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Global financial system implosion begins

not-bono-ever said:
Wires saying fat finger trigger accident caused based carnage blip. totes unsound gossip says thin volumes at that time of the morning may have proved too much of a lure for a rascal to move the market and take advantage.No idea where this is coming from
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Looks like algos trading a market with very little liquidity! Very low volume for a move of that size. My broker quoted 1.0529 as the low!!
 
The usual suspects involved! Morgan Stanley / UBS

big.jpg
 
Well after the 'blip' sterling is still trading at 2% below what had previously been a 30 year low. Isn't this sort of volatility to be expected in the current circumstances? The Tories are playing to a right-wing populist agenda that doesn't reflect the interests of big business and the markets are spooked.
 
Has anyone seen anything good on the devaluation of sterling and inflation?

chart

This has to lead to inflated prices soon right?
 
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eoin_k said:
Has anyone seen anything good on the devaluation of sterling and inflation?

chart

This has to lead to inflated prices soon right?
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The long run impact of high import prices is that firms substitute their foreign purchases with domestically produced goods. This is a good thing as it means stronger domestic demand and increased production. That increase in production then brings down prices.

Our currency has been overvalued for a long time, and that is why we have run a trade deficit for so many years. Things will change for the better if the devaluation turns out to be a long term thing. We can't make any worthwhile conclusions just by watching day to day changes in exchange rates though. That's not how these things work.
 
Worries Deepen That Globalization Is Hitting the Skids (WSJ)
06/10/16
Global finance ministers and central bankers are descending on Washington this week with a central concern in mind: fear that the modern age of globalization is hitting a wall. Last year’s $646 billion in foreign direct investment in rich economies represents a 40% drop from the peak before the financial crisis. International lending, as measured by cross-border banking claims at the Bank for International Settlements, is down nearly $2.6 trillion, or 9%, over the past two years. International trade this year will grow at the slowest pace since 2007, according to the World Trade Organization, which has slashed its forecast for growth in global trade volumes to 1.7% in 2016 from a previous estimate in April of 2.8%.

Imports among the world’s 20 largest economies have fallen as a share of their GDP for four consecutive years, and growth in demand for shipping containers fell to 4% this year after four decades of double-digit expansion. As financial officials gather in the U.S. capital this week at semiannual meetings of the IMF and the World Bank, there is widespread concern that this global malaise could worsen if nations intentionally turn inward. Too many politicians are backing trade barriers in a misguided effort to boost national growth in the short term, said Roberto Azevedo, director general of the WTO. “The medicine that is being often prescribed is protectionism, and that is exactly the kind of medicine that is going to hurt the patient, not help him,” he said.
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EU imposes import duties of up to 73.7% on cheap Chinese steel
Friday 7 October 2016

This was the week the world got really anxious about Globalization's future.
October 8, 2016
Weak global trade, fears that the U.K. is marching towards a hard Brexit, and polls indicating that the U.S. election remains a tighter call than markets are pricing in have led a bevy of analysts to redouble their warnings that a backlash over globalization is poised to roil global financial markets—with profound consequences for the real economy and investment strategies.

From the economists and politicians at the annual IMF meeting in Washington to strategists on Wall Street trying to advise clients, everyone seems to be pondering a future in which cooperation and global trade may look much different than they do now.
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Another interview with Michael Hudson.
The Great Recession Hasn’t Really Ended
October 7, 2016
 
...quoting from above....

The central bank already holds over €1 trillion of bonds bought at "artificially low" or negative yields, implying huge paper losses once interest rates rise again. "An exit from QE policy is more and more difficult, as the consequences potentially could be disastrous," he said.

...according to some of the commentators Max Keiser is featuring the next stage of kicking the can down the road following the nationalisation of bankrupt private bank assets onto Central Banks balance sheets is to sort of push them all up to the next supra-national / IMF level

We also discuss the solution that the leading global powers will present: rolling up the world’s bad debt into the Special Drawing Rights (SDR), which is why China has been buying SDRs on the market.

[KR940] Keiser Report: Gold & World’s Debt Problems | Max Keiser
 
Is this the slow motion implosion then.....judging by the age of this thread. Or is capitalism an endless financial toppling over, always unsustainable, always depending on extracting more and more from the earth's natural environment until the point where insurers (retrocessionaires) of the system begin to demand higher premiums for the risk of environmental toppling.
 
hot air baboon said:
....he interviews alot of people who are interesting & no one else gives any exposure to...
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On his show on Russia Today? I used to regularly read zerohedge and maxkeiser but the politics is suspect and their predictions were well off.

Take everything with a pinch of salt as n-b-e said.
 
campanula said:
Isn't a lot of this stuff an economics version of the Rapture? End of days chiliastic orgasms.
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I'm no expert on the global economy or the financial industry, so I could be utterly and comprehensively wrong. I welcome any constructive criticism. My understanding is thus:

The problems in the financial sector which lead to the Great Recession beginning in 2008 (and which is still kinda-sorta going on eight years later) have not been addressed on a fundamental level. What instead happened was a combination of wallpapering over the cracks, and politicians blaming previous governments for incurring debt (despite the fact that economies across the world have happily trundled along with much higher debt levels) and then using that narrative to cut things to the bone. This is a combination that at best kicks the can further down the road and at worst, actively stores up trouble for the future as the effects of austerity and of banks being allowed to more or less carry on as before continue to make themselves felt.

Even in the worst case scenario, it's not Armageddon. But future events don't have to be apocalyptic in order for anyone to have reasonable dread of their imminence, especially if one is a member of that part of society most liable to get it in the neck should the economy descend (or be pushed!) further into the shitter than it already has.
 
Ah, Noxion, I am not referring to the wider effects of economics (although I still question whether most classical economics has any validity as some sort of reliable scientific theory and not fantasy obscurantism)...just the rash of often lurid articles which gleefully threaten us with doom and destruction. I am far, far more exercised about the environmental depredations of uncontrolled capitalism than about imaginary monetary configurations.
Wealth exists in fertile topsoil and a healthy biosphere...not some crappy bond scheme.
 
campanula said:
Ah, Noxion, I am not referring to the wider effects of economics (although I still question whether most classical economics has any validity as some sort of reliable scientific theory and not fantasy obscurantism)...just the rash of often lurid articles which gleefully threaten us with doom and destruction. I am far, far more exercised about the environmental depredations of uncontrolled capitalism than about imaginary monetary configurations.
Wealth exists in fertile topsoil and a healthy biosphere...not some crappy bond scheme.
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Sounds like you just prefer your apocalyptic fantasies to have an environmental flavour, to be honest.

Let me be clear, that while many current practices relating to the environment (including but by no means limited to e.g. climate change and topsoil erosion) aren't without their massive problems that will negatively affect the quality of life of billions across the globe, histrionic screeching about the Revenge of Gaia is just as wrong and pointless as the maundering of those survivalist wankbags who near the start of this century predicted that by now Peak Oil would have us living in a post-apocalyptic dystopia populated by steely-eyed sociopaths who would slit your gizzards for a dribble of muddy water. Those who don't find such self-flagellating misanthropy appealing will remain unconvinced, and for those who do find the message credible the likely outcome is paralysis, because if the world is inevitably fucked, why bother trying to save it?

Either the world can be fixed, in which case dwelling on the worst case scenarios is morbidly misguided at best and actively perverse at worst, or the world can't be fixed, so why bother spending the last days of the good times worrying about the inevitable?

Plus I'm suspicious of the fact that in pretty much every generation there has been certain segment of the population convinced that they were living in the End Times, and in every case they have been utterly wrong.
 
I am not really having apocalyptic fantasies of any stripe, to be honest. I certainly don't subscribe to end time fatalism but I recognise changes will be either voluntarily adopted or forced upon us...but everywhere, I see resilience alongside despair...so I think that many of the predictive essays of the type I was initially referring to don't have much validity since they are embedded within a (economic) framework which is already failing. I sincerely hope you are not putting me in some hardcore Gaian environmentalist box, Noxion...I am merely a gardener and fully understand that soil fertility has more relevance to great swathes of humanity than investment opportunities since we all need to eat.
 
NoXion said:
Sounds like you just prefer your apocalyptic fantasies to have an environmental flavour, to be honest.

Let me be clear, that while many current practices relating to the environment (including but by no means limited to e.g. climate change and topsoil erosion) aren't without their massive problems that will negatively affect the quality of life of billions across the globe, histrionic screeching about the Revenge of Gaia is just as wrong and pointless as the maundering of those survivalist wankbags who near the start of this century predicted that by now Peak Oil would have us living in a post-apocalyptic dystopia populated by steely-eyed sociopaths who would slit your gizzards for a dribble of muddy water. Those who don't find such self-flagellating misanthropy appealing will remain unconvinced, and for those who do find the message credible the likely outcome is paralysis, because if the world is inevitably fucked, why bother trying to save it?

Either the world can be fixed, in which case dwelling on the worst case scenarios is morbidly misguided at best and actively perverse at worst, or the world can't be fixed, so why bother spending the last days of the good times worrying about the inevitable?

Plus I'm suspicious of the fact that in pretty much every generation there has been certain segment of the population convinced that they were living in the End Times, and in every case they have been utterly wrong.
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apols, Noxion - forum etiquette quote fail
 
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