Blog Archives

Jon Matonis: Private blockchains are still a distraction. Bitcoin’s sole purpose is to remove the State from the production of money.

Yellen-Terrorist-The-Dollar-Vigilante

Financial System Will Completely Seize Up Within 48 Hours of Gold Delivery Failure – Bill Holter

The global financial system will completely seize up and close for trading once gold delivery fails.  This will only take 48 HOURS after a failure, and the ability to procure metal, sell stocks and bonds, or do anything else financial will not be an option. (more…)

Welcome to the Recovery – 1 Out of 7 Americans (45.5 Million) Remain on Food Stamps

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More than six years into Dear Leader’s glorious economic recovery, 45.5 million Americans, or one in seven, remain on food stamps.

I’d say that’s a problem, but I don’t want to be accused of “peddling economic fiction.”

Read the rest here.

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[KR871] Keiser Report: Stupid people & stupid policies

We get the popcorn and the potato chips out to discuss the symbolism of negative interest rates, yield curves and intraday oil price swings. In the second half, Max interviews Brenda Kelly, head analyst at London Capital Group, about negative interest rates, US durable goods orders and fraud booms.

The Global Economy Could Fall Farther and Faster Than Pundits Expect

The core narrative of central bank/cartel capitalism is centralized agencies have the power to limit downturns and extend credit-based “good times” almost indefinitely. The centralized power bag of tricks includes fiscal policies such as deficit spending to boost “aggregate demand” in downturns and monetary policies such as lowering interest rates to zero and buying assets, a.k.a. quantitative easing.

If we crawl under the barbed wire and escape the ideological Keynesian Concentration Camp, we find thinkers such as Ugo Bardi, John Michael Greer andDimitry Orlov, whose work explores the dynamics of collapse, resilience and sustainability.

All three have added a great deal to my own (emerging) understanding of the many dynamics of collapse.

We can summarize the dynamics of collapse in many ways; here’s one: collapse is latent fragility manifesting. A familiar (and tragic) health analogy offers an example: a middle-aged man doesn’t appear ill, a bit thick around the middle perhaps, but neither he nor his intimates can see the fragility of his clogged arteries and blood-starved heart. Seemingly “out of the blue,” the man has a massive heart attack and passes from this Earth, to the shock of everyone who knew him.

Financial collapse isn’t “out of the blue,” any more than a heart attack is “out of the blue.” Actions and choices have consequences, and as resilience and redundancy are slowly stripped from complex systems, systemic fragility builds beneath the surface. At some difficult-to-predict point, a threshold is reached and the complex system fails.

In the financial realm, fragility builds as the system relies ever more heavily on marginal lenders, borrowers, buyers and investments for its “growth.” The current “recovery” (smirk) is completely dependent on marginal lenders (China’s shadow banking), borrowers (auto buyers taking subprime 7-year loans), buyers (corrupt Chinese officials buying $3 million homes in Vancouver B.C. with their ill-gotten gains) and investments (empty malls, empty factories, stock buy-backs, etc.).

The problem for “growth” based on the fragile margins is that the entire system becomes fragile as a direct result of this dependence on fragile margins. The current global real estate bubble is predicated on one condition: that the supply of corrupt Chinese officials fleeing China with ill-gotten millions to invest overseas is endless.

But no supply of corrupt officials, even in China, is truly endless, and markets based on this thin edge of corrupt capital will collapse once the corrupt capital dries up.

The same can be said of marginal oil production, marginal auto/truck buyers, marginal cafes, marginal malls, etc. When fragile (i.e. highly risky) shadow banking becomes a dominant force in credit, the system itself becomes fragile.

Conventional economists are entirely blind to system fragility. There is no ready Keynesian Cargo Cult econometric formula that measures systemic fragility, so it simply doesn’t exist within conventional economics.

This is why financial panics and collapses always appear (like fatal heart attacks) to be “out of the blue” to conventional economics.

I propose that the Global Recession of 2016 will trace the Seneca Cliff as described by Ugo Bardi. This application may not align with Bardi’s own work, and I want to make it clear this application is my own, not Bardi’s. But I think a strong case can be made that the global financial/economic system is primed for a ride down the Seneca Cliff:

Recall that the global “recovery” 2009 – 2015 was entirely based on the expansion of debt taken on by marginal borrowers. Systemic fragility doesn’t respond to central bank jawboning or Keynesian claptrap; unlike those “policy tools,” fragility is real.

My new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All is being published in China later this year.

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GOLD – It’s Time to Pay Attention

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First, let’s look at the improved fundamentals. Gold bugs will exasperatingly proclaim that fundamentals have been great for the past four years yet the price plunged anyway, so who cares about fundamentals? To this I would respond with two observations. First, large institutional investors and sovereign wealth funds have been anticipating a rate hike cycle for a very long time now. They didn’t know when, but they expected it. The fact that the gold bugs never believed this is irrelevant; what matters is that big money believed it, and it was perceived to be very gold negative. In their minds, this anticipated rate hike cycle would confirm that things were getting back to normal, and if things are normal you don’t need to own gold, right?

The problem is that this assumption is quickly being called into question. Sure the Fed hiked rates once, but it is starting to look more and more like a policy error. Meanwhile, other major central banks around the world are going in the opposite direction, toward negative rates. I am a huge believer in market psychology, and the psychology dominating the minds of most institutional investors over the past few years has been that things were slowly getting back to normal…

Read the rest here.

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Want your own #special ЯUSSIAИ art-postcard direct from artist in Volgograd?

Blockchain Solutions for $18 Trillion Trade Finance Market

Skuchain Developing Blockchain Solutions for $18 Trillion Trade Finance Market IHB News™

“Skuchain’s vision of building a “commerce cloud” where trade partners can interact friction-free and gain deep visibility into their supply chains is compelling,”

– Barry Silbert, Founder and CEO of Digital Currency Group

Read more about Skuchain

Read What the Professor Who Helped Expose the Flint Water Scandal Said About Science and Academia in 2016

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It was the injustice of it all and that the very agencies that are paid to protect these residents from lead in water, knew or should’ve known after June at the very very latest of this year, that federal law was not being followed in Flint, and that these children and residents were not being protected, and the extent to which they went to cover this up exposes a new level of arrogance and uncaring that I have never encountered.

– Virginia Tech Professor, Marc Edwards

Unless you’ve been living under a rock for the past several weeks, you’ll be aware of the extremely sad and infuriating water scandal that has been exposed in Flint, Michigan. Marc Edwards, a courageous and ethical professor of civil-engineering at Virginia Tech University, played a major role in exposing this public health danger as well as the inexcusable efforts of scientists and public officials to cover it up…

Read more here.

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[KR870] Keiser Report: Russian New Culinary Movement

We discuss sweethearts, strippers and 666 as Valentine’s Day comes early for the devils at the UK’s tax office. We also play a video clip from an interview with Boris Akimov of LavkaLavka restaurant (lavkalavka.com) in Moscow discussing sanctions, GMOs and hipsters. In the second half, Max interviews Kerry-Anne Mendoza of TheCanary.co about Osborne’s Britain, where austerity-induced suicides are up double digit percentages and the taxpayer is losing billions on stealthly but massive privatizations of state assets.

Stupor Bowl 2016

When I use the phrase Stupor Bowl, I refer not to the upcoming Super Bowl or the crazy mid-winter bicycle free-for-all in Minneapolis, but to the economic game of watching the Bear’s Recession Offense crush the Unicorn-believing Bulls.

Let’s follow the score here in the opening minutes of the Recession 2016 contest:

1. Sales have only one way to go: down. Touchdown Bears.

2. Profits have only one way to go: down. Touchdown Bears.

3. Stock buybacks have only one way to go: down. Touchdown Bears.

4. Global “growth” has only one way to go: down. Touchdown Bears.

5. Risk premiums have only one way to go: up. Touchdown Bears.

6. The efficacy of central bank “easing” only one way to go: down. Touchdown Bears.

This is getting stupefyingly repetitive, and the game has barely started: the Bears have racked up 42 points while the Unicorn-believing Bulls are scoreless.

The Unicorn-believing Bulls are going to need not just one Immaculate Reception, but a half-dozen miracle scores just to stay in the game. But the Bears have barely dented their playbook:

7. Government deficits have only one way to go: up.

8. The growth rate of private-sector debt has only one way to go: down.

9. The number of nations with crashing currencies has only one way to go: up.

10. The number of nations defaulting on sovereign debt has only one way to go: up.

11. The number of IPOs that quickly fall below their initial price has only one way to go: up–way up.

12. The number of margin calls to be issued to overleveraged “investors” has only one way to go: up–way up.

13. The number of junk bonds that will default has only one way to go: up–way up.

14. The number of Greater Fools willing to pay outlandishly absurd prices for homes in hot markets is plummeting; as a result, the market value of real estate globally has only one way to go: down–way down.

The Bears can fumble a few plays and still score another 42 points with ease.

The Unicorn-believing Bulls will need the financial equivalent of The Catch just to avoid being skunked:

But even that won’t change the outcome–a recession that will leave all the Unicorn believers, Keynesian Cargo Cultists and the rest of the delusional mob of Bulls stupefied by their crushing defeat.

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This Silver Investor is “Hell Bent on Taking the Precious Metals Battle Back to the Banksters”

This barbarian is hell bent on taking the battle back to the banksters.
Silver and gold will be his PERSONAL WAR CHEST in this coming battle…

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