Posts Tagged ‘Financial Armageddon’

Bad C’s

Bad C’s prompts me to recycle my introduction to George Washington’s Blog’s "The Ongoing Cover Up of the Truth Behind the Financial Crisis May Lead to Another Crash":

Our freedom depends on our government enforcing and abiding by the law. It’s apparent that we are headed down the slippery slope Justice Louis Brandeis describes in Olmstead v. United States (1928):Justice Louis Brandeis

"In a government of laws, the existence of the government will be imperiled if it fails to observe the law scrupulously. Our government is the potent, the omnipotent teacher. For good or ill, it teaches the whole people by its example. Crime is contagious. If government becomes a lawbreaker it breeds contempt for law: it invites every man to become a law unto himself. It invites anarchy."

We have the Federal government’s massive and flagrant display of lawlessness, and population somewhere on the way from apathy to dependency in the Fatal Sequence cycle of civilization. – Ilene

Michael Panzner elaborates on this theme: 

Bad C’s

Courtesy of Michael Panzner of Financial Armageddon

Before the era of Frankenstein Finance and the fanatical focus on fee-based income, lenders tried to hold themselves out as models of probity (for the skeptics out there, I did say "try."). Those responsible for making credit-granting decisions and looking after the interests of shareholders also demanded that borrowers meet certain standards before they would see even a dime of their employers’ money. These criteria are known as the "5 C’s of Credit," which are the

key elements a borrower should have to obtain credit: character (integrity), capacity (sufficient cash flow to service the obligation), capital (net worth), collateral (assets to secure the debt), and conditions (of the borrower and the overall economy).

In an interesting twist of fate, the firms that have traditionally decided who should get credit have been put in the position of needing extraordinary amounts of other people’s money just to stay alive. Unfortunately, based on what we’ve seen so far, including reports like those that follow, it’s doubtful whether most, if not all, of today’s troubled financial institutions would even qualify for a loan based on traditional measures of suitability — like "character," for example — if their friends in high places weren’t so intimately involved in the process.

"Wall Street’s


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A Little Financial Armageddon-Style Humor

A Little Financial Armageddon-Style Humor

Courtesy of Michael Panzner of Financial Armageddon

The only way to deal with tragedy is to laugh at it.
--Indra Sinha

I serve up plenty of bad news on this site, but that doesn’t mean I’m a gloomy person. In fact, I enjoy a good laugh as well as the next guy (or girl). So, without veering too far away from the usual topics of discussion, I bring you a little Financial Armageddon-style humor:

First up: a report from Britain’s Sky News, "Credit Crunch Calendar Is Surprise Hit":

Februarycalendar

The revelation that Britain is still in recession could be good news for a surprise bestseller which ‘celebrates’ the decay wrought by the downturn.

Each month of the Credit Crunch Calendar features a depressing image of economic decline, such as closed-down shops and vandalised factories.

Covercalendar
 

The depiction of a derelict Woolworths – the old retail favourite which became a symbol of high street failure – adorns the front cover.

The product is the brainchild of Worcestershire printer Kevin Beresford, whose creations also include the Round-A-Bouts Of Great Britain range of calendars.

The UK’s downtrodden industrial landscape, viewed up-close on his many roundabout-spotting trips, moved Mr Beresford to create his chronicle.

He told Sky News: "I was just looking at all these sad, depressing things and wondered if I could turn it around and put a positive, quirky slant on it.

"I thought ‘What the hell, we’re in a recession anyway – we may as well laugh instead of cry about it’."

And last but not least: "Bohemian Bankruptcy – A Tragedy by Drag Queen," a satire from iBall, a daily video blog for investors from Britain’s Interactive Investor (via YouTube):

(Hat tip to EF.)


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Armageddon, Round Two?

Armageddon, Round Two?

Courtesy of Michael Panzner at Financial Armageddon

In Financial Armageddon, I wrote about "four impending catastrophes": debt, government guarantees, the retirement system, and derivatives. But well before the first pages of my manuscript saw the light of day, I was particularly concerned about the latter aspect.

In fact, I’ll let you in on a little secret: the article I published in November 2005, "The Coming Disaster in the Derivatives Market," was actually derived from material in my original book proposal, tentatively entitled FWMDs: Financial Weapons of Mass Destruction, after Warren Buffett’s famous remarks on the subject in Berkshire Hathaway’s 2002 annual report.

Eventually, the publisher and I decided that there was a bigger story there, which proved to be far more accurate than anybody (including me) realized at the time, and I set forth my vision of how the derivatives menace would come to interact with the various other threats I saw lurking in the shadows.

Yet even with all that has happened so far, it’s hard to ignore the fact that the house of cards that was built on this labyrinthine mass of paper promises remains a serious threat to the financial system and the economy.

To be sure, I’m not the only one who feels this way. Even some of the better known financial experts are worried, as CNBC.com reveals in "Derivatives Could Cause Another Meltdown: Mobius":

Derivatives caused the market Armageddon of recent years and if left unchecked by global leaders, the same market could cause another catastrophe, Mark Mobius, executive chairman of Templeton Asset Management, told CNBC Monday.

When asked by a CNBC viewer what kind of Armageddon could be expected if the derivatives problem is not addressed, Mobius replied: “The same kind of Armageddon that we just had, what we just saw in the last few years has been caused by derivatives.”

The lack of liquidity, transparency, coupled with its sheer size means the derivatives market poses a major risk to financial stability, according to Mobius. The currency derivatives market is especially at risk of causing problems, but interest-rate derivatives also, he said.

Mobius thinks that global leaders meeting for the G20 summit in Pittsburgh next week should focus almost solely on the derivatives trade. Debates over how much bankers are paid in bonuses should be bumped down the agenda,


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Phil's Favorites

Ray Dalio Is Kinda, Sorta, Really Wrong, Part 3

 

Ray Dalio Is Kinda, Sorta, Really Wrong, Part 3

Courtesy of John Mauldin, Thoughts from the Frontline 

Two weeks ago I started a mini-series in the form of an open letter responding to a series of essays by Ray Dalio, the founder of Bridgewater Associates. I wrote here and here that he was kinda, sorta wrong in Why and How Capitali...



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Zero Hedge

Exposing The Fed's False QE/QT Narrative With Its Own Data

Courtesy of ZeroHedge. View original post here.

Authored by Daniel Nevins via FFWiley.com,

“The fact that financial markets responded in very similar ways... lends credence to the view that these actions had the expected effects on markets and are thereby providing significant s...



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ValueWalk

Beyond Meat vs Impossible Burger: Comparing The Vegan Meat Burgers

 

Beyond Meat vs Impossible Burger: Comparing The Vegan Meat Burgers

Courtesy of Vikas Shukla, ValueWalk

Pexels / Pixabay

The trend of vegan food has been gathering momentum in the last few years as people become more health conscious. They have also begun to realize the environmental impact of raising meat for human consumption. According to PETA, it takes an estimated 1...



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Insider Scoop

McDonald's Hit New All-Time High After Quarter Pounder Update, Bullish Rating

Courtesy of Benzinga.

McDonald's (NYSE: MCD) shares hit an all-time high of $206.39 Tuesday afternoon.

On Monday, the fast-food chain announced that after a year of serving fresh beef Quarter Pounders across the United States, the company gained burger share in the "informal eating out...



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Kimble Charting Solutions

Wilshire 5000 Creating A Triple Top? An Important Breakout Test Is In Play!

Courtesy of Chris Kimble.

The stock market has been on fire of late, rallying up to the edge of price resistance on several indexes. Today, we look at one of those stock market indexes: the Wilshire 5000.

The Wilshire 5000 tracks all of the stocks in the US market, so it is a broad-based index that carries significant importance when gauging the health of the overall US stock market.

Looking at the long-term “weekly” chart above, it is pretty clear that the index is at an important price juncture.

The Wilshire 5000 spent the last 25 years trading within a rising price channel (1)...



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Chart School

Formula for when the Great Stock Market Rally ends

Courtesy of Read the Ticker.

When valuations for the boring water company or the boring electric company is trading like your Facebook, Apple, Amazon or Netflix or Google (ie FANG) you know something is wrong.

This is when a seriously over valued market is screaming at you.

Of course the reader must understand in a world where money printing goes super nuts (Zimbabwe style) the stock market may go hyper inflationary and picking a time frame for a top is never a good idea, but we are not there yet. There is no Ben Bernanke helicopter money to the masses yet (ie MMT). 

To see when water company's (and such like) are nearing the crazy FANG like valuations a review of the Dow Jones Utility Index channel shows us how history can repeat. The c...

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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control

 

Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

The 21st-century revolutionaries who have dominated cryptocurrencies are having to move over. Mainstream financial institutions are adopting these assets and the blockchain technology that enables them, in what ...



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Biotech

Consumer genetic testing customers stretch their DNA data further with third-party interpretation websites

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

 

Consumer genetic testing customers stretch their DNA data further with third-party interpretation websites

If you’ve got the raw data, why not mine it for more info? Sergey Nivens/Shutterstock.com

Courtesy of Sarah Catherine Nelson, University of Washington

Back in 2016, Helen (a pseudonym) took three different direct-to-consumer (DTC) genetic tests: AncestryDNA, 23andMe and FamilyTreeDNA. She saw genetic testing as a way...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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