Daily Digest

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Daily Digest 6/28 - Chinese Stock Bubble Bursts, Greece To Shut Banks To Avert Collapse

Sunday, June 28, 2015, 7:17 AM

Economy

The Chinese Stock Bubble Bursts: Any Questions? (sand_puppy)

When financial authorities are in full-blown panic, they cut rates. When financial authorities are in full-blown panic, they deny being in a panic, which proves they are in a full-blown panic.

A reasonable technical target is the 200-week moving average, roughly 50% of the recent high. "Impossible," say recent buyers of Chinese stocks. Yes, of course it is. The authorities will never let the market decline by 50%. As always, this time it's different.

Panic Among Hedge Fund Investors in Greece (jdargis)

But there is no getting around the truth of the matter, he said. Without a deal with its European creditors, the country will default and Greek stocks and bonds will tank when the markets open.

Explaining the Greek Debt Crisis and What It Means for the Eurozone (jdargis)

Meanwhile in Greece, the Parliament approved a request from Prime Minister Alexis Tsipras for a public referendum on Greece’s debt negotiations, to be held next Sunday. Mr. Tsipras said he was calling the referendum because Greece’s creditors — the International Monetary Fund, the European Central Bank and the eurozone countries — had refused to negotiate in good faith and present a fair compromise.

Greece Shuts Banks to Avert Collapse After ECB Freezes Support (jdargis)

Banks will remain shut until at least after a July 5 referendum called by Prime Minister Alexis Tsipras on whether to accept austerity in exchange for a European bailout, Kathemerini newspaper reported, citing unnamed sources.

Three attacks deepen fears about Islamic State’s global reach (jdargis)

The group is still seen as primarily focused on its regional ambitions in Iraq and Syria, where the Islamic State has maintained its grip on large tracts of territory despite recent military setbacks. U.S. officials have said that the organization seems far less driven to launch elaborate, overseas terrorist plots than al-Qaeda and its affiliates.

Changes large and small causing recyclers to struggle (jdargis)

On top of those issues, one major consumer of recyclables—China—has implemented recent changes that add to recycling woes. These include new regulations on importing materials as well as a new emphasis on the use of domestic sources. A general slowdown of manufacturing in the country hasn't helped, either.

Don’t Worry So Much About Whether Your Food is ‘Processed’ (jdargis)

There are different levels of processing, as Mandy Oaklander wrote in Time when reporting on a recent study. A bagged salad would count as “minimally processed.” A single food that has just had something added to it, like oil or sugar, would be “basic processed.” “Moderately processed” foods have additives but are still recognizable in their true form as meat or vegetables or what have you. “Highly processed” foods are made of multiple ingredients, and there’s no way to know where anything originally came from. In the study, 61 percent of Americans’ calories came from highly processed foods, and 16 percent from moderately processed.

How breaking a glacier makes the Earth quake (jdargis)

Over two months, they caught ten calving events that generated glacial earthquakes detected by the global network of seismometers. In one representative example, a 790-meter-thick iceberg with a top area of almost half a square kilometer cracked off and rotated up onto its side. During that process, which took several minutes to play out, the GPS sensors back from the edge moved about ten centimeters back away from the water, before shifting back to their original position. The sensors also sunk downwards a similar amount, only to bob back up.

Gold & Silver

Click to read the PM Daily Market Commentary: 6/26/15

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

11 Comments

Tall's picture
Tall
Status: Platinum Member (Offline)
Joined: Feb 18 2010
Posts: 564
Scientists Detect Mysterious Warming in U.S. Coastal Waters

Oceanographers are puzzled by an accelerated burst of warming sea that threatens the fisheries of the American Atlantic coast.

Meanwhile, off the US West coast, scientists report that they have been baffled by a mysterious “blob” of water up to 4°C warmer than the surrounding Pacific, linked to weird weather across the entire country.

http://www.truthdig.com/report/item/scientists_detect_mysterious_warming...

thc0655's picture
thc0655
Status: Diamond Member (Online)
Joined: Apr 27 2010
Posts: 1714
Sometimes events move quite quickly

Since 2010 I've been educating myself regarding economics, investing, economic history and retirement strategies.  One thing I've been doing along those lines is going back and learning about economic events that I never paid attention to when they occurred. This 49 minute BBC documentary regarding the Black Wednesday (16 September 1992) collapse of the British pound was very helpful and may shed some light on events unfolding this week in Greece and Europe.   British currency and economic problems simmered for months and years, and then all on one day the bottom fell out. Shocking!  

1. Black Wednesday proved that "something is not a fact until it's been officially denied."  

2. Big moves can happen all at once.  In attempting to defend the Pound, the Bank of England raised their interest rate 5% ON ONE DAY (from 10% to 12%, then to 15%). And here we are puzzling over whether the Fed is going to raise rates just one time by maybe 0.25%, and if that will usher in the end of the world!

3. When things begin to move quickly the politicians can be nearly clueless and out of the loop (re: critical information they need to make decisions).

4. The events of Black Wednesday may have seemed like a thunderbolt out of the blue to most people, but wise observers not only anticipated what was coming but maneuvered to make a killing on what they knew was going to happen eventually.  George Soros was such a speculator who basically "bet the farm" that the Pound would fall in value and reaped about $1 billion in profit.  

https://www.youtube.com/watch?t=1201&v=K_oET45GzMI

Will there be such a day in Greece/Europe this week?  Or will we continue to stagger along at the glacial pace we've seen for four years?  Get some popcorn and pull up a seat. smiley  This is a lot more exciting following momentous events as they happen than learning about them 23 years later as a history lesson.

cmartenson's picture
cmartenson
Status: Diamond Member (Offline)
Joined: Jun 7 2007
Posts: 5971
Greece teaches us...

Greece teaches us to panic early and avoid the rush.

People are desperately queuing for petrol, at ATM's with cash, and shopping like crazy at the grocery stores.

While this all makes sense on one level, it is irresponsible and hoarding to be doing it at this late stage.  How could these people *not* have seen this coming from a mile away?

But they didn't and so they are now panicking, and that vibe is hard to dislodge once it spreads.

Our advice at PP has been and will continue to be that everyone should prepare as best they can before the crisis hits, when it is a prudent and responsible thing to do, because once the crisis sets in it is neither of those things.

These pictures tell the tale: http://www.zerohedge.com/news/2015-06-28/ignoring-tsipras-plea-calm-greeks-storm-atms-stores-gas-stations  

davefairtex's picture
davefairtex
Status: Diamond Member (Online)
Joined: Sep 3 2008
Posts: 5691
bolts from the blue

Tom-

...The events of Black Wednesday may have seemed like a thunderbolt out of the blue to most people, but wise observers not only anticipated what was coming but maneuvered to make a killing on what they knew was going to happen eventually.  George Soros was such a speculator who basically "bet the farm" that the Pound would fall in value and reaped about $1 billion in profit.

That very same thing occurred when the US devalued gold soon after Roosevelt took office in 1933.  To some people it was a shock (possibly because during his campaign, Roosevelt stoutly denied he would do such a thing) but after winning the election and in the 3 months prior to taking office, he refused comment on the issue.

Traders had three months to react.  Money poured out of the US as the smart traders positioned themselves for the devaluation; once it came, money rushed back to the US to collect on that 75% move.  The smart money made an absolute killing.

Smart money has fled Greece.  If/when Greece leaves the Eurozone and defaults, all that money will rush right back into the country, to buy all the real stuff that is now selling for 50% off.

Jbarney's picture
Jbarney
Status: Silver Member (Offline)
Joined: Nov 25 2010
Posts: 233
Watching with Interest

I have to admit this was one of the moments a lot of us were waiting for....where banks would be shut down and those who failed to watch the big picture were trying to catch up getting food, supplies, etc.  It is 6:33 am here on the east coast of the US and I imagine the events of Greece for the business day are almost over.  Will be interesting to get news tidbits here and there.   The reaction of European markets will also be worth watching.

KennethPollinger's picture
KennethPollinger
Status: Platinum Member (Offline)
Joined: Sep 22 2010
Posts: 656
Chris, good links needed

Recently you have ;posted quite a few good references but for some reason have not posted them so that we can just click onto them for viewing.  Please be aware of this.  Thanks,  Ken

pinecarr's picture
pinecarr
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Joined: Apr 13 2008
Posts: 2259
Greece Debt Crisis Live coverage on The Guardian(UK)

"Greece debt crisis: markets slide after capital controls imposed - live"

http://www.theguardian.com/business/live/2015/jun/29/greek-crisis-stock-markets-slide-capital-controls-banks-closed-live#block-559109cee4b024248ae9a6bf

Excerpt:

There have been scenes of panic in northern Greece where pensioners have reportedly fainted outside banks in Salonika.

From Athens, Helena Smith reports:

Reports of panic outside banks, in supermarkets and at petrol stations are now coming through thick and fast. Pensioners, waiting outside closed banks in Salonika, collapsed when it became apparent that the lenders weren’t going to open and they would not be getting their monthly allowance.

An announcement may come later today...

In Crete, gas stations were also forced to close after running out of petrol.

And info from another excerpt:

Greece's FinMinistry to announce at 4 pm local time, which bank branches will be open for pensioners to withdraw pensions capitol controls

5:01 AM - 29 Jun 2015

 

 

KennethPollinger's picture
KennethPollinger
Status: Platinum Member (Offline)
Joined: Sep 22 2010
Posts: 656
MUST, MUST WATCH!!!

PLEASE, please, I beg you to watch the video that thc0655 posted above.

Is this a picture of what might happen here??

Especially at 33:15 where the gov officials ADMIT that they were out of contact with the markets!!  INCREDIBLE!  INCREDIBLE!!  49:50 minutes long and worth every second.  The Bank of England LOST 24 Billion trying to support the currency--in one day, maybe even just a few hours.

I can't help but think that even though Germany LOST two world wars. They are winning the THIRD WORLD War, without guns and tanks, etc.  Just look at GREECE!!

Soros bet against the pound, should we bet against thew dollar???????????

COMMENTS.     Ken

Time2help's picture
Time2help
Status: Diamond Member (Offline)
Joined: Jun 9 2011
Posts: 2888
US market's open and...

...CTRL-P. 

Meh.

 

Wendy S. Delmater's picture
Wendy S. Delmater
Status: Diamond Member (Offline)
Joined: Dec 13 2009
Posts: 1988
CTRL-P evenually has to fail

The question is, when?

Time2help's picture
Time2help
Status: Diamond Member (Offline)
Joined: Jun 9 2011
Posts: 2888
Re: CTRL-P
Wendy S. Delmater wrote:

The question is, when?

Oh, I'm with you Wendy. Just wondering if I should be under- or over-estimating Oz and the power of CTRL-P today.

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