U.S. Issues New Warning to Europe: End Business With Iran or Face Harsh Sanctions

Iran Foreign minister Mohammad Javad Zarif meets with representatives of the European Union for Foreign Affairs

Iran Foreign minister Mohammad Javad Zarif meets with representatives of the European Union for Foreign Affairs / Getty Images

 

Trump admin, Congress issue warnings that could impact international financial institutions

Congress and the Trump administration are issuing a stern warning to European partners: End all business ties with the Iranian regime or face harsh new sanctions in the coming months, a move that could impact international financial markets and U.S. banks tied to foreign monetary institutions, according to multiple senior U.S. officials who spoke to the Washington Free Beacon about diplomatic efforts to pressure Europe on Iran. Continue reading

“It’ll Be An Avalanche”: Hedge Fund CIO Sets The Day When The Next Crash Begins

While most asset managers have been growing increasingly skeptical and gloomy in recent weeks (despite a few ideological contrarian holdouts), joining the rising chorus of bank analysts including those of Citi, JPM, BofA and Goldman all urging clients to “go to cash”, none have dared to commit the cardinal sin of actually predicting when the next crash will take place.

On Sunday a prominent hedge fund manager, One River Asset Management’s CIO Eric Peters broke with that tradition and dared to “pin a tail on the donkey” of when the next market crash – one which he agrees with us will be driven by a collapse in the global credit impulse – will take place. His prediction: Valentine’s Day 2018. Continue reading

RED ALERT — Get ready for a ‘severe fall’ in the stock market, HSBC says

HSBC’s technical-analysis team has thrown up the ultimate warning signal.

In a note to clients released Wednesday, Murray Gunn, the head of technical analysis for HSBC, said he had become on “RED ALERT” for an imminent sell-off in stocks given the price action over the past few weeks. Continue reading

Deutsche Bank Seeking Alternatives, Reforms to SWIFT

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Duetsche Bank Seeking Alternatives, Reforms to SWIFT A Deutsche Bank logo adorns a wall at the company’s headquarters in Frankfurt, Germany June 9, 2015.

 

Deutsche Bank is calling for a reform of SWIFT, the global financial messaging system which has faced criticism since February’s $81 million heist at Bangladesh Bank.

  • Germany’s flagship lender – which the International Monetary Fund has branded as the world’s systemically most risky bank for its numerous links to other lenders – is one of the biggest users of SWIFT. It is one of the first large banks to publicly urge changes.
  • SWIFT is only as strong as its weakest member, Deutsche Bank’s Chief Information Security Officer Hinrich Voelcker said on Wednesday, adding the bank was in discussions with SWIFT about the consequences of the Bangladesh heist.
  • “If trust in this system breaks down we all have a problem,” he said, without saying which specific reforms he believes are needed.
  • SWIFT is a member-owned cooperative, dominated by large Western banks, including lenders such as Citi , JP Morgan and BNP Paribas , which built the network decades ago.
  • It now connects more than 10,000 different financial firms and industry experts have said all of its users should have to meet a minimum security standard to continue accessing it. Continue reading

Deutsche Bank CEO Warns Of “Fatal Consequences” For Savers

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Deutsche Bank’s war of words with the ECB is not new: it was first unveiled in February when, as we wrote at the time “A Wounded Deutsche Bank Lashed Out At Central Bankers: Stop Easing, You Are Crushing Us.” Europe’s largest bank, with the massive derivatives book, then upped the ante several months later in June, when its chief economist Folkerts-Landau launched a shocking anti-ECB rant in which it warned of social unrest and another Great Depression.

Ironically, these infamous diatribes hurt more than helped: telegraphing to the market just how hurt DB was as a result of the ECB’s monetary policy, the market punished its stock, which has been recently trading within spitting distance of all time lows, in effect making Deutsche Bank’s life even harder as it now has to contend not only with its own internal profitability problems, but also has to maintain a market-facing facade that all is well. So far, it has not worked out very well, prompting numerous comparisons to another infamous bank. Continue reading

Did Citi Just Confiscate $1 Billion In Venezuela Gold

Just over a year ago, cash-strapped Venezuela quietly conducted a little-noticed gold-for-cash swap with Citigroup as part of which Maduro converted part of his nation’s gold reserves into at least $1 billion in cash through a swap with Citibank.

As Reuters reported then, the deal would make more foreign currency available to President Nicolas Maduro’s socialist government as the OPEC nation struggles with soaring consumer prices, chronic shortages and a shrinking economy worsened by low oil prices. Needless to say, the socialist country’s economic situation is orders of magnitude worse now.

According to El Nacional, “the deal was for $1 billion and was struck with Citibank, which is owned by Citigroup.” Continue reading

Bank of England busy preparing for Brexit vote

The Bank of England is consumed with preparing contingency plans for Britain to leave the EU, with staff across its financial stability, monetary policy and regulatory wings ready to calm any turmoil.

In the days leading up to the June 23 poll, the Bank will hold additional auctions of sterling to ensure the banking system has sufficient funds to operate in a potentially chaotic moment.

Three exceptional auctions of cash have already been planned for June 14, 21 and 28. But stuffing the banks full of cash will not prevent foreigners and UK households and companies dumping sterling in the event of a Brexit vote. Continue reading

China’s robot army set to surge

China’s uptake of industrial robots is set to rise rapidly in the coming years as higher labour costs and the heightened aspirations of workers push manufacturers to embrace automation.

The development may add to fears that workers in poorer countries are most in danger of being displaced by automation, with analysis by Citi and the Oxford Martin School, a research and policy unit of the UK university, published earlier this year suggesting that more than 75 per cent of jobs in China are at a “high risk” of computerisation. Continue reading

Top Headlines: Febuary 25th, 2016

Top Intel Officials: U.S. Faces Highest Terror Threat Level Since 9/11 (Washington Free Beacon)

Merging with the Germans: LSE and Deutsche Boerse to create world’s biggest stock exchange (Express)

Citi: Here Comes a Global Recession (Bloomberg)

China accounts for 90 per cent of world’s new billionaires as the number of super-rich swells globally (South China Morning Post)

China’s Silk Road Reaches Iran, Pushes Toward Europe (The Trumpet)

An Escalating War on Cash (Euro Pacific Capital)

Battle over Syria (III) (German Foreign Policy)

Iran accused by Israel of building terror network to strike U.S. and Europe (TruNews)

Russia Deploys to Mediterranean Large Fleet of Stealth Submarines (DEBKAfile)*

Russia reinforces Black Sea Fleet in Crimea with patrol boats and submarines (UNIAN)

EU policy chief warning of ‘hot war’ between Turkey and Russia (TruNews)

Pacific WAR looms as U.S. to steps up patrols near Chinese missile islands (Express)

Inside the Ring: U.S. Mulls Pledge on Disputed Philippines Outpost (Washington Free Beacon)

China ‘Clearly’ Militarizing South China Sea: Pacific Command Chief (DefenseTech)

‘A message to the US’: Chinese missile frigate enters service in East China Sea (South China Morning Post)

China Warns U.S. After Trump Wins Nevada (Money Morning)

Forbes: Putin’s newest satellite state (UNIAN)

*This site requires a paid subscription to view the article. Global Geopolitics benefits in no way.

Citi: World economy seems trapped in ‘death spiral’

Please see the source for the video.

 

“The world appears to be trapped in a circular reference death spiral,” Citi strategists led by Jonathan Stubbs said in a report on Thursday.

“Stronger U.S. dollar, weaker oil/commodity prices, weaker world trade/petrodollar liquidity, weaker EM (and global growth)… and repeat. Ad infinitum, this would lead to Oilmageddon, a ‘significant and synchronized’ global recession and a proper modern-day equity bear market.”

Stubbs said that macro strategists at Citi forecast that the dollar would weaken in 2016 and that oil prices were likely bottoming, potentially providing some light at the end of the tunnel. Continue reading

Watch for U.S. recession, zero interest rates in China next year, Citi says

Lets get one thing straight. The U.S. economy crashed in 2008 and never recovered since. The amount of Americans out of work (95,000,000+) alone prove just that, yet we’re told a second recession is coming. Since we never recovered, this statement essentially means the second wave of the crash is coming. If you’re wondering why the normally-thought-of ensuing chaos hasn’t happened after the crash, it’s because America is in the free-fall phase. Simply put: The chaos doesn’t ensue until impact at the bottom. Those who see the free-fall are making preparations to take cover and those who are blissfully unaware will continue to remain blissfully unaware.

The moral of the story is: If anyone you know or talk to ever asks you when the economy is supposed to crash, tell them 2008.

 

LONDON (Reuters) – The outlook for the global economy next year is darkening, with a U.S. recession and China becoming the first major emerging market to slash interest rates to zero both potential scenarios, according to Citi. Continue reading

Global recession in next two years is ‘most likely’ scenario, says economist

Willem Buiter, chief economist at Citi and former Bank of England policymaker, warns China’s woes are set to spread

A “hard landing” for China is likely to plunge the world economy into recession in the next two years, Willem Buiter, chief global economist at Citigroup and a former Bank of England policymaker, has said.

As the Federal Reserve in Washington prepares to decide whether to defy warnings of economic fragility and push up interest rates next week, a research note by Citi’s experts warns of a 55% probability of global recession. Continue reading

Deutsche Bank Exodus Continues As Real Estate Chief Leaves For Blackstone

Have you ever wondered which big bank after Lehman Brothers would be next to fall? This is why you see so much shuffling from within and people resigning suddenly and going to work for another institution.

Moreover, with over $72 TRILLIONyes trillion, in derivatives exposure — we have likely found it. To put this tiny bit of risk in perspective, the GDP of Germany itself is a mere humble $2.7 trillion.

This is why Germany is also worried in this high stakes game of chicken. If Greece goes, Deutsche Bank who’s heavily invested will go, and creates the possibility of bringing the country with it. From there you can only see how such a scenario would spread to the rest of the world.

 

Earlier this month, Deutsche Bank’s co-CEOs Anshu Jain and Jürgen Fitschen were shown the door (well, technically they resigned, but with shareholder support plummeting amid skepticism about both financial targets and ongoing legal problems, it’s easy to read between the lines). The bank, which has paid out more than $9 billion over the past three years alone to settle legacy litigation, has become something of a poster child for corrupt corporate culture. Consider the following rundown of the legal problems the bank faced as of the beginning of its 2015 fiscal year:

We are currently the subject of regulatory and criminal industry-wide investigations relating to interbank offered rates, as well as civil actions. Due to a number of uncertainties, including those related to the high profile of the matters and other banks’ settlement negotiations, the eventual outcome of these matters is unpredictable, and may materially and adversely affect our results of operations, financial condition and reputation.  Continue reading

Citi Warns “Central Banks’ Grip On The World Economy Is Waning”

While central banks’ grip on the economy seems to be waning, notes Citi’s Matt King, additional liquidity still seems as potent as ever when it comes to propping up global markets. The question in our minds revolves around whether central banks remain willing to keep pumping when the economic benefits are so questionable. Equally, though, valuations are already so elevated that we doubt they can afford to stop. One way or another, this feels like a recipe for increased volatility. Continue reading

Market report: Citi warns of geopolitical tremors

Investors’ “indifference” to the threats “is unlikely to last”, the US bank has warned

On what was the worst day for the FTSE 100 since March, Citigroup sounded an ominous warning for investors.

Geopolitical risks, including the rise of jihadist extremists in the Middle East and simmering tensions between Russia and the West, are “proliferating”, said analysts at the US bank, while investors’ “indifference” to the threats “is unlikely to last”.

Citi’s timing was apt. Geopolitical factors helped to drive the 97.55-point fall to 6,676.08 suffered by London’s benchmark index, with brokers citing the air strikes in Syria by the US and its allies as a reason for the sell-off, as well as the downing of a Syrian fighter jet by Israel.

Continue reading