Death-Watch Updates on the Collapsing Global Financial System

Bec.De.Corbin wrote:

You better be prepared with more than "political options". You better arm yourself (just in case it really gets that bad). 

Anyone for an oxymoron watch thread.

The subject here overlaps with a thread that I have been contributing to over a number of months. Has the Unipolar World Finally Come to an End? is a thread that I started in March of last year and it is still going with the ocassional contribution.

I think it's important to understand that some MSM predictions of a financial, or other sort of, apocalypse reflects sometimes the desire to see Western, primarily US, dominance continue in perpetuity. And, therefore, any change in global arrangements are viewed as "a terrible disaster". But these other, BRICS-related, alternative institutions are marching forward and may be expected to play a more and more significant role in the future.

"It's true that I would prefer it if the existing political systems in the US, Canada and Europe were to fall apart, but not people's lives along with it."

This comment made my blood run cold.  Good luck seeing our existing political systems disappear with no effect on people's lives....

Doomsday clock for global market crash strikes one minute to midnight as central banks lose control

John Ficenec
London Telegraph
August 17, 2015

.........................

With the Chinese depegging their currency from the US dollar, are they preparing to watch the dollar collapse, what with US economic stagnation and forced renewed Quantitative easing?

And with the ongoing carnage in the Yuan Dollar carrytrade, threats to the hedge fund industry for reliance on this trade? and increasing flight from the bubbles of the Chinese financial system? Forcing the Chinese to dump their US currency assets?

whew!

¨Good luck seeing our existing political systems disappear with no effect on people's lives....¨

This is precisely my point...with no interest just to scare people into reality out of their Canadian media based fantasy...

If activists with some awareness and concern for public security don´t act? And build movement?

And with Canada´s economy overindebted saturated at every level, municipality, corporate, personal...unless we are prepared, everything will grind to a halt! total paralysis!

Of course the combination of collapsing oil prices and skyrocketing junk bond interest rates which sustain the Canadian energy system means bankruptcy in spades.....

Michael Snyder
Economic Collapse
August 19th, 2015

Yields on the riskiest junk bonds are absolutely soaring and the price of copper just hit a fresh six year low.

.  The following comes from a Wall Street On Parade article that was posted on Tuesday entitled “Keep Your Eye on Junk Bonds: They’re Starting to Behave Like ‘08“…

According to data from Bloomberg, corporations have issued a stunning $9.3 trillion in bonds since the beginning of 2009. The major beneficiary of this debt binge has been the stock market rather than investment in modernizing the plant, equipment or new hires to make the company more competitive for the future. Bond proceeds frequently ended up buying back shares or boosting dividends, thus elevating the stock market on the back of heavier debt levels on corporate balance sheets.

Now, with commodity prices resuming their plunge and currency wars spreading, concerns of financial contagion are back in the markets and spreads on corporate bonds versus safer, more liquid instruments like U.S. Treasury notes, are widening in a fashion similar to the warning signs heading into the 2008 crash. The $2.2 trillion junk bond market (high-yield) as well as the investment grade market have seen spreads widen as outflows from Exchange Traded Funds (ETFs) and bond funds pick up steam.

And right now we are seeing the most volatility in the junkiest of the junk bonds.

The following comes from Wolf Richter, and my jaw just about dropped to the floor when I first saw this…

This chart of yields at the riskiest end of the junk bond market – bonds rated CCC and below – shows what happened. These bonds have been selling off over the past 12 months, with exception of the sucker rally earlier this year, and their yieldsmore than doubled from less than 7.9% in June a year ago to 16.2% by Thursday evening. And Thursday was a massacre:

On Thursday, yields jumped 2.6 percentage points, from 13.58% to 16.18%, as these junk bonds plunged. Those kinds of single-day vertigo-inducing sell-offs are rare in normal times, and there haven’t been any since the Financial Crisis.

"What was historically considered the normal paradigm—investing capital to build factories and mines and carry out research and development, hire workers, and generate profit from the surplus value extracted through their exploitation—has become almost incidental to a ceaseless, feverish scramble for ever-higher yields from various forms of financial manipulation and outright fraud."

...thanks for this, which pretty well sums it up! As we watch the catastrophe unfold before our eyes...another major decline today across the board...setting up for a real blowout tomorrow!

What this thread and "issue" suggests best of all, is the total irrelevance of our Canadian political institutions; Parties, media, so called think?tanks...laughable to hear their opinions as the system comes crashing down....

Unless people, intellectuals, activists don't start paying attention here, to try to make sense of what's happening, to begin building alternative solutions, and for this electoral cycle? (Though not to worry, the collapsing system in Canada, so dependant on the collapsing commodities and financial sectors, will bury governments as fast as they are created.....

What is urgent now is to prepare for the government responses, which undoubtedly include bailouts (of the corporates) and bail ins (of the people)...No bailouts to the perpetrators of this corrupt system!

The problem of course will be the desperation of the people without means to sustain themselves...this must be on the top of the Agenda of movements to offer the political alternatives!

I don't see the need for any centralized "movement".....

I agree about the centralism part, most of what you say...what is needed though is a national movement based in the power of the community, via some form of general assembly per community, a federalist approach from the  bottom up!

There have been lots of revolutions, fundamental restructuring of Society and culture cooming this way, all to the bad destroying community, culture, and technology, what I call natural economics from the ground up, destroying our civil rights ad nauseum...time for some good ones I would say! to continue as we're going, means misery and destruction for the most of us!!

what will it take to bring the crisis, now being faced by most of the planet, home to North America, in full force, and thereby wake people and activists up from their daydreams of reality?

Watch the US dollar!

" Russian president Vladimir Putin has proposed a bill to the country’s legislature to eliminate the dollar and the euro from trade between member states of the Commonwealth of Independent States (CIS).....".....

The Chinese Government desperately continues to maintain the yuan peg to the dollar, as its economy, finances and world confidence continues to melt...by cashing in their US treasury bonds, 100 billion last week!

Meaning! That US treasuries will no longer be considered an investment of safe haven, as everything else continues to deflate...

Can there be any doubt now, that the world is tossing the US dollar as global reserve currency?

Meaning that interest rates in the USA must continue to rise...which of course spells disaster for the real estate bubbles of North America....

the race is on...to see if the real estate market in Canada, especially BC takes its nosedive...as Chinese investors are forced to pull out by Chinese Government decree and control over everything of the so called free market system....before the election...whatever!
The paralysed tied party system will inherit total collapse, with of course not a clue as to the cause nor the cure!

Where will the alternatives come from, I wonder.....

Aussie Property Market Collapse Looms As Chinese Flee Amid Capital Controls Submitted by Tyler Durden on 09/15/2015 21:00 -0400

Given the recent admission by the Australian Central Bank that property prices "have gone crazy," it appears new Chinese 'regulations' may just kill Australia's golden goose of 'weath creation' as Aussie's largest trade partner sees its economy collapse. While the Aussies themselves proclaimed a "war on cash," it appears, as AFR reports, that Chinese purchases of Australian property have dropped significantly in the past month, according to agents, as buyers struggle to shift money out of the country following Beijing's move to tighten capital controls. With Chinese banks now limiting any overseas transfer to USD50,000 - in an effort to control capital outflows - and with China dominating the Aussie housing market, one agent exclaimed, "it has affected 70 to 80 per cent of current transactions and some have already been suspended."

OPEC Is About to Crush the U.S. Oil Boom  Grant Smith from Bloomberg.......

I will begin again to try passing on info re the collapsing world financial order, recognizing here that for the most part

progressives have a deep and undying faith in the system...

the NA oil industry is downsizing to stem their losses...their major investment banks are passing on their losses to unsuspecting investment community, including mutual and pension funds likewise having a fundamental faith in the system, until of course it crashes, while the Big banks think they will escape the damage.

It only means the crash will be general and universal!

from WSWS...

There is no recovery in the global economy, as one emergency measure is piled on another, and those in charge of economic and monetary policy have no idea how to engineer one. This is not the result of some intellectual incapacity. It arises from the fact that the events of 2008 were not a conjunctural crisis, but a fundamental breakdown of the global capitalist system, which has continued to deepen.

The sole response of financial authorities at every turn has been to make available still more supplies of ultra-cheap money—a policy dictated by the fear that a return to “normal” rates could trigger a new crisis and the insatiable demands of the financial parasites who command the heights of the economy.

When this program was first announced, it was claimed it would provide a stimulus to real economic growth. That assertion has been completely discredited. Quantitative easing in its various national forms has done nothing to revive investment in the real economy. Rather, it has accelerated the process by which financial manipulation and speculation become the chief forms of profit accumulation.

Not only has this parasitism led to the outright destruction of the productive forces--including through giant mergers and acquisitions leading to asset-stripping and job cutting

thread drift...

Iceland Sentences 26 Bankers to a Combined 74 Years In Prison

In a move that would make many capitalists’ head explode if it ever happened here, Iceland recently sentenced their 26th banker to prison for their part in the 2008 financial collapse.

In two separate Icelandic Supreme Court and Reykjavik District Court rulings, five top bankers from Landsbankinn and Kaupping — the two largest banks in the country — were found guilty earlier this month of market manipulation, embezzlement, and breach of fiduciary duties.

Most of those convicted have been sentenced to prison for two to five years. The maximum penalty for financial crimes in Iceland is six years, although their Supreme Court is currently hearing arguments to consider expanding sentences beyond the six year maximum.

...end drift

Quote:

It arises from the fact that the crashes of 2008 were not a conjunctural crisis, but a fundamental breakdown of the global capitalist system, which has continued to deepen."

Quote:

...the rule of the bourgeois democrats, from the very first, will carry within it the seeds of its own destruction...Karl Marx and Frederick Engels - Address of the Central Committee to the Communist League, London, March 1850

Better late than never.

I don't believe there will be a collapse. Everyone knows Greece can't payback it's debt. It doesn't matter. As long as it is still on the books it "exists".

The US will never pay it's debt to China but it doesn't matter. As long as it is still on the books it contributes to China's net wealth. As long as they keep lending to the US, the US keeps buying Chinese goods. As long as the US exists it's it assumed it will be repaid even if it is in 200 years from now, or 1000. They don't even bother printing enough money to represent it's existence. It only exists in numbers on ledgers.

In 1990 Canada paid $1.76 million for this painting called "Voice of Fire".

What wisdom 24 years do bring. Recently, a senior member of today’s National Gallery personnel mentioned to me, off the record, that Voice of Fire is “worth well over $40 million today.”

In fact, earlier this year a Newman painting sold at auction in New York City for $84.2 million US (the currency of international art sales). That doesn’t mean Voice of Fire is worth as much, but it’s very conservative to estimate its value at $50 million US. Not a bad return on $1.76 million CDN over 24 years.

Oligarchs are fine with individual countries collapsing but they won't allow the world wide system to collapse.

It would be a good thing if it really did collapse because it would reset everything. No one would owe anyone else anything. Like bitcoins we would create a new symbolic currency perhaps basing it on gold again, or something else.

Unlike the Voice of Fire, genuine wealth is not so easily destroyed. The buildings we live in, buses and trains, factories don't just vanish, we don't lose the value of our labour. If the system did collapse North America would reorganize in a matter of days to keep everything running. The governments would create a new continental currency.

These people:

The report by the left-leaning Canadian Centre for Policy Alternatives shows that the country's 86 richest individuals and families -- or 0.002 per cent of the total population -- are getting exponentially richer and now have accumulated as much wealth as the country's poorest 11.4 million.

That's more than in 1999, when the richest 86 had as much money as the poorest 10.1 million and enough to buy up everything in New Brunswick and still have about $40 billion left over, according to the report, to be released Thursday....

In fact, the super-rich list of Canadian residents has little to do with income in the traditional sense, he said. None of the 86 are company CEOs -- often the poster children of the Occupy crowd for their unseemly salaries and bonuses. Instead, the ones on the list are there by virtue of being company founders or related to company founders.

The super-rich have gotten there by creating and trading assets, whether companies, real estate or securities.....

But Statistics Canada also showed wealth gravitating to the top. While median net worth rose almost 80 per cent since 1999 to $243,800 per family unit, the top 40 per cent possessed 88.9 per cent of total net worth, leaving the bottom 60 per cent with a mere 11.1 per cent of the pie.

http://www.ctvnews.ca/business/canada-s-richest-86-have-as-much-wealth-a...

...will make sure the system always favors them until we claim the power we have through democracy.The super-rich have always been afraid we will rise up but we never do.

01:59 28.10.2015Get short URL 131911The United Kingdom’s steel industry is on the verge of collapse if the UK government does not step in, the head of the industry lobby group said as quoted by local media.

LONDON (Sputnik) – Falling global steel prices forced a number of British steelmakers to shut down or lay off over 4,000 employees, or 15 percent of the sector’s workforce.

"We are bleeding very quickly and unless it’s stopped very soon we are likely to die," UK Steel director Gareth Stace was quoted as saying by The Financial Times in an address to the parliamentary select committee on Tuesday.

Dozens of steelworkers are planning strikes outside Westminster in London on Wednesday, demanding Prime Minister David Cameron and his government to save the industry.

Read more: http://sputniknews.com/europe/20151028/1029204651/uk-steel-industry-collapse.html#ixzz3pwg87Cxv