The contagion of the European Union and banking debt – 20 European Banks have liabilities above 50 percent of their home country GDP. Why an EU FDIC is highly unlikely in the short-term.
The crisis in Europe is boiling over yet again. The central connecting factor of all of this is too much debt relative to production. Debt in itself is not a bad thing. If you borrow modestly for a home and have sufficient income to cover your mortgage payment then this might actually be beneficial. When [...]
The day of reckoning for global total debt – total credit market debt up from $28 trillion in 2001 to $53 trillion in 2012. US consumer debt went up in last few months but largely because of giant amounts of student loan debt taken on.
You have to really question what passes for financial analysis these days. One financial show was discussing the recent increase in consumer debt as something positive. In the same breath this person also said that households increased savings. Now think about this statement. If you financed a $2,000 vacation on your credit card but increased [...]
The financial avarice of the global banking system – U.S. banks insolvent to the tune of $3 trillion. FDIC pretends to have funds to support over $7 trillion in banking deposits.
Part of the big delusion in our banking system is the reality that debt has become a large source of money flowing through the economy. This is why housing made the perfect vessel for Wall Street and banking speculation. Banks create money by issuing loans and there is nothing larger to loan on than a [...]
The brittle financial American middle class – 50 percent of Americans would be in financial trouble if $2,000 of expenses came up in 30 days. By 2020 the world’s richest households will control $202 trillion in wealth, 4 times current global GDP.
This economic recovery has excluded working and middle class Americans which begs the question, what really defines a financial recovery? In past and distant recoveries the economic gains were widely distributed amongst all Americans. Most realize that income gains will never be equal simply because in a market based economy those with certain desirable skills [...]
China’s ghost cities and shopping malls – 14 million empty housing units in the U.S. while China may have up to 64 million empty apartments. GDP is only as good as the quality behind the financial numbers. China real estate bubble.
The Census released data showing that 14 million housing units in the U.S. are categorized as being vacant. As startling as this figure appears on the surface, China has an estimated 64 million empty apartment units. As we enter a perpetual cycle of global financial bubbles, the largest ongoing bubble in the world at the [...]
Financialization Era – how banking welfare captured our economy and ravaged the wealth of the working and middle class. Building profits through financial debt leverage.
The American banking system has transformed the economy into one enormous speculative casino with bells and whistles and free cocktails for those that participate. The problem of course is that most don’t have excess income to drop into the financial slot machines. Now banking in better times should be seen as the lubricant of the [...]
Tracking the Great Recession: Global Industrial Output and World Stock Markets Following the Great Depression.
How the investing world quickly forgets. If we go back into the distant future of March 2009, you would remember that on a panic filled day, the S&P 500 flirted with the 666 low. Since that day, the S&P 500 has rallied an astonishing 41 percent in only a 3-month period. Yet as astonishing as [...]
10 Charts Showing a Prolonged Global Recession: Credit Markets, Housing, and Equity Markets point to Lengthy Economic Contraction.
The IMF came out with a global report on the economy in October of 2008. Since that time, the global economy has deteriorated even further and the IMF has issued another report. I went ahead and looked at both documents and from what is presented, there is very little reason to believe we will see [...]
There is a danger in having power. Credit at least many decades ago was seen almost as an extension of the morality of the borrower. That is, the way credit was given many times reflected the capacity, collateral, and character of the borrower. Main Street is already feeling this recession like the worst since World War II and [...]
There have been many theories floating around the financial press that the world markets are now independent and that having a global depression like times in the past was highly unlikely. For the most part, since the credit crisis took on a full head of steam in August of 2007 most world markets are falling [...]