Apocalypse Now: Has Next Giant Financial Crash Already Begun?

Apocalypse Now: Has Next Giant Financial Crash Already Begun? [14]

Paul Mason, writing in The Guardian, describes how we are already at the beginning of a financial Apocalyse. “A predicted global meltdown passed without event. But there are enough warning signs to suggest we are sleepwalking into another disaster”.

He suggests all the signs are present to indicate that the financial apocalyse has begun:

“Let’s assemble the evidence. First, the unsustainable debt. Since 2007, the pile of debt in the world has grown by $57tn (£37tn). That’s a compound annual growth rate of 5.3%, significantly beating GDP. Debts have doubled in the so-called emerging markets, while rising by just over a third in the developed world”.

“John Maynard Keynes once wrote that money is a “link to the future” – meaning that what we do with money is a signal of what we think is going to happen in the future. What we’ve done with credit since the global crisis of 2008 is expand it faster than the economy – which can only be done rationally if we think the future is going to be much richer than the present”.

“This summer, the Bank for International Settlements (BIS) pointed out that certain major economies were seeing a sharp rise in debt-to-GDP ratios, which were well outside historic norms. In China, the rest of Asia and Brazil, private-sector borrowing has risen so quickly that BIS’s dashboard of risk is flashing red. In two thirds of all cases, red warnings such as this are followed by a major banking crisis within three years.”

“The underlying cause of this debt glut is the $12tn of free or cheap money created by central banks since 2009, combined with near-zero interest rates. When the real price of money is close to zero, people borrow and worry about the consequences later.”

“So, the biggest risk to the world, despite its growing seriousness, is not the deflation of a bubble. It is the risk of that becoming intertwined with geopolitics. Any politician who minimises or ignores this risk is doing what the purblind economists did in the run up to 2008?.

Read the full article “Apocalypse now: has the next giant financial crash already begun? [15]”

Paul Mason is a respected journalist and broadcaster. He is a former economics editor of BBC’s Newsnight and currently he is economics editor of Channel 4 News. He can be followed on @paulmasonnews [16].

DAILY PRICES
Today’s Gold Prices: USD 1130.90, EURO 1029.82 and GBP 733.95 per ounce.
Friday’s Gold Prices: USD 1135.80 , EURO 1030.86 and GBP 733.86 per ounce.
(LBMA AM)

Gold was down again yesterday closing at $1134.30, a loss of $7.20 on the day. Silver lost $0.09 to close at $15.4. Platinum lost $8 to $974.

IMPORTANT NEWS

Gold slides to lowest settlement in a month – MarketWatch
Manufacturing in U.S. Stagnated in October on Weak Global Sales- Bloomberg
You Heard Right: A Billion Dollars in Gold is Coming to Texas – KUT.org
Metal detector hunter’s £1.3M coin find declared official treasure trove – Irish Mirror
ECB Officials Met Regularly With Financial Institutions – Wall Street Journal

IMPORTANT ANALYSIS

These charts show London is in a housing bubble and it’s going to pop – Business Insider
The FTSE decline has finally begun – MoneyWeek
Catalonia and the Move Against Empires – International Man
Have Commodities Reached an Inflection Point? – GoldSeek
Here’s How Much QE Helped Wall Street Steamroll Main Street – Bloomberg

Read more News & Commentary [17] on GoldCore.com

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