• Sprott Money
    05/06/2016 - 06:03
    The US, in its own decline, is showing this same self-destructive tendency. The worse things get, the greater the inclination of the citizenry to say, “Carry on, everything’s fine.”

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Warning Signs

Rising wages and employment costs (benefits, healthcare, etc.) are a direct input into the profitability equation. Therefore, as the economy slows and other cost-cutting measures, accounting gimmicks and share buybacks lose their ability to increase bottom line profitability, it is only a function of time before the focus returns to the cost of labor. With corporate profitability currently under pressure, overall economic activity weak and global conditions deteriorating, just how long can companies sustain employment and wage growth? The answer is not long.


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Haunting Pictures Of A Transportation Recession As Freight Rail Traffic Plunges

The impact of the transportation recession on railroads is now very visible. Here’s how Union Pacific is dealing with this issue, via Google Earth, on May 3: 292 engines idled on a siding west of Benson, Arizona, along I-10, for a stretch of nearly 4 miles. Note how the line of locomotives curves and fades into the left edge of the photo – an once majestic and haunting sight, all these powerful machines idled on a track in the Arizona desert...


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The Death Of #NeverTrump

It appears from the explosion of social media furore that, as infowars.com reports, the #NeverTrump movement and social justice warriors are completely imploding after Trump won the Indiana primary and became the presumptive Republican nominee for President.


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When You Run Out Of Other People's Money

...it's time for another bailout!!


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For The First Time Ever, China Shows Footage From Disputed, Man-Made Reef

For the first time ever, Chinese State television has aired construction work on the artificial island known as the Fiery Cross, or Yongshu, Reef in the Nansha Islands, located in the contested territory inside the South China Sea.


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Homemade Bomb Explodes At California High School

A homemade bomb exploded on the campus of Southern California school for foster youth according to NBC 7 San Diego. The school was on lockdown for a period of time, but ultimately was deemed safe. Fortunately nobody was injured in the incident.


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The True State Of The US Consumer: All Six Retail Companies Reporting April Comp Sales Missed

If one looks at the state of retail companies reporting same-store sales today, a troubling picture emerges about both the US economy and the US consumer emerges. As Bloomberg notes, each of six companies, among which L Brands, Zumiez, The Buckle, Costco, The Cato Corporation and Fred's - that reported April comparable sales missed estimates compiled by Retail Metrics.


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Migrant Rape Epidemic Reaches Austria

The brutal gang rape of a woman by three Afghan asylum seekers in central Vienna on April 22 has shocked the Austrian public and drawn attention to a spike in migrant-related rapes, sexual assaults and other crimes across the country. However, those who dare to link spiraling crime to Muslim mass migration are being silenced by the guardians of Austrian multiculturalism.


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Support For Anti-Muslim AfD Hits Record High As 60% Agree That "Islam Does Not Belong In Germany"

An astonishing 61% of Germans agreed that Islam does not belong in Germany. This result further explains AfD's surge in popularity, as the AfD reportedly has a section in its new party program called "Islam is not part of Germany", which is a position that 92% of its supporters agree with.


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One Chart Says It All

This chart says it all: real income is declining and the bottom 95% are poorer. No wonder people are socking away what they can and tightening their spending: they have no other choice, even as the Federal Reserve strip-mines their savings.


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Trumped! Why It Happened And What Comes Next, Part 1

First there were seventeen. At length, there was one. Donald Trump’s wildly improbable capture of the GOP nomination, therefore, is the most significant upheaval in American politics since Ronald Reagan. And the proximate cause is essentially the same. Like back then, an era of drastic bipartisan mis-governance has finally generated an electoral impulse to sweep out the stables.


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The World's Largest Shipping Company Is Already Preparing For The Next Oil Crash

It is the risk that the current 60% rebound in oil prices from 2016 lows is just another temporary bounce, that has forced Maersk to start preparing for the next oil crash. The company's CEO is confident that since the world keeps producing more petroleum than it can consume, it is "adapting its cost base to prepare for the risk of lower crude prices" according to Bloomberg.


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"Summer Of Shocks" Is Upon Us: BofA Warns "Own Volatility", Wait To Buy Stocks Until VIX > 20

"Own volatility.." is the subtle message from BofA's Michael Hartnett, who warns "don't add risk before SPX 1950-2000 range and/or VIX>20." Simply put, as he explains below, bullish "positioning shocks" & "policy shocks" are largely behind us; and there is no bullish "profits shock" coming in a world that cannot cope with a higher US dollar & higher rates.


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From 'Mad Dog' Mattis To New Mexico's Martinez - Donald Trump's Top 10 'Veep' Contenders

The race for The White House appears to have taken a backseat for a news cycle as the Republican "veepstakes" gets underway. Donald Trump said this morning that he would prefer a running mate with government experience to "help with pushing legislation through," adding that he puts a 40% chance that a former rival in the Republican race would get the nod. As The Hill reports, picking a VP could be a difficult undertaking, as some potential candidates might be hesitant to hitch their political future to a polarizing figure like Trump, but there will be plenty willing to roll the dice and join his historic outsider campaign.


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