Europe Crises, America Crises, Europe Crises, America Crises, and on and on

Asia and Europe Markets Crash...Next up... 

Asian Stocks Open Lower After Europe Selloff; Tokyo's Nikkei Down 1.1%, Seoul Shares Fall 1.8%

 

Bring Out Your Dead - UBS Quantifies Costs Of Euro Break Up, Warns Of Collapse Of Banking System And Civil War

Any time a major bank releases a report saying a given course of action is too costly, too prohibitive, too blonde, or simply too impossible, it is nearly guaranteed that that is precisely the course of action about to be undertaken. Which is why all non-euro skeptics are advised to shield their eyes and look away from the just released report by UBS (of surging 3 Month USD Libor rate fame) titled "Euro Break Up - The Consequences." UBS conveniently sets up the straw man as follows: "Under the current structure and with the current membership, the Euro does not work. Either the current structure will have to change, or the current membership will have to change." So far so good. Yet where it gets scary is when UBS quantifies the actual opportunity cost to one or more countries leaving the Euro. Notably Germany. "Were a stronger country such as Germany to leave the Euro, the consequences would include corporate default, recapitalisation of the banking system and collapse of international trade. If Germany were to leave, we believe the cost to be around EUR6,000 to EUR8,000 for every German adult and child in the first year, and a range of EUR3,500 to EUR4,500 per person per year thereafter. That is the equivalent of 20% to 25% of GDP in the first year. " It also would mean the end of UBS, but we digress. Where it gets even more scary is when UBS, like many other banks to come, succumbs to the Mutual Assured Destruction trope made so popular by ole' Hank Paulson : "The economic cost is, in many ways, the least of the concerns investors should have about a break-up. Fragmentation of the Euro would incur political costs. Europe’s “soft power” influence internationally would cease (as the concept of “Europe” as an integrated polity becomes meaningless). It is also worth observing that almost no modern fiat currency monetary unions have broken up without some form of authoritarian or military government, or civil war." So you see: save the euro for the children, so we can avoid all out war (and UBS can continue to exist). The scariest thing, however, by far, is that for this report to have been issued, it means that Germany is now actively considering dumping the euro.

 

ECB Demands Quick Action From Europe Governments

The current and incoming head of the European Central Bank demanded on Monday that European governments quickly implement a strengthening of a regional bailout fund and press ahead with wider reforms.

 

 

Futures Re-Open...Down

Having twiddled thumbs all day, equity futures just reopened with a modest drop - extending losses from the overnight session - and US credit markets are reflecting European weakness as financials lead us wider.

Think GLD and SLV is safe..and you think you actually own Gold or Silver...Really...

Here's a quote from Harvey Organ...(Google him)

"The two ETF's that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.

There is now evidence that the GLD and SLV are paper settling on the comex.

Thus a default at either of the LBMA, or Comex will trigger a catastrophic event."

Still think the GLD and SLV is safe? then watch the following video...

In The News Today

September 5, 2011, at 2:40 pm
by Jim Sinclair in the category In The News |  Print This Post |  Email This Post

Jim Sinclair’s Commentary

The Panic button is close.

China central banker warns global economic risks increasing BEIJING | Thu Sep 1, 2011 8:45pm EDT
(Reuters) – The global economy faces risks from both slowed growth and persistent inflationary pressure, which is spilling over from emerging to advanced economies, Ma Delun, a vice-governor at China’s central bank, said in comments reported on Friday.
The People’s Bank of China vice-governor’s gloom about world economic prospects echoed earlier comments from Chinese Premier Wen Jiabao, underscoring that Beijing policy-makers are not counting on major foreign markets to recover quickly.
Ma told a financial forum in far western China on Thursday that slower growth in the United States, Europe’s debt problems, and Japan’s poor economic performance were adding to those global risks, the China News Service reported.
"The long-term fiscal sustainability of the United States faces challenges, the European sovereign debt crisis continues to fester, and the Japanese fiscal deficit is growing," the report cited Ma as saying.
"Government debt risks have become a major challenge affecting the global economic recovery," he added.
Ma also warned that "some emerging economies are feeling the consequences of policy contraction, and their rates (of growth) are slowing, and downstream risks to the global economy are increasing," the report said.
More…




If anyone located in Belarus or any other Country experiencing food riots, high inflation or Hyperinflation, and would like to write about it, please email it to wethesheeplez@yahoo.com and I will post it here. 

Thank You  
 

Jim’s Mailbox

September 5, 2011, at 2:39 pm
by Jim Sinclair in the category Jim's Mailbox |  Print This Post |  Email This Post

Mr. Sinclair,

We ran into each at the GATA conference when Mr. Turk interviewed you.
Here is the liquidity pyramid you requested for publishing.

www.creditcontraction.com

www.runtogold.com

Thanks,
CIGA Trace

Forget 'A Winter Of Discontent', Israel's Eisenberg Sees 'Winter Of Radical Islam'

As if we didn't have enough to worry about with sovereign shenanigans in Europe, which bridges to build in the US, and a slowing China, Israel's top-brass now fears a winter of radical Islam, an increase in the chance of a multi-front war, and notes Hamas using a new advanced rocket (perhaps this will be the bazooka that Trichet borrows?).

Guest Post: Unseemly Scramble For Libya’s Post-Gaddafi Oil Assets Underway

While NATO members, led by France, piously proclaimed at the onset of their military offensive in Libya that their concerns were solely humanitarian, a covert tussle to gain a commanding lead in developing the country’s energy riches in light of Colonel Gaddafi’s departure is well underway. The Libyan economy depends primarily upon revenues from the oil sector, which contribute about 95 percent of export earnings, 25 percent of GDP, and 80 percent of government revenue. Prior to the outbreak of conflict, Libya was exporting about 1.3-1.4 million barrels per day from production estimated at roughly 1.79 million barrels per day, of which approximately 280,000 barrels per day were indigenously consumed. But analysts believe that with reconstruction Libya could soon be exporting 1.6 million barrels per day of high-quality, light crude. But current production is the proverbial mere drop in the bucket. Libya has the largest proven oil reserves in Africa with 42 billion barrels of oil and over 1.3 trillion cubic meters of natural gas. Causing oil company executives from Houston to Beijing to drool on their Gucci loafers, only 25 percent of Libya’s territory has been explored to date for hydrocarbons.

RANsquawk Market Wrap Up - Stocks, Bonds, FX etc. – 05/09/11

Submitted by RANSquawk Video on 09/05/2011 - 16:14 ETC RANSquawk

Europe Crises, America Crises, Europe Crises, America Crises, and on and on

If you haven't figured out the weekly cycle between America failing, then off to Europe failing, it should be quite obvious now how the ECB and Federal Reserve are fighting amongst themselves. One of the later Bears videos warned about the currency wars and how they have commenced. We are now in full swing with these and they will intensify as both parties realize they are insolvent and the ONLY way out is to print.

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