Global Economy Bursting?

[Randolph Kinney]

Zombie Banks and Vampire Governments

http://lewrockwell.com/north/north1106.html

So, the expansion of the monetary bases of the central banks zooms into hyperinflation territory. The debt-to-GDP ratio of the governments goes above 100. Yet prices are stable and government bond rates are low. It looks as though this can go on indefinitely. Can it?

 

[Riick]

So, the expansion of the monetary bases of the central banks zooms into hyperinflation territory. The debt-to-GDP ratio of the governments goes above 100. Yet prices are stable and government bond rates are low. It looks as though this can go on indefinitely. Can it?

Paraphrasing our dear friend Lord Keynes:
"The Market can be irrational longer than you and I can stay Solvent"

 

[Restrain]

JP Morgan Chase whistleblower posted a letter to the CFTC, pulled almost immediately. Letter is reproduced in this article. Fear of cascading credit event.

http://modernsurvivalblog.com/curre...n-chase-whistleblower-cascading-credit-event/

 

[Terrel L. Shields]

Yes, we at JPMorgan that are in the know are fearful of a cascading credit event being triggered in Greece as they have hidden derivatives in excess of $1 Trillion USD. We at JPMorgan own enough of these through counterparty risk and outright prop trading that our entire IB EDG space could be annihilated within a few short days.

I don't know if this is true or a fraud. But face it. We've played hide the pickle too long. With all the mortgages that have had the air sucked out of them and the central bankers and others are totin' the note .... default would trigger a massive restructuring of debt. AIG could not simple "eat" all the debt it had. By all accounts, it was in way way too far... They are allowing it to remain as a "zombie" and putting its value at some multiple of reality (i.e.- they are leveraged out the wazoo still.) It's like selling your coon dog for $1200 but taking 10 $100 ***** cats in on trade... The first number looks good.

 

[Randolph Kinney]

80 Percent Of Americans Say That They Are Not Better Off Than They Were Four Years Ago

http://theeconomiccollapseblog.com/...-not-better-off-than-they-were-four-years-ago

Are you better off today than you were four years ago? If not, then you are just like most other Americans. According to a CBS News/New York Times poll that was released a few days ago, 80 percent of Americans say that their financial situation is not "better today" than it was four years ago. But if you turn on the television and listen to what the "pundits" are saying, you would be tempted to think that we were in the midst of a robust economic recovery.

Yes, the stock market is doing really well for the moment, but the truth is that more than 50 percent of all stocks and bonds are owned by just 1 percent of the U.S. population.

Meanwhile, much of the rest of the country is deeply suffering.

It was recently reported that 1.5 million American families live on less than two dollars a day (before counting government benefits).

According to the U.S. Census Bureau, the percentage of Americans living in "extreme poverty" is now sitting at an all-time high.

All across this country poverty is exploding. Food banks are experiencing more demand than ever before and those offering free healthcare are absolutely swamped.

The federal government is trying to convince us that the unemployment rate is going down, but that is not really true.

The key is to look at the percentage of working age Americans that actually have jobs. During the last recession that percentage fell dramatically as you can see from the chart below. After every other recession since World War II the employment to population ratio has always bounced back. But it has not happened this time. Instead, the employment to population ratio has remained between 58 and 59 percent since the end of 2009....

 

[Randolph Kinney]

U.S. tab for European bailout hits $20 billion—and counting

http://washingtonexaminer.com/opini...n-bailout-hits-20-billion—and-counting/377406

Yesterday, the International Monetary Fund (IMF) approved a whopping $36.7 billion bailout of the banks that are owed money by the government of Greece.

Shockingly, U.S. taxpayers are on the hook for approximately $7.5 billion of the total.

Currently, the U.S. has a total exposure to the IMF of $165 billion. Although taxpayers fund 17.72 percent of the IMF, they are currently paying for more than 20 percent of its outstanding loans.

Part of the reason for that is because of an additional $108 billion the Pelosi-Reid Congress approved to the IMF in 2009, which included $100 billion in New Arrangements to Borrow (NAB) that the U.S. disproportionately funds.

Overall, including the new Greek bailout, taxpayers are already $20 billion deep into bailing out European financial institutions that bet poorly on sovereign debt of failed socialist states — and counting.

 

[DTB]

80 Percent Of Americans Say That They Are Not Better Off Than They Were Four Years Ago

http://theeconomiccollapseblog.com/...-not-better-off-than-they-were-four-years-ago

Are you better off today than you were four years ago? If not, then you are just like most other Americans. According to a CBS News/New York Times poll that was released a few days ago, 80 percent of Americans say that their financial situation is not "better today" than it was four years ago. But if you turn on the television and listen to what the "pundits" are saying, you would be tempted to think that we were in the midst of a robust economic recovery.

Yes, the stock market is doing really well for the moment, but the truth is that more than 50 percent of all stocks and bonds are owned by just 1 percent of the U.S. population.

Meanwhile, much of the rest of the country is deeply suffering.

It was recently reported that 1.5 million American families live on less than two dollars a day (before counting government benefits).

According to the U.S. Census Bureau, the percentage of Americans living in "extreme poverty" is now sitting at an all-time high.

All across this country poverty is exploding. Food banks are experiencing more demand than ever before and those offering free healthcare are absolutely swamped.

The federal government is trying to convince us that the unemployment rate is going down, but that is not really true.

The key is to look at the percentage of working age Americans that actually have jobs. During the last recession that percentage fell dramatically as you can see from the chart below. After every other recession since World War II the employment to population ratio has always bounced back. But it has not happened this time. Instead, the employment to population ratio has remained between 58 and 59 percent since the end of 2009....

I am afraid the times have changed. People need to be able to create their own opportunities or employment. The days of a job for life are gone, what's more troubling is that the way most have been educated renders them incapable of creating these opprtunities. The line between makers and takers will only get brighter.

Lots of people will continue to get hurt I'm afraid.

 

[Workbox]

I am afraid the times have changed. People need to be able to create their own opportunities or employment. The days of a job for life are gone, what's more troubling is that the way most have been educated renders them incapable of creating these opprtunities. The line between makers and takers will only get brighter.

Lots of people will continue to get hurt I'm afraid.

I'm afraid you are correct DTB, everything has changed, even I have changed. Many are living in uncertainty. I spoke to an older retired gentleman yesterday and he has held many jobs and sees that his children and grandchildren can not find good jobs and everything they are finding is service jobs that range from $8-13 an hour.

 

[Terrel L. Shields]

In the depression, you took whatever job you could find. My father used to do everything from work the flax harvest in W. Kansas, the pinto harvest in the late fall in SW colorado, potatoes in the San Luis Valley, and worked a livestock auction 1 day a week. When there was no outside work, they herded cattle down from the high country before snowfall, and grandad had a registered Belgian Stud horse that was driven by buggy to town on sale day and stood at stud for the incredible price of $10...he once said that horse kept him from starving to death during the depression. He worked him, he rode him, he hooked him to a buggy and used him as a stud...found a picture of him and the horse in mother's old pictures, and in my granny's handwriting on back was "two old studs, one a purebred and the other a scrub..."
I found an old family diary. The writer noted what he did every day. "Helped roof the porch of so and so", "planted potatoes, plowed new ground", "helped rebuild pens at the railroad stockyard", "worked WPA this week on new road", "Me and joe sit up with Art XX". "Art died today. Helped with group to dig grave, ground frozen"....Few things brought in money and Art dying didn't cost $10,000 to put away plus $40,000 in medical bills. They didn't go to the doctor. The coffin of my Ggther, according to the Military records was reimburse at $68. Friends dug your grave. The service was grave site or a nearby country church. You were buried in a family plot.

Today is just like what my father predicted 30 years ago. "The next depression everyone will have money, but it won't buy anything..."

Next week they auction a farm equipment off near here. I appraised the farm for far north of $500K plus years ago. Bankrupt. The owners are my age - two brothers. They've been in debt their whole life. There is roughly $500,000 in equipment (when new and when they bought it) to sell, maybe more. It will bring maybe $250,000. They will each keep their house and 5 acres. The bank gets the rest, about 400 acres. You know what? They are better off. No debt for the first time in their lives. Honestly, they've never owned the place in their name for 40 plus years. I know they can't think that way but soon they will realize they are far better off.

Nearby, the largest farm in the county save 1, has just sold out the last two major parcels. In two years they have liquidated about 3500 acres. The core 1000 acres is now under contract and the 200 acres with airport and 2 executive homes has closed I was told...I appraised it for an estate several years ago. It will bring a fraction when totaled of those nigh peak prices...all because the owner died at exactly the wrong time. His estate taxes were probably about the same as what they will realize from the sale of the property...The money generated? To pay off debts created by the failure of one bank and the near failure of the one remaining asset the family will keep..if the FDIC does not take that over.

 

[Randolph Kinney]

Money Supply booming, seeds of the next Greater Recession

http://www.forbes.com/sites/michael...-booming-seeds-of-the-next-greater-recession/

The next Great Recession is in the making. The money supply trends say so. And it is looking more and more like this next Greater Recession is going to be one for the ages…

The money supply, as measured by THE CONTRAIAN TAKE‘s broad (and preferred) TMS2 metric (TMS for True “Austrian” Money Supply), posted a 14.6% year-over-year increase in February, making this the 39th consecutive month of double digit year-over-year rates of monetary inflation. All told, TMS2 is up a huge 50% over those 39 months. Even more interesting is what those TMS2 metrics were leading up to the housing boom turn credit bust turn Great Recession – 37 consecutive months for a cumulative increase of 50%.