What we do know is that the eurodollar system is failing and we know how it is failing. From negative swap spreads to the shrunken, depressed money and credit curves, they all spell out the death of the current standard. The money supply, for lack of a more appropriate term in the “dollar’s” universe, is in the long run converging with the shriveled economic baseline. The immediate problem for our current circumstances is that we don’t yet have any idea what that foundation might look like even now- how far is down.
"People [are] saying that we can't make a go of it and mail the keys to the bank. In the big cities, not so much because the average sale prices haven't really dropped much, we haven't seen the pain yet. But Calgary is getting pretty tight."
At a printing factory in the western city of Chongqing, a Reuters reporter was present when a local official visited last week to make sure the boss paid his workers before the Year of the Monkey begins. The official declined to speak with Reuters, although the boss later said it was an attempt to prevent unrest. "That's what the government is most fearful of," said the factory owner, who did not want to be named.
There is no productivity mystery, only a distinct and illegitimate lack of curiosity on the part of economists to simply take the Establishment Survey as gospel regardless of how little it fit the rest of the world. It also calls into question the legitimacy of the FOMC and monetary policy that was certainly subject to, and predicated upon, the same quackery. No matter how little the payroll reports described the economy as it was, including the relation to GDP, they held on to nothing else to instead deny everything.
"Why after several decades of 0% rates has the Japanese economy failed to respond? Why has the U.S. only averaged 2% real growth since the end of the Great Recession? “How’s it workin’ for ya?” – would be a curt, logical summary of the impotency of low interest rates to generate acceptable economic growth worldwide. "
Don’t look now, but the infamous "Alt-As" are making a comeback thanks to “big money managers including Neuberger Berman, Pacific Investment Management Co. and an affiliate of Blackstone Group LP [who] are lobbying lenders to make more of these “liar’ loans—or even buying loan-origination companies to control more of the supply themselves,” WSJ reports.
To an economist, the economy can bear no recession. In times of heavy central bank activity, an economy can never be in recession. Those appear to be the only dynamic factors that drive economic interpretation in the mainstream. And they become circular in the trap of just these kinds of circumstances – the economy looks like it might fall into recession, therefore a central bank acts, meaning the economy will avoid recession; thus there will never be recession. The risks are all still there, and economists are still determined to downplay if not miss them entirely.
Hong Kong home prices tumbled the most since July 2013, and after a 12 year upcycle, prices are now down a whopping 10% from the recent peak four short months ago. But not only has the Hong Kong housing bubble burst, it has done so in spectacular fashion: as quoted by the SCMP, the local Centaline Property Agency estimates that total Hong Kong property transactions in January were on track to register the worst month since 1991, when it started compiling monthly figures. In other words, the biggest drop in recorded history!
"I don’t want to invest in stocks because they’re crazy and real estate is a solid, safe investment."
Europe’s biggest lender HSBC will no longer provide mortgages to some Chinese nationals who buy real estate in the United States, a policy change that comes as Beijing is battling to stem a swelling crowd of citizens trying to get money out of China. However, ass HSBC closes the door, the panicking Bank of Canada scrapped its C$1.25 million cap on mortgages to borrowers with no local credit history (to tap into surging demand for financing from wealthy immigrant buyers).
... Rothschild’s Penney wrote that the U.S. “is effectively the biggest tax haven in the world.” The U.S., he added in language later excised from his prepared remarks, lacks “the resources to enforce foreign tax laws and has little appetite to do so.”
The first real signs that the global luxury home price bubble had popped emerged last fall in the world’s capital of oligarch money laundering: London. Since then, we have seen weakness in high end Manhattan real estate, but the trend has now spread and is starting to make itself apparent all over the place.
China's demand for gold is back: as China's equities slumped and its yuan currency finished 2015 with a record yearly loss, "people looked at other investment alternatives that's why there was huge demand for gold," said Brian Lan, managing director at gold dealer GoldSilver Central in Singapore.
While energy E&P companies were dropping like flies in 2015, credit rating agencies and banks have remained awfully quiet....
Critics of today’s fiat currency/fractional reserve banking world have (for what seems like forever) made the common sense point that when debt rises faster than cash flow, bad things are bound to happen. In every cycle since 1980 this has been dismissed by the vast majority who benefit from inflating bubbles - until the bubble bursts. And here we go again.