f you were waiting for a “black swan event” to come along and devastate the global economy, you don’t have to wait any longer. As I write this, the price of U.S. oil is sitting at $45.76 a barrel. It has fallen by more than 60 dollars a barrel since June. There is only one other time in history when we have seen anything like this happen before. That was in 2008, just prior to the worst financial crisis since the Great Depression. But following the financial crisis of 2008, the price of oil rebounded fairly rapidly. As you will see below, there are very strong reasons to believe that it will not happen this time. And the longer the price of oil stays this low, the worse our problems are going to get. At a price of less than $50 a barrel, it is just a matter of time before we see a huge wave of energy company bankruptcies, massive job losses, a junk bond crash followed by a stock market crash, and a crisis in commodity derivatives unlike anything that we have ever seen before. So let’s hope that a very unlikely miracle happens and the price of oil rebounds substantially in the months ahead. Because if not, the price of oil is going to absolutely rip the global economy to shreds.
What amazes me is that there are still many economic “experts” in the mainstream media that are proclaiming that the collapse in the price of oil is going to be a good thing for the U.S. economy.
The only precedent that we can compare the current crash to is the oil price collapse of 2008. You can see both crashes on the chart below…
Boom Goes The Dynamite: The Crashing Price Of Oil Is Going To Rip The Global Economy To Shreds.
The road to ruin is on plain display and the playbook is easily seen at this juncture. Let’s take a look at how that playbook will unfold. Contrary to popular outrage of the SOLUTION being IMPOSED it is the correct one once the insured depositors where PROTECTED. In this edition the elites suffered FIRST followed by the private sector depositors who foolishly believed false BALANCE sheets which were POLITICALLY CORRECT but PRACTICALLY incorrect fictions approved by fiduciarily (regulations and regulators allowed ONGOING insolvent operations rather than protect the public by ending and prohibiting them) challenged governments (work for the banks and crony capitalists not for the public at large).
The pecking order of the losses was the CORRECT one: Shareholders FIRST, bondholder’s second and lastly uninsured depositors. Have we seen this anytime since the crisis began? It is clear that this is and what must be what’s done in the future. But for the countries in question to RECOVER they must RECOVER the ability to PRINT and devalue their currency to competitiveness.
Ask Iceland and Greece how the different paths turn out? Iceland (wiped out bond holders, shareholders, prosecuted the banksters and devalued its currency and is in RECOVERY mode), versus Greece (where the Troika holds all the debt, refuses to take a haircut, the bank shareholders and current bondholders (TROIKA) are intact, is forcing INTERNAL devaluations (to get their new slaves in line) rather than external and is in a perpetual DEPRESSION). Let’s look at how this is reflected in employment courtesy of http://www.zerohedge.com:……………………………………
fullarticle at source: http://www.marketoracle.co.uk/Article39809.html
By Christopher M. Quigley
There are very few heroes in economics but for me one of the patron saints of that profession should be Nikolai Kondratiev who was shot by firing squad on the orders of Stalin in 1938. He died for what he believed was the truth. His execution was ordered because his academic work propounded that the capitalist system would not collapse as a result of the great depression of 1929. This truth Stalin did not want to hear, thus Nikolai was exterminated and his work suppressed for over two decades.
full article here in PDF : Kondratieff_Waves_and_the_Greater_Depression_of_2013
By David Mc Williams
Last Friday’s Financial Times contained an article which suggested that the Republican Party is seriously thinking of returning the US to the gold standard, and that it will discuss this idea at the annual party convention in Tampa this week.
Many people will react to this radical idea by asking if the Republicans have learned anything at all from history. But do they actually have a point?
Surely anyone with a grasp of economic history knows that strict adherence to the gold standard, with the balanced budget mantra, at a time of asset price deflation in the early 1930s exacerbated the recession, which morphed into the Great Depression. But is the case as open and shut as that?
While the lessons of that era are reasonably well accepted, there are also those who will rightly point out that, whatever about the 1930s, anyone with a grasp of recent economic history can see that the massive quantitative easing of the past five years has had little or no effect, other than facilitating a massive increase in the US’s national debt.
full article at source: http://www.davidmcwilliams.ie/2012/08/27/going-for-gold
IMF wants the world to save Europe … Christine Lagarde, the managing director of the IMF, said the escalating crisis now needed to be addressed as “collectively as possible” … The European financial crisis is “escalating” and is so serious that it is unlikely to be solved by eurozone countries alone, the head of the International Monetary Fund warned Thursday night. British taxpayers are now likely to be involved in an internationally co-ordinated bail-out led by the International Monetary Fund [IMF] for countries in the single currency. Christine Lagarde, the managing director of the IMF, said the escalating crisis now needed to be addressed as “collectively as possible”. Without action, the world faces the spectre of a 1930s-style depression, she said. – Montreal Gazette/UK Telegraph
full article at source:http://www.thedailybell.com/3356/Out-of-Chaos-Order-Now-IMF-Seeks-Collective-World-Bail-Out-of-Europe
By the Daily Bell
The Bank for International Settlements Sunday issued an oblique endorsement of coordinated action by the world’s largest central banks to ease funding conditions for banks. “A freezing of interbank markets in major funding currencies, as during the recent crisis, may require the ability to supply official liquidity in major currencies in an elastic manner,” the BIS wrote in its regular quarterly report.” – MarketWatch
Dominant Social Theme: Inflate! And everything will work out.
Free-Market Analysis: We’ve already indicated that we believe the Anglosphere power elite is attempting to create a kind of Great Depression in order to ease the path of world government. This squib of an article in MarketWatch (excerpted above) – unnoticed by most of the mainstream press – only reconfirms our impression.
It endorses recent “coordinated” central banking loosening. But it does more: “A freezing of interbank markets in major funding currencies, as during the recent crisis, may require the ability to supply official liquidity in major currencies in an elastic manner.”
Think about that. The BIS, whatever it is, is all for printing lots of money. And the BIS is no small-time trade group. It is perhaps the most powerful (and least known) global business body in the world. Its mysteries are manifold. its workings are well-hidden.
Of course, somebody actually set up the Bank for International Settlements in the late 1930s. And since then someone has set up or helped set up about 200 central banks around the world, many of them reporting directly to the BIS.
full article at source :http://www.thedailybell.com/3339/BIS-Calls-for-Hyperinflationary-Depression