The Telegraph Fears a Populist Uprising

Brushfyre | James Menendez | February 11, 2016

Allister Heath, deputy Editor for the Telegraph, penned an article in today's Telegraph warning those who ally with globalism that a populist uprising of right-leaning affiliation could be disastrous for the left, the global banks and their ilk.

I literally read each tantalizing word of this article this morning with my mouth agape. I couldn't believe the admissions that one by one were being exposed via the ranting of this globalist. Let's run through them, shall we?

'We' can survive another collapse

From the article:

We are too fragile, fiscally as well as psychologically. Our economies, cultures and polities are still paying a heavy price for the Great Recession; another collapse, especially were it to be accompanied by a fresh banking bailout by the taxpayer, would trigger a cataclysmic, uncontrollable backlash.

The public, whose faith in elites and the private sector was rattled after 2007-09, would simply not wear it. Its anger would be so explosive, so-all encompassing that it would threaten the very survival of free trade, of globalisation and of the market-based economy. There would be calls for wage and price controls, punitive, ultra-progressive taxes, a war on the City and arbitrary jail sentences.

Emphasis mine. By 'We' he means 'them', that is: the globalists. It is extremely apparent in the article that the author does not see himself as one of 'us'. He speaks as if he is talking to his bankster globalist masters, supplicating himself prostrate before them saying 'your way is the best'.

Politicians would become 'Extremist' and 'Populist'

Trump wants to make America Great again.

The fact that Donald Trump and Bernie Sanders both won their respective New Hampshire primaries is certainly one remarkable indication of the state of mind of many US political activists

The key thing here is that the author is not interested in making America great again. He wants the Fed to continue it globalised central bank policy of managing inflation by printing vast sums of cash for the banks (not you). 

More of the Status Quo

More from the article:

History never repeats itself exactly, but the last time a recession was met by pure, unadulterated populism was in the Thirties, when the Americans turned a stock market crash and a series of monetary policy blunders into a depression. President Herbert Hoover signed into law the Smoot-Hawley Tariff Act, dreamt up by two economically illiterate Republican senators, slapping massive taxes on the imports of 20,000 goods and triggering a global trade war. It was perhaps the most economically destructive piece of legislation ever devised, and it took until the Nineties before the damage was finally erased.

Emphasis mine. Let's make sure the banks keep getting their way. He uses the example of the Smoot-Hawley Tariff Act of 1930. This Act of Congress was great for America but really bad for the globalists. The author mentions that this disaster wasn't fixed until the 1990's. What happened in 1990's that would have bolstered globalism and consequently the destruction of American jobs? That's right: NAFTA and GATT. The 'giant sucking sound' Ross Perot warned us about.

If it is not working, why continue failed policies?

The question one has to ask is: why, if the current policies that this author is defending have failed would he continue to argue for the same policies? Make no mistake these policies will lead to the systematic downfall of every country that adopts them. Perhaps then this is the plan: the destruction of every world economy so that one economy can rise above them and take over all the broken countries. A one-world government for instance. That is what globalism is after all, isn't it? One world the central bankers in charge?

Markets Around The World Are Crashing; Gold Soars

Zero Hedge | by Tyler Durden | 02/11/201

Yesterday morning, when musing on the day's key event namely Yellen's congressional testimony, we dismissed the most recent bout of European bank euphoria which we said "will be brief if not validated by concrete actions, because while central banks have the luxury of jawboning, commercial banks are actually burning through funds - rapidly at that - and don't have the luxury of hoping for the best while doing nothing." This morning DB has wiped out all of yesterday's gain.

As for Yellen's testimony, we said that "she can send stocks reeling with one word out of place" - the word in question being not what she said but what she didn't say, in this case not being dovish enough and thus supportive enough of risk. And the consequence is there for all to see as soon as their trading terminal boots up: everything is crashing (with the exception of China which is on holiday, and Japan which was mercifully closed yesterday). Here are the highlights:

• S&P 500 futures down 1.8% to 1814
• Stoxx 600 down 3.4% to 304
• FTSE 100 down 2.6% to 5525
• DAX down 2.9% to 8760
• German 10Yr yield down 7bps to 0.18%
• MSCI Asia Pacific up 0.1% to 117
• Hang Seng down 3.8% to 18546
• S&P/ASX 200 up 1% to 4821
• US 10-yr yield down 5bps to 1.62%
• Dollar Index down 0.42% to 95.49
• WTI Crude futures down 2.9% to $26.65
• Brent Futures down 1.7% to $30.31
• Gold spot up 1.9% to $1,220
• Silver spot up 1.5% to $15.50

It all started in Hong Kong where as we reported last night, the Hang Seng Index plunged 3.9%, catching up with the week’s selloff as the market reopened from a holiday, and capping its worst Lunar New Year start since 1994.

Japan’s Nikkei Stock Average and China’s Shanghai Composite Index were both closed, but investors continued to pile into the yen, as virtually every carry trade has fallen apart in the past month. As a result, the dollar was down 1.8% against the yen at ¥111.28 after sliding below 111 briefly, a massive gain of nearly 300 pips in the past 24 hours, sending the Yen to the lowest level since October 2014 when Kuroda expanded QE.

In the first 9 days of this month, the Yen has risen 985 pips: That is biggest advance, in pip terms, since Oct. 1998; that month, the currency rose 1,563 pips from 130.03 to 114.40 over nine trading days ended Oct. 19. Elsewhere, the euro was up 0.4% against the dollar at $1.1325, its highest since October.

It wasn't just FX: European stocks slid toward their lowest since September 2013 and U.S. futures indicated equities will open nearly 2% and put the recent support level of 1812 in danger of being breached.

Among the key European movers was Societe Generale which tumbled 12% after reporting that quarterly profit missed estimates as earnings at the investment bank fell and it set aside provisions for potential legal costs. Elsewhere, Rio Tinto Group slipped 4.1% as it scrapped its progressive dividend policy and set out new spending cuts.

“Financial markets are repricing for a global growth slowdown,” said Tim Condon, head of Asian research at ING Groep NV in Singapore. "Expectations that monetary policy would be able to do much have diminished considerably.”

Just as troubling is that Swedish shares slid and the OMX Stockholm 30 Index dropped 3.% despite Sweden’s central bank going even deeper into NIRP, cutting its interest rate from -0.35% to -0.5%, lower than the expected -0.45%. The yen leaped to its highest in more than a year. Major sovereign bond markets rallied, pushing U.K. gilt yields to a record low. Gold rose beyond $1,200 an ounce, while U.S. oil traded below $27 a barrel.

This is troubling, because as Bloomberg notes, "signals by central banks from Europe to Japan that additional stimulus is at the ready are failing to ease investor concern that global growth will keep slowing." This means that it is no longer just a joke that central banks are losing credibility: judging by the markets' reaction it is all too real. To this point, yesterday we wondered if Yellen will make bad news good news again. She has failed:

“Over the last few years when we got bad news, equity markets would rally because they would interpret this as potential for central banks to go more dovish,” said Mohit Kumar, head of rates strategy at Credit Agricole SA’s corporate and investment bank unit in London. “Now that correlation is shifting to bad news is actually bad news. Investors are concerned over central banks’ policy options given the market is driven by factors over which they have little or no control over.”

Imagine that: investors investing without a central bank to hold their hand.

Among other things crashing: bond yields - the 10Year plunged to 1.62%, the lowest level since May 2013 as the entire treasury complex prepares for NIRP.

Not everything was crashing however: as central planners lost control, the dull, boring yellow metal known as gold was up about 4% overnight and was trading at $1240 moments ago, well above the level it hit when the Fed ended QE3, and outperforming every asset class in that time period.

Also surging are peripheral European yields, most notably in Portugal and Greece both overf 30 bps wider, as suddenly 7 years of financial dirt kicked under the rug thanks to central bank jawboning and futile actions, re-emerges for all to see, and to be reminded that nothing was ever fixed!

In short, the market is threatening Yellen with a crash ahead of her 2nd testimony today this time before the Senate. We doubt she will comply, so the market will just have to try harder.

Here are the top news from overnight:

• Yellen Suggests Fed May Delay Rate Rises, Not Abandon Them: Fed chair non-committal on possible use of negative rates
• Assessing Yellen’s Warning That Markets Pose a Threat to Economy: Bear markets usually come ~9 months before recessions
• Mylan Slumps, Meda Soars on $7.2 Billion ‘Wealth Destroying’ Bid: Price represents a 92% premium to Meda’s close on Wednesday
• Sanders Raises $7.1 Million After New Hampshire Win: comes after Tuesday’s victory speech declaration that he was “going to hold a fundraiser right here, right now, across America”
• Clinton Reassesses Campaign With Thursday Debate Next Test: New Hampshire margin for Sanders puts Clinton on defensive
• Twitter Troubles Deepen as Lack of User Growth Threatens Sales: Dorsey says making product easier to use is top priority
• Amazon to Repurchase as Much as $5 Billion of Its Own Shares: co. commented in filing yday
• U.K. Bond Yield Drops to Record-Low as Investors Seek Safety: U.K. plans to auction 30-year securities later Thursday
• Swedish Central Bank Unleashes More Stimulus After Krona Warning: Sees scope to cut repo rate further
• ‘Brexit’ Vote Is Clouding U.K.’s Growth Outlook, CBI Says: Business lobby downgrades 2016 growth forecast to 2.3%
• Gold Soars Above $1,200 as Fed Chief Signals Go-Slow on Rates: set for 9th gain in 10 days on Fed chief’s remarks
• Oil Above $55 Is a Long-Term Inevitability, Maersk CEO Says: sees global demand pushing oil price higher over time
• Worst Still Ahead for Mining Industry After Losing $1.4 Trillion: This year looks even worse for an industry decimated by the commodities slump
• SocGen Slumps as Quarterly Profit Hurt by Securities Drop: Bank says ROE target for this year of 10% is ‘unconfirmed’
• As Zika Spreads, an Unexpected Winner in Brazil’s Mosquito War: Scandal-plagued leader Rousseff seeks unity to fight virus

In today's closer look at regional markets, we start in Asia, where equities traded broadly in negative territory amid the soft lead on Wall Street, coupled with the persistent credit risk fears adding to the risk-off sentiment. As such, the iTraxx Asia index ex Japan, an index tracking the value of CDS's in Asia, widened by 6bps to the highest level since Aug'13. The Hang Seng (-3.9%) returned from its elongated break to play catch up with the recent global equity and oil rout, consequently energy names were the notable laggard. While South Korea had also entered the fray as the Kospi (-2.5%) slipped amid the rising geopolitical tensions with North Korea after launching a satellite into space. ASX 200 (+1.0%) bucked the trend with stocks supported by a slew of strong earnings. As a reminder, Japanese markets were closed due to National Foundation Day.

Top Asian News

• Hong Kong Stocks Fall in Worst Start to Lunar New Year Since ’94: Global equity rout deepens during 3-day trading break
• Bass Says China Bank Losses May Top 400% of Subprime Crisis: Hedge fund manager says 10% asset loss would cut equity by $3.5t
• Rio Will Cut Dividend After Metals Rout Sees Profit Tumble: World’s 2nd-biggest mining co. to reduce spending by another $3b
• Billionaire’s Fund Sees India Extending Bear-Market Losses: Hedge fund awaits further 10% drop in values to turn bullish
• SBI’s Profit Growth Slows to Four-Year Low on Bad Loan Surge: Provisions for bad loans almost double in the December quarter
• North Korea to Shut Industrial Park, Freeze South Korean Assets: To expel South Korean personnel from Gaeseong complex

In Europe we have so far seen the most volatile day of what has been a very rocky 2016. Risk off sentiment is extremely apparent across asset class, with equities seeing a significant sell off so far today. Euro Stoxx 50 is lower by around 3.0% this morning, with financials and energy names the most significant underperformers as has been the case throughout the last 6 weeks. Financials have been weighed on by SocGen (-12.4%) who have suffered significantly in the wake of their earnings, while Deutsche Bank's woes have not been forgotten (-5.7%), with the iTraxx Sub Financials index widening this morning by around 36bps, suggesting a rise in financials' CDS. The heightened fear has also seen significant gains in fixed income, with Bunds higher by around 100 ticks so far today, while UK 10-year Gilt yields dropped to a record low this morning.

European Top News

• Glencore Copper Production Falls as Franco to Buy Metals Stream: 4Q zinc production fell 18%, coal declined 17%
• Zurich Insurance Quarterly Loss Misses Estimates on Claims: Company expects to miss its return-on-equity target for year
• Total’s Earnings Beat Estimates on Oil Production, Refining: Co. maintains dividend, offers payout in new stock
• Adidas Sees Higher Profit After 2015 Earnings Beat Estimates: Raises sales, profit outlook for this year
• BG Group Trades Final Time Before Merger: To delist from exchanges on Feb. 15 as Shell takes over; BG’s value has grown ninefold since company’s creation in 1997
• Mediobanca Second-Quarter Profit Declines on One-Time Charges: Fiscal 2Q profit falls 24%
• Nokia Earnings Increase on Cost Focus as Sales Fall Short: Projects 2016 “headwinds” as demand slows
• Publicis Sales Rise on Digital, North American Business: CEO Maurice Levy forecasts ‘modest’ growth this year
• Rio Will Cut Dividend After Metals Rout Sees Profit Tumble: To reduce spending by another $3 billion
• Natixis Buys Stake in U.S. Boutique as CEO Seeks Advisory Growth: To acquire 51% of Peter J. Solomon

In FX, the dominant move as noted above was the USD/JPY sell off, which has impacted on all the major currency pairs. This has contributed to the risk off theme, with stock markets in Europe in the red again and US futures pointing to a 5th consecutive day of losses. From the mid 112.00's, the spot JPY rate was slammed through the 111.00's to print 110.99, with no sign of the MoF or BoJ.
Cross/JPY rates were dragged lower, with EUR/JPY trading through the key 126.00 level, but with limited momentum through here as EUR/USD rallied to new recent highs just above 1.1350. No such tempering in GBP and AUD, though the former JPY rate held 160.00 despite a heavy turnaround in Cable. EUR/GBP posted new highs through .7850. AUD/USD losses through .7000 contributed to sub 80.00 (and 79.00) in AUD/JPY. USD/CAD has tested 1.4000, but holds off the figure as yet.

WTI and Brent crude futures have ticked lower in European trade with WTI Mar'16 futures notably breaking below the USD 27.00 level, near 12 year lows despite the headline figure released in yesterday's DoE inventories showing a surprise drawdown . However, some analysts have noted that Cushing OK crude inventories showed a surprise build, and the market is ready to pounce on any signs that the glut is expanding.

Gold has benefited from safe haven bids in Asian and European trade and is over USD 25.00/oz higher on the session, at its highest level since May 2015. The World Gold Council have noted that the upward trend in gold looks set to continue as buying by central banks and Chinese investors will bolster prices. Analysts have noted that the following year could see a surge of M&A activity, as gold miners have plenty of liquidity with surging gold prices and diversified miners look to offload assets, due to softness in industrial metals.

Turning to the day ahead, we get the latest weekly initial jobless claims data due in the US. The focus will again be on Fed Chair Yellen when she is due to speak in front of the Senate at 10am. Her prepared remarks will mirror what she said yesterday so the focus will be on the Q&A: for the sake of the market she better be much more dovish.

Bulletin Headline Summary from Bloomberg and RanSquawk

• Today has seen the most volatile day of what has been a very rocky 2016, risk off sentiment is extremely apparent across asset class
• The FX markets have been dominated by the USD/JPY sell off, which has impacted on all the major currency pairs
• Looking ahead: highlights include: Fed's Yellen appear before Senate, weekly jobs data and earnings from PepsiCo
• Treasuries higher in overnight trading as European equity markets plunge, WIT oil drops below $27 a barrel; Treasury to sell $15b U.S. 30Y notes, WI 2.465% vs 2.905% in January, lowest 30Y auction stop since 2.880% in August 2015.
• Financial markets are signaling that investors have lost faith in policy makers’ ability to support the global economy. European stocks slid toward their lowest since September 2013 and U.S. futures indicated equities will open lower
• Sweden’s central bank lowered its key interest rate even further below zero to -0.5% and said it’s prepared to use its full toolbox of measures as it battles to revive inflation and keep the krona from appreciating
• European banks and insurers’ subordinated credit risk rose to the highest since March 2013 after disappointing earnings at Societe Generale and Zurich Insurance Group renewed concerns about financial companies’ profits; Societe Generale, France’s second-largest bank by market value, posted fourth-quarter profit that missed analysts’ estimates as earnings at the investment bank dropped and it set aside provisions for potential legal costs. The shares plunged
• With populist and anti-EU forces surging across the region, should David Cameron leave next week’s European Union summit with a deal to overhaul the terms of Britain’s membership, many of his counterparts will dig out their own wishlists
• Kyle Bass, the hedge fund manager who successfully bet against mortgages during the subprime crisis, said China’s banking system may see losses of more than four times those suffered by U.S. banks during the last crisis
• The world is so awash with crude, the boss of BP Plc said people will be filling their “swimming pools” with it by the end of the year
• Sovereign 10Y bond yields mostly lower, Greece (+31bp), Portugal (+31bp) higher; European stocks plunge, Asian markets mostly closed for holiday, Hang Seng drops; U.S. equity-index futures fall. Crude oil drops, copper, gold rise

US Event Calendar

• 8:30am: Initial Jobless Claims, Feb. 6., est. 280k (prior 285k); Continuing Claims, Jan. 30, est. 2.245m (prior 2.255m)
• 8:45am: Bloomberg Feb. United States Economic Survey
• 9:45am: Bloomberg Consumer Comfort, Feb. 7 (prior 44.2)
• 1:00pm: U.S. to sell $15b 30Y bonds

• Central Banks
• 10:00am: Fed’s Yellen testifies to Senate committee
• 5:30pm: Reserve Bank of Australia’s Stevens testifies in Parliament

DB's Jim Reid concludes the overnight wrap

Looking at the latest in Asia this morning, markets in Korea and Hong Kong are open for the first time this week, although are largely playing catch up with the big falls that we’ve seen for risk assets in that time. The Hang Seng is currently down a steep -4.03% while the Kospi has dropped -2.97%. Mainland China exchanges are still closed although the Hang Seng China Enterprises Index (HSCEI) is down nearly 5%. Markets in Japan are closed for a public holiday. There’s better news in Australia where the ASX is currently +0.95%, although the Aus iTraxx index is 4bps wider as we go to print. US equity market futures are weaker while Gold has surged above $1,200.

Moving on. As we highlighted at the top, yesterday saw the 2s10s Treasury yield curve go below 100bps for first time since December 2007. After spiking as high as 1.772% in early trading, the benchmark 10y yield tumbled into the close, eventually finishing over 5bps lower on the day at 1.668% and just off the 12-month lows. 2y yields finished unchanged at 0.686% meaning the spread of 98bps is the lowest since the 6th December 2007. This is one of our favourite lead indicators of the business and default cycle and the flattening that has occurred in recent years is one of the reasons we think credit conditions have been tightening for a few quarters now and why our default models have been showing a continued pick-up in defaults into 2017-2018. To be fair the last four recessions have not started until the yield curve (2s10s) has inverted. We're still some way off that but the fact that we're at the flattest for over 8 years is a warning sign.

There was finally some good news to report for European equity markets yesterday as the Stoxx 600 (+1.87%) benefited from a financials-led (Banks +4.42%) rebound to close up for the first time this month. Having been heavily hit in recent days the IBEX (+2.73%) and FTSE MIB (+5.03%) finally got some much needed relief. European credit indices also had a better day although did finish well off their tights. The iTraxx senior and sub-financials indices ended up 5bps and 13bps tighter respectively which helped Main in particular close nearly 2.5bps tighter, although the index had been closer to 8bps tighter pre-Yellen.

Staying with credit, our US credit strategists published their latest note earlier this week (Chickens Come Home to Roost, 8 Feb 2016) wherein they construct a proprietary dataset to forecast expected US default rates. The team uses index transition data to capture all forms of default – bankruptcies, out-of-court restructurings and distressed exchanges – to build a robust market-based dataset that is more detailed, precise and timely than that available from ratings agencies. The most striking revelation of the data is that DM HY commodity names appear to already be in a full cycle, with issuer-weighted default rates at 15.9% (14.9% par).

Assuming that commodity defaults rise to 20% for the year ahead and that ex-commodity defaults hold steady at 4% as they forecast, the overall default rate for DM USD HY (Commodity weight: ~20%) would hit 7.2% - magnitudes higher than the 1.85% default rate seen last year! Rising credit pressures across a spectrum of non-commodity industries and downward pressure on recovery rates in energy bonds should only serve to further compound already apparent risks.

Wrapping up, yesterday’s economic data was focused on what was a pretty soft set of industrial production reports in Europe. Data for France (-1.6% mom vs. +0.3% expected), Italy (-0.7% mom vs. +0.3% expected) and the UK (-1.1% mom vs. -0.1% expected) all missed relative to expectations, while manufacturing reports for France and the UK were also soft for the month of December.

Turning to the day ahead, there’s not alot for us to report with no economic data of note due out in Europe and just the latest weekly initial jobless claims data due in the US this afternoon. Instead the focus will again be on Fed Chair Yellen when she is due to speak in front of the Senate at 3pm GMT. Her prepared remarks could mirror what she said yesterday so the focus will be on the Q&A. Away from this we’ll also get the Riksbank’s latest monetary policy announcement where current economist expectations are for another cut in the main policy rate deeper into negative territory (10bps cut to -0.45%). Earnings wise today we have 20 S&P 500 companies set to report including AIG and PepsiCo.

Deutsche Bank Stock Crashes To Record Low

Zero Hedge | February 9, 2016

Deutsche Bank's stock is crashing and signs point to the same issues that caused Lehman Brother's to crash in 2008 which was the beginning of the 2008 financial collapse in the US. 

Greek stock market falls sharply on banking sector meltdown

Yahoo News | February 8, 2016

Athens (AFP) - Bank shares crashed on the Athens stock exchange Monday, losing a fifth of their value within hours, as the government was seen facing an impossible choice between further austerity and social unrest.

Related Stories

Skirmishes in Athens as general strike sweeps Greece AFP
Greek police turn to teargas as tempers flare over pensions Reuters
Greek professionals stage 'necktie protest' over pensions AFP
Thousands of Greek farmers protest against pension reform AFP
Protests, EU demands add pressure on Greece's Tsipras Associated Press
$70/Month Is Too Much For Auto Insurance Sponsored 

The FTSEB index of financial stocks was down over 20 percent in midday trading, helping pull the overall market index more than 7 percent lower.

The Athens stock exchange had already lost 8.89 percent of its value last week, with the banking index taking a beating with a drop of 24.3 percent.

The main banks had gained a little ground after receiving a recapitalisation boost in December, six months after a disastrous tug-of-war between the leftist government of Prime Minister Alexis Tsipras and Greece's EU-IMF creditors forced the imposition of capital controls and nearly wiped out the value of their shares.

Greece last week wrapped the first phase of a fiscal review by its EU-IMF international creditors, with no agreement in sight on a controversial pension reform that has caused a social backlash against Tsipras' fragile coalition.

German business daily Handelsblatt over the weekend cited a source close to the talks saying that "Greece was doing a lot on paper" but less on the application front.

Leftist daily Avgi, which is close to the government, on Sunday said there were "many and significant" difficulties in reaching an agreement on Greece's fiscal targets for 2017 and 2018.

These include a gap of 800 million euros ($872 million) and disagreements over how to handle the mountain of bad loans weighing down Greek banks.

Protests are mounting against Tsipras's government -- which aims to slash maximum pensions -- with a general strike held last week and farmers intermittently blocking national highways and border crossings for the past three weeks.

The prime minister has a majority of just 153 deputies in the 300-seat parliament with which to secure passage of the pension bill later this month.

Ron Paul: Ted Cruz is no libertarian

Politico | By ELIZA COLLINS | 02/05/16 12:13 PM EST

Ron Paul seemed more attracted to the views of Vermont Sen. Bernie Sanders. | AP Photo

Now that Rand Paul is out of the race for the White House his father Ron Paul, who ran in 2008 and 2012, isn't impressed by Ted Cruz's attempts to pick up the "free market" libertarian banner.

“You take a guy like Cruz, people are liking the Cruz — they think he’s for the free market, and [in reality] he’s owned by Goldman Sachs. I mean, he and Hillary have more in common than we would have with either Cruz or Trump or any of them so I just don’t think there is much picking,” Paul said of the Texas senator on Fox Business’ “Varney & Company" on Friday.

Surprisingly, the elder Paul seemed more attracted to the views of Vermont Sen. Bernie Sanders, who is giving Hillary Clinton a run for her money in the Democratic primary.

“On occasion, Bernie comes up with libertarian views when he talks about taking away the cronyism on Wall Street, so in essence he’s right, and occasionally he voted against war,” the former Texas congressman said when asked if there was a candidate who was truly for the free market.

"It's hard to find anybody -- since Rand is out of it -- anybody that would take a libertarian position, hardcore libertarian position on privacy, on the war issue and on economic policy," Paul added.

“So I always say: You can search for a long time, but you’re not gonna find anybody in the Republican or Democratic primary that even comes slightly close to ever being able to claim themselves a libertarian,” he concluded.

Citi: World economy trapped in ‘death spiral’

NBC | Katy Barnato | February 5, 2016

Ivan Bliznetsov | Getty Images

The global economy seems trapped in a "death spiral" that could lead to further weakness in oil prices, recession and a serious equity bear market, Citi strategists have warned.

Some analysts — including those at Citi — have turned bearish on the world economy this year, following an equity rout in January and weaker economic data out of China and the U.S.

"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.

"The death spiral is in nobody's interest. Rational behavior, most likely, will prevail," he said in the report.

Crude oil prices have tumbled by around 70 percent since the middle of 2014, during which time the U.S. dollar has risen by around 20 percent against a basket of currencies.

The world economy grew by 3.1 percent in 2015 and is projected to accelerate to expand by 3.4 percent in 2016 and 3.6 percent in 2017, according to the International Monetary Fund. The forecast reflects expectations of gradual improvement in countries currently in economic distress, notably Brazil, Russia and some in the Middle East.

By contrast, Citi forecasts the world economy will grow by only 2.7 percent in 2016 having cut its outlook last month.

Overall, advanced economies are mostly making a modest recovery, while many emerging market and developing economies are under strain from the rebalancing of the Chinese economy, lower commodity prices and capital outflows.

Stubbs added that policymakers would likely attempt to "regain credibility" in the coming weeks and months.

"This is fundamental to avoiding a proper/full global recession and dangerous disorder across financial markets. The stakes are high, perhaps higher than they have ever been in the post-World War II era," he said.

Just 151,000 new jobs were created in January in the U.S., in the latest sign that the world's biggest economy is slowing. Economists are concerned about an industrial or manufacturing recession in the country, following some warnings from companies in earnings seasons and recent weak manufacturing activity and durable goods orders data.

However, some analysts say markets are overegging the prospect of a global slump.

"Many markets are now pricing in a significant probability of recession and when we talk about recession, we're talking particularly about a U.S. recession. Do you think that is likely or not? To me, the odds are too high; the market is pricing too high a probability," Myles Bradshaw, the head of global aggregate fixed income at Amundi, told CNBC this week.

Obama Urges Congress to Approve TPP ‘This Year’; Leading Presidential Candidates Oppose It

CNS News | By Patrick Goodenough | February 4, 2016 | 4:17 AM EST

After trade ministers from the U.S. and 11 other countries on either side of the Pacific on Thursday signed one of the biggest trade deals in history, President Obama called on Republicans and Democrats to approve it “this year.”

Obama said in a statement he would “continue working with Democrats and Republicans in Congress to enact it [the Trans-Pacific Partnership] into law as soon as possible so our economy can immediately start benefiting from the tens of billions of dollars in new export opportunities.”

“We should get TPP done this year and give more American workers the shot at success they deserve and help more American businesses compete and win around the world,” he said.

Obama clearly has the November election in mind: Leading candidates in both parties oppose the TPP while the deal has supporters and critics on both sides of the aisle in Congress.

America’s 11 partners in the TPP, which has been under negotiation for five years, are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. All 12 countries must now ratify it.

At the signing ceremony in Auckland, New Zealand, U.S. Trade Representative Michael Froman expressed confidence that Congress would approve the deal.

“We are working with members of Congress, working with the leadership of Congress, educating everybody as to what’s in the agreement, addressing their questions and concerns,” he said.

“And I’m confident that at the end of the day, because of the strong benefits to the U.S. economy – which have been estimated to be over $130 billion a year in GDP growth, as well as more than $350 billion in additional exports – that members of Congress will see the benefits for their constituents and we’ll have the necessary bipartisan support to be approved,” Froman said.


Democratic primary frontrunner Hillary Clinton moved from backing the TPP while secretary of state – saying in 2012 that it set “the gold standard in trade agreements” – to rejecting it last July.

Her socialist opponent, Sen. Bernie Sanders of Vermont, pledged last October to “lead the effort to defeat” the TPP.

Republican frontrunner Donald Trump has called the TPP “a horrible deal,”charging during a Fox Business Network debate last November that it was “designed for China to come in, as they always do, through the back door and totally take advantage of everyone.”

(Sen. Rand Paul accused Trump of mistakenly saying China was a TPP member although Trump did not exactly do so; TPP critics have warned that China may later join the original 12 members. Nonetheless, Politifact ratedTrump’s statement untrue.)

Among the other GOP candidates, former Florida Gov. Jeb Bush has been most supportive of the trade deal.

Sen. Marco Rubio of Florida voted last June in favor of Trade Promotion Authority (TPA), giving the president “fast track” authority to negotiate agreements like the TPP. Later in the year he declared himself “generally very much in favor of free trade” but said he would need to understand the details of the TPP “before we can commit to voting for something. But generally, it’s very positive.”

Sen. Ted Cruz of Texas voted against the TPA. After not taking a position in favor or against the TPP for months, he said in Iowa in November that he would vote against the trade pact.

Among others in the GOP pack, the TPP has the support of neurosurgeonBen Carson (“with reservations”) and of Ohio Gov. John Kasich, who has called it “critical.”

Former Hewlett-Packard CEO Carly Fiorina last June voiced skepticism about the TPP, and also cited concerns that China could join later.

New Jersey Gov. Chris Christie is on the record as saying he generally believes in free trade but that he has “real concerns about this president’s ability to negotiate anything that represents a great deal for America.”

Wells Fargo Insider Says Bank Is Preparing For Emergency Scenario

Investment Watch | by Sean Adl-Tabatabai | February 4, 2016

A Wells Fargo bank insider, who claims to be a teller, has said that the bank are training their staff to deal with an imminent “emergency scenario”.

The insider reports:

I am a teller at Wells Fargo here in the US this is also my first time using this proxy.

They started training us today for a bank holiday. They didnt mention the word bank holiday, but they did train us for an “emergency scenario”. They told us it’s just a drill. Ive been working here for 3 years, and we never had a drill before..

They said that during an emergency, they would close the doors and only allow 3 people at a time inside of the branch. Also, my branch manager said that we would have armed guards during the emergency.

The last thing they mentioned is that they wont store alot of cash in the vault, since it will be a safety issue….

just wanted to share this with you guys.

Superstation95.com reports:

A call by SuperStation95 to Wells Fargo Corporate Headquarters in San Francisco to verify these claims was met with a terse “no comment.”

Interpretation

If taken at face value and believed, why would Wells Fargo be doing this? What “emergency” could take place that might cause people to swarm to a bank in such numbers that they would have to lock the bank and only allow three customers in at a time?

A bank collapse? An economic collapse? a Currency collapse?

None of these things would be good and if the claims above are true, it is a dangerous signal to the rest of us to get some money out to tie-us-over for a month or so in the event everything shuts down.

In a banking emergency, CREDIT AND DEBIT CARDS WILL NOT WORK. ATM’s will not work. Banks will be closed so that you cannot even enter your own safe deposit box.

Do you have enough cash money on-hand to get through for a couple weeks operating solely on cash? If not, you’d better get that taken care of — fast.

We’re not even talking about making payments on your debts during that time, but rather only using the cash to get food, fuel and such to live! Could you make-it for a month without access to any financial tools or bank cash?

Do you have spare food in the house if stores stop taking credit cards- or the cards don’t work? How will you eat if everything remains cash-only for a month?

These are legitimate questions you should be asking yourself right now. Time may be very short. An economic collapse would take place with lightning speed and by the time you realize what’s happening, people will already be storming the banks and supermarkets trying to stock-up. Waiting until it actually happens is waiting too long; you’ll be too late.

A word to the wise: Prepare.

The Secretive Hedge Fund That's Generating Huge Profits for Yale

Bloomberg | By Sabrina Willmer & Tom Moroney | February 4, 2016 — 5:00 AM EST

Yale University. IMAGE CREDIT: Flickr

In a year when titans Bill Ackman and David Einhorn each lost more than 20 percent for their investors, David Swensen’s bet on a little-known hedge fund kept making him money.

Nancy Zimmerman’s Bracebridge Capital has gone from $5.8 billion in assets four years ago to $10.3 billion today with a return of about 10 percent a year since its inception. That makes it the largest hedge fund in the world run by a woman. Zimmerman, who survived a 1990s scandal involving Russia, her husband and Harvard University, is so successful at avoiding the limelight that Leda Braga’s $9.5 billion Systematica Investments Ltd. is often cited as the top woman-led firm by assets.

David Swensen 
Photographer: Peter Foley/Bloomberg

Swensen, who runs Yale University’s $25.6 billion endowment, and Thomas Steyer of Farallon Capital Management originally staked Zimmerman in 1994 with about $50 million. Yale’s investment now is valued at around $1 billion, making it one of the endowment’s most profitable.


“She’s employing this leveraged strategy to exploit pricing differentials in the fixed-income world with an obsessive focus on risk,” Swensen said in an interview.

Bracebridge has had only eight losing months since 2009. The fund’s 2 percent gain last year eclipsed the industry, which was up 0.6 percent on average, according to data compiled by Bloomberg. Hedge funds had trouble navigating unexpected market events, including a devaluation in the Chinese currency in August, a rally in European government bonds and a steep drop in oil prices.

Ackman’s Pershing Square Holdings, the publicly traded part of his activist hedge fund, lost 20.5 percent last year, hurt in part by a drop in the shares of drugmaker Valeant Pharmaceuticals International Inc. Einhorn’s Greenlight Capital suffered the second losing year in its history, with its main fund falling 20.4 percent due to wrong-way stock picks.

“There were a lot of gopher holes that you could step in,” said Gabriel Sunshine, Zimmerman’s partner at Bracebridge. “We managed to miss most of them.’’

Heavyweight Network

Zimmerman, 52, has a powerful network of allies, including former New Jersey Governor Jon Corzine, who was Zimmerman’s boss at Goldman Sachs Group Inc., where he was co-chief executive officer. Among her top investors is Princeton University’s endowment, run by Swensen protege Andrew Golden.

Corzine said he remembers Zimmerman as a brilliant trader who attracted the brightest of co-workers.

Bracebridge is a relative-value fixed-income fund that exploits small pricing differences in the credit market and hedges against those bets.

Zimmerman offered a typical scenario: Bracebridge buys a corporate bond it considers cheap while at the same time purchasing a credit-default swap on the bond in order to make money even if the company goes bankrupt. Leverage boosts returns.

The strategy hasn’t always come up roses. Long-Term Capital Management, a highly leveraged hedge fund run by John Meriwether, pursued a similar investment approach. In 1998, after Russia stiffed lenders including LTCM, the fund failed and was bailed out by its Wall Street competitors. The demise of LTCM hit other hedge funds, including Bracebridge, which held some of the same assets. Bracebridge lost about 26 percent, making it the worst year in its history.
Russian Economy

A few years prior, in 1992, Zimmerman’s husband, Harvard economist Andrei Shleifer, signed on to help privatize the Russian economy under the auspices of the university and the U.S. government. Zimmerman bought up beleaguered Russian debt, betting its value would rise, court filings show.

Complaints arose about Shleifer and his business partner allegedly using their position and influence for personal gain, according to court documents. Harvard, Shleifer and the U.S. Justice Department eventually reached an agreement in which the university paid $26.5 million to settle a civil lawsuit and Shleifer paid $2 million. Zimmerman’s company paid $1.5 million to resolve civil claims that it improperly used resources and staff from the government-funded project.

Neither Zimmerman nor her husband admitted wrongdoing in connection with their Russia dealings.

Zimmerman was born and raised just north of Chicago in Skokie, Illinois, the youngest of two girls. While attending Brown University in Providence, Rhode Island, she worked summers at O’Connor & Associates, a Chicago derivatives-trading firm. She stayed with them for three years after graduation, on the raucous floor of the Chicago Mercantile Exchange. Her first job was buying Japanese yen options, she said.

She stands a few inches over five feet with brown hair that she sometimes tucks behind her ears. Though her roots are in the Midwest, she’s a Bostonian now, relishing Red Sox games and working behind the scenes for a number of the city’s philanthropies.

Zimmerman downplays the challenges faced by women in a male-dominated industry: “The bonds don’t know who owns them.”
Cashed Out

Initially, Zimmerman and Sunshine partnered with Steyer’s Farallon, which bought a minority stake in the new management company they called Farallon Fixed Income Associates. They had one employee.

Steyer cashed out after the Russia episode, but Swensen stuck with Bracebridge. “We took a hard look and found no reason to modify our relationship,” said Swensen, who describes himself as a close friend of Zimmerman’s.

After cutting ties with Farallon and changing its name, Bracebridge ended 1999 with $600 million under management.

Bracebridge’s biggest turnaround came in 2009. After losing 18 percent in the global financial crisis, it posted a 35 percent gain. That surpassed the 25.8 percent return on the HFRI Relative Value index.

Zimmerman owns most of Bracebridge, according to a 2015 filing with the U.S. Securities and Exchange Commission. As for the value, the document only says she and Sunshine control 12.6 percent of the assets. Of the $10.3 billion, that’s about $1.3 billion. It’s split between her and Sunshine and their partners, Zimmerman said, declining to be more specific.

Zimmerman credited her more than 100 employees for the firm’s success. “I’m very proud of the people who come to work here,” she said. “They are focused, intellectually honest and they love to collaborate.”

RETAIL APOCALYPSE: 2016 BRINGS EMPTY SHELVES AND STORE CLOSINGS ALL ACROSS AMERICA

Michael Snyder | End Of The American Dream - FEBRUARY 1, 2016

IMAGE CREDITS: TWITTER, EZLEEINFAMOUS.

Major retailers in the United States are shutting down hundreds of stores, and shoppers are reporting alarmingly bare shelves in many retail locations that are still open all over the country.

It appears that the retail apocalypse that made so many headlines in 2015 has gone to an entirely new level as we enter 2016. As economic activityslows down and Internet retailers capture more of the market, brick and mortar retailers are cutting their losses. This is especially true in areas that are on the lower portion of the income scale. In impoverished urban centers all over the nation, it is not uncommon to find entire malls that have now been completely abandoned. It has been estimated that there is about a billion square feet of retail space sitting empty in this country, and this crisis is only going to get worse as the retail apocalypse accelerates.

We always get a wave of store closings after the holiday shopping season, but this year has been particularly active. The following are just a few of the big retailers that have already made major announcements…

-Wal-Mart is closing 269 stores, including 154 inside the United States.

-K-Mart is closing down more than two dozen stores over the next several months.

-J.C. Penney will be permanently shutting down 47 more stores after closing a total of 40 stores in 2015.

-Macy’s has decided that it needs to shutter 36 stores and lay offapproximately 2,500 employees.

-The Gap is in the process of closing 175 stores in North America.

-Aeropostale is in the process of closing 84 stores all across America.

-Finish Line has announced that 150 stores will be shutting down over the next few years.

-Sears has shut down about 600 stores over the past year or so, but sales at the stores that remain open continue to fall precipitously.

But these store closings are only part of the story.

All over the country, shoppers are noticing bare shelves and alarmingly low inventory levels. This is happening even at the largest and most prominent retailers.

I want to share with you an excerpt from a recent article by Jeremiah Johnson. The anecdotes that he shares definitely set off alarm bells with me. Read them for yourself and see what you think…

*****

I came across two excellent comments upon Steve Quayle’s website that bear reading, as these are two people with experience in retail marketing, inventory, ordering, and purchases. Take a look at these:

#1 (From DJ, January 24, 2016)

“Steve-
[Regarding the] alerts about the current state of the RR industry. This is in line with what I’ve been noticing as I visited our local/regional grocery store, Walmart, and Target this week in WI. I worked in big box retail for 20 years specializing in Inventory Management. These stores are all using computerized inventory management systems that monitor and automatically replenish inventory when levels/shelf stock get low. This prevents “out of stocks” and lost sales. These companies rely on the ability to replenish inventory quickly from regional warehouses.
As I shopped this week and looked at inventory levels I was shocked. There were numerous (above and beyond acceptable levels) out of stocks across category lines at all three retailers. And even where inventory was on the shelf, the overall levels were noticeably reduced. Based on my experience, working for two of these three organizations in store management, they have drastically/intentionally reduced their inventory levels. This is either due to financial stresses/poor sales effecting their ability to acquire new inventory, or it could be the result of what was mentioned earlier regarding the transporting of goods to these regional warehouses. Either way this doesn’t bode well for the what’s to come. Stock up now while you can!”

#2 (From a Commenter following up #1 who didn’t provide a name, January 26, 2016)

“I’d like to tailgate on the SQ Alert “based on my experience…” regarding stock levels in big box stores. This weekend we were in two such stores, each in fairly isolated communities which are easily the communities’ best source for acquiring grocery items in quantity.
I myself worked in retail (meat) for thirty years so I know exactly what a well-stocked store looks like, understand the key categories and category drivers, and how shelves are stocked and displays are built to drive sales and profits. I also understand supply chain and distribution methodologies quite well.
Each of the stores we were in were woefully under-stocked.This time of year-the few weeks following the holidays-is usually big business in groceries and low stock levels suggest either poor ordering at the store level, poor purchasing at the distribution level or a purposeful desire to be under-stocked.

Anyone familiar with the retail grocery industry is also familiar with how highly touted “the big box store’s” infrastructure is. They know exactly when demand is high and for what items and in what quantities. It is very unlikely that both stores somehow got “surprised” by unusually high demand. It is reasonable then to imagine that low stock levels in rural areas with few options is a purposed endeavor to assure that both the budget conscious and the folks in more remote areas are not fully able to load up their pantries.

Simply put I believe the major retailer in question is doing their part to limit the ability of rural America to be sufficiently prepared. Nevertheless, we are wise to do our best to keep ahead of the curve. God bless your efforts, Steve.”

*****

Yes, this is just anecdotal evidence, but it lines up perfectly with hard numbers that I have been discussing on The Economic Collapse Blog.

Exports are plummeting all over the globe, and the Baltic Dry Index just plunged to another new all-time record low. The amount of stuff being shipped around by air, truck and rail inside this country has been dropping significantly, and this tells us that real economic activity is really slowing down.

If you currently work in the retail industry, your job is not secure, and you may want to start evaluating your options.

We have entered the initial phases of a major economic downturn, and it is going to be especially cruel to those on the low end of the income spectrum. Do what you can to get prepared now, because the economy is not going to be getting better any time soon.

INSIDER: IT DOESN’T MATTER ABOUT TRUMP, “HILLARY WILL WIN”

Infowars | Paul Joseph Watson | JANUARY 26, 2016

Highly influential CEO Martin Sorrell suggests that the outcome of the 2016 presidential election has already been decided, remarking, “It doesn’t matter who the Republicans put up…Hillary will win.”

Sorrell’s comment, reported by the DC Whispers website, raises eyebrows given his position as head of, “The single most influential and prominent marketing firm in the world with decades-old ties to the most elite of the elite.”

Sorrell, who is the Chief Executive Officer of WPP PLC (Wire and Plastic Products), has a net worth of over $150 million dollars and is described as having “huge clout” in the world of advertising. “Sorrell’s opinions have huge weight,” reported the Guardian in a 2008 profile.

As DC Whispers highlights, his ties to Fox News, which at times has been antagonistic towards Donald Trump, are also extremely noteworthy.

“WPP and its myriad of affiliates, represents up to HALF of all Fox News ad revenue. WPP’s clients include such corporate giants as Ford, Glaxo Smith, IBM, Microsoft, Nestle, Walmart, Unilever, etc. – clients who in turn represent tens of millions of dollars in monthly ad revenue that keep the lights of Fox News on and pays the salaries of on-air personalities like Megyn Kelly,” reports the website.

“So when someone like Martin Sorrell signals it doesn’t matter who the Republicans nominate because Hillary Clinton is going to be the next President of the United States regardless, it is a prediction/threat that should be taken very seriously.”

As Mac Slavo points out, “Trump has not only been bucking the establishment, as well as contentious Fox News host Megyn Kelly – but he has also taken on some of the very advertisers that Sorrell represents, and Fox News depends on for their operations.”

Sorrell’s comments are in line with similar sentiments expressed by globalists at the recent Davos confab. Sorrell is married to Cristiana Falcone, director of media and entertainment industries at the World Economic Forum.

According to a Reuters report, financial elitists are “alarmed” at the prospect of Trump being the Republican nominee, although they still expect his campaign to falter.

Harvard University’s Niall Ferguson told Reuters that Trump’s chances “could be over before Super Tuesday,” and that populists never win the presidency, but that the public is “mad as hell” and this is what’s driving the Trump phenomenon.

Ferguson was even more candid in comments he made to Bloomberg, asserting, “I think there’s going to be a wonderful catharsis, I’m really looking forward to it: Trump’s humiliation. Bring it on.”

According to columnist Ann Coulter, that “humiliation” could come in the form of a “fake scandal” that breaks right before the Iowa caucus.

As we previously reported, the powerful Bilderberg Group, which counts Ferguson and Sorrell as two of its regular attendees, backed Hillary to become president at its annual confab in June last year.

DAVOS DEPRESSION: SOROS PREDICTS DEVASTATING DEFLATION, REPEAT OF 2008

The Dollar Vigilante | JANUARY 23, 2016 | JEFF BERWICK 

In Davos, billionaires plot ways to consolidate power under one government, but in Acapulco Mexico, late in February, we will meet together to discuss how to create seven billion separate governments!

That’s what anarchy is all about, the ability of each individual to be in charge of his or her own life without predetermined restraints. If you injure someone or damage something, you’re responsible. Otherwise, society has no claims on you, certainly none enforced by the power of the state. There is no state ….

That’s much different than Davos where hundreds of seriously wealthy control freaks are meeting together to figure out how to promote global government that will have a claim on each and every one of us. Don’t do what they tell you to do and you are fined, jailed or worse. That’s “civilization” – Davos style.

When they are not gathered together in fancy restaurants quaffing expensive wines and eating fine food, the old men (mostly men) of Davos are “brainstorming” new ways to confuse and frighten us.

The idea is that we are to be afflicted with worse and worse disasters and as a result, convinced to turn to them – the Davos conclave – for salvation and hope.

And this is surely the reason for Davos attendee and billionaire George Soros’s pronouncements regarding the world economy, which made news recently for the extent of their alarmism.

Soros and another Davos attendee, William White are warning we are on the cusp of collapse. You’d think they just discovered yesterday that bad things were about to happen.

Earlier this week we wrote about White, the former chief economist of the Bank for International Settlements, who labeled 2016 a debt Jubilee year and basically predicted the shattering of the world economy. You can read what we wrote here.

Now comes billionaire Soros claiming that “the world is running into something it doesn’t know how to handle.” His statements hit the wires around the world and resulted in a BusinessInsider post profiling Soros’ “bearishness” with some choice quotes.

“We are repeating [2008],” Soros said during the World Economic Forum in Davos, Switzerland, in an interview with Bloomberg TV. The root cause of the crisis is different this time, however. In 2008, it was the subprime crisis in America. This time, it is China and the deflationary forces it is transmitting to the rest of the world.
There’s the same old bogeyman that they like to roll out. This time it is “China,” which we have recently explained is not the culprit for this coming mess… and “deflationary forces”.

They purposefully try to confuse people with inflation/deflation. They want people to think the symptoms of inflation (rising prices) is inflation itself… and it happens inexplicably! Inflation is the increase in the money supply (aka. money printing). This causes prices to rise. But the root-problem isn’t rising prices; the root-problem is the increase in the money supply by the central banks.

And, it’s the same for deflation. When markets are blown up to bubble-like levels by money printing and then begin to fall, they call that “deflation” and say that is the problem. It’s not. The problem is that the increase in the money supply will eventually create a bubble, which will eventually collapse.

But you will NEVER hear that from the old men muttering to each other in Davos. They don’t want you to know that THEIR actions create the market crashes that they are now grimly warning us about.

He goes on to add in another red herring, oil!

The issue is that China’s problems are being passed on to the rest of the world. “It’s one of the sources of deflation,” Soros said. “You’ve got basically three major root causes. One is China, the other is oil and raw material prices, and the third is competitive devaluation,” he added. “You have all three.”

As we also explained earlier this week, the price of energy getting cheaper could not possibly destroy an economy. How could it?

At Davos, they want to point the blame at everyone but the true culprit: themselves. They are the true financial terrorists. And what is the answer they will present to save the world? You guessed it, print more money!

European stocks rebounded this week after the European Central Bank essentially said that is what they would do. And, next week, the Federal Reserve meets to decide on how to manipulate the price of money (interest). If they also become “dovish” – which is a funny word to describe manipulating interest rates lower and counterfeiting money – we could see a short-term rebound in the markets… but it won’t last.

This system is in collapse, and quite likely a planned collapse, to cause worldwide chaos in order for the elites to garner more power and control as a dumbed down and impoverished populace (dumbed down by government public education and impoverished by governments and central banks) clamor for someone to do something.

The truth of the matter is that the people of the world need to wake-up to this con game and stop supporting governments and central banks and move their assets into gold, silver and bitcoin.

At Anarchapulco and its sister conference. the TDV Internationalization and Investment Summit, we’ll be discussing these issues. We won’t waste our time with scare tactics and how to figure out ways to rule the world. We’ll discuss ways to DEFEND ourselves from the tactics being plotted at Davos and elsewhere.

We’ll write about what we discover in our TDV newsletter (subscribe today here) and we’ll try to spread the word through videos and radio interviews.

The path for humanity is clear… and it won’t be long until enough people figure out what is going on and rid the world of these heinous governments and central banks. But, most people will likely go through the pain of the collapse before they recognize the problem.

We plan to be one step ahead of them and not only recognize the problem but protect our assets and profit from the collapse.

Call Anarchapulco the “Anti-Davos” Conference.


Anarcho-Capitalist. Libertarian. Freedom fighter against mankind’s two biggest enemies, the State and the Central Banks. Jeff Berwick is the founder of The Dollar Vigilante, CEO of TDV Media & Services and host of the popular video podcast, Anarchast. Jeff is a prominent speaker at many of the world’s freedom, investment and gold conferences including his own,Anarchapulco, as well as regularly in the media including CNBC, CNN and Fox Business.

Markets Are In The "Eye Of The Storm", Trader Warns

Zero Hedge | by Tyler Durden on 01/25/2016 07:39



Traders on the NYSE clapped and cheered when the closing bell sounded on Friday as though a couple of green closes somehow made up for the outright chaos that’s reigned throughout the month.

Oil may technically have entered a new “bull” market and the yuan may have momentarily stabilized, but a quick look at the fundamentals for crude and the backdrop for the global economy suggests any respite will be fleeting.

Echoing that sentiment is FX trader Mark Cudmore who is out this morning warning that while the blizzard of 2016 may have come and gone, markets are likely just in the “eye of the storm.”

* * *

From Mark Cudmore, writing for Bloomberg

While the worst of the U.S.’s epic winter blizzard has officially passed, it’s less likely that the storm in financial markets can also be said to have ended.
Thursday’s rally continued strongly into the weekend close, resulting in most global assets recording a positive week. But once analyzed in the broader context, it seems likely this may only be a bear-market bounce
Bear-markets often provide the most extreme moves in both directions because lower risk-appetite reduces liquidity on both sides of the market. Also, technicals gain supremacy over fundamentals which loosens anchors to “value” and encourages out-sized reactions to any changes in sentiment
Technically, there is little out there for bulls to cling to. While oil may now officially be in a “bull” market after its biggest two-day rally in seven years, it is still down 12% year-to-date and firmly in a medium-term downtrend. That applies even more clearly to other important commodities, such as copper
Likewise, across longer-term charts for stock markets, emerging-market currencies and high-yield credit, the recent bounce is barely noticeable. And the risk-barometer that is EUR/JPY closed below the critical 200-week moving average for a second straight week
Fundamentals didn’t drive this year’s weakness, so it will be harder for positive fundamentals to prompt a recovery’’
Perhaps the two most significant supports for the market have been that the Chinese yuan stabilized and the European Central Bank indicated that further monetary easing is imminent. But both of these are arguably reactions to negatives rather than genuinely new positive drivers
The relief rally probably has more to run but it’s hard to believe the worst of 2016 is behind us. And there are even reports that Storm Jonas may crop up again in a couple of days – on the other side of the Atlantic

* * *

As a reminder, this is still the 2nd worst start to a year ever...

The Last 16 Times This Happened There Was A Recession…

The Economic Collapse Blog | By Michael Snyder | January 19th, 2016

Something has just happened that has signaled a recession every single time that it has occurred since World War I. 16 times since 1919 there have been at least 8 month-over-month declines in industrial production during the preceding 12 month period, and in each of those 16 instances the U.S. economy has plunged into recession. Now that it has happened again, will the U.S. economy beat the odds and avoid a major economic downturn? I certainly wouldn’t count on it. As I have written about repeatedly, there are a whole host of other numbers that are screaming that a new recession is here, and global financial markets are crumbling. It would take a miracle of epic proportions to pull us out of this tailspin, and yet there are many people out there that are absolutely convinced that it will happen.

John Hussman is not one of them. In his most recent weekly comment, he examined this stunning correlation between month-over-month declines in industrial production and recessions. To me, what Hussman has presented is overwhelmingly conclusive…

Last week, following a long period of poor internals and weakening order surplus, we observed fresh declines in industrial production and retail sales. Industrial production has now also declined on a year-over-year basis. The weakness we presently observe is strongly associated with recession. The chart below (h/t Jeff Wilson) plots the cumulative number of month-over-month declines in Industrial Production during the preceding 12-month period, in data since 1919. Recessions are shaded. The current total of 10 (of a possible 12) month-over-month declines in Industrial Production has never been observed except in the context of a U.S. recession. Historically, as Dick Van Patten would say, eight is enough.

After looking at that chart, is there anyone out there that still doubts that the U.S. economy is in significant trouble?

Many estimates of U.S. GDP growth for the fourth quarter of 2015 are already just a small fraction of one percent. It would not be a surprise at all to see a negative number posted once it is all said and done.

And of course more bad news for the economy just keeps pouring in. So far this week we have learned that the growth rate of federal withholding taxes has turned negative, Johnson & Johnson plans has announced that it is eliminating3,000 jobs, and BP has announced that it is eliminating 4,000 jobs.

Of course it is not exactly a surprise that BP is cutting jobs. At this point the entire energy industry is absolutely hemorrhaging workers. As I wrote about yesterday, 130,000 good paying energy jobs have been lost in the United States since the beginning of last year.

But now we are seeing major firms outside the energy industry cutting payrolls. Even financial giants such as Morgan Stanley are looking for ways to cut costs…

Morgan Stanley just announced fourth-quarter earnings, and it is providing detail to investors on a cost-saving plan called Project Streamline.

During a conference call, CEO James Gorman uttered a sentence that will most likely make the bank’s staff shudder.

“Too many employees based in high-cost centers are doing work that can sensibly be done in lower-cost centers,” he said.

The whole environment is changing.

When things start to get tough, big corporations start to get rid of people. We saw this back in 2008, and it is starting to happen again right now.

And just like last time around, we are going to see millions of Americans lose their jobs during the hard years that are ahead of us.

But thankfully for the moment there is a brief lull in the action. The financial turmoil that has gripped the planet was calmed on Tuesday when China announced that their economy grew at a rate of 6.8 percent during the fourth quarter of 2015. This was right in line with expectations, and markets around the world responded positively to the news.

There is just one huge problem. Everyone knows that GDP figures coming out of China are essentially meaningless. If you believe that the Chinese economy actually grew at a 6.8 percent rate during the fourth quarter of 2015, then I have a bridge to sell you. Virtually every other number coming out of China over the past several months tells us that the Chinese economy is shrinking, and so that 6.8 percent figure is extremely questionable at best.

Do you want to know the last time the communist Chinese admitted to having a recession?

It was in 1976.

Over the past four decades, economic growth figures have become a source of great national pride for China. To admit that the economy is now imploding would bring great shame on the Chinese government and the nation as a whole, and so that must be avoided at all costs.

Yes, the numbers are fraudulent in the U.S. too. According to John Williams of shadowstats.com, if the U.S. was actually using honest numbers the last recessionnever would have technically ended.

But in China they take this to ridiculous extremes. The Chinese economy is fueled by exports, and Chinese exports have been down on a year over year basis for six months in a row. And the primary reason why commodity prices have been absolutely collapsing is because of the economic contraction in China.

Of course if China had released a GDP number that was honest, global markets would have crashed hard. So their lies are making everyone else feel a bit better for the moment, and every day of relative stability that we can enjoy from here on out is something to be thankful for.

As you read this article, markets all over Asia, Europe, South America and the Middle East are already in bear market territory. More than 30 percent of the market has been wiped out in Brazil and Hong Kong, more than 40 percent of the market has been wiped out in China and Italy, and about 50 percent of the market has been wiped out in Saudi Arabia.

We are already experiencing a major global financial crisis.

The only question remaining is how bad it will eventually become.

Let us hope for more days like this one that are relatively calm. But I wouldn’t count on things turning around significantly any time soon, because the economic fundamentals are telling us that big trouble is ahead.

Goldman Sachs sends US into recession, promptly retracts report’s slide

RT | 22 Jan, 2016 09:47

© Brendan McDermid / Reuters

Despite being “too big to fail”, America’s “most important bank” Goldman Sachs may have done so this week, at least for a few minutes, when it possibly tipped off a new economic recession.

A slide in the “Markets do not ‘Take it Easy’ to start the year” report posted online showed the US in a recession according to Goldman’s Current Activity Indicator.

“Although EM assets remain in the cross-hairs – and the outlook there remains tenuous in spots – g

rowth concerns have impacted the market’s view of US and European growth as well, pushing our market-based measure of US growth risk to new post GFC lows (see Exhibit 8),” the report read.


Shortly after the financial watchdog website Zero Hedge tweeted their response, Goldman Sachs posted an altered slide, moving the dark blue line from zero to closer to two.

So if Goldman Sachs changed the chart, there’s no recession, right?

Well, that’s where we get into a gray area.

Economist Paul Samuelson once said “the stock market has predicted nine out of the last five recessions”, according to the Washington Post, which asked “Is the stock market telling us we’re headed for a recession?” on Wednesday.

Andrew Levin, a Dartmouth professor and former adviser to Federal Reserve Chair Janet Yellen, pointed out in this document posted Monday that the “jobs boom doesn't look like it will last” and “industrial production is falling as fast as it does when there's historically been a recession”, according to the Washington Post.

Art Cashin, Director of Floor Operations at UBS, told CNBC Tuesday: "If corporations start to pull back and say 'I don't want to advance anything; I don't want to hire anybody,' we could slide into a recession."

Former Treasury Secretary Larry Summers, who’s been spinning through the revolving door between Washington and Wall Street since the Clinton administration, wrote in the Financial Times earlier this month that “markets understood the gravity of the 2008 crisis well before the Federal Reserve” and cited a report by The Economist which found the International Monetary Fund (IMF) failed to recognize any of the 220 recessions in major countries in the April before the recession started.

Last week, portfolio strategist Michael Pento wrote in his CNBC commentary ominously titled “A recession worse than 2008 is coming”: “The unscrupulous individuals that dominate financial institutions and governments seldom predict a down-tick on Wall Street, so don't expect them to warn of the impending global recession and market mayhem. But a recession has occurred in the US about every five years, on average, since the end of WWII; and it has been seven years since the last one - we are overdue.”

Goldman Sachs has long been criticized, but rarely punished, for its role in the global financial crash, aka GFC.

As portrayed in the new Oscar-nominated film “The Big Short,” the $40 billion company sold investments they knew to be "crap" and "junk," and took out insurance policies against them.

“Investment banks such as Goldman Sachs were not simply market-makers, they were self-interested promoters of risky and complicated financial schemes that helped trigger the crisis”, Michigan Democrat Carl Levin from the Senate Permanent Subcommittee on Investigations said.

Despite multiple revelations published by the Subcommittee, the Obama administration announced it was ending the investigation into Goldman Sachs for its manipulation of the sub-prime mortgage market in 2012.

Ironically, Republican presidential candidate and Texas Senator Ted Cruz loves nothing more than telling Republicans how Obama brought the country to its knees, failing to mention that his wife is a managing director for Goldman Sachs and regional head of the bank’s Houston office.

The government has been able to squeeze a few bob out of Goldman Sachs. Last week, it settled a joint lawsuit for $5 billion, specifically for Goldman Sachs’ role in selling mortgage-backed securities between 2005 and 2007.

It reached a $1.2 billion settlement with the Federal Housing Finance Agency in 2014 and in 2010, Goldman Sachs paid $550 million to the Securities Exchange Commission.

In all cases, the settlements allowed them to avoid prosecution or jail time.