Bill Holter: A Global Credit Crises is Rapidly Approaching

Bill Holter of JSMineset discusses the financial crises that continues to unfold behind the scenes. He states that credit crises will erupt and soon. Is he correct is 2018 the year it all comes apart?

- Source X22 Report

Thundering Collision Coming in Bond Market

Former Reagan White House Budget Director David Stockman says, “The central banks realize they cannot keep printing money at these crazy rates, and by that I mean the bond buying. Now, they are going to begin to normalize and shrink their balance sheet. 

By the fall (of 2018), they (the Federal Reserve) will be shrinking their balance sheet by $600 billion a year. What that means in plain simple English is that they (the Fed) are dumping $600 billion a year of existing bonds into the market just as Uncle Sam will be attempting to borrow $1.25 trillion more. 

Now, if you don’t think that is a financial collision waiting to happen, then I am not sure what would be. We are heading for a thundering collision in the bond market that will drive yields upward far more than the market is expecting. The stock market operates on the illusion of permanently low interest rates. When interest rates start to rise, everything is going to come apart because cheap debt has been priced in forever, and we are heading for far more expensive debt. 

Bond prices are going to collapse when yields begin to rise. Stock prices are going to collapse bigtime when the underlying predicate of cheap debt, massive stock buy backs and M&A deals and everything else supporting the market today finally reverses. 

So, we are going to have deflation in the canyons of Wall Street, and that will not be a happy day.” 

Stockman also likes gold and silver and says those are only "safe investments left."

- Source, USA Watchdog

Martin Armstrong: We Are in the Biggest Bond Bubble in History

Is renowned financial expert Martin Armstrong worried about central banks continually buying bonds to suppress interest rates? Armstrong says, “Yes, absolutely. We are in the biggest bond bubble in history, not a stock bubble, but a bubble. 

The scary thing in Europe is the ECB (European Central Bank) has been basically supporting the governments. It is subsidizing all the governments in the Eurozone. 

We are looking at almost 10 years of quantitative easing with that, and it hasn’t helped the economy. If the ECB backs off, who’s going to buy the debt?” How does this end? Armstrong says, “Our computers are showing that interest rates are going to go up faster than anybody has ever seen in history. 

You are looking at a doubling of interest rates very, very rapidly. Gold and equities are the place to be.”

- Source, USA Watchdog

A Cascading and Collapsing Collateral Crisis

Gordon Long discusses the shenanigans of central bankers and how outrageous it really is. This a must listen and watch to understand whats happening.

- Source, Gordon T Long

Tillerson is Ready For North Korea Talks... But Is Trump?

Secretary of State Rex Tillerson told an audience this week that the US was ready to begin direct talks with North Korea without pre-conditions. But the White House has denied that the Administration's position has changed. Is Tillerson free lancing it? Or is something else going on?

- Source, Ron Paul

Robert Shiller: People Are Moving Into a State of Extreme Fear

(Please click Image, or HERE to play this video)

Robert Shiller, professor of economics at Yale University, discusses growth versus value and volatility in equities. He speaks with Guy Johnson on "Bloomberg Surveillance."

- Source, Bloomberg

Catherine Austin Fitts: Smart Money Buying Gold and Land

Catherine Austin Fitts, who was also an Assistant Housing Secretary in the first Bush Administration, talks about the Mueller/Trump investigation that she says is twisting in the wind and also the gun control and why Americans need firearms now more than ever. Fitts also says a large market correction will probably happen in 2018.

- Source, USA Watchdog

The Time to Buy Commodities is NOW

DoubleLine CEO Jeffrey Gundlach said Tuesday that historical and economic indicators point to a likely buying opportunity for commodities such as oil and gold.

"If you ever thought about buying commodities, ... maybe you should buy them now," Gundlach said in a webcast organized by his firm.

He pointed out that by comparing total returns of the S&P Goldman Sachs Commodity Index with the S&P 500 over the last several decades, there are clearly defined points at which commodities outperformed stocks, leading to a sharp increase in stocks, and vice versa. For example, stocks far outpaced commodities during the dotcom bubble of the late 1990s into 2000. But commodities went on to rally hard until they peaked during the global financial crisis of 2008.

"We're right at that level where in the past you would have wanted commodities instead of stocks," Gundlach said, noting that commodity prices stopped falling in 2016 and the global economy is "definitely hanging in there." He said he does not see a recession likely for at least the next six months.

The S&P GSCI is up nearly 56 percent from its low in January 2016 after plunging more than 30 percent in 2015. The index is up just over 6 percent this year, while the S&P 500 has rallied more than 17 percent.

Gundlach also expects the U.S. dollar index's next major move will be lower as the Federal Reserve is unable to tighten monetary policy as much as they plan. A weaker dollar also helps commodity prices and emerging market assets, which Gundlach said he still likes.

In a response to a question about whether having 10 percent of a portfolio in gold is "too much," Gundlach said he would rather put 10 to 15 percent of his investments in commodities broadly rather than gold alone.

The investor also said the falling yield curve between the 2-year and 10-year Treasury yield is "getting to the point where it's worth watching." That fact that "people are starting to explain away the yield curve" indicates to him the U.S. economy is closer to the middle of the tightening cycle than the beginning.

"It's pretty relentlessly flattening," Gundlach said. "If the [yield curve] goes to zero then we get a flashing yellow light for [a] recession."

DoubleLine's $54 billion Total Return Bond Fund is up 3.6 percent year to date, according to Morningstar.

This summer, Gundlach put a big bet on the return of volatility to the market, predicting the Standard & Poor's 500 would tumble. He bought a bunch of put options on the index, a bet that it would fall and a move he described as a bullish bet on volatility. In August, Gundlach predicted the VIX would double to 20.

Just the opposite has happened for most of this year. The S&P has climbed while volatility as tracked by the CBOE's Volatility Index, or VIX, is down 20 percent. Only recently has Gundlach's bet been in a position to benefit. The VIX is up 21 percent this month and 16 percent so far this quarter.

Gundlach said on Tuesday's webcast that since the VIX jumped from below 10 to above 17 a few days after his August forecast, "I'm going to call it good enough."

- Source, CNBC

Jim Rickards: Gold Is Now Fully Priced For A FED Rate Hike

Inflation Can Return Much Faster Than You Think

Consumer price inflation has remained persistently low, despite the Fed’s best efforts. This has led many people to ask where the inflation is, because the Fed has created trillions of dollars since the financial crisis.

But there has been inflation. It’s just been in assets like stocks, bonds, real estate, etc. How about bitcoin? Bitcoin increased about $2,000 yesterday alone! It’s trading at about $16,000 as I write. We’ve never seen anything like it.

The bottom line is, we’ve seen asset price inflation, and lots of it, too.

But the question everyone wants to know is when will we finally see consumer price inflation; when will all that money creation catch up at the grocery store and the gas pump?

It’s difficult to say exactly. But once it does happen, it will likely strike with a vengeance. Double-digit inflation could quickly follow.

Double-digit inflation is a non-linear development. What I mean by that is, inflation doesn’t go simply from two percent, three percent, four, five, six. What happens is it’s really hard to get it from two to three, which is ultimately what the Fed wants.

It’s proving extremely difficult just to get up to two. Personal consumption expenditures (PCE) is the core price deflator, which is what the fed looks at. Currently, it is at about 1.4%, but it’s stuck there. It’s not going anywhere. The Fed continues to try everything possible to get it to two with hopes to hit three.

The reason is that it’s not purely a function of monetary policy, it’s a partial function of monetary policy.

It’s also a partial function of behavioral psychology. It’s very difficult to get people to change their expectations, but if you do, it’s hard to get them to change back again.

Inflation can really spin out of control very quickly. So is double-digit inflation rate within the next five years in the future? It’s possible. Though I am not forecasting it. If it happens, it would happen very quickly. We would see a struggle from two to three, and then jump to six, and then jump to nine or ten.

This is another reason why having a gold allocation now is of value. Because if and when these types of development begin happening, gold will be inaccessible.

To this point, I am often approached on, “How can you say gold prices will rise to $10,000 without knowing developments in the world economy, or even what actions will be taken by the federal reserve?”

It’s not made up. I don’t throw it out there to get headlines, et cetera. It’s the implied non-deflationary price of gold. Everyone says you can’t have a gold standard, because there’s not enough gold. There’s always enough gold, you just have to get the price right.

That was the mistake made by Churchill in 1925. The world is not going to repeat that mistake. I’m not saying that we will have a gold standard. I’m saying if you have anything like a gold standard, it will be critical to get the price right. To this regard, Paul Volcker said the same thing.

The analytical question is, you can have a gold standard if you get the price right; what is the non-deflationary price? What price would gold have to be in order to support global trade and commerce, and bank balance sheets, without reducing the money supply? The answer is, $10,000 an ounce.

The math is where I use M1, based on my judgment. You can pick another measure if you choose (there are different measures of money supply). I use 40%. A lot of people don’t agree with that. The Austrians say it’s got to be 100%.

Historically, it’s been as low as 20% so 40% is my number. If you take the global M1 of the major economies, times 40%and divide that by the amount of official gold in the world, the answer is approximately $10,000 an ounce.

Now, if you go to 100%, you’re going to get, using M1, you’re going to get $25,000 an ounce. If you use M2 at 100% you’re going to get $50,000 an ounce. If you use 20% backing with M1, you’re going to get $5,000 an ounce.

All those numbers are going to be different based on the inputs, but just to state my inputs, I’m using global major economy M1, 40% backing, and official gold supply of about 35,000 tons.

Change the input, you’ll change the output, but there’s no mystery. It’s not a made-up number. The math is eighth grade math, it’s not calculus.

That’s where I get the $10,000 figure. It is also worth noting that you don’t have to have a gold standard, but if you do, this will be the price.

The now impending question is, are we going to have a gold standard? That’s a function of collapse of confidence in central bank money, which is already being seen. It’s happened three times before, in 1914, 1939 and 1971.

Let us not forget that in 1977, the United States issued treasury bonds denominated in Swiss francs, because no other country wanted dollars. The United States Treasury then borrowed in Swiss francs, because people didn’t want dollars, at least at an interest rate that the Treasury was willing to pay.

That’s how bad things were, and this type of crisis happens every 30 or 40 years. Again, we can look to history and see what happened in 1998. Wall Street bailed out a hedge fund to save the world. What happened in 2008? The central banks bailed out Wall Street to save the world.

What’s going to happen in 2018?

Each bailout gets bigger than the one before. But the Fed is not in a position to handle another crisis with its traditional tools. It’s currently very low on“bullets.”

The Fed has been raising interest rates not because they’ve been justified by the economic data, but because it’s out of bullets and needs to raise rates so it can lower them again in event of another recession.

And despite the recent hikes, rates remain very low. If the next crisis is bigger than the last one, which I expect, the Fed is basically tapped out.

Of course, raising rates could cause the very recession the Fed’s trying to prevent. But that’s why it’s raising rates.

What about next week? Will Janet Yellen raise rates?

A potential government shutdown looms this weekend. It’s difficult to imagine the Fed hiking rates on December 13 if the government shuts down on December 8 and remains shut on the date of the FOMC meeting.

There’s not much middle ground between Democrats and Republicans on spending policy issues like immigration, Trump’s Wall, Obamacare bailouts, and a host of other hot button issues.

This looks like another 50/50 call.

The euro, yen, gold and Treasury notes are all fully priced for rate hike. If it happens, those instruments won’t change much because the event is priced. If there’s no rate hike, euros, gold, yen and Treasury notes will all soar.

So, there’s an asymmetry in the probable outcomes. If you go long euros, gold, yen and Treasury notes, you won’t lose much if the Fed hikes (assuming no geopolitical shocks), but you could win big if they don’t.

That’s the kind of coin toss I like. Heads I win, tails I don’t lose.

- Source, Jim Rickards via the Daily Reckoning

Ann Barnhardt: You Are Now Obsolete, The Elites Don't Need You

Have you suffered the disturbing experience of being treated by the system as though you are an unneeded nuisance? And rather than serving your needs, the system is dumping you as though it could go on just fine without you? 

Are you being displaced from one or many of your natural roles (Father / Mother / Employee / Investor / Patient / Customer / Citizen) and disenfranchised of your intrinsic rights? Ann Barnhardt, founder of Barnhardt Capital Management and a firebrand for justice, returns to Reluctant Preppers to examine two recent news stories that starkly exemplify the surreal inversion that is being perpetrated on ordinary people today. 

Don't miss Barnhardt's rousing call for principled individuals to reclaim our natural rights and our lives!

- Source, Reluctant Preppers

Catherine Austin Fitts: We Need Our $40 Trillion In Stolen Cash Back

Don’t expect the mainstream propaganda media to give you any warning or real information about what’s happening. Financial Expert Catherine Austin Fitts contends, “The conundrum for a CNN is how do we get ratings? How do we get attention without talking about the real news? 

The real news is, since fiscal 1995, we have disappeared or bailed out or stolen over $40 trillion of our money. If we are going to balance the budget, we need that $40 trillion or the assets thereon or the liabilities of the people who stole it back on the table, or else we’re toast. If we can give $27 trillion to the banks, I can assure you we can afford $4 trillion of a pension fund bailout. Mr. Global doesn’t want us to do the algebra. 

This is like fourth grade math. $27 trillion to bail out the banks, and we are not going to bail out the pension funds? Where does that come from?”

- Source, USA Watchdog

The Growing Debt Bomb: $21 Trillion Missing from US Federal Budget

Dr. Mark Skidmore thinks the federal accounting of $21 trillion in missing money is crazy and far outside the realm of normal. So, is this a legitimate U.S. national security issue? Dr. Skidmore, who holds a PhD in Economics, says, “Yeah, and that is one of the reasons I decided to look at this. 

How can this be, and what does this mean? If trillions of dollars are flowing in and flowing out, it appears to be outside of our Constitution and outside of the rule of law. If that is the case, that really is troubling because it suggests that there is a layer of things happening that are outside the rule of law. 

I know, for example, that some activities, just for the sake of protection of the people involved in national security, have to be black budget. There is always stuff like that. Usually, it’s authorized spending, and some percentage is this black budget where only a small percentage of people and some in Congress know about it, but this is way outside of that. So, I am worried about it.”

- Source, USA Watchdog

Paul Craig Roberts: The Markets Will Fall When The Dollar Falls

The biggest danger to Dr. Roberts, who has a PhD in economics, is the U.S. dollar. Dr. Roberts contends, “It seems to me that the only thing that would cause the Federal Reserve to stop the liquidity would be if the U.S. dollar fell under attack. 

If for some reason people said, hey, we don’t want the dollar anymore, and they started moving out of dollars into other currencies or into something else, if they cease to hold assets in dollars, if that happened, the Fed would have to try to raise interest rates to support the dollar. 

Then you could see that everything could come apart. If the interest rates would go up, there would be all kinds of derivatives that would not be sustainable. The stock market would collapse. It would be a mess. It would be an utter mess. That’s what the IMF is worried about. It’s a messy situation. How do you get out of it?”

- Source, USA Watchdog

It's About To Get Alot Worse For Retail, The Economy Will Decline Rapidly In 2018

US debt is rising very quickly, auto, student and credit card debt overtook mortgages. The Fed's most watched indicator for inflation is starting to tick up. US retail companies are very worried about 2018, we are going to see a lot more stores close down because when the holiday season is a bust they will not be able to pay for the debt that is coming due. Global equities have been rising for 13 consecutive months in a row, even with the printing of currency, hmmm.

- Source, X22 Report