This article appeared online at TheNewAmerican.com on Monday, March 14, 2016:
President Ronald Reagan’s former budget director David Stockman (middle, left) has been negative on the economy for months, noting in early February that
This article was published by The McAlvany Intelligence Advisor on Wednesday, March 9, 2016:
With crude oil up more than 30 percent over the last week, and companies like SeaDrill and Chesapeake Energy up 125 percent and 250 percent, respectively, over the last five days, short covering has persuaded some that the bottom is in. Investors, especially short sellers, in the oil patch need lots of risk capital, a high risk tolerance, and a short memory.
Goldman Sachs called it a
This article appeared online at TheNewAmerican.com on Monday, February 15, 2016:
Buried in Federal Reserve Chairman Janet Yellen’s comments to senators last Thursday were three revealing statements.
First: “There is always some chance of recession in any year. But the evidence [at the moment] suggests that expansions don’t die of old age.” Translation: Recessions result from inherent weaknesses in the system.
Second, she admitted that
This article appeared online at TheNewAmerican.com on Monday, September 28, 2015:
President Dilma Rousseff
Brazilians are facing a bleak future. The combination of last week’s downgrade of the country’s government debt to junk, along with downgrades on the debt of many of its major industries, and the unfolding “Operation Car Wash” scandal at Petrobras (the massive government-owned oil company), all spell trouble for an economy already in decline.
Brazil’s currency, the real, was once pegged to the dollar, but
This article was published by The McAlvany Intelligence Advisor on Monday, September 28, 2015:
Like flies attracted to honey, Brazilian politicians saw their opportunities and took them. Initially a money laundering investigation in Brazil focused on just one company, a manufacturer of electronic components that was being used by a criminal ring to hide and whitewash its illegal gains. The owner, Hermes Magnus, apparently discovered the activity back in 2008 and notified local police.
By March 2014 the investigation had spread to more than 230 individuals, including
This article was published by The McAlvany Intelligence Advisor on Monday, July 6, 2015:
Greek citizens shouted “No!” to further austerity measures for the hapless country in exchange for more of what got it into trouble in the first place: other people’s money. The lopsided 60-40 vote astonished telephone pollsters, who predicted a much narrower victory for Greek Prime Minister Alexis Tsipras of the far-left Syriza party. Although the issues were far more complicated than the referendum made it appear, the 68-word ballot question made it easy: do you want more increases in taxes, more cuts in pension benefits, another increase in the VAT … or not? Translated into English, the ballot read:
This article first appeared online at TheNewAmerican.com on Monday, June 22, 2015:
The announcement last week by Greece’s central bank that it may be forced to start implementing capital controls — eliminating the ability of Greeks who still have any money in the bank to withdraw it or send it to another country for safekeeping — may just be a ploy to bring more pressure on the Troika (European Central Bank, IMF, and eurozone countries) to release the last batch of funds from Bailout Number Three.
Withdrawals by nervous Greeks began last fall as Bailouts Number One, Two, and Three were only pushing the country further into recession. Withdrawal from the eurozone itself became increasingly likely, with the result that the euro would be replaced in Greece with a new currency with much less purchasing power.
Ever since Greece joined the European Community, later to be called the European Union, it has enjoyed far better credit ratings than it deserved. Assured that default was now no longer an option, central banks and other international financial institutions were more than willing to
This article was first published by The McAlvany Intelligence Advisor on Friday, May 8, 2015:
Wolf Richter is one observer of the present world economic scene who hasn’t had his mind altered by drinking the Kool-Aid ladled out in Washington and in the economics departments of so many colleges and universities. After holding a number of C-level positions (CEO, COO, etc.) in large and successful private companies, he chucked it and went to live for a while in Switzerland. He started a blog with the ghastly name of Testosterone Pit, which he thankfully changed to Wolf Street last summer.
He has been watching economic events unfold (and unravel) in China for some time, but the latest from the Shanghai Containerized Freight Index (SCFI) so startled him two weeks ago that he thought it was either a misprint, or that the index would bounce right back from its precipitous fall.
This article first appeared at The McAlvany Intelligence Advisor on Wednesday, January 14, 2015:
On Monday – the same day that UAE’s Energy Minister Suhall al-Mazrouel said that OPEC was going to stick to its decision to keep pumping regardless of price declines – the same day that Goldman Sachs issued its negative outlook for prices – when crude oil prices dropped in response by 5 percent, hitting a six-year-low of $44.20 a barrel on Tuesday, the CFO of Canadian Natural Resources announced he was going to expand both its production and its output into 2015 and beyond.
Chief Financial Officer Corey Bleber was oblivious to the carnage, saying that his company expected its overall output for 2015 to be at least seven percent ahead of last year’s, and that it would continue
This article first appeared at The McAlvany Intelligence Advisor on Wednesday, January 7, 2015:
Kingdom Centre, Riyadh, Saudi Arabia.
Most prognosticators are concentrating on their understanding of economics to inform their predictions on how much lower crude oil prices can go. It’s a simple matter of supply and demand: supply is increasing, demand is decreasing (and it’s inelastic, to boot), so when demand meets supply – and “clears the market” as economists call it – crude will find a bottom.
One analyst at CNN expects oil to drop into the $30s, declaring that
This article was first published at the McAlvany Intelligence Advisor on Wednesday, July 16, 2014:
Something remarkable is taking place in Washington this week. While the headline news is all about the border crisis, a little-known program designed to do an end run around the Second Amendment is being exposed to daylight. The House had two hearings on Tuesday – one by the Oversight and Investigations Subcommittee entitled “The Department of Justice’s ‘Operation Choke Point’” and the other by the House Committee on Financial Services to consider a bill to shut the whole thing down – and another one is scheduled for Thursday by the House Judiciary Committee entitled “Guilty until Proven Innocent? A Study of the Propriety and Legal Authority for the Justice Department’s Operation Choke Point.”
The pressure for such exposure has been building for months.
Subprime Crisis (Photo credit: woodleywonderworks)
Back in September, the Associated Press took a close look at U.S. census data and learned that the supposed economic recovery was leaving an awful lot of people behind. One segment is homeowners who bought the dream of owning a home using ARMs – adjustable rate mortgages – and who are now finding out how these sub-prime mortgages really work. They are working to
President Barack Obama confers with Federal Reserve Chairman Ben Bernanke following their meeting at the White House. (Photo credit: Wikipedia)
Followers of the Fed have carefully analyzed the 1,865 pages of transcripts it released in February of its eight regularly scheduled meetings and six emergency meetings in 2008 and have concluded that these experts were clueless and unaware of the opening economic abyss yawning before them. Even the New York Times was forced to admit, following its review of the documents, that
Titled “The Government Debt Iceberg”, the latest report from The Institute of Economic Affairs (IEA) in London was meant primarily for British eyes, but there’s enough in there to concern Americans worried about how
Now that credit rating agency Standard & Poor’s has ended the suspense by announcing that it is cutting Puerto Rico’s $70 billion worth of general obligation bonds to junk status, questions about the island’s economic future abound. Will Fitch and Moody’s follow suit
While Wall Street declined by 3 percent over global growth concerns last week, few were noting or even interested in the 11 percent decline in the Merval, Argentina’s stock market index. It hit a high of 5,970 on Tuesday, January 21, the day before the Argentina government devalued its currency, and closed at 5,337 on Monday. The peso itself has been in decline far longer, having lost nearly
Treasury Secretary Jacob Lew announced on Monday afternoon that his department had sold the remaining shares of GM that it acquired following the forced bankruptcy of the auto giant in 2009, and made the $10.5 billion loss sound like it was a victory:
This article was first published at The McAlvany Intelligence Advisor on Wednesday, October 30, 2013:
The complacency of municipal bond holders ended in July with the filing for bankruptcy by Detroit, an unhappy town of just 700,000 owing more than $18 billion to investors. Haircuts there have variously been estimated to be between 15 and 60 percent.
Since then, those holders have been looking around to find the next shoe to fall, and they have found it:
The announcement that a tentative agreement had been reached between the Department of Justice and JPMorgan (JPM) was surprising only in the size of the penalty the country’s largest bank (and second largest in the world) agreed to pay:
This article was first published at The McAlvany Intelligence Advisor on Monday, October 7, 2013:
The so-called “brinkmanship” press release by the Treasury Department reveals far more about the willingness of the media to report and repeat a canard that it does about the “crisis” facing the US if the government defaults.
Here are the title and just the opening paragraphs from the Treasury Department:
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