Tag Archives: derivatives

  • Podcast

    Janet Tavakoli: Life And Death On Wall Street

    History shows systemic corruption can be overcome
    by Adam Taggart

    Sunday, October 30, 2016, 9:06 PM


    Financial markets and derivatives authority Janet Tavakoli returns to the podcast to discuss a number of the themes contained in her new book Decisions: Life And Death On Wall Street.

    She paints a particularly informative timeline of the greed and rot that has come to dominate the modern financial system, and how its tentacles have fully penetrated and subjugated the halls of power in Washington DC.


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  • Blog
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    Fortunes Will Be Made & Lost When Capital Flees To Safety

    As safe havens are tiny markets
    by Adam Taggart

    Friday, June 24, 2016, 8:46 PM


    Little did I realize when creating the short video below how prescient it would quickly become in the wake of last night's Brexit vote…

    It's message is simple: there's a preponderance of data that shows the world's major asset markets are dangerously overvalued. And when these asset bubbles start to burst, the 'save haven' markets that investment capital will try to flee to are ridiculously small. Investors who do not start moving their capital in advance of crisis will be forced to pay much higher prices for safety — or may find they can't get into these markets at any price.

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  • Insider

    What Awaits Us In The Future Of Higher Interest Rates

    Having an action plan will be the key to preserving wealth
    by Brian Pretti

    Friday, June 26, 2015, 4:53 PM


    Executive Summary

    • Expect a bond market bloodbath as rates rise
    • Municipal, corporate and sovereign defaults will soon follow
    • Liquidity suffers as necessary goods prices rise, but securities prices fall
    • The new, nuclear risk of a derivatives market collapse

    If you have not yet read Part 1: The Global Credit Market Is Now A Lit Powderkeg available free to all readers, please click here to read it first.

    You may remember that what caused then Fed Chairman Paul Volcker to drive interest rates up in the late 1970’s was embedded inflationary expectations on the part of investors and the public at large. Volcker needed to break that inflationary mindset. Once inflationary expectations take hold in any system, they are very hard to reverse.

    A huge advantage for Central Bankers being able to “print money” in very large magnitude in the current cycle has been that inflationary expectations have remained subdued. In fact, consumer prices as measured by government statistics (CPI) have been very low in recent years.

    When Central Bankers started to print money, many were worried this currency debasement would lead to rampant inflation. Again, that has not happened for a very specific reason. For the heightened levels of inflation to sustainably take hold, wage inflation must be present. I've studied historical inflationary cycles and have not been surprised at outcomes in the current cycle in the least, as in the current cycle, continued labor market pressures have resulted in the lowest wage growth of any cycle in recent memory. But is this about to change at the margin?

    The chart below shows us…

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  • Podcast

    Gail Tverberg: This Is The Beginning Of The End For Oil Production

    Why the shale collapse is ushering in a permanent turndown
    by Adam Taggart

    Saturday, January 17, 2015, 5:28 PM


    With the recent collapse in the price of oil, Gail Tverberg, returns to discuss the likely impact on the US shale oil industry, as well as the global market for oil. 

    While as an actuary, Gail is one to avoid hyperbole and the let the numbers speak, her analysis of the outlook for future oil production is nothing short of dire.

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  • Podcast

    Bill Black: The Banks Have Blood on Their Hands

    And our regulators are too fearful to act
    by Adam Taggart

    Sunday, July 14, 2013, 1:13 AM


    We invited Bill Black to return to explain whether the level of systemic risk due to fraud in our financial markets has improved or worsened since the dire situation he painted for us in early 2012. Sadly, it looks like abuse by the big players has only flourished since then.

    In the U.S., our regulators have publicly embraced a "too big to prosecute" doctrine. We are restraining, underfunding, and dismantling regulatory oversight in the interest of short-term stability for the status quo. Which, as a criminologist, Black knows with certainty creates an environment where bad actors will act in their self-interest with assumed (and likely real, at this point) impunity.

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  • Blog
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    Investors Beware: Market Risks Today Are Higher than Ever

    It's time to start worrying about the bond market
    by Chris Martenson

    Thursday, March 21, 2013, 8:42 PM


    After the shot across the bow in 2008, you might have expected regulators and market participants would use the experience to change for the better, to become more prudent, and to reduce the sorts of risky behaviors that almost crashed the entire system.

    Unfortunately, you'd be wrong.

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  • Podcast

    Janet Tavakoli: Understanding Derivatives and Their Risks

    Abuse is the problem
    by Adam Taggart

    Saturday, September 15, 2012, 3:48 PM



    Global financial markets are awash in hundreds of trillions of dollars worth of derivatives. By some estimates, the total amount exceeds one quadrillion.

    Derivatives played a central role in the 2008 credit crisis, as they had a brutal multiplying effect on the magnitude of the carnage. As a bad asset was written down, oftentimes there were derivative contracts written against it that resulted in total losses 10x greater than the initial write-down.

    But what exactly are derivatives? How do they work?

    And have we learned to treat these "weapons of mass financial destruction" (as Warren Buffet colorfully coined them) any more carefully in the aftermath of the global financial crisis?

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  • Blog

    Mapping The Fugly Future with David Collum

    by Adam Taggart

    Friday, February 18, 2011, 2:17 AM


    In the course of his info-scouting, Chris has conversations with many different thinkers. Some are well-known to you; others perhaps less so. An important objective of our podcast interview series is to expose our listeners to the variety of voices and points of view that Chris considers when developing the perspective that he brings to his reporting.

    David Collum may be a new voice to many of you. Like Chris, David came to the field of macroeconomic study from a scientific background. Again like Chris, his published observations and predictions have begun to amass a readership built on respect for his emprical approach to projecting the future. For those of you unfamilar with David’s work, we think you’ll enjoy having this insider’s ear to his recent recorded discussion with Chris, which covers a wide range of topics.

    In short, David sees a world where market risk has been removed (through misguided government intervention), leading to perverse behavior. In many ways, we are repeating the sins of past empires – and he warns us that history has a much higher incident rate of soverign insolvency than we may want to believe.

    Click the play button below to listen to Chris’ interview with David Collum:

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    In this podcast, David and Chris discuss: 

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  • Blog

    Daily Digest 12/12 – China Rates Worries on Gold, Senate Bill Extends IRA Donations, OPEC Dismisses $90 Oil as ‘Blip’

    by DailyDigest

    Sunday, December 12, 2010, 4:00 PM

    • China Rates Worries Weigh On Gold
    • Failed Us Bank Count In 2010 Nears 150-Mark
    • Euro Will Not Fail, Say Wolfgang Schaeuble and John Major
    • Senate Bill Extends IRA Donations, Other Provisions
    • Bond Market Signals No End to Deflation for Eight More Years: Japan Credit
    • A Secretive Banking Elite Rules Trading in Derivatives
    • Swan Takes on Australia’s Four Big Banks With Plan for Greater Competition
    • OPEC Dismisses $90 Oil Price as ‘Blip,’ Maintains Production Targets Again

    Crash Course DVDTake home the Crash Course DVD for an insightful look at the next twenty years. (NTSC or PAL)

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