Budget Deficit

Donald Trump Is Right: Here Are 100 Reasons Why We Need To Audit The Federal Reserve

When a leading nominee for President gets something exactly right, we should applaud them for it.  In this case, Donald Trump’s call to audit the Federal Reserve is dead on correct.  Most Americans don’t realize this, but the Federal Reserve has far more power over the economy than anyone else does – including Barack Obama.  The funny thing is that the Federal Reserve is not even part of the federal government.  It is an independent private central bank that was designed by very powerful Wall Street interests a little over 100 years ago.  It is at the heart of the debt-based financial system which is eating away at America like cancer, and it has no direct accountability to the American people whatsoever.

Iraq On The Brink Of Chaos As Oil Revenues Fall

Nowhere are the stakes higher than in Iraq, and selling oil at half the price it would take to just break even could break this giant’s back. It certainly isn’t enough to stave off the unrest in Basra, not to mention the ISIS threat.

The Four Horsemen Of Economic Apocalypse Are Here

"...the economic patient is riddled with cancer - central banks are applying a defibrillator, but there's only so much electricity the patient can take before it becomes a burnt-out corpse."

DeBeers Cartel Deathwatch: Russia Set To Flood Diamond Market With Firesale Of 167,500 Carats

First it was the OPEC oil cartel which died a slow, painful, death. Now, another historic cartel may be on its last legs: the DeBeers diamond cartel, because according to Russian daily Izvestia, as part of Russia plan to combat its creeping budget deficit, Russia’s state minerals depository, Gokhran, will conduct two auctions on February 29 and March 10, in which it plans to sell as much as 167,500 carats of diamonds.

America's National Debt Bomb Caused By The Welfare State

The news is filled with the everyday zigzags of those competing against each other for the Democrat and Republican Party nominations to run for the presidency of the United States. But one of the most important issues receiving little or no attention in this circus of political power lusting is the long-term danger from the huge and rising Federal government debt.

Crude Sinks To Day Lows After Goldman Explains Why No Oil Production Cuts Are Coming

"Despite the sharp bounce in oil prices that these headlines generated, we do not expect such a cut will occur unless global growth weakens sharply from current levels, which is not our economists' forecast. This view is anchored by our belief that such a cut would be self-defeating given the short-cycle of shale production and the only nascent non-OPEC supply response to OPEC's November 2014 decision to maximize long-term revenues."

"Time To Panic"? Nigeria Begs World Bank For Massive Loan As Dollar Reserves Dry Up

Having urged "don't panic" just 4 short months ago, it appears Nigeria just did just that as the global dollar short squeeze forces the eight-month-old government of President Muhammadu Buhari to beg The World Bank and African Development Bank for $3.5bn in emergency loans to help fund a $15bn deficit in a budget heavy on public spending amid collapsing oil revenues. Just as we warned in December, the dollar shortage has arrived, perhaps now is time to panic after all.

Norway's Kroner Conundrum Deepens As Central Bank Buys Record Amount Of Currency

This is the paradox for Norway: the country needs to buy NOK in order to fund stimulus and support the economy. But by doing so, the Norges Bank is putting upward pressure on the currency at a time when it really needs to depreciate. In other words, what Norway must do to pay for stimulus (buy kroner) is indirectly hurting the economy by keeping the NOK from depreciating and functioning as a counter cyclical buffer.

Saudi Arabia Hemorrhages $19.4 Billion In Reserves During December

Saudi Arabia - which was busy playing headline hockey with Russia this morning over a rumored 5% production cut proposal - is running out of money. Yes, we know, that sounds absurd. But believe it or not, the country whose monarch recently rented the entire Four Seasons hotel for a 48 hour stay in Washington DC, is in fact going broke. And at a fairly rapid clip.

Italian Banks Sink As "Bad Bank" Plan Underwhelms

Last week, we noted that Italy is rushing to defuse a €200 billion time bomb in the country’s banking sector as investors fret over banks’ exposure to souring loans. On Wednesday we learn that Italy has indeed managed to strike a deal with Brussels to help alleviate banks’ NPL burden but the agreement falls well short of the type of comprehensive "solution" the market was hoping to see.