http://www.zerohedge.com/fullrss2.xml/article/article/ww.icecapassetmanagement.com en These "Everyday Americans" Endorse Hillary http://www.zerohedge.com/news/2015-04-18/these-everyday-americans-endorse-hillary <p>Presented with no comment...</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_hookhill.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_hookhill_0.jpg" width="600" height="350" /></a></p> <p>&nbsp;</p> <p><a href="https://twitter.com/FoxBusiness/status/589209328319537155/photo/1"><em>Source: FOX Business</em></a></p> http://www.zerohedge.com/news/2015-04-18/these-everyday-americans-endorse-hillary#comments Fox Business Sat, 18 Apr 2015 20:30:43 +0000 Tyler Durden 504979 at http://www.zerohedge.com World Ponders Life After US Hegemony http://www.zerohedge.com/news/2015-04-18/world-ponders-life-after-us-hegemony <p>Over the past several months, we’ve argued that between the <a href="http://www.zerohedge.com/news/2015-02-07/death-petrodollar-was-finally-noticed">collapse of petrodollar</a> mercantilism and the rise of a China-led, yuan-influenced multinational development bank, the days of dollar hegemony are likely numbered. The implications of the shift away from a global economic order that has prevailed since the end of WWII are far reaching and may include the demise of what has largely been a unilateral political and economic order characterized by the dominance of US foreign policy and Western notions of politics and capitalism. <strong>Now, it appears as though de-dollarization and the end of US hegemony may have gone viral. As The NY Times reports, a US “retreat” from the world order it has largely shaped was the unspoken topic de jour at this year’s spring meeting of the IMF and World Bank in Washington.&nbsp;</strong></p> <p><span style="font-size: 1em; line-height: 1.3em;">Via <a href="http://www.nytimes.com/2015/04/18/business/international/at-global-economic-gathering-concerns-that-us-is-ceding-its-leadership-role.html?ref=business&amp;_r=1&amp;assetType=nyt_now">NY Times</a>:</span></p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>The spring meetings of the International Monetary Fund and World Bank have filled Washington with motorcades and traffic jams and loaded the schedules of President Obama and Treasury Secretary Jacob J. Lew. But they have also highlighted what some in Washington and around the world see as a United States government so bitterly divided that it is on the verge of ceding the global economic stage it built at the end of World War II and has largely directed ever since.</em></p> <p>&nbsp;</p> <p><em>“It’s almost handing over legitimacy to the rising powers,” Arvind Subramanian, the chief economic adviser to the government of India, said of the United States in an interview on Friday. “People can’t be too public about these things, but I would argue this is the single most important issue of these spring meetings.”</em></p> <p>&nbsp;</p> <p><em>Other officials attending the meetings this week, speaking on the condition of anonymity, agreed that the role of the United States around the world was at the top of their concerns.</em></p> </blockquote> <p>There’s no question that The White House has had a difficult time projecting a unified front of late. Between Israel’s attempt to <a href="http://www.zerohedge.com/news/2015-03-24/spy-vs-spy-obama-spies-netanyahu-discovers-netanyahu-spying-obama">foment discord</a> in Congress amid nuclear talks between US and Iranian officials and Washington’s abject failure to convince its allies to refrain from joining the newly formed <a href="http://www.zerohedge.com/news/2015-03-25/us-hegemony-dollar-dominance-are-officially-dead-china-scores-overwhelming-victory-b">Asian Infrastructure Investment Bank</a>, it certainly appears as though the US government faces a fractious relationship not only between its two dominant political parties, but between itself and its external allies as well, and this is serving to undercut its ability to preserve America’s traditionally dominant position on the world stage. There’s perhaps no better example of this than the failure to make changes to the structure of the IMF, an institution which will now face a Chinese rival in the AIIB that could, given enough time, rise to become one of the world’s foremost multinational institutions:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>Washington’s retreat is not so much by intent, Mr. Subramanian said, but a result of dysfunction and a lack of resources to project economic power the way it once did. Because of tight budgets and competing financial demands, the United States is less able to maintain its economic power, and because of political infighting, it has been unable to formally share it either.</em></p> <p>&nbsp;</p> <p><em><strong>Experts say that is giving rise to a more chaotic global shift, especially toward China, </strong>which even Obama administration officials worry is extending its economic influence in Asia and elsewhere without following the higher standards for environmental protection, worker rights and business transparency that have become the norms among Western institutions…</em></p> <p>&nbsp;</p> <p><em>An overhaul of the I.M.F.’s governance structure, negotiated five years ago in large part by President Obama to give China and other emerging powers more authority commensurate with their growing economic strength, has languished in Congress. That, in part, propelled China to create its own multilateral lending institution in direct competition with the behemoths in Washington.</em></p> <p>&nbsp;</p> <p><strong><em>And as we’ve argued exhaustively, the AIIB represents far more than a competing infrastructure lender. It represents the ascendancy of Chinese foreign policy and also ushers in a new era wherein the yuan charts a gradual course towards reserve currency status.</em></strong></p> <p>&nbsp;</p> <p><em>For much of Washington and the world’s economic leaders, China’s creation of the Asian Infrastructure Investment Bank crystallized the choice policy makers face. Earlier this month, Lawrence Summers, who was a top economic adviser for both President Bill Clinton and Mr. Obama, declared that China’s establishment of a new economic institution and Washington’s failure to keep its allies from joining it signaled “the moment the United States lost its role as the underwriter of the global economic system.”</em></p> <p>&nbsp;</p> <p><em>For years, China had threatened to establish institutions to rival those dominated by the West, like the I.M.F., World Bank and Asian Development Bank — or even to establish its currency, the renminbi, as a reserve currency to rival the dollar.</em></p> </blockquote> <p>But even as the some observers describe the situation as a “withdrawal” by the US from the world stage, it may indeed be that Washington has simply lost its legitimacy after years of foreign policy “missteps” that have now culminated in multiple <a href="http://www.zerohedge.com/news/2015-03-23/us-loses-500-million-weapons-given-yemen-now-al-qaeda-hands">proxy</a> wars across the Middle East and after mishandling China’s rise to superpower status by painting Beijing as a quasi-threat rather than adapting to a changing world order in a way that secured US interests while demonstrating an ability to respond appropriately to a changing geopolitical landscape. </p> <p>Whatever the case, the effect has been to undercut Washington’s traditionally dominant role in the financial and political affairs of the world and has, for better or worse, opened the door for other powerful actors to try their hand at shaping the course of history unencumbered by the weight of an overbearing Western hegemon. We're seeing this play out both in Europe — where Russia's Vladimir Putin is not only looking to reshape borders but also to serve as a <a href="http://www.zerohedge.com/news/2015-04-18/greek-white-knight-emerges-putin-give-athens-%E2%82%AC5-billion-advance-gas-pipeline-fees">lender of last resort</a> to Greece — and also in Asia — where, even amid decelerating economic output, Beijing has been agressive in projecting both economic and military prowess over the past several months. Meanwhile, the consequences of US foreign policy continue to materialize in the form of failed or nearly-failed states, and so at the end of the day we'll leave it to readers to decide if the new world order is preferable to its predecessor.&nbsp;</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="611" height="239" alt="" src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/DollarTeaser.png?1429386169" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/world-ponders-life-after-us-hegemony#comments China Greece India International Monetary Fund Middle East Obama Administration President Obama Renminbi Reserve Currency Transparency Vladimir Putin White House World Bank Yuan Sat, 18 Apr 2015 20:00:00 +0000 Tyler Durden 504988 at http://www.zerohedge.com 2007 All Over Again? Let Us Count The Ways (And Remember What Happened Then) http://www.zerohedge.com/news/2015-04-18/2007-all-over-again-let-us-count-ways-and-remember-what-happened-then <p><a href="http://dollarcollapse.com/credit-bubble-2/2007-all-over-again-let-us-count-the-ways-and-remember-what-happened-then/"><em>Submitted by John Rubino via Dollar Collapse blog</em></a>,</p> <p>There&rsquo;s a journalistic sub-genre that might be called &ldquo;The Highest/Lowest Since XXX,&rdquo; in which a reporter takes a current statistic and illustrates (often with snazzy charts) how it hasn&rsquo;t been this high or low since some date in the distant past. This is a compelling theme, implying as it does that the connection between now and then makes the current situation more important or meaningful while providing context with which to judge current trends.</p> <p><strong>Unfortunately, these articles often miss the point of the whole context thing by not exploring what subsequently happened last time the stat in question hit that level</strong>. Here&rsquo;s a good recent example from Bloomberg:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><h2><u><a href="http://www.bloomberg.com/news/articles/2015-04-16/for-the-first-time-since-2007-most-americans-feel-good-about-money" target="_blank">For the First Time Since 2007, Most Americans Feel Good About Money</a></u></h2> <p>For the first time since 2007, more than half of Americans, 52 percent, say their financial situation is &ldquo;getting better,&rdquo; a new Gallup poll shows. That&rsquo;s up from a low of 29 percent three years ago.</p></blockquote> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p data-spx-slot="1"><a href="http://dollarcollapse.com/credit-bubble-2/2007-all-over-again-let-us-count-the-ways-and-remember-what-happened-then/attachment/americans-finances/" rel="attachment wp-att-7406"><img alt="American's finances" class="aligncenter size-full wp-image-7406" height="550" src="http://dollarcollapse.com/wp-content/uploads/2015/04/Americans-finances.jpg" width="563" /></a></p> <p>&nbsp;</p> <p>A third of Americans still say their finances are getting worse, Gallup says. But that&rsquo;s a big improvement from the poll&rsquo;s 2008 peak, when 49 percent of respondents said things were going south.</p> <p>&nbsp;</p> <p>Millennials are the most optimistic of any group in the survey. Seventy percent of 18-to-29-year-olds say their financial picture is improving, up from 60 percent last year. Meanwhile, just 33 percent of those 65-plus are feeling better.</p> <p>&nbsp;</p> <p>Not surprisingly, the wealthier you are, the better you feel. Of those making $75,000 or more, 65 percent say they&rsquo;re doing better. For those earning less than $20,000, the number is 36 percent, though that&rsquo;s up 7 points from last year.</p> <p>&nbsp;</p> <p>The reasons for the improving mood include a rising stock market, falling debt levels, and a better job market.</p> </blockquote> <p><strong>What&rsquo;s amazing about this article from an analytical standpoint is that while mentions in passing that the 2007 high in good feelings was followed by a low in 2008, it doesn&rsquo;t connect the two numbers. </strong>This, it would seem, is the key piece of the puzzle: if the stat matters enough to be article-worthy, then a discussion of why it matters should be mandatory. And if its previous high was followed by a catastrophic low, the reason for this reversal should be the story&rsquo;s narrative center.</p> <p>So here&rsquo;s what it means:<u><strong> Extreme optimism &mdash; whether in the form of stock valuations, consumer spending, or happiness surveys like the one mentioned here &mdash; tend to be followed by corrections because to get to an extreme point in a data series, extreme behavior is usually required.</strong></u> That is, a lot of really optimistic investment decisions have to be made to push financial markets to cyclical highs, and these kinds of moves tend to exhaust themselves and produce big moves in the other direction. Hence the 2008 low following the 2007 high.</p> <p>If reporters got this, and asked the two obvious questions <em><strong>&ldquo;what happened next and why did it happen?&rdquo;</strong></em> these articles would contain a lot more useful information. But of course they also wouldn&rsquo;t lead readers to borrow, spend and speculate, which seems to be the overall goal.</p> <p><strong>And while we&rsquo;re on the subject of reporters not getting life&rsquo;s cyclicality, </strong>check this out:</p> <blockquote><div class="quote_start"><div></div></div><div class="quote_end"><div></div></div><p><u><strong><a href="http://www.bloomberg.com/news/articles/2015-04-17/wall-street-s-2007-heroes-ascendant-as-goldman-blackstone-surge" target="_blank">Wall Street&rsquo;s 2007 Heroes Ascendant as Goldman, Blackstone Surge</a></strong></u></p> <p>&nbsp;</p> <p>Goldman Sachs Group Inc. and Blackstone Group LP were the toast of Wall Street in 2007 as they raised record-setting funds and earned returns of more than 30 percent. Eight years later, they captured some of that dominance again in the first quarter.</p> <p>&nbsp;</p> <p>Goldman Sachs rode a rare increase in trading and more than $1 billion of gains from equity investments made with its balance sheet to post the highest earnings per share in five years. Blackstone, the largest alternative-asset manager, doubled first-quarter profit to a record.</p> <p>&nbsp;</p> <p>Commercial banks&rsquo; margins remained squeezed by interest rates near record lows, leading to Wells Fargo &amp; Co.&rsquo;s first profit drop since the global credit crunch of 2008. Goldman Sachs&rsquo;s return on equity, boosted by its highest post-crisis merger advisory revenue, topped Wells Fargo&rsquo;s for the second time in the last four years.</p> <p>&nbsp;</p> <p>&ldquo;This quarter, they got some cyclical strength,&rdquo; said Alison Williams, senior financials analyst with Bloomberg Intelligence. &ldquo;The pick-up shows the opportunity still in these businesses, and supports the view that at the depths of last year, at least some of the weakness was cyclical.&rdquo;</p> <p>&nbsp;</p> <p>After posting losses in multiple years in the wake of the financial crisis, Blackstone has made steady progress culminating in last quarter&rsquo;s record profit. It has benefited from the increased regulation on banks, entering new businesses and buying assets from financial firms.</p> <p>&nbsp;</p> <p>Blackstone also gained from the rebound in the U.S. property market, as the real estate group reported a 99 percent jump in profit from a year earlier. Its real estate unit, already the biggest of its kind, has raised almost $15 billion in just four months for a new fund.</p> <p>&nbsp;</p> <p>&ldquo;All signs point to 2015 being a very big year for us and our shareholders,&rdquo; CEO Steve Schwarzman, 68, told analysts and investors on a conference call Thursday. &ldquo;I do not believe Blackstone is in any way at a long-term peak.</p> </blockquote> <p>*&nbsp; *&nbsp; *</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="400" height="400" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150418_context.jpg?1429376062" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/2007-all-over-again-let-us-count-ways-and-remember-what-happened-then#comments Cyclicality Gallup Goldman Sachs goldman sachs Real estate Wells Fargo Sat, 18 Apr 2015 19:30:31 +0000 Tyler Durden 504978 at http://www.zerohedge.com Well That Hasn't Happened Before - Exhibit 2 http://www.zerohedge.com/news/2015-04-18/well-hasnt-happened-exhibit-2 <p>We have never, ever, seen the long- and short-end of the Treasury yield curve so <strong>anti-correlated</strong>.</p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_YC.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_YC_0.jpg" width="600" height="314" /></a></p> <p><em>The 2Y and 10Y yields have never been anti-correlated (on a 2-year rolling window) and now are <strong>strongly anti-correlated.</strong></em></p> <p>Day after day we are told that a recession cannot be near since the yield curve is not inverted (a meme we previously destroyed <a href="http://www.zerohedge.com/news/2014-07-09/destroying-recessions-cant-happen-without-yield-curve-inversion-myth">here</a> and <a href="http://www.zerohedge.com/news/2015-03-25/feds-artificial-steepening-yield-curve">here</a>) and while the current 2s10s curve is near 7-year flats/lows; <strong>with ZIRP the yield curve's signaling ability has been diminished greatly.</strong></p> <p>The apparent collapse of the yield curve's internal relationship seems predicated on the <strong>myth of a 'strong US economy'</strong> driving up short-term rates on every jawbone by The Fed, and the reality of global deflation, liquidity squeezes, and debt saturation that is weighing on economic growth prospects, <strong>structurally weighing on long-term rates</strong>.</p> <p>&nbsp;</p> <p><em>Chart: Bloomberg</em></p> <p>*&nbsp; *&nbsp; *</p> <p><a href="http://www.zerohedge.com/news/2015-04-17/well-thats-never-happened-exhibit-1"><em>See Exhibit 1 here</em></a></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="953" height="498" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150418_YC.jpg?1429374523" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/well-hasnt-happened-exhibit-2#comments 2s10s 2s10s 2s10s. Reality Recession Yield Curve Sat, 18 Apr 2015 18:45:55 +0000 Tyler Durden 504977 at http://www.zerohedge.com A MiDSuMMeR NiTe'S SCReaM... http://www.zerohedge.com/news/2015-04-18/misummer-nites-scream <p style="text-align: center;"><iframe src="https://www.flickr.com/photos/expd/16564567143/player/" width="1024" height="615" frameborder="0"></iframe></p> http://www.zerohedge.com/news/2015-04-18/misummer-nites-scream#comments Sat, 18 Apr 2015 18:24:00 +0000 williambanzai7 504984 at http://www.zerohedge.com Did Germany Secretly Fund Israel's Nuclear Weapons? http://www.zerohedge.com/news/2015-04-18/did-germany-secretly-fund-israels-nuclear-weapons <p><a href="http://nationalinterest.org/blog/the-buzz/did-germany-secretly-fund-israels-nuclear-weapons-12658"><em>Submitted by Rebecca Miller via The National Interest</em></a>,</p> <p>The conservative German daily Die Welt, well-known for its unflinching support for Israel, recently <a href="http://www.welt.de/print/wams/politik/article139419592/Aktion-Geschaeftsfreund.html">published an article</a> stating <strong>&ldquo;with near certainty&rdquo; that the Federal Republic of Germany, or West Germany, helped finance Israel&rsquo;s nuclear program in the 1960s.</strong></p> <p>According to the Welt report, in 1961<strong> West Germany agreed to loan $500 million to Israel over ten years</strong>. Although the official purpose of this funding was said to be the development of the Negev Desert&mdash; where Israel&rsquo;s Dimona nuclear reactor is located&mdash; it is <strong>widely suspected that the money was actually meant to finance Israel&rsquo;s nuclear weapons program.</strong></p> <p>This agreement was reportedly hatched during a 1960 meeting between then-Israeli Prime Minister David Ben-Gurion and German Chancellor Konrad Adenauer at the Waldorf Astoria hotel in New York City.<strong> Franz Josef Strauss, a former West German defense minister, <a href="http://www.spiegel.de/international/world/israel-deploys-nuclear-weapons-on-german-built-submarines-a-836784-2.html">previously claimed </a>Ben Gurion and Adenauer discussed Israel&rsquo;s nuclear weapons program during a meeting in Paris in 1961.</strong></p> <p><strong>This top secret initiative was reportedly named &ldquo;Aktion Geschäftsfreund,&rdquo; which translates as &ldquo;Operation Business Partner.&rdquo;</strong> It bypassed both the Israeli cabinet and the German parliament, with the money being funneled through Kreditanstalt für Wiederaufbau, a West German-government owned development bank.</p> <p>The Welt report comes after<strong> former Israeli President Shimon Peres (who was the head of Israel&rsquo;s nuclear-weapons program at the time of its inception in the 1950s) <a href="http://www.telegraph.co.uk/news/worldnews/europe/germany/11535629/West-Germany-secretly-funded-Israels-nuclear-bomb-despite-Israel-denials.html">denied that funding for Israel&rsquo;s nukes came from Germany</a> earlier this month.</strong></p> <p>The Welt article dismissed this denial, however, arguing that when it comes to German-Israeli cooperation on nuclear weapons,<strong> secret-keeping is part of the game.</strong> (Indeed, the practice&mdash;or art, rather&mdash;of secret-keeping with regards to sensitive matters of defense should be expected of any regime, nuclear or otherwise.)</p> <p><strong>Israel first began constructing a nuclear reactor in the Negev Desert near a town called Dimona in the 1950s.</strong> U.S. intel revealed the existence of the Dimona reactor in 1960 (although the U.S. <a href="http://www.politico.com/magazine/story/2015/04/israel-nuclear-weapons-117014.html?ml=po#.VTATeJTF-aY">knew of the reactor much sooner</a>, new archival releases show). This prompted a statement by Prime Minister Ben Gurion that the reactor was purely for non-military purposes. Hardly anyone in the international community believed this was its true function.</p> <p><strong>Peres has stated that $40 million of Israeli government funding was going toward the Dimona reactor, but that this was only half of the amount necessary to complete the project.</strong> This prompted questions about where the other half of the money was coming from. Peres&rsquo; statement, according to Welt, is the only one that indicated that international donors contributed funds to the program (although it has since been revealed that some private American citizens helped fund the program).</p> <p><strong>The suspicion that West Germany was involved in financing Dimona first emerged when Ben Gurion made a background comment to an Israeli newspaper</strong> that a confrontation with Adenauer&rsquo;s government would disrupt the development of Israel&rsquo;s nuclear deterrent, which was integral to Israel&rsquo;s security and the prevention of future wars.&nbsp;</p> <p>Still, <strong>whatever the West German involvement was in Israel&rsquo;s nuclear weapons acquisition, it is undeniable that France played the largest role of any foreign power. </strong>In 1957, following the Suez Crisis, Peres and representatives from France signed three confidential contracts that allowed France to establish a 24-megawatt heavy-water reactor in Israel, loan it 385 tonnes of natural uranium, work together with Israel on nuclear-weapons research and production and back the building of a processing plant for plutonium extraction. This came a year after Peres asked French defense minister Maurice Bourges-Maunoury: &ldquo;What would you think if Israel were to establish its own potential for retaliation?&rdquo;</p> <p><strong>Norway also provided Israel with 20 tons of heavy water,</strong> which was actually delivered by the United Kingdom.</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="639" height="580" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150418_germany.jpg?1429373219" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/did-germany-secretly-fund-israels-nuclear-weapons#comments France Germany Israel New York City Newspaper Norway United Kingdom Uranium Sat, 18 Apr 2015 18:00:58 +0000 Tyler Durden 504976 at http://www.zerohedge.com Chicago Credit Risk Soars On Rahm Emanuel's Re-Election http://www.zerohedge.com/news/2015-04-18/chicago-credit-risk-soars-rahm-emanuels-re-election <p>It appears the <strong>re-election of Rahm Emanuel as Chicago Mayor has done nothing to assuage concerns about the city's insolvency</strong>. As Emanuel's victory became more assured, credit risk (measured by the spread between Chicago Muni yields and Treasury yields) has soared from 180bps to over 240bps. </p> <p>&nbsp;</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_chicago.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_chicago_0.jpg" width="600" height="383" /></a></p> <p><em style="line-height: 20.7999992370605px;">Chart: Bloomberg</em></p> <p>Furthermore, it has accelerated even more since the April 7th election. Recent statements by S&amp;P that <strong><em>if the city fails to articulate &amp; implement a plan by the end of 2015 to sustainably fund pension contributions, or if it substantially draws down reserves to fund contributions, they will likely lower the rating</em></strong>; has not helped (given that Moody's already have Chicago at Baa2 - <strong>just 2 notches above junk</strong>).</p> <p><a href="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_chicago1.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/04/20150418_chicago1.jpg" width="600" height="757" /></a></p> <p><em style="line-height: 20.7999992370605px;">Chart: The Economist</em></p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="703" height="449" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150418_chicago.jpg?1429372581" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/chicago-credit-risk-soars-rahm-emanuels-re-election#comments Rahm Emanuel The Economist Sat, 18 Apr 2015 17:15:52 +0000 Tyler Durden 504975 at http://www.zerohedge.com Has The Fed Already Lost? http://www.zerohedge.com/news/2015-04-18/has-fed-already-lost <p><a href="http://www.peakprosperity.com/blog/92345/has-fed-already-lost?utm_source=twitterfeed&amp;utm_medium=twitter&amp;utm_campaign=Feed%3A+PeakProsperity+%28Peak+Prosperity%29"><em>Submitted by Brian Pretti via PeakProsperity.com</em></a>,</p> <div class="content clearfix"> <p><strong>Increasingly we live in a world of <em>Now</em>. Instantaneous access to digital real time data and news has simply become a given in our lives of the moment.</strong></p> <p>You may be surprised to know that the Federal Reserve has taken notice.</p> <h2><u>GDPNow</u></h2> <p>To the point, GDP data that routinely comes to us from the US Bureau of Economic Analysis (BEA) arrives after the fact. From the perspective of the financial markets and investors -- who are always looking ahead and trying to discount the future -- GDP data is &ldquo;yesterday&rsquo;s news.&rdquo; Moreover, revisions to quarterly GDP can come to us three months after the original data release (with final revisions sometimes years later), essentially becoming an afterthought in terms of relevance to decision making.</p> <p>Recently the Atlanta Federal Reserve has developed what they term a GDPNow model. This model essentially mimics the methodology used by the BEA to estimate real GDP growth. The GDPNow forecast is constructed by aggregating statistical model forecasts of the 13 subcomponents that comprise the BEA&rsquo;s GDP calculation.</p> <p>Private forecasters of GDP, such as the Blue Chip Consensus, use similar approaches to &ldquo;forecast&rdquo; GDP growth. &nbsp;These forecasts are usually updated monthly or quarterly, but many are not publicly available, and many do not specifically forecast the subcomponents of GDP that speak to the character of the top-line number.</p> <p>The Atlanta Fed GDPNow model acts to circumvent these shortcomings. By replicating the key elements of the data used by the Bureau of Economic Analysis, the new Atlanta Fed GDPNow model forms a relatively precise estimate of what the BEA will announce for the previous quarter&rsquo;s GDP prior to its official announcement.&nbsp; For now, the model is still young, but it&#39;s beginning to be discovered more widely among the analytical community.</p> <p>The reason I highlight this new tool to you is that I&rsquo;ve incorporated it into my ongoing top down review of the US economy.&nbsp; More important to &ldquo;here and now&rdquo; thinking is the current reading of this new model.&nbsp; As you can see in the below chart, the current forecast by the Atlanta Fed for Q1 2015 US real GDP growth is 0.1%, up slightly from 0% at quarter end. &nbsp;<strong>As is also clear from the chart, as of the end of the March, Blue Chip Economists were collectively predicting a 1.7% number, quite a differential relative to the Atlanta Fed&#39;s real-time forecast</strong>:</p> <p class="rtecenter"><img alt="" src="http://media.PeakProsperity.com/images/gdpnow-bp1.jpg" /></p> <p class="rtecenter"><em>Chart Source:&nbsp; Atlanta Federal Reserve</em></p> <h2><u>Get Ready For More Economic Weakness</u></h2> <p>Why the sudden drop in the Atlanta Fed&#39;s real-time forecast for Q1 2015 real GDP?</p> <p>As we look at the underlying numbers in the model, we see recent <strong>weakness in personal consumption</strong>. Many had predicted an increase in consumption with lower gasoline prices, but that has not played out, at least not yet. <strong>Weakness in residential and non-residential construction</strong> has also played a part in the downward revision.&nbsp; Weather on the East Coast has not been kind to builders as of late, but that&rsquo;s a seasonal issue easily overcome by sunshine. &nbsp;Also important, <strong>slowing in US exports and equipment orders</strong> meaningfully influenced the March drop-off in the Atlanta Fed model.&nbsp;</p> <p>We know global currencies have been weak, with the highlight over the last six months being the Euro.&nbsp; With a lower Euro, European exports have actually picked up as of late. <strong>The message is clear, the strong dollar is beginning to negatively impact US exports.</strong> I do not see this changing anytime soon.&nbsp; As you know, the importance of relative global currency movements has been a highlight of my discussions over the past half year.</p> <p>Finally, durable goods orders (orders for business equipment) have been soft as of late due specifically to slowing in the domestic energy industry.&nbsp; Again, a trend that is not about to change in the quarters ahead given dampened global energy prices.&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;</p> <p>Like any model, the Atlanta Fed GDPNow model is an estimate. Whether Q1 US real GDP comes in near zero growth remains to be seen, but the message is clear: there is downward pressure on US economic growth singularly. This is set against a backdrop of already-documented slowing in the non-US global economy.</p> <h2><u>What Lies Ahead</u></h2> <p>Perhaps most germane to what lies ahead for investors in 2015 is what the US Fed will do in terms of raising interest rates, or not, if indeed the slowing the Atlanta Fed model predicts materializes. I believe this slowing the Atlanta Fed model shows becomes a real dilemma for the Fed this year and a potential perceptual issue for investors. The Fed has been backed into quite the proverbial corner. A slowing US economy, or otherwise, the Fed is going to need to start raising interest rates for one very important reason.</p> <p>It just so happens that the end of the second quarter of 2015 will mark an anniversary of sorts.&nbsp; It will be six years since the current economic expansion in the US began.&nbsp; As of July, ours will be tied for the fourth longest US economic expansion on record (since the Fed began keeping official track in 1945).&nbsp; There have been 11 economic expansions over this period, so this is no minor feat.&nbsp;</p> <p>The second quarter of this year will also mark the six and a half year point for the US economy operating under the Federal Reserve&rsquo;s zero interest rate policy.&nbsp; You&rsquo;ll remember during the darker days of late 2008 and early 2009, the Fed introduced zero percent interest rates as an emergency monetary measure.&nbsp; It was deemed acceptable as crisis policy.&nbsp; At least as per Fed policy since, the current economic cycle has not only been one of the lengthiest on record, but apparently simultaneously the longest US economic crisis period on record as per the continuation of the crisis zero interest rate policy.&nbsp; As we look ahead, the &ldquo;crisis period&rdquo; in the eyes of the Fed is coming to an end as they contemplate higher short term interest rates.</p> <p>Although it still remains to be seen what the Fed will decide and when, there is one very important consideration that must be entering their interest rate policy decision making at this point in the economic cycle.&nbsp; A consideration they will never speak of publicly.</p> <h2><u>The Key Question From Here</u></h2> <p><strong>At some point, maybe sooner than later, the US economy will re-enter recession. </strong>Historically, that&#39;s the time when the Fed would lower interest rates in attempt to spur economic growth. But today, interest rates are already at 0%. <strong>That&#39;s what&#39;s so dangerous for the Fed about its current ZIRP policy</strong> -- it leaves no gunpowder left in the low-interest-rate bazooka. The Fed will enter its next battle defenseless.</p> <p>This is clearly a situation the Fed wants to avoid, so <strong>raising rates -- soon -- is an urgent priority.</strong> But....practically, can the Fed (and other central banks) really raise rates now without killing the already-moribund global economy?</p> <p>In <a href="http://www.peakprosperity.com/insider/92347/future-interest-rates" target="_blank">Part 2: The Future Of Interest Rates</a>, we delve into the Fed&#39;s dwindling set of options and discuss what the most likely outcomes are, and what their implications will be. Some key questions explored include: could the Fed actually adopt a negative interest rate policy (NIRP), as we&#39;re seeing elsewhere? And: is it already too late for the Fed&#39;s next actions to matter?</p> <p><a href="http://www.peakprosperity.com/insider/92347/future-interest-rates" target="_blank">Click here to read Part 2</a> of this report <em>(free executive summary, <a href="http://www.peakprosperity.com/enroll" target="_blank">enrollment</a> required for full access)</em></p> </div> <p>&nbsp;</p> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="635" height="639" alt="" src="http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/20150418_fed.jpg?1429371580" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/has-fed-already-lost#comments Central Banks Federal Reserve Global Economy Personal Consumption Recession Sat, 18 Apr 2015 16:31:03 +0000 Tyler Durden 504974 at http://www.zerohedge.com A Full Analysis and Step-by-Step Guide for EU Area Residents To Aid In Escaping the Upcoming Bank Bail-ins & Capital Controls http://www.zerohedge.com/news/2015-04-18/full-analysis-and-step-step-guide-eu-area-residents-aid-escaping-upcoming-bank-bail- <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Here come capital controls in Europe. Of that, I have little doubt. Actually, they are already here, both in legislative form and in action. Let's walk through what they are, why they're here, how they got here, and what you can do to avoid them.</p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">What Are Capital Controls?</h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Capital controls are&nbsp;residency-based measures such as&nbsp;<a href="http://en.wikipedia.org/wiki/Financial_transaction_tax" title="Financial transaction tax" style="color: #4c90fe; transition: color 0.2s linear;">transaction taxes</a>, other limits, or outright prohibitions that a nation's government can use to regulate flows from&nbsp;<a href="http://en.wikipedia.org/wiki/Capital_market" title="Capital market" style="color: #4c90fe; transition: color 0.2s linear;">capital markets</a>&nbsp;(money) into and out of the country's&nbsp;<a href="http://en.wikipedia.org/wiki/Capital_account" title="Capital account" style="color: #4c90fe; transition: color 0.2s linear;">capital account</a>. These measures may be economy-wide, sector-specific (usually the financial sector, ex. your bank).&nbsp;</p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">Why Are They Needed By Sovereign Countries?</h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">In&nbsp;<a href="http://veritaseum.com/index.php/homes/1-blog/83-despite-what-you-don-t-hear-in-the-media-it-s-all-out-currency-war-pt-2" style="color: #4c90fe; transition: color 0.2s linear;">Despite What You Don't Hear In The Media, It's ALL OUT (Currency) WAR! Pt. 1</a>, I discussed the "Trilemma", as excerpted:</p> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">According to Wikipedia (and modified by us):</p> <p style="margin: 0.5em 0px 1.5em 60px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><em>The&nbsp;Impossible trinity&nbsp;(also known as the&nbsp;Trilemma) is a&nbsp;<a href="http://en.wikipedia.org/wiki/Trilemma" title="Trilemma" style="color: #4c90fe; transition: color 0.2s linear;">trilemma</a>&nbsp;in&nbsp;<a href="http://en.wikipedia.org/wiki/International_economics" title="International economics" style="color: #4c90fe; transition: color 0.2s linear;">international economics</a>&nbsp;which states that it is impossible to have all three of the following at the same time:</em></p> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"> <li style="list-style-type: none;"> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside;"> <li><em>A&nbsp;<a href="http://en.wikipedia.org/wiki/Fixed_exchange_rate" title="Fixed exchange rate" style="color: #4c90fe; transition: color 0.2s linear;">fixed exchange rate</a>&nbsp;(as attempted&nbsp;<a href="http://veritaseum.com/index.php/homes/1-blog/89-is-the-danish-krona-peg-to-euro-more-fragile-than-glass-beads-the-danish-national-bank-infers-so" style="color: #4c90fe; transition: color 0.2s linear;">and failed by the Swiss</a>&nbsp;and&nbsp;<a href="http://veritaseum.com/index.php/homes/1-blog/89-is-the-danish-krona-peg-to-euro-more-fragile-than-glass-beads-the-danish-national-bank-infers-so" style="color: #4c90fe; transition: color 0.2s linear;">currently and unsustainably by the Danes</a>)</em></li> <li><em>Free&nbsp;<a href="http://en.wikipedia.org/wiki/Capital_(economics)" title="Capital (economics)" style="color: #4c90fe; transition: color 0.2s linear;">capital</a>&nbsp;movement (absence of&nbsp;<a href="http://en.wikipedia.org/wiki/Capital_control" title="Capital control" style="color: #4c90fe; transition: color 0.2s linear;">capital controls</a>), as was the case in Cyprus before March of 2013 when capital controls were introduced</em></li> <li><em>An independent&nbsp;<a href="http://en.wikipedia.org/wiki/Monetary_policy" title="Monetary policy" style="color: #4c90fe; transition: color 0.2s linear;">monetary policy</a>&nbsp;- not capable by anybody in the EU save Germany due to the power of the Troika, yet all but Greece proclaim they are pursuing such.</em></li> </ol> </li> </ol> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><em>It is both a hypothesis based on the&nbsp;<a href="http://en.wikipedia.org/wiki/Uncovered_interest_rate_parity" title="Uncovered interest rate parity" style="color: #4c90fe; transition: color 0.2s linear;">uncovered interest rate parity</a>&nbsp;condition, and a finding from empirical studies where governments that have tried to simultaneously pursue all three goals have failed.&nbsp;</em></p> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><em>The Impossible Trinity or "The Trilemma", in which three policy positions are possible. If a nation were to adopt positiona, for example, then it would maintain a fixed exchange rate and allow free capital flows, the consequence of which would be loss of monetary sovereignty.</em></p> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><em><a href="http://en.wikipedia.org/wiki/File:Impossible_trinity_diagram.svg" style="color: #4c90fe; transition: color 0.2s linear;"><img src="http://upload.wikimedia.org/wikipedia/commons/thumb/d/d8/Impossible_trinity_diagram.svg/350px-Impossible_trinity_diagram.svg.png" width="350" height="242" style="max-width: 100%; height: auto !important;" /></a></em></p> <h3 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 27.2000007629395px; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 30px; font-family: 'Open Sans', Arial, sans-serif;"><span style="font-weight: 600;">Put plainly, either balance sheets get burned trying to buy and sell currencies, capital controls are implemented, or QE (sovereign monetary policy) fails. Trying all three simultaneously has NEVER, EVER worked! Of course, according to the ECB, it's different this time...</span></h3> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;</p> <h4 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 27.2000007629395px; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 22px; font-family: 'Open Sans', Arial, sans-serif;">Guess what? Balance sheets are burned.</h4> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Realize why the ECB is doing this QE thing to the level that it is. Their banks are still in trouble, material trouble. Reference "<a href="http://boombustblog.com/reggie-in-the-news/item/1262" style="color: #ac0000; transition: color 0.2s linear; margin: 0px; padding: 0px; border: 0px; outline: 0px; background: transparent;">Ovebanked, Underfunded, and Overly Optimistic: The New Face of Sovereign Europe</a>" from 5 years ago and tell me if you think its gotten better (Hint: pay very close attention to the countries these banks are domiciled in, capital controls data soon to follow several paragraphs below)...</p> <h2 style="color: #00cccc; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 18px; font-family: 'Open Sans', Arial, sans-serif; border: 0px; outline: 0px; background: transparent;">Sovereign Risk Alpha: The Banks Are Bigger Than Many of the Sovereigns</h2> <h2 style="color: #00cccc; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 18px; font-family: 'Open Sans', Arial, sans-serif; border: 0px; outline: 0px; background: transparent;"><img src="https://s3.amazonaws.com/uploads.hipchat.com/126832/920832/KMUBWSZi5D9Ddhe/thumb_image015.png" style="max-width: 100%; height: auto !important;" /></h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;Well, it's all relative. The banks are smaller, leverage is down - and that's after 6 years of global QE, ZIRP and now NIRP, yet each and every bank is STILL big enough to collapse the country that it's domicled in...</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;<img src="http://veritaseum.com/images/Global_Bank_Risk_as_Determined_by_Veritaseum.jpg" alt="Global Bank Risk as Determined by Veritaseum" width="969" height="1017" style="max-width: 100%; height: auto !important;" /></p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 27.2000007629395px; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">With this in mind, let's review the&nbsp;<span style="font-weight: 600; line-height: 27.2000007629395px;">The&nbsp;Anatomy&nbsp;of a European Bank Run</span><span style="line-height: 27.2000007629395px;">!</span></h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Below is a chart excerpted from our work showing the asset/liability funding mismatch of a French bank. The actual name of the bank is not at issue here. What is at issue is what situation this bank has found itself in and why it is in said situation. Both Lehman and Bear Stearns collapsed from the&nbsp;<span style="font-weight: 600;">EXACT SAME PROBLEM</span>! That problem is asset/Liabitlity mismatch.</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/bankrun_diag.png" alt="bankrun diag" width="762" height="596" style="max-width: 100%; line-height: 27.2000007629395px; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">What many bank depositors who believe their bank deposits are actually cash don't realize is that they are creditors to the bank - short term lenders. You bank accounts, time deposit accounts, CDs, checking and savings accounts are short term, UNSECURED loans to bank that uses said loans to engaged in significantly and materially more risky endeavors to generate profits. What sort of endeavors, you may ask? Well, as was the case with many French, Cypriot, Italian, Spanish and German banks, making real estate, corporate and government loans of a longer term to profligate nations such as Greece, for one. It's good work of you an get it. Borrow from mom and pop savers at 25 basis points and lend to Greece at 23%. Good money, dude!</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/anatomy_of_a_bank_run.png" alt="anatomy of a bank run" width="976" height="795" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">That is, until it becomes apparent that the money you lent Greece isn't going to come back.</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/bankrun_het_map.png" alt="bankrun het map" width="762" height="580" style="max-width: 100%; line-height: 27.2000007629395px; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Even that, in and of itself is not a problem since the fractional reserve banking system doesn't really require you to have the money that you borrowed from mom and pop on&nbsp;hand to pay them all back. It works, until it doesn't. When mom and pop figure out what you've done with their money by reading and article such as this, that's when the stinky brown stuff hits the fan blades. You get a run on the bank as everyone tries to get those overnight, and 1 and 2 month deposits out - at the same time.</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">This is what happened to Bear Stearns and Lehman, literally overnight - although the signs were available months beforehand if you paid attention. I predicted both of these collapses at least 60 days before they occurred:</p> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"> <li> <p style="margin: 0.5em 0px 1.5em;">The collapse of Bear Stearns in January 2008&nbsp;(2 months before Bear Stearns fell, while trading in the $100s and still had buy ratings and investment grade AA or better from the ratings agencies):&nbsp;<a href="http://boombustblog.com/reggie-in-the-news/item/128" title="Permanent Link to Is this the Breaking of the Bear?" style="color: #4c90fe; transition: color 0.2s linear;" rel="bookmark">Is this the Breaking of the Bear?</a>&nbsp;</p> </li> <li>The warning of Lehman Brothers before anyone had a clue!!! (February through May 2008):&nbsp;<a href="http://boombustblog.com/reggie-in-the-news/item/154" title="Permanent Link to Is Lehman really a lemming in disguise?" style="color: #4c90fe; transition: color 0.2s linear;" rel="bookmark">Is Lehman really a lemming in disguise?</a>&nbsp;Thursday, February 21st, 2008 |<a href="http://boombustblog.com/reggie-in-the-news/item/203" title="Permanent Link to Web chatter on Lehman Brothers" style="color: #4c90fe; transition: color 0.2s linear;" rel="bookmark">&nbsp;Web chatter on Lehman Brothers</a>&nbsp;Sunday, March 16th, 2008 (It would appear that Lehman’s hedges are paying off for them. The have the most CMBS and RMBS as a percent of tangible equity on the street following Bear Stearns. The question is, “Can they monetize those hedges?”. I’m curious to see how the options on Lehman will be priced tomorrow. I really don’t have enough. Goes to show you how stingy I am.&nbsp;I bought them before Lehman was on anybody’s radar and I was still to cheap to gorge. Now, all of the alarms have sounded and I’ll have to pay up to participate or go in short. There is too much attention focused on Lehman right now.</li> </ol> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><iframe src="http://www.youtube.com/embed/R6-D1R7fLgc?rel=0&amp;feature=player_embedded&amp;wmode=opaque" width="425" height="350"></iframe></p> <h3 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 27.2000007629395px; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 30px; font-family: 'Open Sans', Arial, sans-serif;">&nbsp;Why are these bank metrics significant?</h3> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Well, the obvious answer is they can collapse the economy of the countries they're domiciled in. The less obvious answer is what sovereign nations are willing to do to prevent that. Hint: It's not significantly reducing the risks of the banks, nearly all of which are larger and more dangerous than they were in 2007! To get the answer, let me refer you to a post made in the bitocintalk.org forum two years ago.</p> <h2 style="color: #2d2d2d; font-weight: 400; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 19.5px; border: 0px; outline: 0px; font-family: Arial, Helvetica, sans-serif; background-image: initial; background-attachment: initial; background-size: initial; background-origin: initial; background-clip: initial; background-position: initial; background-repeat: initial;"><span style="font-weight: 600; margin: 0px; padding: 0px; border: 0px; outline: 0px; background: transparent;"><em style="margin: 0px; padding: 0px; border: 0px; outline: 0px; background: transparent;">First Off Let's Make</em></span>&nbsp;Bank Collapse Real...</h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">To begin with, let's make this Cyprus thing real, by showing a live example of what happens to a real small business that had the gall to bank with Laikie Bank in Cyprus. Look at the timeline of events:</p> <h3 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 30px; font-family: 'Open Sans', Arial, sans-serif;">February 10, 2013: The&nbsp;<a href="http://www.ft.com/intl/cms/s/0/1d17a320-736f-11e2-9e92-00144feabdc0.html#ixzz2OPmvbIKi" style="color: #4c90fe; transition: color 0.2s linear;">Financial Times comes out with an article</a>&nbsp;that is not nearly as detailed and instructive as this one, yet still quite alarming.</h3> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"> <li style="list-style-type: none;"> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside;"> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">A radical new option for the&nbsp;</span><a href="http://www.ft.com/cms/s/0/80320e0e-bed0-11e1-b24b-00144feabdc0.html" target="_blank" title="Cyprus requests eurozone bailout - FT.com" style="color: #2e6e9e; transition: color 0.2s linear;">financial rescue of Cyprus</a><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">&nbsp;<span style="font-weight: 600;">would force losses on uninsured depositors in Cypriot banks</span>, as well as investors in the country’s sovereign bonds, according to a confidential memorandum prepared ahead of Monday’s meeting of eurozone finance ministers.</span></p> <p style="margin: 0px; padding: 0px; color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;"><span style="color: #666666; font-family: Verdana, Arial, Helvetica, sans-serif; font-size: 17px; line-height: 1.6;">...&nbsp;</span>The new plan has not been endorsed by its authors in the European Commission or by individual eurozone members. The memo warns that “<span style="font-weight: 600;">the risks associated with this option are significant</span>”, including a&nbsp;<span style="font-weight: 600;">renewed danger of contagion in eurozone financial markets, and premature collapse in the Cypriot banking sector</span>.</p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">... The radical proposal is<span style="font-weight: 600;">&nbsp;intended to produce a more sustainable debt solution for the countr</span>y, cutting the size of Cyprus’s bailout by two-thirds – from €16.7bn to only €5.5bn – by involving more foreign depositors and bond holders.&nbsp;</span></p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">... By<span style="font-weight: 600;">&nbsp;“bailing in” uninsured bank depositors</span>, it would<span style="font-weight: 600;">&nbsp;also involve more foreign investors</span>...</span></p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;"><span style="font-weight: 600;">Senior EU officials who have seen the document cautioned that imposing losses on bank depositors and a sovereign debt restructuring remain unlikely</span>. Underlining the dissuasive language in the memo, they said that bailing in depositors was never considered in previous eurozone bailouts because of&nbsp;<span style="font-weight: 600;">concern that it could lead to bank runs in other financially fragile countries</span>.</span></p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">But the&nbsp;<span style="font-weight: 600;">document also makes clear that both options remain on the table despite public insistence by eurozone leaders that&nbsp;</span></span><span style="font-weight: 600;"><a href="http://www.ft.com/indepth/greece-debt-crisis" target="_blank" title="Greece debt crisis in depth - FT.com" style="color: #2e6e9e; transition: color 0.2s linear;">Greece</a></span><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;"><span style="font-weight: 600;">&nbsp;was “unique” and would be the only country to default on sovereign debts</span>.</span></p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">Labelled<span style="font-weight: 600;">&nbsp;“strictly confidential” and distributed to eurozone officials last week</span>, the memo says the radical version of the plan – including a “haircut” of 50 per cent on sovereign bonds – would<span style="font-weight: 600;">&nbsp;shrink the Cypriot financial sector, now nearly eight times larger than the island’s economy...</span>&nbsp;[T<em>he charts posted above shows the Bank of Cyprus as a % of GDP is still smaller than Italian, Spanish and British banks. If Cyprus is/was at risk, then logic dictates those areas are even more at risk, no?</em>]</span></p> </li> <li> <p style="margin: 0.5em 0px 1.5em;"><span style="color: #000000; font-family: Arial, Helvetica, sans-serif; font-size: 16px; line-height: 18px;">Cyprus’s bailout, while&nbsp;<span style="font-weight: 600;">small compared to Ireland, Portugal and Greece</span>, has proven unexpectedly difficult because&nbsp;<span style="font-weight: 600;">its size relative to the country’s gross domestic product would increase debt to levels considered unsustainable both by the International Monetary Fund and the German government</span>.</span></p> </li> </ol> </li> </ol> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Here are excerpts from the comments section said article:</p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt;">gntimus&nbsp;Feb 18, 2013</span></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;">It's been a tradition by British media to secreted venom towards Cyprus in order to degrade the island and it's people. These so called secret memorandums and information that the "FT" has been leaking recently are anything but a coincidence. It is obvious to me that the ulterior motive behind there comments are mostly attributable to the Russian Deposits in the island and of course to the huge gas and possibly oil reserves hidden off the south coast of Cyprus within the EEZ. The bureaucrats of Troika are well aware that the revenues from the gas and oil reserves are multiples to the amount required to keep the Cyprus economy afloat, even in the worst case scenario (EUR 17.5 Billion).<span style="font-weight: 600;">&nbsp;So, why would Cyprus need a haircut not just on Government Bonds but also on deposits? (This is outrageous)</span>&nbsp;</span></p> <p style="margin: 0.5em 0px 0.0001pt; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;">&nbsp;</p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt;">philani33&nbsp;Feb 11, 2013</span></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;"><span style="font-weight: 600;">I am amazed that FT is willing to post such articles especially when on the face of the article is clearly says that it has not been endorsed by its authors.</span></span></p> <p></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;">UoMCYstudent&nbsp;Feb 11, 2013</span></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;"><span style="font-weight: 600;">The Foreign Minister of Cyprus has stated early today that this article is not supported by any probable scenario.</span>&nbsp;</span></p> <p style="margin: 0.5em 0px 0.0001pt; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;">&nbsp;</p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt;">a greek&nbsp;Feb 11, 2013</span></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;">Under a shamefully deceiptful title you say this: A not-so-confidential memo that you say you saw examines three theoretical options for the financial rescue of Cyprus. One of them, that would force losses on depositors, was not endorsed even by the memo's authors, or anyone else, presumably it was put among the three as a theoretical example of the impossible. Yet, once it is printed in the FT, it becomes news, all nuance of non-endorsement and impossibility lost.<br />Although its editorials are generally balanced and constructive, the FT has printed thousands of articles trashing the euro since 2009. But this one sets a new record low for deceipt, scaremongering and underestimating the intelligence - nay, the reading ability - of its readers. Our trust is the FT's capital, and you have squandered it.</span></p> <p style="margin: 0.5em 0px 0.0001pt; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;">&nbsp;</p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt;">FionaMullen&nbsp;Feb 11, 2013</span></p> <p style="margin: 0.5em 0px 0.0001pt 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;"><span style="font-size: 12pt; font-family: 'Times New Roman', serif;">@Idalion&nbsp;<span style="font-weight: 600;">Yes they mean expropriation of private money from what should be the safest form of keeping it other than under the mattress. And it doesn't just mean don't keep your money in Cyprus. It means don't keep it in the eurozone</span>,&nbsp;</span></p> <p style="margin: 0.5em 0px 0.0001pt; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: normal;">&nbsp;</p> <h3 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: normal; margin-top: 0px; margin-bottom: 0.0001pt; padding: 0px; font-size: 30px; font-family: 'Open Sans', Arial, sans-serif;">March 25. 2103 (roughly a month and a half later), the Cypriot government accepted a Troika bailout under the conditions it&nbsp;<a href="http://en.wikipedia.org/wiki/2012%E2%80%9313_Cypriot_financial_crisis" style="color: #4c90fe; transition: color 0.2s linear;">confiscate the capital of depositors with accounts over 100,000 euro</a>.</h3> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><span style="line-height: 1.6;">From the&nbsp;</span><a href="https://bitcointalk.org/index.php?topic=160292" target="_blank" style="color: #4c90fe; transition: color 0.2s linear; line-height: 1.6;">Bitcoin forum</a><span style="line-height: 1.6;">&nbsp;I excerpt a post that puts things into perspective, re: bank account confiscation:</span></p> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/http--s12.postimg.org-yt2wefvot-popularbank2.png" alt="http--s12.postimg.org-yt2wefvot-popularbank2" width="783" height="623" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em 30px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><em>Most of the circulating assets on our business Current Account are blocked.&nbsp;</em><em>Over 700k of expropriated money will be used to repay country's debt. Probably we will get back about 20% of this amount in 6-7 years.&nbsp;</em><em>I'm not Russian oligarch, but just European medium size IT business. Thousands of other companies around Cyprus have the same situation.&nbsp;</em><em>The business is definitely ruined, all Cypriot workers to be fired.&nbsp;</em><em>We are moving to small Caribbean country where authorities have more respect to people's assets. Also we are thinking about using Bitcoin to pay wages and for payments between our partners.</em></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><span style="line-height: 1.6;">L</span><a href="http://www.laiki.com/EN/TheBank/Documents/DecreeEN.pdf" style="color: #4c90fe; transition: color 0.2s linear; line-height: 1.6;">aiki Bank&nbsp;</a><span style="line-height: 1.6;">has offered details...</span></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/DecreeEN_Page_1.jpg" alt="DecreeEN Page 1" width="464" height="600" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/DecreeEN_Page_2.jpg" alt="DecreeEN Page 2" width="464" height="600" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/DecreeEN_Page_3.jpg" alt="DecreeEN Page 3" width="464" height="600" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><span style="font-weight: 600;">Let me make this clear. Roughly 50 days, from concept to confiscation of euros. This is not a long drawn out process, it's something that can happen very quickly. Bear Stearns collapsed over the weekend. Laiki Bank had a "bank holiday" weekend. And Lehman... Watch out for those weekends, y'all!</span></p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">Next, Let's Realize That Cyprus Is Not A "Special Case", It Is Like The Template For Future Actions</h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Just the fear of another wave of bank collapse has government officials and regulators in fear. Why are they afraid? I made the cause of such fear clear to all as the Keynote Speaker at the ING Valuation Conference&nbsp;in Amsterdam in 2011.</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><iframe src="http://www.youtube.com/embed/LdGdyEQYoe8?rel=0&amp;feature=player_embedded&amp;wmode=opaque" width="425" height="350"></iframe></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">With the knowledge contained in the video above, it's not hard to see the Infection spreads to North America as&nbsp;<a href="http://boombustblog.com/blog/item/9047-the-canadian-government-offers-bail-in-regime-legalizes-the-confiscation-of-bank-deposits-to-bail-out-banks#comments" target="_blank" style="color: #4c90fe; transition: color 0.2s linear;">The Canadian Government Offers "Bail-In" Regime, Prepares For The Confiscation Of Bank Deposits To Bail Out Banks</a>! Hold on, before you start worrying about your Canadian bank, you should be aware that the EU banks are still much, much, much worse off. Let's forget Cyprus for a minute and look deeper into the EU. This is a tweet from Edward Harrison, the producer of the BoomBust TV show (no relation to BoomBustBlog) and author of Creditwritedowns.com.</p> <blockquote class="twitter-tweet" style="margin: 20px 0px; font-style: italic; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><p style="margin-top: 0.5em; margin-bottom: 1.5em;">Under article 65 of the Treaty on the Functioning of the European Union, member states can impose capital controls&nbsp;<a href="http://t.co/wvB4e25BOv" style="color: #4c90fe; transition: color 0.2s linear;">pic.twitter.com/wvB4e25BOv</a></p> <p>— Edward Harrison (@edwardnh)&nbsp;<a href="https://twitter.com/edwardnh/status/589119790393872384" style="color: #4c90fe; transition: color 0.2s linear;">April 17, 2015</a></p></blockquote> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/EU_Capital_Controls.jpg" alt="EU Capital Controls" width="1000" height="568" style="max-width: 100%; height: auto !important;" /></p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">Governmental Debt Assumed From "Too Big To Fail" Banks Are The Levers of Bail-ins. Liqidity Crises Born From Asset/Liablity Mismatches Are the Impetus&nbsp;</h2> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Look at the government debt to GDP level that caused the Troika to act in the case of Cyprus, re: Capital Controls</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><img src="http://veritaseum.com/images/Coins/Cyprus_euro-area-government-debt-to-gdp.png" alt="Cyprus euro-area-government-debt-to-gdp" width="710" height="325" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><span style="font-size: 12.75px; line-height: 0; position: relative; vertical-align: baseline; top: -0.5em;">Source: T<a href="http://www.tradin/" style="color: #4c90fe; transition: color 0.2s linear;">radin</a><a href="http://www.tradingeconomics.com/" style="color: #4c90fe; transition: color 0.2s linear;">g Economics</a></span></p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">Basically, once you pierce the EU area average AND have an oversized banking industry relative to GDP, expect a HIGH probability of capital controls in the form of a bail-in, etc. The problem is, there are a lot of EU residents and foreign entities that lend unsecured money (in the form of check, savings and demand deposite accounts) that are highly susceptible to getting "Cyprus'd". Check it out:</p> <table style="border-collapse: collapse; border-spacing: 0px; margin-bottom: 20px; width: 699px; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px; height: 4565px;"> <tbody> <tr> <td style="border-bottom-width: 1px; border-bottom-style: solid; border-bottom-color: #e5e5e5; padding: 10px;"> <p style="margin: 0.5em 0px;"><img src="http://veritaseum.com/images/Coins/albania_euro-area-government-debt-to-gdp.png" alt="albania euro-area-government-debt-to-gdp" width="710" height="325" style="max-width: 100%; height: auto !important;" /></p> <p style="margin: 0.5em 0px;"><img src="http://veritaseum.com/images/Coins/Croatia_euro-area-government-debt-to-gdp.png" alt="Croatia euro-area-government-debt-to-gdp" width="710" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Finland_euro-area-government-debt-to-gdp.png" alt="Finland euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/France_euro-area-government-debt-to-gdp.png" alt="France euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Greece_euro-area-government-debt-to-gdp.png" alt="Greece euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Italy_euro-area-government-debt-to-gdp.png" alt="Italy euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Khazikstan_euro-area-government-debt-to-gdp.png" alt="Khazikstan euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Luxemboourg_euro-area-government-debt-to-gdp.png" alt="Luxemboourg euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Netherlands_euro-area-government-debt-to-gdp.png" alt="Netherlands euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Romania_euro-area-government-debt-to-gdp.png" alt="Romania euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Russia_euro-area-government-debt-to-gdp.png" alt="Russia euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Slovakia_euro-area-government-debt-to-gdp.png" alt="Slovakia euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Spain_euro-area-government-debt-to-gdp.png" alt="Spain euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" /><img src="http://veritaseum.com/images/Coins/Ukraine_euro-area-government-debt-to-gdp.png" alt="Ukraine euro-area-government-debt-to-gdp" width="NaN" height="325" style="max-width: 100%; height: auto !important;" />&nbsp;</p> </td> </tr> </tbody> </table> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">If&nbsp;you have money in bank accounts (in other words, you are an unsecured lender) in any of these countries, you literally have a fiduciary responsiblity to yourself to read the remainder of this article.&nbsp;</h2> <h1 style="color: #333333; letter-spacing: -1px; line-height: 1.0416; margin-top: 0px; margin-bottom: 20px; padding: 0px; font-family: inherit; font-style: inherit; font-variant: inherit; border: 0px; vertical-align: baseline;">&nbsp;</h1> <h1 style="color: #333333; letter-spacing: -1px; line-height: 1.0416; margin-top: 0px; margin-bottom: 20px; padding: 0px; font-family: inherit; font-style: inherit; font-variant: inherit; border: 0px; vertical-align: baseline;">Capital Mobility &amp; Banking System Bail-in Protection via Veritaseum "Smart Contracts"</h1> <p style="margin: 0px 0px 20px; font-family: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; color: #121a0d; line-height: inherit; padding: 0px; border: 0px; vertical-align: baseline;">Parties who are domiciled in free flowing capital hostile states that have tight capital controls, ex. China, India, have banned or limited BTC trading by banks and/or individuals can take advantage of Veritaseum contracts to gain multi-currency exposure without violating the law (this is not legal advice, and the counsel of an attorney is strongly recommended).&nbsp;Take note that the systems with the tightest capital controls have been the one’s exhibiting the most aggressive stance to bitcoin. Unfortunately, they don’t seem to understand what Bitcoin is and what it can do. Fortunately for those that seek relief from capital controls, they don't understand what smart contracts can do.</p> <p style="margin: 0px 0px 20px; font-family: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; color: #121a0d; line-height: inherit; padding: 0px; border: 0px; vertical-align: baseline;">Cyprus banks closed on a Friday and announced confiscation of bank assets over the weekend. Veritaseum contracts could have been used to move monetary value outside of the Cyprus banking system assuming the participants had a store of Bitcoin (it is rumored that this is how some of the Russian money was removed over the weekend).&nbsp;</p> <p style="margin: 0px 0px 20px; font-family: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; color: #121a0d; line-height: inherit; padding: 0px; border: 0px; vertical-align: baseline;">Let’s assume a small businessman would like to purchase 150,000 EUR worth of bitcoin, yet is concerned that the BTC volatility may cause more of a loss than the Cypriot capital controls (highly unlikely, since the Cypriot capital controls resulted in 100% losses for large depositors). He buys the BTC then hedges his large BTC position into EUR. He proceeds to do that with a quarter of his monthly cash flows, building up a sizeable, fully hedged position in cyberspace and on the blockchain (thus, effectively offshore as it relates to the legacy bankings system) and outside of the fragile Cyprus banking system.&nbsp;</p> <p style="margin: 0px 0px 20px; font-family: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; color: #121a0d; line-height: inherit; padding: 0px; border: 0px; vertical-align: baseline;">The Cyprus banks pull the trigger to confiscate funds and the Russian bank depositor has significant funds mobile and ready to deliver anywhere in the internet connected world within minutes, even on a Sunday afternoon.&nbsp;</p> <h2 style="color: #333333; font-weight: 400; letter-spacing: -1px; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; font-size: 42px; font-family: 'Open Sans', Arial, sans-serif; background: #fec54c;">How To "Bail-in Proof" Your Money, a Step-by-Step Tutorial</h2> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"> <li><span style="font-weight: 600;"><span style="text-decoration: underline;">Make sure you computer is clean</span></span>&nbsp;- Malware, Virus and Trojan Free. Start with a brand new, unused computer if you can. Preferably, in the original packaging, unopened. If that is not practical from a financial or logistical perspective, thoroughly clean the computer that you are going to use with a deep (not quick scan) scan from a prominet anti-virus software vendor (ex.&nbsp;<a href="http://us.norton.com/" style="color: #4c90fe; transition: color 0.2s linear;">Norton</a>,&nbsp;<a href="http://www.avg.com/us-en/homepage" style="color: #4c90fe; transition: color 0.2s linear;">AVG</a>,&nbsp;<a href="http://usa.kaspersky.com/?domain=kaspersky.com" style="color: #4c90fe; transition: color 0.2s linear;">Kapersky</a>).</li> <li><span style="text-decoration: underline;"><span style="font-weight: 600;">Ensure your privacy to the best of your ability</span></span>. Install a compounding VPN system on your machine from a vendor that DOES NOT log your activity (ex.&nbsp;<a href="https://airvpn.org/" style="color: #4c90fe; transition: color 0.2s linear;">AIRVPN</a>,&nbsp;<a href="https://www.f-secure.com/en/web/home_global/freedome" style="color: #4c90fe; transition: color 0.2s linear;">FREEDOME</a>,&nbsp;<a href="http://www.liquidvpn.com/" style="color: #4c90fe; transition: color 0.2s linear;">LIQUIDVPN</a>), and get it up and running.</li> <li><span style="font-weight: 600;"><span style="text-decoration: underline;">Prepare your machine.</span></span>&nbsp;Download the&nbsp;<a href="http://java.com/en/" style="color: #4c90fe; transition: color 0.2s linear;">Oracle version of Java runtime</a>&nbsp;on your machine if you don't already have it.&nbsp;</li> <li><span style="text-decoration: underline;"><span style="font-weight: 600;">Install Veritaseum's Smart Contract Aware, Value Trading Wallet</span></span>&nbsp;- Go to<a href="http://veritaseum.com/index.php/download/veritaseum-wallet" style="color: #4c90fe; transition: color 0.2s linear;">Veritaseum.com</a>&nbsp;download menu at the top of the screen and select Veritaseum Wallet, then the flavor of your choice. It's also recommended that you download the&nbsp;<a href="http://veritaseum.com/index.php/download/veritaseum-wallet/quick-start-tutorial" style="color: #4c90fe; transition: color 0.2s linear;">quick start tutorial&nbsp;</a>as well.</li> <li><img src="http://veritaseum.com/images/Coins/Download_veritaseum.jpg" alt="Download veritaseum" width="860" height="313" style="max-width: 100%; height: auto !important;" /></li> <li>Open the wallet in "Live Mode", go to the wallet tab on top and copy out your wallet's address.</li> <li><img src="http://veritaseum.com/images/Coins/wallet_address.jpg" alt="wallet address" width="860" height="594" style="max-width: 100%; height: auto !important;" /></li> <li><span style="text-decoration: underline;"><span style="font-weight: 600;">Convert your fiat (government controlled) currency for bitcoin</span></span>: Go to an exchange or BTC onramp provider to convert your fiat (likely EUR or USD in this case) to BTC (Bitcoin). Some popular services are (<a href="http://coinbase.com/" style="color: #4c90fe; transition: color 0.2s linear;">Coinbase</a>,&nbsp;<a href="https://localbitcoins.com/" style="color: #4c90fe; transition: color 0.2s linear;">Local Bitcoins</a>). Once BTC is obtained, send your bitcoin to our Veritaseum wallet via your copied address.</li> <li><span style="text-decoration: underline;"><span style="font-weight: 600;">Create a Veritaseum Contract that suits your situation</span></span>: Click the "Markets" tab to create a contract that exchanges the value of you BTC from your native currency (presumably EUR) to the currency, currency pair, or asset exposure of your choice for the time period you wish it to be for (this is where the&nbsp;<a href="http://veritaseum.com/index.php/download/veritaseum-wallet/quick-start-tutorial" style="color: #4c90fe; transition: color 0.2s linear; line-height: 27.2000007629395px;">quick start tutorial&nbsp;</a>comes in handy). In the example below, you will be selling (paying) the value of EUR for the value of USD for 45 days. Keep in mind, you can also trade the value of BTC for EUR, or EUR for the value of gold (GLD) which may retain its value relative to the EUR should additional bank bail-ins arrive. You have a choice of over 45,000 ticker exposures in all asset classes (bonds, stocks, forex, commodities and indices) from any major exchange in the world. You can even do forex pairs and use leverage to mute the effects of BTC price fluctuation.&nbsp;</li> <li><img src="http://veritaseum.com/images/Coins/USD_for_EUR_value_trade.jpg" alt="USD for EUR value trade" width="474" height="573" style="max-width: 100%; line-height: 27.2000007629395px; height: auto !important;" /></li> <li>Wait for your contract to be accepted by a counterparty. Once accepted, it will be listed in your trades page like this...</li> <li><img src="http://veritaseum.com/images/Coins/List_of_contracts.jpg" alt="List of contracts" width="860" height="600" style="max-width: 100%; height: auto !important;" /></li> <li>Remember, your funds are not "in contract" until someone takes the other side of the trade. Even without someone taking the other side of your trade you still have liberated your capital into the blockchain, where capital controls and bank holidays literally do not exist. Your money can be transferred to another location, either next door or to the other side of the world, within minutes and for pennies - literally! &nbsp;</li> <li>&nbsp;<img src="http://veritaseum.com/images/Coins/send_funds.jpg" alt="send funds" width="860" height="538" style="max-width: 100%; height: auto !important;" /></li> </ol> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;Due to the weakness of the euro relative to the dollar, I see ample liqudity in the EUR/USD contracts. I will personally oversee it. So, come one and come all. Liberate your (likely) soon to be capital controlled capital (euros).&nbsp;</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"><span style="text-decoration: underline;"><span style="font-weight: 600;">Important to remember:</span></span></p> <ol style="margin: 2em 0px; padding: 0px; list-style-position: inside; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;"> <li>You are not exchanging physical euros for dollars. Veritaseum contracts are derivatives that give you the price movement of whatever it is you are contracted for. Thus you the equivalent of dollar/euro movement added to your bitcoin balance at the end of the contract, just as if you sold euros to buy dollars (or whatever asset combination you chose to employ.</li> <li>We are a software and research firm, not a financial institution. At no time at all do you have any exposure to our balance sheet (like Bank Laiki, Bear Stearns or Lehman).</li> <li><span style="line-height: 27.2000007629395px;">You are not, and never do, send your money or capital to us. Your tranactions are totally peer-to-peer from a monetary perspective. You either have you money in your private wallet (which you have, not us), or on the blockchain (the fortified cloud), at all times. When on the blockchain, all you need to do is click the "track transaction" button to see exactly where on the blockchain it is, the path it took to get there, and how long it has been there.</span></li> <li>Bitcoin has material price volatility and this platform is in beta status. We have methodologies to mute bitcoin volatility. Email us for more details or search our site.</li> </ol> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">We believe this system is considerably safer than any bank out there.</p> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;If you've read to the end of this article, you are obviously interested. I will assist anybody interested in mobilizing their capital. Anything mentioned in this article our team will assist with for free. More advanced techniques and strategies&nbsp;<a href="http://veritaseum.com/index.php/buy-veritas" style="color: #4c90fe; transition: color 0.2s linear;">require a Veritas purchase</a>. <a href="https://docs.google.com/presentation/d/1UxB33wp1rCncBtPbuzQbkS1SZg_fjCTNMqu-wZGii-o/pub?start=true&amp;loop=false&amp;delayms=10000">Learn more about Veritaseum</a> or contact us&nbsp;<a href="http://veritaseum.com/index.php/joomla-pages-i/contacts-in-category" style="color: #4c90fe; transition: color 0.2s linear;">to get started now</a>.</p> <h1 style="font-size: 23.3999996185303px; color: #2d2d2d; font-weight: 400; line-height: 1.2; margin-top: 0px; margin-bottom: 0px; padding: 0px; border: 0px; outline: 0px; font-family: Arial, Helvetica, sans-serif; background-image: initial; background-attachment: initial; background-position: initial; background-repeat: initial;"><iframe src="http://www.youtube.com/embed/tdE_mq8g3YY?rel=0&amp;wmode=opaque" width="425" height="350"></iframe>&nbsp;</h1> <p style="margin: 0.5em 0px 1.5em; color: #666666; font-family: 'Open Sans', Arial, sans-serif; font-size: 17px; line-height: 27.2000007629395px;">&nbsp;</p> http://www.zerohedge.com/news/2015-04-18/full-analysis-and-step-step-guide-eu-area-residents-aid-escaping-upcoming-bank-bail-#comments Bank Run Bear Stearns Bitcoin Bond Capital Markets CDS China Creditors default ETC European Union Eurozone Fail fixed Fractional Reserve Banking Funding Mismatch Germany Greece Gross Domestic Product India International Monetary Fund Investment Grade Ireland Lehman Lehman Brothers Monetary Policy Portugal ratings Ratings Agencies Real estate Sovereign Debt Sovereign Risk Sovereign Risk Sovereigns Too Big To Fail Twitter Twitter Volatility Sat, 18 Apr 2015 16:21:45 +0000 Reggie Middleton 504973 at http://www.zerohedge.com China Sees Largest Capital Outflow In Three Years Amid Currency Conundrum http://www.zerohedge.com/news/2015-04-18/china-sees-largest-capital-outflow-three-years-amid-currency-conundrum <p>In light of the <a href="http://www.zerohedge.com/news/2015-04-14/china-gdp-tumbles-lowest-6-years-amid-quadruple-whammy-dismal-data">most recent GDP data</a> out of China which showed the economy growing at the slowest pace in six years, we thought it time to revisit what we <a href="http://www.zerohedge.com/news/2015-03-06/how-beijing-responding-soaring-dollar-and-why-qe-china-now-inevitable">recently called</a> “the flowchart for what is in store for the world for the next 12-24 months.” As we noted in early March, China faces a decelerating economy and a currency conundrum, the combination of which may eventually leave the PBoC with little choice but to first cut rates to zero then engage in outright QE. </p> <p>In short, China needs to devalue in order to counter weakening economic growth and slumping exports. Maintaining the dollar peg at a time when the dollar is surging has led to double-digit REER appreciation for the yuan, a decisively undesirable outcome for the country’s export-driven economy in the face of still sluggish global demand. Additionally, this is all serving to hamper the PBoC’s existing liquidity easing efforts. Here’s Barclays summing up:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><strong><em>CNY overvaluation is getting more extreme, with USDCNY remaining relatively stable while trade partner currencies fall sharply versus the USD. Our BEER model estimates that the CNY is around 20% overvalued, making it one of the most expensive currency globally.</em></strong></p> <p><strong><em>&nbsp;</em></strong></p> <p><em>FX intervention to limit CNY weakness (ie, selling USD) is having the effect of tightening domestic CNY liquidity. The PBoC does have room to cut the reserve requirement ratio (RRR) rate to offset the liquidity impact of FX intervention, as the current RRR level of 19.5% is high by historical standards – the ratio was as low as 6% in 2002. However, a further drain of liquidity may not be appropriate if a step-up in monetary easing is needed to counter a sharper growth slowdown and to bring down elevated funding costs.&nbsp;</em></p> <p>&nbsp;</p> <p><strong><em><span style="font-size: 1em; line-height: 1.3em;">The global recovery remains uneven and desynchronized, with the US being the sole engine of growth. While China’s exports are so far performing better than other EM Asian economies’, the recent sharp CNY REER appreciation might have a dampening effect on Chinese exports to countries apart from the US.&nbsp;</span></em></strong></p> </blockquote> <p>Long story short: preventing CNY depreciation is becoming very, very costly in a world characterized by a strengthening USD and still raging currency wars across DM central banks. This has fueled speculation that China, no longer able to take the economic pain, will eventually give in, and that expectation has in turn fueled capital outflows. Of course capital outflows may make it more difficult to devalue (you don’t want to throw fuel on the fire), which means that in the end, China is stuck with few options and as JPM outlines, <strong>Q1 marked the fourth consecutive quarter of capital outflows bringing the total to $300 billion over the period.</strong> Here’s more:</p> <blockquote><div class="quote_start"> <div></div> </div> <div class="quote_end"> <div></div> </div> <p><em>Chinese FX reserves were depleted for a second straight quarter, by $70bn cumulatively during Q4 2014 and Q1 2015 as China supported its currency. At the same time a current account surplus in Q1 combined with a drawdown in reserves suggests that capital outflows from China continued for the fourth straight quarter…</em></p> <p>&nbsp;</p> <p><em><strong>This brings the cumulative capital outflow over the past four quarters to $300bn.</strong> Again, we deduct capital inflow from the change in FX reserves minus the current account balance for each previous quarter to arrive at this estimate. <strong>The last time China suffered such pace of capital outflows was during 2012 when $165bn of capital left during the last three quarters of that year. And before then it was during the Lehman crisis when China suffered capital outflows, but much smaller in size (around $60bn of capital left China during the second half of 2008).</strong> So the 2012 capital outflow episode is more comparable in size to the current one…</em></p> <p>&nbsp;</p> <p><em>The capital outflow appears to be driven by the more volatile “Other Investment” item in balance of payments. And within this item there are three components that saw the most significant swing during China’s most recent capital outflow episodes, i.e. the last three quarters of 2012 and the past four quarters (from Q2 2014 to Q1 2015): “short term trade credits” within foreign assets, “currency and deposits” within foreign assets and “short term loans” within foreign liabilities. The first component averaged -$10.5bn per quarter outside the above two episodes and -$26.0bn per quarter during the two episodes. A negative sign means that Chinese companies extended short term trade credit to foreign companies, which is equivalent to Chinese companies lending to foreign entities. <strong>In other words during the past two capital outflow episodes Chinese companies or the subsidiaries of foreign companies in China appear to have used trade credits to increase their long dollar exposure or to reduce their long renminbi exposure..</strong></em></p> <p>&nbsp;</p> <p><em>The second component, “currency and deposits” in foreign assets, averaged - $15.3bn per quarter outside the two episodes and -$28.0bn per quarter during the two episodes. A negative sign implies a capital outflow ?<strong> i.e. it means that during the past two capital outflow episodes Chinese companies or the subsidiaries of foreign companies in China held on to their foreign currency and boosted their dollar or foreign currency deposits…</strong></em></p> <p>&nbsp;</p> <p><em>The third component, “short term loans” in foreign liabilities, averaged $18.7bn per quarter outside the above two episodes and -$23.4bn during the two episodes; i.e. it experienced an even bigger swing that the first two components. A positive sign implies borrowing of Chinese residents from abroad (a capital inflow) while a negative sign implies repayment of foreign loans by Chinese residents (a capital outflow). The deterioration of this item is thus likely caused by 1) foreign residents reducing their renminbi deposits or previously extended short term loans to Chinese entities or 2) Chinese companies unwinding previous short dollar exposure by repaying foreign currency loans to foreign banks, e.g. Hong Kong banks.&nbsp;</em></p> <p>&nbsp;</p> </blockquote> <p><em>&nbsp;<a href="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/2015/04/ChinaCapitalOutflow.jpg"><img src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/2015/04/ChinaCapitalOutflow.jpg" width="210" height="241" /></a></em></p> <p><span style="font-size: 1em; line-height: 1.3em;">And while JPM believes the above does not “suggest that a new trend of broad-based capital outflows is emerging in China” but rather reflects “opportunistic currency and interest expectations,” it most certainly underscores the precariousness of the situation if you’re Beijing, or, as we have put it on a number of occasions: “devalue too much, and the capital outflows will accelerate, not devalue enough, and the mercantilist economy gets it.”&nbsp;</span><span style="font-size: 1em; line-height: 1.3em;">Whether this rather untenable situation ultimately deadends in Chinese QE remains to be seen but given the economic situation, China may have no choice but to devalue especially once the country's margin-driven equity bubble distraction comes to an unceremonious end.</span></p> <p><span style="font-size: 1em; line-height: 1.3em;">Some Saturday morning headlines to ponder as you consider all of the above:</span></p> <ul> <li><span style="font-size: 1em; line-height: 1.3em;">CHINA HAS EASING ROOM, WON'T NECESSARILY USE IT: PBOC'S ZHOU</span></li> <li><span style="font-size: 1em; line-height: 1.3em;">CHINA HAS MORE ROOM FOR EASING THAN OTHER NATIONS: PBOC'S ZHOU</span></li> <li><span style="font-size: 1em; line-height: 1.3em;">CHINA HAS EASING ROOM IN RESERVE RATIO, INTEREST RATES: ZHOU</span></li> <li><span style="font-size: 1em; line-height: 1.3em;">CHINA NEEDS TO ADJUST MONETARY POLICY CAREFULLY: PBOC'S ZHOU</span></li> </ul> <div class="field field-type-filefield field-field-image-teaser"> <div class="field-items"> <div class="field-item odd"> <img class="imagefield imagefield-field_image_teaser" width="210" height="139" alt="" src="http://www.zerohedge.com/sites/default/files/images/user92183/imageroot/ChinaCapitalTeaser.jpg?1429368337" /> </div> </div> </div> http://www.zerohedge.com/news/2015-04-18/china-sees-largest-capital-outflow-three-years-amid-currency-conundrum#comments Barclays Central Banks China headlines Hong Kong Lehman Monetary Policy recovery Renminbi Yuan Sat, 18 Apr 2015 15:45:20 +0000 Tyler Durden 504972 at http://www.zerohedge.com