Nov 20


Ukraine Debt Owed to Russia: Prime Minister Yatsenyuk: “We Will Not Pay the Aggressor State our $3 Billion Debt”:

Kiev will not pay Russia the $3 billion debt owed to it, unless other conditions of the restructuring are applied. This was stated by Arseniy Yatsenyuk. 

“I said to other lenders there are other conditions to be met or you will not receive the debt. The basic condition is reducing debt by 20%, the transfer of all debts of four years. If you do not like this, then you will receive the decision of the government of Ukraine via a moratorium on paying Russia the $3 billion. It is very easy to explain to our neighbours and the aggressor state: we will not pay $3 billion “,— quotes “RIA Novosti” citing the Prime Minister of Ukraine Continue reading »

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Nov 13

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Nov 10

For The First Time Ever, Corporate Bond Inventories Turn Negative – What This Means:

As we noted previously, for the first time ever, primary dealers’ corporate bond inventories have turned unprecedentedly negative. While in the short-term Goldman believes this inventory drawdown is probably a by-product of strong customer demand, they are far more cautious longer-term, warning that the “usual suspects” are not sufficient to account for the striking magnitude of inventory declines… and are increasingly of the view that “the tide is going out” on corporate bond market liquidity implying wider spreads and thus higher costs of funding to compensate for the reduction is risk-taking capacity.

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Nov 10


Why the U.S. Debt Ceiling is a Farce:

The U.S. government just increased its credit limit…

On Monday, President Obama signed a budget deal that raised the debt ceiling from $18.5 trillion to $20 trillion.

In theory, the debt ceiling limits how much money the U.S. government can borrow. The debt ceiling is now twice as high as it was when Obama took office in 2008. Continue reading »

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Nov 08

dave walker

“US Debt Is 3 Times More Than You Think” Former Chief US Accountant Warns, Americans “Have Lost Touch With Reality”:

In a shocking admission for most of mainstream America, the former U.S. comptroller general says the real U.S. debt is closer to about $65 trillion than the oft-cited figure of $18 trillion, thanks to unfunded liabilities which simply cannot be ignored. As The Hill reports, unless economic growth accelerates, he warns, “you’re not going to be able to provide the kind of social safety net that we need in this country,” adding unequivocially that Americans have “lost touch with reality” when it comes to spending.

As The Hill reports,

Dave Walker, who headed the Government Accountability Office (GAO) under Presidents Bill Clinton and George W. Bush, said when you add up all of the nation’s unfunded liabilities, the national debt is more than three times the number generally advertised. Continue reading »

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Nov 07

What Janet Knows:

What Janet knows, as The Burning Platform’s Jim Quinn exclaims, is that a 1% increase in interest rates would increase the interest on the National Debt from $400 billion per year to $600 billion per year, a 50% increase.


Source: Ben Garrison

Interest rates back at NORMAL historical rates that we had as recently as 2007 would increase the interest on the National Debt to $1 trillion per year, a 150% increase.

Plus, the National Debt increases by $1.5 billion per day, so our interest bill goes up by $35 million per day already.

Do you really think Yellen is going to be increasing interest rates?

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Nov 06


Former Reagan Administration Official Warns That Financial Disaster Is Dead Ahead:

Why won’t the American people listen to the warnings?  David Stockman was a member of the U.S. House of Representatives from 1977 to 1981, and he served as the Director of the Office of Management and Budget under President Ronald Reagan from 1981 to 1985.  These days, he is running a website called “Contra Corner” which I highly recommend that you check out.  Stockman believes that a global “debt super-cycle” that has been building for decades is now bursting, and he is convinced that the consequences for the U.S. and for the rest of the planet will be absolutely catastrophic.  His findings are very consistent with what I have been writing about on The Economic Collapse Blog, and if Stockman is correct the times ahead of us are going to be exceedingly painful. Continue reading »

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Nov 03

162 Days Later, The Treasury Finally Updates The Total US Debt Number, And It Is…:

8 months later, the US Treasury finally provided an update to the latest US debt number, and here it is: as of this moment, official US public debt is $18,492,091,120,833.99, or 102.5% of GDP.

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Oct 31

“The conditions in the economies of the rest of the world have undoubtedly proved weaker compared with a few months ago, in particular in the emerging economies. Global growth forecasts have been revised downwards. This slowdown is probably not temporary.”

Draghi Satan

Mario Draghi Admits Global QE Has Failed: “The Slowdown Is Probably Not Temporary”:

Undoubtedly, the most amusing this about the prospect of more easing from the ECB (as telegraphed by Mario Draghi last week) and the BoJ (where Haruhiko Kuroda just jeopardized his status as monetary madman par excellence by failing to expand stimulus) is that both Europe and Japan both recently slid back into deflation despite trillions in central bank asset purchases. 

In other words, the market expects both Draghi and Kuroda to double- and triple- down on policies that clearly aren’t working when it comes to altering inflation expectations and/or boosting aggregate demand. Indeed, both Goldman and BofAML said as much last week. For those who missed it, here’s Goldman’s take Continue reading »

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Oct 30

S&P Downgrades Saudi Arabia On Slumping Crude, Ballooning Fiscal Deficit:

“We expect the Kingdom of Saudi Arabia’s general government fiscal deficit will increase to 16% of GDP in 2015, from 1.5% in 2014, primarily reflecting the sharp drop in oil prices. Hydrocarbons account for about 80% of Saudi Arabia’s fiscal revenues.”

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Oct 28

And yes, this will end badly.


NIRP Panic: Over Half Of European 2-Year Bonds Trade At Record Negative Yields; Italy Paid To Issue Debt:

Europe has unleashed yet another monetary panic, and nowhere is it more visible than in what happened today across the short end of Europe’s government curve.  As the table below shows, more than half of European sovereign issuers just saw the yield on their 2 Year Notes trade not only below zero, but hit never before seen negative yields!

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Oct 23

Yes, the US government really is bankrupt. Here’s proof:

I’ve long-stated that the government of the United States is completely insolvent.

And that is 100% true statement.

The government’s own numbers show that official liabilities, including debt held by the public and federal retirement benefits, total $20.7 trillion. Continue reading »

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Oct 22


Presenting America’s New Debt Ceiling: $19,600,000,000,000:

Even as the bond market has been rather concerned about another possible debt ceiling showdown as we showed before, and which earlier today prompted the Treasury to announce the purposefully dramatic step of postponing the auction of 2 Year Notes next week, the reality is that one way or another, with an equity-driven wake up call for the GOP or without, the debt ceiling will be raised.

The only question is how much. Continue reading »

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Oct 22
T-12 days till US default…


Source: Ben Garrison

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Oct 22

WTF Chart Of The Day – Italian 2Y Bond Yields Collapse Below Zero For First Time Ever:

Presented with little comment aside to say… WTF!!!

Italy 2Y yields are -10bps to -0.6bps…


Some context for that… Continue reading »

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Oct 19

In Latest Humiliation For Illinois, Fitch Downgrades State’s Credit Rating To BBB+:

Last week, beleaguered Illinois Comptroller Leslie Geissler Munger admitted that, thanks to the bitter budget battle going on in Springfield, the state would miss a $560 million pension payment in November. Now, in a move that shouldn’t exactly surprise anyone, Fitch has cut the state’s GO rating citing the budget impasse. The move affects some $27 billion in debt.

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Oct 17

China Officially Sold A Quarter Trillion Treasurys In The Past Year (Unofficially Much More) And What This Means:

While to many Quantitative Tightening is a novel concept, the reality is that China (+ Euroclear) have been dumping Treasurys and liquidating reserves since January when total holdings peaked at $1.6 trillion last summer, and have since declined to $1.38 trillion. It means that China has sold a quarter trillion dollars worth of Treasurys in the past year, in the process offsetting what would have been about 25% of the Fed’s QE3.

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Oct 15

Fitch Downgrades Brazil From BBB To BBB-, Outlook Negative – Full Text:

Brazil’s economic recession is likely to be deeper and longer than Fitch’s earlier expectations and its performance has diverged materially from those of its rating peers. Medium-term prospects also look weak compared to peers and most other large emerging markets. Fitch forecasts that Brazil’s economy will contract by 3% and 1%, respectively in 2015 and 2016 before recording modest growth in 2017, with risks skewed largely to the downside.

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Oct 11

Fed Quietly Revises Total US Debt From 330% To 350% Of GDP, After “Discovering” Another $2.7 Trillion In Debt:

The Fed has managed to kill two birds with one stone: it no longer provides a simple, one-stop-shop way to reconcile the total US credit stock, and it quietly boosted total US consolidated credit by $2.7 trillion to $62.1 trillion as of June 30, 2015.


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Oct 07

The Source Of The US Economy’s Only Bright Spot: $1 Trillion In Car Loans:

As the following chart shows, after langushing between $70 and $800 billion in the second half of the last decade, since Q2 2010 US auto loans have been on an absolute tear, and have increased by over 40% in the past five years alone, to just shy of $1 trillion as of June 30!

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Oct 05

Treasury Sells 3-Month Bills At 0% Yield For First Time Ever:

“Investors” are so desperate to hold on to short-term paper that they paid $100 for a 3-month Treasury-bill at today’s auction. That is a 0% yield – for the first time ever – lower even than the auction right after Lehman’s bankruptcy in Nov 2008.

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Oct 02

macquarie teaser_0

Chinese Cash Flow Shocker: More Than Half Of Commodity Companies Can’t Pay The Interest On Their Debt

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Sep 24

Gen. David Petraeus in a photo with his biographer and mistress Paula Broadwell

David Petraeus, “Treasury Analyst”: Please Don’t Quit Your Day Job:

Moving on, but it only gets better because suddenly, out of the blue, a new Treasury bond market analyst emerges: none other than disgraced former CIA head David Petraeus, who somehow avoided treason charges when it was revealed that he had a mistress to whom he had leaked confidential material resulting in his prompt termination from the CIA, only to reemerge several years later…. as a Treasury market expert (as well as being recently hired by KKR, of course, just so the private equity company can scrub all of his formerly confidential knowledge before giving him the boot in the nearest future).

CNN introduces him as follows: “Petraeus is one of America’s brightest minds on matters of national security. He served as a top military commander in charge of troops in Iraq and Afghanistan before becoming director of the CIA in 2011.”

Leaving aside the laughable assertion of the first statement, after reading some of his comments we can only imagine he, as a member of the “intelligence community”, is a devoted subscriber of the abovementioned “Strategic Intelligence” newsletter.

Because here is the one statement from Petraeus that we read, read again, then kept rereading for one simple reason…

“There is no shortage of customers for the purchase of U.S. Treasuries,” said Petraeus…. “Given the relative strength of the U.S. economy and the prospect of the Fed raising interest rates at some point in the months ahead, I suspect there will continue to be very keen interest in U.S. Treasuries,” Petraeus said.

everything in it is dead wrong. Continue reading »

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Sep 23


“And just like that Weimar 2.0 is born.


“The Government Is Literally Paying Itself” – Citi Calls For Money Paradrops:

Last Friday, we posted what we thought was a watershed report by Australia’s largest investment bank Macquarie, one which openly called for central bank funding of fiscal spending, aka “helicopter money”, by directly monetizing treasuries. Ironically, the bank made the call despite admitting that it would not work in the long run, leading to even more stagflation and deflation. This was the gist:

As velocity of money globally continues to fall, conventional QEs have to become exponentially larger, as marginal benefit declines. If public sector is not prepared to step aside, what other measures can be introduced to support nominal GDP and avoid deflation? Continue reading »

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Sep 21

“Time’s Up” – Government Shutdown Odds Spike To 75%:

Two weeks ago, when no one was talking about the possibility of a government shutdown, we warned it was coming. Today, as Politico reports, with very little time left to reach a deal, budget experts project a 75% chance of a shutdown.

While a shutdown is anything but certain, of course. But it’s hard to see how the situation could change dramatically in the very short time left before the start of the fiscal year. It’s far more likely the odds will get worse rather than better. Politico’s Stan Collender’s most recent projection is that there is now a 75 percent chance of a shutdown. As he explains, Continue reading »

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Sep 19

Three Reasons Why The U.S. Government Should Default On Its Debt Today

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Sep 19

Moody’s Downgrades France, Blames “Political Constraints”, Sees No Material Reduction In Debt Burden

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Sep 16

China Liquidated A Record $83 Billion In Treasurys In July

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Sep 16


S&P Downgrades Japan From AA- To A+ On Doubts Abenomics Will Work – Full Text

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Sep 15

Nahhh … The Problem Is NOT ENOUGH Debt! </sarc>

Are We Heading Into a “Debt Supernova”?

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