IMF Confirms Global #Economy Crashing

IMF Says World is at Risk of 'Economic Derailment'

The International Monetary Fund (IMF) has warned that the global economy faces a growing "risk of economic derailment" and must take steps to boost global demand.

David Lipton, second in command at the IMF, outlined some of these risks in a speech to the National Association for Business Economics in Washington on Tuesday.

"The IMF's latest reading of the global economy shows once again a weakening baseline," he said. "We are clearly at a delicate juncture." 

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http://www.bbc.com/news/business-35761017

Oregon To Be First U.S. State To Ban Coal-Fired Power  

Coal provides about a third of Oregon's electricity, but most of it is imported from Utah, Montana and Wyoming. The state only has one operating coal-fired power plant, the 36-year-old Boardman facility supplying about 550 megawatts, but it is due to shut down by 2020.

State Republicans criticized the bill as leading to higher electricity costs for households but Pacific Power, a large Oregon utility, answered that the move to renewables would only raise costs by less than 1 percent by 2030, the newspaper said. The other major utility in the state, Portland General Electric, also backed the deal.

The Seeds of Destruction  

Economists (like me) take a wider perspective. We tend to focus on markets as aggregates rather than on individual firms. We also see government as an economic actor in its own right, providing public goods and other essentials that markets don’t because of externalities and market failure. We know the “logic” of government leads it to overreach, but most of us don’t imagine that we can live without it

How oil price volatility explains these uncertain times  

Recently it occurred to me that the wave pool provides a metaphor for a complex, but disquieting phenomena that I've have been writing about at Oil-price.net for some time now -for previous articles see 2010, 2011, 2013 and 2015.

For anyone who has read one of these pieces you'll know how I have described that every three to four years volatility in the price of oil surges upwards as if spurred by an unseen wave machine.

China's Export Slump Shows Growth Push Hinges on Local Demand

China’s export slump deepened in February, highlighting the challenge for policy makers seeking to keep the economy humming at home while trade acts as a brake on growth.

The week-long Chinese new year holidays fell in February this year, closing factories and curbing shipments. That saw exports tumble 25.4 percent in U.S. dollar terms from a year earlier, the biggest decline since May 2009. Imports extended a streak of declines to 16 months, slumping 13.8 percent, leaving a trade surplus of $32.6 billion. 

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http://www.bloomberg.com/news/articles/2016-03-08/china-export-slump-shows-growth-push-depends-on-domestic-demand

www.firstfinancialinsights.blogspot.com

Europe Entering Long Economic Dark Age, & More

The Economic And Financial Problems In Europe Are Only Just Beginning…

Right now, the financial world is focused on the breathtaking stock market crash in China, but don’t forget to keep an eye on what is happening in Europe.  Collectively, the European Union has a larger population 

than the United States, a larger economy than either the U.S. or China, and the banking system in Europe is the biggest on the planet by far.  So what happens in Europe really matters, and at this point the European economy is absolutely primed for a meltdown.  European debt levels have never been higher, European banks are absolutely loaded with non-performing loans and high-risk derivatives, and the unemployment rate in the eurozone is currently more than double the unemployment rate in the United States.  In all the euphoria surrounding the “deal” that temporarily kept Greece in the eurozone, I think that people have forgotten that the economic and financial fundamentals in Europe have continued to deteriorate.  Whether Greece ultimately leaves the eurozone or not, a great financial crisis is inevitably coming to Europe.  It is just a matter of time.

In many ways, the economy of Europe is in significantly worse shape than the U.S. economy.  Just recently, the IMF issued a report which warned that the eurozone is “susceptible to negative shocks” and could be facing very tough economic times in the near future. 

Supply and Demand in the Gold and Silver Futures Markets

The bear market in bullion is an artificial creation.

India set to overtake China as world's most populous country by 2022

Populations in many regions are still young. In Africa, children under 15 account for two fifths of the population.

Debt Slaves: 7 Out Of 10 Americans Believe That Debt ‘Is A Necessity In Their Lives’

debt is considered to be just part of normal life.  We go into debt to go to college, we go into debt to buy a vehicle, we go into debt to buy a home, and we are constantly using our credit cards to buy the things that we think we need. 

Exxon Earnings: Carnage 

Moments ago energy titan Exxon Mobile, which not too long ago was bigger than AAPL by market cap, and is now roughly half the size of the phone maker, reported earnings which were, in a word, carnage. Starting at the bottom, EPS of $1.00 was not only a big miss to already reduced expectations of $1.11, but also the worst quarter since 2009.

Home Capital scandal may presage a slowdown: Don Pittis 

On a conference call yesterday Home Capital CEO Gerald Soloway insisted that the problem with its brokers was not an indication of a mortgage fraud crisis across Canada. Home Capital's delinquencies remain low, and the company says it has stopped doing business with the brokers that investigators had shown to be pretending customers' income qualified them for mortgages.

The War On Cash & Your Freedom – Mike Maloney 

“It’s the first step in the government being able to just turn you off if they don’t like you for some reason.”

“If we go 100% electronic, the banks can decide to charge you whatever you want in each transaction, the government gets to tax every transaction immediately.”

The Investment Legends Are Warning of a Systemic Event 

Seth Klarman used to manage the fourth largest hedge fund in the US. A legendary value investor (copies of his book Margin of Safety sells for over $1,500 on Amazon), Klarman returned billions in assets under management to outside investors citing “too few” opportunities in the market (again, a legend stating that the market was overvalued).

Warren Buffett, perhaps the single biggest cheerleader for stocks in the last 100 years, is sitting on a record amount of cash. The reason is obvious: the market is dangerously overpriced.

Learning Success: 

APPLY Tips From The Best

Warren Buffett, Berkshire Hathaway – He is a deeply conservative trader during the times that everyone around him is moving from one extreme to the other to the tune of huge losses and gains. Warren Buffett is a perfect example of patience, proving that slow and steady generally wins the business race. (Although I continue to press my own desire to spur Fishbowl’s inventory software business to race!)

Top Weekly Ideas and Insights

An Inconvenient Truth:

What Happens When Top Economists Realize Physical Growth Constraints?

 EXISTENTIAL REALITY 

"Humanity's Coming of Age"

 - The Last Days of Economic Growth -

Nine Reasons Why Low Oil Prices Will Create Economic Mayhem, & More

Nine Reasons Why Low Oil Prices May “Morph” Into Something Much Worse

9. It is doubtful that the prices of energy products and metals can be raised again without causing recession.

We are not talking about simply raising oil prices. If the economy is to grow again, demand for all commodities needs to rise to the point where it makes sense to extract more of them. We use both energy products and metals in making all kinds of goods and services. If the price of these products rises, the cost of making virtually any kind of goods or services rises.

Raising the cost of energy products and metals leads to the problem represented by Growing Inefficiency (Figure 4). As we saw in Point 5, wages tend to go down, rather than up, when other costs of production rise because manufacturers try to find ways to hold total costs down.

Lower wages and higher prices are a huge problem. This is why we are headed back into recession if prices rise enough to enable rising long-term production of commodities, including oil.

IMF warns of gloomy eurozone outlook

Reforms and action needed urgently as fears over Greece, high unemployment, structural flaws and a still-shaken bank sector slow growth

The International Monetary Fund has warned the eurozone faces a gloomy economic outlook thanks to lingering worries over Greece, high unemployment and a banking sector still battling to shake off the financial crisis.

The IMF’s latest healthcheck on the eurozone found it was “susceptible to negative shocks” as growth continues to falter and monetary policymakers run out of ways to help. It called for an urgent “collective push” from the currency union to speed up reforms or else risk years of lost growth.

“A moderate shock to confidence – whether from lower expected future growth or heightened geopolitical tensions – could tip the bloc into prolonged stagnation,” said Mahmood Pradhan, the IMF’s mission chief for the eurozone.

Greece rocked by reports of secret plan to raid banks for drachma return

Opposition demands answers after covert proposals attributed to Yanis Varoufakis and fellow ex-minister highlight deep split in Syriza party

Some members of Greece’s leftist-led government wanted to raid central bank reserves and hack taxpayer accounts to prepare a return to the drachma, according to reports that highlighted the chaos in the ruling Syriza party.

It is not clear how seriously the government considered the plans, attributed to former energy minister Panagiotis Lafazanis and ex-finance minister Yanis Varoufakis. Lafazanis was sacked from his post and Varoufakis resigned earlier this month. However, the revelations have been seized on by opposition parties who are demanding an explanation.

 The Donald and the Delusional

But the Republican base isn’t eager to hear from SHCs; it has never put McCain on a pedestal; and people who like Donald Trump are not exactly likely to be scared off by his lack of decorum.

For what it’s worth, I still don’t expect The Donald to win the nomination; the big money will presumably coalesce around someone — though given Jeb’s foot-in-mouth performance it’s hard to see who — and will probably squeeze him out in the end. But the story so far has been a remarkable illustration of how little many professional political pundits seem to understand.

BRIEF-Philips CEO says China is really slowing down, as is Brazil

Raoul Pal: GroupThink Is Almost Ubiquitous (& The 1 Chart That Matters) )

My overarching belief is that this is the most “pure macro” environment we have been in for over a decade, probably since the Asian Crisis in the late 1990s, and I just don’t think people understand what is going on.

My entire thesis rests neatly on the US Dollar. Nothing else matters and if my view is wrong on that, then it is likely wrong on many things. What is really weird to me is that most people agree with my views on the dollar but don’t have the trade on, and were less versed on the macro knock-on effects of a strong dollar. Groupthink has tended to isolate particular parts of the US or global economy and ignore the bigger picture.

Memorize This, Earn A Dollar 

Importantly, actual breakdowns in market internals have been followed by market losses, on average, even since 2009 (as we saw in the near-20% plunge of 2011). In mid-2014, we imposed the requirement that market internals or credit spreads must actually deteriorate as a precondition to establishing a hard-defensive market outlook. That adaptation brings our present methods back in line with the central considerations that were responsible for our success prior to 2009.

Learn Success: APPLY Tips From The Best

Jeff Bezos, Amazon– Jeff Bezos is a pioneer in world of internet commerce, and was instrumental in defining this space that is now defining many aspects of the internet world. It is Jeff Bezos who innovated the concept of “predictive analytics”–recommending products to customers based on search history and buying habits. Whether you like the concept or you hate it, the idea has made online commerce more profit rich and efficient, and is making online shopping a better experience for consumers throughout the world.

Top Weekly Ideas and Insights

An Inconvenient Truth:

What Happens When Science Confronts Unsubstantiated Fiction?

 EXISTENTIAL REALITY 

"Humanity Coming of Secular Age"

 - The Last Days of Theism -