from McAlvany Financial:
by Pam Martens and Russ Martens, Wall St On Parade:
To understand how the U.S. central bank, known as the Federal Reserve, is influencing the froth of the stock market, you need to take a few moments to understand the interaction of bond yields with stock prices. Sophisticated investors who predominate in the markets compare the yield on bonds to the cash dividend yield on stocks to determine which is a better value. Following the financial crash of 2008, the Federal Reserve began buying up Treasury bonds and mortgage-backed bonds in the marketplace to the overall tune of more than $3 trillion. This has driven down bond yields and provided an artificial boost to the stock market.
The Fed’s assets swelled from $914.8 billion at the end of 2007 to $4.5 trillion in 2014 from its bond buying program. In just the single year of 2013 the Fed’s assets mushroomed by a staggering $1 trillion — from $2.9 trillion at the end of 2012 to $4 trillion at the end of 2013, according to the audited financial statement of the Fed’s books. As of October 25, 2017, its assets remain in the $4.5 trillion arena, at $4.461 trillion.
The Fed’s active involvement in messing with the stock market as a fair stock pricing mechanism through its massive purchases of bonds was quaintly called Quantitative Easing (QE) and the public was treated to three doses of it: QE1, QE2 and QE3.
Since 2011, the Fed has been jawboning about how it was going to normalize its balance sheet back to something resembling pre-crisis days. It actually began to cut back its bond purchases by shrinking the amount of its maturing bonds that it will roll over into new bond purchases in October of 2017. But its scheduled cuts are so small and gradual that we are not seeing any material shrinkage in its assets.
During Fed Chair Janet Yellen’s September 17, 2014 press conference, in response to a question from Ylan Mui of the Washington Post, Yellen said: “If we were only to shrink our balance sheet by ceasing reinvestments, it would probably take—to get back to levels of reserve balances that we had before the crisis—I’m not sure we will go that low, but we’ve said that we will try to shrink our balance sheet to the lowest levels consistent with the efficient and effective implementation of policy—it could take to the end of the decade to achieve those levels.”
In 2014, the end of the decade would have been 2020. It’s now 2018 and we’re looking at another half decade before the Fed’s balance sheet would normalize under the current schedule. That’s a very, very long time to provide spiked punch to a tipsy stock market.
The Goldman Sachs overlords who have so thoroughly infused themselves into the Donald Trump administration (the Presidential candidate who promised a draining of the Washington swamp) have figured out a way to get another round of cheap money. Instead of calling it QE4 and getting it from the Fed, it’s being called a corporate tax cut and its coming from the American public who will be squeezed in other areas to pay for it. Jamie Dimon, the Chairman and CEO of JPMorgan Chase, quickly recognized it for what it was, stating “think of it as a QE4” at an Axios event in Ann Arbor, Michigan in December.
Republicans have been peddling the tax cut as a boon to the economy. That’s not what’s going to happen. U.S. corporations and, particularly, the biggest Wall Street banks are going to use the extra money to continue buying back their own company’s stock, boosting the bank CEOs’ own stock options and enriching their shareholders to the detriment of business and job creation.
On July 31 of last year, Thomas Hoenig, the Vice Chairman of the Federal Deposit Insurance Corporation (FDIC), sent a stunning letter to the Chair and Ranking Member of the U.S. Senate Banking Committee. Hoenig explained that the 10 largest banks in the country “will distribute, in aggregate, 99 percent of their net income on an annualized basis,” by paying out dividends to shareholders and buying back excessive amounts of their own stock. If those 10 banks had retained a larger share of the earnings they earmarked for dividends and share buybacks in 2017, said Hoenig, they would have been able “to increase loans by more than $1 trillion, which is greater than 5 percent of annual U.S. GDP.”
Hoenig included a chart showing payouts on a bank-by-bank basis. Highlighted in yellow on Hoenig’s chart is the fact that four of the big Wall Street banks are set to pay out more than 100 percent of earnings: Citigroup 127 percent; Bank of New York Mellon 108 percent; JPMorgan Chase 107 percent and Morgan Stanley 103 percent.
Hoenig adds that if just the share buybacks were retained by the banks instead of being paid out, the banks could “increase small business loans by three quarters of a trillion dollars or mortgage loans by almost one and a half trillion dollars.”
Stock buybacks also perform another magic trick for Wall Street bank CEOs like Jamie Dimon whose compensation is based on overall performance. By shrinking the number of shares outstanding through buybacks, it makes the bank’s per share earnings look more robust because they are spread over a smaller number of shares.
Read More @ WallStOnParade.com
by Martin Armstrong, Armstrong Economics:
COMMENT: Mr. Armstrong; I live in Germany. I wanted to send my father €200 for Christmas. I had to prove where the money came from. It does seem as if there is a major gap between those trading the euro for big banks and the people. I left Romania for freedom. Everything that I fled from has seemed to follow me to the West. Those who cheer the rise of the euro seem oblivious to the reality on the street. We have no real government in place here since nobody won a majority. The clash between freedom and oppression is playing out in silence. I fear this will just explode all of a sudden as it did behind the Iron Curtain.
REPLY: You are not alone. I have several Russian, Hungarian, and Ukrainian friends who all express the same concerns. The fact that you fled to freedom and then see the very aspects of government that made you flee in the first place have taken hold in the West is all part of the cycle. This is simply how Empires, Nations, and Citystates collapse. They are always the same – a constant search for more power to retain their control. Then it all snaps. That comes typically when a government can no longer feed its own workforce to keep the people in check.
Emperor Phocas (602-610) persecuted the Aristocrats (rich) seeking taxation causing capital to go into hiding and the VELOCITY of money to decline. His reign did more than any other to begin the process of a significant decline of the Byzantine Empire. His tyrannical treatment of wealth led to a rebellion that began in North Africa by the exarch of Carthage, Heraclius in 608AD, who had been a leading and respected general under the previous emperor Maurice Tiberius (582–602).
This tax rebellion that began in Carthage, spread throughout the provinces. The funds were thereby raised to put together a considerable effort under Heraclius and his son. This major effort gathered a massive fleet that sailed toward the capital Constantinople. When they reached Constantinople, the gates were opened and Phocas was handed over. He was promptly executed being abandoned, and his statue he had constructed in the Hippodrome was now publicly burned. The young Heraclius was crowned by the Patriarch and began a new dynasty as Heraclius (610-641AD). His father did NOTassume the role of co-emperor showing his motives were to simply save his nation.
What most people do not know about history is the fall of government typically comes from tax rebellions. Michael IV the Paplagonian (1034-1041AD) raised taxes excessively setting in motion the collapse in VELOCITY of money once again as people hoarded their wealth creating the essential element to the destruction of an economy as you see in Europe today. Once capital begins to hoard and hide from the government tax collectors, the beginning of the end appears. In the case of Byzantium, this was set in motion by a tax hike and aggressive tax collection. The Slav population of the Balkans rebelled against the taxation. Michael IV himself was present to put down the tax rebellion oppressing the people and pillaging what they had.
Read More @ ArmstrongEconomics.com
All hell is breaking loose in Washington D.C. tonight after a four-page memo detailing extensive FISA court abuse was made available to the entire House of Representatives Thursday. The contents of the memo are so explosive, says Journalist Sara Carter, that it could lead to the removal of senior officials in the FBI and the Department of Justice and the end of Robert Mueller’s special counsel investigation.
These sources say the report is “explosive,” stating they would not be surprised if it leads to the end of Robert Mueller’s Special Counsel investigation into President Trump and his associates. –Sara Carter
A source close to the matter tells Fox News that “the memo details the Intelligence Committee’s oversight work for the FBI and Justice, including the controversy over unmasking and FISA surveillance.” An educated guess by anyone who’s been paying attention for the last year leads to the obvious conclusion that the report reveals extensive abuse of power and highly illegal collusion between the Obama administration, the FBI, the DOJ and the Clinton Campaign against Donald Trump and his team during and after the 2016 presidential election.
Lawmakers who have seen the memo are calling for its immediate release, while the phrases “explosive,” “shocking,” “troubling,” and “alarming” have all been used in all sincerity. One congressman even likened the report’s details to KGB activity in Russia. “It is so alarming the American people have to see this,” Ohio Rep. Jim Jordan told Fox News. “It’s troubling. It is shocking,” North Carolina Rep. Mark Meadows said. “Part of me wishes that I didn’t read it because I don’t want to believe that those kinds of things could be happening in this country that I call home and love so much.”
Rep. Peter King, R-N.Y., offered the motion on Thursday to make the Republican majority-authored report available to the members.
“The document shows a troubling course of conduct and we need to make the document available, so the public can see it,” said a senior government official, who spoke on condition of anonymity due to the sensitivity of the document. “Once the public sees it, we can hold the people involved accountable in a number of ways.”
The government official said that after reading the document “some of these people should no longer be in the government.” –Sara Carter
Immediately #ReleaseTheMemo #FISAMemo & ALL relevant material sourced in it. Every American needs to know the truth! We wouldn't be revealing any sources & methods that we shouldn't; only feds' reliance on bad sources & methods.
— Lee Zeldin (@RepLeeZeldin) 19 January 2018
Read More @ ZeroHedge.com
by Peter Schiff, SchiffGold:
Global wealth increased to a new record of $280 trillion in 2017, according to Credit Suisse Global Wealth Report 2017. That seems like pretty good news until you consider global debt is increasing nearly three times as fast.
According to the Wealth Report, total global wealth rose at a rate of 6.4%, the fastest pace since 2012 and reached USD 280 trillion, a gain of USD 16.7 trillion. This reflected widespread gains in equity markets matched by similar rises in non-financial assets, which moved above the pre-crisis year 2007’s level for the first time this year. Wealth growth also outpaced population growth, so that global mean wealth per adult grew by 4.9% and reached a new record high of USD 56,540 per adult.”
Increasing global wealth is one of the trends the World Gold Council identifiesas a positive for the gold market in the next year.
That’s all well and good. But we have to also look at the other side of the equation.
As ZeroHedge reported, the Institute of International Finance recently released its latest global debt analysis. It reported that global debt rose to a record $233 trillion at the end of Q3 2017. That is split up between $63 trillion in government debt, $58 trillion in financial sector corporate debt, $68 trillion in non-financial sector corporate debt, and $44 trillion in household indebtedness.
In just nine months, there was an increase of $16 trillion in worldwide debt.
According to the IIF, private non-financial sector debt hit all-time highs in Canada, France, Hong Kong, South Korea, Switzerland and Turkey.
Last summer, US Global Investors CEO Frank Holmes called global debt “the mother of all bubbles.” We also had a report from the Bank of International Settlements saying worldwide debt may actually be understated by $13 trillion.
Of course, all of this debt has ramifications. ZeroHedge put it this way.
Still, while global GDP has enjoyed a period of accelerating growth, this may soon come to an end even as debt levels continue to rise. Meanwhile, the debt pile could act as a brake on central banks trying to raise interest rates, given worries about the debt servicing capacity of highly indebted firms and government, the IIF analysts wrote.”
The mainstream loves to focus on assets and wealth growth, but it doesn’t talk much about debt. They should because they are both important factors in the equation.
Net wealth = Assets – Debt
So, you really can’t talk about wealth without talking about debt. SRSrocco took a look at both factors in the equation.
Even if global wealth surged in 2017, so did world debt. According to the data, global wealth increased by $16.7 trillion in 2017 while global debt expanded $16 trillion… nearly one to one. However, this is only part of the story. If we look at the increase in total world debt and total global wealth over the past 20 years, we can see a troubling sign, indeed: Since 1997, total global debt increased from $50 trillion to $233 trillion compared to the rise in global wealth from $120 trillion to $280 trillion.
When you do the math, you find global debt has increased 366% vs. 133% increase in global wealth since 1997. That means net wealth was $70 trillion in 1997 versus $47 trillion in 2017.
Read More @ SchiffGold,com
The FBI has asked retired Australian policeman-turned investigative journalist, Michael Smith, to provide information he has gathered detailing multiple allegations of the Clinton Foundation receiving tens of millions of mishandled taxpayer funds, according to LifeZette.
“I have been asked to provide the FBI with further and better particulars about allegations regarding improper donations to the CF funded by Australian taxpayers,” Smith told LifeZette.
Of note, the Clinton Foundation received some $88 million from Australian taxpayers between 2006 and 2014, reaching its peak in 2012-2013 – which was coincidentally (we’re sure) Australian Prime Minister Julia Gillard’s last year in office.
Hillary Clinton and former Australian PM Julia Gillard
Smith names several key figures in his complaints of malfeasance, including Bill and Hillary Clinton and multiple Australian government officials – including senior diplomat Alexander Downer, whose conversation with Trump aide George Papadopoulos that Russia had ‘dirt’ on Hillary Clinton allegedly launched the Trump-Russia investigation (as opposed to the Fusion GPS dossier, of course).
Within hours of the NYT publication, the paper was immediately shredded as the information Papadopoulous told Downer was already public.
The materials Smith is giving to the FBI focus on a 2007 memorandum of understanding (MOU) between the Clinton Foundation’s HIV/AIDs Initiative (CHAI) and the Australian government.
Smith claims the foundation received a “$25M financial advantage dishonestly obtained by deception” as a result of actions by Bill Clinton and Downer, who was then Australia’s minister of foreign affairs.
Also included in the Smith materials are evidence he believes shows “corrupt October 2006 backdating of false tender advertisements purporting to advertise the availability of a $15 million contract to provide HIV/AIDS services in Papua New Guinea on behalf of the Australian government after an agreement was already in place to pay the Clinton Foundation and/or associates.”-Lifezette
As a reminder, the Australian government announced that they would stop pouring millions of dollars into accounts linked to the Clinton charities in November of 2016 – right after Hillary Clinton lost the election.
The federal government confirmed to news.com.au it has not renewed any of its partnerships with the scandal-plagued Clinton Foundation, effectively ending 10 years of taxpayer-funded contributions worth more than $88 million.
Despite that, the official website for the charity shows contributions from both AUSAID and the Commonwealth of Australia, each worth between $10 million and $25 million.
(Norway, coincidentally, also reduced its $20 million / year donations to the Clinton Foundation right after Hillary’s loss.)
A third complaint by Smith revolves around a “$10 million financial advantage dishonestly obtained by deception between April 1, 2008, and Sept. 25, 2008, at Washington, D.C., New York, New York, and Canberra Australia involving an MOU between the Australian government, the “Clinton Climate Initiative,” and the purported “Global Carbon Capture and Storage Institute Inc.”
Read More @ ZeroHedge.com
by Darius Shahtahmasebi, The Anti Media:
Russia possesses an underwater nuclear drone capable of carrying a 100-megaton nuclear warhead, a recently leaked draft of the Pentagon’s Nuclear Posture Review (NPR) has revealed.
The weapon, known as the autonomous underwater vehicle “AUV,” is featured in a chart that lays out Russia’s multiple nuclear delivery vehicles in the draft paper. Its official name is the Ocean Multipurpose System Status-6. According to the draft report, the underwater drone has the potential to devastate U.S. ports and harbors. It has a range of 10,000 km, can descend 1 km below sea level, and can also reach a top speed of more than 56 knots (over 64 miles per hour).
Russia has developed and tested a nuclear-capable underwater drone called Ocean Multipurpose System Status-6.
The draft NPR, which was originally published by the Huffington Post, alleges that the U.S. has been left exposed because Russia has continued to develop nuclear weapons since the end of the Cold War. The draft paper appears to suggest that the U.S. has reduced its role in producing nuclear weapons.
“Russia’s strategic nuclear modernisation has increased and will continue to increase its warhead delivery capacity, and provides Russia with the ability to rapidly expand its deployed warhead numbers,” the draft paper states.
“In addition to modernising ‘legacy’ Soviet nuclear systems, Russia is developing and deploying new nuclear warheads and launchers…These efforts include multiple upgrades for every leg of the Russian nuclear triad of strategic bombers, sea-based missiles, and land-based missiles,” the NPR also stated.
“Russia is also developing at least two new intercontinental range systems, a hypersonic glide vehicle and a new intercontinental nuclear-armed undersea autonomous torpedo.”
This reference to an “autonomous torpedo” is allegedly the first time the Pentagon has confirmed the existence of such a weapon.
According to Newsweek, in response, the Pentagon released the following statement, which appeared to confirm the draft’s authenticity:
“Our discussion has been robust and several drafts have been written. However, the Nuclear Posture Review has not been completed and will ultimately be reviewed and approved by the President and the Secretary of Defense. As a general practice, we do not discuss pre-decisional, draft copies of strategies and reviews.”
According to Defense News, Russia reportedly tested the AUV in November 2016. Defense News also noted that the NPR offers “no sign that the Pentagon is interested in developing unmanned undersea vehicles capable of delivering a nuclear weapon.”
In reality, the draft paper provides a foundation for Donald Trump’s long-standing desire to be able to use nuclear weapons. After once reportedly asking three times in a meeting, “If we have nuclear weapons, why don’t we use them?” the draft paper has surfaced amid the Trump administration’s active efforts to try to remove the constraints that prevent the use of nuclear weapons.
Defense News helps us further understand the true motive behind the report:
Read More @ TheAntiMedia.com
by Shepard Ambellas, Intellihub:
LAS VEGAS (INTELLIHUB) — Photographic evidence available in the public domain suggests that the dead guy in the leaked photos is not Stephen Paddock.
No this is not a joke.
Let’s take a closer look.
Here are a few pictures of the real Stephen Paddock.
In the following picture, Stephen Paddock is pictured with his friend Lisa Crawford who has nothing but good things to say about Paddock.
Here is another picture of the real Stephen Paddock. Take a close look at his ears in each picture. Look at how his earlobes connect to his face, how smooth the transition is.
Now look at the earlobes on the dead guy. They have a distinct curl to them.
Read More @ Intellihub.com
by Geoffrey Grider, Now The End Begins:
TURKISH PRESIDENT RECEP TAYYIP ERDOGAN WILL VISIT POPE FRANCIS AT THE VATICAN NEXT MONTH FOR TALKS LIKELY TO FOCUS ON THE US RECOGNITION OF JERUSALEM AS THE CAPITAL OF ISRAEL.
“And it shall come to pass in that day, that I will seek to destroy all the nations that come against Jerusalem.” Zechariah 12:9 (KJV)
EDITOR’S NOTE: When it became apparent that Donald Trump was going to officially recognize Jerusalem as the capital of Israel, Pope Francis called for urgent prayer that Jerusalem would remain divided and out of Israeli control. Now Turkish president Erdogan will meet with the anti-Israel pope in secret closed-door meetings to discuss what the Muslim response should be. Just as the Vatican had signed concordats with Hitler to help bring the Nazis to power and protect them, they are now aligning with the Muslims to conspire to give control of Jerusalem to the Palestinians.
The Turkish leader and head of the Roman Catholic Church both strongly opposed the move announced by US President Donald Trump at the end of last year.
Erdogan called Trump’s recognition of Jerusalem a “bomb” which would inflame the Middle East and his top diplomat called for the recognition of Jerusalem as the capital of Palestine.
Erdogan’s first trip to the tiny state will be on February 5, the Vatican said. It follows phone calls between the two leaders who share concerns over the recognition of Israeli rights to Jerusalem and agree that the status quo should remain.
The Argentine-born pope met Erdogan during his trip to Turkey in November 2014. The return visit will be the first by a Turkish president since 1959.
Erdogan has expressed hope for a better relationship with the European Union after a fractious 2017, despite concerns over human rights violations in Turkey, particularly during the crackdown that followed a failed coup in July 2016.
Read More @ NowTheEndBegins.com