Mervyn King: the eurozone is doomed (jdargis)
“It will lead to not only an economic but [also] a political crisis,” he says. “Monetary union has created a conflict between a centralised elite on the one hand, and the forces of democracy at the national level on the other. This is extraordinarily dangerous.”
If any of those S&P 500 triggers occur, the benchmark index will decline at least 8.2 percent from Monday’s close to 1,786, a level last seen in February 2014, according to DeMark. Should the market top correspond with what he referred to as “bad news,” the S&P 500 could see deeper selling down to 1,736, an 11 percent decline. DeMark sees the ongoing market rally as temporary relief as investors exit short positions.
The Groundwork, according to Democratic campaign operatives and technologists, is part of efforts by Schmidt—the executive chairman of Google parent-company Alphabet—to ensure that Clinton has the engineering talent needed to win the election. And it is one of a series of quiet investments by Schmidt that recognize how modern political campaigns are run, with data analytics and digital outreach as vital ingredients that allow candidates to find, court, and turn out critical voter blocs.
Financial Precipice à la 1929? (Aaron M.)
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.
Today, the equivalent of those bankers are shareholders. They expect not just interest, but tremendous returns on their initial investments. They witnessed the success of Facebook and Google and want those sorts of returns, too. So they put money into a company like Twitter, and then expect to earn back 100 or 1,000 times on their original investment. The fact that Twitter makes 500 million dollars a quarter is considered an abject failure by the investors. And so Twitter must look for some way to “pivot”—that is, change from a super successful company that lets people send 140-character messages, into something else.
Make Wall Street Your Personal ATM (Tiffany D.)
Acting as a pseudo “insurance salesman,” we collect instant premiums from investors that are insuring portfolio positions, by selling them out-of-the-money put options, or the right to sell us a stock at a price (or strike) much lower than the stock’s current valuation. Investors use put options to protect open positions in their portfolio. When they purchase put options, they are essentially limiting their losses in the event of a correction or crash in the stock — a hazard in the stock market.
Silver Prices in Five Years? (GE Christenson)
Scenario Three – deflation and hyperinflation: Deflationary forces temporarily crash the financial system (signs are visible in 2016-Q1), and eventually central bankers and governments inflate currencies, possibly to hyperinflationary levels in their heavy-handed reaction. In this scenario silver prices will go into the stratosphere – perhaps $150, or $1,500, or $15,000 per ounce. The ultimate silver price in a hyperinflationary scenario is unpredictable since hyperinflationary forces feed upon themselves and destroy purchasing power unpredictably. Gold reached nearly 100 trillion Weimar Marks per ounce in 1923. Gold, if currently priced in 1945 (pre-devaluation) Argentina pesos would be over 10,000 trillion 1945 pesos. Hyperinflation is an ugly, destructive, and unpredictable process.
This crystallized for me after the last GOP debate when Trump told Chris Cuomo in a post-debate interview that the IRS might be coming after him because he’s a “strong Christian.” Set aside for the moment how this unchurched libertine was able to rebrand himself as a “strong Christian.” What about the preposterous claim that he is being persecuted by the IRS because he is a devout member of the country’s dominant religion? Republicans simply aren’t in any position to criticize this ludicrous claim because they have spent years telling their voters that this sort of thing happens all the time – to Christians, conservatives, everyone the liberals at the IRS hate. And this, of course, is just one example of hate and nonsense debt coming due. Shift gears now and they’re “RINOs.”
Gold & Silver
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