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Here’s How the New U.S.-China Trade Talks May End

Trade talk
Photo by Flickr.com Kremlin.ru | CC BY | Photoshopped

Here’s How the New U.S.-China Trade Talks May End

With the U.S. and China in the midst of a new round of high level trade talks, this Thursday marks 22 months since tariffs were launched and the trade war began. Far from being “easy to win”, the trade war has lasted far longer than most analysts in the mainstream and alternative media predicted. In past articles, I have warned that the trade war itself is probably not meant to be won at all; rather, it is a massive distraction and a convenient scapegoat as global banks set the implosion of the Everything Bubble in motion. I continue to stand by this assessment, which is why I think it is unlikely that the current talks with China will accomplish much of anything.

This conclusion runs in stark contrast to all the hype we heard in the investment community in September. The way stock markets levitated, one would have thought a deal was assured. Never underestimate the power of blind optimism, I suppose. I believe there are a very limited number of end games to the meeting, none of which will result in an actual “deal”. However, it’s important to understand the dynamics at play here.

First and foremost, if we are to approach the trade war from a mere surface examination, there is really no incentive for China to capitulate to Trump’s demands. There is only one year left until the 2020 elections, and while BOTH economies are certainly seeing a downward plunge, China is hardly crippled by tariffs on exports to the U.S. China can simply bide its time, waiting to see how the U.S. election unfolds. The more unstable the U.S. economy is in 2020, the less likely it will be that Trump will win a second term.

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Debt Reset Begins, Global Banks Issue Dire Warnings, Trump Wall Showdown

Debt Reset Begins, Global Banks Issue Dire Warnings, Trump Wall Showdown

According to renowned gold investor Jim Sinclair, the global debt reset that has been long predicted has begun. Lots of debt that will never be repaid will be written down around the world. Sinclair says gold and silver will be the last men standing when the dust settles.

The BIS, World Bank and the IMF have all issued dire warnings in the past few weeks of financial “storm clouds.” In other words, the biggest bankers in the world are warning of another financial meltdown coming in the not-so-distant future.

Nance Pelosi and Chuck Schumer are being beaten up so badly over the government shutdown and security funding for a wall on the southern border that even singer Cher is telling the Speaker of the House and the minority leader in the Senate to “Be the Hero” and cave in and put 800,000 government workers back to work. The U.S. has a $4 trillion budget (that’s $4,000 billion) and Nancy and Chuck are holding up the government for little more than $5 billion in funding for security that includes a wall. Even Democrat James Carville is making fun of Chuck and Nancy’s response to Trump’s network appeal for a border wall and security on the southern border.

Join Greg Hunter as he gives his take on the top stories of the past week in the Weekly News Wrap-Up.

After the Wrap-Up:

Catherine Austin Fitts founder of Solari.com will be the guest for the Early Sunday Release. She will give us an update on the serious matter of $21 trillion in “missing money” at DOD and HUD and why it will soon affect every American.

Republican insider: Trump is creating Deep State 2.0, but it might crash the economy (EXCLUSIVE)

Republican insider: Trump is creating Deep State 2.0, but it might crash the economy (EXCLUSIVE)

Former GOP staffer says American president is a ‘mutation’ of unaccountable oligarchy pulling the strings of Democrats and Republicans alike

Mike Lofgren is a former Republican Congressional aide who spent 28 years as a Congressional staff member before retiring in 2011. During the last 16 years of his career, he held a high level national security clearance as a senior analyst for the House and Senate budget committees. His position gave him a first-hand insider’s perspective on a wide range of US government policies, from the lucrative bank bailouts, to accelerating Pentagon spending; from botched disaster relief after Hurricane Katrine, to the contradictions of the ‘war on terror’.

Now Lofgren is speaking out about the Donald Trump administration, its dangerous relationship with the American Deep State — and what it means for the future of the American Republic.

Mike Lofgren, 28-year veteran GOP staffer. Source: BillMoyers.com

Oligarchy

Last year, Lofgren released his second bookThe Deep State: The Fall of the Constitution and the Rise of a Shadow Government, in which he drew on his insider experience on Capitol Hill to reveal the inner workings of the US government.

His chief contention is that the US political system has, for all intents and purposes, become an oligarchy — with different Democrat and Republican administrations pursuing policies that remain constrained within the same defunct paradigm of extractive finance in service to the burgeoning bureaucracies of private defense firms, giant corporations, and global banks — benefiting the few at the expense of the many.

I caught up with Lofgren to find out the former longtime Republican operative’s prognosis for how the Deep State will fare in the Age of Trump.

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What Secret Do Global Banks Know about Chinese Banks?

What Secret Do Global Banks Know about Chinese Banks?

“Now is the right time for us to sell this investment,” announced Deutsche Bank’s newish co-CEO John Cryan on Monday after the long Christmas weekend when no one was supposed to pay attention.

It was how Cryan justified the deal to sell Deutsche’s entire 19.99% stake in Hua Xia Bank in China to Chinese insurer PICC Property and Casualty. He couched the deal in terms of executing Deutsche’s “strategic agenda”: boosting capital ratios to prop up the balance sheet.

Deutsche isn’t the first Western bank to bail out of banks in China where regulators limit foreign ownership stakes to a maximum of 20%, which brings some complications.

Goldman Sachs sold its stake in Industrial and Commercial Bank of China in 2013. Bank of America Merrill Lynch bailed out of its stake in China Construction Bank in a series of deals. BBVA, Spain’s second largest bank, has been cutting its stake in China Citic Bank from about 15% in 2013 down to 4.7% now, and that remainder appears to be earmarked for sale as well. Other banks are also likely to pick up their marbles and go, such as Standard Chartered, with its stake in Agricultural Bank of China.

Like Deutsche, they couched those deals in terms of boosting capital ratios and balance sheets.

And Deutsche could use some balance sheet repair. One of the largest and most leveraged global banks, it has been tangled up for years in a long list of scandals, court cases, and multi-billion-dollar settlements. Recently it suspended senior staff in Russia after suspecting they’d assisted in laundering money for sanctioned buddies of President Vladimir Putin. We were all shocked.

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The Numbers Say That A Major Global Recession Has Already Begun

The Numbers Say That A Major Global Recession Has Already Begun

Global - Public DomainThe biggest bank in the western world has just come out and declared that the global economy is “already in a recession”.  According to British banking giant HSBC, global trade is down 8.4 percent so far this year, and global GDP expressed in U.S. dollars is down 3.4 percent.  So those that are waiting for the next worldwide economic recession to begin can stop waiting.  It is officially here.  As you will see below, money is fleeing emerging markets at a blistering pace, major global banks are stuck with huge loans that will never be repaid, and it looks like a very significant worldwide credit crunch has begun.  Just a few days ago, I explained that the IMF, the UN, the BIS And Citibank were all warning that a major economic crisis could be imminent.  They aren’t just making this stuff up out of thin air, but most Americans still seem to believe that everything is going to be just fine.  The level of blind faith in the system that most people are demonstrating right now is absolutely astounding.

The numbers say that the global economy has not been in this bad shape since the devastating recession that shook the world in 2008 and 2009.  According to HSBC, “we are already in a dollar recession”…

Global trade is also declining at an alarming pace. According to the latest data available in June the year on year change is -8.4%. To find periods of equivalent declines we only really find recessionary periods. This is an interesting point. On one metric we are already in a recession. As can be seen in Chart 3 on the following page, global GDP expressed in US dollars is already negative to the tune of USD 1,37trn or -3.4%. That is, we are already in a dollar recession. 

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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 for their despair – the shredding of state structures and grip of Islamic fundamentalism on young Muslim minds – shows no sign of disappearing.

Yet there is a parallel collapse in the economic order that is less conspicuous: the hundreds of billions of dollars fleeing emerging economies, from Brazil to China, don’t come with images of women and children on capsizing boats. Nor do banks that have lent trillions that will never be repaid post gruesome videos. However, this collapse threatens our liberal universe as much as certain responses to the refugees. Capital flight and bank fragility are profound dysfunctions in the way the global economy is now organised that will surface as real-world economic dislocation.

The IMF is profoundly concerned, warning at last week’s annual meeting in Peru of $3tn (£1.95tn) of excess credit globally and weakening global economic growth. But while it knows there needs to be an international co-ordinated response, no progress is likely. The grip of libertarian, anti-state philosophies on the dominant Anglo-Saxon political right in the US and UK makes such intervention as probable as a Middle East settlement. Order is crumbling all around and the forces that might save it are politically weak and intellectually ineffective.

The heart of the economic disorder is a world financial system that has gone rogue. Global banks now make profits to a extraordinary degree from doing business with each other. As a result, banking’s power to create money out of nothing has been taken to a whole new level. That banks create credit is nothing new; the system depends on the truth that not all depositors will want their money back simultaneously.

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High Priests of Global Finance Stoke Emerging Market Fears

High Priests of Global Finance Stoke Emerging Market Fears

Two of the most important guardians of global finance, the IMF (International Monetary Fund) and the IIF (Institute of International Finance), gave their verdict on the current state of the global economy this week. And their message could not be clearer: beware the dreaded fate of emerging markets.

The World According to A Prestigious Club of Global Banks

The IIF warned this week that hot money is pouring out of emerging markets at a startling rate, primarily on the back of China’s crunching slowdown and rising fears of a looming US rate hike.

Before we go any further, here’s a caveat: The IIF is a prestigious “club of global banks.” After the Club of 30, it is arguably the most powerful financial lobby association on the planet. It is also one of the strongest proponents of self-regulation in banking, a major cause of the Global Financial Crisis. Could an organization like the IIF have ulterior motives?

This year capital outflows from emerging economies will surpass inflows for the first time since 1988. Residents sending cash out of the emerging markets has accelerated amid recent financial market volatility while at the same time foreign investment is set to nearly halve from $1,074 billion in 2014 to just $548 billion this year.

The countries most at risk are those with high current account deficits, pronounced levels of corporate debt denominated in foreign currencies, and extreme political uncertainty. Brazil, whose currency has suffered a 30% currency depreciation this year, and Turkey (15%) are among the nations “in this situation,” the report warns. The nation most at risk is Venezuela, which (according to estimates by US financial firms) is currently suffering annual inflation of 120%. The country’s risk of default is “extremely high” and could even happen as early as 2016, warns the IIF.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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