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Six Signs That 2016 Will Be Much Worse Than 2015
Submitted by GlobalGold's Claudio Grass via Acting-Man.com,
A Turbulent Year
In the course of 2015 we have witnessed several events that had, and will have, negative repercussions on individual freedom. Orwellian totalitarianism is increasingly creeping into our everyday lives. How much more intrusive will the violations of our liberties become and for how long will the establishment get away with this? These are questions that remain unanswered.
United we move toward a perfectly monitored society – the US Congress has just passed the controversial CISA spying law – the worst possible version of it – by sneaking it into a budget bill. This utterly corrupt method of enacting laws that would not get passed on their own because they are such a huge affront to decency and civilization has become the norm in the “land of the free” – which ironically is “exporting democracy” by force of arms all over the world!
With regards to the financial system, no real solution was found to issues such as those in the euro zone. Furthermore, the financial system as a whole once again got deeper into debt. For how much longer can central banks and governments continue kicking the can down the road without any real reform? I will try to answer these questions and identify trends for 2016 by looking at six key issues that have had an impact this year.
1. Geopolitical Developments
We have witnessed a number of troubling geopolitical developments during this past year. From the continuing conflict between Russia and Ukraine, territorial disputes between Japan and China, the escalating proxy war in Syria, the refugee crisis in Europe, the rise of religious tensions all over world to the rise of the Islamic State, the world has become increasingly unstable.
Yet another finger-wagger: Abu Bakr al-Baghdadi, the self-anointed “Caliph” of the medieval retro-state that has sprung up in Syria and Iraq.
Going into the details of these conflicts is beyond the scope of this article, but the fact is that all of these developments harbor the potential for large-scale escalation. From the perspective of the West, the conflicts and wars of the past decades were for the most part far away. Only now do we realize that this will change as we have already begun to see in 2015. The times of conventional warfare, when two armies met on the battlefront, are over. Future conflicts and wars will be fought closer to home. We should get ready for a period of increased instability, particularly with respect to politics and security issues.
2. Totalitarianism is on the Rise
The sudden rise of ISIS and its affiliates is a disturbing development that has produced a smorgasbord of feelings, ranging from fear to rage to sadness and more. Ultimately though, they all lead to the same result: States are seeking more control over their citizens by curbing individual liberties.
One example is that Western countries are limiting the use of cash, under the guise of fighting terrorism and illicit activities. JP Morgan has placed restrictions on the amount of cash one is allowed to deposit and several European countries have banned cash transactions exceeding a certain size. Looking to the future, it seems that this trend will continue to worsen and that we are headed toward an Orwellian police state in which no one is entitled to financial privacy anymore.
Another hot-button issue is gun control. Since it became known that the San Bernardino shooting and the Paris attacks were apparently carried out with legally obtained arms, there have been increased calls for massive restrictions on private gun ownership. Disarming the masses is a necessity to control them and that is exactly what our governments are gradually doing.
“The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in Government” – Thomas Jefferson.
FRONTEX operational territory; insert: Frontex uniform. This paramilitary bureaucracy is headquartered in Warsaw and threatens to override the sovereignty of EU member nations.
On the EU level, a disturbing development is the fact that FRONTEX (the EU agency responsible for border management) has stated that it will intervene to secure the EU’s borders should the refugee crisis get out of hand, even if the respective countries oppose its action. On a global level, the Transatlantic Trade and Investment Partnership (TTIP) says that arbitration courts will have the potential to annul national sovereignty when it comes to jurisprudence. We expect this trend toward ever greater centralization to continue.
3. The “Rescue” of Greece: Coming to a Country Near You?
At the beginning of this year, the topic of a potential “Grexit” dominated news cycles over several weeks. It seemed like a realistic possibility that Greece might leave the euro zone. Instead, after yet another one billion euro bailout package, Greece was “saved” and a “Grexit” was off the table (for the time being). Once again, political idiocy prevailed over economic rationale. In the end, delaying the inevitable failure of the Greek financial system is all that was achieved.
Desperate Greek pensioners queuing at an ATM during the “bank holiday”. Many of them realized a number of facts far too late: a) that fractionally reserved banks are de facto insolvent and cannot pay the vast majority of their depositors in extremis (especially if the central bank backstop is withdrawn); b) that the European elites would expropriate them in an eye-blink for “their own good”; and c) that any vote that doesn’t conform to the wishes of the EU bureaucracy is worth precisely nothing – even in the “cradle of democracy”.
More astonishing than the fact that Greece – a country that represents less than one third of one percent of the world GDP – received another huge bailout package, was how it all played out. A bank holiday was announced, capital controls were implemented, cash withdrawals were massively restricted, the stock market closed and any assets inside the banking system (even safety deposit boxes) were no longer accessible to their owners. This is an unprecedented level of infringement on private ownership that has never been seen in a modern Western country.
4. Fed Hikes Interest Rates
The Fed hikes interest rates for the first time since the financial crisis of 2008. For the past 7 years we have had an interest rate band between 0-0.25%, which is essentially “money for nothing”. With its decision, the Fed became the first large (and the leading) central bank to effectively hike interest rates.
The effective federal funds rate (a weighted average) has jumped to the highest level since late 2008. This “high level” is still next to nothing though – click to enlarge.
Meanwhile, on the other side of the Atlantic, the ECB cut its deposit rate (slightly) deeper into negative territory and prolonged its QE program that is now expected to continue until March 2017. Since last summer, the media continuously speculated about a rate hike and its timing. So, will interest rates start to normalize after the long-awaited change in monetary policy? We don’t think so! We believe that the main reason the Fed decided to hike rates was to regain some of its lost credibility.
For the past seven years the monetary floodgates have been open with no clear positive effect on the real economy. A continuation of zero interest rate policy (ZIRP) would have been an admission of failure. With this slight rate hike of 25bps, the Fed is trying to show the world that its policy during the financial crisis worked.
We all know that the economy in the US is not as healthy as the Fed would like us to believe. When we throw in the potentially explosive impact the failing shale industry could have on the economy and the strength of the dollar, that is likely to increase further due to this rate hike, we doubt that this move by the Fed is the turning point and that the Fed will continue hiking rates as it has done previously in such cycles. The Fed raised interest rates because it had to, but don’t expect the monetary shenanigans to be over. There are a lot more to come!
5. Defaults Surge as Global Debt Explodes
2015 has seen the greatest number of corporate defaults since the financial crisis. Many of the companies that are defaulting are from the energy and materials sector. Why? It is the logical outcome of the excessive borrowing by corporations who were misled by close-to-zero interest rates. And, of course, we must not forget the boom in the shale industry.
With a barrel of oil costing over USD100, shale oil was a very interesting investment. Now with oil hitting rock bottom, some oil producers are operating at a loss and only continue operations to be able to make their interest payments. The number of corporate bonds Standard & Poor’s rates as junk or speculative, has gone up to 50% from a previous 40%. Unfortunately, the world did not learn its lesson after the financial crisis and instead of deleveraging, it has accumulated even more debt, as the chart below illustrates. Of course it not only corporations that are responsible; governments have not learned their lesson either.
No deleveraging is in sight – click to enlarge.
The issue of debt will continue to be with us for some time to come; the house of cards will eventually collapse, but we think that politicians and central bankers have the will to “do whatever it takes” to prolong its eventual demise. What we will likely see in 2016, however, is a massive increase in defaults. Yields on high-yield bonds are already at alarming levels.
What exactly will be responsible for the next crisis is hard to foresee. The trigger might be the possible collapse of the shale industry, or the strengthening dollar, that will make it very hard for emerging market countries to repay their debts, or a completely unexpected sector (who knew what sub-prime was back in 2006?).
6. Oil Price Collapse
Crude oil prices fell to their lowest levels in nearly 11 years, as crude oil declined to nearly USD35 per barrel. The price of oil has been on a continuous downward trend and has plunged nearly 70% since the summer of 2014. From our perspective, the main factor that led to this decline is the US shale oil “revolution”.
It was truly a revolution, considering that the boom in shale oil production allowed production in the US to surpass that of Saudi Arabia, previously the world’s largest oil producer. Meanwhile, OPEC hasn’t changed its stance as it insists on maintaining its strategy to increase its market share, even if this comes at the expense of further oil price declines.
US crude oil production has more than doubled from the multi-decade lows reached in 2008/9
I am not an expert on oil and therefore it am not going to provide predictions on where the oil price is heading next. I would rather want to discuss the impact of the oil price movement to date. First of all, a collapse of the oil price, a commodity that is widely used in industry, has historically always been a herald of recessionary tendencies. In my view, the oil price clearly signals that the economy is not as healthy as is portrayed by the mainstream media.
Secondly, the ongoing failure of companies in the shale industry has the potential to bring on a crisis that could dwarf the previous financial crisis. Last, but definitely not least, is the question of how oil exporters such as Saudi Arabia, will finance their budgets when oil revenues massively decrease and they are no longer able to buy their population’s silence with gifts.
How can we Position Ourselves in such an Environment?
The outlook for the future looks bleak: continuously growing debt, looming defaults on a major scale and geopolitical tensions. So how can we best position ourselves?
In times like these, when it seems impossible to predict even the near future, we seek security. Precious metals like gold and silver represent wealth and value. They give their owners a degree of independence and protection from the whims of governments. In light of recent events in Greece, it turns out that gold and silver are only a safe investment as long as one has full control over it and can access it at any time. Holding gold outside of the banking system is therefore essential in my view.
Those who know me know that I am Swiss and rather biased towards my home country. To me, Switzerland strikes the perfect balance between international neutrality with a history of a safe and stable political landscape, and an environment that encourages investment and guarantees private ownership rights.
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I guarantee that the prediction is correct. Be prepared and ready to say NO.
With both Bush and Hillary pushing the buttons and lame stream media towing the line, there is very serious trouble ahead.
There will be at least one awe-inspiring, joyous, benevolent, kiss-the-ground event in 2016 and that is the Obamas vacating the White House.*
*Probably not as the neo-bolsheviks will set everything on fire so that martial law will have to be declared and gosh dangit, elections postponed.
January, 2017
A breakout of global civil unrest as we embark on a clash of civilizations and a fight for survival in the new year, as it is reported that German Chancellor Angela Merkel is allegedly ‘Hitler’s Daughter’ and the Fourth Reich is about to become a reality......
http://beforeitsnews.com/conspiracy-theories/2015/12/the-fix-is-in-franc...
Hitler gets more press on the History channel than Bill and Hillary? Then again they feature UFO's and Bigfoot.
For how much longer can central banks and governments continue kicking the can down the road without any real reform?
Apparently much longer than any of us thought possible.
We used to have a sign in the office that read: "Do the right thing only after all other options have been exhausted."
We determined that was far too optimistic so we replaced it with the following: "Today is as good as it gets."
I have a cherished sign next to my desk that says: "I'd like to be an optimist. I doubt that it would work though."
Mine says, 'Being a pessimist means you can only be pleasantly surprised.' I'm still waiting.
You are showing US oil production rising to 9.5 million barrels a day while US consumption is 20 million barrels day. With all the corn converted into ethanol (enough to feed 420 million people for a year), the US still imports 7.5 million barrels a day today, almost exactly the same as China.
As far as #2 goes, they can make the journey short and shoot me.
To me, Switzerland strikes the perfect balance between international neutrality with a history of a safe and stable political landscape, and an environment that encourages investment and guarantees private ownership rights.
You mean it used to. Your banks have folded like a cheap tent and now your getting assfucked by Mohammed...after they did your wife and daughter...and he ain't even going to give you reach around.
switzerland's migrant problems are pretty minor, they aren't taking many refugees.
you're probably confusing switzerland and sweden - that's ok, you're a stupid american who is easily confused and can't tell the difference, your pubic education system is not good, as evidenced by your being unable to distinguish between "your" and "you're". also, you're a degenerate and a pervert, as evidenced by your public comments on sodomy.
unintelligent, poorly educated degenerate - yep, sounds like an american to me.
i've been to switzerland a couple of times, it's a very nice place, very high standard of living, clean, conservative values, almost no crime. they don't let many people in, though; you wouldn't make the cut.
Baghdadi's turban needs a Nike sponsored tick on it to complete the look.
Bring it the fuck on.......
You can't stop it, so I say false bravado.
Kirk’s Predictions for 2016 (rev.2015.1222)
Part A - What WILL Happen in 2016:
1. ZH will continue to write ‘The End is Near’. ZH ad revenues will keep rising.
2. ZHers will be certain, that this time (2016) the Crash or Reset will indeed arrive; just as they have predicted the last 7 years. ZH ad revenues will keep rising.
3. ZHers will be fully in the tank for Trump
4. China will keep buying base and precious commodities at depressed and manipulated prices. London and NY will play along (via middlemen), to prevent China from dumping USTs.
5. Bears will continue to be bearish, Bulls will continue to be bullish – each with their own porn charts and irrespective of reality.
6. More bullish and bearish suckers will be born every day.
7. The US will continue on its current trajectory: Vanishing freedoms and privacy, ongoing rise of Totalitarianism (with a mix of 1984 and Brave New World)
8. The EU will continue its downward slide as a group of vassal states of the US
9. The US Gov and Media will continue their slide into vassalhood of the 0.001%
10. The US and EU labor participation rates will continue to drop, but the Unemployment figures will ignore that.
11. The price of food will continue to climb and crush middle-class families, but the Gov stats on Inflation (CPI) will not reflect that.
12. The US MIC will lobby as hard as ever and bitch, moan, complain and ululate louder than a shorted MENA harlot.
13. DOD will have more 6 star generals and fewer 5 star generals. As will Con-gress.
14. Russia will keep showcasing its Toys of War and advertise/shill for its MIC in Syria, but won’t shut down Syrian airspace against Western or GCC Air Forces, who are aiding ISIS. That would take some real ‘stones’, instead of bombing mere sand jockeys.
15. The Rio Olympics will be a… ‘hoot’. Long Peak Hookers (going down) for visitors, and Peak Debt (going up) for Brasil.
16. More banksters and CEOs will have close shave with cancer, but recover in proportion to their stock.
17. You’ll get Hillary or Trump. Pre-order drinks and anti-depressants for respective camps.
18. Western Main/Lame-Stream Media will lose even more respect from Main St.
19 ZHers will keep urging people to “Roll the MF’ing guillotines!”, but won’t take one step to organize ZHers into a group of physical activists. Why bother, when the keyboard and mouse are so much easier and safer? You're on your own. Same as it ever was.
20. Kirk will retire. Again. Or get banned.
Kirk’s Predictions for 2016 (rev.2015.12.22)
What Will NOT Happen in 2016:
1. The world will not end, and ‘42’ is not the answer to everything. 69 might be though.
2. We will not have Peak Oil. Nor Peak BS.
3. The price of PM will not recover, or come anywhere near its peak of 4 years ago. PM prices will go lower, forcing mining consolidations and cheap buyouts from Neocons and Chinese, after mine management files for Ch.7 or Ch. 11
4. The US Presidential Election in Nov. 2016 will not change anything of substance for the US
5. Neither China or Russia will back their paper fiat with gold.
6. After all the 2014-2015 hoopla, the BRICS and EM’s still wil not have their Russian or Chinese alternative to SWIFT. They will have to keep using the USD, and keep getting crushed by it, so that China can buy their commodities dirt cheap.
7. McCain won’t retire or have a stroke. Adelson, Bush 1, Brzezinski, Cheney, Kissinger or Soros won’t croak – no matter how much 99.9% of the world wishes they would
8. Syria will not get back its oil fields up north, nor the Golan.
9. 2016: The world will not end. Gold will not recover. The Dollar will not end. There won’t be a Reset.
10. The funny punchlines on ZH won’t end either. So cheer up.
Kirk sounds like an idiot; he makes way too many predictions, in this quality...
Anyone can do lists like this. Here's mine:
1. There will be massive terrorist attacks on US soil, blamed on ISIS, as well as many more in Europe.
2. There will be a market crash that happens after that, but with all the chaos and terror the news will be dwarfed.
3. Martial law of some sort will happen. Dissidents may be rounded up...which could start -
4. Civil war and/or a military coup will ensue, removing OBOy and the 'bad' politicos and banksters from power.
5. By September, the US will be a total shambles, with the dollar worthless and removed as the reserve currency, as -
6. Russia and China completely depeg from the dollar and announce gold backing for their respective currencies, which will enter the SDR, the new reserve currency.
7. The war in the middle east will eventually backfire on Israel after events in the US reveal who ISIS really is, and it will cease to be a country as 'Zionists' are blamed for everything...as:
8. There will be a limited 'truth hangout' about 9/11, JFK, Sandy Hook etc. all implicating the 'Zionists'.
9. While everyone is blaming the 'Zionists' for all the world's problems, no one will notice that the head bankers now control ALL the world's currencies and Globalism has won.
10. Or, all of the above will become moot when a fucking massive comet destroys the motherfucking earth. THE END.
Numbers 6 and 9 are mutually exclusive, gold being an uncontrolled and free medium of exchange.
Correct and after the collapse there will be convertions between Gold and Bitcoins, totally OUT of reach for any government.
Those settlements will enable International transfers totally untraceable and unstopable.
Banks will be even more doomed.
"For how much longer can central banks and governments continue kicking the can down the road without any real reform?"
Answer...for a hell of a lot longer than you or I believe possible.
Amd we will all still be bitchez
http://i.ytimg.com/vi/BnRJJaeLB90/0.jpg
So...everything really is awesome then. Cool.
"Orwellian totalitarianism is increasingly creeping into our everyday lives"...in Switzerland...FIFA extraditions...from a former "safe heaven"...to the former "land of the free"
"For imperialism, totalitarian state is the one and only suitable political organisation".
Celente's trend for 2013 was 'more of the same only worse'. I guess we can now expect more of the worse only worserer. He was spot on with 2014 - War and 2015 - banksterism.
I thinlk Kirk is spot on too.
I am waiting for the NIR or seizure that is the straw that breaks the back of the phony central banking SCAM.
Number 4 is BUNK. Our rate hike was a "one and done". It took nearly 10 years for that one. See us in 2025 for the next quarter point hike.
Only thing is, we will be at a negative 15% by then, provided that our limitless hubris lasts, we are able to continue to redefine the meaning of compounding interest, our trading partners keep accepting our wallpaper currency, and the sheeple keep looking up to us as if we were gods.
Number 5 is also BUNK, as we are quietly buying junk bonds with newly created greenbacks for a new secret gov't program we call S.C.A.M. ("Shittier Collateral Asset Mound"). How else can we keep this credit mania alive?
Aint FIAT great!!? the stuff bubbles, unicorns, and dreams are made of.
Number 4 could happen. You just don't know what else they have planned.
I don't see the problem here.
Uncle Sugah has our backs! They are here to help us!
How convenient.
1. the boom in shale oil production allowed production in the US to surpass that of Saudi Arabia
2. Saudi Arabia opens the floodgates, saturating the market and causing the price of oil to plummet. Pushing shale oil producers to the brink of bankruptcy.
3. Was it the crown prince of Saud, or the King 'visited' (his Washington serfs) a couple months ago?
4. The US suddenly changes two laws, one to allow exports of US oil (when it is at an historic low and nobody can afford the loss of exporting it), and the second allowing foreigners to purchase valuable American real estate (such as farmland or ...shale oil deposits.)
5 If that wasn't quite enough, the Fed raises rates, making debt more expensive.
6. Who wants to bet that half of N. Dakota is owned by the House of Saud within two years? -And at rock bottom bankruptcy prices too.
My money is on the Chinese for owning half of N Dakota. Which is the lesser of the evils?
#7 Gold will continue its collapse