Thursday, September 24, 2015

Global Markets: It's Getting Ugly Out There

We also discussed the most critical systemic sources of risk in global markets.
You'd have to be in full denial mode not to see that it's getting ugly out there in global markets: currencies are melting down, trade and shipping are tanking, commodities are swooning and global stock markets are increasingly on central-bank life support.
Gordon Long and I recently discussed just how ugly it might get in a 28-minute video program.
One focus was Gordon's forecast that the market may yet recover from its current downtrend and trace out a M Top: one more buy the dip rally that would then be followed by a bone-crushing downtrend as the wheels completely fall off the global "growth" story.
We also discussed a few of the most critical systemic sources of risk in global markets:
1. There's too much debt globally; public and private debt has skyrocketed since 2008.
2. Mal-investment due to perverse incentives: corporations borrow money for stock buybacks rather than to invest in new productive capacity
3. Stagnant income/revenues: households, companies and nations cannot support more debt
4. The rise of high-frequency trading (HFT) has increased the odds of flash crashes and instability
5. The rising U.S. dollar has triggered capital flight from emerging markets and China
6. China’s economy is grinding to a halt, crushing demand for commodities and commodity-dependent economies
7. Opaque banking: shadow banking in China, dark pools in offshore banking centers, etc. True totals of debt, leverage and the quality of collateral are all unknown
8. Deteriorating collateral globally. How many of the 60 million empty “investment” flats in China can be sold in an illiquid marketplace with little demand for existing housing? What's the real value of assets listed on U.S. balance sheets that are marked to fantasy?
We cover a lot of ground in this program.
It's Getting Ugly Out There (28:20 video, with Gordon T. Long)

NOTE: Contributions/subscriptions are acknowledged in the order received. Your name and email remain confidential and will not be given to any other individual, company or agency.
Thank you, Mark Z. ($50), for your splendidly generous contribution to this site -- I am greatly honored by your support and readership.
Thank you, Martin C. ($50), for your superlatively generous contribution to this site -- I am greatly honored by your steadfast support and readership.

Terms of Service

All content on this blog is provided by Trewe LLC for informational purposes only. The owner of this blog makes no representations as to the accuracy or completeness of any information on this site or found by following any link on this site. The owner will not be liable for any errors or omissions in this information nor for the availability of this information. The owner will not be liable for any losses, injuries, or damages from the display or use of this information. These terms and conditions of use are subject to change at anytime and without notice.


Our Privacy Policy:


Correspondents' email is strictly confidential. This site does not collect digital data from visitors or distribute cookies. Advertisements served by a third-party advertising network (Investing Channel) may use cookies or collect information from visitors for the purpose of Interest-Based Advertising; if you wish to opt out of Interest-Based Advertising, please go to Opt out of interest-based advertising (The Network Advertising Initiative). If you have other privacy concerns relating to advertisements, please contact advertisers directly. Websites and blog links on the site's blog roll are posted at my discretion.


PRIVACY NOTICE FOR EEA INDIVIDUALS


This section covers disclosures on the General Data Protection Regulation (GDPR) for users residing within EEA only. GDPR replaces the existing Directive 95/46/ec, and aims at harmonizing data protection laws in the EU that are fit for purpose in the digital age. The primary objective of the GDPR is to give citizens back control of their personal data. Please follow the link below to access InvestingChannel’s General Data Protection Notice. https://stg.media.investingchannel.com/gdpr-notice/


Notice of Compliance with The California Consumer Protection Act
This site does not collect digital data from visitors or distribute cookies. Advertisements served by a third-party advertising network (Investing Channel) may use cookies or collect information from visitors for the purpose of Interest-Based Advertising. If you do not want any personal information that may be collected by third-party advertising to be sold, please follow the instructions on this page: Limit the Use of My Sensitive Personal Information.


Regarding Cookies:


This site does not collect digital data from visitors or distribute cookies. Advertisements served by third-party advertising networks such as Investing Channel may use cookies or collect information from visitors for the purpose of Interest-Based Advertising; if you wish to opt out of Interest-Based Advertising, please go to Opt out of interest-based advertising (The Network Advertising Initiative) If you have other privacy concerns relating to advertisements, please contact advertisers directly.


Our Commission Policy:

As an Amazon Associate I earn from qualifying purchases. I also earn a commission on purchases of precious metals via BullionVault. I receive no fees or compensation for any other non-advertising links or content posted on my site.

  © Blogger templates Newspaper III by Ourblogtemplates.com 2008

Back to TOP