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Deutsche Bank Profit Plunges 98 Percent As The Outlook For ‘The World’s Riskiest Bank’ Darkens

Crash Arrow Down - Public DomainThe biggest and most important bank in the biggest and most important country in Europe continues to implode right in front of our eyes.  If you follow my work regularly, you probably already know that I issued a major alarm about Deutsche Bank last September.  Subsequently, Deutsche Bank stock hit an all-time low.  Then I sounded the alarm about Deutsche Bank again back in May, and once again that was followed by another all-time low for Deutsche Bank.  And then I warned about Deutsche Bank again in early June, and you can probably imagine what happened after that.  Over the past year, this German banking giant has literally been coming apart at the seams, and in so many ways it is paralleling exactly what happened to Lehman Brothers back in 2008.

Today, we got some more bad news from Deutsche Bank.  Compared to the exact same period last year, profits were down 98 percent.  A nearly 100 percent drop in net income spooked a lot of investors, and Deutsche Bank shares got hit hard on Wednesday.  Of course Deutsche Bank shares are already down by more than half over the past 12 months, and the financial sharks can smell blood in the water.

Just like Lehman Brothers in 2008, Deutsche Bank is essentially in panic mode at this point.  They recently announced that they will be closing 188 branches and that 3,000 workers will be losing their jobs.  But this could just be the beginning of the layoffs at the bank.  According to some reports, the bank could cut up to  35,000 jobs by the year 2020, and CEO John Cryan recently admitted that they “may have to accelerate cost-cutting measures“.

What makes all of this even more alarming is that Deutsche Bank is widely considered to be “the most dangerous bank” on the entire planet.  The following comes from a CNN article posted just today entitled “The world’s riskiest bank is in trouble“…

What is going on with Deutsche Bank?

Germany’s biggest lender was dubbed the world’s riskiest bank by the International Monetary Fund last month, just as one of its U.S. businesses failed a Federal Reserve stress test.

Its shares are down 45% this year, and on Wednesday it said second quarter profits were wiped out by a 98% slump in earnings. The stock fell 2.5% in Frankfurt.

The primary reason why Deutsche Bank is “the world’s riskiest bank” is because of the mammoth derivatives portfolio that is possesses.  It currently has 42 trillion euros of exposure to derivatives, which is an amount of money about 13 times the size of the entire German economy.

When Deutsche Bank finally goes down for good, it is going to be “the shot heard around the financial world”, and it will be a disaster many times greater than the collapse of Lehman Brothers in 2008.  Just consider what Jeff Gundlach had to say about the bank earlier this year

“Banks are dying and policymakers don’t know what to do,” Gundlach said. “Watch Deutsche Bank shares go to single digits and people will start to panic… you’ll see someone say, ‘Someone is going to have to do something.'”

As I write this, shares of Deutsche Bank are sitting at just $13.63, and many experts are having a very difficult time finding any reason for optimism.  In fact, Edward Misrahi has stated that the bank is his number one short trade, and Jim Collins says that “it is just impossible” to recommend buying shares of Deutsche Bank even at this depressed level…

As an equity analyst, it is just impossible to recommend shares of a bank that is not growing revenue. So really, Deutsche is an untouchable, and the stock market is trying — to the tune of a 58% decline in DB’s market value in 12 months — to recalibrate Deutsche’s market capitalization to the true value of its assets net of liabilities. That’s a painful journey.

I don’t mean to just pick on Deutsche Bank.  Certainly there are a lot of other major banks around the globe that are also teetering on the brink right now.  Just take a look at Italy.  Basically their entire banking system is in the process of melting down.

But the utter collapse of Italy’s banking system won’t have the same kind of worldwide impact that the collapse of Deutsche Bank will.

Unlike some of his predecessors, CEO John Cryan is being honest about some of the struggles that Deutsche Bank is going through right now, and he admits that they may need to be “more ambitious in our restructuring”.  The following comes from Business Insider

Cryan said in a statement (emphasis ours):

“We have continued to de-risk our balance sheet, to invest in our processes and to modernize our infrastructure. However, if the current weak economic environment persists, we will need to be yet more ambitious in the timing and intensity of our restructuring.”

He said something similar in a note to employees (emphasis again ours):

“Here I would like to speak plainly. If this weak economic environment persists, we will need to be still more ambitious in our restructuring. We will do everything in our power to accelerate the measures we have already planned.”

Yes, I know that the stock market in the United States has been setting all sorts of all-time record highs lately.

But that doesn’t change what is going on in the rest of the world one bit.

The financial crisis that has been gripping Europe, Asia, South America and most of the rest of the planet since the second half of last year is accelerating.

And it is inevitable that the U.S. is going to be experiencing some very real pain in the not too distant future as well.

So even though things may seem a bit quiet this summer in the financial world, the truth is that there is a whole lot going on under the surface.

Deutsche Bank is one glaringly obvious example of this, but there are many others all over the globe.  And not too long from now, the dominoes will begin to fall very rapidly.

Erdogan’s Staged Coup Has Resulted In A Purge Of 50,000 Teachers, Judges, Soldiers And Government Officials

Erdogan Staged Coup - Photo by Kemal5105Barack Obama’s “friend” in Turkey is a deeply corrupt radical Islamist dictator that has just staged a coup to consolidate his grip on power.  As I have reported previously, 1,845 “journalists, writers and critics” have been arrested for “insulting” President Erdogan over just the past two years, and a couple of years ago he had a monstrous 1,100 room presidential palace built for himself that is 30 times larger than the White House.  With each passing day, more evidence emerges which seems to indicate that the recent “coup” was a staged event meant to enable Erdogan and his allies to eliminate their enemies and solidify their stranglehold over the nation.  At this point the number of victims of “Erdogan’s purge” has hit 50,000, but the final number will not be known for quite some time.

Of course there is a possibility that the coup was not staged, but if it wasn’t staged it was the worst military coup that I have seen in my entire lifetime.  As Fox News has pointed out, not a single high level member of government was killed or detained…

Among the questions being asked are why coup plotters didn’t execute the most basic steps in seizing power, like securing Erdogan and other top officials. Not a single member of his cabinet and inner-circle AKP party leadership was detained. Nor did coup plotters effectively take control of TV, radio and internet outlets. The government TRT station and CNN Turk were for a time occupied by alleged coup plotters, who quickly retreated as the putsch fell apart.

It is being reported that soldiers that took part in the coup claimed “that they thought that they were taking part in military exercises”, and those running the “coup” allowed Erdogan’s plane to fly across the country without incident.  Here is more from Fox News

Coup plotters also failed to secure most airports and other transportation hubs, didn’t occupy or attack Erdogan’s $600 million presidential palace, and failed to intercept his plane before, during or after he flew from one of the country’s busiest and most accessible airports back to Istanbul. This despite the supposed active participation of top generals in Turkey’s Air Force, which maintains a fleet of F-16 aircraft easily capable of tracking, intercepting or – if it came to it – shooting down Erdogan’s plane.

There were opposition soldiers that did occupy Ataturk International Airport for a short time, but they suspiciously left just in time for Erdogan’s plane to land.

So much about this supposed “coup” absolutely stinks, and that includes the fact that lists of judges, teaches, soldiers and government officials to be rounded up after the coup appear to have been prepared ahead of time.  This is so obvious that even the EU commissioner in charge of Turkey’s membership bid, Johannes Hahn, is commenting on it…

It looks at least as if something has been prepared. The lists are available, which indicates it was prepared and to be used at a certain stage,” Hahn said.

I’m very concerned. It is exactly what we feared.”

So far, at least 50,000 people have been rounded up or stripped of their positions since the coup.  The following breakdown of “the purge” comes from the BBC

  • 6,000 military personnel have been arrested, with more than two dozen generals awaiting trial
  • Nearly 9,000 police officers have been sacked
  • Close to 3,000 judges have been suspended
  • Some 1,500 employees of Turkey’s finance ministry have been dismissed
  • 492 have been fired from the Religious Affairs Directorate
  • More than 250 staff in Mr Yildirim’s office have been removed

Not included in that list are 15,200 education workers and 1,577 university deans that were just sacked

But while Turkey’s press is already mostly under Erdogan’s control, it is the educational witch hunt fallout that is far more troubling, and just as expected over the past hour we have gotten a glimpse of just how extensive the Turkish’s president cleansing of secular society will be, when the state-run Anadolu news agency reported that Turkey’s ministry of education has sacked 15,200 personnel for alleged involvement with a group the government claims is responsible for Friday’s failed coup.

Even more shocking, Anadolu reports that Turkey’s Board of Higher Education has requested the resignations of all 1,577 university deans, effectively dismissing them.  Of the deans dismissed, 1,176 worked in public universities and 401 in private institutions.

In addition, the teaching licenses of 21,000 teachers there were employed at private educational institutions have been revoked.

In one fell swoop, Erdogan is eliminating as much institutional opposition to his leadership as he possibly can.  And not only is he stripping them of their jobs and arresting many of them, CNN is reporting that he actually wants to push for the death penalty for anyone that has any connection to “treason”…

Turkey’s President refuses to rule out the death penalty for thousands of people arrested after a failed military coup Friday, despite warnings that reintroducing capital punishment could dash Turkey’s chances of joining the European Union.

Speaking through his translator in an exclusive interview with CNN’s Becky Anderson, Turkish President Recep Tayyip Erdogan called the failed military coup a “clear crime of treason.”

The Turkish people have made it clear they want death for the “terrorists” who plotted the coup, Erdogan said in his first interview since the July 15 attempt.

Erdogan has been a radical Islamist throughout his entire political career, and his goal has always been to transform Turkey from a highly secular society into a highly Islamic one.

Sadly, now he has the power to do just that.

So what does the future hold for people of other faiths in Turkey?  Well, we may have gotten some clues on the night of the alleged “coup”

During the night of 15 July, unidentified assailants broke the glass panels in the door of the Malatya Protestant Church. The pastor, Tim Stone, said he thought someone with a grudge against the church had taken advantage of the general unrest.

Meanwhile, in Trabzon, on the northern coast, around 10 people smashed the windows of the Santa Maria Catholic Church, where in 2006 a priest, Fr. Andrea Santoro, was murdered. The attackers tried to break into the church, but a group of Muslim neighbors drove them away, before contacting a priest.

And as Erdogan continues to transform into a Turkish version of Adolf Hitler, he is putting his nation’s membership in NATO in jeopardy.  The following comes from the Telegraph

In an ideal world, it would be in everyone’s interests for Mr Erdogan to cease his efforts to turn Turkey into an Iranian-style Islamic republic, thereby allowing Turkey to retain its place at Nato’s top table. But if he really is determined to pursue his radical Islamist agenda, then Nato will have no option but to rid itself of its troublesome Turkish ally.

What is happening in Turkey right now is truly chilling.

A country that is already a member of NATO and that was supposed to become a member of the European Union is rapidly becoming a hardcore radical Islamic dictatorship.

Let us keep a close eye on these developments, because ultimately they could have tremendous implications for Europe and for the entire Middle East in the years ahead.

‘Currency Crash’ Drives British Pound To A 31 Year Low As Deutsche Bank Sinks To The Lowest Level Ever

British Pound Brexit - Public DomainThe fallout from the Brexit vote continues to rock the European financial system.  On Wednesday, the British pound dropped to a fresh 31 year low as confidence in the currency continues to plummet.  At one point it had fallen as low as $1.2796 before rebounding a bit.  As I write this, it is still sitting at just $1.293.  Meanwhile, the problems for the biggest banks in Europe just continue to mount.  At one point on Wednesday Credit Suisse hit an all-time record low, and German banking giant Deutsche Bank closed the day at an all-time record closing low of 12.93.  Overall, Europe’s Stoxx 600 Bank Index closed at the lowest level in almost five years.  What we are watching is a full-blown financial meltdown in Europe, but because it is not personally affecting them yet, most Americans are not paying any attention to it.

The collapse of the British pound that we have seen since the Brexit vote has been nothing short of breathtaking.  In fact, CNN says that this “is what a currency crash looks like”…

This is what a currency crash looks like. The pound has slumped to $1.28, its lowest level in more than three decades.

Investors are dumping the pound following Britain’s vote to leave the European Union on June 23. The pound has dropped roughly 15% since the referendum day, when it reached $1.50.

After appearing to stabilize, the pound resumed its decline this week after three big asset management firms halted withdrawals from real estate investment funds.

Of course this is likely only just the beginning.  There are some analysts that are suggesting that the British pound could eventually hit parity with the U.S. dollar at some point.  We are seeing seismic shifts on the foreign exchange market right now, and this is going to affect trillions of dollars worth of currency-related derivatives.  It will be exceedingly interesting to see how all of this plays out.

Meanwhile, Deutsche Bank continues to get absolutely hammered.

If the biggest and most important bank in Germany is not completely imploding, then why does the stock price continue to crash time after time?

Since the start of 2016, the value of Deutsche Bank has fallen by half, and many have pointed out that the trajectory that it is on is very, very similar to Lehman Brothers in 2008.

My regular readers are probably sick and tired of hearing me warn about Deutsche Bank, so today I will let someone else do it.  According to an article that was just published by the BBC, Deutsche Bank is now “the most dangerous bank in the world”…

Deutsche Bank shares hit a new record low today. It’s value has halved since the beginning of the year.

So is it now the most dangerous bank in the world?

According to the International Monetary Fund – yes.

Last week, the IMF said that, of the banks big enough to bring the financial system crashing down, Deutsche Bank was the riskiest. Not only that, Deutsche Bank’s US unit was one of only two of 33 big banks to fail tests of financial strength set by the US central bank earlier this year.

At this point Deutsche Bank is scrambling to raise cash to stave off an imminent implosion.  Just today, I came across a report about how they plan to sell at least a billion dollars worth of shipping loans in order to bring in some much needed funds.  Many of the steps that they are taking are reminiscent of what Lehman Brothers tried to do just prior to their collapse, and that alone should tell you something.

At the same time all of this is going on, things in Italy just continue to get even worse.  As of this moment, approximately 17 percent of all bank loans held by Italian banks are considered to be “non-performing”.  In other words, they are absolutely swamped by bad debts.  At the height of the 2008 crisis, only about 5 percent of the loans held by U.S. banks were bad.  So what we are watching unfold in Italy right now could definitely be described as “cataclysmic”.

Since the Brexit vote, Italian banks have been hit harder than anyone else.  The following comes from CNN

Shares in Italy’s Banca Monte Dei Paschi Di Siena have crashed 45% in 10 days, forcing regulators to temporarily ban short-selling in the stock. The bank has been given until Friday to come up with a plan to reduce its bad loans by 40% by 2018.

It’s not alone. Other Italian bank stocks have fallen by about 30% since June 23, when the U.K. voted to leave the European Union. Italian officials are trying to find ways to shore up the country’s financial system.

Italian banks have been choking on bad debt for years, but the U.K. vote has thrown their problems into sharp relief.

Personally, I have been amazed that the European financial system has been able to hold it together for this long.  A total collapse was inevitable, but I really thought that it would have started before now.  Up until this time we have seen small crisis after small crisis, but in 2016 the full-blown meltdown has finally arrived.

And this growing crisis in Europe is going to have a dramatic impact on the entire planet.  Everywhere you look the economic fundamentals are getting worse, and if you won’t believe me, perhaps you will believe this editorial by Tim Quast on CNBC

The bottom line is that the fundamentals of the economy and market don’t look good: Whoever you’re listening to — the Federal Reserve, to the Organization for Economic Cooperation and Development, to the International Monetary Fund — hoary heads of the dismal science see deepening malaise worsened by the Brexit, creaky European banks, possible copycat flight from the euro zone — even a slowdown for the U.S.

Can a market characterized by declining money flows, weakening fundamentals and arbitrage that has posted no material gain in over 18 months gather steam? Anything is possible. But it’s not a sound conclusion.

Whenever I post an article about Europe, it tends to get significantly less response than many of my other articles do.

But I hope that my fellow Americans will start paying attention to this growing crisis, because it is going to deeply affect all of us.

What is happening to the European financial system right now is truly history in the making, and I believe that it is going to be one of the biggest news stories of the second half of 2016.

The Price Of Silver Explodes Past 20 Dollars An Ounce As The European Banking Crisis Deepens

Silver Coins 2 - Public DomainHave you seen what the price of silver has been doing?  On Monday, it exploded past 20 dollars an ounce, and as I write this article it is sitting at $20.48.  Earlier today it actually surged above 21 dollars an ounce for a short time before moving back just a bit.  In late March, I told my readers that silver was “ridiculously undervalued” when it was sitting at $15.81 an ounce, and that call has turned out to be quite prescient.  The Friday before last, silver started the day at $17.25 an ounce, and it is up more than 18 percent since that time.  Overall, silver is up more than 30 percent for the year, and that makes it one of the best performing investments of 2016.  So what is causing this sudden surge in the price of silver?  This is something that we will discuss below…

This sudden spike in the price of silver has definitely caught a lot of analysts off guard.  Some are suggesting that the fact that the Fed is now less likely to raise rates after the Brexit and the fact that the dollar has been slipping a bit lately are the primary reasons for silver’s rise

This isn’t a gradual increase either. It’s an explosive growth spurt. Just three months ago silver had reached an 11 month high. Now silver prices have reached a 23 month high. Several factors appear to be influencing these gains, including a weakening dollar, and the fact that the Fed may cut interest rates in light of the Brexit vote.

Personally, I don’t buy those explanations.

To me, the continuing implosion of major banks over in Europe is the main factor that is driving investors to safe haven assets such as silver.

Rumors continue to spread that Deutsche Bank is essentially insolvent at this point, and many are watching for the imminent collapse of the largest and most important bank in Germany.  When this happens, it will be a much, much more cataclysmic event for the global financial system than the collapse of Lehman Brothers was back in 2008.

But today I want to focus on the ongoing implosion of the major banks in Italy.

Italy has the 8th largest economy on the entire planet, and their banks are drowning in approximately 400 billion dollars worth of non-performing debt.

The Italian government would like to bail these banks out, but the rest of the EU appears ready to block that effort because it would violate EU rules.  As a result, the big Italian banks experienced a bloodbath on Monday

Italy’s Banca Monte dei Paschi di Siena SpA BMPS, -13.99% closed down 14%. The move came after a report that the European Central Bank is pushing the lender to draft a new plan aimed at reducing non-performing loans.

Other Italian bank shares were lower, with Banca Popolare dell’Emilia Romagna BPE, -6.73% down 6.7%, Intesa Sanpaolo SpA ISP, -3.04% off 3% and Banca Popolare di Milano SpA PMI, -1.40% lower by 1.4%.

And these stunning declines come on the heels of last week’s nightmare

As a reminder, the Euro Stoxx Banks index was down -0.88% last week and is nearly 19% down from its pre-referendum levels. Italian Banks are at the heart of that weakness with the likes of Unicredit, Intesa, Banco Monte dei Paschi and UBI down -9.78%, -3.44%, -15.79% and -6.11% respectively last week, in the process sending Italian stocks to levels not seen since Draghi’s famous “whatever it takes” speech.

So what happens when all of the major banks of a country collapse at the exact same time?

Basically, Italy is facing “financial Armageddon” if nothing is done, and so some Italian politicians are desperate to step in and do something about this crisis even if it means defying the EU

The Financial Times reported Sunday that Italy was prepared “to defy the EU and unilaterally pump billions of euros into its troubled banking system if it comes under severe systemic distress … despite warnings from Brussels and Berlin over the need to respect rules that make creditors rather than taxpayers fund bank rescues.”

Citing “several officials and bankers familiar with the plans,” the FT said that the threat has raised alarm along Europe’s regulators “who fear such a brazen intervention would devastate the credibility of the union’s newly implemented banking rule book during its first real test.”

But of course the rest of the EU is not about to let this happen because it would be a gross violation of European Union rules

Michael Hewson, chief market analyst at CMC Markets UK, said: “Under current EU state aid rules any attempts to help banks must involve a bail-in process that doesn’t involve using taxpayer’s money.

“Italian Prime Minister Matteo Renzi has tried to argue that the Brexit uncertainty has destabilised Italy’s already fragile banks.

“The reality is the problems of Italy’s banks predate last week’s Brexit vote, and he knows it.”

So what is going to happen?

Could Italy be forced to leave the EU?

Will the rest of the European Union eventually cave in and save Italy?

We all remember how difficult it was for the EU to save Greece, and they are just the 44th largest economy on the planet.

So where in the world are they going to come up with the resources to rescue the 8th largest economy on the planet?

Immediately following the Brexit vote on the Friday before last, we witnessed the biggest one day global stock market loss in world history.  But since that time many global markets have bounced back, and a lot of people seem convinced that the crisis has passed.

Unfortunately, the truth is that the crisis is just getting started.  As I warned before the Brexit vote, European banks were going to continue to implode no matter what the result was, and that is definitely what we are seeing come to pass right now.

Without bailouts, virtually all of the major banks in Italy are going to fail.  It is just a matter of time.  And each of those failures would send financial shockwaves all over the planet.

Personally, I am convinced that the second half of 2016 is going to be even more eventful that the first half of 2016, and this new global economic crisis is going to continue to accelerate.

Unfortunately, most Americans are preoccupied reading about Taylor Swift’s new boyfriend and things of that nature, and so they are totally oblivious to the global events that are about to turn their lives totally upside down.

Black Friday: Shocking Brexit Vote Result Causes The 9th Largest Stock Market Crash In U.S. History

Brexit Vote - Public DomainHas the next Lehman Brothers moment arrived?  Late Thursday night we learned that the British people had voted to leave the European Union, and this could be the “trigger event” that unleashes great financial panic all over the planet.  Of course stocks have already been crashing all over the globe over the past year, but up until now we had not seen the kind of stark fear that the crash of 2008 created following the collapse of Lehman Brothers.  The British people are certainly to be congratulated for choosing to leave the tyrannical EU, and if I could have voted I would have voted to “leave” as well.  But just as I warned 10 days ago, choosing to leave will “throw the entire continent into a state of economic and financial chaos”.  And “Black Friday” was just the beginning – the pain from this event is going to continue to be felt for months to come.

The shocking outcome of the Brexit vote caught financial markets completely off guard, and the carnage that we witnessed on Friday was absolutely staggering…

-The Dow Jones Industrial Average plunged 610 points, and this represented the 9th largest one day stock market crash in the history of the Dow.

-The Nasdaq was hit even harder than the Dow.  It declined 4.12 percent which was the biggest one day decline since 2011.

-Overall, Black Friday erased approximately 800 billion dollars of stock market wealth in the United States.

-Thursday was the worst day ever for the British pound, and investors were stunned to see it collapse to a 31 year low.

-Friday was the worst day ever for European banking stocks.

-Friday was the worst day for Italian stocks since 1997.

-Friday was the worst day for Spanish stocks since 1987.

-Japan experienced tremendous chaos as well.  The Nikkei fell an astounding 1286 points, and this was the biggest drop that we have seen in more than 16 years.

-Banking stocks all over the planet got absolutely pummeled on Black Friday.  The following comes from USA Today

Stocks of some British-based banks suffered double-digit losses in heavy U.S. trading. Barclays (BCS) shares plunged 20.48% to close at $8.89. HSBC (HSBC) shares closed down 9.04% at $30.68. And shares of Royal Bank of Scotland (RBS) plummeted 27.5% to a $5.43 close.

Top U.S. banks also suffered from the Brexit fallout, although not as badly as their British counterparts.

Shares of JPMorgan Chase (JPM) closed down 6.95% at $59.60. Bank of America (BAC) shares fell 7.41% to a $13 close. Citigroup (C) shares dropped 9.36% to close at $40.30. And Wells Fargo (WFC) closed 4.59% lower at $45.71.

-Friday was the best day for gold since the collapse of Lehman Brothers.

-George Soros made a killing on Black Friday because he had already positioned his company to greatly benefit from the Brexit vote ahead of time.

But please don’t think that “Black Friday” was just a one day thing.  As I warned before, the Brexit vote “could be the trigger that changes everything“.  And if you don’t believe me on this, perhaps you will listen to former Federal Reserve Chairman Alan Greenspan.  This is what he told CNBC on Friday…

This is the worst period, I recall since I’ve been in public service,” Greenspan said on “Squawk on the Street.”

“There’s nothing like it, including the crisis — remember October 19th, 1987, when the Dow went down by a record amount 23 percent? That I thought was the bottom of all potential problems. This has a corrosive effect that will not go away.”

I completely agree with Greenspan on this point.  This “corrosive effect” on global markets is not going to go away any time soon.  Sure there will be days when the markets are green just like there were after the collapse of Lehman Brothers, but overall the trend will be down.

Now that the United Kingdom has decided to leave the EU, financial markets have been gripped by fear and uncertainty, and there is a great deal of concern that this Brexit “could harm the economies of everyone involved”

Important British trading partners — including India and China — indicated they were worried that an exit would create regulatory and political volatility that could harm the economies of everyone involved.

The U.K.’s Treasury itself reported that its analysis showed the nation “would be permanently poorer” if it left the EU and adopted any of a number of likely alternatives. “Productivity and GDP per person would be lower in all these alternative scenarios, as the costs would substantially outweigh any potential benefit of leaving the EU,” a summary of the report said.

This threat even extends to the United States.  CNN just published an article that lists four ways the U.S. could be significantly affected by all of this…

1. Fears that the EU may be falling apart
2. Volatile markets slow down the engine of U.S. growth
3. Brexit triggers a strong dollar, which hurts U.S. trade
4. Brexit forces the Fed to rewrite its rate hike playbook

Fortunately we are now heading into the weekend, and that might have a calming effect on the markets.

Or it might just cause financial tension to build up to an extremely high level which will subsequently be released on Monday morning.

We shall see.

RCB’s Charlie McElligott is warning that Black Friday was just the beginning and that “today is the appetizer for Monday”.

And UBS derivatives strategist Rebecca Cheong says that we could see more than a hundred billion dollars of selling over the next two to three trading days

Strategies designed to mitigate risk will actually add to downward pressure in the S&P 500 over the next week as computerized selling ramps up to keep pace with falling prices. It reminds Cheong of the rapid stock selling that roiled markets in August, when the S&P 500 fell 11 percent to a 10-month low while facing similar behavior from algorithmic traders.

“The bigger the down move today, the more they have to sell, which would basically create a vicious cycle,” Cheong, head of Americas equity derivatives strategy at UBS, said in a phone interview. “We’ll see front-loaded selling in the range of $100 billion to $150 billion over the next two to three days. It could be very similar to August in terms of model-based selling.”

Personally, I am hoping for calm when the markets open on Monday.  But without a doubt, something has now shifted as a result of this Brexit vote, and things have suddenly become a whole lot more serious.

So what do you believe we will see happen next week?

Please feel free to tell us what you think by posting a comment below…

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

The Stock Market Crash Of 2016: Stocks Have Already Crashed In 6 Of The World’s 8 Largest Economies

Network Earth Continents - Public DomainOver the past 12 months, stock market investors around the planet have lost trillions of dollars.  Since this time last June, stocks have crashed in 6 of the world’s 8 largest economies, and stocks in the other two are down as well.  The charts that you are about to see are absolutely stunning, and they are clear evidence that a new global financial crisis has already begun.  Of course it is true that we are still in the early chapters of this new crisis and that there is much, much more damage to be done, but let us not minimize the carnage that we have already witnessed.

In general, there have been three major waves of financial panic over the past 12 months.  Late last August we saw the biggest financial shaking since the financial crisis of 2008, then in January and February there was an even bigger shaking, and now a third “wave” has begun in June.  Not all areas around the globe have been affected equally by each wave, but without a doubt this new financial crisis is a global phenomenon.

The charts that I am about to show you come from Trading Economics.  It is an absolutely indispensable website that is packed full of useful data, and I encourage everyone to check it out.

Let’s talk about China first.  The Chinese economy is the second largest on the entire planet, and since this time last year Chinese stocks are down an astounding 40 percent

Chinese Stocks

As things have started to unravel in China, the Chinese have been selling off U.S. debt and U.S. stocks like crazy.  The following comes from Bloomberg

For the past year, Chinese selling of Treasuries has vexed investors and served as a gauge of the health of the world’s second-largest economy.

The People’s Bank of China, owner of the world’s biggest foreign-exchange reserves, burnt through 20 percent of its war chest since 2014, dumping about $250 billion of U.S. government debt and using the funds to support the yuan and stem capital outflows.

While China’s sales of Treasuries have slowed, its holdings of U.S. equities are now showing steep declines.

Unfortunately for China, their economy just continues to slow down, and George Soros is so alarmed by this and a potential “Brexit” that he has been selling off stocks and buying enormous amounts of gold in anticipation of an even bigger global downturn.

Japan has the third largest economy in the world, and over the past year Japanese stocks are down a total of 26 percent from the peak…

Japan Stocks

Personally, I have been extremely alarmed by what has been happening in Japan lately.  Japanese stocks were down almost 500 points last night, and overall the Nikkei is down a whopping 1,800 points so far in June.

Of course the Japanese economy as a whole is essentially a basket case at this point.  For a detailed analysis of this, please see my previous article entitled “Watch Japan – For All Is Not Well In The Land Of The Rising Sun“.

Germany has the fourth largest economy in the world, and over the past year their stocks have fallen 19 percent from the peak of the market…

German Stocks

The key thing to watch for in Germany are serious troubles at their biggest bank.  I wrote a long article about the slow-motion implosion of Deutsche Bank last month, and just this week Deutsche Bank stock hit an all-time low.

The fifth largest economy on the planet belongs to the United Kingdom, and since last June their stocks have fallen about 13 percent

British Stocks

One week from today, the “Brexit” vote will be held in the UK, and if they vote to leave the EU that could have very serious economic and financial implications for them and for the rest of Europe as well.  For an in-depth look at this, please see my previous article entitled “June 23, 2016: The Brexit Vote Could Change EVERYTHING And Plunge Europe Into Financial Chaos“.

France has the sixth largest economy in the world, and over the past year French stocks are down 20 percent from the peak of the market…

French Stocks

The French economy is really struggling these days, and we have not heard much about it in the U.S. media, but there have been tremendous riots in major cities in France in recent weeks.

The seventh largest economy on our planet belongs to India.  Even though India is facing some very serious economic problems, their stocks are doing okay for the moment.  Even though stocks in India are down over the past 12 months, we have not seen a major financial crisis over there just yet.

But there is definitely a major crisis in the eighth largest economy in the world.  Italian stocks are down a staggering 32 percent from the peak of the market.  That means approximately a third of all stock market wealth in Italy is already gone…

Italian Stocks

Earlier this year, I wrote about the horrifying collapse of the Italian banking system that has greatly accelerated since the start of 2016.  It looks like virtually all of their big banks will ultimately need to be bailed out, and this threatens to become a far bigger crisis than the crisis in Greece ever was.

And let us not leave off the ninth largest economy in the world.  Not too long ago, CNN ran an article entitled “Brazil: Economic collapse worse than feared“.  So not only are they admitting that the ninth largest economy on the globe is collapsing, they are also admitting that it is even worse than what the experts had anticipated.

So did I leave anyone off the list?

Ah yes, I haven’t even addressed what has been going on in the United States yet.

U.S. stocks did crash last August, but then they recovered.

Then they crashed again in January, but then they recovered again.

Now U.S. stocks have been taking another tumble here in June, but we are being assured that there is nothing to worry about.

Meanwhile, the underlying numbers for the U.S. economy just continue to get worse and worse and worse.  If you have any doubt about this, please see the article that I posted yesterday entitled “15 Facts About The Imploding U.S. Economy That The Mainstream Media Doesn’t Want You To See“.

Hopefully this article will clear a lot of things up.  In this piece, I have presented undeniable evidence that a new global financial crisis has begun over the past 12 months.  We have not seen global stock declines of this nature since the great financial crisis of 2008, but much worse is still to come.

I would love to be wrong about that last part.

It would be wonderful if the worst was now behind us and good times for the global financial system were ahead.

Unfortunately, every single indicator that I am watching is telling me just the opposite.

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

June 23, 2016: The Brexit Vote Could Change EVERYTHING And Plunge Europe Into Financial Chaos

Brexit - Public DomainOn June 23rd, a vote will be held in the United Kingdom to determine if Britain will stay in the European Union or not.  This is most commonly known as the “Brexit” vote, and that term was created by combining the words “Britain” and “exit”.  If the UK votes to stay in the European Union, things over in Europe will continue on pretty much as they have been.  But if the UK votes to leave, it will likely throw the entire continent into a state of economic and financial chaos.  And considering how bad the European economy is already, this could be the trigger that plunges Europe into a full-blown depression.

So if things will likely be much worse in the short-term if Britain leaves the EU, then it makes sense for everyone to vote to stay, right?

Unfortunately, it isn’t that simple.  Because this choice is not about short-term economics.  Rather, the choice is about long-term freedom.

The EU is a horribly anti-democratic bureaucratic monstrosity that is suffocating the life out of most of Europe a little bit more with each passing year.  So if I was British, I would most definitely be voting to leave the EU.

And in recent days, the campaign to leave has been rapidly picking up steam.  In fact, two of the latest major surveys show that “leave” has taken the lead

An ORB poll for the Telegraph showed 48 percent of Britons would vote to remain in the European Union, while 49 percent would vote to leave.

A YouGov poll for the Times of London showed 46 percent preferred to leave, while 39 percent wanted to remain.

Two other recent polls have “leave” ahead by 10 points, and there is another that actually has “leave” winning by 19 points.

The “leave” movement got a big boost just recently when the Sun officially endorsed that position.  The following is an excerpt from the editorial that announced this decision…

WE are about to make the biggest ­political decision of our lives. The Sun urges everyone to vote LEAVE.

We must set ourselves free from dictatorial Brussels.

Throughout our 43-year membership of the European Union it has proved increasingly greedy, wasteful, bullying and breathtakingly incompetent in a crisis.

Next Thursday, at the ballot box, we can correct this huge and ­historic mistake.

It is our last chance. Because, be in no doubt, our future looks far bleaker if we stay in.

I must say that I agree entirely with the Sun.  However, everyone needs to understand that a Brexit would be incredibly painful for the UK and for the rest of Europe in the short-term.  I think that Ambrose Evans-Pritchard of the Telegraph made this point very well in his recent column…

Let there be no illusion about the trauma of Brexit. Anybody who claims that Britain can lightly disengage after 43 years enmeshed in EU affairs is a charlatan or a dreamer, or has little contact with the realities of global finance and geopolitics.

So what could we potentially see happen?

Well, for one thing big banks like Morgan Stanley are warning that the euro and the British pound could take big hits

The pound and the euro will be hit on a Leave vote, but even if Britain decides to stay in the EU, there will be only “modest gains.” Morgan Stanley expects the pound “to weaken immediately on a vote to Leave, but by year-end we think Euro could weaken even more.”

Secondly, there is a very strong probability that financial markets all over Europe could horribly crash, and the European Central Bank and the Bank of England are already promising to provide artificial support for the markets if that happens.  The following comes from Reuters

The European Central Bank would publicly pledge to backstop financial markets in tandem with the Bank of England should Britain vote to leave the European Union, officials with knowledge of the matter told Reuters.

The preparations illustrate the heightened state of alert ahead of the June 23 referendum, which will help determine Britain’s future in trade and world affairs and also shape the EU. The pound and euro have lost value on fears a Brexit could tip the 28-member bloc into recession.

Such an announcement from the ECB would come on June 24 if an early-morning result showed that British voters had chosen to leave the EU, according to the sources.

But no matter what the consequences are, British voters should do what is right for their future and for the future of their children.

If that means leaving the EU, then so be it.

Needless to say, the prospect of “leave” winning has many among the European elite in full-blown panic mode.  For instance, just consider what the current chairman of the Bilderberg Group is saying

Just day after their mysterious annual meeting in Dresden, it appears The Bilderberg Group’s gravest concern is Brexit. While everything from The Middle East to Donald Trump was on the agenda, the remarks this week from AXA CEO (and Chairman of The Bilderberg Group) Henri de Castries that there is an “extremely high” probability that the U.K. will vote to leave the European Union and investors will face “a true landscape of uncertainties,” suggest the establishment is concerned.

If you are not familiar with the Bilderberg Group, please see my recent article on them.  Certainly the potential of a coming “Brexit” was high on the list of priorities during their recent conference, and it has been documented that the Bilderberg Group played a key role in the creation of the European Union in the first place.  So of course they are not exactly pleased that their grand experiment may now be unraveling right in front of their eyes.

Meanwhile, even without taking into account a potential “Brexit” things just continue to steadily get worse over in Europe.  On Tuesday, European stocks hit their lowest levels since the stock market crash that ended in February, and the stocks of both Deutsche Bank and Credit Suisse hit all-time record lows

The truth is that those extremely prominent European banks are headed for a collapse even without a “Brexit”.  But if there is a “leave” vote, that will just accelerate the process.

And let us not forget that major stock indexes all over Europe are already in a bear market

Meanwhile, German stocks are in a bear-market, with the DAX down 23.2% from its April 2015 peak. The French CAC 40 is down 21.8%. The Spanish Ibex 35 and the Italian MIB are down 31.4% and 32.6% respectively.

Here in the United States, the smart money is dumping stocks like crazy right now, and major investors such as George Soros are feverishly buying gold.

So why are these things happening?

Do those “in the know” have some information regarding what is about to happen over in Europe?

For a long time, I have been sounding the alarm about Europe.  If the British people vote to stay in the European Union on June 23rd, the crisis in Europe will certainly continue to escalate, it will just be at a slower pace.  But if the British people vote to leave (which they should) that could be the trigger that changes everything.

I don’t know exactly what is going to happen on the 23rd, but without a doubt we should all be watching the outcome very, very closely…

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

May 2016: Will Deutsche Bank Survive This Wave Of Trouble Or Will It Be The Next Lehman Brothers?

Euro Question - Public DomainIf you have been waiting for “the next Lehman Brothers moment” which will cause the global financial system to descend into a state of mass panic, you might want to keep a close eye on German banking giant Deutsche Bank.  It is approximately three times larger than Lehman Brothers was, and if the most important bank in the strongest economy in Europe were to implode, it would instantly send shockwaves rippling across the entire planet.  Those that follow my work regularly know that I started sounding the alarm about Deutsche Bank beginning last September.  Since that time, the bad news from Deutsche Bank has not stopped pouring in.  They announced a loss of 6.8 billion euros for 2015, Moody’s just downgraded their debt to two levels above junk status, and they have been plagued by scandal after scandal.  In recent months they have gotten into trouble for trying to rig precious metal prices, for committing “equity trading fraud” and for their dealings in mortgage-backed securities.  The following comes from Zero Hedge

A month after admitting to rigging precious metals markets, Deutsche Bank has been hit with a double-whammy of more alleged fraudulent behavior today and the stock is sliding. First, Reuters reports that the bank took a charge of 450 million euros for “equity trading fraud,” and then Bloomberg reports that The SEC is looking into Deutsche’s post-crisis mortgage positions.

This is a bank that is steadily bleeding money, and so the last thing that it needs is for government agencies to be putting immense pressure on it.  Unfortunately for Deutsche Bank, the SEC seems determined to kick it while it is down

Troubled Wall Street giant Deutsche Bank is under another investigation, this time by the Securities and Exchange Commission regarding the pricing and reporting of certain mortgage-backed securities.

The SEC wants to know whether the Frankfurt, Germany-based bank artificially raised the value of mortgage-backed securities in 2013 and later hid those losses for an extended period of time, Bloomberg first reported, citing people familiar with the matter.

But even if there were no scandals and no government investigations, the truth is that Deutsche Bank would be a deeply troubled bank anyway.

At one point, it was estimated that Deutsche Bank had 64 trillion dollars worth of exposure to derivatives contracts.  That is an amount of money that is approximately 16 times the size of the GDP of the entire nation of Germany.

So nobody wants to see Deutsche Bank fail.  It would be a financial disaster unlike anything the world has ever experienced before.

But right now things are not looking good.  As you can see from this chart, the steady decline of Deutsche Bank’s stock price is eerily similar to what happened to Lehman Brothers during the months leading up to the time when it finally completely collapsed…

Deutsche Bank Lehman Brothers - Zero Hedge

Earlier this year, Deutsche Bank’s stock price set a new record low, and since that time it has been hovering just above that record low.

Clearly it is no secret that Deutsche Bank is having big problems, and the outlook for the immediate future is not good.  I included the following quote from Berenberg analyst James Chappell in a previous article, but I think that it bears repeating…

Too many problems still: The biggest problem is that DBK has too much leverage. On our measures, we believe DBK is still over 40x levered. DBK can either reduce assets or increase capital to rectify this. On the first path, the markets do not exist in the size nor pricing to enable it to follow this route. Going down the second path also seems impossible at the moment, as the profitability of the core business is under pressure. Seeking outside capital is also likely to be difficult as management would likely find it hard to offer any type of return on new capital invested.

In the end, I believe that Deutsche Bank will ultimately implode, but it won’t be the only one.

Meanwhile, we just got some more very disturbing news out of Asia.  According to Bloomberg, Japanese exports have now fallen for seven months in a row…

Japan’s exports fell for a seventh consecutive month in April as the yen strengthened, underscoring the growing challenges to Prime Minister Shinzo Abe’s efforts to revive economic growth.

Overseas shipments declined 10.1 percent in April from a year earlier, the Ministry of Finance said on Monday. The median estimate of economists surveyed by Bloomberg was for a 9.9 percent drop. Imports fell 23.3 percent, leaving a trade surplus of 823.5 billion yen ($7.5 billion), the highest since March 2010.

When your imports are 23 percent lower than they were a year earlier, that is a clear sign that consumer demand is way, way down and that your economy is in the process of imploding.

So I will repeat what I have said a number of times before…

Watch Germany and watch Japan.

I believe that they are going to be two of the biggest stories as this new global financial crisis begins to play out.

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

Economic Collapse Is Erupting All Over The Planet As Global Leaders Begin To Panic

Earth Ready To Explode - Public DomainMainstream news outlets are already starting to use the phrase “economic collapse” to describe what is going on in some areas of our world right now.  For many Americans this may seem a bit strange, but the truth is that the worldwide economic slowdown that began during the second half of last year is starting to get a lot worse.  In this article, we are going to examine evidence of this from South America, Europe, Asia and North America.  Once we are done, it should be obvious that there is absolutely no reason to be optimistic about the direction of the global economy right now.  The warnings of so many prominent experts are now becoming a reality, and what we have witnessed so far are just the early chapters of a crushing economic crisis that will affect every man, woman and child in the entire world.

Let’s start with Brazil.  It has the 7th largest economy on the entire planet, and it is already enduring its worst recession in 25 years.  In fact, at the end of last year Goldman Sachs said that what was going on down there was actually a “depression“.

But now the crisis in Brazil has escalated significantly.

I want to share with you an excerpt from a recent article entitled “Brazil: Economic collapse worse than feared“.  I know, that title sounds like it comes directly from The Economic Collapse Blog, but I didn’t write it.

It actually comes from CNN

Amid political chaos, Brazil’s economic collapse is worse than its government once believed.

In the midst of rising calls to impeach President Dilma Rousseff, Brazil’s central bank announced Thursday that it now expects the country’s economy to shrink 3.5% this year.

That’s worse than the central bank’s previous estimate for a 1.9% contraction. The darker forecast matches what the International Monetary Fund projected for Brazil — Latin America’s largest country — and what many independent economists have suspected.

It is one thing for Michael Snyder to tell you that Brazil is in the midst of “economic collapse”, but it is another thing entirely for CNN to say it.

And of course I have been warning about the crisis down in Brazil for quite some time now.  For much more on this, please see my previous article entitled “The Economic Collapse Of South America Is Well Underway“.

Meanwhile, things are actually much worse in Venezuela than they are in Brazil.  Food and basic supplies are in short supply, the inflation rate has hit 720 percent, and crime is completely out of control.

The following is from an article in the Independent entitled “Venezuela is on the brink of complete economic collapse“…

The only question now is whether Venezuela’s government or economy will completely collapse first.

The key word there is “completely.” Both are well into their death throes. Indeed, Venezuela’s ruling party just lost congressional elections that gave the opposition a veto-proof majority, and it’s hard to see that getting any better for them any time soon — or ever.

Incumbents, after all, don’t tend to do too well when, according to the International Monetary Fund, their economy shrinks 10 percent one year, an additional 6 percent the next, and inflation explodes to 720 percent. It’s no wonder, then, that markets expect Venezuela to default on its debt in the very near future. The country is basically bankrupt.

Once again we see a very respected mainstream publication using the phrase “economic collapse” to describe what is happening in South America.

You can find some stunning video of the “economic Armageddon” that is taking place in Venezuela right here.  I would encourage you to watch that video, because what is happening down there will eventually be happening here.

Meanwhile, over in Europe the collapse of the Italian banking system has entered a disturbing new chapter.  Italy’s finance minister has called a meeting in Rome for Monday that will be focusing on a “last resort” bailout plan for the troubled banks…

Finance minister Pier Carlo Padoan has called a meeting in Rome on Monday with executives from Italy’s largest financial institutions to agree final details of a “last resort” bailout plan.

Yet on the eve of that gathering, concerns remain as to whether the plan will be sufficient to ringfence the weakest of Italy’s large banks, Monte dei Paschi di Siena, from contagion, according to people involved in the talks.

Italian bank shares have lost almost half their value so far this year amid investor worries over a €360bn pile of non-performing loans — equivalent to about a fifth of GDP. Lenders’ profitability has been hit by a crippling three-year recession.

As Italy descends into financial chaos, the rest of the continent better be paying attention.

Do you remember how hard it was for the rest of Europe to rescue Greece?

Well, Greece has the 44th largest economy on the planet.

Italy has the 8th.

It would be hard to overstate the seriousness of what is going on over in Europe, and it is not just Italy we are talking about.  All over the continent major banks are in deep trouble, and the chairman of France’s second largest  retail bank recently told reporters that “I am much more worried than I was in 2009“.

And there is very good reason for concern.  On Sunday, we learned that a major “bail-in” had just been announced for one of Austria’s most prominent banks.  The following comes from Zero Hedge

And then today, following a decision by the Austrian Banking Regulator, the Finanzmarktaufsicht or Financial Market Authority, Austria officially became the first European country to use a new law under the framework imposed by Bank the European Recovery and Resolution Directive to share losses of a failed bank with senior creditors as it slashed the value of debt owed by Heta Asset Resolution AG.

The highlights from the announcement:

Today, the Austrian Financial Market Authority (FMA) in its function as the resolution authority pursuant to the Bank Recovery and Resolution Act (BaSAG – Bundesgesetz über die Sanierung und Abwicklung von Banken) has issued the key features for the further steps for the resolution of HETA ASSET RESOLUTION AG. The most significant measures are:

  • a 100% bail-in for all subordinated liabilities,
  • a 53.98% bail-in, resulting in a 46.02% quota, for all eligible preferential liabilities,
  • the cancellation of all interest payments from 01.03.2015, when HETA was placed into resolution pursuant to BaSAG,
  • as well as a harmonisation of the maturities of all eligible liabilities to 31.12.2023.

According to the current resolution plan for HETA, the wind-down process should be concluded by 2020, although the repayment of all claims as well as the legally binding conclusion of all currently outstanding legal disputes will realistically only be concluded by the end of 2023. Only at that point will it be possible to finally distribute the assets and to liquidate the company.

The dominoes are starting to fall in Europe, and I would expect even bigger announcements in the weeks and months to come.

Over in Asia, economic chaos is beginning to prevail as well.

In China, the stock market is already down more than 40 percent from the peak, Chinese exports were down 25.4 percent on a year over year basis in February, and Chinese economic numbers overall have not been this poor since the depths of the last global recession.

At the same time, the Japanese economy is really struggling right now.  As I wrote about the other day, Japanese GDP has shrunk for two out of the last three quarters, we just saw Japanese industrial production experience the biggest one month decline that we have witnessed since the tsunami of 2011, and business sentiment has fallen to a three year low.  The Nikkei has dropped by about 5,000 points from where it was last summer, and some analysts believe that Japanese markets “are being destroyed” due to massive intervention by the Bank of Japan.

Here in the United States, we haven’t been hit quite as hard as the rest of the world just yet, but there are lots of very disturbing warning signs all around us.

At the end of last week, we learned that it is being projected that U.S. GDP will have grown by just 0.1 or 0.2 percent during the first quarter of 2016.  And on Monday corporate earnings reporting season begins, and it is expected to be a very, very bad one.  The following comes from Business Insider

We are about to get confirmation that earnings growth for America’s biggest companies was negative in the first quarter, compared to the same period a year ago.

When aluminum giant Alcoa releases its results on Monday, it will mark the unofficial start of the heaviest reporting season for S&P 500 companies.

The final scoreboard is expected to show a 9.1% earnings drop for the quarter, according to FactSet senior earnings analyst John Butters.

If these projections turn out to be accurate, it will be the fourth quarter in a row of earnings declines.  This is something that we never see outside of a recession.

And for a whole bunch more numbers which indicate that the U.S. economy is in very serious trouble, please see my previous article entitled “19 Facts That Prove Things In America Are Worse Than They Were Six Months Ago“.

Of course I am just another voice in the crowd when it comes to predicting that the U.S. economy is headed for rough times.  For example, just check out what Societe Generale economist Albert Edwards is saying

A tidal wave is coming to the US economy, according to Albert Edwards, and when it crashes it’s going to throw the economy into recession.

…the profit recession facing American corporations is going to lead to a collapse in corporate credit.

“Despite risk assets enjoying a few weeks in the sun our fail-safe recession indicator has stopped flashing amber and turned to red”

He continued:

Whole economy profits never normally fall this deeply without a recession unfolding. And with the US corporate sector up to its eyes in debt, the one asset class to be avoided — even more so than the ridiculously overvalued equity market — is US corporate debt. The economy will surely be swept away by a tidal wave of corporate default.

As you can see, it isn’t just one nation or one region of the world that we need to be concerned about.

Economic chaos is erupting literally all over the planet, and global leaders are starting to panic.

Unfortunately, they have had seven years to try to fix things since the last global recession, and they didn’t get the job done.  Anyone that believes that by some miracle they will be able to pull us out of the fire this time and that everything will somehow be okay is simply engaged in wishful thinking.

*About the author: Michael Snyder is the founder and publisher of The Economic Collapse Blog. Michael’s controversial new book about Bible prophecy entitled “The Rapture Verdict” is available in paperback and for the Kindle on Amazon.com.*

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