As has been said here oft: It doesn’t matter who wins the election. Dozens, if not hundreds, of poison pills will be left behind in a very paralyzed four years for Trump should he win. In a Hillary win, you could expect an accelerated decline. Economics, as discussed here is but one facet of the multiple fronts about to face impact.
Regardless of who wins the election, one thing is certain: the vote that takes place in December within the confines of the Eccles Building cast by a dozen un-elected, Ivy Leagued, academic bankers whose combined real world business experience is near nonexistent (less for that read in some wood-paneled library) will decide monetary policy that will have more implications for not only the U.S., but the world as a whole. Effecting not only the global financial markets, but quite possibly, the entire international political stratum as well. And the new President (as well as every other world leader) will have to adjust to that outcome.
November 8th is only the first-act of this very real, “landmine” infested global drama playing out on the world stage. On December 14th the world will truly witness just how much power has really been transferred to this unelected cohort.Continue reading →
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 →
FEARS of a financial catastrophe in Europe if Britain votes to leave the union, has prompted the bloc’s top policymakers to plot an emergency Brexit plan of action.
A vote to Leave on June 23 could immediately plunge Europe’s stock markets into meltdown amid fears the union is heading for collapse.
In a bid to stop the chaos, the European Central Bank (ECB) has now decided it would publicly pledge to do “whatever it takes” to prop up markets if and when a Brexit is announced, according to reports. Continue reading →
Money Morning Members should know two things. First: the 2008 financial crisis was caused by a housing bubble, centered in the U.S., that radiated out through the rest of the world and almost destroyed the global financial system.
Second: The next financial crisis – which is starting to unfold as we speak – was caused by a commodities bubble centered in China that radiated out through the rest of the world and will cause enormous financial damage, threatening the global financial system.
Both crises were aided and abetted by central banks printing massive amounts of debt that can never be repaid. That leaves the world with three choices for how to deal with that debt – currency depreciation (which is why you should buy gold), inflation, and default. Continue reading →
Britain’s benchmark index falls into correction territory as US stocks suffer biggest fall since February 2014
The FTSE 100 fell into official correction territory on Thursday, one point shy of January’s year-low hit, after an eighth consecutive day of losses.
Fraught with concerns about slowing growth in China and the after-effects of last week’s devaluation of the yuan, investors fled to the side lines, bringing this week’s losses to 2.5pc. The FTSE 100 closed 35.56 lower at 6,367.89.
‘Deflation, Devaluation, and Default’ loom in China this year. The denouement for Shanghai’s bourse will not be pretty, says the US bank.
China is at mounting risk of a financial crisis this year as growth sputters and deflationary pressures trigger a wave of defaults, Bank of America has warned.
The US lender told clients that a confluence of forces are coming together that threaten to chill the speculative mania on the Shanghai stock exchange and to expose the underlying fragility of China’s $26 trillion edifice of debt.
“A credit crunch is highly probable,” said the bank in a report entitled “Deflation, Devaluation, and Default”, written by David Cui and Tracy Tian.
Bank of International Settlements warns of ‘violent’ market crash
Low levels of market volatility persist despite conflicts and crises across the world
Investors buying assets on the misguided presumption of a level of liquidity
Share prices continue to plummet as investor confidence decreases
A potentially ‘violent’ stock market crash could be on the horizon as financial markets become dangerously stretched, a think-tank has warned.
The Bank of International Settlements said that suspiciously low levels of volatility in the markets seen this year suggest a lack of liquidity that could trip up investors who assume they can dispense of assets when a sell-off begins. Continue reading →
Stocks slumped again on Wednesday pushing S&P 500 losses to almost 8 percent since mid-September. The dollar fell and U.S. bond prices soared after weak Chinese inflation and U.S. producer price and retail sales data fanned fears the world economy could be even weaker than thought.
When stock markets turned south last week after rallying for much of this year, many policymakers initially played that down. In fact, the sell-off could be seen bringing some healthy volatility back to markets that officials worried had become too complacent to risks ranging from tensions surrounding the conflict in Ukraine to the Ebola outbreak.
But the deepening of the sell-off may have put major central banks on their heels, by raising the prospect of the market rout going too far too fast, threatening to hurt confidence and potentially triggering a pullback in spending.
“It reminds me of the massive flight to quality we saw during the (2008) banking crisis, when there were fears that the whole global economy would tip into depression,” said Nick Stamenkovic, a strategist at Edinburgh-based RIA Capital Markets. Continue reading →