By avoiding real economic reform, and by continuing with this credit creation to paper over all problems, Jerram said, China will likely face long-term economic stagnation, similar to what Japan experienced after its 1980s bubble. The Nikkei: Instead of pushing reforms to transform its economy to consumption-based growth, he [Jerram] expected that the nation would continue to rely on a government policy-supported growth model with credit continually expanding at “whatever number necessary to maintain the acceptable growth rate at 6-7%.”
Investors like Peter Schiff have been predicting the collapse of the American economy for a long time, and for good reason. If an economy is built on a foundation of borrowed money, then that economy is living on borrowed time. However, despite how fundamentally unsustainable our financial system is, it has somehow defied all expectations. It has gone on far longer than any of us could have imagined. But that could easily change under Trump. Schiff explains in a recent interview with Alex Jones and Dr. Jerome Corsi, that President Trump is the perfect scapegoat for the coming economic collapse. The establishment loathes him, and there’s plenty of evidence to suggest that they’re trying to pop the financial bubble that they created, while he is still in office.
If Gov. Bruce Rauner and his legislature in Springfield do not put a budget together by Friday, the Land of Lincoln will be the first state in the Union to see its debt plunge into junk-bond status. Illinois has $14.5 billion in overdue bills, $130 billion in unfunded pension obligations and no budget. “We can’t manage our money,” says Rauner. “We’re like a banana republic.”
Passive investing is taking a bigger share of the stock market, helping to drive gains.Exchange-traded funds, or ETFs, owned nearly 6 percent of the U.S. stock market as of the end of the first quarter, their greatest share on record, according to analysis by Goldman Sachs. Known as passive investments, ETFs are baskets of stocks tracking various market indexes and have grown in popularity for their relatively low fees. In contrast, mutual funds that involve higher-cost active stock picking have declined in popularity, and their ownership of the U.S. stock market has fallen to 24 percent, the lowest since 2004. ETFs purchased $98 billion worth of stocks in the first quarter, putting them on pace to buy $390 billion of stock this year, more than the last two years’ combined total of $362 billion, according to the Friday note by a group of analysts led by Goldman’s chief U.S. equity strategist, David Kostin. Goldman based its analysis on the Federal Reserve Board’s June 8 report on first-quarter U.S. financial accounts.
Concluding their Article IV consultations with the United States, the IMF now projects lower growth this year and especially next year. The previously forecast acceleration has now disappeared, and the growth trajectory for the US economy according to the IMF is far too consistent with previous years. “Reflation” is for them now gone just that quickly.
Centrally issued money optimizes inequality, monopoly, cronyism, stagnation and systemic instability. Everyone who wants to reduce wealth and income inequality with more regulations and taxes is missing the key dynamic: central banks’ monopoly on creating and issuing money widens wealth inequality, as those with access to newly issued money can always outbid the rest of us to buy the engines of wealth creation. History informs us that rising wealth and income inequality generate social disorder.
Germany sounded the alarm over Italy’s latest bank bailout, saying the apparent bending of European Union rules casts doubt on efforts to further integrate the euro zone. The government in Rome announced the country’s biggest bank rescue to date on Sunday evening as it committed as much as 17 billion euros ($19 billion) to clean up two failed banks. While the European Commission approved the plan, German officials pointed to the involvement of state aid to shield senior creditors from losses as working around EU law established to deal with bank failures.
The government has become an expert in finding ways to sidestep what it considers “inconvenient laws” aimed at ensuring accountability and thereby bringing about government transparency and protecting citizen privacy. Indeed, it has mastered the art of stealth maneuvers and end-runs around the Constitution. It knows all too well how to hide its nefarious, covert, clandestine activities behind the classified language of national security and terrorism. And when that doesn’t suffice, it obfuscates, complicates, stymies or just plain bamboozles the public into remaining in the dark.
If sales are down, then reducing inventory-to-sales ratios will require even less production. Durable goods reports do not show that happening yet……
you want a number, try 194. That’s how many countries there are on planet Earth (give or take one or two). Today, Nick Turse reports a related number that should boggle your mind: at least 137 of those countries, or 70% of them, already have something in common for 2017 and the year’s not even half over. They share the experience of having American Special Operations forces deployed to their territory. Assumedly, those numbers don’t include Russia, China, Iran, Andorra, or Monaco (unless guarding global casinos is a new national priority for our casino capitalist president). Still, they’re evidence of the great bet American casino militarism has made in these years – that elite special ops troops could do what the rest of the U.S. military couldn’t: actually achieve victory in a conflict or two.