May 20

Russia to take legal moves if Ukraine defaults on $3bn debt – finance minister (RT, May 20, 2015):

Russia will appeal to the International Court of Justice if Ukrainian President Petro Poroshenko signs a moratorium on the payment of Ukraine’s external debt into law and fails to pay its debt to Russia, said Russian Finance Minister Anton Siluanov.

Siluanov said Ukraine was virtually defaulting on its debt, adding that Russia doesn’t yet have grounds to lodge any claims. If Kiev fails to pay $75 million in June, Moscow will use its right to appeal to the court, the Minister said. Continue reading »

Tags: , , , , ,

May 20

Junkie

Our “Junkie Economy” Will Soon Hit Rock Bottom (Bonner & Partners, May 19, 2015):

Addicted to Debt

Yesterday, U.S. stocks continued their climb, with a 26-point step-up to yet another all-time high for the Dow. Treasurys, meanwhile, continued to sell off. The yield on the 10-year T-note – which moves in the opposite direction to prices – rose 8 basis points to 2.2%. This follows last week’s turbulent action in the bond market, which saw Treasury yields hit a six-month high.

We have our eye on the U.S. bond market. Prices have been going up – and yields have been going down – for 32 years. And as prices have risen to the highest levels ever recorded, so has the amount of debt.

It is as though the world couldn’t get enough of the stuff. It got to be like heroin: The more debt the world took on, the more it wanted… and the bigger the dose it needed to get a buzz on. Continue reading »

Tags: , , , , ,

May 20

Greece-Euro

Greece Says That It Will Default On June 5th, And Moody’s Warns Of A ‘Deposit Freeze’ (Economic Collapse, May 20, 2015):

The Greek government says that a “moment of truth” is coming on June 5th.  Either their lenders agree to give them more money by that date, or Greece will default on a 300 million euro loan payment to the IMF.  Of course it won’t technically be a “default” according to IMF rules for another 30 days after that, but without a doubt news that Greece cannot pay will send shockwaves throughout the financial world.  At that point, those holding Greek bonds will start to panic as they realize that they might not get paid as well.  All over Europe, there are major banks that are holding large amounts of Greek debt and derivatives that are related to the performance of Greek debt.  If something is not done to avert disaster at the last moment, a default by Greece could be the spark that sets off a major European financial crisis this summer. Continue reading »

Tags: , , , , , , , , , ,

May 20

greece

Greece To Tax Bank Transactions, Says IMF “Won’t Get Any Money” On June 5 (ZeroHedge, May 20, 2015):

On Monday we got still more bad news for Greece. Around one-third of Angela Merkel’s Christian Democratic bloc opposes further aid for Athens meaning the Chancellor faces an uphill battle in convincing German lawmakers to keep Greece on life support. Meanwhile, a new report from the Hellenic Confederation of Commerce and Enterprises suggests that each day without a deal costs the Greek economy €22.3 million.

Not to put too fine a point on it, but Tuesday’s headlines are even worse.

First, up is parliamentary speaker Nikos Filis confirming what the IMF leaked on Saturday: without a deal, Greece will default on June 5.

Via Reuters:

Greece will not be able to make a payment to the International Monetary Fund that falls due on June 5 without a deal with its international lenders, the government’s parliamentary speaker said on Wednesday. Continue reading »

Tags: , , , , , , , , , ,

May 20

Wall Street’s Hot New Financial Product: Your Rent Check (Mother Jones, May 14, 2015):

Investment firms are playing landlord and bundling their rental homes into new securities. What could go wrong?

Toward the end of 2012, Mark Alston, a real estate broker in Los Angeles, began noticing something strange. Home prices were starting to rise, and fast—about 20 percent annually. Normally, higher home prices would signal increased demand from homebuyers and indicate that the economy was rebounding. But the home ownership rate was still dropping. Somehow, the real estate market was out of whack.

Then there were the buyers themselves. “I went two years without selling to a black family, and that wasn’t for lack of trying,” recalls Alston, whose business is concentrated in inner-city neighborhoods where the majority of residents are African American and Latino. Now all his buyers were businessmen in suits. And weirder yet, they were all paying in cash.

Over the lasttwo years, private equity firms and hedge funds have amassed an unprecedented real estate empire, snapping up Spanish revivals in Phoenix, adobes in Los Angeles, Queen Anne Victorians in Atlanta, and brick-faced bungalows in Chicago. In total, Wall Street investors have bought more than 200,000 cheap, mostly foreclosed houses in some of the cities hardest hit by the economic meltdown. But they’re not simply flipping these houses. Instead, they’ve started bundling some of them into a new kind of financial product that could blow up the housing market all over again. Continue reading »

Tags: , , , ,

May 19

rahm-emanuel

Why Chicago Bonds Are Junk, In 7 Charts (ZeroHedge, May 19, 2015)

Tags: , , , , , ,

May 18

Revealing The Identity Of The Mystery “Belgian” Buyer Of US Treasurys (ZeroHedge, May 18, 2015):

After months of speculation and confusion, on Friday we finally got if not direct, then certainly indirect, evidence from this month’s TIC data that “Belgium” was merely a front for China.

Tags: , , , , , , ,

May 18

The Debt To GDP Ratio For The Entire World 286 Percent

The Debt To GDP Ratio For The Entire World: 286 Percent (EconomicCollapse, May 17, 2015):

Did you know that there is more than $28,000 of debt for every man, woman and child on the entire planet?  And since close to 3 billion of those people survive on less than 2 dollars a day, your share of that debt is going to be much larger than that.  If we took everything that the global economy produced this year and everything that the global economy produced next year and used it to pay all of this debt, it still would not be enough.  According to a recent report put out by the McKinsey Global Institute entitled “Debt and (not much) deleveraging“, the total amount of debt on our planet has grown from 142 trillion dollars at the end of 2007 to 199 trillion dollars today.  This is the largest mountain of debt in the history of the world, and those numbers mean that we are in substantially worse condition than we were just prior to the last financial crisis. Continue reading »

Tags: , , , ,

May 17


16.05.2015

Description:

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the 26 most terrifying words in the English language. They also discuss vigilante governments and bond vigilantes. In the second half, Max interviews Harry Cole (Twitter: @MrHarryCole) about the Conservative party victory in General Election 2015. They also discuss Scotland, the EU referendum and the TTIP trade deal.

David-Cameron

Tags: , , , , , , , , , ,

May 16

parthenon

Greece Will Default On June 5 Without Deal, IMF Leaks (ZeroHedge, May 16, 2015):

Another week came and went with no breakthrough in negotiations between Greece and its creditors. The IMF is now fed up and has reportedly refused to be a part of any new bailout program for Greece, after Athens drew down its SDR reserves to makes its latest payment to the Fund. That money will now need to be repaid and in a move that surely marks the new gold standard for absurd circular funding schemes, Greece will likely look to use the next tranche of IMF money to payback its IMF SDR reserve which it tapped to pay the IMF. The country’s public sector employees live in limbo, not knowing from one week to the next whether they will be paid and commuters are now subjected to a 50 second looped highlight reel of the Nazi occupation meant to rally the country behind the government’s quarter trillion euro war reparations claim (they might as well just ask for a ‘gagillion’) on Germany which has now become the symbol of tyranny and debt servitude for many Greek citizens.  Continue reading »

Tags: , , , , , , , , ,

May 15

Credit Markets have Melted Overnight. Derivatives are a $1 Quadrillion “Ticking Time Bomb” (Global Research, May 13, 2015)

Tags: , , , ,

May 14

 –    China Goes “Unconventional” In Effort To Tackle Trillions In Debt, Rescue Economy (ZeroHedge, May 13, 2015):

China has officially entered the realm of “unconventional” monetary policy, joining the Fed, the ECB, the BoJ, and a whole host of other global central banks in an attempt to bring the supposedly all-mighty printing press and the unlimited balance sheet that goes with it to bear on subpar economic growth. We suspect the results will be characteristically underwhelming (at least in terms of lowering real interest rates, although in terms of boosting risk assets, the results may be outstanding) meaning it’s likely only a matter of time before LTRO becomes QE in China just as it did in Europe.

 

Tags: , , , , ,

May 12

“Greece tapped emergency reserves in its holding account at the IMF in order to make a 750 million euro payment to the Fund on Monday meaning that, as predicted, the IMF is now paying itself. Athens has one month to replenish the account. Meanwhile, the Fund has indicated it wants no part of another Greek bailout. And just to confirm how terminal the situation for Greece is, MarketNews just reported that Greece now has a paltry €90 million in cash reserves left. The end of the world’s most drawn out tragicomedy is finally nigh.”


Greece

–  Greece Effectively Defaults To IMF Using SDR Reserves To “Repay” Fund; 1 Month Countdown Begins (ZeroHedge, May 12, 2015):

When Monday’s Eurogroup meeting concluded without an agreement between Greece and its creditors, it should have been game over for Athens. With pensioners at their breaking point and with local governments reluctant to comply with a decree mandating a sweep of excess cash reserves, the idea that Greece would somehow be able to scrape together €750 million euros to make a scheduled payment to the IMF today seemed far-fetched at best which is why we asked the following question Monday afternoon:> Continue reading »

Tags: , , , , , , , ,

May 12

Japanese Govt Bonds Are Crashing After Weakest Auction Since Lehman (ZeroHedge, May 12, 2015)

Tags: , , , ,

May 12

Almost Half Of US States Are Officially Broke (ZeroHedge, May 12, 2015):

At least 22 states are facing budget shortfalls thanks to a combination of fiscal mismanagement and falling oil prices. The negative impact on the public sector has been dramatic suggesting that in the event of a sustained economic downturn, citizens’ patience for austerity could wear thin leading to political instability and social unrest.

Tags: , , , , ,

May 10

Schäuble Warns of “Sudden” Greek Default  (WolfStreet, May 9, 2015):

The governments of Greece – new and old – screwed up. Other debt-sinner countries are able to borrow at near-zero or negative interest rates, simply taking money from investors with a promise to return it on a given day in the future if investors give it new money to do so. These investors, it must be said, had their brains washed by the ECB and other central banks in order to allow this to happen. But the governments of Greece somehow missed that gravy train.

Now, no one wants to lend Greece money at negative interest rates, least of all the Greeks themselves, who know their governments better than anyone else on the planet and have less trust in it than anyone else on the planet: they’re yanking their euros out of their banks even as the ECB is propping them up with fresh euros that ultimately belong to taxpayers elsewhere. Continue reading »

Tags: , , , , , , ,

May 09

H/t reader M.G.:

screwed

Explaining the Greek Debt Crisis (The New York Times, April 8, 2015):

Greece, the weak link in the eurozone, is struggling to pay its debt as its people and its creditors grow more restive. The tumult poses a challenge to the euro and the Continent’s goal of economic unity. If Greece goes bankrupt or decides to leave the 19-nation eurozone, the situation could create instability in the region and reverberate around the globe.

What happened in Greece?

Greece became the epicenter of Europe’s debt crisis after Wall Street imploded in 2008. With global financial markets still reeling, Greece announced in October 2009 that it had been understating its deficit figures for years, raising alarms about the soundness of Greek finances. Continue reading »

Tags: , , , , , , , , ,

May 09

H/t reader M.G. (commenting on this article Japan National Debt Rises To ¥1,053,357,200,000,000):

“Thanks to Fukushima, Japan is finished, but nobody dares to say so. They always kept a strong fiscal house……but can no longer do so, and their national debt is growing to unsustainable levels.

The same story with most of the western world……debt, and more debt.

Now, Greece’s situation has moved out of control………nothing can save it, but the debt funded stock markets continue to climb…happy days are here again.

From the Guardian…….”


Tsipras sees ‘happy ending’ for Greece in crisis talks as €750m repayment nears (Guardian, May 8, 2015):

Greece’s embattled prime minister, Alexis Tsipras, has insisted he is confident of a resolution to the country’s debt crisis, as his government struggles to meet a €750m (£545m) repayment to the International Monetary Fund next week and avoid default.

Greece is starved of cash but senior EU officials say there is no prospect of a deal releasing bailout money when the eurozone meets on Monday in Brussels. Continue reading »

Tags: , , , , , , , , ,

May 08

Bank of Japan - When Money Dies

Japan National Debt Rises To ¥1,053,357,200,000,000 (ZeroHedge, May 8, 2015):

What’s the point of even commenting on this unambiguous Keynesian nirvana?

Japanese Total Debt

Tags: , , ,

May 07

98% Of Q1 Consumer Credit Was Used For Student And Car Loans (ZeroHedge, May 7, 2015):

In a quarter in which US GDP is set to decline consumer credit, according to the latest update from the Federal Reserve, increased by just over $45 billion. But how is it possible that with such a massive expansion in household credit there was no actual benefit to the underlying economy? Simple: 98% of the credit lent out in the first quarter, or $44.3 billion, went to student and car loans!

Tags: , , , ,