETA When The Biggest Bond Bubble In The World Will Burst | Zero Hedge
The Central Banks are devaluing their currencies,,,, and wondering where deflation is coming from. Currency Devaluation's Dangerous Role in Deflation | Elliott Wave International

Inflation is slowing in Canada. Maybe it's because the debt to GDP ratio is almost double America at 180% http://www.bloomberg.com/news/articl...ine-19-on-year could they possibly be debt saturated?

The population of Japan is crashing. GOV is trying to come up with solutions. GOV has no shortage of ideas. "He has suggested a “handsome tax”: “If we impose a handsome tax on men who look good to correct the injustice only slightly, then it will become easier for ugly men to find love, and the number of people getting married will increase.”
http://www.zerohedge.com/news/2015-1...rys-birth-rate
So, being born ugly and / or stupid is an injustice? Using the socialist approach, everybody needs to be equally poor, stupid and ugly. You never know what the State will come up with next. http://www.huffingtonpost.co.uk/2013...n_3152761.html
The fall in commodity prices is starting to crash the heartland. 'The Agriculture Department forecasts that farm income, adjusted for inflation, will fall 54 percent from where it was two years ago"
http://www.nytimes.com/2015/10/25/bu...=business&_r=2