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

Jun
14

ZeroHedge  |  Tyler Durden

Another “pre-crash” culprit emerged after he warned that digital currencies such as bitcoin would worsen the next financial crisis.

When global financial markets crash, it won’t be just “Trump’s fault” (and perhaps the quants and HFTs who switch from BTFD to STFR ) to keep the heat away from the Fed and central banks for blowing the biggest asset bubble in history: according to the head of the German central bank, Jens Weidmann, another “pre-crash” culprit emerged after he warned that digital currencies such as bitcoin would worsen the next financial crisis.

As the FT reports, speaking in Frankfurt on Wednesday the Bundesbank’s president acknowledged the creation of an official digital currency by a central bank would assure the public that their money was safe. However, he warned that this could come at the expense of private banks’ ability to survive bank runs and financial panics.

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Jun
14

SovereignMan  |  Simon Black

So basically an insolvent government and insolvent large banks are trying to figure out how to bail out insolvent smaller banks.

Here’s the perfect example of how insane our financial system has become.

It was announced yesterday that, after a 24-hour white-knuckled ride, Spanish banking giant Banco Popular had been sold to Banco Santander for the price of just 1 euro.

Note- that’s 1 euro in TOTAL. Not 1 euro per share.

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Jun
14

SovereignMan  |  Simon Black

Whenever people starting buying up some item or asset exclusively because they expect to sell it quickly after a rapid price increase, and not for the asset or item’s originally intended purpose, you can be certain that you are in a bubble.

In 1559 while on a trip to southern Bavaria, Swiss scientist Conrad Gesner spied a curious flower in the garden of a diplomat in Augsburg.

The flower was called a tulip, derived from the Persian word dulband, meaning “turban,” which described its conspicuous shape.

Gesner was intrigued.

He asked the man who owned the flower about its origins and determined that it came from Constantinople in the Ottoman Empire, modern-day Istanbul.

Soon the tulip began spreading across Western Europe.

It was rare, something that only the very wealthy could afford to import directly from Constantinople.

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Jun
14

SovereignMan  |  Simon Black

In other words, only 35% of the companies which make up 80% of American businesses are profitable.

The Federal Reserve in the United States just released a new report showing that “Total Household Wealth” in the United States has reached a record $94.8 trillion.

That’s an impressive figure.

Even more impressive is that Total Household Wealth has increased by $40 trillion since the lows of the Great Recession in 2009.

No doubt there’s probably a multitude of central bankers and bureaucrats toasting their success in having engineered such magnificent prosperity.

And it’s certainly an achievement worth celebrating. As long as you don’t look too closely at the data.

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Jun
14

SovereignMan  |  Simon Black

The Federal Reserve’s most recent report on “Assets and Liabilities of Commercial Banks in the United States” published last Friday showed a continuing trend in the erosion of bank safety.

What I’m about to tell you isn’t some wild conspiracy. Or fake news.

It’s raw fact, based on publicly available data from the US Federal Reserve.

This data shows a very simple but concerning trend: banks in the United States are becoming less safe. Again.

And they’re doing it on purpose. Again.

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Jun
14

SovereignMan  |  Simon Black

This one is almost too ridiculous to believe.

Recently a new bill was introduced on the floor of the US Senate entitled, pleasantly,

“Combating Money Laundering, Terrorist Financing, and Counterfeiting Act of 2017.”

You can probably already guess its contents.

Cash is evil.

Bitcoin is evil.

Now they’ve gone so far to include prepaid mobile phones, retail gift vouchers, or even electronic coupons. Evil, evil, and evil.

These people are certifiably insane.

Among the bill’s sweeping provisions, the government aims to greatly extend its authority to seize your assets through “Civil Asset Forfeiture”.

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Jun
07

Pop goes another currency!

ZeroHedge  |  Tyler Durden

The Qatari Riyal plunged to record lows (and forward FX markets indicate the peg is doomed)

As Bloomberg reports Saudi Arabia’s central bank has ordered lenders in the country not to increase their exposure to any Qatari clients amid the worst crisis in relations among the Gulf Arab monarchies in decades.

Image result for saudi riyal image

The Saudi Arabian Monetary Agency also told banks licensed in the country that they should not process any payments denominated in Qatari riyals, the people said, asking not to be identified because the information is private.

The order to refrain from increasing exposure to Qatar is being applied to include treasury investments, loans, letters of credit and trade-finance facilities, the people said.

Saudi Arabia is among countries including the United Arab Emirates, Egypt and Bahrain, that have blocked transport routes with Qatar, accusing the country ofdestabilizing the region through supporting proxies of Shiite Muslim Iran and the Sunni militants of al-Qaeda and Islamic State.

Some banks in Saudi Arabia, the U.A.E. and Bahrain have already begun cutting their exposure to Qatar, other people said on Wednesday.

Jun
07

ZeroHedge  |  Tyler Durden

“If you think this has a happy ending, you haven’t been paying attention…”

…warns MINT Partners’ Head of Capital Markets Bill Blain, as he reflects on what just happened in Europe (that US equities seem happy to brush off as yet another fleshwound to global instability).

There is a rule in Financial Institutions that any bank that calls itself “popular” generally isn’t. This was proved last night. But, congratulations if you were a holder of Spain’s Banco Popular’s Senior Debt – they did a Zebedee “boing!” on the basis last night’s last minute Santander rescue makes the bonds money good. Read the rest of this entry »

Jun
07

BloombergInvest  |

U.S. markets are at their highest risk levels since before the 2008 financial crisis.

Image result for financial crisis images

Speaking at the Bloomberg Invest summit in New York, Bill Gross (of the recently merged Janus Henderson) who may or may not have been talking his bond book, issued a loud warning to traders saying U.S. markets are at their highest risk levels since before the 2008 financial crisis “because investors are paying a high price for the chances they’re taking.” Well, either that, or simply ignoring the possibility of all ETFs having to sell at once.

“Instead of buying low and selling high, you’re buying high and crossing your fingers,” Gross said Wednesday quoted by Bloomberg.

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Jun
07

PhoenixCapital  |  Graham Summers

The number of S&P 500 companies reporting negative earnings is rising rapidly.

Why does this matter?

It matters because this usually signals right before a stock market peak.

Below is a chart illustrating the percentage of S&P 500 companies reporting negative earnings running back to 1999.

As you can see, we are now at levels that have usually occurred just before stock market peaks (the last two times we were at these levels were 2007 and 2000, respectively).

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