On Tuesday, it was announced that over seventeen million new vehicles were sold in 2015, the highest it’s ever been in United States history. While the media claims that this record has been reached because of drastic improvements to the US economy, they are once again failing to account for the central factor: credit expansion. The auto bubble has yet to burst, but its negative effects are already starting to gradually appear.
Some very troubling charts for the stock bulls to consider.
"It’s no secret that Alberta’s economy is closely linked to the peaks and craters of oil prices—nominal GDP (not adjusted for inflation) swings in tandem with crude prices. It’s why Fort McMurray is like a wounded beast these days. MacKay’s neighbour got laid off this fall. “I watched the bank come and take his truck,” he recalls—it was that or not feed the kids."
All we can do is point out the risks, so that people can at least prepare on an individual level. A major lesson everybody should take to heart from the Cyprus experience is this: when the next crisis strikes, do not believe any of the promises uttered by government or central bank officials. You will be lied to in the critical moments, and you could stand to lose a lot if you believe the lies.
Look out Stefan Ingves, the 2 and 20 crowd smells blood: "The market seems eager to challenge the Riksbank and there are rumors that many foreign hedge funds are long kronor and see a weakening of the krona after a possible intervention as a good buying opportunity.”
The reckless herd has been in control for the last few years, but their recklessness is going to get them slaughtered. Corporate profits are plunging. Labor participation continues to fall. A global recession is in progress. The strong U.S. dollar is crushing exports and profits of international corporations. Real household income remains stagnant, while healthcare, rent, home prices, education, and a myriad of other daily living expenses relentlessly rises. The world is a powder keg, with tensions rising ever higher in the Middle East, Ukraine, Europe, and China. The lessons of history scream for caution at this moment in time, not recklessness. 2016 will be a year of reckoning for the reckless herd.
While the market might have been disappointed by the ECB’s “underdelivery in December, it came as a relief for the Riksbank, the SNB, the Norges Bank, and the Nationalbank who are effectively forced to cut each time the ECB eases or risk seeing upward pressure on their respective currencies. That dynamic has led to a veritable race to the Keynesian bottom with Norway as the last man standing in terms of conducting monetary policy with rates above zero. As we enter the new year, a number of questions remain regarding Europe's headlong plunge into NIRP-dom.
As we move into winter, darkness has fallen up on us. Oil, ca. 65% of the nation’s economy, will not see the required $70 barrel anytime soon. American innovation, once again, turns a scarce resource into an abundant commodity. Despite optimistic Norwegian media articles, the potential for $20 per barrel looms. Production overwhelms demand while inventories rise to record highs. Although, still considered the best place to live, the cracks, in the oil based economy, are forming.
The last two years rents have been rising primarily due to supply and demand issues.
"We are right back at it: trying to stimulate growth through easy money. It hasn’t worked, but it’s the only tool the Fed’s got. The biggest hope I had was that we would enter a new era of personal responsibility. Instead, we doubled down on blaming others, and this is long-term tragic..."
This is what happens when the Fed’s academic-based nonsense collides with economic realities: perversions of capital that lead to massive bubbles and eventually even more massive crises.
The world didn’t completely fall apart in 2015, but it is undeniable that an immense amount of damage was done to the U.S. economy. So don’t be fooled by all the happy talk coming from Barack Obama and the mainstream media. When you look at the cold, hard numbers, they tell a completely different story. The following are 58 facts about the U.S. economy from 2015 that are almost too crazy to believe...
China Proposes A Fix For Its Crashing Housing Market: "Transplant" 100 Million Farmers Into Its CitiesSubmitted by Tyler Durden on 12/24/2015 08:46 -0400
There is just one very big problem with this "solution"...
This Is Canada's Depression: Surging Crime, Soaring Suicides, Overwhelmed Food Banks "And The Worst Is Yet To Come"Submitted by Tyler Durden on 12/24/2015 00:44 -0400
The news out of Canada - and especially out of Alberta, the heart of the country's oil patch - has just gone from disturbing to downright terrifying.
"This is a dangerous movie for Wall Street, the government, and the establishment in general. ... cuts through the crap and reveals those in power to be corrupt, greedy weasels who aren’t really as smart as they want you to think they are. The finale of the movie is sobering and infuriating."