Wednesday, February 10, 2016

THE ECONOMY MAY CRASH IN AS FEW AS 48 HOURS

Let's just get on with this thing!  Bishop Koyle said it would come down overnight like a house of cards.  This whole thing needs to die in order to kill the parasite that is living off of it.  You cannot put new wine into old bottles:

“It May Take Less Than 48 Hours to Take it All Down” – Bill Holter

Wednesday, February 10, 2016 11:22
amp;cb=INSERT_RANDOM_NUMBER_HERE" ><img src="http://ox-d.beforeitsnews.com/w/1.0/ai?auid=326914&cs=5125e7a33c8bf&cb=INSERT_RANDOM_NUMBER_HERE" border="0" alt=""></a> More frightening news, Bill Holter says when it all comes crashing down, it will do so quickly, in a matter of 2 days only if Bill is correct?!
We can only imagine the hell that will then break loose!
Meanwhile, Japan just took a stock market toilet flush, and Deutsche bank should be trembling?!
Are we almost there yet? Yeah, you better believe it?
Silver Doctors - Whether you want to see it or not, the financial system is in a forced unwinding.
It took some 70 years to build this great credit edifice.
When it goes it may take less than 48 hours to take it ALL down.

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Submitted by Bill Holter, JSMineset:
After my last article we received two logical questions from readers. The first one pertaining to “gaps” and the Deutsche Bank derivative exposure, the second pertaining to Japan’s strong currency with negative yields while the debt to GDP levels are astronomical. Below is the first question;
“In the past you have warned about derivative exposure and now gapping.
One of my worst fears as a day trader on a derivatives platform is gapping. That is why I will never have an open position when the market is closed. Even then, that is not guaranteed.
A lot of trading platforms got hammered when the Swiss franc was revalued.
Could you put out a letter for your readers explaining why for example the Deutsche Bank derivatives exposure is so dangerous in terms of gapping.”
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In my opinion, this is a very astute observation. The reader will not carry overnight positions because as he says, “the Swiss franc revaluation killed many” within less than 10 minutes of the markets opening. That said, even if not in any overnight position and the great leveling moment comes, how does anyone know if their broker even survives the carnage …with YOUR MONEY?
But this is another topic entirely.
As for Deutsche Bank, we know they have been recently screaming about negative interest rates hurting their operations. This very well may be so, but it is my opinion it is not so much negative interest rates killing them. I believe it is off balance sheet derivatives. Not only has DB denied any problem, the German finance minister has now chimed in with reassurance! http://www.zerohedge.com/news/2016-02-09/german-finance-minister-joins-db-ceo-says-not-worried-about-deutsche-bank Where have we seen this before? Does Bear Stearns or Lehman Bros. ring a bell?  Doth the Germans protest too much? By the way, their credit spreads are stretching out, and stock price has now taken out the 2008 lows!
The second question regarding confusion of Japan’s 10 yr. yield hitting 0% and their currency strengthening while being the fiscal basket case of the world is also a good one but very simple to explain. http://www.zerohedge.com/news/2016-02-08/japanese-10y-yield-hits-zero-first-time-ever-yen-strongest-2014-stocks-crash. Japan has a debt to GDP ratio of 260%, if you add in corporate debt it approaches 400%, how could they not have a crashing currency and 20% (or higher) interest rates? The simple answer is this, the global “carry trade” is unwinding. The Japanese yen was a major tool used to create and float the carry trade which inflated assets. Now, as asset prices are falling, this trade is being unwound (think of it as a margin call). Previous yen that were borrowed are now being bought back to settle the trade. This was a synthetic short similar to the dollar short being covered. A quick question and very short answer, why would anyone in their right mind invest money for 10 years at zero percent in a currency who’s issuer publicly states their goal is to grossly debase? Answer: BECAUSE THEY HAVE TO!

2 comments:

  1. Sure, it's expected to tumble, but it won't completely crash. That will only happen after the church calls for a exodus of sorts and moves people to safety.

    Do not fear. Use this time to prepare.

    ReplyDelete
  2. Do you think that the economy will be artificially propped up through the Presidential election ? (I think Hillary will win....yikes !!)
    I am hesitant to even go in on a rental property or other investment............. any thoughts ?

    ReplyDelete