Forbes attacks self-reliant homesteaders as delusional moochers

Being that Forbes is owned by mostly the Chinese state, it would be fair to say it’s obvious as to why this propaganda piece was even published in the first place.

 

It’s always interesting reading when someone smug and sanctimonious writes a clueless diatribe about another group of people being smug and sanctimonious. So when I saw that an economist for Moody’s and Forbes had written an op-ed calling self-reliant homesteaders “delusional,” I knew I’d be in for some misinformed hilarity.

The article, entitled, “Dear Homesteaders, Self-Reliance Is a Delusion” was published a couple of days ago on the Forbes website. You’ll be forewarned that the article won’t be deep in the first paragraph, when the author presents his claim to knowledge about self-reliant living comes from the fact that he is “a big fan of shows about doomsday preppers, homesteaders, survivalists, generally people who live off the grid.” Continue reading

Pensions Timebomb In America – “National Crisis” Cometh

“This is going to be a national crisis…

“This” being America’s woefully underfunded pension liabilities, according to Karen Friedman. She’s the executive vice president of the Pension Rights Center.

(A place called the Pension Rights Center does in fact exist. We checked.)

MarketWatch columnist Jeff Reeves howls in confirmation that “collapsing pensions will fuel America’s next financial crisis.”

“This is not a distant concern,” warns he, “but a system already in crisis.” Continue reading

Italy Just Bailed Out Another Failed Bank, May Use Pension Funds For Future Bank Rescues

Despite – or perhaps due to – Italy’s failed attempt to slide a state-funded €40 billion recapitalization attempt past Angela Merkel while blaming it on Brexit, and coupled with a bailout proposal to provide €150 billion in liquidity to insolvent banks, overnight we got yet another confirmation that the biggest risk factor for Europe is not Brexit but Italy, where yet another failed bank was bailed out. As the FT reports overnight, Atlante, Italy’s privately backed €5bn bank bailout fund which was created in April to stem the threat of contagion from struggling lenders and whose assets turned out to be woefully inadequate, took control of Veneto Banca after a €1bn capital increase demanded by EU bank regulators attracted zero interest.

This is good news for Veneto Banco and bad news for all other insolvent banks, because the fund, known as Atlas in English, was intended to hold up the sky for Italian banks. Instead it is now practically out of funds, having depleted more than half of its war chest after taking control of Popolare di Vicenza, another regional bank, last month.

Continue reading

China’s Debt Bomb: No One Really Knows The Payload

https://i2.wp.com/2oqz471sa19h3vbwa53m33yj.wpengine.netdna-cdn.com/wp-content/uploads/2016/05/china-debt-bomb.png

Courtesy of: Visual Capitalist

 

No one knows if it’s a hand grenade or a nuclear warhead…

The ramp up in Chinese debt accumulation has been a leading concern of investors for years. The average total debt of emerging market economies is 175% of GDP, and skyrocketing corporate non-financial debt has launched China far beyond that number.

The real question is: by how far? Continue reading

“We Haven’t Seen This Is In Our Lifetimes” – CEO Says “Alberta Is In A Depression”

Toronto’s “Condo King” Brad Lamb tried to put things into context when he said the situation is “worse than 2008.” However, on Friday we received an even more gloomy (albeit realistic) description of the economic situation in Canada’s energy hub, Alberta. In a very blunt interview with BNN, Murray Mullen the CEO of trucking company Mullen Group, said that the situation has moved well past recession, and should be described as a depression. Continue reading

The Coming Default Wave Is Shaping Up to Be Among Most Painful

https://i0.wp.com/assets.bwbx.io/images/i3QJLq_sFdfA/v2/-1x-1.png

 

When the next corporate default wave comes, it could hurt investors more than they expect.

Losses on bonds from defaulted companies are likely to be higher than in previous cycles, because U.S. issuers have more debt relative to their assets, according to Bank of America Corp. strategists. Those high levels of borrowings mean that if a company liquidates, the proceeds have to cover more liabilities.

“We’ve had more corporate debt than ever, and more leverage than ever, which increases the potential for greater pain,” said Edwin Tai, a senior portfolio manager for distressed investments at Newfleet Asset Management. Continue reading

Few fiscal, monetary policy moves left to fight global growth slowdown, Moody’s warns

Risks to global growth have increased since November and world leaders have little left in their fiscal and monetary arsenals to mitigate the threat, Moody’s has warned.

In its quarterly Global Macro Outlook 2016-17 report released Thursday, the ratings agency said that growth prospects were being hammered by China’s slowdown, a slump in commodity prices and tighter financing conditions in some emerging markets.

Continue reading

Moody’s Ponders Credit Downgrades for 120 Energy Companies

Oil prices received a jolt on January 21 and 22, as a cavalcade of bullish news conspired to push oil prices back into the $30s per barrel. The markets got excited at the possibility of more aggressive action from the European Central Bank on Thursday after comments from Mario Draghi, the bank’s president.Also, several voices weighed on oil prices, raising the questions about the unreasonable decline below $30 per barrel. The head of state-owned Saudi Aramco said that oil prices below $30 per barrel was “irrational,” and that he expected prices to rebound this year. Separately, Citigroup said that oil could be “the trade of the year,” because a price increase is nearly assured. After all, prices cannot go much lower, can they? Continue reading

Interest rate rise: turning point looms for US debt binge

With a $4tn mountain of debt maturing over the next five years, corporate America’s reliance on cheap cash is about to get tested.

With the prospect of steadily higher interest rates in the coming years as the Federal Reserve gradually tightens policy, US companies that tapped global markets for inexpensive finance over the past four years will soon face a different environment.

But as rates turn higher, investors may see the flip side of cheap financing. Analysts warn companies will begin defaulting in greater numbers, particularly in the energy sector, which has found itself in the line of fire as commodity prices languish. Continue reading

Yuan devaluation breaks last line of global economic defence, warns top economist

Stephen King of HSBC warns the world’s financial system may not survive another crisis without China as a backstop

China’s devaluation of the yuan reveals that the global economy will be without stabilisers if another crisis strikes, economists have warned.

The decision to cut the yuan’s value showed that Beijing had become scared, they said, suggesting that the world’s second-largest economy is in a far more precarious position than outsiders had assumed.

Stephen King, a senior economic adviser to HSBC, said that since the crisis China had done more than any other to provide “the heavy lifting to support global economic growth”, but that it may not step in to keep the world’s financial system afloat again.

Continue reading

Greece Changes Strategy: No Longer Demands Debt Write Off, Ask For Debt Exchange Instead

Guess who blinked first.

The ECB’s February 28th warning shot across the bow from the Troika, which is fully stacked with Germany’s Fourth Reich, sent a clear message to fall back in line. Apparently the current Communist Greek government wants to hold on to its power and not let the situation descend into utter chaos. What they’re probably waiting on is to see what options they have with their friends in Russia in hopes of throwing them a line.

Up until now, Berlin and Washington looked pretty solid as it overturned and took Ukraine away from Moscow’s sphere of influence. Now Russia struck back and has a piece of the EU.

 

Over a week after the new Greek government came to power, it has presented its first actual proposal of how it hopes to negotiate with Europe that does not involve the infamous “debt write off”, which as both Germany and the ECB have made clear, is a non-starter as it impairs the ECB’s balance sheet and leads to a loss of “faith” in the money printer, the legacy monetary system and so on. So instead of yet another debt restructuring, the FT reports that Yanis Varoufakis “would no longer call for a headline write-off of Greece’s €315bn foreign debt. Rather it would request a “menu of debt swaps” to ease the burden, including two types of new bonds.” Actually he still does, only he is not calling it as such. Continue reading

Russian Central Bank voids Standard & Poor’s, Moody’s, Fitch ratings

What happens when a nation in retaliation refuses to recognize a universally accepted standard ratings agency? Stay tuned. Pandora’s box has been opened on yet another front. Full-blown economic warfare is in full motion.

 

The Central Bank of Russia will no longer use credit ratings from Standard & Poor’s, Fitch, or Moody’s that were assigned after March 1, 2014.

All credit ratings given to Russian companies and banks will now be at the discretion of the Board of Directors of the Bank, according to a press statement Monday. The regulator will assess whether or not the ratings made after March are accurate.

“According to the Bank of Russia Board of Directors’ decision, the rating date for credit institutions and their issued financial instruments, including securities, to implement Bank of Russia regulations, shall be 1 March 2014; as for other entities, listed in the ordinance, and their issued securities, this rating date shall be 1 December 2014,” the press release said. Continue reading

The EU’s Day of Reckoning: Italy Is Too Big to Bail Out

In the end the central theme of most articles reporting on EU events, is that all roads end up leading back to Berlin, the powerhouse of Europe.

And who knows, perhaps Mario Draghi’s upcoming resignation and a possible wish to be the next Italian president is a sign that he wants to go back and save Italy from the wrath that Greece has suffered: Complete capitulation to Germany in exchange to economically stay afloat and keep from descending into social chaos as a result.

Lest we forget what the European Union founders had in mind for the world’s next superpower (See also HERE and HERE), the United States of Europe led by modern day Assyria’s Fourth Reich.

 

Italy is one of the world’s leading tourist destinations. The ruins of the Roman Empire, in particular, the Coliseum, Palatine Hill, the Pantheon and the Forum, are major attractions. New ruins are now being created to mark the political decay at work at the heart of Italy’s democracy and economic policymaking. These new ruins could well include the country’s central bank and parliament as well as the Eurozone as the stage is set for Europe’s next big economic debt crisis.

At the center of the brewing storm is the issue of confidence. When investors trust sovereign debtors, governments have access to credit markets. When investors lose confidence in a country’s ability to pay, they head for the door. The cost of borrowing goes up and at some point it hits a level where it becomes unaffordable to raise money.

Such a loss of confidence afflicted Cyprus, Ireland, Greece and Portugal between 2010 and 2012, shutting them out of public borrowing, creating the European debt crisis and forcing them to seek financial assistance from the European Union, European Central Bank and International Monetary Fund. Italy barely avoided that embarrassment. Continue reading

Ten more countries that may default on debt after Argentina

Ecuador, Egypt, Pakistan, Venezuela, Belize, Cuba, Cyprus, Greece, Jamaica and Ukraine are all on the verge of a default, according to Moody’s ratings.

Argentina defaulted for the second time in 12 years after hopes for a midnight deal with holdout creditors were dashed, setting up stock and bond prices for declines on Thursday and raising chances a recession could worsen this year.

After a long legal battle with hedge funds that rejected Argentina’s debt restructuring following its 2002 default, Latin America’s third-biggest economy failed to strike a deal in time to meet a midnight deadline for a coupon payment on exchange bonds.

Continue reading

Russia and China plan own rating agency to rival western players

Russia and China have agreed to set up a joint rating agency as Moscow’s stand-off with the west over Ukraine has made it more eager to establish institutions that would reduce its dependence on the U.S. and Europe.

“In the beginning, the agency will assess Russian-Chinese investment projects with a view to attracting of [investors from] a number of Asian countries,” Anton Siluanov, Russia’s finance minister, said in Beijing, according to his ministry. “Gradually, based on the progress and authority of such an agency, we believe it will rise to a level where its opinions will attract other countries.” Continue reading