Imagine your doctor put you on a daily dose of oxycontin, phenobarbital and Quaaludes for six years straight. Then he suddenly cancelled your prescription. Do you think your behavior might become a bit erratic?
This is what’s going on with the stock market. It’s trying to shake off six years of overmedication brought on by the Fed’s zero rates and liquidity injections.
Let me explain: Until recently, stocks had been on a tear that pushed valuations into the stratosphere. Volatility stayed low because Bernanke’s easy money and QE made investors more placid, serene and mellow.
Glencore Could Trigger A Global Derivatives Nuclear MeltdownSeptember 28, 2015
The middle class in America is like the housewife who knows her husband is cheating on her but she chooses to ignore it and pretend it will stop. – Anonymous FOD – Friend of Dave’s
The system has been totally hijacked. Make NO mistake about it, gold was hit hard when the paper trading in London cranked up after the SGE had turned off its lights for the day. The reason: Glencore.
Anyone remember Enron? Probably not. Most people have already forgotten, mostly, that their taxpayer dollars were used by ex-Goldman CEO Henry Paulson to bail out Goldman Sachs in 2008 when he was Treasury Secretary. His primary motive was to preserve the value of the $250 million in warrants he still owned after he got to unload $500 million in stock – tax-free. Recently Zerohedge found a snapshot of Paulson laughing about the entire matter.
Glencore is going to make Enron look like a polite tea and cake break. Gold was smashed when paper London opened because the Fed, BoE and ECB can not under any circumstances let the price of gold spike up – like it should be doing – and thereby alert the world that there’s a big problem in the world of derivatives related to Glencore, among other “things” (Emerging Market FX contract, energy, Biotech ETFs, etc).
The issue with Glencore, since we all saw it coming which means the Central Banks saw it coming, is the degree to which the CB’s have been able to “brace” for its impact. The problem, however, is that just like Enron and the big banks before it, there is 100% probability that Glencore upper management has: a) lied about the market value of its assets, both on and off balance sheet; b) has lied about the true amount and nature of its derivatives exposure; c) has been lied to by rank and file who are in charge of accounting and reporting the data to upper management (trust, me I know this goes on because I saw it first-hand at Bankers Trust; and foremost, e) has NO idea the true nature of its total exposure to the full lunar eclipse world of OTC derivatives.
The first radioactive material from the 2011 Fukushima nuclear disaster has now been detected in the coastal waters of North America, according to a study conducted by researchers from Woods Hole Oceanographic Institution.
“Radioactivity can be dangerous, and we should be carefully monitoring the oceans after what is certainly the largest accidental release of radioactive contaminants to the oceans in history,” researcher Ken Buesseler said.
In March 2011, a massive earthquake and tsunami caused three separate nuclear meltdowns at Japans’ Fukushima Daiichi nuclear power plant. The explosion ejected massive amounts of radioactive material into the air, much of which ended up in the Pacific Ocean.
Submitted by Tyler Durden on 09/28/2015 - 21:20 Following on from a weak Europe and US session (despite late-day heroics in China last night), Fed confusion and commodity-complex counterparty-risk-concerns have sparked further turmoil across AsiaPac in the early going. Noble Group (asia's Glencore) is crashing, down 6.7% at the open. FX markets are seeing outflows send CNH below CNY for the first time since July and crush Thai Baht to its weakest since Jan 2007. Equity markets are in trouble with Aussie stocks hammered (driven by a plunge in Miners) and Nikkei 225 down 1000 points from Friday's highs. Asia credit markets have spiked to 2-year wides. China injected another CNY40bn and strengthened the fix (by the most since 9/2) for 2nd day in a row.
Submitted by Tyler Durden on 09/28/2015 - 20:45 The U.S. dollar is looking good worldwide and, in fact, so is gold - it’s just that, at present, the dollar is in the number one spot. But, unlike gold, the dollar is at risk. U.S. debt has placed it in a precarious position from which it will most certainly fall. The dollar is not a truly strong currency; it is essentially, “the best looking horse in the glue factory.” It will be the last to go, but it will indeed go. We may have a bit of time before that happens. Whether it’s measured in months or years, we can’t be certain. A gold mania is not imminent, but we believe it is inevitable.
Submitted by Tyler Durden on 09/28/2015 - 20:19 The story of the mysterious Nazi train was all but forgotten until earlier today, when AFP reported that while the Polish propaganda machine has been busy to neutralize any speculation that such a train may indeed exist (or have been discovered) even though it explicitly admitted as much just a month ago, Poland's army confirmed that it has begun inspecting the southwestern area where two men claim to have discovered an armoured Nazi gold train buried at the end of World War II.
Submitted by Tyler Durden on 09/28/2015 - 19:45 The solution is not to let politicians redistribute the wealth from the rich to the poor. Crony capitalism must be replaced by true free market capitalism, practiced with integrity, fairness, principled conduct, intelligence, and high moral standards. Profits generated by corporations are not evil, but seeking profits at any cost to society is reckless, shortsighted and immoral. Capitalism without capital is destined for failure. When corporate CEOs, Wall Street bankers, and shady billionaires exercise undue influence over the financial, political and judicial systems, their short-term quarterly profit mindset and voracious appetite for riches override the best interests of the people and create a sick, warped, repressive society. Today our system is in the grasp of psychopaths whose hubris and myopic focus on enriching themselves will ultimately be their downfall.
Submitted by Tyler Durden on 09/28/2015 - 19:15 To the extent the memory of Fukushima had faded over the last several years, the "fallout" (no pun intended) from the nuclear-like blast that tore through an industrial complex at the Chinese port of Tianjin last month served to remind the world of how far-reaching and unpredictable the consequences can be when disaster strikes at a site that houses potentially toxic materials. Well, don’t look now but experts now say the No. 2 reactor at Fukushima may have suffered a complete meltdown.
Submitted by Tyler Durden on 09/28/2015 - 19:10 After a 90-minute meeting, Presidents Obama and Putin emerge from the mudslinging apparently agreeing to disagree on everything. Putin blames US - specifically Obama - for "relations being so bad," adding trhat sanctions are not an "efficient" policy tool, and hopes US can play an active role in fighting ISIS with cooperation. Given the image below, we can only imagine how tense the meeting was...
Submitted by Tyler Durden on 09/28/2015 - 18:44 Since the 2008 crash there has been much talk about how the fundamentals have not been dealt with and the fact that the can has only been kicked down the road. Political mavericks and commentators such as Ron Paul have frequently pointed out that nothing has really changed and that we are heading for even bigger disasters ahead if we continue to play ostrich... The truth is that we never left the economic downturn – we are currently in a period of manipulation that’s sole purpose is to mask the fact that there has not been a boom (or recovery if you like) to trigger the next bust.
Submitted by Tyler Durden on 09/28/2015 - 18:33
Submitted by Tyler Durden on 09/28/2015 - 18:15 No, it's not New York, or London; Moscow, Geneva, Vancouver or even D.C. According to Clarmond House, the most important foreign city - the one which China is making the center of its largest offshore infrastructure project - is the tiny port of Gwadar (population 85,000) which Pakistan purchased from Oman in 1958 for $1 million, and which has become the critical hub of China's future energy policy.
Submitted by Tyler Durden on 09/28/2015 - 17:50 "Did Charlie Rose look like a f##king idiot last night on 60-Minutes, or what...?"
Submitted by Tyler Durden on 09/28/2015 - 17:25 IPOs have underperformed the S&P 500 by a stunning 17% year-to-date, extending losses today to 26% year-to-date. With private valuations still sky high in the minds of their VC 'guru' investors, we suspect the fact that this year is now the worst year for IPOs since 2008 will begin to raise doubts about even the most unicorn-y opportunity.
Submitted by Tyler Durden on 09/28/2015 - 17:00 What has always separated successful professional gamblers from the "weekend sucker" is knowing when to step away from the table.
Charlie Rose sat down with Putin to discuss, among other issues, how the world views the Russian leader. CBS has published a preview of the interview.
Rose pointed out that some people have been referring to Putin as a ‘tsar.’ Putin responded that people call him various names, but added he believes the description “does not fit me.”
It’s not important how I’m called, whether these are well-wishers, friends or political opponents. It’s important what you think about you, what you must do for the interest of the country which has entrusted you with the position as the head of the Russian state.When asked what he admires about America, Putin said that what he likes most is “the creativity.”
In SKU Vlog 009, we discuss, in 8 minutes, why so many of us are struggling so severely to make ends meet today.
As a general rule, the most successful man in life is the man who has the best information
From its headquarters at York Factory on Hudson Bay, the Hudson’s Bay Company (HBC) controlled the fur trade throughout much of North America for several centuries.
Gold discoveries were not reported – it was good policy (as we shall see), on the part of Hudson’s Bay, and other fur companies, not to talk about gold because protection of the fur trade was their overriding corporate interest.
In the early 2000s, I began to advise friends and associates that much of the world would likely be entering a depression before the decade was out. In my belief, it would happen in stages, first with an initial mini-crash and recovery, but that, at some point, several years later, the recovery would prove to be a false one. The economy would remain in the doldrums. Then, a far bigger crash would take place and the world would be in a full-blown depression. As a hedge, I recommended that they buy gold, as gold would survive and retain value, as stocks, bonds, and even currencies went south.
I turned out to be correct on the timing of the initial crashes, but entirely incorrecton the timing of the second, greater crash.