The latest ‘Global Precious Metal Roundtable’ was recorded Wednesday and featured Jordan Eliseo of ABC Bullion, Bron Suchecki of the Perth Mint and Ron Stoeferle of Incrementum and Mark O’Byrne of GoldCore.
The preposterous Gong Show in Brussels over the weekend was the financial “Ben Tre” moment for the Euro and ECB. That is, it was the moment when the Germans - imitating the American military on that ghastly morning in February 1968 - set fire to the Eurozone in order to save it. In short, Greece will become an outright debtors’ colony and its government will function as page-boy legislators for the Troika occupiers. Needless to say, political and social upheaval will erupt when the full extent of the Tsipras surrender becomes evident, and the resulting political contagion will spread throughout the length and breadth of Europe as Greece implodes. In due course, the euro will collapse and the baleful Keynesian money printers’ regime in Frankfurt will be repudiated and dismantled. But not before European democracy has a brush with death, and European prosperity is extinguished for a generation.
After weeks of overnight turbulence following every twist and turn in the Greek drama, this morning has seen a scarcity of mostly gap up (or NYSE-breakding "down") moves, and S&P500 futures are unchanged as of this moment however the Nasdaq is looking set for another record high at the open after last night's better than expected GOOG results which sent the stop higher by 11% of over $40 billion in market cap. We expect this not to last very long as the traditional no volume, USDJPY-levitation driven buying of ES will surely resume once US algos wake up and launch the self-trading spoof programs. More importantly: a red close on Friday is not exactly permitted by the central planners.
With Puerto Rico missing a payment on a bond overnight "due to non-appropriation of funds" but denying that this constitutes anything close to a default, the territory may be about to retake the limelight as Greece is now "fixed." As Peter Schiff explains, this is far from over... As in Greece, the Puerto Rican economy has been destroyed by its participation in an unrealistic monetary system that it does not control and the failure of domestic politicians to confront their own insolvency. But the damage done to the Puerto Rican economy by the United States has been far more debilitating than whatever damage the European Union has inflicted on Greece. In fact, the lessons we should be learning in Puerto Rico, most notably how socialistic labor and tax policies can devastate an economy, should serve as a wake up call to those advocating prescribing the same for the mainland.
Hyperinflation in the U.S. is coming sometime in the next 20 years or so, and this isn't a cry from a Chicken Little, but a conclusion that the analysis strongly suggests. It is possible hyperinflation could happen during the next few years, but that seems unlikely since it would require a series of major crises and political blunders – events unprecedented in the history of the United States. If this led to a corruption of Constitutional rights in the midst of an exaltation of the Executive Branch that resulted in loss of the rule of law, hyperinflation might result. It is much more probable that hyperinflation will be preceded by a long slow decline that will include a protracted period of high inflation, and that the crash of the dollar and hyperinflation will be the final tumble off a looming, steep cliff.
On Wednesday, Carl Icahn and Larry Fink engaged in an epic debate about the role ETFs play in perpetuating systemic risk. Icahn, taking a page from the Tyler Durden playbook, talks phantom liquidity before calling BlackRock "a dangerous company", and opining that Fink and Janet Yellen are "pushing the damn thing off a cliff."
Having now passed the anniversary of the “rising dollar”, it is interesting to see the related and continued effects on the stock bubble(s). As should be obvious by now, stock buybacks, funded via corporate bonds and loosely categorized C&I loans, are responsible for the post-QE3 nearly uninterrupted rise. Repurchases are forming a separate “liquidity” conduit, indirect leverage if you will, which has already started to fray. Various broader “market” indices have diverged, starting with the Russell 2000 in early 2014 (with the economic slowdown that was supposed to be an anomaly of weather). At the very least it might imply that the central bank paradigm that lasted since the middle of 2012 has greatly eroded or even ended.
Even as Greek banks, severely depleted of cash and eligible collateral they can post with the ECB, stand to fight another day (and potentially face more withdrawals as soon as the Greek banks reopen supposedly on Monday) thanks to another €900 million liquidity infusion, investors in Greek bank shares will be less lucky: "to ensure a new bailout, investors in the country’s banks faced the prospect of their holdings being "wiped out" under the terms of a €25 billion recapitalization plan."
Mario Draghi should remain "largely on message" in Thursday's ECB presser, with the deal struck in Brussels last weekend having spared him the inconvenience of convening a tense discussion about imminent Grexit. Expect the ECB to reiterate the central bank's commitment to implement PSPP in full and the market will no doubt be looking for any color the ECB cares to add about the event risks surrounding the implementation of a third Greek program and the recent turmoil in Chinese equity markets.
- Greece licks wounds after bailout vote, ECB move expected (Reuters)
- Lose-Lose: Pushing Greece Out of Euro Is Costlier Than Write-Off (BBG)
- EMU brutality in Greece has destroyed the trust of Europe's Left (Telegraph)
- Schaeuble Shrugs Off Greek Vote Saying Euro Exit Is Best (BBG)
- Merkel’s tough tactics prompt criticism in Germany and abroad (FT)
- Investors Get Caught in Oil’s Slippery Wake (WSJ)
- Obama Girds for Battle With Congress on Iran Deal (WSJ)
And so the 2015 season of the Greek drama is coming to a close following last night's vote in Greek parliament to vote the country into even more austerity than was the case before Syriza was voted into power with promises of removing all austerity, even with Europe - which formally admits Greece is unsustainable in its current debt configuration - now terminally split on how to proceed, with Germany's finmin still calling for a "temporary Grexit", the IMF demanding massive debt haircuts, while the rest of Europe (and not so happy if one is Finnish or Dutch) just happy to kick the can for the third time.
This must be one of THE most brainless and pernicious perpetrations against humanity!
As a result, the world’s economy is now based upon unsound banks dealing in unsound currencies. Both have degenerated considerably from their origins.
"What Europe Wants" - to use global issues as excuses to extend its power:
- environmental issues: increase control over member countries; advance idea of global governance
- terrorism: use excuse for greater control over police and judicial issues; increase extent of surveillance
- global financial crisis: kill two birds (free market; Anglo-Saxon economies) with one stone (Europe-wide regulator; attempts at global financial governance)
- EMU: create a crisis to force introduction of “European economic government”
Amid record auto loan ABS issuance, record loan terms, and record high average payments, it's no secret that the market for auto loans in the US has become dangerously stretched. Now, the NY Fed is out with what is perhaps the most shocking statistic yet on just how "darn easy" it is to get a car loan