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Our Marginal Economy

Before you buy another ticket for the Bull market bandwagon of “don’t fight the Fed,” perhaps you should take a look at the quality of the debt the Fed has enabled and the diminishing returns on all that debt.

The mainstream media is delighted to highlight positive economic data, but nobody ever asks about the quality of the borrowers who are behind the rosy numbers. Behind the rosy numbers, sales and profits are increasingly dependent on marginal buyers and borrowers: those buying on credit who would not qualify to borrow money in a system ruled by prudent risk-management.

These marginal borrower/buyers are last on, first off: they qualify for loans at the end of a credit expansion, when lenders throw caution to the winds to reap the profits from issuing new mortgages, auto loans, student loans, credit cards, etc. to marginal borrowers.

These marginal borrowers are the first to default, because they have insufficient income and collateral to support their loans.

This rising dependence on marginal borrowers/buyers leads to an economy of diminishing returns: ever-rising rates of debt expansion are required to generate ever-declining rates of expansion of sales, profits, GDP, etc.


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Russia Buys 18.6 Tonnes Of Gold In June – Currency Wars Intensify

Aggressive buying of gold and particularly silver by Russia will likely lead to defaults on the COMEX gold and silver futures exchanges and potentially an international monetary crisis. As sanctions, economic war and currency wars intensify we expect Russian and Russian ally buying of gold reserves and selling of dollars to intensify … (more…)

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New York comedian Lewis Schaffer – now a book is planned on his denuded selfhood


“It is a small, episodic book structured like a short story or a novella in the same vein as Julie Hecht’s book about Andy Kaufman – Was This Man a Genius? – or the stories of Belgian experimentalist Jean-Philippe Toussaint.”Read my latest daily blog in full here

• SO IT GOES – John Fleming’s Blog

Looks like UK has basically declared war on Russia (grabs popcorn)

Artwork by @mother_shipton

Artwork by @mother_shipton

Bitcoin is the Newest Alternative Investment for High Net Worth Individuals to Consider

I Have Bitcoins Bitcoin is the Newest Alternative Investment for High Net Worth Individuals to Consider

According to bitcoin news site CoinDesk, 2014 venture capital has flooded the bitcoin ecosystem reaching over $110 Million. Marc Andreessen, a well-known entrepreneur and investor, is betting big on the future of bitcoin with investments totaling upwards of $50 million. The Wall Street Journal’s Gregory Zuckerman reports that Andreessen has no plan on slowing down, claiming that he will invest “hundreds of millions” more in…..

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The Edinburgh Fringe’s free festivals as seen by The Free Festival’s Alex Petty


“I like comedy because it gives me a chance to meet bizarre, mentally-deranged people.”Read my latest daily blog in full here

• SO IT GOES – John Fleming’s Blog

The Case for a Bull or Bear Market in Two Charts

Which appears more likely–a straight-line extension of the past two years’ rise in stocks, or another “impossible” decline to complete the megaphone pattern?

There are dozens of charts and data points supporting the case for a continuation of the Bull market in stocks or a reversal into a Bear market. For the sake of brevity I’ve distilled the two arguments into two charts, one for the Bull case and one for the Bear case.

The Bull case is easy: the economy has reached self-sustaining expansion, a.k.a. escape velocity; hotel occupancy rates are high, home valuations are rising, stocks are fairly valued based on forward earnings, debt has been paid down/written off, and the Fed has tapered its quantitative easing (QE) bond and mortgage buying with no ill effect.


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How Israel Uses Twitter, Facebook & Tinder to Legitimize Murder | Brainwash Update

Silver Manipulation To End; $150 Per Ounce Possible – Video

Manipulation of the silver market was covered in a just released ‘Get REAL’ Special on Silver. Key topics discussed in the interview include *The fix is in: Old boys, pints of beer, big cigars and top hats, *the risk of manipulation through HFT, computer trading and ‘dark pools,’ * “Meet the new boss; same as the old boss,’  *The importance of owning allocated and especially segregated silver.  (more…)

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Paul Craig Roberts: ‘US proof of Russian fire in Ukraine released via email, social media is fake’

How Bad Can The Junk-Bond Sell-Off Get? So Bad It’ll Take Down Stocks

OK, let’s forgive Goldman for flip-flopping. At the peak of the bubble, trigger fingers are nervous, and flip-flopping is the norm. A week earlier, a Goldman strategist, in a very bullish mood at the time, raised his year-end target for the S&P 500 to 2,050. But that’s like so last week. Now Goldman’s strategy folks downgraded global stocks. And they gave a peculiar reason.

Read……   How Bad Can The Junk-Bond Sell-Off Get? So Bad It’ll Take Down Stocks 

Finite Resources And The Geography of Conflict


Ukraine. Iraq. Nigeria. Libya. Tunisia. Syria. All are hotspots of conflict in different regions of the world, yet the same underlying cause behind each can clearly be seen when looking through the lens of finite resources.

In the end, all wars are resource wars.

Click to read the full article

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