Archive for the ‘Europe’ Category
I’ve been warning people that all is not well in the world.
This morning I’m standing on the red button.
We are, right here and now, sitting on key support for copper. If it fails, and given the pattern I believe it will, we’re going under $3 and could see an all-on crash in copper prices.
Why is this important? Because it’s a measure of industrial demand — that is, industrial production on a global basis.
Europe is a damned basket case. That their markets haven’t collapsed are testament to the litany of lies promulgated by central bankers and politicians. But lies only are effective for a while and always eventually lose their luster.
Portugal is out of money. Spain’s pension system is effectively all in Spanish government debt; zero diversity. Ireland’s banking system, along with most of the rest of the continent, is about to roll over again and the idiots over in Europe, just as here, refused to force their banks to take the bogus leverage and swap crap out and shoot it after 2008. Politics trumped arithmetic — for a while.
But politics never wins over arithmetic in the end; it is a poor substitute for fact.
There will be more intervention — that much is a certainty. But note that even big companies like P&G are now extending payment for suppliers; the firm now wants 75 days to pay. What happened to 2% 10, Net 30? I’ll tell you what happened to it – it disappeared in a puff of bogus accounting games and “machined” earnings. When huge corporations start playing this game the end of the line has arrived.
Buried in that article is a nasty little ditty — major companies are now taking 60-100 days to pay. That’s outrageous.
What’s worse is the so-called “earnings surprises and beats.” Never-mentioned is the fact that companies have been buying back stock like crazy over the last few years, often with borrowed money rather than operating earnings. That is, they’re increasing leverage and then so-called “analysts” are screaming about how “cheap” their stock is. In a word:
Now we have a problem. The economy has rolled over in Europe and they are locked in a deep recession fed by Germany and to a lesser extent France — nations desperate to prevent their banks from being exposed as grossly insolvent. The ECB is going along with this because it has more worthless bonds in the kitty than its capital, which means that it is insolvent too.
The premise that Bernanke and the ECB have run is that low rates and “QE” style games will prompt a “recovery.” Five years+ into this mess that is now known factually to be a blown thesis!
But admitting the truth means accepting that we have in fact been in a grossly ugly recessionary — or even depression — environment for the last five years that has been intentionally and fraudulently covered up by artificially low rates, market distortions and deficit spending enabled by the chief drug pushers themselves. The political implications of doing that are unacceptable, so it doesn’t happen. Not here, not there.
It’s not helped by the fact that “new math” doesn’t bother to explain how exponents work in the real world despite the fact that every single 8th grader in the world should instantly recognize that the games being played both can’t and aren’t working.
China stoked their idiocy with ridiculous building for which there is no demand. All of that was fueled with cheap credit too, which is even easier to make happen in a communist nation. But the economic “expansion” that enabled this to happen without the BS ball going up and exploding is now slowing down as the weight of this lending presses its thumb on the scale. Within the next year or two that bubble should burst with catastrophic consequences. Never mind the internal and demographic problems.
Japan, for its part, thought it could “QE” its way to prosperity. The irony is that they have thought this for 20 years and it has failed. Their “big experiment” will also fail; their problems are structural and attempting to evade the decisions of 20 years previous in turning their banks into zombies — exactly as we’re doing here and Europe is doing there – cannot be backed out of the equation. There is a small element of panic showing up over in Japan already and that’s likely to grow.
Add to all of this the quiet repeal of the STOCK act here in America a few days ago. That’s right — while America was watching people get their legs blown off in Boston our Congress made legal once again insider trading by…. Congress. The “debate” over this change took a literal 10 seconds in the Senate and a whole 14 in the House. Neither chamber bothered with debate at all; it was passed by unanimous consent in both chambers.
All of those who claim to stand for transparency and proper government, including the man who I publicly supported for Congress in Michigan — Kerry Bentivolio: Go fuck yourselves. This is exactly the reason that nobody should respect any member of Congress, ever, period. Unanimous consent means just that – each and every member of Congress stands guilty of not only accepting but explicitly supporting insider trading by Congress.
One final fact: Artificially-low interest rates actually hurt lending. Why would you lend someone your capital for less than a reasonable return? There’s only way you’d do that — if someone else was backstopping your supposed “lending.” That’s what printing credit is all about if you’re “too big to fail”, but the fact of the matter is that the cost comes out of everyone’s pocket and as a result real firms with real prospects for real performance are shortchanged and those who would either be lenders at a market rate of return refuse to engage in the market.
Worse, those with good ideas refuse to hire and build businesses because those people, who actually can perform basic arithmetic and understand exponents, know they will get hammered to pay the bills for those who got uneconomic loans and will not be able to pay.
In this environment actual economic growth is factually impossible.
“Here it comes.”
The stock market is not crashing yet, but there are lots of other market crashes happening in the financial world right now. Just like we saw back in 2008, it is taking stocks a little bit of extra time to catch up with economic reality. But almost everywhere else you look, there are signs that a financial avalanche has begun. Bitcoins are crashing, gold and silver are plunging, the price of oil and the overall demand for energy continue to decline, markets all over Europe are collapsing and consumer confidence in the United States just had the biggest miss relative to expectations that has ever been recorded. In many ways, all of this is extremely reminiscent of 2008. Other than the Bitcoin collapse, almost everything else that is happening now also happened back then. So does that mean that a horrible stock market crash is coming as well? Without a doubt, one is coming at some point. The only question is whether it will be sooner or later. Meanwhile, there are a whole lot of other economic crashes that deserve out attention at the moment.
The following are 11 economic crashes that are happening RIGHT NOW…
As I write this, the price of Bitcoins has fallen more than 70 percentfrom where it was on Wednesday. This is one of the reasons why I have never recommended Bitcoins to anyone. Yes, alternative currencies are a good thing, but there are a lot of big problems with Bitcoins. Why would anyone want to invest in a currency that could lose 70 percent of its purchasing power in just two days? Why would anyone want to invest in a currency where a single person can arbitrarily decide to suspend trading in that currency at any time?
An article by Mike Adams of Natural News described some of the things that we have learned about Bitcoins this week…
#1) The bitcoin infrastructure cannot handle a selloff. Once the rush for the exits gains momentum, you will not be able to get out. Only those who sell early will be able to exit the market.
#2) The bitcoin infrastructure is subject to the whims of just one person running MTGox who can arbitrarily decide to shut it down whenever he thinks the market needs a “cooling period.” This is nearly equivalent to afinancial dictatorship where one person calls the shots.
#3) Every piece of bad news will be “spun” by exchanges like MTGox into good-sounding news. As bitcoin was crashing yesterday by 60% in value in mere hours, MTGox announced it was a “victim of our own success!” So while bitcoin holders watched $1 billion in market valuation evaporate, MTGox called it a success. Gee, then what would you call it when bitcoin loses 99%? A “raging” success?
The price of gold was down by about 4 percent on Friday. Gold has now fallen below $1500 an ounce for the first time since July 2011. Overall, the price of gold has fallen by about 10 percent since the beginning of the year, and it is about 22 percent below the record high set back in September 2011.
Yes, the price of gold is likely being pushed down by the banksters. And yes, gold is a fantastic investment for the long-term. But there will be times when the price of gold does fall dramatically just like we saw back in 2008.
The price of silver fell by about 5 percent on Friday. If it falls much more it is going to be at a level that presents a historically good buying opportunity.
Just like gold, there will be times when the price of silver swings dramatically. But the truth is that silver is probably an even better long-term investment than gold is.
The price of oil declined by about 3 percent on Friday. Many will consider this a positive thing, but just remember what happened back in 2008. Back then, the price of oil dropped like a rock. If the price of oil gets below $80, that could very well be a clear signal that a major economic crisis is about to happen.
#5 Consumer Confidence
As I mentioned above, consumer confidence in the U.S. just had its biggest miss relative to expectations that has ever been recorded. The following is from an article posted on Zero Hedge on Friday…
Well if this doesn’t send the market into all-time record high territory, nothing ever will: seconds ago the UMich Consumer Confidence plummeted from 78.6 to 72.3, on expectations of an unchanged 78.6 print. This was not only a 9 month low in the index, but more importantly the biggest miss to expectations in recorded history!
#6 Retirement Accounts
According to Wells Fargo, the number of Americans taking loans from their 401(k) accounts has risen by 28 percent over the past year…
Through an analysis of participants enrolled in Wells Fargo-administered defined contribution plans, the bank announced today that in the fourth quarter of 2012, there was a 28 percent increase in the number of people taking loans out from their 401(k) and that the average new loan balances increased to $7,126 from those taken out in the fourth quarter of 2011 – a 7% increase from $6,662.
Of the participants who took out loans, the greatest percentage were to people in their 50s (34.2%), followed by those in their 60s (28.9%) and then by those in their 40s (27.3%). The increase among participants in their 50s was nearly double the increase among those under 30. This is based on an analysis of a subset of 1.9 million eligible participants in retirement plans that Wells Fargo administers.
“The increased loan activity particularly among older participants is concerning because those are the years when workers can start to make ‘catch-up’ contributions and really need to focus on preparing for retirement,” said Laurie Nordquist, director of Wells Fargo Retirement.
#7 Casino Spending
Casino spending is declining again. Many people (including myself) would consider this to be a good thing, but casino spending is also one of the most reliable indicators about the overall health of the economy. Remember, casino spending crashed during the last financial crisis as well. That is why it is so alarming that casino spending is now back to levels that we have not seen since the last recession.
#8 Employment In Greece
Over in Europe, things just continue to get worse. According to numbers that were just released, the unemployment rate in Greece has soared to27.2 percent, which was up from 25.7 percent the previous month. That means that the unemployment rate in Greece rose by 1.5 percent in just a single month. That is not just a crash – that is an avalanche of unemployment.
#9 European Financial Stocks
European financial stocks have been hit particularly hard lately. And for good reason actually – most of the major banks in Europe are essentially insolvent at this point. This week, European financial stocks fell to seven month lows, and this is probably only just the beginning.
#10 Spanish Bankruptcies
According to Reuters, the number of Spanish companies going bankrupt has risen by 45 percent over the past year…
A record number of Spanish companies went bust in the first quarter of 2013 as companies remained under intense pressure from tight credit conditions and meager demand, a study showed on Monday.
The 2,564 firms filing for insolvency proceedings in first three months of the year was a 10 percent rise from the previous quarter and a 45 percent increase on the same period in 2012, the survey by credit rating agency Axesor said.
#11 Demand For Energy
Just like we saw back in 2008, the overall demand for energy in the United States is falling rapidly. There are some shocking charts that prove this that were recently posted on Zero Hedge that you can find right here.
Yes, it is good for people to use a bit less energy, but it is also a clear indication that economic activity is really starting to slow down.
But despite everything that you have just read, the Dow and the S&P 500 have been setting new record highs.
Fortunately, there are a few voices of reason out there. For example, just check out what Marc Faber recently told CNBC…
In the near-term, the U.S. stock market is overbought and adding that any more near-term gains portend big trouble for the market, “The Gloom, Boom & Doom Report” publisher Marc Faber told CNBC on Monday.
“If we continue to move up, the probability of a crash becomes higher,” Faber predicted in a “Squawk Box” interview, saying it could happen “sometime in the second half of this year.”
As I have written about previously, a bubble is always the biggest right before it bursts. I hope that we still have at least a little bit more time before it happens, but I wouldn’t count on it.
The economic fundamentals tell us that the stock market should be plunging, not rising. At some point the boys over on Wall Street will get the message and the market will catch up to reality very, very rapidly.
But for the moment, the American people are feeling really good. According to CNN, Americans are now more optimistic than they have been in six years…
As the stock market continues to show record highs, the number of Americans who say things are going well in the country has reached 50% for the first time in more than six years, according to a new national survey.
So what do you think will happen for the rest of the year?
Do you think that the good times will continue to roll, or do you believe that the bubble is about to burst?
When I first heard about the Cyprus ritual execution bailout, I had thought that the widespread predictions that the island nation’s economy would contract by 20% to 30% over the next two years were off base.
I thought it would happen much faster, on the order of two to three months. An estimated 45% (mind you, 45%!) of the economy is banking, and almost all of that international banking. So if you generously assume 200% of the 900% of GDP was bona fide domestic assets (remember you have a lot of retirees), the other 7/9 goes poof. And that’s before you get to the fact that a lot of the services provided to foreign customers (the higher-end accounting and legal services) will have no future in a purely domestic banking business. So assume 90% of that 45% disappears in short order.
That much of an economy vaporizing is a state change. It’s not clear how Cyprus can regroup or recover even if the surplus international banking types could decamp. How do natives, whose money is presumably entirely in Cyprus (assuming it was not devastated by the hits to depositors at Laiki and Bank of Cyprus) emigrate with capital controls? How can they get their money out to make a new start somewhere else, if that’s their inclination? Again, while the Cypriot government initially said that capital controls would only be in place a matter of day, no expert believes that. They anticipate they’ll be in place for years to keep the remaining deposits from vanishing.
I did not make predict the speed of decline because the my assessment seemed too extreme. Surely I was missing something. Even though it looked to me as if Germany had done the economic equivalent of nuking half the island, and there would be knock-on effects from that level of devastation, I figured I had to be missing something in terms of how quickly the bad effects would take hold.
Well, maybe not. Recall that we predicted that depositors of over €100,000 in Laiki, the number two bank, would be wiped out. Reuters tells us that depositors with over €100,000 in the biggest bank, Bank of Cyprus, will have no liquidity (see boldface):
Big depositors in Cyprus’s largest bank stand to lose far more than initially feared under a European Union rescue package to save the island from bankruptcy, a source with direct knowledge of the terms said on Friday.
Under conditions expected to be announced on Saturday, depositors in Bank of Cyprus will get shares in the bank worth 37.5 percent of their deposits over 100,000 euros, the source told Reuters, while the rest of their deposits may never be paid back…
Officials had previously spoken of a loss to big depositors of 30 to 40 percent….
At Bank of Cyprus, about 22.5 percent of deposits over 100,000 euros will attract no interest, the source said. The remaining 40 percent will continue to attract interest, but will not be repaid unless the bank does well.
The over €100,000 deposits in Laiki are gone.
At the Bank of Cyprus:
The 37.5% of >€100,000 deposits being converted to shares is a seriously out of the money option. What would you value that at? Not much.
40% won’t be accessible even under a best case scenario for years. The duration of time deposits is to be determined, and any returns depends on the bank’s performance. And of course, depositors may not get it all back.
The remaining 22.5% may or may not be available in two to three months.
The New York Times’ story is broadly consistent with the Reuters account, indicating that over 60% of deposits at the Bank of Cyprus could be toast:
Under the terms of the transaction, large depositors would have 77.5 percent of their savings turned into different forms of equity, with the rest remaining as a frozen, non-interest-bearing deposit that they would be able to access in the future.
If the bank does well, depositors would be able to sell their stock. But even in the best case, in which the bank thrives on the back of a quickly recovering economy — a long shot most economists believe — the loss is likely to exceed 60 percent and could well be much more than that.
Lawyers and bankers who have analyzed the transaction believe the ultimate loss to the depositor could be anywhere between 60 and 77.5 percent.
Notice that the Times doesn’t buy the effort to pass off the “term deposit” that you maybe never see again and whose payout depends on performance as anything other than equity. It is silent on what happens to the remaining 22.5%. It does point out that nothing has been announced and final terms may therefore differ from the rumors.
Now remember, Laiki and Bank of Cyprus were the core of the payments system in Cyprus. And it would be very difficult for a business of meaningful size not to have over €100,000 in deposits. If you freeze a significant majority of the commercial balances, how can you operate? How can these businesses even survive and pay each other? By e-mail, Antonis Polemitis of Ledra Capital teased out the implications:
If the Reuters story is correct, for the purposes of liquidity on Tuesday morning, that is a 100% haircut.
If that is what they do, I am not sure how Cyprus can engage in economic activity on Tuesday without going to barter or scrips.
I mean, that basically will mean 100% of the large deposits (all the business accounts) at Laiki and BoC are lost or not available as of next week. The Laiki wipe out may have been survivable. If you wipe (for liquidity purposes at least), both Laiki and BoC, then we are not talking about whether or not GDP drops X%, we are talking about ‘how do you actually engage in commerce?’
If they do this, there is little chance it can last more than a month — the economy will simply fail at even basic functions…
And if the plan has been accurately reported and plays out as Polemitis fears, it will undermine the “Cyprus is a special case” narrative. This Eurozone fiasco is making Geithner look good. The former Treasury secretary used the need to keep the confidence fairy alive as the excuse for any and every sop to the banks, from coddling miscreant executives to foaming the runway with mortgage borrowers to stealth bailouts. But the Eurocrats have completely ignored the impact of undermining confidence in the banking system. The fact that Cyprus has a decent-sized population of English retirees means that the British media will report on the Cyprus meltdown, which will be a stark contrast with Greece, where the economic devastation has not gotten the coverage it warrants. Grim accounts of the destruction wrought by the tender ministrations of the Troika should strengthen the position of the growing Euroskeptic sentiment in Italy, borne out by the success of Berlusconi and Grillo in the recent elections. Playing into the hands of Italian refuseniks should be the last thing Brussels and Berlin want. The cost of getting tough with Cyprus is likely to be far greater than they anticipate.
A couple of points.
All lending to a sovereign is inherently unsecured. Contracts aside, there’s the problem of guns, and the government always seems to have more of them than the creditors do. Never mind that it’s relatively rare for lending to a sovereign to be backed by anything more than the “full faith and credit” of the government itself, which it can (of course) disavow. Remember that no Congress can bind the next one; this generally applies across the globe.
Alliances are always available should you find yourself in serious trouble. Cyprus, in particular, has suspected (but unproved) massive gas reserves and happens to have territorial waters through which people may wish to pass pipelines and similar things. Europe has a wee problem with this at present in terms of its energy infrastructure and requirements, and is largely dependent upon Russia. Cyprus has quite the whip hand, should it choose to exercise it following a departure from the EU.
Sovereigns have the privilege — and duty — of seigniorage. Duty? Why, yes. Privilege in that they have the right to issue into an expanding economy in order to balance output and keep the monetary unit stable, duty in that they have the responsibility to remove same during economic contractions so as to also keep the monetary unit stable. The EU is a failed system because it does not recognize this balance of right and responsibility and due to structural imbalances creates a forced subsidy model instead. This is an inherently unstable situation but neither Brussels or the periphery want to deal with it. The periphery has enjoyed quite a bit of these effects for years, but now the costs are biting hard.
IMHO the proper action is for Cyprus to tell the EU and ECB to bite it. Germany says:
“Cyprus has it in its own hands to prevent the state’s bankruptcy but time is running out,” said Hans Michelbach, a German lawmaker and ally of Chancellor Angela Merkel.
Germany has no right to dictate anything to Cyprus. Indeed, Germany and the ECB, along with the machinery at the EU, is at least as responsible for this problem as is the government of Cyprus, if not more so, as they have all failed in their supervision of these banking institutions for sufficient capital.
Let us not forget that these banks passed ”Stress Tests” from the ECB; they were thus claimed to be sound. The ECB should be told to suck it up and eat the consequence of their claimed “soundness”, in this case to the tune of the required €7 billion or so, for they did not flag the banks as unsound or demand they be closed before they exhausted their bondholder capital.
More to the point is that there is yet more gaming going on in this regard with the capital structure with the incessant reports that the real problem isn’t that the bondholder equity is exhausted — it is that with the deterioration that has occurred resolution of the institutions would cause the bondholders to take losses and that’s unacceptable. This, however, is at odds with the very capital structure and its definition.
In short this is the case of the ECB and certain EU members putting a gun to the head of a sovereign nation and demanding that they rob their people to protect those who invested knowing there was a risk of loss from the consequences of their bad investment.
Cyprus’ response to that ought to be exactly this:
And if the ECB and EU want to press the issue then do what Iceland did; tell the ECB and EU to stick it where the sun doesn’t shine, issueindictments against the Troika’s members for extortion and criminal fraud (prohibiting them from entering Cyprus — ever — unless they’d like to spend the rest of their lives in prison) and resolve the institutions forcing the losses on the bondholders but protecting the depositors.
Then trace all the criminal activity in these banks and where there is evidence of fraud or other criminal activity by other financial institutions interconnected with Cyprus issue criminal indictments against both the banks and the executives.
This has a decent shot at winding up with Cyprus leaving the EU. So what? Cyprus would get their national sovereignty back and given that they’re sitting on a bunch of natural gas deposits while the short-term pain would be considerable in the intermediate term they would wind up the winner, much as Iceland has.
The futures are open and down by 15, which doesn’t sound like much (about 1%)
The problem isn’t the magnitude of the drop. It’s the principle of the matter — Cyprus told its residents recently that there was no contemplation of taking bank deposits.
Bluntly, they lied.
Remember that Euro Zone depositors allegedly have bank account insurance just like we do with the FDIC in the United States. Their funds are supposed to be guaranteed by their respective governments.
Instead they are being stolen to bail out both outrageous speculation and rank malfeasance by government regulators who failed to shut these banks down before they invaded their depositor capital, an act that any reasonable person would consider grand larceny and an outrageous felony for which people should literally hang.
The problem is that all the politicians lie. Obama lies. Boehner lies. Reid lies. Pelosi lies. Merkel lies.
They all lie and in fact all they do is lie!
As we saw last week in the Senate Subcommittee hearing the entire “London Whale” scheme was a litany of lies, obfuscations and regulators ducking their jobs, despite virtually everyone admitting that they knew there was something wrong.
Nobody who lies pays, you see; the common man is the only one who pays.
And he pays so those who lie can loot, cheat and steal — and get away with it.
Confidence is a funny thing. People will stand for just about anything for quite some time, but eventually they have had enough and confidence breaks. When it breaks it does so suddenly, without warning.
Is this “the event”?
Who the hell knows.
What I do know with certainly is this: Unless the liars, cheats and scammers start facing the music — indictments, prosecutions and prison sentences, instead of being given license by the government to loot the people in furtherance of their schemes, confidence will inevitably be lost.
We’re well past the point where we should have had heads on pikes through lawful process.
We haven’t gotten that and there’s no indication that it’s going to happen either, despite the claims of many in Government and elsewhere.
Time is quickly running out for the process to remain peaceful and lawful. What comes next is something nobody who is sane wants to see, but if there is no change in the immediate future in the behavior of our national governments it is, unfortunately, inevitable.
BOE Warns An Imminent Private Equity Crash, China Just Sounded a Warning Bell For What’s Coming Our Way, Morgan Stanley: The Central-Bank-Inspired “Omnishambles” Is Closer Than Most Think, DEUTSCHE BANK: Only Jesus Can Save The Euro Area
Bank of England fears that larger private equity deals done in the boom years ‘pose a risk to the stability of the financial system’ as refinancing looms
The Bank of England warned on Thursday that the next phase of the UK’s six-year financial and economic crisis may be triggered by the collapse of debt-laden companies bought by private equity firms in the boom years before the crash.
In its latest quarterly bulletin, Threadneedle Street said the need over the next year to refinance firms subject to heavily leveraged buyouts posed a systemic threat.
The Bank added that it would use its new role as the watchdog of the City to monitor private equity deals in future “episodes of exuberance” to prevent a repeat of the debt-driven takeover boom in the run-up to the banking crisis.
“In the mid-2000s, there was a dramatic increase in acquisitions of UK companies by private equity funds,” the Bank said.
It seems more likely to Morgan Stanley’s Gerard Minack that central bankers may win the battle: sustaining recovery in developed economies with extraordinarily loose monetary policy. For a while this would go hand-in-hand with better equity performance. The battle is against a crisis caused by too loose monetary policy, elevated debt and mis-priced risk. Ironically, he notes, central bankers may overcome these problems by running even looser monetary policy, encouraging a new round of levering up, and fresh mis-pricing of risk. However, winning the battle isn’t winning the war. If central bankers do win this round, the next downturn could be, in Minack’s view, an omnishambles. In short, it seems more likely that central bankers may add another leg to the credit super-cycle. The key question for investors in this scenario is when (and how) this cycle may end, and Minack’s hunch is that this cycle is already closer to 2006 than 2003.
Let’s wind the clock back to 2008.
The world was thought to be ending. Lehman went bust. Markets were plunging. Everyone was scared that growth was over. It was as though the global economy was grinding to a halt.
But then China’s stock market bottomed. The Chinese Government announced a massive stimulus plan to turn its economy around. And sure enough the Chinese economy took off again.
A few months later, the US markets bottomed courtesy of extraordinary stimulus from the US Federal Reserve. Three months after that, the US economy was showing what everyone claimed were “green shoots.”
And the world began to gradually shift towards growth and increased confidence.
Why do I bring all of this up? Because it was China’s stimulus and China’s economy that supposedly lead the world back towards growth again. China is the proverbial canary in the coalmine, the economy that most quickly reveals what’s coming and where we’re all heading…
Well, China’s heading for inflation.
China should be on “high alert” over inflation after February’s figures exceeded forecasts, central bank Governor Zhou Xiaochuan said, signaling a heightened focus on controlling prices.
Monetary policy is “no longer relaxed” and is “relatively neutral” as demonstrated by a 13 percent target for money-supply growth that’s tighter than expansion in the last two years, Zhou, head of the People’s Bank of China, said at a press conference today during the annual gathering of China’s National People’s Congress…
“The central bank has always attached great importance to consumer prices,” Zhou said. “Therefore we will use monetary policy and other measures to hopefully stabilize prices and inflation expectations.”
China’s new leaders including Li Keqiang, set to become premier this week, inherit the task of sustaining a recovery from the slowest growth in 13 years while reining in asset prices and credit. February inflation, distorted by the weeklong Lunar New Year holiday, accelerated to a 10-month-high of 3.2 percent.
The bank’s research department transcribed Hafeez’s speech and sent it out to clients in a note.
The speech focuses on the euro area’s economic woes and the need for the currency bloc to move forward with further integration in order to be economically successful.
Hafeez opens the speech with a reflection on parenting and a child’s years as a “terrible teen.”
The gist is that euro member states are behaving like infighting teens – which is preventing further integration – and they need a role model that everyone across Europe can respect.
“I can only think of one figure that is respected by most Europeans and has never sinned, Jesus!” said Hafeez.
Japan is falling on their sword for the good of the NY & London criminal banksters by purchasing their worthless derivatives.
The Japanese have decided to perform Hari-kari on themselves and disembowel their economy on a global stage. In what can only be described as willful suicide, the BOJ has decided to begin buying derivatives. The most volatile financial weapon of mass destruction will be purchased by the Japanese, the question is why?
As the US economy continues its death spiral, Japan has been ordered to jump on the grenade and keep the dollar charade going for just a little bit longer.
Japan is finished, energy and food prices are through the roof and they are moving from the lost decades to being the lost civilization.