Global Debt Time Bomb explodes soon

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Thu Nov 21, 2019 5:07 am

Lebanon Lost $10BN In Bank Deposits Since August; Bond Yields Soar Past 100% Into "Venezuela Territory"

https://www.zerohedge.com/economics/leb ... -territory

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Re: Global Debt Time Bomb explodes soon

Post by MPMalloy » Thu Nov 21, 2019 6:42 pm

absinthe beginner wrote:
Thu Nov 21, 2019 5:07 am
Lebanon Lost $10BN In Bank Deposits Since August; Bond Yields Soar Past 100% Into "Venezuela Territory"

https://www.zerohedge.com/economics/leb ... -territory
de fook'd

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Fri Nov 22, 2019 12:58 pm

The World's Ultra-Rich Scramble To Find Safe-Deposit Boxes Ahead Of The Next Crash

https://www.zerohedge.com/personal-fina ... next-crash

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Sun Nov 24, 2019 9:30 am

John Mauldin sees an ugly conflict coming soon to the US as their official debt levels become unsustainable and they face a "Great Reset".

https://www.interest.co.nz/opinion/1027 ... els-become

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Thu Nov 28, 2019 1:51 pm

Well this is interesting. Are cash-strapped banks starting to "re-hypothecate" (steal) depositors' money?

Russian trader files $1bn lawsuit in New York against Lebanese bank

https://www.debka.com/mivzak/russian-tr ... nese-bank/

The IMMS has filed a suit in the Supreme Court of the State of New York against the a Beirut bank for failing to return its $1bn deposit. The IMMS, traders in European, Middle East and Asian oil, is a branch of the Russian oil giant Rosneft. BankMed belongs to the family of Prime Minister Saad Hariri. After the deposit was demanded on Nov. 8, the bank replied on the 12th that it was terminating the IMMS’ credit facilities “due to the materially adverse change in the economic condition of Lebanon and the Lebanese financial market.” Market sources say that more suits are piling up against Lebanese banks. since they imposed restrictions on transfers and withdrawals to stem a hard currency shortage and capital flight as the country began sinking into political unrest and economic crisis.

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Re: Global Debt Time Bomb explodes soon

Post by MPMalloy » Thu Nov 28, 2019 2:43 pm

absinthe beginner wrote:
Thu Nov 28, 2019 1:51 pm
Well this is interesting. Are cash-strapped banks starting to "re-hypothecate" (steal) depositors' money?

Russian trader files $1bn lawsuit in New York against Lebanese bank https://www.debka.com/mivzak/russian-tr ... nese-bank/

The IMMS has filed a suit in the Supreme Court of the State of New York against the a Beirut bank for failing to return its $1bn deposit. The IMMS, traders in European, Middle East and Asian oil, is a branch of the Russian oil giant Rosneft. BankMed belongs to the family of Prime Minister Saad Hariri. After the deposit was demanded on Nov. 8, the bank replied on the 12th that it was terminating the IMMS’ credit facilities “due to the materially adverse change in the economic condition of Lebanon and the Lebanese financial market.” Market sources say that more suits are piling up against Lebanese banks. since they imposed restrictions on transfers and withdrawals to stem a hard currency shortage and capital flight as the country began sinking into political unrest and economic crisis.
Was the deposit funds that had been borrowed? (the bank called the loan due?)

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Re: Global Debt Time Bomb explodes soon

Post by Stercutus » Fri Nov 29, 2019 8:19 am

Whelp my 90 day prediction didn't work out. I'm going to go ahead and make another one. World Economy is over and done with. We will all be eating out of dumpsters by the end of say... March. Remember you heard it here first.
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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Fri Nov 29, 2019 9:21 pm

China Braces For December D-Day: The "Unprecedented" Default Of A Massive State-Owned Enterprise

https://www.zerohedge.com/economics/chi ... enterprise

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Re: Global Debt Time Bomb explodes soon

Post by Stercutus » Sat Nov 30, 2019 10:15 am

absinthe beginner wrote:
Fri Nov 29, 2019 9:21 pm
China Braces For December D-Day: The "Unprecedented" Default Of A Massive State-Owned Enterprise

https://www.zerohedge.com/economics/chi ... enterprise
Won't happen.
You go 'round and around it
You go over and under
I go through

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Sun Dec 01, 2019 6:16 pm

Is Lebanon's Central Bank A Ponzi Scheme?

https://www.zerohedge.com/geopolitical/ ... nzi-scheme

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Sun Dec 08, 2019 6:23 pm

Is A Global Crash Just Around The Corner? Central Banks Are Cutting At The Fastest Rate Since The Financial Crisis

https://www.zerohedge.com/markets/globa ... ial-crisis

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Sat Dec 14, 2019 12:07 pm

Fitch warns Lebanon likely to default as rating cut again

https://english.alarabiya.net/en/busine ... again.html

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Sun Dec 15, 2019 1:18 pm

Hundreds Of Billions In Gold And Cash Are Quietly Disappearing

https://www.zerohedge.com/markets/hundr ... sappearing

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Re: Global Debt Time Bomb explodes soon

Post by raptor » Mon Dec 16, 2019 11:53 pm

Gold and USD disappear because both are stores of value. If you have a choice of Venezuelan pesos or USD which would you chose?
You choose gold or USD and put it under your mattress or in a vault.
Indeed, while banks are printing more bank notes than ever and, these seem to be "disappearing off the face of the earth" and nobody knows where or why. or as the WSJ notes, "central banks don’t know where they have gone, or why, and are playing detective, trying to crack the same mystery."

We do know one thing: of the $1.7 trillion in US dollars in cash circulation in 2018 (up from $1.2 trillion 5 years prior), the vast majority is offshore, where it is quickly and quietly disappears as the world's second best physical store of value (after gold of course). A Fed economist, Ruth Judson, wrote in 2017 that about 60% of all U.S. currency, and about 75% of $100 bills, had left the country by the end of 2016 — for a total of about $900 billion in U.S. dollars kept overseas. Socking those bills away "provides some protection against economic turmoil, especially in countries with a record of instability in their own financial systems", the paper said.

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Tue Dec 17, 2019 10:04 am

El-Erian Fears The Global Economy's Luck May Run Out

https://www.zerohedge.com/economics/el- ... ay-run-out

Gregory Manarino - Stocks turn up on more bad news. Makes perfect sense in a world where there is no true price discovery left, just central bank intervention in the markets.

https://www.youtube.com/watch?v=eDrK49OGYR8

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Re: Global Debt Time Bomb explodes soon

Post by MPMalloy » Tue Dec 17, 2019 9:05 pm

raptor wrote:
Mon Dec 16, 2019 11:53 pm
Gold and USD disappear because both are stores of value. If you have a choice of Venezuelan pesos or USD which would you chose?

You choose gold or USD and put it under your mattress or in a vault.
Indeed, while banks are printing more bank notes than ever and, these seem to be "disappearing off the face of the earth" and nobody knows where or why. or as the WSJ notes, "central banks don’t know where they have gone, or why, and are playing detective, trying to crack the same mystery."

We do know one thing: of the $1.7 trillion in US dollars in cash circulation in 2018 (up from $1.2 trillion 5 years prior), the vast majority is offshore, where it is quickly and quietly disappears as the world's second best physical store of value (after gold of course). A Fed economist, Ruth Judson, wrote in 2017 that about 60% of all U.S. currency, and about 75% of $100 bills, had left the country by the end of 2016 — for a total of about $900 billion in U.S. dollars kept overseas. Socking those bills away "provides some protection against economic turmoil, especially in countries with a record of instability in their own financial systems", the paper said.
Please post a link to -or- the title of this article.

Thank you.

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Re: Global Debt Time Bomb explodes soon

Post by RoneKiln » Wed Dec 18, 2019 2:14 am

It's in the post above the one you quoted.
"Seriously the most dangerous thing you are likely to do is to put salt on a Big Mac right before you eat it and to climb into your car."
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Re: Global Debt Time Bomb explodes soon

Post by raptor » Wed Dec 18, 2019 12:21 pm

MPMalloy wrote:
Tue Dec 17, 2019 9:05 pm
Please post a link to -or- the title of this article.

Thank you.
Yes sorry I was quoting the article in the link above by absinthe beginner.
https://www.zerohedge.com/markets/hundr ... sappearing

I was also simply noting that if the paper currency is disappearing overseas & not being returned to circulation in the US that is clear evidence of hoarding USD due to a fear of holding local currency....(BTW that is opinion not necessarily fact)

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Re: Global Debt Time Bomb explodes soon

Post by MPMalloy » Wed Dec 18, 2019 1:59 pm

raptor wrote:
Wed Dec 18, 2019 12:21 pm
MPMalloy wrote:
Tue Dec 17, 2019 9:05 pm
Please post a link to -or- the title of this article.

Thank you.
Yes sorry I was quoting the article in the link above by absinthe beginner.
https://www.zerohedge.com/markets/hundr ... sappearing

I was also simply noting that if the paper currency is disappearing overseas & not being returned to circulation in the US that is clear evidence of hoarding USD due to a fear of holding local currency....(BTW that is opinion not necessarily fact)
IYO, what should the common folk here hold (AFA: FOREX, PM, Crypto...)

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Re: Global Debt Time Bomb explodes soon

Post by raptor » Wed Dec 18, 2019 5:09 pm

MPMalloy wrote:
Wed Dec 18, 2019 1:59 pm
raptor wrote:
Wed Dec 18, 2019 12:21 pm
MPMalloy wrote:
Tue Dec 17, 2019 9:05 pm
Please post a link to -or- the title of this article.

Thank you.
Yes sorry I was quoting the article in the link above by absinthe beginner.
https://www.zerohedge.com/markets/hundr ... sappearing

I was also simply noting that if the paper currency is disappearing overseas & not being returned to circulation in the US that is clear evidence of hoarding USD due to a fear of holding local currency....(BTW that is opinion not necessarily fact)
IYO, what should the common folk here hold (AFA: FOREX, PM, Crypto...)
Opinion not fact or advice follows:
Nothing is without risk...nothing. Everyone is different and everyone has a different appetite for loss. YMMV

In the US right now, for the foreseeable future the biggest risk is inflation.

The official index is running 3%+ assuming you do not eat or use energy and closer to 5% if you eat and use energy.
So holding cash in the form of Federal Reserves notes will cost you 5% a year.
Gold and silver while up are volatile and not really an inflation hedge that people who sell it claim.

I suggest a cash reserve in an interest bearing account like 2 separate CDs for a year of expenses. I do not see a banking holiday like Lebanon as likely in 2020. So if you need the $ you can always cash out one of the CDs early and simply forfeit the accrued interest if you need it. Still that CD will not keep up with inflation but it will at least minimize this cost.

If you go with PMs buy US coins like the US $1 silver dollar and the $50 gold coin. The reason for this is that if the price of PMs drop they are still legal tender up to the face value of the coin. It would not be fun to get only $50 for a US gold coin that cost $1,500 but at least it is floor in value. (full disclosure I am not a gold bug and really do not like PMs for a variety of reasons)

Anything over the year in cash savings you need to consider age and risk aversion but I typically expect to see a consistent ROI equal to the rate of inflation plus .5% to 2% on any portfolio I deal with (which always follows a conservative investment & very diversified management style albeit one which does accept market risk).

In the present interest rate environment where a decline in the rate is more likely than an increase a bond fund like Vanguards' VWEAX may a place for some funds at least until it looks like the interest rate will increase. These funds are not where you want your money when interest rates are rising.

If you fear a 2008 repeat the only thing that did not lose value then was cash either in hand, in a CD or in Treasuries. Even PMs got their ass handed to them. The joke then was that there are only 2 positions to hold; Cash or fetal.

Cash BTW is the exact opposite holding to have in a high inflation environment like for instance Venezuela.

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Re: Global Debt Time Bomb explodes soon

Post by raptor » Thu Dec 19, 2019 5:22 pm

Now this is interesting.
https://www.wsj.com/articles/swedish-ce ... 1576745336

I could not understand why anyone would buy a bond or deposit into an account with a negative yield. Though this explains why central banks like the concept:
All central banks watch each other,” said Laurence Boone, chief economist at the Organization for Economic Cooperation and Development. “I don’t think negative rates have ever been seen as there to stay forever.”

By discouraging commercial banks from parking their money at central banks, negative rates prod financial institutions to lend at low cost to other banks, businesses and consumers, in turn pushing people to borrow more, spend more and save less. Negative rates can also weaken the national currency, delivering a boost to exports and increasing prices of imported goods to fuel inflation.

This is a logical response to negative interest rates:
Subzero rates have also pushed more money into equities and bonds, with holdings in mutual funds reaching all-time highs since rates went negative, said Gustav Sjöholm, savings economist at the Swedish Investment Fund Association.

As inflation has picked up and the interest paid on bank deposits has fallen, Eric Entrena, an administrator in the Swedish school system, has sunk more money into stocks. “If you have inflation of 2%, you will have 2% less money,” says Mr. Entrena, 45. “What I’m trying to do is buy shares.”

BTW The Swedish Central Bank is also worried about inflation.
On Thursday, the Riksbank raised the key rate to zero from minus 0.25%. The bank moved because a majority of its policy makers expect inflation to be close to its 2% target over the coming years. Some policy makers have also become more concerned that a longer period of negative interest rates could lead businesses and households to take on too much debt, or force banks to charge to accept deposits, which could lead to a rush into cash.

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Re: Global Debt Time Bomb explodes soon

Post by absinthe beginner » Tue Dec 24, 2019 12:48 pm

El-Erian Warns: "My Main Worry Is Europe"

https://www.zerohedge.com/geopolitical/ ... rry-europe

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Re: Global Debt Time Bomb explodes soon

Post by MPMalloy » Fri Dec 27, 2019 4:02 pm


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Re: Global Debt Time Bomb explodes soon

Post by Stercutus » Sun Dec 29, 2019 6:52 am

I could not understand why anyone would buy a bond or deposit into an account with a negative yield.
It is shocking the number of people who pay for checking accounts.
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