Chinese markets bounced last night following drastic intervention by the state when it banned large players from selling their shares in listed companies – arresting the over 30% decline of the past four weeks.
Markets have begun seizing up as sellers overwhelm the system. The China Securities Regulatory Commission, has described market participants as being “irrationally” driven by “panic sentiment” despite there having been no rational basis for the run up in Chinese markets before they peaked last month.
“Wake up, people of the world and investors! Greece will come to your neighbourhood very soon, maybe not this year but next year or whenever…because the world is over-indebted and defaults will follow or they’ll have to create very high inflation rates”.
Like a game of chess Tsipras may have just sacrificed a knight in order to achieve a greater strategic aim – the marketing of a compromise deal to highly sceptical northern European countries. Were Greece to be expelled, and our television screens filled with Greek humanitarian causes, the likelihood of any euro nation passing additional powers to an increasingly European feckless elite has become essentially zero.
With all eyes on Greece it would seem another crisis relating to unpayable debt is brewing in the Caribbean. The governor of Puerto Rico, Alejandro García Padilla, has warned that the island is unable to pay its debts of $72 billion.
With the ECB reneging on its responsibility as lender of last resort – not the first time it has used its power to political ends in Greece – Greek banks may soon be forced to“bail-in” deposits– i.e. confiscate the cash of their customers.
All banks and the Greek stock exchange are closed today. Greek citizens cued in long lines at ATMs or cash machines over the weekend and a run on the banks left most ATMs empty. There is a €60 limit on withdrawals from cash machines under strict capital controls.
Relative to the monetary base, the gold price is currently at an all time low. In our opinion, this is a temporary anomaly, which we believe provides an extraordinarily favorable buying opportunity.
Shanghai Gold Exchange volume climbed to a record today as prices declined incentivizing value driven Chinese buyers as Chinese stocks crashed 7.4%. Chinese stocks have had the biggest two-week loss in more than 18 years and are close to entering a bear market after extending losses from their June 12 peak to 19 percent in less than three weeks.
Ron Paul, former congressman for Texas, laid plain the absurdity of central policy towards the markets in a recent interview with Amanda Diaz on CNBC. He believes a day of reckoning is in the cards because the central banks “can’t print money forever.”
- We need a free market in currencies, not bail-ins and a war on cash and gold - People blindly trust “experts” so welcome that some of them giving prudent advice regarding diversification - Currencies of creditor nations – Norway, Switzerland, Singapore, Hong Kong will outperform in long term
- Doubts over City of London’s “fintech” in age of cyber war - Thousands left in “financial limbo” after tech “error” - 600,000 RBS customer payments go "missing" in "system failure”
A fund manager for one of the largest mutual fund and investment groups in the world, Fidelity, has warned investors and savers to have an allocation to “physical cash,” “including precious metals” to protect against "systemic risk".
A Greek exit from the euro would change everything. The greatest change being simply doubt and fear regarding the outlook for other vulnerable EU nations, EU banks and the EU banking and financial system. We discuss short and long term considerations, best and case outcomes, and wealth preservation strategies.
Gold aided by a softer dollar, the Greek debt debacle and the U.S. Federal Reserve chairperson, Janet Yellen’s dovish comments from this week’s monetary policy statement.
