Filed under: bernanke, BIS, Britain, central bank, China, Credit Crisis, DEBT, ECB, Economic Collapse, economic depression, Economy, Europe, european central bank, european union, Federal Reserve, food crisis, food market, food prices, food shortage, gold, Great Depression, Greenback, housing market, imf, Inflation, Japan, morgan stanley, real estate, Stock Market, United Kingdom, US Economy | Tags: corn, OTC, royal bank of scotland
RBS issues global stock and credit crash alert
London Telegraph
June 18, 2008
The Royal Bank of Scotland has advised clients to brace for a full-fledged crash in global stock and credit markets over the next three months as inflation paralyses the major central banks.
“A very nasty period is soon to be upon us – be prepared,” said Bob Janjuah, the bank’s credit strategist.
A report by the bank’s research team warns that the S&P 500 index of Wall Street equities is likely to fall by more than 300 points to around 1050 by September as “all the chickens come home to roost” from the excesses of the global boom, with contagion spreading across Europe and emerging markets.
BIS Warns Of Great Depression
Banking Times
June 11, 2008
The Bank for International Settlements (BIS), the organisation that fosters cooperation between central banks, has warned that the credit crisis could lead world economies into a crash on a scale not seen since the 1930s.
In its latest quarterly report, the body points out that the Great Depression of the 1930s was not foreseen and that commentators on the financial turmoil, instigated by the US sub-prime mortgage crisis, may not have grasped the level of exposure that lies at its heart.
According to the BIS, complex credit instruments, a strong appetite for risk, rising levels of household debt and long-term imbalances in the world currency system, all form part of the loose monetarist policy that could result in another Great Depression.
The report points out that between March and May of this year, interbank lending continued to show signs of extreme stress and that this could be set to continue well into the future.
It also raises concerns about the Chinese economy and questions whether China may be repeating mistakes made by Japan, with its so called bubble economy of the late 1980s.
Notional Value Of Derivatives Hits One Quadrillion
Jim Sinclair
JS Mineset
June 11, 2008
The notional value of all outstanding derivatives now totals approximately $1.144 QUADRILLION.
This appears to be Bank of International Settlement Spin to announce the largest gain in derivatives outstanding since they started to report. As of the last report it appeared that both listed and OTC derivatives was under $600 trillion. Now listed credit derivatives alone stood at $548 Trillion. The OTC derivatives are shown as $596 trillion notional value, as of December 2007. One can only imagine what number they are at now.
Well we hit a QUADRILLION. We have more than $1000 trillion dollars in all derivatives outstanding. That is simply NUTS because notional value becomes real value when either counterparty to the OTC derivative goes bankrupt. $548 trillion plus $596 trillion means $1.144 quadrillion.
It would be an interesting piece of research to see what the breakdown is of listed derivatives according to exchange to see if it adds up to the reported number. Spin is now everywhere.
This means that no OTC derivative house can be allowed to go broke. This means that whatever funds are required to rescue failing international investment banks, banks and financial entities will be provided.
Keep this economic law in mind. Monetary inflation proceeds price inflation and is its primary cause in economic history from Rome to present.
Nothing can stop the juggernaut of price inflation heading towards every nation like a runaway freight train down a mountain.
Gold is going to at least $1650. I am probably way too low with that estimate.
The US dollar will trade down to at least .5200 as measured by the USDX.
Policy-makers around the globe declared soaring inflation a top threat on Monday, with pressure rising for central banks to raise interest rates amid protests against higher costs of living.
Gold is the easiest market to trade for the aggressive investor. Sell 1/3 when the market looks like a Rhino Horn which you will see with your French Curves at the point of the rollover.
Buy 1/3 back when the price of gold looks like a fishing line hanging off a fishing rod. Your maximum power down trend line will give you this.
Related News:
http://news.yahoo.com/s/nm/20080616/b..3n0dX.bIygjaM4as0NUE
Morgan Stanley warns of ’catastrophic event’ as ECB fights Federal Reserve
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/16/bcnecb116.xml
Washington Post says Bernanke will not raise rates
http://www.reuters.com/article/ousiv/idUSN1647075820080616
Bank Robberies Up Around USA
http://www.usatoday.com/news/nation..ankrobberies_N.htm?csp=1
IMF Economist Calls For World Currency
http://www.atimes.com/atimes/Global_Economy/JF06Dj04.html
Corn Jumps To Record
http://biz.yahoo.com/ap/080612/commodities_review.html?.v=3&printer=1
Inflation jumps by biggest amount in 6 months
http://news.yahoo.com/s/ap/2..CNtc5x1gy4CWdv24cA
US trade deficit jumps to 60.9 billion dollars
http://rawstory.com/news/afp/US_trad.._06102008.html
Zimbabwe faces worst harvest on record
Global food supply is a growing problem
NY Fed Chief Urges Global Bank Framework
Food Scarcity ’Creating New World Order’
AFGHANISTAN: Over 3.5 million at” high risk” of food insecurity – ministry
Water Crisis To Be World’s Big Risk
U.S. Banks Hiding $5 Trillion
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