The European debt crisis has just gone to an entirely new level. Just when it seemed like things may be stabilizing somewhat, we get news of huge financial bombs being dropped all over Europe. Very shortly after U.S. financial markets closed on Friday, S&P announced credit downgrades for nine European nations. This included both France and Austria losing their cherished AAA credit ratings. When the credit rating of a country gets slashed, that is a signal to investors that they should start demanding higher interest rates when they invest in the debt of that nation. Over the past year it has become significantly more expensive for many European nations to borrow money, and these new credit downgrades certainly are certainly not going to help matters. Quite a few financially troubled nations in Europe are very dependent on the ability to borrow huge piles of cheap money, and as debt becomes more expensive that is going to push many of them over the edge. Yesterday I wrote about 22 signs that we are on the verge of a devastating global recession, and unfortunately that list just got a whole lot longer.
Over the past several months we have seen quite a few credit downgrades all over Europe, but we have never seen anything quite like what S&P just did. Standard & Poor’s unleashed a barrage of credit downgrades on Friday....
16 January 2012
22 Signs That We Are On The Verge Of A Devastating Global Recession
2012 is shaping up to be a very tough year for the global economy. All over the world there are signs that economic activity is significantly slowing down. Many of these signs are detailed later on in this article. But most people don't understand what is happening because they don't put all of the pieces together. If you just look at one or two pieces of data, it may not seem that impressive. But when you examine all of the pieces of evidence that we are on the verge of a devastating global recession all at once, it paints a very frightening picture. Asia is slowing down, Europe is slowing down and there are lots of trouble signs for the U.S. economy. It has gotten to a point where the global debt crisis is almost ready to boil over, and nobody is quite sure what is going to happen next. The last global recession was absolutely nightmarish, and we should all hope that we don't see another one like that any time soon. Unfortunately, things do not look good at this point.
24 Statistics To Show To Anyone Who Believes That America Has A Bright Economic Future
Beware of bubbles of false hope. Right now there is a lot of talk about how the U.S. economy is improving, but it is all a lie. The mainstream media can be very seductive. When you sit down to watch television your brain tends to go into a very relaxed mode. In such a state, it becomes easy to slip thoughts and ideas past your defenses. Sometimes when I am watching television I realize what the media is trying to do and yet I can still feel it happening to me. In this day and age, it is absolutely critical that we all think for ourselves. When you look at the long-term trends and the long-term numbers, a much different picture of the U.S economy emerges than the one that is painted for us on television. Over the long-term, the number of good jobs in America has been steadily going down. Over the long-term, the number of Americans living in poverty and living on food stamps has been steadily going up. Over the past couple of decades, tens of thousands of businesses, millions of jobs and trillions of dollars of our national wealth have gone out of the country. Our debt is nearly 15 times larger than it was 30 years ago, and U.S. consumer debt has soared by 1700% over the past 40 years. Year after year the rate of inflation goes up faster than our incomes do, and this is absolutely devastating the middle class. Anyone who believes that we can keep doing the same things that we have been doing and yet America will still have a bright economic future is delusional. Until the long-term trends which are taking the U.S. economy straight into the toilet are reversed, any talk of a bright economic future is absolute nonsense.
EFSF Text On Standard & Poors Downgrade Of Long-Term Rating
LUXEMBOURG (MNI) Following is a statement by the European Financial Stability Facility (EFSF) released Monday on the downgrade by Standard & Poor's:
"EFSF takes note of the decision by Standard and Poor's to downgrade the EFSF's long-term rating to AA+.
"EFSF takes note of the decision by Standard and Poor's to downgrade the EFSF's long-term rating to AA+.
Noyer: Banks Must Use ECB Liquidity to Finance EMU Economy
Monday, January 16, 2012 - 12:34
PARIS (MNI) - The European Central Bank will continue to provide liquidity to the Eurozone economy and banks must do their part by lending to business, ECB Governing Council member Christian Noyer said Monday.
The ECB will continue its "determined action to counter abnormal market trends and to ensure the best transmission possible of monetary policy," the governor of the Bank of France said in his New Year's greeting to the French financial establishment.
"Our decision to loosen collateral eligibility criteria for refinancing operations also demonstrates our firm resolution to support financing of the economy," he said.
PARIS (MNI) - The European Central Bank will continue to provide liquidity to the Eurozone economy and banks must do their part by lending to business, ECB Governing Council member Christian Noyer said Monday.
The ECB will continue its "determined action to counter abnormal market trends and to ensure the best transmission possible of monetary policy," the governor of the Bank of France said in his New Year's greeting to the French financial establishment.
"Our decision to loosen collateral eligibility criteria for refinancing operations also demonstrates our firm resolution to support financing of the economy," he said.
Secrets of the Fed Editorial of The New York Sun | January 15, 2012
The Fed is starting to remind people of Woodrow Wilson’s son-in-law, William Gibbs McAdoo. We had a note about McAdoo over the weekend from James Grant, editor of the Interest Rate Observer. It seems that McAdoo, during his campaign for the Democratic presidential nomination in 1924, kept putting his foot in his mouth. “What your friends want out of you is silence,” one of McAdoo’s supporters supposedly told him, “— and damn little of that.” Our sentiments exactly. The Federal Reserve, not to mention the rest of us, would be better off without the all the words that pour from its transcripts, press conferences, and minutes. After the release of the transcripts this week, the New York Times quoted one professor, Justin Wolfers of the Unviersity of Pennsylvania, as saying the latest disclosures were embarrassing not only for the Fed but for all of economics. In any event, the Fed’s words are a poor excuse for money. We say: Let the Fed stand mute. For however much time we still have a Fed, let us discover its policies the way we discover the properties of a black hole, not by the light that comes out — none does — but by the behavior of nearby objects. It would be more credible for the Fed and more efficient for the market, until the day comes when we can get back to constitutional money defined as a given number of grains of specie.
Greece to default following downgrades, says Bill Gross
Source: BI-ME with Bloomberg , Author: Posted by BI-ME staff
Posted: Mon January 16, 2012 12:45 pm
INTERNATIONAL. Bill Gross, who runs the world's biggest bond fund at Pacific Investment Management Co., said Greece is heading for default.
The downgrade of European ratings by Standard & Poor’s last week shows countries can fail to meet their debt obligations, Gross said in a Twitter posting. Greece will prove to be the latest example, Gross wrote.
Greek officials will meet with lenders on Jan. 18 after discussions stalled last week over the size of investor losses in a proposed debt swap, raising the threat of default. European officials and creditors plan a 50 percent cut in the face value of Greek debt by voluntarily exchanging outstanding bonds for new securities, though the two sides haven’t been able to agree on the coupon and maturity of the new debt.
Posted: Mon January 16, 2012 12:45 pm
INTERNATIONAL. Bill Gross, who runs the world's biggest bond fund at Pacific Investment Management Co., said Greece is heading for default.
The downgrade of European ratings by Standard & Poor’s last week shows countries can fail to meet their debt obligations, Gross said in a Twitter posting. Greece will prove to be the latest example, Gross wrote.
Greek officials will meet with lenders on Jan. 18 after discussions stalled last week over the size of investor losses in a proposed debt swap, raising the threat of default. European officials and creditors plan a 50 percent cut in the face value of Greek debt by voluntarily exchanging outstanding bonds for new securities, though the two sides haven’t been able to agree on the coupon and maturity of the new debt.
Housing and Oil: Dark Inventory Rules
Ilargi: I'd like to try a little intellectual exercise. There were two pieces in my mailbox this week that concerned posts at Naked Capitalism. Though their topics have at first glance little to do with one another, there is a term that is pivotal to both. Inventory.
When it comes to real estate, it's popularly called "shadow inventory". With regards to commodities, the term "dark inventory" has been coined. While there are plenty of differences in the way the terms are applied, I'm for now intrigued more by - potential - similarities between them.
Not that I have the illusion that I can treat this in a way that could even border on comprehensive, don't get me wrong. I want to lift only part of the veil that hides from view what underlies how and why the financial system that rules our economies is going to the dogs: market manipulation.
In particular, I'm interested in how both shadow and dark inventory phenomena pervert their respective markets, as well as the entire free market system as a whole, where everyone is supposed to have "full access to information". Something both dark and shadow inventories make impossible. Something the 99% general public are not aware of. At all.
And it's not like they're alone. Try your average pension fund manager, banker, politician. Not a clue.
Let' start with a trip back to June 2011, when Izabella Kaminska for FT Alphaville perhaps first used the term "dark inventory":
When it comes to real estate, it's popularly called "shadow inventory". With regards to commodities, the term "dark inventory" has been coined. While there are plenty of differences in the way the terms are applied, I'm for now intrigued more by - potential - similarities between them.
Not that I have the illusion that I can treat this in a way that could even border on comprehensive, don't get me wrong. I want to lift only part of the veil that hides from view what underlies how and why the financial system that rules our economies is going to the dogs: market manipulation.
In particular, I'm interested in how both shadow and dark inventory phenomena pervert their respective markets, as well as the entire free market system as a whole, where everyone is supposed to have "full access to information". Something both dark and shadow inventories make impossible. Something the 99% general public are not aware of. At all.
And it's not like they're alone. Try your average pension fund manager, banker, politician. Not a clue.
Let' start with a trip back to June 2011, when Izabella Kaminska for FT Alphaville perhaps first used the term "dark inventory":
How Long Until People Raise The Alarm About Britain?
The Automatic Earth | Jan. 16, 2012, 8:48 AM
There is a relative silence in the international financial press when it comes to Britain.
The economic situation of continental Europe gets almost all the attention.
Every now and then someone in France or Germany states that Britain, too, should be downgraded, like when S&P cut the ratings of 9 European countries, but such statements attract hardly any interest at all. This might not be overly wise, though.
At the end of last year, Tyler Durden at ZeroHedge published a graph from Haver Analytics/Morgan Stanley that should probably have sounded alarm bells quite a bit louder than it did.
Still, this graph would seem to indicate that the only core issue in the UK is its outsize financial sector with its outsize debt. From time to time, however, news articles pop up that seem to indicate there's more going on than trouble in the City of London.
There is a relative silence in the international financial press when it comes to Britain.
The economic situation of continental Europe gets almost all the attention.
Every now and then someone in France or Germany states that Britain, too, should be downgraded, like when S&P cut the ratings of 9 European countries, but such statements attract hardly any interest at all. This might not be overly wise, though.
At the end of last year, Tyler Durden at ZeroHedge published a graph from Haver Analytics/Morgan Stanley that should probably have sounded alarm bells quite a bit louder than it did.
Still, this graph would seem to indicate that the only core issue in the UK is its outsize financial sector with its outsize debt. From time to time, however, news articles pop up that seem to indicate there's more going on than trouble in the City of London.
Buy Gold: It's oversold, loathed, near major lows
By Adam Hamilton
Since rocketing to new all-time highs last summer, Gold has weathered a major correction. While that selloff was healthy and necessary given the excessive optimism that catapulted gold to very-overbought levels, a strong US dollar accelerated gold's swoon. But with the dollar now as overbought and wildly popular as gold was in August, this currency itself is due for a major selloff that is likely to launch gold.
Since rocketing to new all-time highs last summer, Gold has weathered a major correction. While that selloff was healthy and necessary given the excessive optimism that catapulted gold to very-overbought levels, a strong US dollar accelerated gold's swoon. But with the dollar now as overbought and wildly popular as gold was in August, this currency itself is due for a major selloff that is likely to launch gold.
Hizballah planned Mumbai-style attack on Habad Bangkok, Khao San restaurants
DEBKAfile Special Report January 16, 2012, 1:22 PM (GMT+02:00)
The Thai police's capture of a Lebanese-Swedish Hizballah suspect, who was charged Monday, Jan. 16, thwarted a terrorist attack on Bet Habad in Bangkok, involving the taking of hostages and blowing up the building. It was to have followed the same lines as al Qaeda's 2008 assault on the Mumbai Habad center which killed 8 Israelis and Jews - only more ambitious. The Habad Bangkok is much larger: its hostel has rooms for dozens of lodgers. A second team was to have hit the Khao San Road restaurants popular with Israelis and Americans in a coordinated operation.
This is the first time Western and Israeli agencies have found evidence of the Lebanese Shiite Hizballah using and training operatives in the same terrorist methods as al Qaeda.
debkafile's counter-terror sources note that two or possibly three Hizballah cells were to have gone into coordinated action on the same date this month. The only suspect in Thai custody is Atris Hussein, 47, who was arrested as soon as he landed at Bangkok international airport Thursday, Jan. 12.
The Thai police's capture of a Lebanese-Swedish Hizballah suspect, who was charged Monday, Jan. 16, thwarted a terrorist attack on Bet Habad in Bangkok, involving the taking of hostages and blowing up the building. It was to have followed the same lines as al Qaeda's 2008 assault on the Mumbai Habad center which killed 8 Israelis and Jews - only more ambitious. The Habad Bangkok is much larger: its hostel has rooms for dozens of lodgers. A second team was to have hit the Khao San Road restaurants popular with Israelis and Americans in a coordinated operation.
This is the first time Western and Israeli agencies have found evidence of the Lebanese Shiite Hizballah using and training operatives in the same terrorist methods as al Qaeda.
debkafile's counter-terror sources note that two or possibly three Hizballah cells were to have gone into coordinated action on the same date this month. The only suspect in Thai custody is Atris Hussein, 47, who was arrested as soon as he landed at Bangkok international airport Thursday, Jan. 12.
US, Israel in open rift over Iran: Big joint military drill cancelled
DEBKAfile Exclusive Analysis January 15, 2012, 3:31 PM (GMT+02:00)
US-Israeli discord over action against Iran went into overdrive Sunday, Jan. 15 when the White House called off Austere Challenge 12, the biggest joint war game the US and Israel have every staged, ready to go in spring, in reprisal for a comment by Israeli Deputy Prime Minister Moshe Yaalon in an early morning radio interview. He said the United States was hesitant over sanctions against Iran's central bank and oil for fear of a spike in oil prices.
The row between Washington and Jerusalem is now in the open, undoubtedly causing celebration in Tehran.
Nothing was said about the 9,000 US troops who landed in Israeli earlier this month for a lengthy stay. Neither was the forthcoming visit by Gen. Martin Dempsey, Chairman of the Joint US Chiefs of Staff, Thursday mentioned.
The exercise was officially postponed from spring 2012 to the last quarter of the year over "budgetary constraints" – an obvous diplomatic locution for cancellation. It was issued urgently at an unusually early hour Washington time, say debkafile's sources, to underscore the Obama administration's total disassociation from any preparations to strike Iran and to stress its position that if an attack took place, Israel alone would be accountable.
US-Israeli discord over action against Iran went into overdrive Sunday, Jan. 15 when the White House called off Austere Challenge 12, the biggest joint war game the US and Israel have every staged, ready to go in spring, in reprisal for a comment by Israeli Deputy Prime Minister Moshe Yaalon in an early morning radio interview. He said the United States was hesitant over sanctions against Iran's central bank and oil for fear of a spike in oil prices.
The row between Washington and Jerusalem is now in the open, undoubtedly causing celebration in Tehran.
Nothing was said about the 9,000 US troops who landed in Israeli earlier this month for a lengthy stay. Neither was the forthcoming visit by Gen. Martin Dempsey, Chairman of the Joint US Chiefs of Staff, Thursday mentioned.
The exercise was officially postponed from spring 2012 to the last quarter of the year over "budgetary constraints" – an obvous diplomatic locution for cancellation. It was issued urgently at an unusually early hour Washington time, say debkafile's sources, to underscore the Obama administration's total disassociation from any preparations to strike Iran and to stress its position that if an attack took place, Israel alone would be accountable.
US Backs Off Iran Attack?
Massive joint US-Israeli drill postponed
Paul Joseph Watson
Infowars.com
Monday, January 16, 2012
Paul Joseph Watson
Infowars.com
Monday, January 16, 2012
The United States has cancelled a joint military exercise with Israel in a move some analysts are saying could represent a reluctance to support an attack on Iran.
“Israel and the United States have postponed a massive joint defense exercise, which was expected to be carried out in the coming weeks, in order to avoid an escalation with Iran,” reports Haaretz.
Although the United States has already sent 9,000 troops to Israel, a move described as a “deployment” rather than an exercise by US Commander Lt.-Gen Frank Gorenc, the Austere Challenge 12 drill, intended to be a wargame response to missiles fired by Iran, has now been postponed until the summer.
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Everything You Need to Know About Wall Street, in One Brief Tale
POSTED: January 13, 9:15 AM ET
If there was ever a news story that crystalized the moral dementia of modern Wall Street in one little vignette, this is it.
Newspapers in Colorado today are reporting that the elegant Hotel Jerome in Aspen, Colorado, will be closed to the public from today through Monday at noon.
Why? Because a local squire has apparently decided to rent out all 94 rooms of the hotel for three-plus days for his daughter’s Bat Mitzvah.
The hotel’s general manager, Tony DiLucia, would say only that the party was being thrown by a "nice family," but newspapers are now reporting that the Daddy of the lucky little gal is one Jeffrey Verschleiser, currently an executive with Goldman, Sachs.
At first, I couldn't remember how I knew that name. But then I looked it up and saw an explosive Atlantic magazine story, published last year, called, "E-mails Suggest Bear Stearns Cheated Clients Out Of Millions." And then I remembered that piece, and it hit me: Jeffrey Verschleiser is one of the biggest assholes in the entire world!
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SilverDoctors: Ron Paul Warns of IMF One World Currency to Replac...
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