Economic pressures

[Danny B]

The entire speculative "community" is working against you

There is a limit to the amount of leverage that bankers can create on the money that they hold. If they could use unlimited leverage, it would all soon blow up. They leverage the capital that they hold.Yes, and look what happened to the stock market in the same period.Understanding How Oil Is Traded

So, the banks took your money and, speculated against you. ALL the commodities speculators are buying on margin and inflating the prices. Congress has helped them out greatly.

If you have any doubt that the economy is run by a pack of thieving 8astards, here is further corroboration.

"Federal Reserve officials have been talking about operating regimes for years, and the discussion continues as the central bank struggles to reach its 2 percent inflation target, which it has missed for most of the past five years. Core consumer-price gains came in at 1.8 percent in February from a year earlier"
consumer-price gains so, we are GAINING when prices go up.

https://www.bloomberg.com/news/articles/2018-03-13/inflation-misses-across-the-world-fuel-debate-at-central-banks

Home prices soar high as Federal Reserve hopes to avoid big crash | TheHill

"Central banks now own almost half of global GDP? Is this a market economy, or something else:" The article is about the current tech boom / crash. You can count on it.
Technically Speaking: Chart Of The Year? | RIAIs The Dot.Com Bubble Back? | RIA

More and more States are getting nervous about NOT having their gold within their borders. https://news.goldcore.com/ie/gold-bl...-repatriation/

Post crisis, my arse

That certainly comes out of left field.



Maybe so but, the NSA got hacked.
While the battle it out, Mother Nature and the pole flip will make the decision.

[Danny B]

The banks don't actually produce anything so, how to make a profit? The banks produce free liquidity and invest in commodities, etc. The investors get almost free money and invest in everything. Since they invest with a small sum, (the rest is credit with the brokerage), they can leverage-up their profits. The wage worker who sells his labor can NOT leverage up anything. All he can do is to ""leverage"" his earnings by using credit for purchases. So, while the investor gets a positive return, the interest burden on the credit used by the worker is a negative "return".

Natural progression means that the rich get richer and the worker gets poorer.
THE BANKERS FRONT-RUN EVERYTHING. Everything that you buy, they bought it first,,, then, they resell it to you.
The creation of the welfare-warfare State guaranteed that America would break down the Bretton Woods agreement. A few years later, Nixon was in the drivers seat when it all blew up. He should have re-priced what was left of our gold but, nobody really knew what outcome to expect.
Breaking the chains of gold allowed the bankers to do unlimited money creation.
Since they were first in line to get the money, they drove up the price of everything. There was a common old quote, "if the price of food keeps going up, you won't be able to get a bag of groceries for 5 dollars"
The FED targets 2% price inflation. This really adds up over time.
Currently, they created enormous currency inflation trying to get the desired price inflation.

Many decades ago, England didn't allow people to get married unless they had a place to live. This cut down on reproduction in the poorer classes. Many men were killed in the incessant wars. Many men spent their lives at sea or, in the colonies. Population control in the colonies like India was accomplished by holding rotating famines.
Then and Now: British Imperial Policy Means Famine
Things have now gone the other way, and population growth is too low to support the ruling class.

What happens to the investor class when the working class can't afford what the rich want to sell? The working class runs up a huge credit bubble and then, defaults. The sub-prime crash was a case of; hot money from the upper loop bled over into the lower loop. The banks financed all those flipper.
That S.O.B. Greenspan said that we had to get rid of Glass-Steagal so that American banks could compete with European banks. BS. The NYC banks wanted to have an advantage over the London bankers. The financial class was just TOO BIG. There wasn't enough profit to go around by skimming the middle class. Once the banks got hold of your money, they were more able to front-run every purchase that you made. Profitability came back. They kicked inflation into high gear and bought up everything. BUT, the middle class was wiped out by low-wage competitors. The upper loop grew ENORMOUS. It could no longer be sustained by skimming the lower loop. It needed CONSTANT infusions of CB money to replace the missing profits.

Congress enabled the bankers to outsource your job and "borrow" your savings. The FED enabled the bankers to avoid paying $400 billion a year in interest income to savers. All of this thievery kept the system going for a while longer.
It remains to be seen just how much of the speculator class will be left when the dust settle.

Youtube headings;
Canada gets honorable mention;
Canadians Have the MOST DEBT In the World! Why Middle Class Canada Will Face MASS BANKRUPTCY!
Canada: A Nation Crashing with NO SURVIVORS
BTW, Trudeau say that Canadians are demanding MORE immigration.
EU Revolt: Poland Says 12 Nations Ready to Stand Against Brussels!!
There is no federal debt in the EU. Each nation holds it's own debt. You can bet that there will be capital flight and Brussels will blow up.
Paul Craig Roberts TOTAL COLLAPSE IS NEAR
James Howard Kunstler: The Coming Economy Of "Less"
The Next Great Depression Is Going To Be A Collapse Of Bonds And Governments Martin Armstrong
March 24, 2018 ! Charles Hugh Smith Has The Date Been Set For The Great Economic Collapse !

OK, keep in mind that these are middle-of-the-road people who are fairly rational. Her are a few vids from X22 report, Money Master, Jim Rickards

March 24, 2018 Collapse Date. The Great Crash Is Coming! Prepare For The Financial Crisis 2018
Jim Rickards 'Listen Up! The Financial Elite Will Soon Prevent You Accessing Your money
March 24, 2018 Collapse Date. The Great Crash Is Coming! Prepare For The Collapse.
March 24, 2018 ! Has The Date Been Set For The Great Economic Collapse ! Jim Willie
Alert!! The Fed is Pulling The Plug On The Entire Market, They're Bringing Down The economy
LYNETTE ZANG Financial Collapse Coming %100 in March 24, 2018
This Is Not A Drill! The Economic Crisis Will Start This March 24, 2018 & Last For 5 years
The People Are Going To Be Shocked, 30%-50% Fall In Net Worth Dead Ahead - Episode 1474a X22Report
The Next Crisis Will Come Soon & Will Be BIG - Mike Maloney @Anarchapulco 2018

OK, you get the idea. China will start a new oil futures market and everybody is worried about that date. I'm not worried about that date. There are MANY States that MUST sell their oil to keep their people fed. Currently, Treasury bond sales are well covered. As long as they accept our bonds, the oil will flow. Armstrong is adamant about a collapse of U.S. sovereign debt. I don't see it happening just yet.

[Danny B]

Armstrong,,, corporate debt

Armstrong said that politicians are the WORST people at making economic decisions.
"Extremely reliable sources from Behind the Curtain in Europe are becoming deeply concerned that Draghi at the ECB has created a monumental economic disaster he is just praying to holding off until he leaves next year."
Draghi came straight from Goldman Sachs.
26 Goldman Sachs Alumni Who Run the World (GS) | Investopedia
https://www.investopedia.com/news/26...-run-world-gs/ Both the politicians and the bankers are EVIL,,, just different flavors.

https://www.armstrongeconomics.com/markets-by-sector/interest-rates/interbank-rates-starting-to-rise-monetary-crisis-is-beginning/

Armstrong on the disappearance of metal coins. Looks good for gold and silver.

https://www.armstrongeconomics.com/markets-by-sector/precious-metals/repetitive-patterns-in-the-money-supply-will-coins-become-extinct/

Armstrong also writes that the State will NEVER avoid a crisis, https://www.armstrongeconomics.com/f...e-have-panics/

The Economist Magazine is the mouthpiece of the financial PTB. They are now warning that corporate debt is far too high and, dangerous,

https://www.zerohedge.com/news/2018-03-13/economist-warns-reckoning-looms-americas-debt-binged-companies

THIS is from the article, "The total debt of American non-financial corporations as a percentage of GDP has reached a record high of 73.3%".
THIS is from comments;
"One can only pay debt back out of earnings after taxes. Not GDP.
Corporate debt stands at 6.1 Trillion Dollars. Corporate profits after taxes are 1.644.Trillion Dollars
That's a factor of 3.71 dollars of debt for every dollar of profit after taxes that is available to pay back that debt.
And that makes the ratio of corporate debt to profits after taxes much much more dire than the ratio of corporate debt to GDP makes it sound.
As rates rise, profits decline, and the picture gets exponentially worse."

https://fred.stlouisfed.org/series/NCBDBIQ027S

http://www.thetechnicaltraders.com/eye-opening-index-volatility-charts-and-predictions/

Here are some good articles on how the State will use your bank account to bail in the banks.

http://investmentwatchblog.com/how-the-fdic-will-bail-in-your-bank-account-to-save-the-big-banks/

More articles at the bottom. My balance never seems to get over $150, or so.

[Danny B]

Financial risk,,FED, brought to you by war,,,Corporate meltdown

I got interrupted by time wasters.
A huge part of economic action is related to confidence. Most of that is related to human nature. There is another area of human nature that enters into all of this; RISK
How much are you risking? Here is an excellent article examining how much the financial sector is risking.

Tue, 03/13/2018

https://www.zerohedge.com/news/2018-03-13/taleb-best-thing-society-bankruptcy-goldman-sachs

Comments, "Send ALL warmongers to the front immediately. Boeing, Lockheed, general Dynamics... all board of directors and staff and relatives. and members of congress who voted for "police actions".

Then bankrupt GS and JPM, DB, actually there's a list on https://philosophyofmetrics.com/wp-c...Banks-2015.pdf

"The 2ND BANK OF THE UNITED STATES was 'liquidated' in 1841 (after having been taken private as result of Andrew Jackson standing in the way of its 20 year charter getting renewed, & which, oh by the way, had existed since 1816, which, oh by the way, came about after the FIRST BANK OF THE UNITED STATES, charter had expired in 1811, and whereupon it NOT being renewed right away, the WAR OF 1812 started & Washington, DC was burned to the ground)...

Soon after Andrew Jackson's 'triumph' came to be, the "WAR OF NORTHERN AGGRESSION" (aka ~ The Civil War started), & within 50 years (& 3 Presidential Assassinations occurred ~ not counting the 2 attempts on AJ, and one on Theodore Roosevelt)... THE FED was established.
So yeah ~ LIQUIDATE Goldman Sachs (who is owned by the same banking families who participated in the aforementioned history)..."

1) Too Big To Fail

2) Too Big To Jail

3) Too Rigged To Fail

4) Too Kosher To Jail

Like our war-monger politicians who never get close to the front lines.

Charles Huge smith has a good article about the intersection of 4 cycles.
oftwominds-Charles Hugh Smith: Checking In on the Four Intersecting Cycles
No doubt.
So, do you think that employment will be affected?
Into WHAT?,,,, maybe housing
The hot money has priced Joe six pack out of the market.


None dare call it STUPID.
The feces-for-brains just don't understand. You can't raise prices for people who are on a fixed income. They stop buying. If they can't afford food,,,, then, you have a new problem.

[Danny B]

Armstrong and cycles

Reportedly, "Only the lightest 3 elements were present when the universe were born, and they were: Hydrogen, Helium and Lithium. All heavier elements were made in the centers of stars, either during fusion or during Type II supernova explosions. All elements heavier than iron are created in supernovae."
We are made of stardust. The galaxies are recycled,,, just as we are recycled. The cycles go on and on,, everywhere. We are somewhat aware of short cycles like night & day,,,, winter & summer. The longer cycles are often too long and chaotic for us to factor into our lives. The State would have us believe that we are in a state of permanent prosperity. It has never happened yet.

"The majority of society ignores history because that is the past and somehow irrelevant because we are more sophisticated today and those people ran around in diapers chucking spears at each other. This merely ensures that history repeats because they are far too ignorant to comprehend that life is like a Shakespeare play. It has been performed for hundreds of years and the only thing that changes has been the actors."

"Human society as a whole expects a linear life of happily ever after and when that fails, they advocate punishing the person responsible. They cannot dare investigate that just perhaps the world works in a far more complicated manner than just that.

Those who think only linear cannot avoid the crash and burn. Those who see the world cyclically understand there is a time and place for everything."

https://www.armstrongeconomics.com/armstrongeconomics101/understanding-cycles/what-we-face-requires-a-cyclical-perspective/

This article is about the power shift in Germany but, it has importance everywhere.
"Stalin did everything he could to take power. This has been the curse of the left. They see themselves in a war against the producers and whatever action they take, it is always for the good of the people. This attitude marks the left who always seek to subjugate the right. They never believe in human rights other than their own and have historically always taken an authoritarian position painting themselves as the victim being exploited by the right."

"When you look around the globe, what you see is a rising intense fight building between the left v right, i.e. Thieves v Producers in terms of Ann Rand."
"The left will make a major stand to seize control globally. They will be VERY OPPRESSIVE and this is what will end up destroying the West as we see the economic epic center move to Asia "
"World economic growth (GDP) peaked in 1973" "However, you can easily see from this chart of world GDP, socialism is dying. The Pension Crisis will be a major event and the failure of that system will spark not just civil unrest, but the left assaulting the right. The left will look to plunder the wealth of the right and justify it in their minds as they are entitled to this because the right got rich by exploiting the left. "

"The more the left seeks to raise taxes and punish the producers, the greater the producers will hoard and not invest and we will see a continued decline in economic growth rates. We can see that we really cannot get world GDP above the 3% level. The decline post-2007 has been profound and 10 years of Quantitative Easing has only caused wealth to contract. Negative interest rates sparked more hoarding of cash even among the middle class.

Draghi is holding on for dear life. He has no prayer in hell to restore the economy of Europe. All he has done is kept the governments on life-support. When they cannot sell their bonds, they will raise taxes drastically to try to stay afloat. This is how history repeats. "

https://www.armstrongeconomics.com/armstrongeconomics101/economics/left-v-right-why-the-western-society-is-really-collapsing/

Armstrong sees a lot of black & white. He condemns Jackson for destroying the second national Central Bank. He flat-out refuses to admit that handing that much power to an unelected group to create the money supply would invite disaster. He laments that the FED was forced to buy GOV bonds. What did he think that the State would do when it wanted more money? He DEMANDS that America have an elastic money supply,,, not thinking that the non-producers would stretch the elastic.
His thought processes are tainted because he doesn't recognise that there is a finite limit to the number of people who can get rich just by moving money around.
He recognises cycles in climate but, is oblivious to the pole flip. It hasn't been documented in history so, he doesn't factor it in. Earth is moving out of 2 protective fields and out of a dust cloud. This will greatly increase background radiation and mutations. Weather will become much more volatile.

https://ru-clip.com/video/lmaeF9zjrBI/where-are-we-going-the-fall-of-three-shields-3.html

[Danny B]

Capital flight to U.S. equities

On March 26, 2018, China will launch an oil futures market in Yuan. MANY States have already done currency swaps with China so, it will be easy to buy futures on oil markets with Yuan. Almost every nation in the world is tired of pox Americana blowing up everything that it can't steal. They will be happy to stop financing world destruction.
"BofA calculates that equity inflows are outpacing bond inflows for the first time since 2013, with annualized flows of $717 billion."
"And yet, something odd has emerged: the record inflows are out of step with more muted returns from equities: "chart-topping inflows not coinciding with headline returns."

"another record was broken in the last week when $2.6 billion went into tech stocks this week, an all time high, putting the excesses of the dot come era to shame. So far, a total of $9.8 billion has gone into tech funds YTD, making the annualized flow figure a massive $46.5 billion."
"But wait, there's more: there was also a record inflow into US growth ($5.8bn), US small cap ($5.4bn), and US value ($4.1bn) funds.

"Meanwhile, European stocks saw modest outflows of $1.3 billion," EVERYONE in Europe knows that Draghi will fail spectacularly. They are pulling their money out. Armstrong states that the ECB won't be able to sell sovereign bonds. Armstrong claims that they will resort to tax increases. For every Euro of additional taxes, the economy shrinks 3 Euros. After all, taxes reduce the operating capital of the country. So, add in the capital flight to the tax increases.
There are massive inflows to American equities, not so much for earnings,,, more so for protection.
Corporate America is dead in the water. The FED hopes to attract capital to America by raising rates. These rate hikes are destined to kill off corporate America. Corporate America went on a debt splurge to buy up their own stocks. Corporate America does NOT have enough earnings to service their debt. It is doubtful that capital inflows can save a company that has no earnings.

There are lots of States that would prefer to buy oil in Yuan, instead of dollars. DEDOLLARIZATION - Unwanted dollars are coming home to roost. Investors will send their dollars here and hope to lose less than they would have lost if they stayed in European markets. Everybody reads Armstrong and his warnings that U.S. sovereign debt will crash. Not much is flowing into sovereign debt. "Treasuries funds drew in $0.3 billion"

https://www.zerohedge.com/news/2018-03-16/bofa-stunned-record-wall-money-inflows-equities-has-three-warnings

So, America is predicted to be the last to collapse. BUT, when European bond markets collapse, most other markets will die of contagion. The derivatives held by Deutsch bank amount to 6 times the German GDP.
The time between European collapse and, American collapse may be measured in seconds. It is stated that these particular derivatives cancel each other out and, only leave a nominal amount of , perhaps, $1 trillion.
THAT will occur if ALL the counter parties pony up the money.

$11 trillion just doesn't buy what it used to.
We have to re-train gardeners to write code.
ONLY the upper loop.
The new FED head says to "buy dollars and, sell gold. Yeah, right.

https://imageproxy.themaven.net/https%3A%2F%2Fs3-us-west-2.amazonaws.com%2Fmaven-user-photos%2Fmishtalk%2Feconomics%2FzmfATcSa4EegwR7v_znq6Q%2FdACkHyJpakqt6_4cFJsy8A

[Danny B]

Morality and commerce

Mother Nature does not "do" morality, ONLY survival. From plankton to the brontosaurus, it is all about eating and surviving. Man creates a society to escape the simple "law of the jungle". Agriculture allowed man to produce surplus food and create a peaceful society. Without surplus food, we return to the "law of the jungle". Witness Rhodesia where they got rid of the farmers and, the "law of the jungle" returned.

In a peaceful society, the creation of scientific advancement means that man can get better control of the environment and, his security and future. He can escape a "brute existence".

The "law of the jungle" is simply, the strong killing the weak. The adherence of society to morality allows for a peaceful and productive society / economy. Either we adhere to morality or, we return to the jungle.

When the practical limitations to the expansion of the money supply ended, the bankers were free to spend any amount of money to buy politicians. When the immortal corporation was created with almost complete legal immunity, the resulting monster was almost completely free of moral considerations. Regulatory-capture meant that nothing that the bankers wanted to do was illegal.

Religion was a convenient vehicle to teach a moral code to our children. Society can't exist without ingrained moral guidance. NO law can control a man who refuses to control himself. Because of the nature of the corporation, it has even less self-governance related to morality.

The State is equally immune from prosecution and, equally immortal. History proves this to be untrue but, the State operates as if it were unlimited and immortal.

Society and religion gave us a god who has rules to propagate society and religion. God is all-powerful and doesn't need to lust after power. He gives us 10 major rules for the continuation of a moral society. We must teach morality to our children or, watch the dis-integration of society. Morality is a HUGE hindrance to the "law of the jungle".

The corporate banking "machine" is strictly predatory.

The State is strictly parasitic. Socialism is immoral, in that it is theft. Socialism is impractical in that, it robs reward and incentive from the producer.

South Africa is in the process of taking the farmland from the producers. They can see what resulted when the same thing was done to Rhodesia but, the socialists won't let that stop them.

Moral collapse brings financial collapse. Predations of the State eventually bring revolution. There doesn't seem to be ANY exceptions.

History fails to record a single precedent in which nations subject to moral decay have not passed into political and economic decline. There has been either a spiritual awakening to overcome the moral lapse, or a progressive deterioration leading to ultimate national disaster. Douglas MacArthur

The bankers get a good laugh when the rip off the "muppets". They can salve their conscience by claiming that they did nothing illegal. Maybe they feel a twinge of guilt at killing and robbing MANY millions of people. Here is a vid from a movie about a guy who personally gets revenge on those who destroyed him and his wife.

Assault on Wall Street Best Scene

https://www.youtube.com/watch?v=JtwnQjVBkKA

https://www.youtube.com/watch?v=C56UI1ML9MQ

Putin is doing his best to create a resurgence of the orthodox church in Russia. The West is doing it's best to purge the 10 commandments and any traces of religion from society. Then eventual result will be a further collapse of trust and commerce.

[Danny B]

https://i1.wp.com/dollarcollapse.com/wp-content/uploads/2018/03/Bond-default-rates-vs-corporate-debt-March-18.jpg?resize=550%2C344&ssl=1

2008 - Financial Times (Gillian Tett): "In recent years, bankers have succumbed to the idea that the credit world was all about numbers and complex computer models. For as anyone with a classical education knows, credit takes its root from the Latin word credere ("to trust") And as the current credit turmoil now mutates into ever-more virulent forms, it is faith - or, rather, the lack of it - that has turned a subprime squall into a what is arguably the worst financial *crisis in seven decades. Make no mistake: what we are witnessing right now is not just a collapse of faith in one single institution (namely Bear Stearns) or even an asset class (those dodgy subprime mortgage bonds). Instead, it stems from a loss of trust in the whole style of modern finance"

"One can age the mortgage finance Bubble period at about six years,"
"We'll soon be approaching 10 years of what I back in 2009 labelled the "global government finance Bubble."

https://creditbubblebulletin.blogspot.com/2018/03/weekly-commentary-nobody-thinks-it.html

Stockman, "Goldilocks is a conceit of monetary central planning and its erroneous predicate that falsifying financial asset prices is the route to prosperity. In fact, it only leads to immense and unstable financial bubbles which eventually crash-----monkey-hammering the purported Goldilocks Economy as they do.
To wit, the Fed's serial financial bubbles on Wall Street are falsely celebrated as arising from a booming main street economy. In fact, they are an economic dagger that bleeds it of investment and cash and exposes it to "restructuring" mayhem from the C-suites when the egregious inflation of share prices and stock option values finally gets crushed by another financial meltdown."

Larry Kudlow, December, 2007Jobs "That said, our more essential point is that the BLS numbers are generated by a trend-cycle statistical model, not an honest-to-goodness body count, or even sample extrapolation, from the actual main street economy"
" After Q4 2007, the US economy shed more than 15 billion labor hours during the next six quarters."
"So by Q1 2009 the household net worth number was down by the tidy sum of $12 trillion or nearly 20%. And it took four years of madcap money printing at the Fed to reflate housing and the stock markets sufficiently to regain the Q3 2007 level"
"In a word, Larry Kudlow can be counted upon to reassure the Donald that a boom is just around the corner, and that the nation's skyrocketing budget deficits are nothing to worry about."
"That's when the rock of $1.2 trillion in new government borrowing smashes into the hard place of the Fed's $600 billion annual bond dumping program."
Contra Corner » Goldilocks, R. I. P. (Part 2)

Need to break this up.

[Danny B]

Questions on GDP

Gross Domestic Product has been a VERY slippery number. Advertising is counted but produces nothing.
Study: Ad Industry Accounted for 19 Percent of U.S. GDP in 2014 – Adweek
Sales of financial instruments and stocks are not counted. Un-reported legal business is not counted and, is 2/3 of the underground economy. Illegal underground business makes up the other 1/3 of the underground economy.
Illegal drugs make up a huge part of the underground economy.

https://image.slidesharecdn.com/gross-domestic-product-what-is-not-included-12300/95/gross-domestic-product-what-is-not-included-10-728.jpg?cb=1232131866

https://www.slideshare.net/knorman31/gross-domestic-product-what-is-not-included

https://www.economist.com/news/briefing/21697845-gross-domestic-product-gdp-increasingly-poor-measure-prosperity-it-not-even

https://www.goldmoney.com/research/goldmoney-insights/the-egregious-errors-of-static-statistics?gmrefcode=dollarc

[Danny B]

The FED and the S-400

Armstrong forecast in 1985 that there would be a huge change in the confidence model on 2015.75 On that very day, Russia proved in Syria that it could jam and block American offensive weapons. This has caused various States to see Pox Americana as less than invincible. Later, the Russians deployed long-range cruise missiles that demonstrated anti-ballistic-missile systems to be obsolete. Moving on, Russia followed up on the very successful S-300 missile system with the S-400. The S-300 could arguably take out all naval assets. The S-400 kills planes.
Many States are buying the S-400. One could argue that they want protection from CENTCOM, the enforcement arm of the FED.

Pox Americana can only protest these purchases. It wouldn't look good if they gave their justification for protesting.
"Russian S-400 talks with China, Turkey, India, Saudi Arabia, Qatar, and any other country."

https://sputniknews.com/us/201803171062621903-usa-russia-s400-foreign-nation/

Duterte has sinned twice, "Having encountered difficulties procuring weapons from the U.S. due to disagreements over his shoot-to-kill drug war" He's trying to block CIA drug cartels from destroying his people.

[Danny B]

Weakening bonds,,, insane P/E,,, burn down the economy with corruption

Where to start? Is Armstrong correct about the bond markets because, that is where they are going? Are the bond markets going "there" because Armstrong has predicted it? Just the same, the bond markets are not looking so good. Here is a quick tutorial on the bond market.
"Bid-to-cover ratios typically exceed 2.0, especially for shorter-term securities."

https://www.investopedia.com/terms/b/bidtocoverratio.asp

If the bid-to-cover ratio isn't very high, investors can demand more interest. $230 trillion of hot money floating around has insured that bonds get a healthy bid-to-cover ration.

"in credit boom times - get orders for three or four times as many bonds as are for sale, at the beginning of the week order books were barely two times covered. " "fundamentals are starting to shift with the Fed expected to lift rates three (or more) times this year, retail sales falling for third straight month, amid a near contraction in consumer credit growth." "sales volume for new investment-grade corporate debt is at its lowest level so far this year"
Corporate bonds must always yield more than treasuries to make sales.

https://www.zerohedge.com/news/2018-03-18/bond-market-hits-tipping-point-what-means-stocks

International capital is flowing into equities but, not so much into corporate bonds.

What about sovereign bonds? "Astoundingly, despite the lowest global interest rate environment in 5,000 years of recorded history, Brazil and Greece are paying over 30% of all tax revenues to service their debts. India, Japan, and Ireland are paying over 20%, and Italy, Portugal, and France are paying over 15%."
"Japan, for example, is paying nearly 24% of its tax revenues to service its debt, despite only paying an effective interest rate of 1%! Even a modest normalization of interest rates from 1% to 4% would consume 100% of current Japanese tax revenues."
Sovereign Debt Crisis - Interest Expenses Are Already Consuming Large Portions of Tax Revenue - The Sounding Line
You can see why sovereign bond debt is not attractive.

You can see why the quantity of money theory is bogus. We don't have hyperinflation. Hyperinflation is brought on by a change / lack of confidence. Will we get hyperinflation when sovereign debt crashes?
Dunno.

https://www.armstrongeconomics.com/armstrongeconomics101/economics/the-unsound-theory-of-inflation/

Contra Corner » Goldilocks, R. I. P. (Part 3)
John Hussman is widely read. He has shown very clearly that the stock market can't expect to have any earnings for at least the next 10 years. All this hot money pouring in is from investors who are only trying to protect their capital. Stockman may be right about the absurd P/E but, that doesn't mean that investors will run away.

Europe has about $1.2 trillion in non-performing-loans. This will eventually bring down the banking system because they just aren't profitable. Their solution,,, pretend that they don't exist and, lengthen the terms. This is excruciatingly stupid because the interest burden still grows.
"After almost 10 years of Quantitative Easing to help banks, nothing has been achieved." "The Quantitative Easing has simply kept governments on life-support while failing to stimulate the economy. Mario Draghi moved to negative interest rates in an effort for force people to spend. Instead, the bought safes and withdrew cash from the banks."

https://www.armstrongeconomics.com/world-news/banking-crisis/eurozone-banking-crisis-ecb-delays-rules-for-bad-loans-until-2021/

https://www.theautomaticearth.com/2018/03/whiskey-tango-foxtrot/

Armstrong, "The collapse in the rule of law is so vital for sustaining the economy that it is often overlooked."
GOOD article on corruption, https://www.armstrongeconomics.com/w...beyond-belief/

[Danny B]

Mixed headlines

Too many things are up in the air to get a clear picture. But, even an unclear picture is pretty bad.
They were given most favored nation trading status. This will undo a portion of that.
The darling tech stocks are NOT looking well.
The banks believe that they have off-loaded risk by selling derivatives. It didn't work last time.

So, why is Facebook doing so badly? Did the word get out?
Snowden - Facebook Is A Surveillance Company Rebranded As 'Social Media'
Not true,, they will die.
To CLARIFY, CUT everything.that the State supports.


Very curious. Here are 2 vids that might shed a light on this.

https://www.youtube.com/watch?v=os4CJhvZh5M&t=209s

https://www.youtube.com/watch?v=3cx5sZoSiIQ

NO PROBLEM. Put some black electrical tape over the warning light.
Canada is a peripheral economy. It is far more likely to hyper-inflate than America.
The ECB has pumped in about $2.5 trillion into markets. Yes, there is inflation in the upper loop. Shut off the bond spigot and you will see deflation that rips Europe apart. Draghi prays every night that normalization will hold off just a bit longer.


You have been forewarned. When a solar storm takes out the grid, be sure to blame Russia.
Minsky writes about the 2-price system of the economy. I just refer to the upper and lower loop.

https://pro.creditwritedowns.com/2018/03/hyman-minsky-asset-price-inflation.html

Humor https://www.zerohedge.com/sites/defa...n_garrison.jpg

https://www.zerohedge.com/news/2018-03-17/one-artists-impression-fall-hillary

The State and the CBs definitely don't want capital to flow into something that they don't control. Here is a history of the suppression of the price of gold.

https://www.rt.com/business/421618-central-banks-manipulating-suppressing-gold/

There is about $1.6 trillion in U.S. currency in circulation. 60% of that is held outside the country. A freeze in the credit markets would make that paper money quite scarce. The State does not want you to have wealth stored in anything that they can't control and grab. If you're Canadian, get some American cash.

[Danny B]

If You Come to a Fork in the Road, Take It - Kunstler

https://www.armstrongeconomics.com/world-news/civil-unrest/the-collapse-of-society-are-the-doom-gloomers-even-on-the-right-page/

Armstrong sees a socialist under every rock. He laments the collection of taxes. He makes no mention of the enormous riches that are channelled to the powerful corporations from these taxes. He makes no mention of crony capitalism that is just socialism for the rich. Socialism for the rich is now costing 10 times what socialism to the poor costs. $1.5 trillion vs $15 trillion. He makes no mention of the horrendous cost of wars that are primarily initiated by the bankers. He laments the public pension system. He makes no mention of the fact that the banks take our money and front-run everything that we buy. We can't save enough for retirement. 50% of the cost of everything that you buy is for finance.

Naturally, he is a fan of Any Rand. "Despite arguing that government benefits constitute an immoral redistribution of wealth, Ayn Rand received Social Security payouts later in life."
Like Ayn Rand, Armstrong sees everything in black & white. Private enterprise is too cost conscious to do R&D in many areas. DARPA and the space program have created enormous spin-offs

https://spinoff.nasa.gov/

https://www.mensjournal.com/gear/darpas-greatest-inventions-20140108/

Pure capitalism is a predatory system when there is no State regulation. Here is a graph of interest rates. https://d33wjekvz3zs1a.cloudfront.ne...Rates-2012.jpg
Interest rates reflect risk. As the world becomes more stable, risk goes down. Everyone benefits from stability,,, except the bankers. They are currently trying to get a big war going to get the money rolling in. The jackals and hyenas of the world thrive on chaos.

Xi is in for life.
Putin has another term.
Trump will probably get a second term because the unfolding charges will taint the dems for the next 1000 years.
Celente states that the bankers are mafioso in suits.
These 3 leaders are NOT looking for war. The unravelling after WW II in Europe brought economic integration. Could you imagine England invading France? It is possible that these 3 leaders can bring enough economic integration to the world to make war a thing of the past.

Armstrong on the rise of interest rates.

https://www.armstrongeconomics.com/markets-by-sector/interest-rates/how-can-the-majority-be-wrong-if-they-all-expect-interest-rates-to-rise/

I think that he is missing the boat here. The debt burden can NOT grow if the population is shrinking. Armstrong's central model is a model of confidence. What would bring a rise in confidence that would induce people to have more children? The muzzies are working on that problem but, it is the dumb ones that are proliferating the most.

[Danny B]

RE speculators,,, wages

Here is an article on cumulative advantage & winner take all. It fails to mention that capitalism without morality is (financial) law of the jungle.

https://medium.com/the-mission/the-1-percent-rule-why-a-few-people-get-most-of-the-rewards-d92ca43baa0e

We had the reserve currency but, it was locked into the gold standard. We could not run a trade imbalance. We had to kill Bretton Woods to pump up credit enough to become a war-monger.

Median home prices, https://imageproxy.themaven.net/http...nk66EUSYnca44w
"The median wage rose from $14.15 in 2005 to $17.81 in 2016, a percentage increase of 25.9%.

The median new home price rose from $228,300 in 2005 to $335,400 in 2016, a percentage increase of 46.9%."

https://www.themaven.net/mishtalk/economics/fallacy-of-wage-growth-and-a-housing-shortage-in-pictures-nLTVDCo4L02q-0HMfgCx3w

https://mhanson.com/3-17-hanson-house-supply-shortage-red-herring-next-foreclosure-type-cycle/

There is a 23.2% gap between the trendline and, what people are actually spending.

http://realinvestmentadvice.com/wp-content/uploads/2018/03/Retail-Sales-Per-Capita-031818.png

The rapidly growing gap between disposable income and, the cost of living.

http://realinvestmentadvice.com/wp-content/uploads/2018/02/Gap-Income-Spending-Saving-022718.png

http://realinvestmentadvice.com/recession-when-you-see-it-it-will-be-too-late/

Can it be embraced?


Probably because of life-to-death surveillance.

[Danny B]

March 24 and the petro Yuan

When the USSR collapsed, there was a collapse of Russian bonds. This would have taken down LTCM and brought down much of the Western financial system. A rescue was engineered. Jim Rickards was the lead counsel in the group effort to save the system.
A few years back, the US's 14 intelligence agencies figured out that something was wrong with the American economy Intelligence, my arse.
Anyway, they evidently didn't have anybody in-house who knew anything about finance. They called Jim Rickards and asked him to lead a group that was doing a war-game scenario simulation of the economy on the DOD computers. Rickards knows the bond markets. They set the whole thing up on DOD super computers and, came to the conclusion that the economy was going to collapse. I'm absolutely sure that the DOD computers didn't have the depth of information that Armstrong has.

Rickards is something of an attention hound. Just the same, he has a lot of experience.
JIM RICKARDS - End of March, Elites Will Block Your Access to Your Own Money

https://www.youtube.com/watch?v=4EXY0XNCeXY&t=66s

Jim Rickards and David Stockman The Next Financial Crisis on March 24, 2018

https://www.youtube.com/watch?v=emBwSohfvTk

The net is ablaze talking of the crash resulting from the introduction of the Petro-Yuan. Keep in mind that no State can print currency and call this "reserves". They must sell stuff to get dollars. THEN, they have currency reserves. They sell us stuff on credit and take treasury bonds as payment.
The petro Yuan will be an oil futures market. States no longer need to hold dollars to create forward contracts in oil. The only way that States can sell us stuff to earn dollars is; they must undercut our domestic manufacturers. Since US bankers have your savings to front-run everything that you buy, everything is doubled in cost. Many States find it very easy to undercut US domestic prices.

The original and ONLY reason for the bank system is; to promote the productive economy. This has been turned on it's head in America. The productive economy is held in thrall to the bankers. China has a roughshod public banking system that can consistently undercut the price / cost of American finance. We can't compete in international markets.
The introduction of the petro-Yuan will incentivise many groups to abandon the very expensive dollar.
The US military has already done the same thing.

The reserve status has meant that exporters must hold a running negative account balance on their exports to America. We buy about $1.5 billion a day more than we sell. At what point will exporters no longer accept dollars? About 95 million barrels of oil are consumed every day. About 19.5 million in America. Selling oil contracts in Yuan will send shocks through the markets.

At the same time, the U.S. is cutting back the supply of dollars to international markets. They desperately need dollars for dollar-denominated loans. Many States have done currency swaps with China. One could guess that they will use Yuan for oil contracts and, use their dwindling supply of dollars to service dollar loans.
I presume that there will be a big shock to markets. I doubt that it will all come crashing down on march 24.