Equity 1 Group
Pushing back the frontiers of economic ignorance and restoring sound financial foundations, one family at a time.

Sep
22

ZeroHedge  |  by SprottMoney

U.S. Big Banks: A Culture of Crime - Jeff Nielson

Organized crime. This phrase is now a precise synonym for big-banking in the United States. These Big Banks commit big crimes; they commit small crimes. They cheat their own clients; they swindle outsiders. They break virtually every financial law on the books. What do all these crimes have in common? The Big Banks commit all these crimes again and again and again – with utter impunity.

These fraud factories commit their serial mega-crimes, year after year, because the Big Banks know that they will never, ever be punished. On rare occasions, their crimes have been so egregious that U.S. ‘justice’ officials could no longer pretend to be oblivious to them. In such cases, there was a token prosecution, there was a settlement where the law-breaking banks didn’t even have to acknowledge their own criminality, and there was a microscopic fine – which didn’t even force the felonious financial institutions to disgorge all of their profits from these crimes.

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Sep
22

SovereignMan  | Simon Black

US-Debt-Crisis

This isn’t supposed to be happening.

The financial crisis is years behind us. The economy is supposedly on solid footing. The government keeps gushing about how much tax revenue they’re collecting.

Usually when government debt expands so rapidly it’s because they’re waging war, fighting a major recession, or financing some serious infrastructure projects.

But none of these things are happening.

Think about it– yesterday I told you that the debt is now $19.5 trillion. The debt hit $18.5 trillion in November of last year… meaning that they added $1 trillion to the national debt in just 10 months.

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Sep
22

ZeroHedge  |  by Charles Hugh-Smith via OfTwoMinds blog

I consider it self-evident that we are in the third and final stage of self-serving Imperial decay.

Though Edward Luttwak’s The Grand Strategy of the Roman Empire: From the First Century CE to the Third is not specifically on the rise and fall of empires, it does sketch out the three stages of Empire.

Here is the current context of the discussion of Imperial lifecycles: the U.S. defense budget is roughly the same size as the rest of the world’s defense spending combined:

Luttwak describes the first stage of expansion thusly:

“With brutal simplicity, it might be said that with the first system the Romans of the republic conquered much to serve the interests of the few, those living in the city–and in fact still fewer, those best placed to control policy.”

The second stage spread the benefits of Empire much more broadly:

“During the first century A.D., Roman ideas evolved toward a much broader and altogether more benevolent conception of empire… men born in lands far from Rome could call themselves Roman and have their claim fully allowed, and the frontiers were efficiently defended to defend the growing prosperity of all, and not merely the privileged.”

The third stage is one of rising inequality:

“In the wake of the great crisis of the third century, the provision of security became an increasingly heavy charge on society, a charge unevenly distributed, which could enrich the wealthy and ruin the poor. The machinery of empire now became increasingly self-serving, with its tax collectors, administrators and soldiers of much greater use to one another than to society at large.

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Sep
22

ZeroHedge  |  Tyler Durden

We find it surprising how, having covered the unprecedented growth in US corporate debt over the past few years, which has more than doubled from $2 trillion at around the time of the financial crisis to approximately $6 trillion currently…

… resulting in a debt/ETBIDA ratio that has never been higher…

… some are still amazed by what is taking place on corporate America’s balance sheets.

Overnight, one person warning how all this will end is TCW Group’s Tad Rivelle, who is the latest to observe that “corporate leverage, which has exceeded levels reached before the 2008 financial crisis, is a sign that investors should start preparing for the end of the credit cycle.”

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Sep
22

ZeroHedge  |  by David Stockman via Contra Corner blog

You can’t find lazier people than in the mainstream financial press, but their exuberant cheerleading about the purported 5.2% gain in the real median household income in 2015 surely was a new high in mendacity. And we are not talking about the junior varsity here: The Washington Post was typical with a headline of superlatives followed by even more exuberance in the text:

U.S. household incomes soared in 2015, recording biggest gain in decades………The data represents the clearest evidence to date that the nation’s long, slow and topsy-turvy economic recovery has finally begun to deliver prosperity for wide swaths of workers.

The self-evident fact is that the median household couldn’t have had an after-inflation income gain of 5.2% in 2015. There is not a single data point in the mountains of “incoming” economic data that is consistent with that proposition. Yet nothing in the Post story, or any other mainstream coverage, even hints that the Census Bureau’s whopper isn’t on the level.

In the context of what was by all accounts a sputtering economy during 2015, in fact, the Census Bureau unleashed the largest year-over-year gain in recorded history. But not a single reporter smelled a fish.

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Sep
21

NewsMax  |

Image result for gold images

Gold will likely soar to a record within five years as asset bubbles burst in everything from bonds to credit and equities, forcing investors to find a haven, according to Old Mutual Global Investors’ Diego Parrilla.

The metal is at the start of a multi-year bull run with a “few thousand dollars of upside” in a world of “monetary policy without limits” where central banks print lots of money and low or negative interest rates prevail, said Parrilla, who joined the firm as managing director of commodities last month. He’s worked at Goldman Sachs Group Inc. and Bank of America Merrill Lynch.

“As some of the excesses in other asset classes get unwound, gold will perform very strongly,” said 43-year-old Parrilla, who has almost 20 years experience in precious-metals markets. The “perfect storm scenario will mean that gold will perform best when other classes are doing worst.”

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Sep
20

ZeroHedge  |  Jim Clifton, Chairman & CEO at Gallup

I’ve been reading a lot about a “recovering” economy. It was even trumpeted on Page 1 of The New York Times and Financial Times last week.

Image result for great depression images

I don’t think it’s true.

The percentage of Americans who say they are in the middle or upper-middle class has fallen 10 percentage points, from a 61% average between 2000 and 2008 to 51% today.

Ten percent of 250 million adults in the U.S. is 25 million people whose economic lives have crashed.

What the media is missing is that these 25 million people are invisible in the widely reported 4.9% official U.S. unemployment rate.

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Sep
20

SovereignMan  | Simon Black

A few days ago, the federal debt of the United States rather quietly and unceremoniously passed the $19.5 trillion mark.

shutterstock_165763190

And while that figure may seem absolutely confounding, what’s even more alarming is how rapidly the US government is racking up this debt.

In fact, for the 2016 fiscal year that ends in just ten more days, the US government’s debt growth of $1.36 trillion is on track to be the third biggest annual increase ever.

The only two years in all of US history that posted higher US debt growth were 2010 and 2011– the peak of the financial crisis.

Even more acutely, last month the US federal debt grew by $151.5 billion.

Not counting the financial crisis, and a few anomalous months following a debt ceiling reset, August 2016 was the single biggest expansion of US debt EVER.

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Sep
20

SovereignInvestor  |  by JL Yastine

Several noted economists and distinguished investors are warning of a stock market crash.

Jim Rogers, who founded the Quantum Fund with George Soros, went apocalyptic when he said, “A $68 trillion ‘Biblical’ collapse is poised to wipe out millions of Americans.”

Mark Faber, Dr. Doom himself, recently told CNBC that “investors are on the Titanic” and stocks are about to “endure a gut-wrenching drop that would rival the greatest crashes in stock market history.”

And the prophetic economist Andrew Smithers warns, “U.S. stocks are now about 80% overvalued.”

Smithers backs up his prediction using a ratio which proves that the only time in history stocks were this risky was 1929 and 1999. And we all know what happened next. Stocks fell by 89% and 50%, respectively.

Even the Royal Bank of Scotland says the markets are flashing stress alerts akin to the 2008 crisis. They told their clients to “Sell Everything” because “in a crowded hall, the exit doors are small.”

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Sep
20

ZeroHedge  |  Submitted by Charles Hugh-Smith via OfTwoMinds

The priesthood’s insane obsession with forcing people to spend their savings by punishing savers with ZIRP/NIRP has failed spectacularly for a simple reason: it completely misunderstands human psychology.

Let’s start with a simple chart of the Fed Funds Rate, which the Federal Reserve has pinned near zero for years. This Zero Rate Interest Policy (ZIRP) is the god the PhD economists in the Fed and other central banks worship as the supreme force in the Universe, along with its even more severe sibling god, NIRP (negative interest rate policy), which demands that banks and depositors must pay for the privilege of holding cash.
Precisely what have ZIRP and NIRP fixed in the global economy? The short answer is “nothing.” Instead of fixing what’s broken, ZIRP and NIRP have pushed a broken system further along the path of self-destruction.

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