“Financial Crisis” Coming By End Of 2018 – Prepare Urgently

Source: Financial Times

 

“Financial Crisis Of Historic Proportions” Is “Bearing Down On Us”

John Mauldin of Mauldin Economics latest research note, Prepare for Turbulence, is excellent and a must read warning about the coming financial crisis. Mind refreshed from what sounds like a wonderful honeymoon and having had the time to read some books outside his “comfort zone” he has come to the conclusion that we are on the verge of  a “major financial crisis, if not later this year, then by the end of 2018 at the latest.” Continue reading

ARMSTRONG: Major Central Bank May Fail Next Year

Many analysts are fearful of an impending downturn as early as next year. In an exclusive interview with FS Insider, legendary forecaster Martin Armstrong of ArmstrongEconomics.com explained his outlook on the global economy and markets, including a bold call that, as early as next year, “we’re looking at a central bank that can go bankrupt” — a topic that will be the focus of a July conference in Frankfurt.

Armstrong is a unique, contrarian thinker and has made a number of accurate forecasts over the years, especially since we’ve been speaking with him on our podcast. A key theme of his analysis is that economic growth is likely to remain stagnant as nations around the globe struggle with large debt burdens. However, rather than calling for a collapse in the dollar and the US stock market, as many bears have long predicted, Martin has taken the opposite view, focusing instead on the needs of institutional investors to earn yield by increasingly allocating capital into stocks and highly-rated corporate bonds, which helps to fuel the stock market higher. Continue reading

UBS Has Some Very Bad News For The Global Economy

 

At the end of February we first highlighted something extremely troubling for the global “recovery” narrative: according to UBS the global credit impulse – the second derivative of credit growth and arguably the biggest driver behind economic growth and world GDP – had abruptly stalled, as a result of a sudden and unexpected collapse in said impulse. Continue reading

Civil Unrest Engulfing the World

 

Everywhere we turn, politicians are abusing their power relentlessly because the global economy is moving against their best plans. In Paraguay, the nation’s constitution prohibited the re-election of a president since 1992 after a brutal dictatorship of General Alfredo Stroessner’s 35-year hold on power, which made him South America’s most enduring dictator during the cold war. He eventually died in exile in Brazil after he fell from power in 1989. Continue reading

IMF Boosts Growth Forecast for US, Cites Trump Impact

Please see the source for the video.

 

WASHINGTON (AP) — The International Monetary Fund on Monday raised its forecast for the U.S. economy over the next two years, saying President-elect Donald Trump’s policies should boost economic growth, particularly in 2018. But officials warned that if Trump’s protectionist trade proposals set off a trade war, that could be “quite destructive” for the global economy.

The IMF also increased 2017 growth projections for a number of other countries including China, Germany, Japan and Britain, but warned that the global economy faced a number of downside risks from rising protectionism to a jump in interest rates. Continue reading

China Would Outlast U.S. in Trade War, Billion-Dollar Fund Says

China would outlast the U.S. in a trade war, which is a “distinct possibility” next year after President-elect Donald Trump takes office, a commentator wrote in the $1 billion Pine River China Fund’s investor letter.

China’s government would be better placed than the U.S. to marshal state resources to cushion the impact on exporters, wrote James Wang, a City University of Hong Kong professor who pens a monthly commentary for the fund. Privately-owned Chinese exporters would be worse hit than state-controlled peers because they have less political clout in Beijing, he said. Continue reading

Sea Change In The Middle East

America’s view of the Middle East today is shaped by our wars in Iraq and Afghanistan, the rise and reach of ISIS, a grinding conflict in Syria, the region as a source of wider ranging terrorism and staggering outflows of refugees that are changing the political calculus in Europe. The images that characterize and shape American involvement there are of arid landscapes and rubble from wanton destruction, our soldiers and marines in desert camouflage and videos of surgical airstrikes.  However, the image of the beginning of our involvement in the Middle East is a rarely viewed February 1945 photo of President Franklin Roosevelt meeting with Saudi King Abdul Aziz aboard the USS Quincy in the Suez Canal.  As our strategic role in the Middle East began with a meeting on the water so, too, are consequential changes there taking place at sea – the domain in which the U.S. has enjoyed unfettered access and dominance for over seventy years.   Assuming continued uncontested American maritime dominance in that vital region is a grave strategic misstep – key Asian powers have turned to the sea, they understand fully what is at stake, and they have come to play.

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Ireland “Especially Exposed” To “International Shocks” Warns Central Bank

Ireland remains especially exposed to another financial shock because of the extremely high levels of public and private debt, the open nature of the economy, and Brexit, Irish Central Bank Governor Philip Lane has warned in a pre-budget letter to Minister for Finance, Michael Noonan.

“Ireland is especially exposed due to the legacy of high public and private debt levels, the sensitivity of small, highly-open economies to international shocks and Brexit-related vulnerabilities,” Ireland’s Central Bank Governor said.

The letter was covered in the Irish Independent, Irish Times and Irish Examiner. This is something we covered in our interview with Max Keiser last week – see here. Continue reading

IMF Concedes Central Banks Are Doomed

 

The International Monetary Fund (IMF) has warned at the G20 summit in Hangzhou, China, that in the face of crises, the refusal to reform how things are functioning will lead to economic weakness in the global economy. “The latest data show subdued activity, less growth in trade and a very low inflation, suggesting an even weaker global economic growth this year,” the IMF told G20 leaders.

Indeed, we are looking at 2016 coming in as the fifth consecutive year in which global growth will be below the average of 3.7% which prevailed between 1990 and 2007. The IMF said: “Without strong political countermeasures the world could suffer a disappointing growth” for several years to come. Christine Lagarde told world leaders: “Even in the longer term the outlook remains disappointing.” Continue reading

CREDIT CRUNCH TWO? Fears for US economy grow as credit card lending reaches 9-year high

The US economy grew far less than expected in the second quarter of 2016 taking the annualised rate to just 1.2 per cent – below expectations of 2.5 per cent.

At the same time, credit card and overdraft lending has soared to its highest level since 2007. Continue reading

China’s Hundred-Year Strategy

Beijing has a documented plan to be the premier global superpower by 2049. It’s over halfway there. 

Americans think in four-year election cycles. Chinese leaders think in terms of centuries. Just leaf through the glossy, cream-colored, gold-flecked pages of The Governance of China. This anthology of political theories by Chinese President Xi Jinping is considered almost sacred scripture in Beijing.

Across 18 chapters about leading the most populous nation on the planet, Xi outlines his utopian vision for the Chinese people. In the world he describes, the Chinese are heirs to an ancient and unique civilization entitled to a privileged position among nations. In this world, China is an economic, cultural and military superpower, while the United States is no longer a major geopolitical power.

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Warning: New Stock Market Crash Indicators Flashing in China

The International Monetary Fund just issued a dire new warning to China, and it has many fearing a possible stock market crash in 2016.

The IMF warned that growing corporate debt in China is an intensifying problem. They continued saying the debt must be immediately tackled if the Asian nation wants to avoid harming itself and the global economy.

The IMF, an international organization of 189 countries headquartered in Washington, D.C., issued that warning over the weekend. The main goal of the IMF is to promote international financial stability and sustainable economic growth. Continue reading

Opinion: How negative interest rates take money out of your pocket

Negative interest rates, which central banks in several countries have implemented as a way to spur economic growth, is a radical move. In the last of a three-part series, ‘Negative Thinking,’ commentator Satyajit Das examines this policy and its risks.

Low rates are supposed to encourage debt-financed consumption and investment, feeding a virtuous cycle of expansion. They also increase wealth, encouraging spending. Low rates and abundant liquidity should drive inflation.

Instead, these policies since 2008 have brought the global economy a precarious stability at best, and have not created economic growth or inflation. Continue reading

Recession sign is in play and has 81% accuracy

Since corporate profits turned negative in mid-2015, Wall Street has pondered whether it’s just a passing phase or a signal of something worse. History strongly suggests the latter.

Recessions have followed consecutive quarters of earnings declines 81 percent of the time, according to an analysis from JPMorgan Chase strategists, who said they combed through 115 years of records for their findings.

The news gets worse: Of the remaining 19 percent of the time, recession was only avoided through either monetary or fiscal stimulus. With the Federal Reserve holding limited easing options and a deeply dysfunctional Washington thwarting a fiscal boost, the prospects for help are not good. Continue reading

“It’s Worse Than 2008”: CEO Of World’s Largest Shipping Company Delivers Dire Assessment Of Global Economy

Earlier today, we highlighted the rather abysmal results reported by Maersk, the world’s largest shipping company.

The demand for transportation of goods was significantly lower than expected, especially in the emerging markets as well as the Group’s key Europe trades, where the impact was further accelerated by de-stocking of the high inventory levels,” the company said, in its annual report.

Just how bad have things gotten amid the global deflationary supply glut you ask? Continue reading