Eurozone Debt Crisis: Germany ‘Must Let Bailout Fund Grow’

European leaders have united to urge Germany to agree to boost the “big bazooka” bail-out fund this week amid fears that markets will turn against Spain, Ireland and Portugal without urgent support.
by Louise Armitstead, Telegraph.co.uk:
Klaus Regling, head of the European Financial Stability Facility (EFSF), warned that the eurozone must reinforce its firewalls to avoid more market volatility. “More money would reassure markets. Wrongly or rightly the fact is that big numbers in the shop window create calm,” he said over the weekend.
Mario Monti, the Italian prime minister, told a conference that the rise in Spain’s borrowing costs was a warning that “it doesn’t take much to recreate risks of contagion”.
Last night, officials claimed Angela Merkel was prepared to yield to the pressure and agree to combine the firepower of the €440bn (£368bn) EFSF and its permanent replacement, the €500bn European Stability Mechanism (ESM).
However, the German Chancellor is desperate not to anger her electorate by giving more support to the eurozone, especially after her coalition partners struggled in state elections yesterday.
Read More @ Telegraph.co.uk

The First Crack: $270 Billion In Student Loans Are At Least 30 Days Delinquent

Back in late 2006 and early 2007 a few (soon to be very rich) people were warning anyone who cared to listen, about what cracks in the subprime facade meant for the housing sector and the credit bubble in general. They were largely ignored as none other than the Fed chairman promised that all is fine (see here). A few months later New Century collapsed and the rest is history: tens of trillions later we are still picking up the pieces and housing continues to collapse. Yet one bubble which the Federal Government managed to blow in the meantime to staggering proportions in virtually no time, for no other reason than to give the impression of consumer releveraging, was the student debt bubble, which at last check just surpassed $1 trillion, and is growing at $40-50 billion each month. However, just like subprime, the first cracks have now appeared. In a report set to convince borrowers that Student Loan ABS are still safe - of course they are - they are backed by all taxpayers after all in the form of the Family Federal Education Program - Fitch discloses something rather troubling, namely that of the $1 trillion + in student debt outstanding, "as many as 27% of all student loan borrowers are more than 30 days past due." In other words at least $270 billion in student loans are no longer current. That this is happening with interest rates at record lows is quite stunning and a loud wake up call that it is not rates that determine affordability and sustainability: it is general economic conditions, deplorable as they may be, which have made the popping of the student loan bubble inevitable. It also means that if the rise in interest rate continues, then the student loan bubble will pop that much faster, and bring another $1 trillion in unintended consequences on the shoulders of the US taxpayer who once again will be left footing the bill

 

Citigroup Expels The Netherlands From Europe's "Core"

Some bad news for our Dutch readers: AAA-rated Netherlands, which had until now been perceived together with Germany, as one of the two truly core countries of Europe, has just been expelled from the exclusive club by Citi's Jurgen Michels, a move which will likely be bandwagoned shortly by other sellside analysts, and within 3-6 months, the rating agencies as well, because as of now Holland's "untouchable reputation has been tarnished. Not to mention what's left of the bond vigilantes who will likely not take too kindy to this implicit downgrade of Holland. To wit: "While Dutch general government debt remains much below the euro area average (66% of GDP in 2011 compared to 88% for the euro area as a whole) and the centre-right minority government of PM Mark Rutte and Finance Minister Jan Kees de Jager has long been an advocate of strict fiscal rules in the euro area, the Netherlands no longer seems to satisfy all of our other requirements for Core membership. " This means that according to Citi, and shortly everyone else, Germany is now the only true AAA credit in Europe.

Brics’ Move to Unseat US Dollar as Trade Currency

by Thandeka Gqubule and Andile Ntingi, City Press:
South Africa will this week take some initial steps to unseat the US dollar as the preferred worldwide currency for trade and investment in emerging economies.
Thus, the nation is expected to become party to endorsing the Chinese currency, the renminbi, as the currency of trade in emerging markets.
This means getting a Renminbi-denominated bank account, in addition to a dollar account, could be an advantage for African businesses that seek to do business in the emerging markets.
Read More @ CityPress.co.za

Manipulation of the “Paper Gold” Market

The Value of “Worthless” Paper Gold versus Physical Gold
by Bob Chapman, Global Research:
We have been in and around the gold markets for 53 years and conditions have certainly changed, driven mainly by market manipulation of all markets as a result of the Executive Order, which created the “President’s Working Group on Financial Markets.” Those who doubt that are either on the government payroll one way or the other, or you are just too dumb to understand what is really going on. In spite of these machinations and ignorant naysayers the bull markets in gold and silver are still alive and well. What you are seeing are paper markets and the use of derivatives to effect short-term pricing, especially when negative events are about to occur.
Those events are aided by naked shorting and illegal concentration in both gold and silver and the shares. Mind you, this is being done in a market to control it and in addition government and central banks relish stomping gold and silver into the ground. For years they hid what they were doing. Today their manipulations are in your face. These dramatic forced price falls are fortunately accompanied by heavy buying by China, Russia, India and others.
Read More @ GlobalResearch.ca

A Random Walk Through the Economic Data Minefields

by John Mauldin, Market Oracle:
This Friday finds me sleeping later than I planned … in the lounge at the airport in Stockholm, on my way to Paris. To the great applause of readers all over the world this may be the shortest letter in 12 years. I will write here and on the plane and quit when I land so I can be with friends this evening. No time for exhaustive research, so we will march through random topics that caught my attention this week until it is time to hit the send button. In no particular order, let’s jump in.
Sweden, the Socialist Mecca
I was brought to Stockholm to speak for Swedbank. They arranged for me to meet a wide variety of local people, as well as to have dinner with readers. I talked with a number of people who were in positions of authority during the Swedish credit and debt crisis of the early 1990s. And a crisis it was. The currency was under attack, as the fundamentals were negative. This was at the same time that Soros was attacking the British pound. Interest rates had been rising in Sweden, but the financial environment was being loosened. This meant that Swedish businesses and consumers could borrow in foreign currencies that had much lower interest rates, and borrow they did. The central bank made it very clear that they would protect the value of the currency, and everyone believed them. Remember, this is a relatively small country, and basically everyone knows someone who at least knows someone who was involved with the central bank. The central bank was adamant in its belief that it could protect the value of the currency, and it raised rates by 500% in order to do so.
Read More @ MarketOracle.co.uk

 

The Fed Is Losing The "Race To Debase"

As we pointed out about a month ago, in "While You Were Sleeping, Central Banks Flooded The World In Liquidity" as the world was focused on headlines whether or not the Fed would step up as it always does when the market is sliding, and unleash the monetary floodgates, it was not Ben Bernanke, but eveyrone else that hit CTRL+P and took the place of the Fed, of note the primary central banking peers among the Final Four - the ECB, the BOE and the BOJ. And why not: after all the hope was that since electronic money is electronic money, and can be moved from point A to point B at the push of a button, it would be used primarily to reflate stocks around the world, but mostly where the path has least resistance - the US. What was not accounted for was that money would also be used to inflate commodities such as oil - a key factor when delaying further US-based easing in an election year. However, more than even record for this time of year gas prices, there was one even more important outcome from this chain of events. As the following chart from Willem Buiter shows, in its fake attempt to show monetary restraint, the Fed has gone straight into last place in the "race to debase." Needless to say, in a world with $25+trillion in "excess" debt (debt which would need to be eliminated simply to reduce global debt/GDP to a "sustainable" 180% per BCG), last is a very bad place to be...

Things That Make You Go Hmmm... Such As A "Fiscally Credible" UK And Its Upcoming 100 Year Gilts

Firstly, Britain’s ‘safe-haven status’ is a fallacy. It is no more safe than many of the other major economies who are choking on debts that cannot be paid off. The only reason it HAS that status currently is because of the very Achilles Heel that will ultimately prove to be its demise - the ability to print its own currency. By NOT being a part of the euro experiment, Britain has kept control of its fate and has been able to print its way out of trouble - so far - while its neighbours to the east have all been lashed to the deck of the same sinking boat, but the day is coming when Britain’s profligacy will become important again. As I keep saying; none of this matters to anyone until it matters to everyone. Secondly, interest rates may have ‘fallen to a record low’ but they have done so in the same way heavily-indebted gamblers often ‘fall’ from hotel rooms - with a big push (only this time from the Bank of England and not a guy called Fat Tony). Like US Treasurys,  the price of UK gilts would be nowhere near these levels without a captive and very friendly buyer in the shape of the central bank.

Pento – Ultimate Collapse & Real Reason Interest Rates Rising

from King World News:
Today Michael Pento accused the mainstream media of misleading the public once again. Pento, who founded Pento Portfolio Strategies, writes exclusively for King World News about the ultimate collapse and the real reason interest rates are rising: “The prevailing notion among the mainstream media and economists is that interest rates are rising because of improving economic growth. But like many of the readily accepted tenets of today’s world of popular finance, this too has its basis in fallacy.”
Read More @ KingWorldNews.com

Washington Post Partners with Chinese Government to Publish Pure Propaganda

by J. D. Heyes, Natural News:
(NaturalNews) It’s bad enough with supposedly unbiased news outlets in the U.S. shill for one political ideology over another, but when an American newspaper becomes an advocate for a foreign rival, that’s over the line.
That’s the opinion, at least, of a number of journalists and media experts who are questioning the ethics – and legality – of the publication of what they call little more than Chinese propaganda by the Washington Post (WP), the paper that broke the Watergate scandal in 1974 that led to the resignation of President Richard M. Nixon.
The paper’s China Watch publication, a print and online advertising supplement that purports to present news and information about the Asian economic giant, instead hosts a number of articles portraying the Chinese government favorably, especially in relation to its human rights record.
Read More @ NaturalNews.com

NY Times Floats the Corzine 'CEO Defense'

more »

 

Thoughts On Inflation

Admin at Marc Faber Blog - 4 hours ago

What is inflation? Inflation can manifest itself in wages, consumer prices, in asset prices such as real estate, equities, commodities and so forth...art and collectibles. Now the problem is that those asset prices won`t increase at the same rate, at the same time. But it`s a symptom of monetary inflation. *Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.* more »

 

CNBC Video: China`s Slowdown

Admin at Jim Rogers Blog - 4 hours ago

CNBC video interview: Jim Rogers comments the potential slowdown in the chinese economy; *Related, iShares FTSE/Xinhua China 25 Index ETF (FXI)* *Jim Rogers is an author, financial commentator and successful international investor. He has been frequently featured in Time, The New York Times, Barron’s, Forbes, Fortune, The Wall Street Journal, The Financial Times and is a regular guest on Bloomberg and CNBC.* more »

 

HUI - deeply oversold and nearing support

Trader Dan at Trader Dan's Market Views - 17 hours ago

The mining shares have been absolutely obliterated over the course of the last couple of months as their longsuffering owners can all too sadly attest. The carnage however has dropped the index deeply into oversold territory on the weekly price chart. If you notice the chart carefully, this particular indicator which I have tweaked a bit to optimize it to the index, is now nearing levels seen only TWICE since the entire bull market began. Not only that, it is also nearing an important Fibonacci retracement level of the rally that began off the 2008 low before peaking last fall. Bet... more » 

 

 

How Housing Affordability Can Falter Even as House Prices Decline

by Charles Hugh Smith, Of Two Minds:
The assumption that lower home prices improves the affordability of houses ignores two critical inputs: interest rates and income.
That the U.S. housing market is still in a post-bubble slump is no secret, as revealed by this chart courtesy of streettalklive.com: note that despite unprecedented intervention, including the complete socialization of the U.S. mortgage market (99% of all mortgages are guaranteed by the Federal government) and the socialization of subprime market for poor credit risks (3% down and easy credit from FHA), this chart punctures the happy-talk illusions of a rebound in housing.
Read More @ OfTwoMinds.com

The Bernank Goes to College

by James Turk, FGMR:

March 21, 2012 – Earlier this week Federal Reserve chairman Ben Bernanke gave a lecture to students at George Washington University. It was the first of a four-part series in a course entitled “The Federal Reserve and Its Role in Today’s Economy.” Interestingly, ZeroHedge notes that in his lecture: “The words Gold and Standard appear more times than Central and Bank”.
The text of the speech is not yet available on the Fed’s website, but Business Insider provides a summary of it. Not mincing any words, and with its extreme religious devotion to today’s fiat currencies all too apparent, Business Insider enthusiastically exclaimed that Mr. Bernanke “just murdered the gold standard”.
Given that sensational headline, I thought it might be useful to present the other side of the story. Here are Business Insider’s comments (in italics) meant to disparage gold, followed by my observations.
Read More @ FGMR.com

  

Mf Global’S Jon Corzine May Have Given Instructions To Pillage Client Funds

 

 

Big Banks Continue to Suck at the Government Teat With Never-Ending Stealth Bailouts

Open-Ended Bailouts Are Continuing
from Washington’s Blog:

We’ve previously documented the fact that bailouts of the big banks are continued in stealth mode up to the present day.
True, the banks claim they’ve repaid the Tarp bailout funds … but nearly half of the banks “repaid” such bailout funds by borrowing from other government bailout funds (and the rest could only repay money by fudging their accounting and using stealth bailouts which are are a little harder to detect).
Indeed, the government has decided on perpetual bailouts for the too big to fail banks.
Some of the ongoing stealth bailouts include:
Read More @ WashingtonsBlog.com

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