Tag Archives: Money For Nothing

India central bank chief warns of another market crash

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“‘True, it (another financial sector crisis) may not happen if we can find a way to unwind everything steadily,’ Rajan, who is famed for predicting the 2008 markets crash years in advance, said in the interview posted late Wednesday on the journal’s website.  ‘But it is a big hope and prayer,’ said the Reserve Bank of India (RBI) governor, adding there is a risk of sudden price reversals and sharp spikes in financial volatility.  ‘We are back to the 1930s, in a world of ‘competitive easing’,’, Rajan said, referring to ultra-low interest rate policies pursued by the US Federal Reserve, the Bank of Japan and the Bank of England in a bid to stimulate their economies and spur growth.”

http://finance.yahoo.com/news/india-central-bank-chief-warns-another-market-crash-190447924–finance.html

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JPMorgan Joins Goldman in Designing Derivatives for a New Generation

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“Derivatives that helped inflate the 2007 credit bubble are being remade for a new generation.  JPMorgan Chase & Co. is offering a swap contract tied to a speculative-grade loan index that makes it easier for investors to wager on the debt. Goldman Sachs Group Inc. is planning as much as 10 billion euros ($13.4 billion) of structured investments that bundle debt into top-rated securities, while ProShares last week started offering exchange-traded funds backed by credit-default swaps on company debt.  The instruments are springing back to life as investors seek new ways to boost returns that are being suppressed by central bank stimulus.”

http://www.bloomberg.com/news/2014-08-12/swaps-reincarnate-boosting-debt-bets-in-new-era-credit-markets.html

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Marc Faber on Commodity Cycles and the Wealth Redistribution Craze

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“We have a two-tier economy. We have an economy of well-to-do people from which I have benefited because I’m in the financial sector. My asset value has gone up, I benefit from rising asset prices because I own shares and I’m on the board of companies that own shares, fund management companies and so forth, but I’m not happy about the fact that the typical household and the working class worldwide is not doing well. And what will eventually happen and has begun to happen when you have rising wealth inequality, eventually you have politicians that will not assume personal responsibility for the rising wealth inequality that is largely fostered by monetary policies by central banks.”

http://www.thedailybell.com/exclusive-interviews/35527/Anthony-Wile-Marc-Faber-on-Commodity-Cycles-Monopoly-Central-Banking-and-the-Wealth-Redistribution-Craze/

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Bill Bonner: Never Never Land

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“Bill Bonner’s presentation from The Sprott Vancouver Natural Resource Symposium 2014 held July 22nd to 25th, 2014.”

http://www.bonnerandpartners.com/never-never-land/

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The 20 hottest real estate spots in the world

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“It’s safe to say we’re in the midst of a global real estate bull market. According to the Knight Frank Global House Price Index, the value of homes internationally rose by 8.4 percent in 2013, representing the highest annual increase since 1995.  Although it’s a global phenomenon, US buyers — especially New Yorkers — are particularly active abroad.  While much of this money is pouring into established urban centers, experts describe Americans as more entrepreneurial about snapping up property — willing to invest in everything from a private island in Antigua to vast farms in Zambia if the price (and property) is right.”

http://nypost.com/2014/04/08/the-20-hottest-real-estate-spots-in-the-world/

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BIS chief fears fresh Lehman from worldwide debt surge

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“Jaime Caruana, head of the Swiss-based financial watchdog, said investors were ignoring the risk of monetary tightening in their voracious hunt for yield.  Mr Caruana said the international system is in many ways more fragile than it was in the build-up to the Lehman crisis. Debt ratios in the developed economies have risen by 20 percentage points to 275pc of GDP since then. Credit spreads have fallen to to wafer-thin levels. Companies are borrowing heavily to buy back their own shares. The BIS said 40pc of syndicated loans are to sub-investment grade borrowers, a higher ratio than in 2007, with ever fewer protection covenants for creditors.”

http://www.telegraph.co.uk/finance/markets/10965052/Bank-for-International-Settlements-fears-fresh-Lehman-crisis-from-worldwide-debt-surge.html

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Seth Klarman On “Born Bulls”, Bitcoin, & “The Truman Show” Market

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“Robert Schiller’s cyclically adjusted P/E valuation is over 25, a level exceeded only three times before – prior to the 1929, 2000 and 2007 market crashes.  Even with the ranks of the unemployed and underemployed still bloated and the economy barely improved from a year ago, the S&P 500, Dow Jones Industrial Average, and Russell 2000 regularly posted new record highs.  Our assessment is that the Fed’s continuing stimulus and suppression of volatility has triggered a resurgence of speculative froth. Margin debt measured as a percentage of GDP recently neared an all-time high. IPO activity in 2013 was greater than it has been in years, approaching 2007’s record of 288 transactions.”

http://www.zerohedge.com/news/2014-03-08/seth-klarman-born-bulls-bitcoin-truman-show-market

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Peter Schiff and Doug Casey on the Real State of the Economy

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“The president is bragging now that the deficit is finally below $1 trillion, but that’s the deficit in the recovery. If we slip into a legitimate or acknowledged recession, where are the deficits going to go, $1.5 trillion, $2 trillion? And how can we possibly finance that when the world is already saturated with the debt that we’ve issued to stimulate us out of prior recessions?  [..]  I think we are on the edge of something that is much worse than what we had in 2008 and 2009. I look around the world at places where you can put your capital, real estate is overpriced, the stock market is greatly overpriced, the bond market is in a historic bubble, that’s about the best short sale I can think of in the world.”

http://www.internationalman.com/articles/peter-schiff-and-doug-casey-on-the-real-state-of-the-economy

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Why the Fed’s Taper Hasn’t Hurt the Stock Market… Yet

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“Normally, monetary tightening produces undesirable effects. But none of those effects has shown up yet. Stocks continue to rise. Long-term interest rates remain ultra-low. The unemployment rate is improving. And inflation—at least as the government reports it—is rising only modestly.  Naturally, the question is: how has the Fed managed to taper without roiling markets?  The answer: the Fed has printed so much money in the past few years that it can afford to take a breather. Since 2013, the Fed has been growing its balance sheet (by buying Treasuries and mortgage-backed securities) faster than the government debt has grown.”

http://www.caseyresearch.com/cdd/why-the-feds-taper-hasnt-hurt-the-stock-market-yet

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The Logical Conclusion of the Modern, Monetary Argument

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“One of the most terrible things about the globalization of finance, money and industry is that it homogenizes booms and busts. There is literally nowhere to go. As economic centralization continues, these cycles will only worsen. These days in the West – and certainly in Washington – Republicans are sure they can mandate a technocratic interest-rate rule that will restrain the Fed from doing inordinate damage to the economy. Ironically, Democrats argue for more flexibility and less government interference regarding money. This would be admirable from a free-market standpoint except that they are arguing on behalf of a MONOPOLY facility. As usual, both parties get it wrong.”

http://www.thedailybell.com/news-analysis/35494/The-Logical-Conclusion-of-the-Modern-Monetary-Argument/

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