Global Economy

Failing Stimulus And The IMF's New 'Multilateral' World Order

2015 will be a year of shattered illusions; social, political, as well as economic. The common claim today is that the QE of Japan and now the ECB are meant to take up the slack left behind in the manipulation of markets by the Fed. I disagree. As I have been saying since the announcement of the taper, stimulus measures have a shelf life, and central banks are not capable of propping up markets for much longer, even if that is their intention (which it is not). Why? Because even though market fundamentals have been obscured by a fog of manipulation, they unquestionably still apply. Real supply and demand will ALWAYS matter – they are like gravity, and we are forced to deal with them eventually. The elites hope that this will be enough to condition the public to support centralized financial control as the only option for survival... It is hard to say what kind of Black Swans and false flags will be conjured in the meantime, but I highly doubt the shift away from the US Dollar will take place without considerable geopolitical turmoil.

De-Dollarization Complete: Iran Abandons US Dollar In Foreign Trade

Since last May (and likely long before) when the topic of "de-dollarization" was first uttered in official circles (and not just tin-foil-hat-wearing blogs), the rest of the world (un-isolated as they are) has been warming to the idea that perhaps - just perhaps - it is time to de-dollarize (more or less depending on the despotic region in question). From currency swap agreements to bi-lateral trade agreements to selling US Treasuries and greatly rotating USD reserves into gold, the world's nations (small and large) appear less and less comfortable holdings dollars in this tempestuous world. Among the supporters of that first "de-dollarization" meeting were China and Iran and while the former continues to work down its exposure, the latter - Iran, according to Tasnim news agency, has almost entirely eliminated USDollars from its reserves and is no longer using dollars in foreign trade. De-dollarization complete...

The Lunatics Are Running the Asylum: Draghi’s Money Printing Bazooka

There is no reason to assume that this time will be different. These boom-bust sequences will continue until the economy is structurally undermined to such an extent that monetary intervention cannot even create the illusory prosperity of a capital-consuming boom anymore. The bankers applauding Draghi’s actions today will come to rue them tomorrow.

Sprott Money's picture

Another day goes by. Another day of the West’s (the One Bank’s) economic terrorism against Russia: an overt attack on that nation’s currency, and thus the economy itself. As noted in the commentary which preceded this; such economic terrorism against the ruble damages Russia’s economy, on a percentage-for-percentage basis.


Another day of defiance: by Russia itself, and (increasingly) the Rest of the World. We now know that part (and perhaps most) of the motive for this escalation of Western terrorism against Russia is gold.

Now Begins The Greatest Heist Since Bernanke Bailed Out Wall Street In September 2008

There is virtually nothing which is on the level in today’s financial markets. According to the Fed’s PR firm, Hilsenramp & Blackstone, one quarter of the $7 trillion in bonds issued by euro zone government are trading at negative yields. And this drastic financial repression prevails across the yield curve, not just on the short end. Yes, the juxtaposition is entirely reasonable that a state drifting toward insolvency and/or ruinous taxation should be able to borrow 10-year money at 0.70%. That is, when the fix is in, the central bank printing press is open to buy, the apparatchiks are terrified and one of history’s greatest monetary charlatans is in charge - the speculators have nothing to do but harvest their haul. So now begins the greatest heist since Bernanke bailed out Wall Street in September 2008.

Obama Issues Statement On The Death Of Saudi King Abdullah, Praises "Vision", US-Saudi Relationship

"King Abdullah’s life spanned from before the birth of modern Saudi Arabia through its emergence as a critical force within the global economy and a leader among Arab and Islamic nations.  He took bold steps in advancing the Arab Peace Initiative, an endeavor that will outlive him as an enduring contribution to the search for peace in the region.  At home, King Abdullah's vision was dedicated to the education of his people and to greater engagement with the world."

The Truth About The Monetary Stimulus Illusion

Since its inception in 2008, easy monetary policy has created very few positive effects for the real economy — and has created considerable (and in some cases unforeseen) negative effects as well. The BIS warns of financial bubbles. While economic policymakers should take a closer look at Japan, China, and yes, the United States, when debating the limits of monetary stimulus and the dangerous nature of financial bubbles; sadly, the discussion is happening too late to be anything more than an intellectual exercise.

The Only Road Out Of Davos

After 6+ years of deepening poverty and rising stock markets, of creative accounting, of QE and ultra-low interest rates, of extend and pretend and outright propaganda and of what have you, all of which have led us to where we are today, facing yet more rounds of stumbling from crisis into multiple crises, it would seem clear that the model, if not the mold, is broken. In order to fix it, let alone replace it altogether, we need to understand to what extent it is broken. And to do that, we first need to know what exactly the model is. However, the rich-and-powerful in Davos believe in one model only, the one of ever increasing centralization and globalization, because that’s the model that got them where they are.

The "Deflationary Vortex": Global Dollar Economy Suffers Biggest Plunge Since Lehman, Down $4 Trillion

One of the macroeconomic observations that has gotten absolutely no mention in recent months is the curious fact that while global economic growth has not imploded in recent quarters, it is because GDP has been represented, as is customary, in local currency terms. Of course, this comes as a time when local currencies (at least those which are not the USD) have been plunging against the greenback on the back of the expectations that the Fed will hike rates some time in the summer or later in 2015. Which also means that in "dollar economy" terms, i.e., converted in USD, things are not nearly as good.  In fact, as the chart below shows, the global dollar economy is not only shrinking fast, but it is doing so at the fastest pace since the Lehman collapse, having lost a whopping $4 trillion, or a whopping 5% drop,  in just the last 6 months!