Socio-Economics History Blog

Socio-Economics & History Commentary

Low Rates Will Trigger Civil Unrest as Central Banks Lose Control – BIS

The BIS warned that the low rate environment could result in a backlash from ordinary people whose savings were being eroded away Photo: AFP

The BIS warned that the low rate environment could result in a backlash from ordinary people whose savings were being eroded away Photo: AFP

  • Serpents warning about the problems they have created, pretending to be saviors, the good guys.
    -
  • Low rates will trigger civil unrest as central banks lose control – BIS 
    by Szu Ping Chan, http://www.telegraph.co.uk/ 
    Bank for International Settlements warns that low rates risk backlash as effects spill over into the real economy.
    -
    Low inflation, bond yields and interest rates around the world will push the boundaries of economic and political stability to breaking point if they continue on their downward trajectory, the Bank for International Settlements has warned.
    -
    The Swiss-based “bank of central banks” said the “sinking trend” of global rates would push countries further into uncharted territory. It highlighted that $2.4 trillion (£1.6 trillion) of long-term global sovereign debt was now trading at negative yields, with an increasing number of investors willing to pay governments for the privilege of lending to them.
    -
    “As bond markets show us day after day, the boundaries of the unthinkable are exceptionally elastic,” said Claudio Borio, head of the Monetary and Economic department at the BIS. “The consequences should be watched closely, as the repercussions are bound to be significant.”
    -
    The BIS warned that the low rate environment, which has already led to gaping pension deficits and lower bank profits, could risk a backlash from ordinary people whose savings were being eroded away.
    -
    It said 20 central banks had eased monetary policy over the past three months alone. Mr Borio noted that the low rate environment had become so acute that even the International Monetary Fund had set a floor on its special drawing rights – which serves as the IMF’s own form of international currency.
    -
    read more!
https://socioecohistory.wordpress.com/2013/04/18/the-tower-of-basel-secretive-plans-for-the-issuing-of-a-global-currency-2/

Click on image for article!

end

March 21, 2015 Posted by | Economics, Social Trends | , , , , , , , , , , | Leave a comment

Laurence Kotlikoff: Financial System Will Collapse Just a Matter of When!

  • Laurence Kotlikoff: Financial System Will Collapse Just a Matter of When! 
    by Greg Hunter’s USAWatchdog.com
    Renowned economist Laurence Kotlikoff recently testified at the U.S. Senate about the runaway U.S. budget.  How bad is it?  Kotlikoff says, “I told them the real (2014) deficit was $5 trillion, not the $500 billion or $300 billion or whatever it was announced to be this year.  Almost all the liabilities of the government are being kept off the books by bogus accounting. . . . The government is 58% underfinanced . . . . Social Security is 33% underfinanced . . . . So, the entire government enterprise is in worse fiscal shape than Social Security is, but they are both in terrible shape.”  So, how much is America on the hook for in the future?  Kotlikoff contends, “If you take all the expenditures that the government is expected to make, as projected by the Congressional Budget Office (CBO), all the spending on defense, repairing the roads, paying for the Supreme Court Justices’ salaries, Social Security, Medicare, Medicaid, welfare, everything and take all those expenditures into the future . . . and compare that to all the taxes that are projected to come in, and the difference is $210 trillion.  That’s the fiscal gap.  That’s our true debt.”
    -
    Professor Kotlikoff goes on to say, “It will collapse.  It is just a matter of when.  I can’t say when, but all I can say it’s going to be too late. . . . We are seeing signs of this in the economy, but we are not picking it up that clearly.  The macro economy is not doing all that well.”  Kotlikoff goes on to say, “I think our financial system is really built to fail because it combines two things which really haven’t been addressed. . . . It combines leverage, borrowing by the financial middlemen and then investing in things that they don’t tell you they are investing in.  So, there is opacity and leverage.  These are the two major problems for the banking system.  What we need to do is get rid of the leverage and get rid of the opacity.  We need full disclosure of the investments of our financial institutions.”
    -
    Where can you get a safe investment?  Kotlikoff says forget U.S. Treasury bonds.  “I think they are one of the riskiest securities in the world because interest rates are likely to go up.  I think the Fed is going to have to keep printing money because Congress isn’t paying our bills, and that’s going to lead to inflation eventually.  So, I think long term Treasuries are extremely risky, and they can drop 5%, 10% or 20% overnight.  That could put my bank that was viewed as perfectly safe today out of business.  So we could have inflation take off and interest rates go up.  We could have banks fail, and that could lead to runs on other banks.  That’s the scenario,” says Professor Kotlikoff.
    -
    read more!

end

March 20, 2015 Posted by | Economics | , , , , , , , , , , , , | 1 Comment

Even Ed Yardeni Admits “This Is Not Investing… The Markets Are All Rigged”!

  • Even Ed Yardeni Admits “This Is Not Investing… The Markets Are All Rigged”! 
    by Tyler Durden, http://www.zerohedge.com
    “This is not investing,” exclaims Ed Yardeni in this brief clip, “it is all about central bankers… these markets are all rigged.” That is not a criticism he notes, “I just say that factually… I love these central bankers, they’ve been very good to the stock market.” The clip is then followed by a defense of this pumping by central banks, because “we are a 401(k) society.” Which apparently ignores the whole “massive inequality gap” issue that is staring America right in the eyes… But for now stocks are up so “shut up and enjoy it” as Larry Kudlow said yesterday.

    read more!

end

March 20, 2015 Posted by | Economics | , , , , , , , , , , , | 1 Comment

The Titanic Sinks At Dawn!

Global financial system Titanic hits iceberg!

Global financial system Titanic hits iceberg!

  • The Titanic Sinks At Dawn! 
    by , http://deviantinvestor.com/ 
    What Titanic?  The RMS Titanic, or any of the following:
    -
    * A titanic quantity of derivatives – say 1,000 Trillion dollars. A derivative crash was at the center of the 2008 market meltdown.  It could happen again since there is now more debt, leverage, and risk than in 2008.
    -
    * A titanic accumulation of debt – global debt is approximately $200 Trillion. Global population is about 7,000,000,000 so there is about $28,000 in debt per living human being.  If global debt were backed by all the gold mined in the history of the world, an ounce of gold would back $36,000 in debt.  Gold currently sells for less than $1,200.  Gold is undervalued and there is an excess of debt.
    -
    * A titanic increase in debt in the past decade. Official US debt increased by over $10,000,000,000,000 in the past ten years.  What did the US gain from the increase of $10 Trillion in debt?  Are debt accumulation and expense policies materially different in Europe or Japan?  Was the debt used to create productive assets or was it just flushed down the toilet into non-productive expenditures?  THE BENEFIT IS GONE, BUT THE DEBT REMAINS.  This debt accumulation policy is neither good business nor sustainable.
    -
    * A titanic bond bubble. Since interest rates are currently at multi-generational lows, or 700 year lows in Europe, or perhaps all-time lows, that strongly suggests a bubble in bonds.  Would you buy a bond from an insolvent government knowing the government will pay you next to nothing in interest over the next ten years?  Further, the government is guaranteeing a devalued currency so any dollars, euros, or yen you eventually receive will be worth much less in purchasing power than today.
    -
    * A titanic currency bubble in the US dollar, which just hit a 12 year high after a parabolic rise since May last year. Experience with parabolic rises suggests extreme caution.
    -
    * A titanic collapse in the crude oil market. Supply is strong, demand is weak, and prices have fallen to about $45 from about $105 last June.  The last time crude oil prices fell was from July to October 2008, a most difficult time.
    -
    The titanic creation of paper assets such as bonds, currencies, and stocks has created substantial risk.  That risk has spilled over into the crude oil, gold and silver markets since they are strongly influenced by the paper derivative markets – paper contracts for crude oil, paper gold, and paper silver.  Leverage and derivatives magnify risk.  The instability will eventually create a second version of the 2008 recession/depression.
    -
    read more!

end

March 20, 2015 Posted by | Economics | , , , , , , , , , , , , , | 1 Comment

ECB Prepares For Grexit, Anticipates 95% Loss On Greek Debt!

Counterfeiters_in_Chief_Draghi_Bernanke

end

March 19, 2015 Posted by | Economics | , , , , , | 1 Comment

There is Austerity for People But Not for Europe’s Economic, Political Elite!

  • Published on Mar 18, 2015
    Protesters in Frankfurt gathered to sabotage the opening of the European Central Bank’s new €1.3 billion campus. For many Europeans, the huge luxury offices built in the midst of an economic recession represent everything that is wrong with the institution. RT talks to Costas Panayotakis, an author and professor of sociology at the New York City College of Technology.

end

March 19, 2015 Posted by | Economics | , , , , , , , , , , | 1 Comment

Super-Bubbles And Unprecedented Global Collapse – Time Is Running Out!

White_House_US_Flag_Burning

  • Super-Bubbles And Unprecedented Global Collapse – Time Is Running Out! 
    by http://www.kingworldnews.com
    Today the man who remarkably predicted the collapse of the euro against the Swiss franc warned King World News that we are now living in world of super-bubbles that has the planet headed toward an unprecedented global collapse and, importantly, time is now running out.

    Egon von Greyerz:  “Eric, we are now at the endgame and this is the biggest economic and financial bubble in history.  Virtually every country in the world is under enormous pressure.  But one country believes it is immune to all these problems around the world and that is, of course, the United States.

    -
    With both U.S. stocks and bonds near the highs and the dollar (recently) surging, it seems that the U.S. is still an invincible superpower.  But sadly, Eric, the U.S. will just be the last country to fall and that fall is imminent….
    -
    read more!

Global_Economic_Crisis

end

March 17, 2015 Posted by | Economics | , , , , , , , , , , , | Leave a comment

Billionaire Eric Sprott Just Made The Most Terrifying Prediction Of 2015!

Global meltdown coming! The world economy TITANIC is about to hit an iceberg!

Global meltdown coming! The world economy TITANIC is about to hit an iceberg!

  • Billionaire Eric Sprott Just Made The Most Terrifying Prediction Of 2015! 
    by http://www.kingworldnews.com
    Today billionaire Eric Sprott warned King World News that the entire global financial system is now facing the greatest danger in history.  He then issued the most dire prediction of 2015.

    Eric King:  “We had (the stock market collapse) of 2001 – 2003.  Then we had (the more intense collapse of) 2007, 2008, 2009.  The next one (collapse) is going to be worse because that’s just how these cycles progress.  As you know, they (seizures in the global financial system) get more violent and the collapses become more and more intense.  People couldn’t imagine it would get worse than 2001 – 2003, and yet we had 2007 – 2009.  This one that’s in front of us, I’m assuming it’s going to be the mother of all collapses.”

    Eric Sprott:  “Two words that come to my mind, Eric, ‘No bid.’  In other words, if you take the central planners out of the market, there is no bid….

    It’s So Preposterous
    “So who’s going to buy it?  Who in their right mind would be buying bonds with a negative yield?  It’s just so preposterous. And all of the sudden if the bond buyer is not there — we used to think it was so great that China would buy our bonds.  They don’t buy our bonds (anymore).  Russia used to buy our bonds — they (now) sell our bonds.

    No Bid Means Collapse
    The only entities buying the bonds are the central banks.  Well, you take the central bank out of it and there’s no bid.  That’s why I use the phrase, ‘I hope we are not right one day,’ that all of the sudden it (the entire global financial system) just collapses.

    -
    read more!

end

March 14, 2015 Posted by | Economics | , , , , , , , , , | 1 Comment

The Surging Dollar is a Signal that a Colossal Financial Event is Just Around the Corner!

Global economic, financial and currency collapse is coming!

Global economic, financial and currency collapse is coming!

  • The surging dollar is a signal that a colossal financial event is just around the corner! 
    by , http://www.businessinsider.com/ 
    The dollar is set for its strongest quarterly strengthening since 1992, according to Bank of America, a good sign that a rate hike is around the corner.
    -
    When markets expect that US interest rates will be hiked, it typically strengthens the dollar. That’s because people rush to change other currencies into dollars — they can make more money in dollar-denominated investments. The higher demand for the US currency drives its value up.
    -
    In the past, significant dollar gains against other currencies have pretty much happened only during periods of extreme financial or geopolitical distress.
    -
    The last four large dollar shocks in the past 45 years have been symptoms of huge financial events: the collapse of Lehman, Britain’s panicky ejection from the European Exchange Rate Mechanism (ERM) in 1992, the first Gulf War, and Paul Volcker’s shock rate hikes in the early 1980s.
    -
    Today’s surge is already considerably larger than the one that surrounded Lehman’s collapse, although the economic conditions are very different. Here’s how it looks in historical context:
    -
    read more!

US_Dollar_n_major_financial_events_since_1970

end

March 14, 2015 Posted by | Economics | , , , , , , | 1 Comment

UK To Join China-Led World Bank To Protect Itself From The Collapsing Dollar!

  • Published on Mar 13, 2015
    The unemployment rate for Canada increased to 6.8%.Umich consumer sentiment tumbles, its being blamed on the weather. Iceland made it official they will not join the EU. UK wants to join the China-led bank to protect itself from the collapsing dollar. FCC released its 400 pages and there is one sentenced that is troubling. US pushing regime change in Brazil, Argentina and Venezuela. Kiev will not let the OSCE monitor the troop removals. China is getting ready to change its constitution from a pacifist to an aggressor. Libya’s oil is now being sold not using the dollar. US says they could extend the war into Libya and Nigeria.

end

March 14, 2015 Posted by | Economics, GeoPolitics | , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | 1 Comment

Tsipras: There is No Greek Problem, There is a European Problem!

  • Published on Mar 13, 2015
    It is time to provide the Greek people with good news, Greek Prime Minister Alexis Tsipras said in Brussels Friday, following a meeting with the president of the EU Parliament Martin Schulz, which Tsipras described as productive.

end

March 14, 2015 Posted by | Economics | , , , , , , , | Leave a comment

Talks Underway With China & The IMF To Endorse Yuan As A Reserve Currency!

  • Published on Mar 12, 2015
    Russian FinMin confirms Greece talking to Russia. Greece is now looking to loot the pensions of the people. Retail sales implode. China and the IMF are in talks to endorse yuan as the next global reserve currency. China is looking to back their currency using gold. 47 senators violated the logon act. The Swiss are now spying on their own people. Ukraine has 2 days to abide by the Minsk deal. Kerry and Carter push for war in the middle east. US trying to convince the world that Assad is using barrel bombs on his own people. Another false flag to get into Syria.

end

March 13, 2015 Posted by | Economics, GeoPolitics | , , , , , , , , , , , , , , , , , , , , , , , , | 1 Comment

The U.S. Dollar Is Going Parabolic – Something Somewhere Is Collapsing!

USDX-11March2015

  • Financial derivatives contracts are priced mainly in US dollars. As the derivatives contracts are triggered, demand for US dollars will increase to settle these contracts. This will cause the US dollar to rise in value compared to other currencies. This is what we are seeing now in the US Dollar Index Chart above.
    -
  • The U.S. Dollar Is Going Parabolic – Something Somewhere Is Collapsing! 
    by http://investmentresearchdynamics.com/ 
    Marketvane’s Bullish Consensus for the $US hit 90% yesterday.  At the beginning of March it was 83%.  Market bullish sentiment toward the dollar has not been this bullish since the turn of the millenium.  It is a very strong contrarian signal…

    The US Dollar index is going parabolic.  More often than not, markets that go parabolic will crash.  This is what happened with the dollar in 2008 (click to enlarge): (top of post)

    -
    The common “narrative” out there is that the dollar squeeze is being fueled by European sovereign and corporate entities scrambling for dollars in order to pay dollar-denominated debt obligations. Yes, this is part of the equation. But, just like in 2008, it is a sympton of a castrophic underlying systemic problem. After all, the Fed has created close to $4 trillion in new dollars, $2.6 trillion of which are sitting in the excess reserve account of the big banks at the Fed earning interest. That’s $2.6 trillion in excess dollars that can used to fund any excess demand for dollars.

    There’s also a repo collateral short squeeze plus a vicious Treasury short-squeeze going on, especially in the middle of the curve, where the Fed has removed most of the supply. But again, these are all “symptoms” of an underlying problem. Let’s not forget that the price of oil, along with many other key economic indicators are collapsing right now.

    -
    I believe that the collapse in the energy sector has triggered a silent derivatives counterparty bomb that we can’t see because of the intentional opacity of the OTC derivatives market. But you don’t have a 50% collapse in a key economic commodity like oil – a commodity which has $100’s of billions in OTC derivatives securities wrapped around it – without some kind of counterparty default tsunami that has been triggered. Throw on top of that the Greece situation and you have a recipe for a derivatives financial nuclear meltdown.
    -
    Wall Street has been stunningly silent about the meltdown in the energy sector. There has not been one utterance about any derivatives connected to the situation. But we’ve seen at least two big energy junk bond issuers blow up. One of them did not even make the first interest payment on its debt. Without question there were OTC credit default swaps connected to this debt.
    -
    The parabolic dollar “short squeeze” storyline is what they want you see. I would suggest that something much bigger and catastrophic unfolding behind that curtain…
Global financial tsunami coming??!

Global financial tsunami coming??!

end

March 13, 2015 Posted by | Economics | , , , , , , , , | 1 Comment

Warren Pollock: We Are Headed for War Because There Is No Truth!

  • Warren Pollock: We Are Headed for War Because There Is No Truth! 
    by Greg Hunter’s USAWatchdog.com
    Wall Street analyst Warren Pollock said six months ago that the “damage control (about the bad global economy) was going to start to wear off in 2015.”  What are the signs the spin is wearing off?  Pollock says, “Go to your super market, and that is a sign the damage control is wearing off.  Prices are going up, and the quality of food is going down.  The numbers of ounces on each package are going down . . . This is the damage control wearing off.  A lot of people don’t have that purchasing power, and they won’t have that purchasing power in deflation or inflation.  When framing an issue, why do we even frame it as inflation or deflation?  Why not just talk about purchasing power?  Ask our government, how come my purchasing power has gone away.  Why do I have to take a seven year loan to buy a car?”
    -
    Pollock contends we are headed for a big failure and says, “For sure, and the small failures are expressing every single day, and they are absolutely noticeable if you care to notice them. . . . Look at the legislation they are passing.  Look at changes to the law in terms of banking and derivatives.  Before the mortgage blowup, we had changes to the bankruptcy law.  Before student loans blew up, there were changes to the bankruptcy laws.  Before derivatives blow up, there are changes to the law and how they are handled by the FDIC.  They just did that in December.  That’s predicting a coming derivatives market failure absolutely.”
    -
    Pollock goes on to say, “We might have a dramatic inflection point such as a nuclear reactor exploding or a war with Pakistan.  That is an area where the press sort of leaked out the reality.  They did this in a show called “Homeland,” and they were smacked down because they were talking about Pakistan.  They were told not to talk about Pakistan.”
    -
    read more!

end

March 13, 2015 Posted by | Economics, GeoPolitics, Social Trends | , , , , , , , , , , , , , , , , , , , , , , , , , | 1 Comment

“We Have Front-Row Seats To An Imminent Market Shock”, Hedge Fund Billionaire Warns!

Global economic, financial and currency collapse fast approaching!

Global economic, financial and currency collapse fast approaching!

  • “We Have Front-Row Seats To An Imminent Market Shock”, Hedge Fund Billionaire Warns! 
    by Tyler Durden, http://www.zerohedge.com
    Having previously noted that “this is the best shorting opportunity since 2007-9,” Billionaire hedge fund manager Cripsin Odey warns that (just as Goldman has noted) the global economy is h”eaded for recession and central banks will not be able to able to come to the rescue because they have exhausted the arsenal of policy weapons.” No matter what happens, he chides, the market shrugs it off as they are “kind of relying on central banks pulling a rabbit out of a hat.” They will not, “Central banks are not all singing and all dancing,” and cannot avoid the consequences of what they are doing, concluding, “you and I have got grandstand seats here [to an imminent market shock],” and investors are about to “find out just how illiquid it really is out there.”

    One of the world’s leading hedge fund managers has warned that global economies are headed for recession and central banks will not be able to able to come to the rescue because they have exhausted the arsenal of policy weapons. As The Sydney Morning Herald reports,

    -
    read more!

end

March 13, 2015 Posted by | Economics | , , , , , , , , , | 1 Comment

Follow

Get every new post delivered to your Inbox.

Join 957 other followers