Stock Markets

Now The Iranians Are Promising More Military Action Against U.S. Forces, And That Would Definitely Start World War 3

What in the world are the Iranians thinking?  After President Trump decided not to respond militarily to the rockets that the Iranians fired at U.S. bases in Iraq, it appeared that a major war had been averted.  People all over the world celebrated this unexpected turn of events, and global stock markets soared.  But now the Iranians are changing their tune again.  Instead of “standing down”, top Iranian leaders are warning that “harsher revenge” is on the way and that there will be more attacks against U.S. forces.  I think that Iran correctly perceives that Trump does not want a war, but if Trump gets pushed too far he will hit the Iranians extremely hard.  And once the Iranian homeland starts getting pummeled by U.S. missiles, the Iranians will start firing some of the 200,000 missiles that they have stockpiled at Israel, and needless to say the Israelis will respond with even greater force.  In other words, any escalation of this conflict at this point has the potential to spark World War 3.

So the Iranians would be wise to stop this nonsense while they still can, but apparently they have no intention of doing so.

On Thursday, the commander of the Revolutionary Guard’s Aerospace Force claimed that the missile attacks the other night were just “the first stage of a major regional operation aimed at expelling U.S. forces from the Middle East”…

Iran’s missile strikes on Iraqi bases housing U.S. troops were the first stage of a major regional operation aimed at expelling U.S. forces from the Middle East, the Iranian commander responsible for the attack said Thursday.

Brig. Gen. Amir Ali Hajizadeh, who as commander of Iran’s Revolutionary Guard’s Aerospace Force oversees most of Iran’s missile arsenal, stopped short of threatening further concrete military action. He also said Iran hadn’t intended to kill anyone in Wednesday’s attack but only to cause material damage.

And Revolutionary Guard commander Abdollah Araghi is promising that “harsher revenge” is coming soon…

A senior Iranian military commander has promised further action against the United States, a day after Tehran launched missiles at two bases housing US troops in Iraq.

Islamic Revolutionary Guard Corps (IRGC) commander Abdollah Araghi said that Iran would take “harsher revenge soon,” without specifying what that might entail, Tasnim news agency reported on Thursday.

Do they actually believe that Trump will allow them to repeatedly attack our forces without responding?

If any American had been killed during the missile strikes the other night, it is quite likely that Trump would have responded already.

And when Trump acts, he likes to make a major statement.

Iran is playing a very dangerous game, and if they miscalculate just a little bit there will be disastrous consequences.

Unfortunately, they are so blinded by rage that they don’t appear to be thinking rationally.  At this point, the Iranian media is reporting that the recent missile attacks were “only the beginning of the strikes”…

Tasnim News Agency reported on Thursday that the missiles that hit U.S. interests in Iraq were only the beginning of the strikes.  The deputy head of the IRGC, Ali Fadavi, described Iran’s missile attacks on US forces as a display of the Islamic Republic’s military capabilities, claiming that the Americans “couldn’t do a damn thing” about the strikes.

Many of us had been hoping that cooler heads would prevail, but at least on the Iranian side that does not appear to be happening.

And Iranian proxies are already lobbing rockets at U.S. targets.  For example, on Wednesday a couple of “small rockets” were launched toward the Green Zone in Baghdad…

Small rockets hit the area in or around the Green Zone in Iraq’s capital of Baghdad late Wednesday, a day after Iran launched missiles at bases housing U.S. and other coalition forces in Iraq, American military officials said.

There was no casualties to U.S. or other coalition forces in the area, and no damage to facilities in the Green Zone, which contains the American embassy and other Western diplomatic posts, officials said.

Subsequently, there was a rocket attack on Balad Air Base in Iraq on Thursday…

Another day, another rocket (alleged) rocket attack on a US airbase in Iraq.

Al-Sumaria reports that rockets hit the Balad Air Base, about 40 miles north of Baghdad, where US troops are stationed.

The source said in an interview with Alsumaria News, “A missile, whose type was not specified, fell this evening, to the Fadlan area of ​​the Dujail district near Balad Air Base,” without giving further details.

Iranian proxies would not be doing this if they did not have permission from Tehran.

Perhaps President Trump is waiting until there are American casualties to respond, and he certainly is not eager to get the U.S. involved in a major war during an election year, but at some point his patience is going to run out.

Meanwhile, the IDF has just conducted a stunning attack on Iranian-backed militia targets “on the border between Syria and Iraq”…

According to reports by domestic and western media, the Israeli air force carried out an attack against an Iran-backed militia reportedly headquartered on the border between Syria and Iraq.

Tribal sources in Iraq apparently told reporters that the Israeli shelling targeted trucks and individuals associated with Iranian-backed militias near the Iraqi-Syria border. Artillery and shelling was also reported, though it’s unclear who fired those shots. The weapons are believed to have been destined for Hezbollah.

In the end, even if President Trump is absolutely determined to keep the U.S. out of a major conflict there will still be a war between Israel and Iran.

The Iranians have restarted their nuclear program, and Israeli Prime Minister Benjamin Netanyahu has pledged that Iran will never be allowed to finish it.

The clock is ticking, and Israel is going to do whatever it takes to keep the psychopaths in Iran from being able to build their own nuclear weapons.

So one way or another, war is definitely coming, and it will change all of our lives in a major way.

But many were hoping that World War 3 was at least delayed for a while after Trump showed such great restraint on Wednesday.

Unfortunately, the Iranians seem determined to press their luck, and we are all going to pay a great price for their complete and utter recklessness.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

Global Stocks Continue To Crash As Oil Plummets And Gold Skyrockets

Clock Image - Public DomainStock markets around the world continue to collapse as this new global financial crisis picks up more steam.  In the U.S., the Dow lost 254 more points on Thursday, and it has now fallen for five days in a row.  European stocks continued to get obliterated, and financial institutions are leading the way.  But this week what is happening in Japan has been the most sobering.  After falling 918 points the other day, the Nikkei plunged another 760 points early on Friday.  The Nikkei has now fallen for seven of the past eight days, and investors in Japan are in full panic mode.  Overall, global stocks are well into bear market territory, and nearly 17 trillion dollars of global stock market wealth has already been wiped out.

As panic rises, investors are seeking alternative investments.  On Thursday, the price of gold hit $1,260 an ounce at one point before settling back a bit.  But even with the fade at the end of the day, it was still the biggest daily gain in more than two years.  Overall, gold is having its best quarterly performance in 30 years.

Whenever a financial crisis happens, investors seek out safe havens such as gold that can help them weather the storm.  In particular, demand for physical gold is going through the roof all over the planet.  Just check out the following excerpt from a Telegraph article entitled “Investors ‘go bananas’ for gold bars as global stock markets tumble“…

BullionByPost, Britain’s biggest online gold dealer, said it has already taken record-day sales of £5.6m as traders pile into gold following fears the world is on the brink of another financial crisis.

Rob Halliday-Stein, founder and managing director of the Birmingham-based company, said takings today had already surpassed the firm’s previous one-day record of £4.4m in October 2014.

BullionByPost, which takes orders of up to £25,000 on the website but takes higher amounts over the phone, explained it had received a few hundred orders overnight and frantic numbers of phone calls this morning.

Meanwhile, the price of oil continues to drop to stunning new depths.  On Thursday U.S. oil dropped as low as $26.21, which was the lowest price in 13 years.  Not even during the worst parts of the last financial crisis did oil ever go this low.

And remember, the price of oil was sitting at about $108 a barrel back in June 2014.  Since that time it has fallen about 75 percent.

Needless to say, this crash is having some very serious consequences for the energy industry.  Previously, I have reported that 42 North American energy companies have gone into bankruptcy since the beginning of last year.

But I just found out that the true number is much worse than that.

According to CNN, “67 U.S. oil and natural gas companies filed for bankruptcy in 2015″…

Bankruptcy filings are flying in the American oil patch.

At least 67 U.S. oil and natural gas companies filed for bankruptcy in 2015, according to consulting firm Gavin/Solmonese.

That represents a 379% spike from the previous year when oil prices were substantially higher.

With oil prices crashing further in recent weeks, five more energy gas producers succumbed to bankruptcy in the first five weeks of this year, according to Houston law firm Haynes and Boone.

A lot of people tend to think that my writing is full of “doom and gloom”, but the truth is that I often understate how bad things really are.  I’ll often report one number and find out later that an updated number is even worse than the one that I originally reported.

What we desperately need is for the price of oil to go back up.

Unfortunately, the International Energy Agency says that isn’t likely to happen any time soon…

The International Energy Agency said earlier this week that it expects the global oil glut to grow throughout the year.

“With the market already awash in oil, it is very hard to see how oil prices can rise significantly in the short term,” the IEA said in its monthly report.

And of course all of this is incredibly bad news for financial institutions all over the world.

During the boom times, the big banks showered energy companies with loans.  Now those loans are going bad, and the big banks are feeling the pain.  The following comes from CNN…

It’s never a good sign when the country’s financial lifelines are under stress. Large U.S. banks JPMorgan Chase (JPM) and Wells Fargo (WFC) that helped bankroll the energy boom are already setting aside billions to cover potential loan losses in the oil industry. Investors are worried about imploding energy loans for European banks like Deutsche Bank (DB). High yield bonds in your investing portfolio wont be looking good either — Standard & Poor’s warned that half of all energy junk bonds are at risk of defaulting.

Speaking of Deutsche Bank, their stock price continued to plummet on Thursday, as did the stock prices of most other European banks.

Things were particularly bad for France’s Societe Generale.  Their stock price plunged 12 percent on Thursday alone.

This is what a global financial crisis looks like.  It began during the second half of last year, and now it is making major headlines all over the planet.

At this point, things are already so bad that the elite are starting to freak out about what this could potentially mean for them.  I want you to carefully consider the following two paragraphs from an editorial that I came across in the Telegraph earlier today…

We are too fragile, fiscally as well as psychologically. Our economies, cultures and polities are still paying a heavy price for the Great Recession; another collapse, especially were it to be accompanied by a fresh banking bailout by the taxpayer, would trigger a cataclysmic, uncontrollable backlash.

The public, whose faith in elites and the private sector was rattled after 2007-09, would simply not wear it. Its anger would be so explosive, so-all encompassing that it would threaten the very survival of free trade, of globalisation and of the market-based economy. There would be calls for wage and price controls, punitive, ultra-progressive taxes, a war on the City and arbitrary jail sentences.

I think that the author of this editorial is correct.

I do believe that another financial crisis on the scale of 2008 would trigger “a cataclysmic, uncontrollable backlash”.

In fact, I believe that is what we are steamrolling toward right now.

We can already see the anger of the American people toward the establishment being expressed in their support of Bernie Sanders and Donald Trump.

But if the financial system completely collapses and it becomes exceedingly apparent that none of our problems from the last time around were ever fixed, the frustration is going to be off the charts.

Many people believed that this day of reckoning would never come, but now it is here.

The “coming nightmare” is now upon us, and this is just the start.

The rest of 2016 promises to be even more chaotic, and ultimately this new crisis is going to turn out to be far worse than what we experienced back in 2008.

Stock Markets All Over The World Crash As We Begin 2016

Dominoes - Public DomainThe first trading day of 2016 was full of chaos and panic.  It started in Asia where the Nikkei was down 582 points, Hong Kong was down 587 points, and Chinese markets experienced an emergency shutdown after the CSI 300 tumbled 7 percent.  When European markets opened, the nightmare continued.  The DAX was down 459 points, and European stocks overall had their worst start to a year ever.  In the U.S., it looked like we were on course for a truly historic day as well.  The Dow Jones Industrial Average was down 467 points at one stage, but some very mysterious late day buying activity helped trim the loss to just 276 points at the close of the market.  The sudden market turmoil caught many by surprise, but it shouldn’t have.  The truth is that a whole host of leading indicators have been telling us that this is exactly what should be happening.  The global financial crisis that began in 2015 is now accelerating, and my regular readers already know precisely what is coming next.

The financial turmoil of the last 24 hours is making headlines all over the globe.  It began last night in China.  Very bad manufacturing data and another troubling devaluation of the yuan sent Chinese stocks tumbling to a degree that we have not seen since last August.  In fact, the carnage would have probably been far, far worse if not for a new “circuit breaker” that China recently implemented.  Once the CSI 300 was down 7 percent, trading was completely shut down for the rest of the day.  The following comes from USA Today…

Under a new market “circuit breaker” rule in China established last year, which is designed to slow down markets and halt panic in the event of moves of 5% or more, the CSI 300, a large-company stock index in mainland China was halted for 15 minutes in mid-afternoon trading after diving more than 5%. But when shares headed lower once again just minutes after the initial trading halt, and losses for the day swelled to more than 7%, the new circuit breaker rules kicked in, prompting a shutdown of mainland China’s stock market for the day, according to Bloomberg.

After the first 15 minute halt, panic set in as Chinese traders rushed to get out of their trades before the 7 percent circuit breaker kicked in.  This resulted in an absolutely chaotic seven minutes as investors made a mad dash for the exits…

The sell orders piled up fast on Monday at Shenwan Hongyuan Group, China’s fifth-biggest brokerage by market value.

China’s CSI 300 Index had just tumbled 5 percent, triggering a 15-minute trading halt, and stock investors were scrambling to exit before getting locked in by a full-day suspension set to take effect at 7 percent. When the first halt was lifted, the market reaction was swift: it took just seven minutes for losses to reach the limit as volumes surged to their highs of the day.

“Investors rushed to the door during the level-one stage of the circuit breaker as they fretted the market would go down further,” said William Wong, the head of sales trading at Shenwan Hongyuan in Hong Kong.

The financial carnage continued once the European markets opened.  Markets were red all across the continent, and things were particularly bad in Germany.  The DAX was down 459 points, and it is rapidly approaching the psychologically-important 10,000 barrier.  Overall, it was the worst start to a year that the European markets have ever experienced.

When U.S. markets opened, unexpectedly bad U.S. manufacturing data seemed to add fuel to the fire.  Monday morning we learned that our manufacturing sector is contracting at a pace that we haven’t seen since the last recession…

America’s manufacturing sector shrank for the second straight month in December. The industry’s key index — ISM — hit 48.2% in December, the lowest mark since June 2009. Anything below 50% is a contraction and a month ago it hit 48.6%.

The index has fallen for six straight months.

“The trend is certainly heading in a direction that would ring alarm bells,” says Sam Bullard, senior economist at Wells Fargo.

This is yet another sign that tells us that the U.S. economy has already entered the next recession.

And what happens to the markets during a recession?

They go down.

In addition to the bad data that we got from the U.S. and China, there was another number that was also extremely troubling.

South Korean exports have traditionally been considered a key leading indicator for the entire global economy, and on Monday we learned that they were down a whopping 13.8 percent in December from a year earlier…

One of the more reliable indicators of the global economy continues to confirm fears of a worldwide slowdown.

South Korean exports — also referred to as the world’s economic canary in the coal mine — fell 13.8% in December from a year earlier.

This was a deterioration from the 4.8% decline in November, and it was much worse than the 11.7% decline expected by economists.

The “nothing is happening” crowd may not be willing to admit it yet, but the truth is that a major global economic slowdown is already happening.

And what happened to global markets today is perfectly consistent with the longer term patterns that have been emerging over the past six months or so.

In the weeks and months to come, things are going to get even worse.  There will always be days when the markets are up, but don’t let those days fool you into thinking that the crisis is over.  In the western world we are so accustomed to 48 hour news cycles, and many of us seem to be incapable of focusing on trends that develop over longer periods of time.

If I was going to put together a scenario for a global financial crisis for a textbook, what we have seen over the past six months or so would be perfect.  Things are playing out exactly how they should be, and that means big trouble for the rest of 2016.

But that doesn’t mean that we have to live in fear.  In fact, I just wrote an entire article entitled “2016: A Year For Living With No Fear“.  It is when times are at their worst that our character is put to the test.  Some will respond to what happens in 2016 with courage and strength, and others will respond with fear and panic.

As things start falling apart all around us this year, how will you respond?

This Is What A Financial Crisis Looks Like

Financial Crisis 2015 - Public DomainJust within the past few days, three major high yield funds have completely imploded, and panic is spreading rapidly on Wall Street.  Funds run by Third Avenue Management and Stone Lion Capital Partners have suspended payments to investors, and a fund run by Lucidus Capital Partners has liquidated its entire portfolio.  We are witnessing a race for the exits unlike anything that we have seen since the great financial crash of 2008, and many of those that choose to hesitate are going to end up getting totally wiped out.  In case you are wondering, this is what a financial crisis looks like.  In 2008, other global stock markets started to tumble, then junk bonds began to crash, and finally U.S. stocks followed.  The exact same pattern is playing out again, and the carnage that we have seen so far is just the tip of the iceberg.

Since the end of 2009, a high yield bond ETF that I watch very closely known as JNK has been trading in a range between 36 and 42.  I have been waiting all this time for it to dip below 35, because I knew that would be a sign that the next major financial crisis was imminent.

In September, it closed as low as 35.33 at one point, but that was not the signal that I was looking for.  Finally, early last week JNK broke below 35 for the very first time since the last financial crisis, and since then it has just kept on falling.  As I write this, JNK has plummeted all the way to 33.42, and Bloomberg is reporting that many bond managers “are predicting more carnage for high-yield investors”…

Top bond managers are predicting more carnage for high-yield investors amid a market rout that forced at least three credit funds in the past week to wind down.

Lucidus Capital Partners, a high-yield fund founded in 2009 by former employees of Bruce Kovner’s Caxton Associates, said Monday it has liquidated its entire portfolio and plans to return the $900 million it has under management to investors next month. Funds run by Third Avenue Management and Stone Lion Capital Partners have stopped returning cash to investors, after clients sought to pull too much money.

When it says that those firms “have stopped returning cash to investors”, what that means is that many of those investors will be lucky to get pennies on the dollar when it is all said and done.

Like I said, now that the crisis has started, the ones that are going to lose the most are those that hesitate.

And just check out some of the very big names that are “warning of more high-yield trouble ahead”…

Scott Minerd, global chief investment officer at Guggenheim Partners, predicts 10 percent to 15 percent of junk bond funds may face high withdrawals as more investors worry about getting their money back. He joins money managers Jeffrey Gundlach, Carl Icahn, Bill Gross and Wilbur Ross in warning of more high-yield trouble ahead.

In this type of environment, the Federal Reserve would have to be completely insane to raise interest rates.

Unfortunately, that appears to be exactly what is going to happen.

If the Fed raises rates, that is going to make corporate debt defaults even more likely and will almost certainly drive high-yield bonds down even further…

Higher rates could make corporate bond defaults more likely and investors are already bailing out of the sector, pulling $3.8 billion out of high-yield funds in the week ended December 9, the biggest move in 15 weeks. The effective yield on U.S. junk bonds is now 17 percent, the highest level in five years, according to Bank of America Merrill Lynch data.

A whole host of prominent names are warning that the Fed is about to make a tragic mistake.  One of them is James Rickards…

“The Fed should have raised interest rates in 2010 and 2011 and if they did that they would actually be in a position to cut them today,” said James Rickards, a central bank critic and chief global strategist at West Shore Funds. “The Fed is on the brink of committing a historic blunder that may rank with the mistakes it made in 1927 and 1929. By raising into weakness, they will likely cause a recession.”

In 2015, we have already seen stocks crash all over the globe.  Coming into December, more than half of the 93 largest stock market indexes in the world were down more than 10 percent year to date, and some of them were down by as much as 30 or 40 percent.  At this point, conditions are absolutely perfect for a frightening collapse of U.S. markets, and the Federal Reserve is about to pour gasoline on to the fire.

Anyone that says that “nothing is happening” is either completely misinformed or is totally crazy.

I like how James Howard Kunstler summarized what we are currently facing…

Equities barfed nearly four percent just last week, credit is crumbling (nobody wants to lend), junk bonds are tanking (as defaults loom), currencies all around the world are crashing, hedge funds can’t give investors their money back, “liquidity” is AWOL (no buyers for janky securities), commodities are in freefall, oil is going so deep into the sub-basement of value that the industry may never recover, international trade is evaporating, the president is doing everything possible in Syria to start World War Three, and the monster called globalism is lying in its coffin with a stake pointed over its heart.

The financial markets held together far longer than many people thought that they would, but now they are finally coming apart at the seams.

Moving forward, the “winners” are going to be the people that pull their money out the fastest.  This is especially true for high risk funds like the three that just imploded.  If you hesitate, you could end up losing everything.

And as this rush for the exits accelerates, sellers are going to greatly outnumber buyers, and this is going to push prices down at a very rapid pace.  We are going to hear a lot about a “lack of liquidity” in the days ahead, but the truth is that what we will really be looking at is a good old-fashioned panic.

27 Major Global Stocks Markets That Have Already Crashed By Double Digit Percentages In 2015

Earth Globe - Public DomainAnyone that tries to tell you that a global financial crisis is not happening is not being honest with you.  Right now, there are 27 major global stock markets that have declined by double digit percentages from their peaks earlier this year.  And this is truly a global phenomenon – we have seen stock market crashes in Asia, Europe, South America, Africa and the Middle East.  But because U.S. stocks are only down less than a thousand points from the peak earlier this year, most Americans seem to think that everything is just fine.

The truth, of course, is that everything is not fine.  We are witnessing a pattern similar to what we saw back in 2008.  Back then, Chinese stocks and other major stock markets started crashing first, and then U.S. stocks followed later.

And it appears that we may have entered the next leg down for markets in the western world this week.  The Dow was down another 252 points on Thursday, and all of the major stock indexes in the U.S. are now negative for the year except for the NASDAQ.  Unless there is a major turnaround in the coming weeks, the six year winning streak for U.S. stocks is likely over.

But when you step back and look at what has been happening globally, a much more ominous picture emerges.  I spent much of the afternoon looking at stock market charts for the largest economies all over the globe.  What I discovered was financial carnage that was much worse than I anticipated.

It turns out that there are 27 major global stock markets that have fallen by more than 10 percent from peaks that were set earlier this year.  If you want to verify this information for yourself, just go to Trading Economics.  As you can see, many of these stock market declines have been quite impressive…

1. China: down more than 30 percent

2. Saudi Arabia: down 26 percent

3. Germany: down about 13 percent

4. United Kingdom: down close to 12 percent

5. Spain: down 15 percent

6. Brazil: down more than 22 percent (13,000 points overall)

7. Kuwait: down 14 percent

8. Turkey: down 16 percent

9. India: down close to 12 percent

10. Chile: down 11 percent

11. Columbia: down about 30 percent

12. Peru: down more than 40 percent

13. Bulgaria: down more than 20 percent

14. Greece: down more than 30 percent

15. Poland: down about 19 percent

16. Malaysia: down 10 percent

17. Egypt: down 32 percent

18. Indonesia: down 18 percent

19. Canada: down 12 percent

20. Ukraine: down 45 percent

21. Morocco: down 13 percent

22. Ghana: down 17 percent

23. Kenya: down 27 percent

24. Australia: down 13 percent

25. Nigeria: down more than 30 percent

26. Taiwan: down 15 percent

27. Thailand: down 20 percent

We have not seen numbers like these since 2008, and trillions of dollars of stock market wealth has been wiped out globally.  So the “nothing is happening” crowd is simply dead wrong.  Stocks are already crashing all over the planet.  Just because the big U.S. stock market crash has not happened quite yet does not mean that a major global financial crisis is not happening.

But do you know what is crashing here in this country?

Junk bonds.

At this point, yields on the riskiest junk bonds have risen to levels that we have not seen since the last financial crisis.  As I have discussed repeatedly, yields on junk bonds spiked dramatically just before the stock market crash of 2008, and now it is happening again…

Yield On CCC Bonds - Chart from Federal Reserve

This is precisely the kind of behavior that we would expect to see if a major U.S. stock market crash was imminent.  Personally, I watch the junk bond market very, very closely because it is such a key leading indicator.  And according to Jeffrey Snider, it appears that “something” is starting to cause junk bonds to sell off at an alarming pace…

There isn’t much as far as confirmation, but it increasingly appears as if “something” just hit the triple hooks (CCC) in the junk bond bubble. At least as far as one view of it, Bank of America ML’s CCC implied yield, there was a huge selloff that brought the yield to a new cycle high (low in price) above even the 2011 crisis peak.

But just like in 2008, a lot of people will not heed the warnings because they don’t have the patience to watch long-term trends play out.

We live in a society where we expect constant instant gratification.  We have instant coffee, video on demand and 48 hour news cycles.  If something does not happen immediately, most of us quickly lose patience.

On my other website, I include a lot more stories about things that are trending in the news.  For example, earlier today I wrote about the horrible shootings in San Bernardino, California and I explained why I believe that Islamic terror is now more of a threat to the American people than ever before.

But on this website I like to take a broader view of things.  For months, I have been warning that conditions were perfect for another major global financial crisis, and since that time events have been unfolding in textbook fashion.

And as you can see from the numbers above, we have already entered a new global financial crisis.  If you tried to tell someone in China, Brazil or Saudi Arabia that a financial crisis was not happening, they would just laugh at you.  We need to start learning that the world doesn’t revolve around the United States.

Of course the U.S. is heading for tremendous difficulties as well.  This is something that I covered yesterday.  All of the fundamental economic numbers are absolutely screaming “recession”, and yet most of the “experts” are still forecasting good things for the coming year.

Those that do not learn from history are doomed to repeat it.  None of the problems that caused the crisis the last time around have been fixed, and most of our “leaders” seem blind to what is happening at this moment even though the exact same patterns that played out in 2008 are playing out once again right in front of our eyes.

If you have been waiting for the next global financial crisis, you can stop, because it is already here.

As we move toward the end of 2015, let us hope for the best, but let us also get prepared for the worst.

This Is For The ‘Nothing Is Happening’ Crowd…

Wake Up - Public DomainA lot of people out there expected something to happen in September that did not ultimately happen.  There were all kinds of wild theories floating around, and many of them had no basis in reality whatsoever.  But without a doubt, some very important things did happen in September.  As I warned about ahead of time, we are witnessing the most significant global financial meltdown since the end of 2008.  All of the largest stock markets in the world are crashing simultaneously, and so far the amount of wealth that has been wiped out worldwide is in excess of 5 trillion dollars.  In addition to stocks, junk bonds are also crashing, and Bank of America says that it is a “slow moving trainwreck that seems to be accelerating“.  Thanks to the commodity price crash, many of the largest commodity traders on the planet are now imploding.  I wrote about the death spiral that has gripped Glencore yesterday.  On Tuesday, the stock price of the largest commodity trader in Asia, the Noble Group, plummeted like a rock and commodity trading giant Trafigura appears to be in worse shape than either Glencore or the Noble Group.  The total collapse of any of them could easily be a bigger event than the implosion of Lehman Brothers in 2008.  So I honestly do not understand the “nothing is happening” crowd.  It takes ignorance on an almost unbelievable level to try to claim that “nothing is happening” in the financial world right now.

Within the last 60 days, we have seen some things happen that we have never seen before.

For example, did you know that we witnessed the greatest intraday stock market crash in U.S. history on August 24th?

During that day, the Dow Jones Industrial Average plunged from a high of 16,459.75 to a low of 15,370.33 before rebounding substantially. That intraday point swing of 1,089 points was the largest in all of U.S. history.

Overall, the Dow has down 588.40 points that day.  When you combine that decline with the 530.94 point plunge from the previous Friday, you get a total drop of 1119.34 points over two consecutive trading days.  Never before in history had the Dow fallen by more than 500 points on two trading days in a row.  If that entire decline had fallen within one trading day, it would have been the largest stock market crash in U.S. history by a very wide margin, and everyone would be running around saying that author Jonathan Cahn was right again.

But because this massive decline fell over two consecutive trading days that somehow makes him wrong?

Are you kidding me?

Come on people – let’s use some common sense here.  We are already witnessing the greatest global stock market decline in seven years, and after a brief lull things are starting to accelerate once again.  Last night, stocks in Hong Kong were down 629 points and stocks in Japan were down 714 points.  In the U.S., the Nasdaq has had a string of down days recently, and the “death cross” that has just formed has many investors extremely concerned…

The Nasdaq composite spooked investors on Monday after forming a death cross, a trading pattern that shows a decline in short-term momentum and is often a precursor to future losses.

A death cross occurs when the short-term moving average of a security or an index pierces below the long-term trend, in this case the 50-day moving average breaking through the 200-day moving average.

In the past month, similar chart patterns formed in the S&P 500, Dow and small-cap Russell 2000, but the Nasdaq avoided a death cross formation until Monday.

What we witnessed in September was not “the end” of anything.

Instead, it is just the beginning.

And if you listen carefully, some of the biggest names on Wall Street are issuing some very ominous warnings about what is coming.  For instance, just consider what Carl Icahn is saying…

Danger ahead—that’s the warning from Carl Icahn in a video coming Tuesday.

The activist says low rates caused bubbles in art, real estate and high-yield bonds—with potentially dramatic consequences.

“It’s like giving somebody medicine and this medicine is being given and given and given and we don’t know what’s going to happen – you don’t know how bad it’s going to be. We do know when we did it a few years ago it caused a catastrophe, it caused ’08. Where do you draw the line?”

Even people like Jim Cramer are starting to freak out.  He recently told his audience that “we have a first-class bear market going”…

Jim Cramer, the ex-hedge fund manager and host of CNBC’s show “Mad Money,” has been vocal recently on air, saying repeatedly that he doesn’t like the market now, and last week said “we have a first-class bear market going.” Similarly, Gary Kaltbaum, president of Kaltbaum Capital Management, has been sending out notes to clients and this newspaper for weeks, saying the poor price action of the stock market and many hard-hit sectors, such as energy and the recently clobbered biotech sector, has all the earmarks of a bear market. Over the weekend, Kaltbaum said: “We remain in a worldwide bear market for stocks.”

As I have warned repeatedly, there will continue to be ups and downs.  The stock market is not going to fall every day.  In fact, on some days stocks will absolutely soar.

But without a doubt, we have entered the period of time that I have warned about for so long.  The global financial system is now beginning to unravel, and any piece of major bad news will likely accelerate things.

For instance, the total collapse of Deutsche Bank, Petrobras, Glencore, the Noble Group, Trafigura or any of a number of other major financial institutions that I am currently watching could create mass panic on the global financial stage.

In addition, an unexpected natural disaster that hits a financially important major city or a massive terror attack in the western world are other examples of things that could accelerate this process.

Our world is becoming increasingly unstable, and we all need to learn to expect the unexpected.

The period of relative peace and security that we all have been enjoying for so long is ending, and now chaos is going to reign for a time.

So get prepared while you still can, because there is very little time remaining to do so…

The Stock Markets Of The 10 Largest Global Economies Are All Crashing

Globe InterconnectednessYou would think that the simultaneous crashing of all of the largest stock markets around the world would be very big news.  But so far the mainstream media in the United States is treating it like it isn’t really a big deal.  Over the last sixty days, we have witnessed the most significant global stock market decline since the fall of 2008, and yet most people still seem to think that this is just a temporary “bump in the road” and that the bull market will soon resume.  Hopefully they are right.  When the Dow Jones Industrial Average plummeted 777 points on September 29th, 2008 everyone freaked out and rightly so.  But a stock market crash doesn’t have to be limited to a single day.  Since the peak of the market earlier this year, the Dow is down almost three times as much as that 777 point crash back in 2008.  Over the last sixty days, we have seen the 8th largest single day stock market crash in U.S. history on a point basis and the 10th largest single day stock market crash in U.S. history on a point basis.  You would think that this would be enough to wake people up, but most Americans still don’t seem very alarmed.  And of course what has happened to U.S. stocks so far is quite mild compared to what has been going on in the rest of the world.

Right now, stock market wealth is being wiped out all over the planet, and none of the largest global economies have been exempt from this.  The following is a summary of what we have seen in recent days…

#1 The United States – The Dow Jones Industrial Average is down more than 2000 points since the peak of the market.  Last month we saw stocks decline by more than 500 points on consecutive trading days for the first time ever, and there has not been this much turmoil in U.S. markets since the fall of 2008.

#2 China – The Shanghai Composite Index has plummeted nearly 40 percent since hitting a peak earlier this year.  The Chinese economy is steadily slowing down, and we just learned that China’s manufacturing index has hit a 78 month low.

#3 Japan – The Nikkei has experienced extremely violent moves recently, and it is now down more than 3000 points from the peak that was hit earlier in 2015.  The Japanese economy and the Japanese financial system are both basket cases at this point, and it isn’t going to take much to push Japan into a full-blown financial collapse.

#4 Germany – Almost one-fourth of the value of German stocks has already been wiped out, and this crash threatens to get much worse.  The Volkswagen emissions scandal is making headlines all over the globe, and don’t forget to watch for massive trouble at Germany’s biggest bank.

#5 The United Kingdom – British stocks are down about 16 percent from the peak of the market, and the UK economy is definitely on shaky ground.

#6 France – French stocks have declined nearly 18 percent, and it has become exceedingly apparent that France is on the exact same path that Greece has already gone down.

#7 Brazil – Brazil is the epicenter of the South American financial crisis of 2015.  Stocks in Brazil have plunged more than 12,000 points since the peak, and the nation has already officially entered a new recession.

#8 Italy – Watch Italy.  Italian stocks are already down 15 percent, and look for the Italian economy to make very big headlines in the months ahead.

#9 India – Stocks in India have now dropped close to 4000 points, and analysts are deeply concerned about this major exporting nation as global trade continues to contract.

#10 Russia – Even though the price of oil has crashed, Russia is actually doing better than almost everyone else on this list.  Russian stocks have fallen by about 10 percent so far, and if the price of oil stays this low the Russian financial system will continue to suffer.

What we are witnessing now is the continuation of a cycle of financial downturns that has happened every seven years.  The following is a summary of how this cycle has played out over the past 50 years…

  • It started in 1966 with a 20 percent stock market crash.
  • Seven years later, the market lost another 45 percent (1973-74).
  • Seven years later was the beginning of the “hard recession” (1980).
  • Seven years later was the Black Monday crash of 1987.
  • Seven years later was the bond market crash of 1994.
  • Seven years later was 9/11 and the 2001 tech bubble collapse.
  • Seven years later was the 2008 global financial collapse.
  • 2015: What’s next?

A lot of people were expecting something “big” to happen on September 14th and were disappointed when nothing happened.

But the truth is that it has never been about looking at any one particular day.  Over the past sixty days we have seen absolutely extraordinary things happen all over the planet, and yet some people are not even paying attention because they did not meet their preconceived notions of how events should play out.

And this is just the beginning.  We haven’t even gotten to the great derivatives crisis that is coming yet.  All of these things are going to take time to fully unfold.

A lot of people that write about “economic collapse” talk about it like it will be some type of “event” that will happen on a day or a week and then we will recover.

Well, that is not what it is going to be like.

You need to be ready to endure a very, very long crisis.  The suffering that is coming to this nation is beyond what most of us could even imagine.

Even now we are seeing early signs of it.  For instance, the mayor of Los Angeles says that the growth of homelessness in his city has gotten so bad that it is now “an emergency”…

On Tuesday, Los Angeles officials announced the city’s homelessness problem has become an emergency, and proposed allotting $100 million to help shelter the city’s massive and growing indigent population.

LA Mayor Eric Garcetti also issued a directive on Monday evening for the city to free up $13 million to help house the estimated 26,000 people who are living on the city’s streets.

According to the Los Angeles Homeless Services Authority, the number of encampments and people living in vehicles has increased by 85% over the last two years alone.

And in recent years we have seen poverty absolutely explode all over the nation.  The “bread lines” of the Great Depression have been replaced with EBT cards, and there is a possibility that a government shutdown in October could “suspend or delay food stamp payments”…

A government shutdown Oct. 1 could immediately suspend or delay food stamp payments to some of the 46 million Americans who receive the food aid.

The Agriculture Department said Tuesday that it will stop providing benefits at the beginning of October if Congress does not pass legislation to keep government agencies open.

“If Congress does not act to avert a lapse in appropriations, then USDA will not have the funding necessary for SNAP benefits in October and will be forced to stop providing benefits within the first several days of October,” said Catherine Cochran, a spokeswoman for USDA. “Once that occurs, families won’t be able to use these benefits at grocery stores to buy the food their families need.”

In the U.S. alone, there are tens of millions of people that could not survive without the help of the federal government, and more people are falling out of the middle class every single day.

Our economy is already falling apart all around us, and now another great financial crisis has begun.

When will the “nothing is happening” crowd finally wake up?

Hopefully it will be before they are sitting out on the street begging for spare change to feed their family.

23 Nations Around The World Where Stock Market Crashes Are Already Happening

Globe Earth World Planet Ominous - Public DomainYou can stop waiting for a global financial crisis to happen.  The truth is that one is happening right now.  All over the world, stock markets are already crashing.  Most of these stock market crashes are occurring in nations that are known as “emerging markets”.  In recent years, developing countries in Asia, South America and Africa loaded up on lots of cheap loans that were denominated in U.S. dollars.  But now that the U.S. dollar has been surging, those borrowers are finding that it takes much more of their own local currencies to service those loans.  At the same time, prices are crashing for many of the commodities that those countries export.  The exact same kind of double whammy caused the Latin American debt crisis of the 1980s and the Asian financial crisis of the 1990s.

As you read this article, almost every single stock market in the world is down significantly from a record high that was set either earlier this year or late in 2014.  But even though stocks have been sliding in the western world, they haven’t completely collapsed just yet.

In much of the developing world, it is a very different story.  Emerging market currencies are crashing hard, recessions are starting, and equity prices are getting absolutely hammered.

Posted below is a list that I put together of 23 nations around the world where stock market crashes are already happening.  To see the stock market chart for each country, just click the link…

1. Malaysia

2. Brazil

3. Egypt

4. China

5. Indonesia

6. South Korea

7. Turkey

8. Chile

9. Colombia

10. Peru

11. Bulgaria

12. Greece

13. Poland

14. Serbia

15. Slovenia

16. Ukraine

17. Ghana

18. Kenya

19. Morocco

20. Nigeria

21. Singapore

22. Taiwan

23. Thailand

Of course this is just the beginning.  The western world is going to feel this kind of pain as well very soon.  I want to share with you an excerpt from an article that just appeared in the Telegraph entitled “Doomsday clock for global market crash strikes one minute to midnight as central banks lose control“.  You see, the Telegraph is not just one of the most important newspapers in the UK – it is truly one of the most important newspapers in the entire world.  When it speaks on financial matters, millions of people listen very carefully.  So for the Telegraph to declare that the countdown to a “global market crash” is “one minute to midnight” is a very, very big deal…

When the banking crisis crippled global markets seven years ago, central bankers stepped in as lenders of last resort. Profligate private-sector loans were moved on to the public-sector balance sheet and vast money-printing gave the global economy room to heal.

Time is now rapidly running out. From China to Brazil, the central banks have lost control and at the same time the global economy is grinding to a halt. It is only a matter of time before stock markets collapse under the weight of their lofty expectations and record valuations.

I encourage you to read the rest of that excellent article right here.  It contains lots of charts and graphs, and it discusses many of the exact same things that I have been hammering on for months.

When one of the newspapers of record for the entire planet starts sounding exactly like The Economic Collapse Blog, then you know that it is late in the game.

Others are sounding the alarm about an imminent global financial crash as well.  For example, just consider what Egon von Greyerz recently told King World News…

Eric, I fear that this coming September – October all hell will break loose in the world economy and markets. A lot of factors point to that, both fundamental and technical indicators and this indicates that we could have a number of shocks this autumn.

Sadly, most investors will hold stocks, bonds and property and will see any decline in value as an opportunity. It will be a long time and a very big fall before they realize that the system will not help them this time because the central bankers have run out of ammunition to save the global financial system one more time. Yes, we will see more massive money printing, but it will just make things worse. And at some stage, which could be quite soon, real fear will set in, a fear of a magnitude the world has not experienced before.

Hmm – there is another example of someone talking about September.  It is funny how often that month keeps coming up.

And of course most of the major stock market crashes in U.S. history have been in the fall.  Just go back and take a look at what happened in 1929, 1987, 2001 and 2008.

The “smart money” has been pulling their money out of stocks for quite a while now, and at this point a lot of others have hopped on the bandwagon.  The following comes from CNBC…

The flight of investor money from U.S. stocks has turned into a stampede.

In fact, the $78.7 billion leaving domestic equity-focused funds has been worse in 2015 than it was even during the financial crisis years, when the S&P 500 tumbled some 60 percent, according to data released Friday by Morningstar. The total is the highest since 1993.

Domestic equity funds surrendered $20.4 billion in July alone and have seen $158.6 billion in redemptions over the past 12 months. Even a strong flow of money into passively managed exchange-traded funds has been unable to offset the stream to the exit among retail investors, who generally focus more on mutual funds than ETFs.

A global financial crisis has already begun.

So those that were claiming that one would not happen in 2015 are already wrong.

Over the coming months we will find out how bad it will ultimately be.

Sometimes I get criticized for talking about these things.  There are a few people out there that don’t like all of the “doom and gloom” that I discuss on my website.  Apparently it is a bad thing to talk about the things that really matter and we should all just be “keeping up with the Kardashians” instead.

I consider myself just to be another watchman on the wall.  From our spots on the wall, watchmen such as myself all over the nation are sounding the alarm about what we clearly see coming.

If we saw what was coming and we did not warn the people, their blood would be on our hands.  But if we do warn the people, then we have done our duty.

Every day I just do the best that I can with what I have been given.  And there are many others just like me that are doing exactly the same thing.

Those that do not like the warning message are going to feel really stupid when things start falling apart all around them and they finally realize how wrong they truly were.

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