Top British Banker Dooms #EUROZONE

Whatever boneheads thought that supra-constitutions were better  for economic stability or governing anything had more than a few loose marbles. Basically, such stupidity undermines both free enterprise and democracy , thereby destroying the fabric, inspiration and motivation of a society while concurrently leading to oppressive states that garner Soviet-style sluggishness and inefficiencies.

 Now, if you recall the Soviet system fell apart just for the reasons mentioned above  - meaning that it was a perfect time for the  Eurozone to copy their failed ideology ( so who needs a book to figure out common sense issues?  - More dumb!) 

Repeat after FFI folks, "Tear Down Those Walls Mr Gorbachev"  

Mervyn King: The  Eurozone is Doomed

The eurozone is doomed to fail and will lurch from crisis to crisis unless it is broken up, according to the former governor of the Bank of England.

In his new book, Lord King claims that steps towards fiscal union will not quell tensions in the 19-nation bloc and could even tear it apart. 

He warns of a looming “economic [and] political crisis” triggered by endless bail-outs, austerity demands and pressure from the “elites in Europe” and the US to create “a transfer union” to solve the eurozone’s woes. 

READ MORE

http://www.telegraph.co.uk/business/2016/02/28/mervyn-king-the-eurozone-is-doomed/

China central bank cuts reserve requirement ratio by 0.5 percentage points 

China's central bank, the People's Bank of China, has cut further the reserve requirement ratio, the amount of cash the country's banks have to hold, in an attempt to calm investor jitters over the world's second largest economy. The PBOC cut the ratio ...

http://www.cnbc.com/2016/02/29/china-central-bank-cuts-reserve-requirement-ratio-by-05-percentage-points.html

China expects to lay off 1.8 million workers in coal, steel sectors 

The central government will allocate 100 billion yuan ($15.27 billion) over ... There are many issues to be dealt with, including how to pay debt as well as layoffs.

http://www.reuters.com/article/us-china-economy-employment-idUSKCN0W205X

Financial Precipice à la 1929?  

There is a huge laundry list of leading economic indicators I could point you to for visualizing the sick economy, but perhaps the king of all leading indicators is the price of oil. It has absolutely cratered in the past year and a half. It’s gone from well over $100 per barrel to now hovering around $30 and flirting with the idea of going lower, a 70%+ decline. Now why would oil drop in price so dramatically? 

Is it because the Saudi’s are trying to drive the American shale industry out of business? No, it’s much simpler than that. People simply don’t need as much oil because they aren’t producing enough goods because there aren’t enough people willing to buy those goods. When demand dries up, sellers are forced to lower prices to entice buyers to keep buying.

https://clanagainstthegrain.wordpress.com/2016/02/15/financial-precipice-a-la-1929/

China Devalues Yuan as Stocks Crash

 

With China devaluing its currency, stocks crashing 3 percent and capital flight accelerating, China has cut back its bank reserve requirements to free up $100 billion in credit.

Facing pressure from huge capital flight, the Chinese allowed their yuan currency todevalue to 6.6 yuan to the dollar on Feb. 29, causing local stock markets to crash by 3 to 5 percent — to levels not seen since late 2014.

To try to stop the rout, China’s central bank cut its deposit reserve requirement ratio by 50 basis points, to 17 percent, in an effort to free up about $100 billion in new credit for the world’s second-largest economy. The cut marks the fifth time in the last 12 months, but the first time since October 23, that China has had to reduce bank solvency to deal with financial panic, according to Stratfor Global Intelligence.

READ MORE

http://www.breitbart.com/national-security/2016/02/29/china-devalues-currency-as-stocks-crash/

www.firstfinancialinsights.blogspot.com

Street Talk: Global Bond Plunge Could Trigger 50%+ Stock Slump

Opinion: Get ready for a 4,000-point Dow drop

The stock market has an empirical rule: interest rates lead stocks. And the current interest rate environment is pointing to a massive decline for the U.S. market.

Consider: The Federal Reserve has taken rates to the lowest level in more than a generation. This has energized stock prices. The Fed has persisted in its directive to “stay the course,” having made no raises in the discount rate for more than seven years. Such monetary policy has no precedent; this is the longest stretch of accommodation by the Fed in the post-World War II era.

But there’s Fed-induced rates, and “actual” rates. The most widely followed Treasury markets are the longer-term 10-year TMUBMUSD10Y, -1.54%  and 30-year TMUBMUSD30Y, -1.00%  markets. These two markets are highly sensitive to longer-term actual interest-rate pressures. For example, banks use longer-term Treasurys to make decisions on pegging personal loan rates to clients for mortgages, businesses, and other uses. The commercial and industrial areas of the economy also are susceptible to the actual cost of money.

Read More.

Never Forget

Chinese Imports Plunge 17.6% Signaling Huge economic Slowdown

Chinese Trade Balance: Imports Collapse, More Easing ahead?

The Chinese equity markets were in a strong uptrend in the trading session today on the back of tepid trade balance reports which had investors and analysts believe that the Chinese government could introduce further easing into the system to kick start growth in the economy.

 It was reported today that exports from the Chinese economy fell less than expected but a double digit decline in imports is being seen as a huge negative by traders and investors as it is indicative of the sluggish consumption present in the economy at the current moment. Exports fell by close to 2.5 percent but imports declined by 17.6 percent as compared to the same period last year.

Read More.

NEW Shanghai Tower Means End Nearing

Why this 2,073-foot Chinese building could be an omen of economic doom

Nothing suggests the height of human achievement and economic prowess quite like a skyscraper.

The newly completed 2,073-foot-tall Shanghai Tower is officially the second-tallest building in the world (behind Dubai's Burj Khalifa) and the tallest in China.

And taller skyscrapers are planned, such as China's Sky City and Saudi Arabia's Kingdom Tower.

But as "cool" as all of these buildings are, glitzy construction booms have historically coincided with the beginnings of economic downturns, according to Barclays' "Skyscraper Index." (For all you economics wonks out there, basically, skyscrapers can be considered a sentiment indicator.) Read More.

OMG - Tokyo 1987?

OCED Warns Australia Housing To Crash

The OECD has warned Australia’s housing market could collapse

  A LEADING authority on the world economy has warned that Australia’s inflated housing market is at risk of a “sharp correction”.

While the Organisation for Economic Cooperation and Development, was forecasting a three per cent growth in our economy next year, thanks to a rise in investment in the non-mining sector and exports, it feared the strength of the country’s property market could result in a “sharp correction” in house prices.

In a report released in Paris on Wednesday, the OECD said if commodity prices continued to fall, it would affect overall revenue and the cutbacks in production could become “substantial”. Read More.

Pop goes the bubble ... An erial view of Altona on Wunulla Road in Point Piper, Sydney. Picture: Supplied Source:Supplied