Bharat Rakshak

Neshant wrote:Back from the grave..

Nice Video and a well documented issue too

John Williams-World Class Crash Coming No Matter What

Good Read

David Stockman : On The Impossibility Of Helicopter Money And Why The Casino Will Crash

Austin wrote:

chanakyaa wrote: What would cause such event/what is the driver?? 2000-dot-com, 2008 and Asian crisis, or 1998 for that matter were caused by different reasons?

I dont remember the earlier crisis but 2008 I do and it was due to sub-prime which had domino effect on banking sector and subsequent bail outs.

They did not fixed the problem of 2008 but simply kicked the can by introducing QE of which 98 % went into Stocks & Bonds.

Any one of the thing can create the next crisis , Bond market collapse , Recession , Stock Market collapse , Chinese Massive Credit Bubble collapsing , EU Banking issues any one can be a trigger ......We are into 90 months since the last collapse and due to cyclical nature of the system and even with healthy systems Financial crises do take place every 7-8 years.

I was just looking at MICEX yesterday and it is at all time high , For a Russian economy which is in recession having a Stock Market at all time high should tell you the Bubble in Stocks are at all time high! Look at Dow that hardly corresponds to health of the US economy , Look at Shanghai Index it at 3000 ! Well one might argue that it was 5000 about year and half back though before it crashed.

QE has provided a unique position to the market where the Real Economy and Stock Market Performance have diverged from each other.

The issue is that most of the Stock Indicies in India and abroad are in multiple of 20 P/E or higher than that. That is Bubble territory. The last crash happened when Fed took the increased the interest rates and kept it there till Lehman went belly up. Further exports have been falling across the board in Asia despite a strong consumer consumption in USA and UK. The way I see it is the following can trigger a recession this year and the coming year.

• PRC Credit or Debt bubble.
• The 2nd dot-com or the social bubble which has spawned the rise of unicorns. Multi Billion dollar valuation but no profits and in some case no revenue either. Example Flipkart. Already the funding is drying up for most of these companies.
• Any blowup in East Asia due to Indo-China Sea, The Senkaku Islands issue or the cross-strait issue

Next year the fallout from Brexit can also be included. Right now the timetable for British withdrawal is looking at 2018-19. This will give sufficient time for industries and financial institutions to move across Channel and into Heart of EU. Once the contours of the divorce is finalised then things will become interesting.

CARL ICAHN FULL INTERVIEW to BLOOMBERG

Christopher Sidor wrote:

Austin wrote:
I dont remember the earlier crisis but 2008 I do and it was due to sub-prime which had domino effect on banking sector and subsequent bail outs.

They did not fixed the problem of 2008 but simply kicked the can by introducing QE of which 98 % went into Stocks & Bonds.

Any one of the thing can create the next crisis , Bond market collapse , Recession , Stock Market collapse , Chinese Massive Credit Bubble collapsing , EU Banking issues any one can be a trigger ......We are into 90 months since the last collapse and due to cyclical nature of the system and even with healthy systems Financial crises do take place every 7-8 years.

I was just looking at MICEX yesterday and it is at all time high , For a Russian economy which is in recession having a Stock Market at all time high should tell you the Bubble in Stocks are at all time high! Look at Dow that hardly corresponds to health of the US economy , Look at Shanghai Index it at 3000 ! Well one might argue that it was 5000 about year and half back though before it crashed.

QE has provided a unique position to the market where the Real Economy and Stock Market Performance have diverged from each other.

The issue is that most of the Stock Indicies in India and abroad are in multiple of 20 P/E or higher than that. That is Bubble territory. The last crash happened when Fed took the increased the interest rates and kept it there till Lehman went belly up. Further exports have been falling across the board in Asia despite a strong consumer consumption in USA and UK. The way I see it is the following can trigger a recession this year and the coming year.

• PRC Credit or Debt bubble.
• The 2nd dot-com or the social bubble which has spawned the rise of unicorns. Multi Billion dollar valuation but no profits and in some case no revenue either. Example Flipkart. Already the funding is drying up for most of these companies.
• Any blowup in East Asia due to Indo-China Sea, The Senkaku Islands issue or the cross-strait issue

Next year the fallout from Brexit can also be included. Right now the timetable for British withdrawal is looking at 2018-19. This will give sufficient time for industries and financial institutions to move across Channel and into Heart of EU. Once the contours of the divorce is finalised then things will become interesting.

I would suggest you read up on David Stockman write up as there is lot of stastics to back it up on what he says

http://davidstockmanscontracorner.com/o ... ill-crash/

Relentless attacks on the Euro (as a "bloc" and "currency") continues....it shows when a retard such as Stiglitz gets FaceTime

Stiglitz Wants ‘Amicable Divorce’ If Euro Area Can’t Reform

Euro and EU itself will not exist sooner or later. Artificial blocks of nations super glued together eventually fall apart.
As this becomes apparent, there will be a mad scramble out of the euro and EU.
The first ones out of the EU like the UK will be beneficiaries of the unfolding chaos.
They will be perceived as the only safe zone in Europe firewalled from the implosion.
The last one remaining in the EU and euro will see much of their wealth evaporate in a flash.
Beware of saving your funds in any European country or European based bank.

Yes, it is a possibility. In fact, I would argue that UK's tactical vote for the population on Brexit was an offensive move to shake up the EU in order to start that "implosion" you are referring to. Hard attempts were made to kick Greece out of EU by all means, but that did not happen. Then came refugee crisis, nothing happened then. And, "Brexit" of course. "They" desperately want one of the EU bloc members to get out/be thrown out etc, by all means possible. And, if/when that happens MSM will be used to cause mass "Scramble" you are referring, which will eventually end the "Euro" currency as we know it. But is not that easy. There is a "deep state" in EU as well. Saying for sure that it is apparent or crisis coming sooner is a strong statement. But, seeing relentless efforts being made to make it happen are real.

I wonder what will happen to those who had advocated having Euro as an alternative to Dollar. The sad truth is that currency is only as strong as the political, economic and military might put behind it. Euro never had the political and military might behind it. The 2008-9 crisis showcased that the economic might behind Euro is questionable. It is being sapped by the self imposed austerity.

To quote Mark Twain "The reports of my death have been greatly exaggerated."

I think Euro will survive for a long time to come , Right now Jap Yen looks in Palliative Care followed by USD in ICU , Atleast one can say with great confidence Gold Looks Stronger as each year of QE and NIRP passes by without major catastrophy

May be in couple if years we will know as Warren Buffett puts it "ONLY WHEN THE TIDE GOES OUT DO YOU DISCOVER WHO'S BEEN SWIMMING NAKED."

“The euro and the ECB were designed in a way that blocks government money creation for any purpose other than to support the banks and bondholders. Their monetary and fiscal straitjacket obliges the eurozone economies to rely on bank creation of credit and debt. The financial sector takes over the role of economic planner, putting its technicians in charge of monetary and fiscal policy without democratic voice or referendums over debt and tax policies.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

Peter Schiff: Carl Icahn telling it like it is.

Theoretical discussion, debate, agreements and disagreements on calculation and use of Gross Domestic Product (GDP) are not new. Unfortunately these numbers are not going up, so it looks like the search is ON to find something that will always go up (I mean measure economic activity correctly )

The Hunt Is On for a New Way to Measure the World's Economies

QE 4 on the Horizon ?

Fed Admits Another $4 Trillion In QE Will Be Needed To Offset An "Economic Shock"

Interview of Ian McAvity from January this year.

https://www.youtube.com/watch?v=_1U1zk1 ... e=youtu.be

Austin wrote:QE 4 on the Horizon ?

Fed Admits Another $4 Trillion In QE Will Be Needed To Offset An "Economic Shock"

Basically, the fed is saying there will not be a shock and the free money will continue to flow. So indulge yourselves, buy risky stocks for they will not come down anytime soon, buy new houses, buy new cars and there will be plenty of jobs for the foreseeable future. Of course there will be inflation too, but only the bottom earners will be worse off while the high earners will be better off in the trade off between growth and inflation.

This is an interesting development. Just like sahukar and indebted farmer stories from old hindi movies, Saudi's are slowing getting trapped by international sahukars.

Saudis Allow Foreign Investors to Armco IPO Shares

Saudi Arabia’s Capital Market Authority (CMA) on 18 August issued new rules allowing foreign investors to buy shares directly in initial public offerings (IPOs).

The change is part of a broader aim to lower Saudi Arabia’s overreliance on oil export revenue and help the government earn billions of dollars by selling some of their state-owned assets. One of these assets is the Saudi Arabian Oil Co., or Aramco, which has an estimated value of around US$2 trillion.

The government expects to earn as much as $100 billion by selling 5 percent of Aramco in an IPO expected to take place in 2017.
...

Well, $100 billion is not much for Saudi to burn, they are also issuing government debt at much much wider yields/spreads because banksters are pushing the spreads wider by buying credit default swaps (CDS). Whether the spreads (i.e. implied risk) should be higher or lower is an important, but a different subject.

Investors Panic-Buy Saudi Default Protection Ahead Of Big Debt Deal

Although, Aramco and Saudi government debt are two different things (due to different ownership), when Saudis get in trouble (i.e. when Yemen war and lower oil prices bankrupts them)...guess how will they repay the government debt....wallah, with their oil related assets, just like our hindi movie farmer looses his land, wife, and children. This may take several years to play out, but the foundations seems to have been in place.

I think its good Saudi are privatizing Aramco , It would bring in effecient management and technology into predominantly government owned company , The key problem of Saudi Economy is Structural and its single pony Oil based Economy , relying on more and more money to pay of saudi citizen to put lid to any dissent.

A great insight into what makes nations grow and prosper and what makes them fail.

Its all linked to individuals being able to own the fruits of their labor without some thief (e.g. govt, bankers, other shysters) expropriating their hard earned wealth.

------

Why Nations Fail | Daron Acemoglu

Federal Reserve Won't Stop Printing Marc Faber

Austin wrote:QE 4 on the Horizon ?

Fed Admits Another $4 Trillion In QE Will Be Needed To Offset An "Economic Shock"

I think what the article is alluding to is the LIBOR and TED spreads are widening. And they are hoping QE will reduce this.

This is a very good video. If anyone is a subscriber of Real Vision TV, there are many more videos there. Do watch one where Grant Williams interview James Grant of Gold interest rate observer.

https://www.youtube.com/watch?v=qnZHMmCjpQ8

Neshant wrote:“The euro and the ECB were designed in a way that blocks government money creation for any purpose other than to support the banks and bondholders. Their monetary and fiscal straitjacket obliges the eurozone economies to rely on bank creation of credit and debt. The financial sector takes over the role of economic planner, putting its technicians in charge of monetary and fiscal policy without democratic voice or referendums over debt and tax policies.”
― Michael Hudson, Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy

If you selectively quote Hudson, you ought to know he stands for a concept called Modern Monetary theory(MMT)

If you hate the neo-Keynesian policies of the current lot, you are going to HATE the MMT.

Hudson, Kelton, Steve Keen were advisors to Bernie. All the 3 are MMTheorists.

This is what they believe in.

The government, when it issues its own currency, and goes into debt in that currency can always pay its debt, can never go broke, can never run out of money. It can afford anything that is for sale in that currency. It doesn’t need to borrow its own currency. And it can set its own interest rate. It does not have to pay what markets want. It does not become a victim to speculation, to bond vigilantes. It has additional policy space. It can do things for its economy and for its people that a government that does not have a sovereign currency cannot do.

Now you see why the honest fool Bernie was promising free this and that.

These chaps are dangerous. And you should keep away from such epic moronery which passes off for educated opinion.

On itunes there are a few podcasts by MMT people. https://itunes.apple.com/us/podcast/kpf ... 21349?mt=2

Listen to them. I almost pulled my hair out listening to this.

nowhere in your message did you refute what Neshant quoted.

I think its good Saudi are privatizing Aramco , It would bring in effecient management and technology into predominantly government owned company , The key problem of Saudi Economy is Structural and its single pony Oil based Economy , relying on more and more money to pay of saudi citizen to put lid to any dissent.

Austin saar, efficiency or maximizing the public good was not the point of my post (i guess you could make that argument about any gov enterprise around the world). Assets are traveling from soon to be distressed owner (and borrower) (made distressed by geopolitical tricks or buy its own doing) to someone who has desire to own world's assets using funny money (and contractual debt). I think we are focusing on the hole, instead lets focus on the donut

panduranghari wrote: If you selectively quote Hudson, you ought to know he stands for a concept called Modern Monetary theory(MMT)

MMT is a lot better than the current system which has private bankers forcing the nation to pay them a perpetual largess for doing nothing. The "hard work" of creating money out of nothing and charging interest on it is surely the biggest ripoff ever invented.

Between paying banksters and paying into the coffers of the nation via MMT, I'd rather pay into the coffers of the nation.

How (wrecklessly) that money in the nation's coffers gets spent is another question altogether. But it surely won't be as wreckless as handing over all that wealth to banksters right from the start - in which case there's nothing to spend wrecklessly because its been stolen right off the bat.

I favor the market deciding the monetary system above all else as that is the only real capitalism and all else is bulls... cronyism & fancy jargon.

But failing that, MMT is way better than banksterism. In the latter case, there is no "maybe" when it comes to theievery/loss of wealth.
Its a certainly.

Canada had a such a system till 1971 or thereabouts. Its central bank was publically owned, unlike the Federal Reserve. They financed their involvement in WWII, major infrastructure projects like the St. Lawrence Seaway, national highways and power plants - all without debt. The system was abolished at the insistence of private banks in the 70s moving the country from a self-funded, non-debt based economy to one that has paid well over a trillion in perpetual interest & debt repayments to private banks since the 70s. Today, over 50% of income is taxed in Canada - this in a country with more oil, gold, iron, diamonds, potash, coal, minerals & gems of all kinds, timber, arable land, fish stocks, water resources..etc. than 95% of countries could ever hope for. Under any other system, people would be receiving a royalty check for the exploitation of their resources, not paying for it. That's banksterism.

Guys what do ya think ?

CNBC : These charts are flashing recession signals

TSJ,
I am not countering Neshant. I am just pointing out that while Hudson might be able to pass a judgement on all the things under the sun, he should be also questioned on his opinions and his theories. And truly MMT is madness.

Neshant,
If current economic policies are banksterism, then MMT is racketeering. TBH both Banksterism and Racketeering are joint at the hip. They are inspired by the ideas of Keynes and Bastiat. Before pronouncing MMT is fine, could you give your critique of MMT?

Read Rothbard or Mises, you wont read about how government can act like god by controlling everything.

Just got it over an email from David Stockman looks like infomercial

We’re going to start our urgent election season trading training at 7pm, EDT. Please set a reminder for yourself.

We’ll broadcast from a secure connection in my home in Aspen, Colorado where I’m researching the 2016 election right now.

You need to hear the warning I’ll be giving you.

In the next few weeks, I believe severe market volatility -- ending ultimately in a 40% stock market crash -- will be triggered by the presidential election.

Spoiler Alert: I think the market is going to be shocked by an “October surprise” soon after this event. I personally saw this same type of shock happen from within Ronald Reagan’s 1980 presidential campaign when I played Jimmy Carter in his debate rehearsals.

The media, Wall Street and investors will be totally blindsided as the stock market swings violently.

But you can profit from the type of market that’s approaching if you understand the fundamentals and have a sense of where things are heading. I think the market is heading for a crash big time -- and very soon. The time to prepare is tomorrow night, during our broadcast at 7pm, EDT.

I feel uniquely positioned to show you where things are going. My decades in Washington D.C. in Congress and the White House… and my subsequent decades on Wall Street… give me unique insight into the crash that’s in store for the market.

Furthermore, I’m going to show you a proven alternative investment strategy during our broadcast that will not only protect your money, but help you to make as much as 510% – no matter if Trump or Hillary wins the election -- if I’m right.

This strategy will show you how to buy specific assets that rise in value when the rest of the market is crashing around you. You’ll need to learn about this method as soon as possible so you’re prepared when the market crash begins.

Moreover, the coming crash is going to fundamentally change the way people invest in the coming years. The same strategy I’ll show you tomorrow night will become the #1 way to make money in the years ahead. It can be used over and over again to profit.

You’ll be able to ask me questions live tomorrow night about it as I lay everything out for you.

Attending will be the most important thing you do all week.

Best,

David A. Stockman
Former Reagan Budget Director and 20 Year

Now ECB is paying companies to raise debt...this fcuked up.

ECB bought 20% of their bond purchases with negative yield [corporate sector purchase programme (CSPP)]

The European Central Bank is desperately trying to revive the region’s moribund economy, at almost any cost. It started buying up corporate bonds in June in hopes of making it easier for companies to borrow and invest; one in five of these bonds (pdf) are guaranteed to lose the ECB money if held to maturity, the bank said today.
.....

The corporate bond market and the ECB’s corporate sector purchase programme

So, instead of giving money directly to the company, investment bank$ter raises debt, which is bought at a higher price that what it is worth (well, worthiness is always in the eyes of the viewer). Everyone is happy. Lots of job creation. Who says it is a Ponzi scheme? Questions is who is ultimately paying for it?

Greenspan Sees U.S. Interest Rates Rising Soon, Perhaps Rapidly

Ex-Fed Chairman says low rates won’t last ’very much longer’
Greenspan also forecasts that euro zone ‘will break down’

Former Federal Reserve Chairman Alan Greenspan forecast that interest rates will begin rising soon, perhaps rapidly.

“I cannot perceive that we can maintain these levels of interest rates for very much longer,” he told former Securities and Exchange Commission Chairman Arthur Levitt in a Bloomberg Radio interview to be aired this weekend and next.

“They have to start to move up and when they do they could move up and surprise us with the degree of rapidity which may occur,” Greenspan added.

The yield on the 10-year Treasury note stood at around 1.55 percent on Thursday, down from 2.27 percent at the start of the year.

Greenspan repeated his previously-voiced concern that the U.S. economy was headed toward a period of stagflation -- stagnant growth coupled with elevated inflation.

For more from Alan Greenspan, listen to A Closer Look With Arthur Levitt

“The very early stages are becoming evident,” with unit labor costs beginning to rise and money supply growth starting to accelerate, he said.

The former Fed chief was pessimistic about the chances of the euro zone surviving in its current form.

Euro Area

“It will break down, as indeed it is showing signs of in many different areas,” he said.

He called the 19-nation currency region “unworkable” because it tries to meld the different cultures and attitudes towards inflation of southern Europe with the north. While a number of inflation-abhorrent countries such as Germany and Austria could form a currency zone on their own, Greenspan said it wasn’t clear what they’d gain economically from doing that.

Nobel laureate Joseph Stiglitz said in a separate interview on Thursday that the euro area should split up if it can’t undertake reforms.

“If they can’t get it together, then an amicable divorce, probably dividing into two or three different currency areas” would be preferable, Stiglitz, an economist and professor at Columbia University, said in a Bloomberg Television interview with Tom Keene and Francine Lacqua.

Levitt, who conducted the interview with Greenspan earlier this week, is a senior adviser to the Promontory Financial Group and a Bloomberg LP board member.

This was podcast last night which I uploaded it , Neshant , Pandu what do you think ?

David Stockman : Election Crash

David Stockman knows how to rant. And if he had written what he spoke, it would have sounded like a rant.

I posted this on twitter gufa

Does more QE make any difference. A thought experiment. At current stage in USA, disability trust fund is bankrupt. Obama borrowed from socialsecurity to cover the shortfall. At present disability trust fund and SS account for 50% of govt expenditure. By 2025, it will account for 100%. At current rate of growth, US debt will rise to 47 trillion $ by 2025. Debt going up 4 times the rate of growth is unsustainable. Between this year and 2025, gotus is going to hit a debt and fiscal wall.

There are only 3 ways out of it- grow your way out(not happening until GOTUS provides miniature fusion reactor in every home in US), devalue the currency i.e. delayed default(cant do it with competitive deval happening in other countries via QE) or pay back the debt i.e. default by paying back in worthless currency ( Bernanke said in 2002 on accepting fed chair that they have the printing press). Only thing that you will see happening is printing.

Hyperinflation is coming to the USA. Hillary will print at least 20 trillion via QE distributed by direct bank transfers or infrastructure spend disguised as fiscal measures. Of course this is just my theory. Time will tell us what happens.

David Stockman believes there will never ever be any hyperinflation. I do not agree. Forecasting is a fools errand anyway.

^^ David says Fed wont go for Negitive Interest Rates and eventually Int rate has to rise sooner than later that would set the ball rolling. He also disagrees strongly with Jim Rickards theory of IMF SDR would take over the role of todays Reserve Currency.

Fed has already factored in next recession and is talking/writing about $2 trillion QE for next recession , So we would see every one printing its way to glory.

Peter Schiff on Janet Yallen Jackson sumit that happened yesterday

Make a Good Read on 3 Part Series on Chinese Ponzi Economy by David Stockman

Red Ponzi Ticking—-China And The Dark Side Of The Global Bubble, Part 1
Red Ponzi Ticking—-China And The Dark Side Of The Global Bubble, Part 2
Red Ponzi Ticking—-China And The Dark Side Of The Global Bubble, Part 3

My take is Schiff, Stockman, Faber etc bet their money on another economic collapse and the fed is thwarting it by endless QE and low interest rates. It doesn't mean they are not right in asking for a rate hike and end to QE. It's just that they bet their money on what is probably the right thing to do but the Fed, Europeans and China are simply not doing the right thing.

Austin wrote:Greenspan Sees U.S. Interest Rates Rising Soon, Perhaps Rapidly

Ex-Fed Chairman says low rates won’t last ’very much longer’
Greenspan also forecasts that euro zone ‘will break down’

Euro Area

“It will break down, as indeed it is showing signs of in many different areas,” he said.

He called the 19-nation currency region “unworkable” because it tries to meld the different cultures and attitudes towards inflation of southern Europe with the north. While a number of inflation-abhorrent countries such as Germany and Austria could form a currency zone on their own, Greenspan said it wasn’t clear what they’d gain economically from doing that.

It is unworkable because euro-zone countries have a monetary union without Fiscal Union and a true blue political union. And in every country/nation there are people who are inflation hawks and together with them exist people who are inflation doves. That does not mean that country breaks up. The complicating factor is that Euro is not the currency of EU.

Nobel laureate Joseph Stiglitz said in a separate interview on Thursday that the euro area should split up if it can’t undertake reforms.

“If they can’t get it together, then an amicable divorce, probably dividing into two or three different currency areas” would be preferable, Stiglitz, an economist and professor at Columbia University, said in a Bloomberg Television interview with Tom Keene and Francine Lacqua.

Levitt, who conducted the interview with Greenspan earlier this week, is a senior adviser to the Promontory Financial Group and a Bloomberg LP board member.

The genesis of Euro was to tie down the unified Germany more closely to Europe. After unification of Germany, a leviathan was reborn in the heart of Europe which with its own currency would have dominated Europe economically and financially. All of its neighbours barring few, incidentally this list included UK and Norway, would have to dance the tune which was set in Berlin. If we break apart the Euro Zone into two or three different currency areas then the main purpose is defeated. Moreover what we are seeing right now in Euro Zone is the weakness inherently in a plain Monetary Union which are remarkably similar to the gold standard. These can be rectified but we need a Visionary leader to arise in Germany for that.

Jim Rogers Explains What He Is Doing Before "The Next Time The World Comes To An End"

http://www.zerohedge.com/news/2016-08-2 ... -comes-end

State-owned China National Chemical Corporation buys Syngenta for $43 billion (Syngenta purchase would be China’s biggest foreign deal ever)

The state-owned China National Chemical Corporation said on Monday that it had received clearance from a regulator in the United States for its $43 billion acquisition of Syngenta, a giant in farm chemicals and seeds.
....
ChemChina agreed to acquire Syngenta in February, about six months after the Swiss company rejected a $47 billion takeover bid by Monsanto.
....