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The world economic order is collapsing and this time there seems no way out
The world economic order is collapsing and this time there seems no way out Europe has seen nothing like this for 70 years – the visible expression of a world where order is collapsing. The millions of refugees fleeing from ceaseless Middle Eastern war and barbarism are voting with their feet, despairing of their futures. The catalyst […]
Why Are The IMF, The UN, The BIS And Citibank All Warning That An Economic Crisis Could Be Imminent?
Why Are The IMF, The UN, The BIS And Citibank All Warning That An Economic Crisis Could Be Imminent? The warnings are getting louder. Is anybody listening? For months, I have been documenting on my website how the global financial system is absolutely primed for a crisis, and now some of the most important financial institutions in […]
Chapter 5: Economists and the Banking System, Part 2: Adam Smith, Some Early Americans, and Friedrich List
Chapter 5: Economists and the Banking System, Part 2: Adam Smith, Some Early Americans, and Friedrich List This chapter is about economics in transition. Economics means literally ‘housekeeping’ and most early writers on economics (roughly speaking before Adam Smith, 1723-90) treated it that way. They worried about a nation’s solvency, whether fairness generally prevailed in […]
How Bad Can This Get, And How Fast?
How Bad Can This Get, And How Fast? There’s so much negative real bad economic and financial news out there that it’s hard to choose a ‘favorite’, but I guess I’m going to have to go with what underlies and ‘structures’ it all, the IIF stating that for the first time since 1988 and the […]
China’s “Credit Mystery” Deepens, As Moody’s Warns On Shadow Financing
China’s “Credit Mystery” Deepens, As Moody’s Warns On Shadow Financing Last month, we took a detailed look at what we said could be a multi-trillion yuan black swan. In short, one of China’s many spinning plates is the country’s vast shadow banking complex which allowed local governments to skirt borrowing restrictions leading directly to the accumulation of […]
Equity Markets and Credit Contraction
Equity Markets and Credit Contraction There is one class of money that is constantly being created and destroyed, and that is bank credit. Bank credit is created when a bank lends money to a customer; it becomes money because the customer draws down this credit to deposit in other bank accounts and to pay creditors. […]
Low Interest Rates Cannot Save a House of Cards
Low Interest Rates Cannot Save a House of Cards When is the price of some marketable good or service at or near zero? When either the supply of it is so plentiful that virtually any demand, no matter how great, can be satisfied. Or when no matter how large or small the supply of it […]
Peak Oil Ass-Backwards (part 2): Crashing OilPrices Aren’t Due to an Oil Glut But to DemandDestruction and Peaking Credit
Peak Oil Ass-Backwards (part 2): Crashing Oil Prices Aren’t Due to an Oil Glut But to Demand Destruction and Peaking Credit As I began to mention at the end of the first part of this three-parter, I’ve only just recently come to the conclusion that oil prices aren’t going to have a tendency to rise due to […]
“Liars Loans” are Back…but with a Twist
“Liars Loans” are Back…but with a Twist Most of you will be intimately familiar with the roll “liars loans” played in last decade’s financial crisis. In a nutshell, these were loans in which the borrower was encouraged to lie about his or her income in order to qualify for a mortgage they couldn’t actually handle. […]
The Unwind
The Unwind Too often it’s as if I’m analyzing an altogether different world than conventional analysts. My strong preference is to be viewed as an adept and determined analyst, as opposed to some wacko extremist. I have always tried to distinguish my analysis from the “lunatic fringe.” It’s my overarching thesis that the world is […]
The Most Astounding Credit Binge in History
The Most Astounding Credit Binge in History Stripped Gears DELRAY BEACH, Florida – “The Donald” breathed a sigh of relief yesterday. He and other rich people got a break from the beating they’ve been taking: Stocks bounced, with the Dow ending yesterday’s session up more than 600 points. The gears have been stripped, and they […]
“The Most Astounding Credit Binge in History”
“The Most Astounding Credit Binge in History” But is the bounce to be trusted? “The Donald” breathed a sigh of relief. He and other rich people got a break from the beating they’ve been taking: Stocks bounced, with the Dow ending yesterday’s session up more than 600 points. But is the bounce to be trusted? […]
The 8 Trillion Black Swan: Is China’s Shadow Banking System About To Collapse?
The 8 Trillion Black Swan: Is China’s Shadow Banking System About To Collapse? “Wealth management products in China have come under the spotlight after a series of missed payments raised concerns over the shadow banking sector that often directs credit to firms shut out from bank lending or capital markets,” Reuters said in February, after reporting […]
The Boundaries and Future of Solution Space – Part 2
The Boundaries and Future of Solution Space – Part 2 The Psychological Driver of Deflation and the Collapse of the Trust Horizon The collective mood shifts rapidly from optimism and greed to pessimism and fear as the bubble bursts, and as it does so, the financial system moves from expansion to contraction. Financial contraction involves the breaking […]
The Boundaries and Future of Solution Space – Part 1
The Boundaries and Future of Solution Space – Part 1 Intro A great deal of intelligence is invested in ignorance when the need for illusion is deep. Saul Bellow, 1976 More and more people (although not nearly enough) are coming to recognise that humanity cannot continue on its current trajectory, as the limits we face […]
