BIGGER #RATE #HIKES NEEDED TO KEEP #INFLATION UNDER WRAPS

 CNN NEWS

Inflation is so hot the Fed may have to hike interest rates like it’s 1994

By Matt Egan, CNN Business

Inflation is so hot that Wall Street banks are falling over each other to predict the dramatic moves the Federal Reserve will have to make to cool prices off.

Goldman Sachs raised eyebrows earlier this week by forecasting the Fed will raise interest rates by a half a percentage point in each of the next two meetings.

Morgan Stanley and Jefferies quickly endorsed that view, even though the Fed hasn’t done a rate hike of that size at a single meeting since 2000.

Now, Citigroup is upping the ante. Citi economists said Friday they expect the Fed will boost interest rates by a half a percentage point during each of the next four meetings. And Citi left the door open for even more aggressive steps, such as big rate hikes at every remaining meeting this year.

The aggressive call underscores the level of concern about the inflation outlook, which has darkened considerably in recent weeks because of Russia’s invasion of Ukraine and the ensuing spike in food, energy and other commodity prices.

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LOOKOUT HERE COMES THE BIG ONE

Brazil Poster Child For Economic Collapse, & More Insights

As a Boom Fades, Brazilians Wonder How It All Went Wrong

BRASÍLIA — The president of Brazil should have been ecstatic. She had just won re-election after an intense campaign in which she fiercely defended her role in making Brazil, for a few fleeting years, a rising star on the global stage.

But in the days after her victory last October, President Dilma Rousseff was worried, confronted in private deliberations with her closest advisers by signs that Brazil’s triumphs were at risk of coming undone.

“We went too far,” Aloízio Mercadante, Ms. Rousseff’s chief of staff, acknowledged publicly this month, describing the sense of alarm as the dust settled after the election and Ms. Rousseff and her aides grappled with the weaknesses in Brazil’s economy.

A rare interview with the mathematician who cracked Wall Street 

Jim Simons was a mathematician and cryptographer who realized: the complex math he used to break codes could help explain patterns in the world of finance. Billions later, he’s working to support the next generation of math teachers and scholars. TED’s Chris Anderson sits down with Simons to talk about his extraordinary life in numbers.

Honda to test self-driving cars, manufacturers pledge auto-braking for the masses 

The AP reports that some driver advocates like the Center for Auto Safety were concerned that this pledge doesn’t do enough to get automatic breaking systems into cars. Those advocates would rather the government legally require cars to have automatic breaking systems, instead of rely on a voluntary promise to keep drivers safe. Another concern is that automatic braking systems are generally sold as add-ons to luxury vehicles, which would put them out of reach of most consumers

Big banks in $1.865 billion swaps price-fixing settlement 

Credit default swaps are contracts that let investors buy protection to hedge against the risk that corporate or sovereign debt issuers will not meet their payment obligations.

The market peaked at $58 trillion in 2007, according to the Bank for International Settlements, but shrank to $16 trillion seven years later as investors better understood its risks

Sovereign Debt for Territory: A new Global Elite Swap Strategy 

One often wonders why governments indebt themselves for so much more than they can ever hope to pay… Here, Western economists, bankers, traders, Ivy League academics and professors, Nobel laureates and the mainstream media have a quick and monolithic reply: because all nations need “investment and investors” if they wish to build highways, power plants, schools, airports, hospitals, raise armies, service infrastructures and a long list of et ceteras, economic and national activities are all about.

The Real Cost of Filling Up: Gasoline prices by country 

This ranking sorts 61 countries by price, earnings needed to buy a gallon, and annual income spent on fuel.

Why The Fed Would Be Insane To 

Raise Rates: The Rising U.S. Dollar

The USD strengthening since last July is the core driver of the global recession.

The parlor game of the moment is laying odds on the Federal Reserve's decision to raise rates, leave rates unchanged, or (gasp!) hint at future stimulus. There are certainly a multitude of inputs to the Fed's decision, and a variety of potential consequences, but only one really matters: the effect on foreign exchange/currency markets.

It's not that difficult to understand the one dynamic that matters. If the Fed raise yields/interest rates in the U.S., that makes the U.S. currency, i.e. the U.S. dollar (USD), more attractive.

Higher yield = more attractive, especially when coupled with the liquid market for U.S. Treasuries and the relative safety of the dollar vis a vis other currencies issued by falling-into-recession nations and trading blocs.

A Passing Thought...

Expect Increasing Lies As Global Economy Collapses, & More Insights

Investors' Insights Comments

Any serious investor who believes that the CPI numbers (etc.) created by governments everywhere are real and accurate is the sort of bigger fool everyone is looking for - to support  many ventures. Now, sooner or later, the markets are going to wake up to  this reality,inclusive of  China, to Greece to Brazil and  the USA, plus many more - and then watch the proverbial "you-know-what ' hit the fan.

In turn, the spin doctors and other Pinocchios will be fully employed in very secure long-term activities as they seek to baffle the feeble-minded towards ratification and consumption. So yes, Eric Sprott is right.- so Is Noam Chomsky; so was John Steinbeck..

Never forget Arthur Anderson, Enron , China, the Fed, and all the rest. For as always, remember this utter wisdom -  figures lie, only because liars figure. 

Beware, and good luck!

August 31, 2015

Lies You Will Hear As The

 Economic Collapse 

Progresses

It is undeniable; the final collapse triggers are upon us, triggers alternative economists have been warning about since the initial implosion of 2008. In the years since the derivatives disaster, there has been no end to the absurd and ludicrous propaganda coming out of mainstream financial outlets and as the situation in markets becomes worse, the propaganda will only increase. This might seem counter-intuitive to many. You would think that the more obvious the economic collapse becomes, the more alternative analysts will be vindicated and the more awake and aware the average person will be. Not necessarily...

 

In fact, the mainstream spin machine is going into high speed the more negative data is exposed and absorbed into the markets. If you know your history, then you know that this is a common tactic by the establishment elite to string the public along with false hopes so that they do not prepare or take alternative measures while the system crumbles around their ears. At the onset of the Great Depression the same strategies were used. Consider if you've heard similar quotes to these in the mainstream news over the past couple months:

Optimistic About Inflation, Stanley 

Fischer Suggests

 That Fed Will Stick to Plan on Rates

The Fed’s preferred measure of inflation shows that prices rose 0.3 percent during the 12 months ending in July, well below the 2 percent annual pace the Fed considers healthy. A narrower measure excluding food and oil prices, which the Fed regards as more predictive, increased 1.2 percent over that same period.

Printing Money Goes Haywire in Venezuela 

Venezuela seems to be hovering on the edge of tipping into hyperinflation. Or perhaps it has already fallen into the abyss. Given the paucity of official data -- the none-too-believable official figures were last published in February -- it's a little hard to tell.

China Construction Bank Posts Zero Profit Growth on Weak Economy 

Industrial overcapacity, a build-up of corporate debt and a $5 trillion stock-market slump are making it harder for Premier Li Keqiang to prevent a deeper economic slowdown. The combined earnings of China’s five biggest banks are projected to rise 2 percent this year, the least since at least 2004, according to analysts’ estimates compiled by Bloomberg.

The Coddling of the American Mind 

There’s a saying common in education circles: Don’t teach students what to think; teach them how to think. The idea goes back at least as far as Socrates. Today, what we call the Socratic method is a way of teaching that fosters critical thinking, in part by encouraging students to question their own unexamined beliefs, as well as the received wisdom of those around them. Such questioning sometimes leads to discomfort, and even to anger, on the way to understanding.

Bond Market Explosion Not Stoppable: Craig Hemke 

What I really worry about is that transition from one financial scheme to the next is never done peacefully. The hegemon that has the printing press, that has the reserve currency, they don’t just sit back and say we’ve had our time in the sun. Now it’s your turn. No, they fight as hard as they can to protect and defend that. That’s my biggest concern.

Eric Sprott Was Right,

 Inflation Is Rising

Eric showed the above table in his presentation. It shows that the true level of inflation, a persistent increase in prices, has been sitting around 10% since 2011. Indeed, a far worse picture than what the US Federal Reserve paints. The Fed argues that prices have been rising below 2% for the past four years. That said, the Fed doesn’t include food, petrol and taxes in its inflation index. This is similar to the Reserve Bank of Australia’s inflation calculation.

But then who needs petrol and food, right?

So it’s not surprising that Jim Rickard’s, over at Strategic Intelligence, argues that there’s no worse forecaster in the world than the US Fed.

You may have noticed each year that Australian healthcare companies raise their premiums by roughly 6%. Well, costs are also rising over in the US.

I’ve been speaking to many US citizens up here at the conference. The word on the street is that Obamacare is one of the worst policies of all time. It’s legally forced those who can’t afford health care to buy; at the same time, hiking insurance premiums for those who require modest healthcare.

And it’s only going to get worse…

A Passing Thought...

The BIG Game Changer - "GLASS- STEAGALL II " & More Top Insights

Senators Re-introduce Bill With Glass-Steagall Protections

Sens. Elizabeth Warren (D-Mass.), John McCain (R-Ariz.), Maria Cantwell (D-Wash.) and Angus King (I-Maine) have re-introduced what they call the “21^st Century Glass-Steagall Act,” a bill that would reintroduce the separation between commercial and investment banking.

The bill is aimed at “reduc[ing] risks to the financial system by limiting banks’ ability to engage in certain risky activities and limiting conflicts of interest, to reinstate certain Glass-Steagall Act protections that were repealed by the Gramm-Leach-Bliley Act, and for other purposes.”

The bill would prohibit institutions insured by the Federal Deposit Insurance Corp. (FDIC) from being or becoming affiliated with, or having a common ownership or control with, any insurance company, securities entity or swaps entity. The institutions would also be prohibited from engaging in any activity that would cause it to qualify as an insurance company, securities entity or swaps entity.

Individuals who are officers, directors, partners or employees of any insurance company, securities entity or swaps entity would be prohibited from simultaneously serving as officers, directors, employee or any other institutions-affiliated party of any insured depository institution.

Jim Rogers Russia, China, Brazil Sign Deal To Bypass US Dollar?

Russia has little debt, ample resources and its currency freely floats and he speculates at some point a challenge to the US dollar will take place, he says

Jim Rogers thinks the US is a “flawed currency” that should be replaced and he thinks the BRICs nations can do it, minus India. Jim Rogers: Brazil wants to compete with the US dollar

Discussing the recent BRICs conference, Jim Rogers noted the steady drumbeat to displace the US as the world’s reserve currency of choice. “Brazil wants to compete with the IMF, the World Bank and the US dollar,” as do all participants in the BRICs conference, Rogers said when speaking on an RT interview.

“Brazil, China and Russia could easily put something together to compete with the US dollar,” Rogers said, leaving out one component of the BRICs alliance. “The US dollar is a terribly flawed currency. I’m an American. I hate to say that. But the US has serious problems, the world has serious problems. We need something else” and potentially a competing world currency could be developed. If this were to occur, the US and its economy might be put in a straight jacket as the ability to engage in large deficit spending could be curtailed. Jim Rogers: BRICs developing an alternative banking system

To put together a competing world reserve currency and develop an alternative banking system, the BRICs might consider throwing India out of the equation, Jim Rogers said. India has been said to be the stumbling block in establishing the new world bank. “India and Brazil have big (national) debts. Russia is not a big debtor and has big international reserves,” Rogers noted, pivoting to Russian advantages in the interview. “Russia has a freely convertible currency and none of the others have a freely convertible currency.” 

Jim Rogers thinks Russia should spend its time courting suitors in its own neighborhood, however. “If I were Russia I would be more interested in selling to Asia than South America.”

As reported two days ago in ValueWalk, the leaders of

Russia, India, Brazil, China and South Africa are in meetings 

ending July 17 to bring together plans to create a $100 billion

 bank to compete with the World Bank and International 

Monetary Fund. The planed bank is a piece in a larger puzzle

 to provide a global alternative to Western dominance of the 

financial system. This has been a stated goal of Russia and

 China, both of whom have engaged in trade deals that

 eschew the use of the US dollar.markets 

Jim Rogers started trading the stock market with $600 in 1968.In 1973 he formed the Quantum Fund with the legendary investor George Soros before retiring, a multi millionaire at the age of 37. Rogers and Soros helped steer the fund to a miraculous 4,200% return over the 10 year span of the fund while the S&P 500 returned just 47%. 

Doomsday clock for global market crash strikes one

 minute to midnight as central banks lose control 

8 - Overvalued US market In the US, Professor Robert Shiller’s cyclically adjusted price earnings ratio – or Shiller CAPE – for the S&P 500 stands at 27.2, some 64pc above its historic average of 16.6. On only three occasions since 1882 has it been higher – in 1929, 2000 and 2007.

A September To Remember?

In terms of overnight action, China’s equity market eked out a positive gain amid a stabilizing yuan, further aided by the Chinese market regulator essentially inferring it would prop up the equity market for years to come. I wonder what we’ll think in 30 years’ time when we look back at the market intervention we have seen across the globe in the last half a decade or so. Hum dee dum.

This Week In Energy: The Growing Threat From China 

In the U.S., low oil prices could be exacerbated by an outage at a major U.S. refinery. The Whiting refinery, based in Indiana right outside of Chicago, was taken offline by its owner BP (NYSE: BP) for unplanned repairs. The refinery’s total output is 410,000 barrels per day, and one of the units (with a 240,000 barrel-per-day throughput capacity) could be offline for a month or two.

The Secrets Of Extraordinary Survivors 

Their successes challenge many of our common notions about the resilience of the human mind. While some people understandably crumble after extraordinarily harrowing events, others, like Eugenie have an extraordinary capacity to rebound and survive. Understanding why could lead us to help many more recover and grow after their experiences.

Europe In Crisis:

Everyone from Putin to ordinary savers is stockpiling gold

European investors snapped up gold bars and coins at a rapid pace in the second quarter as turmoil in Greece threatened to push the country out of the eurozone.

The World Gold Council (WGC) said demand in Europe for the precious metal rose sharply in the three months to June compared with the same quarter last year amid rapid buying of bullion, even as global demand fell by 12pc to a six-year low of 915 tonnes.

The increase in Europe was led by Germany, where sales of bars and coins rose 24pc to 24.1 tonnes in the second quarter. Demand in Austria and Switzerland also rose sharply, according to the WGC's quarterly trends report.

Learning Success: 

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