Saturday, January 31, 2015

Saturday roundup (01-31-15)

Central Banks Could Create Global Recession and Deflation: Massive central-bank easing could create global recessionary and deflationary forces, just as competitive devaluations did in the 1930s. (Barron's) Why quantitative easing and negative interest rates will fail (Credit Writedowns blog)

Critical talks begin to stop meltdown over Athens debt (The Irish Independent)

Greek minister wants to link debt payments to growth - Der Spiegel (Reuters)

Greece on collision course with Brussels after Merkel backs hardline debt stance: Germany will resist Greek efforts to do deals with individual creditor nations, even as Syriza finance minister heads to meet French counterpart (The Observer) Germany, ECB play hardball with Greece (Reuters) Merkel rejects debt relief for Greece: German Chancellor Angela Merkel has rejected any idea of offering more debt relief to Greece. Her comments come amid growing tensions between the new Greek government and its international creditors. (Deutsche Welle) ECB's Liikanen: No lending to Greek banks if no deal by end of February (Reuters)

Europe's creditors play with 'political fire' in pushing Greece to the brink: "The creation of the euro was a terrible mistake but breaking it up would be an even bigger mistake. Anything could happen," warns former IMF bail-out chief by Ambrose Evans-Pritchard (The Telegraph)

100,000 flock to Madrid for Podemos rally against austerity: Inspired by the leftist Greek election victory, support grows for new political order in Spain (The Observer)

Italy elects senior judge Sergio Mattarella as president (Reuters)

Why France so worries European policy makers (The Spectator blogs)

China Factory Gauge Sinks to First Contraction in Two Years (Bloomberg) China's factory sector unexpectedly shrinks in January (Reuters)

Unofficial Problem Bank list [in the United States] declines to 388 Institutions (Calculated Risk blog)

[About 500] Walt Disney World information technology workers laid off (WESH)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Friday, January 30, 2015

Friday roundup (01-30-15)

Eurozone heads towards 'protracted' deflation as bloc hit by record price drop: Prices fall by 0.6pc across the 19-nation single currency area in January as energy costs continue to tumble (The Telegraph) Eurozone deflation deepens in January: The January drop of 0.6% follows annual deflation of 0.2% in December, which economists say vindicates the decision by the ECB to pump €1.1tn into financial markets (The Guardian)

Eurozone breakup threat reaches all-time high: As Greek leaders enter negotiations with the troika, analysts have described the coming confrontation as an “unstoppable force meeting an immovable object” (The Telegraph)

Greece, EU creditors in open dispute over demands to forgive debt, ease reforms (The Associated Press) Greece vows not to co-operate with creditors as deflation deepens: Fresh eurozone turmoil as Athens sticks to hard line and prices fall at joint-record rate (The Independent) Greece says will not cooperate with troika or seek aid extension (Reuters)

Germany to Greece: Don't Mess With Us Over Debt, Austerity (The Associated Press) Go ahead, Angela, make my day: Syriza’s win could lead to Grexit, but it should lead to a better future for the euro (The Economist)

Europe hints at Greek bailout extension (CNNMoney)

[Far-Right Leader] Marine Le Pen Leads French Presidential Poll (The Huffington Post)

Anti-euro sentiment jumps in Italy, 40 pct want lira back - poll [Reuters via] (The Daily Mail)

Russia Retreats From Ruble Defense in Surprise Interest-Rate Cut (Bloomberg) Russia cuts key rate to help economy, leaving ruble to drop (The Associated Press)

Some Economists See Spell of Deflation Ahead for Japan (The Wall Street Journal blogs)

[In the United States,] GDP growth cools to 2.6% annual rate in fourth quarter (The Los Angeles Times)

Fed Chair Yellen must weigh U.S. growth against global slowdown (The Los Angeles Times)

Zero profit growth expected for U.S. companies in 1st qtr (Reuters)

Don’t Turn America Into Europe: Why are we talking about austerity now when it’s worked so badly across the pond? (Politico)

Wall Street for President? by Simon Johnson (Project Syndicate)

How the NWS Cost the East Coast Millions During Storm (NBCNews)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Thursday, January 29, 2015

Thursday roundup (01-29-15)

Germany succumbs to Europe’s deflationary crisis: The euro area's economic titan has joined the rest of the currency bloc, and has entered deflation in January, for the first time since October 2009 (The Telegraph)

France: no waiver for Greece, maybe more time to pay debts (Reuters)

Investors have woken up to Greece's nuclear risk: European and international authorities are facing a revolt from the Greek new prime minister, Alexis Tsipras by Ambrose Evans-Pritchard (The Telegraph)

Greece’s new young radicals sweep away age of austerity: From minimum wage to prescriptions, Alexis Tsipras is making good his promises to voters in startling fashion (The Guardian)

Why the Eurozone May Need to Sacrifice Greece to Save Spain: Eurozone May Not Blink First in Confrontation With Greece (The Wall Street Journal)

Medvedev Warns Of "Unlimited Reaction" If Russia Cut From SWIFT (ZeroHedge blog)

[In the United States] We're on the verge of a crisis, bears warn (CNNMoney)

Helmerich & Payne to lay off 2,000 employees (The Tulsa World)

Air Products cut 500 jobs as part of global restructuring (The Express-Times of Easton, Pennsylvania)

[Canadian bank] CIBC to cut about 500 jobs to boost operating efficiency: source [Bloomberg via] (The Financial Post)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Is it a recovery yet? (Weekly report, 01-29-15)

A recovery would be indicated by weekly initial jobless claims holding below 500,000. ["'I think that we're hoping for the numbers to stay below 600,000, and not until we get below 500,000 can we be more certain that there is an economic recovery,' said Linda Duessel, market strategist at Federated Investors in Pittsburgh." (Reuters)]

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims declined to 265,000 in the seven days ended Jan. 24 from a revised 308,000, the Labor Department said." (Marketwatch)

U.S. jobless claims drop sharply to near 15-year low (Reuters)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Wednesday, January 28, 2015

Wednesday roundup (01-28-15)

Bank of England governor attacks eurozone austerity: Mark Carney says eurozone is caught in a debt trap and should ease hardline budget cuts just days after the Syriza election directly challenged policy (The Guardian) Bank of England Governor Mark Carney urges eurozone to spend its way out of stagnation (The Independent) Bank of England's Carney urges Europe to take plunge on fiscal union (Reuters) 'Timidity' is reponsible for eurozone stagnation, says Mark Carney: An unfinished euro area explains why the currency bloc has performed so poorly since the financial crisis, Mark Carney, the Governor of the Bank of England, says (The Telegraph)

Greece’s New Leaders Act Swiftly to Reverse Austerity: Measures to Halt Privatizations, Rehire Public Workers Trigger Greek Market Selloff (The Wall Street Journal) Greece insists it can [no] longer tolerate 'choking austerity': Greece's new prime minister says the country can no longer tolerate "choking austerity" and that its huge debts need to be renegotiated (The Telegraph)

Germans in shock as new Greek leader starts with a bang (Reuters)

Greece’s do-or-die moment: If Greece’s newly elected government sticks to its sloganeering stance, it will probably exit the Euro. And that could snowball into an economic disaster. (Fortune) Greece at the Crossroads: the Oligarchs Blew It by Charles Hugh Smith (of two minds blog)

[In the United States,] Gains From Economic Recovery Still Limited to Top One Percent (The New York Times)

[Meanwhile] Almost twice as many kids helped by food stamps than before recession (Newsday) Census Finds One in Five American Children Depends on Food Stamps to Eat (Slate blogs)

S&P cuts Atlantic City rating into junk territory (Marketwatch)

Lada Car Maker Avtovaz Plans to Cut 1,100 Jobs in Russia: Avtovaz, Controlled by Renault and Nissan, Has Been Hit by Russia’s Economic Slowdown (The Wall Street Journal)

Citrix to cut about 900 jobs (Reuters)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Tuesday, January 27, 2015

Tuesday roundup (01-27-15)

Super Mario's Desperate QE Gamble to Save Europe: Will new ECB bond purchases mean "Game Over" for Europe's economy? What will the impact be on the United States? by Christopher Whalen (The National Interest)

Germany's top institutes push 'Grexit' plans as showdown escalates: Germany’s Wolfgang Schäuble is 'relaxed' about Greek exit from the euro by Ambrose Evans-Pritchard (The Telegraph) Germany will relent on Greek debt – and Europe will suffer: Alexis Tsipras has inflicted another defeat on Berlin. Merkel is no longer Empress Angela, and the real problems await in France and Italy (The Guardian)

Bailout critic appointed Greek finance minister, as warnings build over the country's economy (The Associated Press) Greek PM Tsipras names anti-austerity cabinet, port sale halted (Reuters) New cabinet for Greece but same debt: Economics professor Yanis Varoufakis has been confirmed as Greece's next finance minister. As Sonia Legg reports he's already promised to defy advice to ''put up or shut up'' saying he intends to find solutions that favour all Europeans rather than just Greeks. (Reuters)



Low Oil Prices Could Send [the United States] Economy Into Recession (Forbes)

Fed risks deflation if it rushes to hike rates - Gundlach (Reuters) Five things to know about deflation [Tribune News Service via] (The Olympian)

Home Price Growth Slows For 11th Straight Month In November (Forbes)

Wall Street is a threat to the American middle class: The middle class is a hot political property for Republicans and Democrats alike, but the middle class can't be saved unless Wall Street is tamed. by Robert Reich (The Christian Science Monitor)

Are The Big Four American Banks Still 'Too Big To Fail'? (Benzinga)


Procter & Gamble Co. (PG) to cut 2,300 more jobs by June: CFO: Cuts will be aggressive but balanced (WCPO)

Sony to cut 1,000 jobs in smartphone business: Nikkei (Reuters)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Monday, January 26, 2015

Monday roundup (01-26-15)

Greece’s new anti-austerity government set on collision course with Brussels: Syriza leader Alexis Tsipras heads coalition of left and right parties with mandate to take on country’s paymasters (The Guardian) Greece's new prime minister puts his country on a collision course with Germany over their EU debts... and his first official act is to lay a wreath for Greek soldiers killed by the Nazis (The Daily Mail) Greek coalition braces for debt showdown as Germany rattles sabre: Markets have yet to grasp that the rift between EU creditors and Greece's firebrand premier Alexis Tspiras is 'so large as to be unbridgeable', warns Nomura by Ambrose Evans-Pritchard (The Telegraph) Greece’s Agonized Cry to Europe [Editorial] (The New York Times) Syriza victory: ‘Worse than expected’, ‘Spells trouble for Greece’ — analysts (Marketwatch)

No debt forgiveness for Greece, say eurozone finance bosses: The eurozone has ruled out debt forgiveness for Greece and warned Alexis Tsipras that his anti-austerity coalition government must honour all past agreements with international creditors. (The Telegraph)

Spain Deflation Risks Mount as Producer Prices Drop Annual 3.7% (Bloomberg)

S&P downgrades Russia's sovereign credit rating to 'junk' (Reuters)

IBM To Cut More Than 110,000 Jobs, Report Says: An unconfirmed report says IBM is embarking on a major reorganisation that will see it cut 26% of its workforce. (SkyNews) IBM dismisses Forbes report of massive layoffs (Reuters) Anatomy Of A Layoff: How IBM Is Likely To Spin This Week's Force Reduction (Forbes)

SMA Solar to cut 1,600 jobs as European demand slides (Reuters)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Sunday, January 25, 2015

Sunday roundup (01-25-15)

Syriza’s historic win puts Greece on collision course with Europe: Greek voters reject EU austerity for radical alternative of far-left party, which falls just short of an overall majority (The Guardian) Greeks Vote In Austerity Foes, a Major Shift (The New York Times)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Saturday, January 24, 2015

Saturday roundup (01-24-15)

2015: The global economy's 'sink or swim' moment (CNNMoney)

The 7-year slump: Why the global economy can’t seem to get started (The Globe and Mail of Toronto)

Mark Carney warns of liquidity storm as global currency system turns upside down: Governor tells audience at Davos that monetary tightening from the Federal Reserve will "test the resilience of the financial system" by Ambrose Evans-Pritchard (The Telegraph)

As Greece prepares to vote, a new age of Eurozone tension begins: Post-election bargaining to revive the tradition of high-stakes games of chicken between debtors and creditors (Fortune) Is Greece about to call time on five punishing years of austerity?: Historic elections could see disillusioned voters put leftwing party Syriza in power, sending a defiant message across Europe (The Guardian) Greece's election: The Syriza factor (The Economist)



Upcoming Greek Elections Could Be Trouble For European Debt Holders (Forbes)

Nothing Is Going to Save the Housing Market [in the United States] (BloombergView)

Unofficial Problem Bank list declines to 390 Institutions (Calculated Risk blog)

Highland Community Bank, IL, Second Bank Failure of 2015 [as posted here yesterday] (Problem Bank List)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Friday, January 23, 2015

Friday roundup (01-23-15)

GLOBAL ECONOMY-Evaporating inflation and growth put pressure on central banks (Reuters)

Seven Central Banks Take Anti-Deflationary Actions in Past Week (Wall Street on Parade)

An Economics Professor Explains The Danger Of Deflation In 24 Simple Slides (The Business Insider)

At the Fulcrum of Preventing Another Financial Crisis (The New York Times blogs)

ECB's €1 Trillion QE Will Not Solve Eurozone's Growth And Inflation Problems (Forbes) SocGen Explains That Since The ECB's QE Will Fail, It Will Need To Be Increased To €3 Trillion, Include Stocks (ZeroHedge blog) [Nevertheless] Bank of England Governor Backs E.C.B. Strategy (The New York Times blogs)

Davos: France ‘must speed up reforms’ in wake of QE: French president commits to faster reforms alongside ECB launch of quantitative easing (The Irish Times)

Greek anti-austerity party holds lead before Sunday elections (Reuters)

Greece to need another bailout extension - euro zone official (Reuters) Greek Public Debt at 176% of GDP in Q3 2014 (Greek Reporter) Top Economists Call For Greece To Get A Debt Write-Off Ahead Of Crucial Election (The Business Insider) Eurogroup chief hints at ‘wriggle room ’ over Greek debt: Jeroen Dijsselbloem says changes possible with the Athens adjustment programme (The Irish Times)

George Osborne tells Europeans to pull their socks up if they want to keep Britain: Chancellor George Osborne says eurozone 'must be a job-creating union, and it must respect the needs of non-euro members' by Ambrose Evans-Pritchard (The Telegraph) EU ‘PUSHING UP UK DEBT’ THANKS TO EXTORTIONATE MEMBERSHIP FEES (Breitbart)

Kremlin hard-liner: Russians would 'rather starve' than surrender Putin to Western aggressors: Russia's deputy prime minister, speaking at the World Economic Forum, says that his country's dispute with the US and Europe goes far beyond issues over Ukraine by Ambrose Evans-Pritchard (The Telegraph)

China January factory growth stalls, deflation pressures build, bad debt rises (Reuters)

Brazil’s worst drought in history prompts protests and blackouts: Lights go out, internet is cut for days, and agriculture is suffering as crisis spreads from São Paulo to Rio de Janeiro and beyond (The Guardian)

Eyes on Fed after ECB, other bank stimulus moves (Reuters)

Regulators close small bank in Chicago; second US bank failure of 2015 (The Associated Press) Highland Community Bank of Chicago IL had a troubled assets ratio of 136.4%. (BankTracker)

John Deere laying off 910 workers in Iowa, Illinois (KCCI)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Thursday, January 22, 2015

Thursday roundup (01-22-15)

Quote of the Day:

"It is urgent for Europe to bring Obama and the people making the decisions behind him back to reality. If not, this will spiral first into a financial collapse, which will slam into all of Europe, and then who knows where it goes after that? Everywhere, far-right nationalist forces are building. Look at the last U.S. Congressional elections, and think what is coming. Will America ever have had a more nationalist Congress?  Le Pen would be right at home in this crowd. The course we are on now is folly.  Can’t they see that?" -- Unnamed head of one of the largest companies in Germany (Salon)

If oil drops below $30 a barrel, brace for a global recession (Marketwatch)

Larry Summers warns of epochal deflationary crisis if Fed tightens too soon: Former US treasury secretary also says eurozone QE has come too late to lift the region off the reefs on its own. by Ambrose Evans-Pritchard (The Telegraph)

QE for the eurozone is a gigantic confidence trick. It should fool no one: Quantitative easing will simply bury money in commercial bank vaults, when it is cash in circulation that’s desperately needed (The Guardian) ECB launches 1 trillion euro rescue plan to revive euro economy (Reuters) Eurozone Nations Face Stronger Pressures to Lift Economies (The New York Times)

Draghi: "There must be a statute of limitations for those who say there will be inflation" (Calculated Risk blog)

Mario Draghi's QE blitz may save southern Europe, but at the risk of losing Germany: The ECB has put German political consent for the euro project at risk by Ambrose Evans-Pritchard (The Telegraph)

[In Greece:] ‘The bailout is over. Blackmail is over. Subservience is over’: Greece will make history, Syriza leader Alexis Tsipras tells final rally ahead of general election (The Irish Times) Greek election: Rena Dourou of Syriza poised to sweep away austerity: “Is it really right for thousands of people to commit suicide because of austerity policies?" asks Syriza's most senior politician ahead of Sunday's general election (The Telegraph)

QE for everyone... except Greece: CNBC's Michelle Caruso-Cabrera discusses the European central bank's QE program and takes a close look at Greek debt. (CNBC)



Irish crash could have collapsed euro, bailout chief tells inquiry (The Belfast Telegraph)

Bank of England says no urgency in returning interest rates to normal levels: Decline in oil prices means there should be no hurry to raise borrowing costs, says monetary policy committee spokesman (The Guardian)

Russian business is braced for ‘much worse’ (CNBC)

As central banks surprise, Fed may have to throw in the towel (Marketwatch)

‘Too Big to Fail’ on Financial Regulators’ Agenda Again [in the United States] (The New York Times blogs)

Kansas City Fed: Regional Manufacturing "Activity Expanded at a Slower Pace" in January, Weaker Energy Sector (Calculated Risk blog)

Raise the Millionaires tax: Return to tried and true policies that encouraged and grew our once-robust middle class. (USAToday)

Air France tells staff of plan to cut 800 jobs-sources (Reuters)

Mining company Arrium to cut 600 jobs in SA amid falling iron ore price (The Australian Broadcasting Corporation)

DreamWorks Animation to cut 500 jobs (The Los Angeles Times)

Why These 5 Companies Are Laying Off Thousands of Workers: The economy is on the mend. Unemployment rates are down. So what's up with all these companies slashing jobs by the thousands? (Time)

Target's package for ex-CEO matches package for all [of the company's] 17,600 Canadian workers: Value of Gregg Steinhafel's 'walk-away' package estimated at $61M (The Canadian Broadcasting Corporation)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Is it a recovery yet? (Weekly report, 01-22-15)

A recovery would be indicated by weekly initial jobless claims holding below 500,000. ["'I think that we're hoping for the numbers to stay below 600,000, and not until we get below 500,000 can we be more certain that there is an economic recovery,' said Linda Duessel, market strategist at Federated Investors in Pittsburgh." (Reuters)]

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims declined to 307,000 in the seven days ended Jan. 10 from a revised 317,000, the Labor Department said Thursday." (Marketwatch)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Wednesday, January 21, 2015

Wednesday roundup (01-21-15)

The "Deflationary Vortex": Global Dollar Economy Suffers Biggest Plunge Since Lehman, Down $4 Trillion (ZeroHedge blog)

ECB Seeks to Inject Up to 1.1 Trillion Euros Into Economy in Deflation Fight (Bloomberg) 5 THINGS TO LOOK FOR IN EUROZONE QE (The Wall Street Journal blogs)

Europe on brink of deflating, needs stimulus: Larry Summers (Reuters)

The ECB’s Damned-If-You-Do QE Moment: Europe needs stimulus. Mario Draghi has promised to "do whatever it takes." But quantitative easing won't make the eurozone's real problems go away. (Foreign Policy)

QE and central bank solvency - what would happen to the Eurosystem’s capital resources if a country defaults? Would this generate a fiscal transfer between members? (Bruegel)

EU has squandered last chance to make euro workable, warns Ex-Bundesbank chief: Axel Weber says it is "hard to say" whether Europe would be in better shape today if the euro had never been launched, a tactful evasion understood as nostalgia for the stability of the D-Mark by Ambrose Evans-Pritchard (The Telegraph) German opt-out could fatally weaken eurozone QE (Marketwatch)

Can the eurozone afford a Greek exit?: ‘Grexit’ would weaken German and French banks and cost Berlin up to €77bn, and IMF a slug of its loan (The Guardian) Economists Call for Cancellation of Greek Debt to Avoid ‘Inescapable’ Austerity (Newsweek) A Look at Greece's Debt Debate Before Elections (The Associated Press)

Bank of England Dissenters Dropped Call to Raise Rates, Meeting Minutes Show (The New York Times)

Bank of Japan Cuts Price Forecast, Maintains Record Stimulus (Bloomberg)

Shadow banking now poses top risk to US stability, warns IMF: Non-financial lending has reached $15 trillion since the crisis and is outside the control of authorities warns the Fund's deputy chief by Ambrose Evans-Pritchard (The Telegraph)

Manager 'truly sorry' for blowing up hedge fund ["lost all but $200,000 of the firm's capital—down from the roughly $100 million"] (CNBC)

Crude Collapse Has Investors Braced for ’80s-Like Oil Casualties (Bloomberg) The Real Reason Oil Prices Plunged (FoxBusiness)

American Express says to cut more than 4,000 jobs (Reuters)

EBay to slash 2,400 jobs amid weak holiday sales (The Los Angeles Times)

Sony to Cut 1,500 Jobs in Japan (Variety)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Tuesday, January 20, 2015

Tuesday roundup (01-20-15)

IMF: The world economy is worse off than we thought (CNNMoney)

Central bank prophet fears QE warfare pushing world financial system out of control: Former BIS chief economist warns that QE in Europe is doomed to failure and may draw the region into deeper difficulties by Ambrose Evans-Pritchard (The Telegraph)

Will eurozone QE be too little, too late?: Having ramped up expectations, there is now a danger that the long-awaited sovereign bond purchases will prove a damp squib, writes Larry Elliott (The Guardian blogs)

How The ECB's QE Is About To Send The Most Deflationary Signal Ever (ZeroHedge blog)

IMF's Lagarde says euro zone exit would be 'devastating' for Greece (Reuters)

Germany to offer no return on its five-year bonds [The Wall Street Journal via] (Marketwatch)

Are Spain and Italy headed for 1% yields? (CNBC)

China economic growth is slowest in 24 years (Marketwatch)

The time to start worrying about U.S. deflation may be now (Marketwatch)

Obama May Highlight Shrinking Budget Deficits, But They Mask Mounting Debt (The Wall Street Journal blogs)

Illinois' budget deficit [= $9 billion] twice as bad as you think (Crain's Chicago Business blogs) Study projects Illinois deficit growing to $14 billion by 2026: Author likens the state to person with 'deep credit card debt' (WBEZ)

Pennsylvania's budget deficit [= $2.33 billion] larger than expected (TribLive)

Pension deficit stands at $1.85 billion, city of Montreal [in Canada] says (The Montreal Gazette)

Baker: Massachusetts Facing $765 Million Budget Deficit (CBSBoston)

Michigan House agency: $454M shortfall this year [Jan. 14] (The Detroit News)

Budget deficit [= $280 million] to dominate 2015 legislative session [in Kansas] [Jan. 10] (The Topeka Capital-Journal)

State Budget Deficit [in Connecticut] Jumps To $121 Million - Partly Due To Low Gas Prices (The Hartford Courant)

Poll: Bipartisan backing for breaking up big banks (The Hill)

Oil company Baker Hughes cuts 7,000 jobs (CNNMoney)

Aviva Expects 1,500 Jobs Cuts from Friends Life Deal (Bloomberg)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Monday, January 19, 2015

Monday roundup (01-19-15)

Richest 1% is about to own more than everyone else put together: Oxfam (Marketwatch) Business leaders warned about 'staggering' global wealth gap (The Globe and Mail of Toronto)

More QE won't help world economy, says ex-BoE governor King (Reuters)

Former White House Official – Europe In Danger Of Mega-Bank Runs That Jeopardize The World (King World News) Pippa Malmgren (Wikipedia)

Hollande: ECB will pull trigger on QE plans this week (Marketwatch) The ECB's QE Is Coming, Too Small, Late And Might Well Fail (Forbes)

Danish central bank cuts rates in preparation for eurozone QE: As investors expect a eurozone quantitative easing scheme to be announced this week, Denmark's National Bank has cut its interest rates deeper into negative territory (The Telegraph)

"Grexit" risk may be underestimated, Greek officials say (Reuters)

Anti-bailout Syriza extends poll lead as Greece's election day nears (Reuters)

Spain anti-austerity activists look with hope to Greece's Syriza (Agence France Presse)

David Blanchflower: We [in Britain] should fear deflation – not welcome it (The Independent)

Northern Ireland to cut 20,000 public-sector jobs - minister (Reuters)

Russia Braces for Widening Deficit as Oil Plunge Starves Budget (Bloomberg)

[In the United States,] 28 states now average sub-$2 a gallon gasoline (USAToday)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Sunday, January 18, 2015

Sunday roundup (01-18-15)

Deflation is the global economy’s primary enemy: A dollar on the rise and yields on the decline do not suggest easy answers ahead [The Financial Times via] (Gulf News)

ECB likely to announce stimulus this week (USAToday) Draghi’s Big Push Seen Delivering $635 Billion With QE This Week (Bloomberg) ECB faces crucial test of 'whatever it takes' (Reuters)

Grexit the only way out of ‘valley of tears,’ says Hans-Werner Sinn: Head of the Institute for Economic Research argues eurozone should allow Greece orderly temporary departure (ekathimerini)

Frontier Airlines to Shed 1,300 Jobs in Denver and Milwaukee (The Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Saturday, January 17, 2015

Saturday roundup (01-17-15)

Europe’s far right gets the attention, but the left is making the political running: EU leaders are already assuming that Syriza will win the Greek election. If so, the consequences elsewhere could be profound (The Observer)

A new idea steals across Europe – should Greece’s debt be forgiven?: As anti-austerity Syriza rises in the polls, threatening a crisis, experts are starting to believe default might be best for everyone (The Observer) Germany’s Schaeuble Opposes Greek Debt Relief (Dow Jones Newswires)

Majority of U.S. public school students are in poverty (The Washington Post)

Republicans and Wall Street Say To Hell With Protecting the Public! [interview with Simon Johnson] by Bill Moyers (Moyers & Company)

Falling oil's next victim: banks (CNNMoney)

Unofficial Problem Bank list declines to 392 Institutions (Calculated Risk blog)

US Regulators Close Small Florida Bank (The Associated Press) First National Bank of Crestview of Crestview FL had a troubled assets ratio of 446.8%. (BankTracker) 1st Bank Failure of 2015 – Feds Close First National Bank of Crestview, FL (Problem Bank List)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Friday, January 16, 2015

Friday roundup (01-16-15)

Tanking oil prices make deflation a real threat (The Globe and Mail of Toronto) How Plunging Oil Prices Could Create Economic Upheaval (The Fiscal Times) Don't Expect a Boom From Cheap Oil (BloombergView)

Steepest Oil-Rig Drop Shows Shale Losing Fight to OPEC (Bloomberg)

EU consumer prices fall for first time on record (Marketwatch)

ECB Weighing QE Through National Central Banks, Spiegel Reports (Bloomberg) The ECB’s (Losing) Battle Against Deflation (The Wall Street Journal blogs)

Euro zone ponders up to six-month Greek program extension, third bailout (Reuters) Merkel Said to See Tsipras Ready to Deal as Crunch Looms (Bloomberg) Is this Europe’s Lehman Brothers moment? (FoxNews)

The Greek Business Community Is Worried That The Upcoming Election Might [Result in a Stalemate Which Would] Kill Any Shot At Economic Recovery (The Business Insider)

Italy's central bank slashes 2015 growth forecast, sees deflation (Reuters)

10 Takeaways From Lagarde’s Swipe at the Swiss National Bank (The Wall Street Journal blogs)

FXCM, Brokerage Hit by Swiss Shock, Gets $300 Million From Jefferies Owner Leucadia (Bloomberg) FXCM Lobbied Against Leverage Limit Before Trades Went Bad (Bloomberg) Surge of Swiss Franc Triggers Hundreds of Millions in Losses: Brokerage FXCM Gets Rescue Package; Deutsche Bank and Citigroup Suffer Big Hits (The Wall Street Journal) Swiss shock crushes US currency broker (CNNMoney) Broker Alpari UK declares insolvency after Swiss franc losses (Agence France Presse) Casualties From Swiss Shock Spread From New York to New Zealand (Bloomberg)

Francs, Fear and Folly (The New York Times) Regime Change in Switzerland (The New York Times blogs)

Man Who Predicted Collapse Of Euro Against Swiss Franc Gives More Shocking Predictions For 2015 (King World News)

Russia May Resort to Currency Restrictions If Outflows Continue to Mount (Bloomberg)

Everybody Expects China Growth to Decelerate, Chu Says: Charlene Chu, a senior partner at Autonomous Asia, talks about the outlook for China's banks and economy. She speaks with Angie Lau on Bloomberg Television's "First Up." [Jan. 12] (Bloomberg)


[In the United States,] December consumer prices fall most in 6 years (CNNMoney) Can the U.S. Stay Out of the Deflation Vortex? (Bloomberg)

Ocwen's Altisource Spinoff Fires 800 as CEO Pleas for Calm (Mortgage Servicing News)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Thursday, January 15, 2015

Thursday roundup (01-15-15)

Quote of the Day: "The global economy is running on a single engine... the American one. This does not make for a rosy outlook for the world." -- Kaushik Basu, chief economist for the World Bank (The Express)

Global economic outlook is glum despite cheaper oil - IMF (Reuters) IMF's Lagarde: Excessive borrowing and high unemployment threaten global growth (The Associated Press)

Oil producers, indebted euro zone states at risk of downgrades - Fitch (Reuters)

IMF chief urges stronger European stimulus (USAToday)

World central banks on deflation alert as Swiss cut rate to -0.75% -- ["no central bank has ever set its official interest so low"] (Fortune) World deflationary forces have swept away Switzerland's defences: A month ago the Swiss authorities were still claiming that their currency floor was crucial to prevent a deflation trap. They were right by Ambrose Evans-Pritchard (The Telegraph) Switzerland 'capitulates' on franc as global currency wars take next victim: The franc soared 30pc in one of the wildest days in Swiss history after the central bank abandoned its currency cap to avert mounting losses by Ambrose Evans-Pritchard (The Telegraph) Swiss central bank stuns market with policy U-turn (Reuters) Q&A: Why has Switzerland abandoned its currency ceiling?: The Swiss National Bank has maintained a minimum exchange rate against the euro since the heights of the eurozone crisis. What will its removal mean for you? (The Telegraph)

Swiss franc soars against euro (NBCNews)



SNB Was Ahead of the Curve on Currency: Jane Foley: Jane Foley, senior foreign exchange strategist at Rabobank, discusses the surprise move by the Swiss National Bank to end the minimum exchange rate and lower the interest rate to -0.75 percent. She speaks on “Bloomberg Surveillance.” (Bloomberg)



Gartman: Swiss made worst central bank decision ever (CNBC)



Lagarde: Swiss move 'bit of a surprise': IMF Managing Director Christine Lagarde says she is surprised she was not contacted by the Swiss National Bank, after news the central bank is removing a 3-year-old cap of 1.20 francs per euro. (CNBC)



Greece's Election [on Jan. 25] May Lead to Clash With EU Over Austerity (Bloomberg)

Is Spain's recovery at risk from deflation? (CNBC)

With Ruble in Freefall, Russians Scramble to Dump Trophy Homes and Break Contracts: The stereotype of a Russian buyer pushing a wheelbarrow full of cash to the waiting doors of 15 Central Park West is a thing of the past. (The New York Observer)

Russia to Dip Into Wealth Fund as Ruble Crisis Pressures Economy (Bloomberg)

In surprise move, Target exits Canada [which will leave "more than 17,000 employees out of work"] and takes $5.4 bln loss (Reuters)

Crude oil's collapse will cost 9,000 jobs at Schlumberger (USAToday) Schlumberger to slash 9,000 jobs as oil prices plunge (Reuters)

Bombardier Pauses Learjet 85 Program; Will Lay Off 1,000 Workers (Aviation Week) Bombardier Inc shares plunge amid LearJet 85 suspension, liquidity concerns (The Financial Post)

When Is a GMO Not a GMO? (Equities)

Download the True Food Shopper's Guide: How to Avoid Foods Made with Genetically Modified Organisms [GMOs] (The Center for Food Safety) Say "No" to GMOs (Non-GMO Project) THE GREAT GMA COVERUP INFOGRAPHIC (WalkByTheWay) GMO FREE USA (Facebook)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Is it a recovery yet? (Weekly report, 01-15-15)

A recovery would be indicated by weekly initial jobless claims holding below 500,000. ["'I think that we're hoping for the numbers to stay below 600,000, and not until we get below 500,000 can we be more certain that there is an economic recovery,' said Linda Duessel, market strategist at Federated Investors in Pittsburgh." (Reuters)]

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims climbed 19,000 to 316,000 in the seven days ended Jan 10, the Labor Department said Thursday. " (Marketwatch)

Initial jobless claims unexpectedly jump 19,000 to four-month high (The Los Angeles Times)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Wednesday, January 14, 2015

Wednesday roundup (01-14-15)

Is a global economic recession coming? Copper price say 'yes': The market for copper, a metal that two years ago was being stolen by thieves looking for big profits, is crashing – the latest in a string of commodities nosedives that have experts worried about the broader implications for the global economy (The Guardian)

I Went To A Talk With Nouriel Roubini And Ian Bremmer, And Now I'm Worried About Everything (The Business Insider)

EU court adviser paves way for ECB money printing (Reuters) Devil May Be in the Details on European Central Bank Bond-Buying (The New York Times) Europe's imperial court is a threat to all our democracies: The European Court of Justice has this time departed a long way from the rule of the law, even by its own elastic standards by Ambrose Evans-Pritchard (The Telegraph)

As Eurozone Eyes New Stimulus Plan, Some Question Its Merits (The Associated Press)

Moody’s: ‘Grexit’ likely to trigger renewed recession in the eurozone (Marketwatch)

Greece May Get Debt Extension, Rehn Says in Urging Unity (Bloomberg)

Italy's president retires – what now for reforms? (CNBC) Italian President Giorgio Napolitano Resigns: Next Steps (Bloomberg)

Fed too complacent on US deflation damage (The American Enterprise Institute)

Houses passes bill easing rules regulating Wall Street (The Associated Press)

Oil price drops bring pain to Texas, North Dakota - Fed (Reuters) Layoffs Hit The Oilpatch, With Worst Yet To Come (Forbes)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.

Tuesday, January 13, 2015

Tuesday roundup (01-13-15)

Deflation Bells are Deafening [Worldwide] (BloombergView) Here's The Starkest Evidence Central Banks Are Losing And Deflation Risk Is Going Global (The Business Insider - Australia)

World Bank cuts global economic outlook despite oil price drop (Reuters)

OPEC’s squeeze on U.S. oil independence could succeed: Calculated strategy has economic and political goals by Satyajit Das (Marketwatch)

World Bank calls for quantitative easing to stop eurozone stagnation: Bank suggests structural defects could be behind lasting failure to recover to pre-recession growth as US and UK pull away (The Guardian) ECB President Mario Draghi dips his toe in QE waters: As the eurozone struggles, the European Central Bank seeks a course of quantitative easing to boost growth. What does this involve and will it work? (The Independent)

EU gives deficit countries more flexibility to meet budget rules: The European Commission says it will offer member states that present credible reform plans more time to bring their budgets in line with EU laws, a move that could be positive news for nations such as France and Italy. (Deutsche Welle)

Greek deflation picks up in December, prices fall for 22nd month (Reuters)

ECB’s Nowotny Warns of Contagion Effects of Greek Exit From Eurozone (The Wall Street Journal blogs)

UK inflation plummets to 14-year low in December (CNBC) BoE Governor warns deflation is now 'possible': Inflation has slipped to a 14-year low of 0.5pc, lower than economists and the markets had expected (The Telegraph) [And yet ...] Half the world covets the UK’s precious inflation: Inflation is now a rare commodity in most of the developed world but the UK's falling prices are also a tax cut we should all enjoy by Ambrose Evans-Pritchard (The Telegraph)

Asia Stares at Deflation With Rising Debt, Morgan Stanley Says (Bloomberg)

Clip Dodd-Frank at your own risk (USAToday) There's A Big Wall Street Regulation Showdown Brewing In Washington Right Now (The Business Insider)

Elizabeth Warren: I'm not running for president by Sheila Bair (Fortune)

Elizabeth Warren Says She Won’t Run, but ‘Draft Warren’ Activists Plan to ‘Change Her Mind’ (The Nation blogs) Run, Warren, Run: Elizabeth Warren can run for president. She should run for president. And despite her denials, she probably will. (The Atlantic) N.H. effort aims to draft Warren into presidential race (The Boston Globe)

Elizabeth Warren wins on Antonio Weiss nomination: Antonio Weiss pulls out of Treasury slot; will instead serve as counselor. (Politico)

Supermarket price wars claim 2,000 jobs as Big Four cut costs: Morrison fires chief executive Dalton Philips after he fails to counter new players such as Aldi (The Independent)

Suncor to cut 1,000 jobs in response to low oil prices: Energy firm to cut $1B from capital spending, delay work on some projects (The Canadian Broadcasting Corporation)

Philippine affiliate of Philip Morris to trim 13 pct of country's workforce [= 640 jobs] (Reuters)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats exist today that could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. Key threats include excessive risk-taking by financial firms, unchecked by effective regulation; the continued existence of "too big to fail" institutions; and most especially, the amassing of levels of public and private debt which could become unsustainable.