CRASH2: The Risk List in full, and why the collapse is an eventuality we cannot resist

blackholept

GLOBAL CRASH PESSIMISM IS THE ONLY SANE POSITION TO ADOPT. DEBT FORGIVENESS REMAINS THE ONLY SANE WAY TO PREPARE FOR IT.

Following on from last night’s Slogpost about the world being upside down and pointing slightly to the left (thus ensuring a mess in the bathroom) I want to answer a perfectly reasonable comment thread from a couple of days back: a lady asked me if I’d “gone cold” on the concept of Crash2, and I replied in the negative – the Crash2 alternatives have taken on so many potential guises since 2008, one would be better dubbing what’s ahead ’12 Crashes’.

But the truth is, I’d just forgotten to use the branding in the helter-skelter pellmell of signs getting more numerous and obvious with every month. I withdrew the last of my pension and other investment dosh from the markets three months ago on that basis. You can lose money-growth by leaving the bubble too early, but the loss of shirt factor is reduced to 0% . It’s an adage I’ve always stuck to, because I’m an observer, not a gambler.

So, Crash2. Why is it inevitable? Well, the truth is that nothing is inevitable, but most things are eventual. The eventuality of Crash2 seems so real to me now that I suspect the more relevant question any opinion-leader should be asked is “Why would it not happen?” But they’ve always got an answer to that one, so on further reflection the best approach is simply to go through the table of doubts one by one, and show why it stands about as much chance of flying commercially as Howard Hughes’s Spruce Goose.

I’m calling this the risk list. It’s like a wish list for depressive Marxists. Here it comes:

1. Based on no commercial rationale whatsoever, the US Dollar is heading for the stratosphere.

2. Based on zero belief in the empty Eunatic promises, the Euro is plummeting – and stands this morning at 1.42 to the Pound.

3. Based on no fundamentals whatsoever, the stock markets are at record highs.

4. Nobody has as yet been able to gauge how many derivative bets on the eurozone will go wrong, but whichever way things develop, we’re talking a figure in the trillions of dollars.

5. The bailin alternative to banking bailout is already being shown up as a nonsense in the case of Austria.

6. Despite its 100% failure rate to date, QE is about to be splurged into the eurozone. In Japan it is being applied on a scale that reeks of insane desperation.

7. Against all the market rules about safe havens in the context of things looking wobbly elsewhere, the price of gold is falling. But sales of the metal available to the general public are booming.

8. In line with a global depression (about which every government on Earth is in denial) the price of oil is falling. But its rate of decline has been alarmingly sudden – based entirely on a geopolitical row-cum-mutivariate-pissing-contest involving Saudis vs Frackers, Texas vs ISIS, and Russia vs The West.

9. With rising levels of unrepayable debt – and an acceleration in the rise of deficits across the West – most Sovereigns lack either the State funds or the consumer confidence to consume Asian goods.

10. Liquidity for business and consumers remains an enormous problem with no solution in sight: in the barmy model of capitalism being put forward, every signal, bourse and statistic relies totally on cheap credit to keep the show on the road. But interest rates have to rise: and that will run the Circus into the ditch.

11. With record wealth destruction at the bottom end and the financial power shrinking against that of rich capital, who’s going to consume the mid priced mass-market goods?

>>>>>>>>>>>>>>>>>>>>>

So, there’s the list: where’s the risk? Fasten your seat belts please.

a. If the US Dollar is rising and the euro is falling, how is America going to export its goods – and thus lower its deficit…especially as domestic consumption of US goods isn’t cutting it? The answer is, it won’t. Some facts to ponder: The EU countries rank 2nd as an export market for the United States – 16.6% of overall U.S. exports go there. Already, the U.S. goods trade deficit with the EU is $125.1 billion….and growing at the rate of 7% per annum. A strong Dollar will devastate that trade. (Hence my view that Draghi could well be working for Wall Street, and towards a Eurodollar at parity with the US).

b. What happens when businesses trading in the eurozone come to buy raw materials next time – and find they have to pay 30% more? Answer: old fashioned upstream price inflation. “Great,” says Draghi, “that’ll counter the the deflation”. No it won’t, because they have different causes: all sales of imported goods using ex-EU materials will fall, more jobs will be lost, more faith in the euro will be lost….viciously circling into hyperinflation, and depressing US exports even more. (See above re eurodollar: hyperinflation attracts carpetbaggers).

c. The reasons the bourses have been booming are first, QE, second, more QE, third, yet more QE, and fourth lack of reliable returns from anywhere else – gold, commodities, bonds and so forth. But the US Fed continues to taper off the cocaine supply. Already, Forbes, the Daily Telegraph, Jim Rickards and even the CIA are on the record as saying the Dow is “an over-leveraged ticking time-bomb”. The sell-off two days ago has not as yet managed any kind of rally. The FTSE plunged too, although it’s now looking better. However…

d….this is where Bank shakiness becomes a serious factor. Derivative bets on the euro generally, I’d imagine, are relatively skewed towards success rather than failure. We are no more than 10 weeks away from its failure becoming obvious: not just because of the bad signs now spreading from Greece to Austria and France, but also the reality sinking in that the ECB/Frankfurt/Berlin axis have run out of time with which to bluff. Nobody knows for certain how it will pan out, but IF Troika2 decides to squeeze Greece into submission – and Syriza says “Fine, we default”- Resistance Contagion will spread very rapidly. Then we will see Greek banks fail, derivative bets hitting US banks, and a Major League panic on the bourses.

e. The Austrian bailin currently falling apart in a storm of intra-member litigation is no way going to be enough to cover the losses. But it’ll be a ride in the park compared to problems in Deutsche Bank…and others I could mention; however, being a French resident I don’t want a €25,000 fine for saying so. Je ne suis pas un Charlie.

f. For the ECB, there are no downsides to the Dragula QE bonanza. But there are huge risks on other dimensions. Pushing the Swissy back up in value has already helped cause the Austrian situation. It’s also left the Gnomes looking for revenge. Don’t ever, ever mess with the Swiss or the Jews.

g. The very fact that the perceived value of gold is being destroyed with accelerating persistence means we have to ask the question, “Why would anyone want gold to be cheap?” In a confused and totally abnormal environment where you’d expect folks to be hoovering it up, the folks who would have done that very thing are being persuaded that it’s not safe…that gold is dead for eternity as a safe place for your increasingly worthless fiat money.

So who are the directionalisers, and why are they doing it? I think it’s a combination of Western central banks wanting gold ready to distribute among ‘ordinary’ banks, and then suddenly revaluing the stuff…to stop bank failures once the crash comes. But in the ‘war’ against Russia’s oil exporting business, the move is counter-productive: Putin is gleefully amassing all the bullion he can get hold of. Either way, the move is not happening for the good of investing humanity – QE and Zirp proved that. It means some VIPs want their arses saved. Which can’t be good news for the rest of us.

I wrote five days ago that gold through $1160 and testing $1150 would be a very bearish signal. It tested the second level yesterday, but has rallied overnight. When the NYSE opens, we’ll see what’s what.

h. Falling oil prices in the pursuit of geopolitical ends would be great if there was consumer demand for the manufacturers using it to make products. But there isn’t. So the glut-price plummet vicious cycle will continue to the bottom. The point here is that oilcos will cease exploration, see profits slashed, and watch their share prices falling…and that creates nerves. In reality, manipulating an already falling energy form further down to the sewers is almost like doing anti-QE: it makes a stock market rally impossible to rationalise. It will also trigger tens of millions of Bullish derivative bets. And so we’re back to Tsunamis hitting banks, and CBs needing to grab all the gold, give it to locals, and then ban it for use as a legal trade before whacking up the price.

i. The trouble with mercantile globalism is that it is by definition a pandemic waiting to happen. Globally aligned banks are a suicidal idea, but the same applies to globally marketed products. If western consumers and their governments have no money for genuine Keynesianism or welfare help, nobody buy Chinese product. Nobody buy Chinese product gives Beijing big problem with stagnant economy and indignant glorious Chinese Worker. (As for the military consequences of this versus Japan and with Russia, I don’t want to go there).

j. When those not singing from the NATO hymn-sheet (China, Russia, South America, north Africa and perhaps even Australia or Canada….or Greece) decide they need to get new money to invest and rebuild their destroyed economies, the best weapon they will have by far is interest rates: especially when no investor anywhere on the planet can make a turn on other things any more. We’ve already seen this in Russia: the fish didn’t bite because things aren’t bad enough yet. But when the stock markets go from wobble to dive – and goldbugs say to hell with the warnings, let’s BUYBUYBUY, then we are going to see everyone in NATO having to pay more to borrow money. Be they bond yields or interbank bridging loans, rates will go up, liquidity will dry, fear will stalk Wall Street and banks will fail. As soon as gold rises and the bank failures start, the market will easily overrule the directionalisers: thus, not having cheat-metal on their balance sheets, yet more banks will fail.

US debt maintenance will go out of control, and the most likely eventuality is….yet more hyperinflation. That solves the Washington elite’s debt problem, but leaves the rest of us etc etc, see earlier. Don’t even try to calculate what derivative bets will have gone wrong by then: they’ll be like stars in a giant nebula streaming into the biggest Black Hole in the Universe.

k. The final point about wealth inequality begins to look irrelevant in such a Domesday cataclysm, but actually it isn’t. Because once everything is levelled and smouldering, two things will happen. One, enough enlightened people will abandon neoliberal claptrap and say, “Right, let’s forget all the promises of jam tomorrow, scale down everything to a manageable level, and switch the emphasis from the f**king rich model to the mutualist consumption alternative”. And two, at some stage either before or after that, the nothing-to-lose poor will suggest eating the rich. There will be no shortage of opportunistic pols offering to effect that outcome. Whether that can be done peacefully is anyone’s guess; clearly you can’t eat people peacefully, but then the victims in this case might represent an overdue cleansing of the gene-pool.

I jest, of course. But no oligarchy in history (except oddly, the latter-day British Empire) ever voted to abolish itself. And even in that case, American arm-twisting and huge management costs were probably bigger factors than Socialist idealism.

>>>>>>>>>>>>>>>>>>>>>>>>

I’m not saying this analogy really works for sure, but the contemporary Greece/Troika2 struggle could be regarded as an early sign of the coming end of neoliberal self-serving sanctimony. My point in writing this essay, however, is partly to put the Greek debt into some kind of sane perspective. People at my end of Europe constantly parrot the “we most not encourage default” line. But it is based on self-interest among the few, and ignorance among the many. To outline why the ignorance should be addressed and the Establishment lies revealed, I shall close with these points:

* Greek debt is a tiny speck of dust in the coming sandstorm: better to have it out of the way and Greece functioning as a proper economy again rather than waste time on such a trivial issue. Any other approach, frankly, would be pure spite. With which, of course, Wolfie Wheelchair is suffused.

* Only by clearing out the seriously nasty cabal in Spain and the UK can some impetus be given to ditching the elite in favour of a more Benthamite approach: such would mean Spain defaulting eventually, and Britain seceding from the Union. The destruction of the euro and the EU are must-haves in that process.

* The Greek debt was run up as a result of mad Wall Street and ECB lending policies, greedy elite borrowing, oligarchic corruption on a grand scale, and fraud used by Goldman Sachs to keep Brussels in the dark. Not a penny of it was borrowed by the ordinary Greek citizen. We should not starve the People as a solution: we need to destroy the US elite and its Wall Street drivers who were behind a great deal of it.

* Finally – and for the last time – no cost whatsoever to the ECB, other central banks or any EU citizen is going to emerge from Greek default: the only effect will be a positive epidemiology in favour of reform to hand power back to the taxpayer.

Also connected from Yesterday’s Slog: The Troika myths debunked

39 thoughts on “CRASH2: The Risk List in full, and why the collapse is an eventuality we cannot resist

  1. “But no oligarchy in history (except oddly, the latter-day British Empire) ever voted to abolish itself.” Except I don’t think it actually did. The old money simply changed form into the military-banking-oil-media complex. don’t forget that the British in fact didn’t “own” India entirely. A huge chunk of it was the Princely States, puppets which were installed to administer their own provinces and they were even more brutal to their own than the British.

    The money went into the Standard Oil and Chevron consortium Aramco, formed a chunk of the Trucial States into the now “cool” Dubai and Qatar, less so Oman which is still very British even now. All underpinned with US/UK arms and money.

    Why could one buy a home-brewed pint with impunity on a British Aerospace secret bar? Because BAe could walk on water out there.

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  2. “benthamite”, do you mean bottom-up?
    Beautiful piece of writing, I now know why I look forward to reading his blog every morning. More power to your elbow!

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  3. JW. For sure a rocky ride, as the Augean stables of the Eurozone are cleansed by the market throughout this year. So, the Euro will be oversold, the $ overbought, and do not regard £ as a safe bet. Crash 2? Maybe. Methinks RDS and Antofagasta represent value. You need to avoid banks, insurance companies, supermarkets, and look for brilliant British engineering businesses ( there are at least five) that our Japanese friends will gobble up, like Domino.

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  4. A veritable thesis there JW, but I’d like to raise a point from a tiny part of your essay. You mention that you don’t wish to mention certain banks for fear of a fine. Can we hear more about this law that forbids discussion and debate about one of the most basic requirements for daily existence? If the electricity generation industry was in danger of fragmenting to the point that it no longer functioned one would hope that the populace would be allowed to discuss it??

    On another tack this appeared in a comment thread on Zerohedge ages ago, the guy was called Dochenrollingbearing and he was in industry and sounded like a pretty sensible chap, I thought it was quite relevant to the gold aspect of JW’s above piece.

    I quote..

    ‘A mate of mine asked me what’s going
    on in Cyprus and Europe as a
    whole….kind of a pointless question
    without the Big Picture.
    Here is my response;
    Yeah, the more I read the bigger this whole game
    is…and it really is a game of winner takes all.
    You have many factions woven into several layers
    within the game. There are the countries around
    the world, there are the major financial
    infrastructures, there are the superrich entities,
    and there are the banking entities which stitch
    the layers together…which makes sense.
    The best way to think of them and how they
    interact is by way of a Venn Diagram (below),
    then this will all make much more sense.
    Take a simple Venn Diagram with 3 overlapping
    circles (A + B +C). Note that there are a total of 8
    sectors including space outside the circles.
    http://upload.wikimedia.org/wikipedia/
    commons/7/7a/Venn_diagram_cmyk.svg
    Let’s say that;
    A = Are the countries of the world
    B = Are the major financial infrastructures of the
    world
    C = Are the banking entities of the world
    The next layer is where just two of the major
    players overlap;
    A/B = Military Industrial Complex and Major
    Corporations
    B/C = Central Banks
    C/A = Major Banks
    You can now see how every entity is affected by
    every other entity, to varying degrees!
    There is also another sector, right at the centre.
    This is the Superrich entities who own most of the
    real assets on the planet, such as a vast majority
    of Military Industrial Complex, the Major
    Corporations and the Major Banks, as well as most
    of the natural resources. Since the Major Banks
    own the Central Banks, then the Superrich own
    the Central Banks as well.
    Now here is where it starts to get a little grey…..
    Who is at the centre?
    Well, there are at least three types of Superrich
    entities, they are;
    1. The ultra-wealthy families who have had
    money since at least the 1700s’. These families
    are well known historically but they are very well
    hidden today, so too is their money (Gold and
    something else).
    2. The Oil wealthy such as the Arab states.
    These are newcomers to the centre and their
    future is tied-up with the prosperity of their
    countries; if the country falls, so do they.
    3. The Oligarchical wealthy. More newcomers
    who have recently emerged from the end of the
    Cold War. These include most of the families
    which prospered from the Military Industrial
    Complex, like the [George] Bushs’, and Mafia type
    Oligarchs like Putin and his KGB mates.
    Ok, so that paints a picture of how all the visible
    entities fit together…..but there’s another layer.
    This is a very, very well hidden layer.
    Imagine that the Venn Diagram (the whole world)
    is drawn on a single piece of paper, well, who
    owns that piece of paper???
    I believe that the next and final layer doesn’t
    really have a name…but I’ll call them the
    Custodians! The Custodians essentially won 80%
    of the world between the 1300’s and 1700’s.
    They comprise of many or most of the Ultra-
    Wealthy entities dating back as far as the Black
    Venetian Nobility, the Templars, the Teutonic
    Templars, the Vatican, and later entities such as
    the Rothschild family.
    On the Venn Diagram these Custodians own most
    of the paper as well as the entire centre sector of
    the Venn Diagram.
    These Custodians own vast, vast sums of wealth,
    accumulated over centuries. I believe the sums
    would be in excess of $700 Trillion. HOWEVER,
    this figure is not a Dollar figure, or a Yuan figure,
    or even a Euro figure and this is why…
    When Rothschild created the Central Banking
    System he also created a layering of the system
    where, the Major Banks in each country owned
    the Central Banks from whom they borrowed the
    money. BUT, as with all systems it is built upon a
    network, and in the case of the Banking System
    and the entire Global Financial System it is built
    upon a framework (network) which is 100%
    owned by these Ultra-Wealthy elite families. It has
    been this way since the end of the Napoleonic
    War, where, Napoleon threatened the entire
    European Banking System as he believed in a
    Bank of France which lent money at 0% interest…
    he hated Banks, and Banks hated him!
    So the real question is, what is the framework,
    what is the network???
    The Custodial Framework
    United Nations – Global Police
    World Bank – Global Lender
    International Monetary Fund – Global Debt
    Collector
    Intelligence – Custodial Eyes & Ears (Mi6, Mi5, CIA,
    MSS, Mossad, FSB {KGB}, SIS, CSIS, ASIS, DCRI,
    BND etc)
    Power & Control Centres – US Council on Foreign
    Relations, European Council on Foreign Relations,
    Club of Rome, Bilderberg Group, Royal Institute
    for International Affairs, Trilateral Commission etc.
    Main Stream Media – Global Propaganda
    Hollywood – Global Propaganda and epicentre for
    Alternative/Pagan/Kabbalic/Ancient Mystery
    Religious interests.
    The Custodial Network
    Bank for International Settlements – Global
    Banking Computer Network for the movement
    and transfer of Global Currencies (the Back Bone)
    London Bullion Market Association – Physical
    distribution and controlling agency of Gold (real
    wealth)
    Central banking Network – Physical distribution
    and controlling agency of Global Currencies
    (medium of exchange for services, goods and
    labour)
    Organization of the Petroleum Exporting Countries
    – Global distributor and controlling agency of
    Global Oil (consumable real wealth)
    What you must understand is that
    Currencies are merely a medium of
    exchange but Gold is real wealth and Oil is
    consumable real wealth. Oil is a type of
    hybrid between Currencies and Gold, this is
    why Oil States sell Oil in Currency (US
    Dollars) but there is always a payment in
    physical Gold as well. Oil has a usable
    function, Gold has a storable function,
    currency is merely a rate of exchange. You
    can think of Currency in terms of energy,
    Currency isn’t the fuel, Currency is merely
    the calorific value of the fuel being burned.
    By the very nature of both the framework and the
    network, we can have a complete and total
    collapse of the Global Financial System and the
    Custodians don’t lose a single penny as they can
    simple create a brand new system at the click of
    a finger…new Currencies, new Bonds, new Banks,
    new Political systems….new everything….a brand
    new farm! This is because they own the
    machinery to make farms as well as the
    technology to do so.
    People talk about a coming New World Order. If
    you believe what I have written you will see that
    it’s not coming at all, it’s already here, and has
    been here for perhaps 300 years. What they are
    talking about is merely the next cycle within the
    existing NWO…nothing more!
    If you believe this, then for you the truth is
    revealed; that the threat of a coming NWO is a
    False Flag event. It is a deliberate misdirection to
    distract you from the truth hidden in plain view. If
    you believe that a NWO may be coming, then by
    definition, you believe that a NWO cannot
    currently exist. This is precisely what they want
    you to believe. They do not want you to realize
    that the NWO has already been implemented
    incrementally over the past 300 years and
    especially since the propagation of the Global
    Central Banking Cartel whose greatest
    achievements were the Bank of England, the
    United States Federal Reserve System, and the
    Eurozone (including European Central Bank).
    There is of course one thing which they cannot
    create at the click of a finger…Gold!
    When financial systems collapse the wealth
    transfer goes into Gold, which then becomes the
    store of wealth until a new system is put in place,
    then, the wealth transfer goes back into the new
    financial system. So, owning Gold is owning a
    piece of the next financial system, not the current
    financial system…get it? This is when Gold is most
    potent.
    http://
    politicalmetals.files.wordpress.com/2011/09/
    global-reserve-currencies1.png?w=595
    For this reason, every time the financial system
    becomes fragile, every entity always runs to Gold.
    Often they don’t really understand as to why, but
    they do nonetheless.
    The real reason as to importance of Gold is very,
    very simple. Gold doesn’t sit within the Global
    Financial System itself, it sits outside the system
    (outside the Venn Circles), resting on the blank
    white paper which is mostly owned by the Ultra-
    Wealthy. In visible terms it is like the ‘Construct’
    in the movie the Matrix, something which
    underpins the false reality which is created upon
    it.
    To own Gold is to own both a commodity which is
    assigned a Currency value as well as a piece of
    the next framework, a piece of the next network.
    Everything else is which is going on is just noise
    and distractions to the masses….’Bread and
    Circuses’.
    Currently, we are seeing suppression in Gold. I
    believe the reasoning behind this is to buy-time,
    enough time so that the framework and network
    have sufficient Gold reserves to restart the system
    and a long enough period of time so that the Gold
    buying is invisible to the general public, so as to
    avoid a panic or ‘run’. In any case, the next cycle
    is inevitable and it is coming whether we like it or
    not, or whether we are prepared or not.

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  5. John, thanks for the update – much appreciated. What is still unclear after your expansive essay, is what ‘Crash 2’ means in the JW world – or to put it another way: how do we know if ‘Crash 2’ has occurred? Perhaps you could elucidate on this. Do you mean a stock market crash? If so, which bourses and by how much? Do you mean global GDP starts falling? Or do you mean that there are bank runs throughout the Western world? Eller? I’d be very pleased to read your response to this. Many thanks, D

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  6. IP
    It is now against the law in France to suggest a French bank is in trouble…even if it’s true. So much for la liberte.
    Mish at Global Analysis got hit for 25K euros last year.

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  7. Dada
    You’re certainly going to know it’s happened, but whether it will be fiscal, financial, economic, military – or several of them – is impossible to say at the moment.

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  8. How utterly Orwellian, disgusting really. Shame you couldn’t create a phantom blog under a pseudonym that you could write ‘the truth’ on and then link to this in your pieces… ;-) Plausible deniability and all that.

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  9. Interesting. Surely when they have all the gold all they need do is re-value it to say, $100K an ounce, then, Hey Presto all the debt will disappear for it will all be re-payable, assuming they want it re-paid that is….

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  10. DoChen link broken. His contributions, along with Flywheel, Shyster & Flywheel, are firm favourites on ZH.

    If anyone can find a valid link and post it here, you will have done us all a service.

    Thanking you in advance.

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  11. Sorry about the links, that piece has been sitting on my blackberry in a forgotten folder for about a year so links may be out of date, I read John’s piece and then thought I’d dig it out…

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  12. John, nice piece of writing. I saw this event coming back in 2011, I now have no mortgage, no debt. I am stocking my garage with non perishable food items and have been saving regularly which I have planned to withdraw just before the election. I have been trying to paint a picture for my wife to enable her to understand what it will look like but I am having difficulty being able to quantify the damage.

    John can you paint a picture what the UK might look like on the other side. Some collapses can be very quick and others can be a steady drawn out process. Will the NHS be shutdown, will people still get benefits, what will the unemployment rate be. Will we have the army on the street?

    Thank you for your blog

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  13. Where were the safe banks in 2008?
    Tax havens

    The rich don’t like to lose their money.

    The next crash is going to be bigger, but I have this feeling the tax haven banks will escape unscathed.

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  14. Nice post John…….. I think that many of us read your blog because we also see Crash 2 on the horizon. The question is what do you do about it? I do not share your market timing approach and your interest in gold. I am prepared for the stock market it lose half of it’s value. I can live with that outcome because things will undoubtedly become cheaper and this smaller and highly diversified stock portfolio will go further.

    If things become dire and we descend into a Mad Max world then I guess they will be prying a gun out of my old cold hand.

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  15. Don’t see any cash for gold ads on the telly anymore, the booth that used to be at the local shopping centre is long gone.

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  16. Pingback: John Ward – Crash2: The Risk List In Full, And Why The Collapse Is An Eventuality We Cannot Resist – 12 March 2015 | Lucas 2012 Infos

  17. At $1500+ dollars per ounce there was a nice little margin available by buying scrap gold and then selling to larger bulk scrap dealers. The business model was simple, buy the gold from the punters at a %age off the spot price and then make yourself a slice in the middle. Of course with gold prices now highly volatile no one is going to take the chance of buying up scrap when the price volatility might wipe you out…

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  18. Don’t worry be happy , it’s better to be on the Green side, then the Brown side, been hear 67 years it always been like this,

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  19. Debt forgiveness is a seemingly quaint solution for the worlds debt ills. However this only works when A owes B and B owes A. In a daisy chained multiple counter party web of IOUs there is only one one lender and bailer of last resort; dear old govt. And if govt goes/is broke that basically flows down to you and me in the form of socio-economic degradation. Pensions evaporate as the state convulses into one huge depression. Debt forgiveness wont work because everyone is in debt. Those few who arent will get fleeced For everything they have whether they be corporations or individuals. even with the coming depression this debt will take a lifetime to purge from the system. Someone please convince
    me otherwise

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  20. I recommend watching another trusty indicator of a serious downturn and that is the level of stock buybacks by companies. Unless I am mistaken, this particular item was the strongest single identifiable level of buying support for the S&P 500 in 2014 and the pace has not slackened into 2015.

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  21. The biggets risk I see now is that QE is being undertaken by individual central banks : ie Mario has got the Italians ( who need to issue 100s of billions per year to pay the 100 bn €€ annual interest bill they already have on their debt ) , We have bubbles left , right and centre . But Central Banks buying their own debt 40 pct higher than at issue when their debt to GDP ratio is already at 130 pct.. well that just may take the biscuit !! Or should I say Biscotti…….

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  22. Pingback: John Ward – The Bigger Picture : Why The Inane Media-Invented UK Election “Issues” Are Beneath Contempt In The Context Of Deadly Currency Wars – 13 March 2015 | Lucas 2012 Infos

  23. The severity of Crash 1, in stocks which is everyone’s main metric, was mostly the result of the Fed shrinking its balance sheet from mid 07 through Sept 08. This dearth of buying Treasury securities which was then called open market operations and is now called QE, and then all done with very short term paperT bills, and now most all long term notes and mortgage backed securities, starved the Primary Dealers of cash.

    To back up a bit and I know few will believe this but stocks and the stock averages are simply a gauge of excess liquidity in the financial system. When the Fed withdrew this liquidity (in favor of what was thought of as direct aid to stricken financial sectors via what was called the alphabet soup programs) the markets froze up. With Japan and the ECB now ‘printing’ and feeding the same group of global banking giants who are their Primary Dealers it’s feasible that a bear market is not even possible in major stock markets. Then too it’s apparant that central banks and governments show almost no compunction about directly intervening in markets, often via derivative of them. Futures and options that is.

    Point being do not waste a single moment trying to predict the markets based upon so called fundamentals. The economy has nothing to do with stock markets. I know this heresy will find few takers even among the most died in he wool alt economic thinkers.

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  24. Very interesting. But I’m always drawn back to the line by Robert Anton Wilson who said “if you can see “Them” is not Them. I was particularly struck by the idea of who owns the piece of paper. Do you have a sense of what Their ultimate purpose is? It seems that acquiring unimaginable wealth has already been achieved. And what’s the underlying strategy given their level of control of running the system into the ground just to reload it again? I’ve thought for a long time that the only possible interpretation of what governments are doing is to make the planet uninhabitable and destroy as much human life as possible. After all, who needs 7 billion slaves.

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