Category Archives: Financial

New Recession Starts After Mid-Year [Video]

quarterGreg Hunter – Economist John Williams correctly predicted the first quarter GDP in 2015 would turn negative.  What is his second quarter prediction for GDP?  Williams says, “I am looking for an outright contraction in the second quarter as well.  Two back to back negative quarters in the GDP (Gross Domestic Product) would be counted as a recession.  GDP is very heavily bloated and inflated by all sorts of gimmicks. . . . In effect, we are seeing a weakening of the economy now that is dragging down these bloated numbers.  I contend we never recovered from the collapse in 2008 and 2009.  We have just been bottom bouncing. . . . It is beginning to turn down again. . . . Expectations for the second quarter will begin to sink.”

To back up Williams’ claim of a “sinking” economy, look no further than the Dow Transports which show a clear downtrend.  There are many more signs of trouble as Williams contends, “. . . The better quality numbers show the economy is sinking.  For example, industrial production, published by the Federal Reserve, has contracted dramatically in the first quarter, and it is a virtual certainty to contract in the second quarter. . . . Continue reading

Our Spoiled-Brat Economy

spoiledCharles Hugh Smith – Spoiled brats do not take kindly to being called out as spoiled brats. Since economies are aggregates of individuals, we can anticipate howls of outraged denial at our economy being identified as spoiled rotten.

The two essential characteristics of spoiled brats are 1) a complete disregard for the burdens of those paying the bills and 2) a childishly self-absorbed sense of overweening entitlement. Spoiled brats have no sense of fiscal discipline. Indeed, it is their defining characteristic. They want what they want, and they want it now, regardless of the cost to others or the system as a whole.

In America’s Spoiled Brat Economy, no vested interest is ever allowed to fail. Lost billions gambling with borrowed money? Just throw a K Street temper tantrum and threaten to close all the ATMs when you go broke, and voila, Mommy and Daddy (the federal government and Federal Reserve) come rushing with trillions of dollars to make all the bad things like well-deserved bankruptcy go away.

That tens of millions of savers must be robbed of hundreds of billions of dollars in lost interest to rebuild your banks’ profits and balance sheets–the sacrifices of others are of no concern to spoiled brats.

What does not allowed to fail bring to mind? How about coddled children who are crippled by helicopter parents who do their homework for them and schools that give everybody passing grades and gold stars?

A system that doesn’t allow individuals and enterprises to fail is a system that is simply taking another path to failure. Students who are given gold stars and 9th place ribbons (Meet the Fockers) cannot possibly establish a real sense of accomplishment or learn how to make a realistic assessment of their deficiencies or strengths. They are crippled by all the “help” enablers press on them. Continue reading

The Care And Feeding Of A Financial Black Hole

black holeDmitry Orlov – A while ago I had the pleasure of hearing Sergey Glazyev—economist, politician, member of the Academy of Sciences, adviser to Pres. Putin—say something that very much confirmed my own thinking. He said that anyone who knows mathematics can see that the United States is on the verge of collapse because its debt has gone exponential. These aren’t words that an American or a European politician can utter in public, and perhaps not even whisper to their significant other while lying in bed, because the American eavesdroppers might overhear them, and then the politician in question would get the Dominique Strauss-Kahn treatment (whose illustrious career ended when on a visit to the US he was falsely accused of rape and arrested). And so no European (never mind American) politician can state the obvious, no matter how obvious it is.

The Russians have that pretty well figured out by now. Yes, maintaining a dialogue and cordial directions with the Europeans is important. But it is well understood that the Europeans are just a bunch of American puppets with no will or decision-making authority of their own, so why not talk to the Americans directly? Alas, the Americans too are puppets. The American officials and politicians are definitely puppets, controlled by corporate lobbyists and shady oligarchs. But here’s a shocker: these are also puppets—controlled by the simple imperatives of profitability and wealth preservation, respectively. In fact, it’s puppets all the way down. And what’s at the bottom is a giant, ever-expanding, financial black hole.

Do you like your black hole? If you aren’t sure you like it, then let me ask you some other questions: Do you like the fact that your credit cards still work, or that you can still keep money in the bank and even get cash out of an ATM machine, or that you are either receiving or hope to eventually receive a pension? Do you like the fact that you can get useful things—food, gas, airline tickets—for mere pieces of paper with pictures of dead white men on them?

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Capitalism Has Devolved Into Looting

…when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed.   –  Ayn Rand, “Atlas Shrugged”

There’s no such thing as markets anymore – only interventions.  –  Chris Powell, co-founder and Treasurer of GATA

banksPaul Craig Roberts – Ayn Rand is a pariah among those who believe that government is our benefactor. There are times and conditions when government can be a benefactor of the people. But not in the Western world at the present time. As Michael Hudson and I agree, Western central banks refuse to create money to finance economic recovery. Money is created only for the benefit of the oligarchs’ banks in order that the oligarchs can continue to control the governments.

In the US for the past seven years the Federal Reserve has provided cheap bank reserves for the banks to lend at a markup or to speculate with. Banks are no longer suppliers of capital for productive investments and employment. Instead banks invest in speculation, arbitrage, derivatives, financing corporate takeovers and stock buybacks. The Fed has made it unnecessary for banks to pay for deposits. Instead, the banks get free money and charge consumers with negative interest rates for making deposits. For seven years Americans have, thanks to the utterly corrupt Federal Reserve and US government, been deprived of interest on their savings. In the Western world today, savers are penalized, not rewarded.

In Greece and Europe the banks are the oligarchs’ method of control just as the Federal Reserve is in the US and the Bank of England in the UK and the European Central Bank in the EU. The same in Canada, Australia, and Japan. When an oligarchy controls the money, the oligarchy controls the country, so “Western democracy” is only a pretense. There is no democracy in the West; only manipulated democratic symbols, the manipulation of which has allowed the One Percent to acquire the lion’s share of income and wealth, depriving the economy of the consumer purchasing power necessary to maintain full employment. Continue reading

The Global Template for Collapse: The Enchanting Charms of Cheap, Easy Credit

creditCharles Hugh Smith – According to polls, the majority of Greek citizens want the benefits of membership in the euro/EU and the end of EU-imposed austerity. The idea that these are mutually exclusive doesn’t seem to register.

This is the discreet charm of magical thinking: it promises an escape from the difficulties of hard choices, tough trade-offs, the disruption of vested interests and most painfully, the breakdown of the debt machine that has enabled the distribution of swag to virtually everyone in the system (a torrent to those at the top, a trickle to the majority at the bottom, but swag nonetheless).

If we had to summarize the insidious charm of magical thinking, we might start with the overpowering appeal of using credit to ease all difficulties.

Need money to fund various healthcare/national defense rackets? Borrow the money. Need to keep people employed building ghost cities in the middle of nowhere? Borrow the money. Need to keep buying shares of the company’s stock to push the value of each share ever higher? Borrow the money.

The problem with cheap, easy credit is Cheap, easy credit destroys discipline. The lifetime costs of debt taken on to fund bridges to nowhere, healthcare/national defense rackets, ghost cities, stock buybacks, etc. are never calculated. The opportunity costs are also never calculated.

When credit is costly and hard to get, marginal borrowers can’t get loans and nobody dares borrow at high rates of interest for low-yield, high-risk schemes. When credit is costly and hard to get, what doesn’t pencil out doesn’t get funded.

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“Boots On The Ground” Report From Greece

Simon Black – This letter was written by a Greek-American friend of Simon’s who is currently living near Athens.


withdrawSince my arrival into the country late May, the topic of most discussions I overhear everywhere are naturally about the debt negotiations.

I’d call opinions in support or against the Tsipras governments’ activities pretty sharply divided.

Tsipras supporters are generally fed-up with 5yrs of blood-letting “from the Germans”.

Critics, on the other hand, see the euro as some sort of abstract membership in a club that must be retained at all cost.

A minority even criticize Tsipras for—get this—being too soft.

That’s especially true where I’ve been staying here in the port-city of Piraeus, which – being the country’s biggest port, is home to mostly blue collar, working class folks where unions more or less dominate.

To illustrate the political leanings around here, I hazily recall a headline in a newsfeed summing up their worldview quite accurately: “Piraeus – a neighborhood where Syriza is not quite left-wing enough.”

Enough said. Continue reading

Criminal Bankers And The Military Industrial Complex

lawKatherine Frisk – Looks to me like nothing has changed. The pieces on the chess board have moved slightly, ever so, but basically they are still the same. And the same story line is in play.

Let’s put it all into some perspective. 2,000 years ago we had a dogmatic and corrupt priesthood with a High Temple Priest in the form of Caiaphas. We had a ruling class, a monarchy, the Herodian Kings who killed their own wives and children, were sexually promiscuous, married their own sisters and murdered anyone who was opposed to them. And we had the Legion. The Roman military industrial complex of the time.

What do we have today? We have a dogmatic priesthood with a Papacy that has, over the last 1,000 years burned millions at the stake who refused to bow to their authority. An Inquisition that is still in place and has not been deconstructed. A priesthood finally exposed for child sex abuse that has been endemic for centuries, and a Pope named Benedict who basks in luxury retirement. The Vatican Bank has defrauded the planet of trillions. Yet they call themselves a Church and market themselves as “Christians.”

According to many sources this is where the tax revenues of nations finally end up. Tax revenues are not used for the benefit of the people who pay them, but for the benefit of the “Catholic” (meaning universal) institution that has designated itself as the owner of the planet, all bodies on the planet and all souls.

All roads lead to Rome

According to one recent commentator, the President of the United States takes instruction from the Vatican and in return is given a billion dollar Vatican account, all untraceable of course. The minions are none the wiser.

The money lenders in the Temple who Yeshua whipped – thus sealing his fate on the cross – continue their criminal usury system, turning the world into debt slaves through the Zionist Bankers, the World Bank and the IMF. According to some Goldman Sachs owns the world. Rothschild is said to be the Vatican’s banker and in the catacombs of this audacious structure are buried gold bars and treasure stolen from nations around the world. Continue reading