Jan 31

You can’t make this stuff up!


mortgage

- In Denmark You Are Now Paid To Take Out A Mortgage (ZeroHedge, Jan 30, 2015):

With NIRP raging in the Eurozone and over €1.5 trillion in European government bonds trading with negative yields, many were wondering when any of this perverted bond generosity will spill over to other debtors, not just Europe’s insolvent governments (who can only print negative interest debt because of the ECB’s backstop that it will buy any piece of garbage for sale in the doomed monetary union). In fact just earlier today we, rhetorically, asked a logical – in as much as nothing is logical in the new normal – question:

Little did we know that just minutes after our tweet, we would learn that at least one place is already paying homeowners to take out a mortgage. That’s right – the negative rate mortgage is now a reality.

Thanks of Mario Draghi’s generosity with “other generations’ slavery”, and following 3 consecutive rate cuts by the Danish Central Bank, a local bank – Nordea Credit – is now offering a mortgage with a negative interest rate! This means, according to DR.dk, that Nordea have had to pay instead of charging interest to to a handful of customers, says housing economist at Nordea Kredit, Lise Nytoft Bergmann for Finance. Continue reading »

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Jan 30

- Greek Bond Yields Surge Above 19% After EU Talks (ZeroHedge, Jan 30, 2015):

Following finance minister Varoufakis’ insistence that Greece will not accept more debt (or what EU calls a “bailout”) and talks with the Eurogroup chief end, Greek bond yields have surged (and prices dropped) with 3Y GGBs back over 19% – the highest since the crisis. Greek bank stocks – after yesterday’s exuberant penny stock squeeze – are falling once again.

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Jan 27

- 7 Quick Points on Europe (Salient Partners, Jan 26, 2015):

#1) Here are the most relevant recent notes for an Epsilon Theory perspective on the underlying political and market risks in Europe: “The Red King” (July 14, 2014) and “Now There’s Something You Don’t See Every Day, Chauncey” (Dec. 16, 2014).

#2) Markets reacted positively to last Thursday’s announcement because Draghi doubled the amount of QE that he leaked to the press on Wednesday. Financial media pegged QE at 600 billion euros on Wednesday and 1.2 trillion euros on Thursday. Once again, Draghi played the Narrative game like a maestro. Continue reading »

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Jan 26

- Russia Slams S&P Downgrade For “Excessive Pessimism” (ZeroHedge, Jan 26, 2015):

 Well that didn’t take long. Russian Finance Minister Siluanov has responded to S&P’s “junk” downgrade of The Russian Federation:
  • *SILUANOV: S&P DOWNGRADE OF RUSSIA SHOWS ‘EXCESSIVE PESSIMISM’
  • *SILUANOV: NO REASON TO EXPECT `MASS’ DEBT REDEMPTION REQUESTS

Adding in his statement that he “sees no reason to dramatize” the situation, Siluanov adds that the cut should not have any serious effect on Russia’s capital markets. We assume by “dramatize,” he means – they wil not be ‘visiting’ the local ratings agencies offices for a chat anytime soon.

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Jan 26

H/t reader squodgy:

“If a an IMF/Fed puppet ratings agency classes one as junk….it must be good news.”

Related info:

- Downgrading The US Credit Rating Will Cost S&P $1.5 Billion

- ‘De-Dollarization’ Deepens: Russia Buys Most Gold In Six Months, Continues Selling US Treasuries


- S&P downgrades Russia’s sovereign credit rating to below investment grade (CNBC, Jan 26, 2015):

Standard & Poor’s on Monday downgraded Russia’s sovereign credit rating to below investment grade, as the country’s economy continues to weaken.

S&P slashed Russia’s sovereign credit rating to BB+ from BBB- and said the outlook is negative, reflecting its view that Russia’s monetary policy flexibility could diminish further.

This is the first time in more than 10 years that Russian sovereign debt has been rated below investment grade, in what some call “junk” territory. Continue reading »

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Jan 25

Bazooka man Draghi, taking aim at the euro

- Bouncing Rubble (Alhambra Investment Partners, Jan 23, 2015):

The Keynesian revival that is currently underway in the backrooms and hallways of assorted world governments is being somewhat replicated in Europe this week. It is all predicated on the position that all previous forms of “stimulus” from the fiscal side were not the right size, composition or color for that matter and thus the lack of recovery can be attributed to the impurity of the Keynesian solutions. That is further augmented in especially the Krugman view of “austerity” which has supposedly undercut all the good deeds done by central banks.

Thursday’s press conference with Mario Draghi announcing the QE program ran dangerously into interfering with that Krugman view, while also keeping within the spirit of the “purity” argument. Toward the end of the question and answer session, the ECB’s chief was asked about hyperinflation, as if this latest balance sheet expansion might nudge Europe closer to Weimar. Continue reading »

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Jan 20

bubble burst_0

- The Beginning of the End of the $100 TRILLION Bond Bubble (ZeroHedge, Jan 19, 2015):

The big story in the world is the bond bubble.

For over 30 years, sovereign nations, particularly in the West have been buying votes by offering social payments in the form of welfare, Medicare, social security, and the like.

The ridiculousness of this should not be lost on anyone. Politicians, in order to be elected, promise to allocate taxpayer funds on social programs that will benefit said taxpayers down the road (we’re simply talking about social spending, not infrastructure or other costs.

The concept that taxpayers might simply just keep the money to begin with never enters the equation. And because everyone believes that they are somehow spending someone else’s money, they play along.

When you believe that you are spending someone else’s money, it’s very easy to write a blank check, which is precisely what Western nations have been doing for years, promising everyone a safe and secure retirement without ever bothering to see where the money would come from. Continue reading »

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Jan 19

Putin-Gold

“De-Dollarization” Deepens: Russia Buys Most Gold In Six Months, Continues Selling US Treasuries (ZeroHedge, Jan 18, 2015):

The rumors of Russia selling its gold reserves, it is now clear, were greatly exaggerated as not only did Putin not sell, Russian gold reserves rose by their largest amount in six months in December to just over $46 billion (near the highest since April 2013). It appears all the “Russia is selling” chatter did was lower prices enabling them to gather non-fiat physical assets at a lower cost. On the other hand, there is another trend that continues for the Russians – that of reducing their exposure to US Treasury debt. For the 20th month in a row, Russia’s holdings of US Treasury debt fell year-over-year – selling into the strength.  

Buying low…

Russia gold reserves jump the most in six months in December, near the highest since April 2013…

Russia-Gold-Reserves

and selling high…

Russian holdings of US Treasuries are now at the 2nd lowest since 2008… Continue reading »

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Jan 18

From the article:

“And we are also finally glad that with every passing day more and more banks, pundits and “straight to CNBC” experts wearing business suits realize what we said 6 years ago, namely that QE will never work as one can’t fix a failed financial system due to record debt problem with more debt and even more props to support an even more failed financial system. And that QE has, is, and will continue failing… for everyone but the 1% of course, who with every passing day continue to tempt not only fate but the guillotines as well. Reference? See the French Revolution, because it is never different this time.”


Mario-Draghi-Just-Evil

- The ECB Will Fail Given The “History Lessons Of US And Japan”, Warns Deutsche Bank (ZeroHedge, Jan 18, 2015):

Recall that the stated purpose behind the reason why Mario Draghi’s ECB is about to launch a European government debt monetization program ranging between EUR500 and 1000 billion is to halt deflation, spark credit creation and rekindle inflation. Alas, if that is indeed the case, then as Deutsche Bank said has already determined apriori, it will be a failure. Here’s why from the biggest German bank.

First, a broad strokes preview of what the world’s most confused Central bank will do this week: Continue reading »

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Jan 18

- The SNB’s Wake-Up Call: Keynesian Central Banking Is Destroying Money And Markets (David Stockman’s Contra Corner, Jan 17, 2015):

It seems everyone was short the franc (CHF) as a matter of taking monetarism at face value. In other words, it amounted to believing the central party line about the economy and normalcy despite the fact that markets have been increasingly pessimistic about it all and actively and aggressively betting against it. Goldman Sachs is just one of many: Continue reading »

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Jan 10

Vladimir-Putin-smile-sunglasses

- Thank You Western Taxpayer: Russia To Accelerate $3bn Of Ukraine Debt (ZeroHedge, Jan 10, 2015):

Just 13 short months ago – two months before then President Yanukovich was ousted – Russia lent Ukraine $3 billion (by buying their Eurobonds). As Reuters reports, the terms of that loan included a condition that Ukraine’s total state debt should not exceed 60% of its GDP. As of last month, based on Moody’s estimates, Ukraine has violated that condition with a debt-to-GDP of 72% (and will likely rise to 85% of GDP in 2015).. and so, according to Russian finance minister Anton Siluanov, “Russia has the right to demand early return of this loan.” With European aid ‘contingent on major reforms’ and possibly taking up to 1 year, this leaves the good old IMF (i.e. the US and European taxpayer) to bridge Ukraine’s ‘gap’ and ironically bailout Russia.

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Jan 10

Fitch

- Fitch has downgrades Russia’s rating from BBB to BBB-, negative outlook (Itar Tass, Jan 10, 2015):

LONDON, January 10. /TASS/. The international rating agency Fitch said on Friday it had downgraded Russia’s long-term rating from BBB to BBB-, negative outlook.

“Fitch Ratings has downgraded Russia’s Long-term foreign and local currency Issuer Default Ratings (IDR) to ‘BBB-‘ from ‘BBB’. The issue ratings on Russia’s senior unsecured foreign and local currency bonds have also been downgraded to ‘BBB-‘ from ‘BBB’. The Outlooks on the Long-term IDRs are Negative. The Country Ceiling has been lowered to ‘BBB-‘from ‘BBB’. The Short-term foreign currency IDR has been affirmed at ‘F3′,” Fitch said in a statement.

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Jan 09

- Russian Debt Safer Than U.S.? So Says China Rating House Dagong (Bloomberg, Jan 8, 2015):

A currency crisis, recession and plunge in the price of its key export don’t mean Russia is any less creditworthy than the U.S., according to one of China’s biggest debt-rating companies.

Just the opposite — it’s a better credit risk, says Dagong Global Credit Rating Co. The firm, which downgraded U.S. government debt in October 2013 to A-, today said it has decided to maintain Russia’s rating at A with a stable outlook. Continue reading »

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Jan 03

- 5Y German Bond Yield Goes Negative For First Time Ever (ZeroHedge, Jan 2, 2015):

How do you say Japanization in German? 5Y German bonds just traded at -0.1bp yield (below Japan’s 3bp 5Y yield)…

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Jan 03

2015 Will Be All About Iran, China and Russia

- 2015 Will Be All About Iran, China and Russia (Sputnik International, Dec 31, 2014):

By Pepe Escobar

Fasten your seatbelts; 2015 will be a whirlwind pitting China, Russia and Iran against what I have described as the Empire of Chaos.

So yes – it will be all about further moves towards the integration of Eurasia as the US is progressively squeezed out of Eurasia. We will see a complex geostrategic interplay progressively undermining the hegemony of the US dollar as a reserve currency and, most of all, the petrodollar. Continue reading »

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Jan 02

Related info:

Total US Debt Rises Over $18 Trillion; Up 70% Under Barack Obama (ZeroHedge):


total debt teaser

- US Debt Soars By $100 Billion On Last Day Of 2014, Hits Record $18.14 Trillion (ZeroHedge, Jan 2,  2014):

It seems like it was only yesterday when we reported that, in yet another sleight of hand for the US Treasury and Social Security Administration, US debt rose by $32 billion on the last day of November sending total US debt above $18 trillion for the first time ever.  As we further noted, it also meant “that total US debt has increased by 70% under Obama, from $10.625 trillion on January 21, 2009 to $18.005 trillion most recently.”

Fast forward to today when we are happy to report that according to the US Treasury, America’s debt-funded spending spree, while supposedly slowing down if looking at the declining monthly budget deficit report, never actually has.

As of the last day of 2014, total US debt soared by $98 billion in one day (driven again by Social Security debt surging on the last day of the month to a record $5.117 trillion), and closing off 2014 with a new all time high total of $18.141 trillion in Federal debt – an increase of $136 billion in the month of December and $790 billion for all of 2014.

US debt dec 31 2014

Source: US Treasury Continue reading »

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Jan 01

crash-dollar

- Jim Willie: DOLLAR DEATH: Global Trade Using Dollars Down 50%! (Grams Gold, Dec 26, 2014):

This transcript of the interview with Jim Willie in early December 2014 highlights the importance of gold on the world stage, as well as other important events that are taking place.In the video interview titled, “No Prisoners in the Global Money War,” Willie says, “I think we have acceleration on the systemic breakdown globally. There is no asset foundation to the US banking system anymore. It’s just a bunch of ‘spinning derivatives on computer trades’. Continue reading »

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Dec 29

- Brazil’s Economy Just Imploded (ZeroHedge, Dec 29, 2014):

China may have mastered the art of fabricating economic data to a level unmatched by anyone except the US Department of Labor, but its derivative countries have much to learn. And none other more so than one of China’s favorite sources of commodities over the past decade: Brazil. It is here that things are going from worse to catastrophic, as disclosed in today’s update of Brazil’s fiscal picture.

Here are the disturbing facts showing that behind the world’s propaganda growth facade, it is all hollow: Brazil’s consolidated public sector primary fiscal balance, which posted a significantly worse than expected R$8.1bn primary deficit in November driven by the R$6.7bn deficit of the Central Government, dipped into negative territory: -0.18% of GDP, driven by the significant deterioration of the Central Government finances.

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Dec 25

US-Obama-Santa-Claus Continue reading »

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Dec 23

Stocks Surge To Record-est Highs, Bond Bloodbath Ensues

Dow Over 18,000: Stocks Surge To Record-est Highs, Bond Bloodbath Ensues (ZeroHedge, Dec 23, 2014)

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