If corporations are providing billions to fledgling Cannabis companies now, imagine how much money will go into industry when it becomes legal for banks

12:29 PM banks, beer, cannabis, capital, industry, legalization No Comments

The growing legalization of cannabis in states around the country is leading the U.S. to perhaps one day experience a revolution, and the potential for ground floor growth in an industry that will encompass agriculture, medicine, cuisine, and even alcoholic beverages just to name a few.

However because the Federal government has been apathetic in pushing forth full legalization, and most banks and venture capitalists have been extremely hesitant in providing capital to grow this industry in the U.S., nations like Canada are running away with cannabis expansion where even beer companies are willing to provide billions of dollars in capital to grab their share of the 'roadside weed'.

Despite falling short on quarterly earnings expectations, Canadian-based Canopy Growth, the world's highest valued marijuana stock, skyrocketed on Wednesday after the maker of Corona beer invested $5 billion Canadian, which is nearly $4 billion U.S. 

The giant injection of cash from Constellation Brands is the largest strategic investment in the cannabis market to date, and comes at a time when alcohol companies are making large ventures into the industry. 

"We're going to spend that money to be around the globe," Canopy Growth CEO Bruce Linton told CityNews on Thursday. - NPR

In part it is the lack of foresight, and the corruption of bought and paid for legislators in Washington that is keeping America from rebuilding their economy in new industries such as cannabis.  Instead President Trump is trying to 'Make America Great Again' by focusing on old manufacturing industries such as steel and automobiles and forgetting that the largest industry outside of technology is Big Pharma.  But to break this paradigm, the government needs to open up the financial sector to cannabis investment, and help direct capital into the economy rather than its continued use in the financialization of Wall Street.

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U.S. Treasury bond scheme perfect when the buyer can simply print money out of nothing to scoop them up, and does not care at all about profit

10:39 AM bond yield, bonds, central banks, china, debt, fed, profit, scheme, trade war, treasuries No Comments

With Russia, Turkey, and now Japan all dumping their Treasuries (dollar reserves), one of the biggest questions haunting Wall Street is, who exactly are buying these bonds to help keep yields down?

We raise this query in light of discussions that are now occurring among analysts for not if China will start dumping their estimated $1.3 trillion worth of dollar reserves in an effort to both protect their currency, and to harm the U.S. in the ongoing trade war, but when.

I often read that China may retaliate against US trade sanctions by further decreasing their US Treasury holdings, sending Treasury yields significantly higher, thus blowing out US deficit spending on interest payments.  Trouble is, Chinese Treasury holdings peaked in 2014 (on an annualized basis) and have been declining since.  The Chinese have not only ceased accumulating US Treasury debt, despite continued record trade surplus' with the US resulting in significant dollar surplus', but have been decreasing their holdings.  All this, according to the Treasury International Capital (TIC) system. 

But this postulation that the Chinese could wound the US via selling a portion (or all) of its Treasury holdings (as Russia recently did) is submarined by the recent actions of the Federal Reserve.  I say this based on the magnitudes greater accumulation and subsequent dumping of specific maturities of US Treasury debt done by the Federal Reserve. 

The Federal Reserve accumulated almost $800 billion in 7 to 10 year US Treasury debt (red line, chart below) from 2009 to 2013, and then subsequently dumped $600 billion from early 2014 through the most present August 2018 data.  And the impact on the 10 year yield (blue shaded area, chart below)...essentially zero.  Yes, while the Fed rolled off and/or sold off 7 to 10 year holdings, they were busy buying short term debt.  But this still meant someone had to step up in duration and buy all that longer duration debt the Fed no longer wanted. - Economica

Central banks across the board have been buying sovereign bonds going back to the original days of Quantitative Easing 1 (QE1), with the three most public entities being the Fed, the Bank of Japan, and of course, the ECB.  But with most of these institution's balance sheets having skyrocketed at least 500% or more higher than they were at the time of the 2008 financial collapse, how exactly could they afford to buy more if nations holding these bonds began to sell them?

Perhaps this is one of the primary reasons why the Fed chose to remove its Live balance sheet accounting recently, which had been monitoring in real time their supposed 'tightening' of their balance sheet over the past year.  Because if they are telling the markets that they are doing one thing, and then behind the scenes doing something else, it would destroy investor sentiment in their ability to manage the system, and result in helping to accelerate market forces such as inflation and higher yields.

In short, Bernie Madoff would blush at the farce that is now the US Treasury market (further manipulating all downstream interest rate sensitive markets). A little lie or meddling led to more lying and more meddling...and suddenly the free market no longer exists. It should be clear that a buyer without profit motive is intervening in the Treasury market to maintain a bid and sustain continued low rates on US debt...all this because America has matured but those in control still want to synthetically maintain growth rates (hello China) via unrestrained debt issuance.

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Islamic terror cell compound mysteriously vanishes overnight as questions arise for whether this was a Deep State funded group

10:18 AM 9/11, aurora, bail, compound, deep state, fbi, islamic terrorist, new mexico, sandy hook, terror cell No Comments

On the surface it appeared that the Islamic compound in New Mexico was little more than a rag-tag group of individuals who hated America and wanted to train children to conduct terroristic acts.  However following the bizarre ruling by a local judge to allow these individuals to go free on bail despite the overwhelming amount of evidence presented of a planned attack provided by the Prosecution, what perhaps brings even more questions to this equation is how the compound was suddenly destroyed and removed within a day.

New Mexico authorities have executed a court order to destroy an encampment where the son of a famous New York Imam ritualistically murdered his three-year-old son and trained nearly a dozen other children to commit school shootings, according to Taos, NM prosecutors. 

The decision to raze the compound is the latest controversial development in the case, after New Mexico judge Sarah Backus on Monday ordered four out of five alleged Muslim extremists free on a $20,000 "signature bond" (meaning they didn't have to pay), including the suspect in his son's murder, Siraj Ibn Wahhaj - Zerohedge

Like many events such as the Las Vegas massacre, Aurora shooting, and even Sandy Hook, evidence shows that there is often more to the story than what law enforcement tells the public, and where basic logic facilitates people to question the narrative given by the Establishment.

Ie... Why were there ongoing Federal exercises occurring during the same weeks or even days that the events of 9/11, the Boston Marathon Massacre, the Las Vegas Shooting, and even Sandy Hook in those locations?

The bottom line is that through the internet, and the rise of the alternative media, people are now questioning when anomalies take place, such as with this judge in New Mexico allowing the potential terrorists to go free and then have all the evidence destroyed in their compound before Prosecutors can glean all the facts in preparation for trial.  And that same logic dictates that perhaps individuals in government were involved in some capacity with this terror cell, especially since nearly all 'arrests' that have occurred from 'thwarted terrorists' have all had an FBI or other agency contact which pushed them towards the actions they nearly took.

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Shotgun Economics update for August 16 2018 - Financial Markets and Economic Wrapup

2:26 PM central banks, dollar, emerging markets, gold, gold price, liquidity crisis, shotguneconomics, stocks, turkey No Comments

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Ivy league Professor wishes for economic crash simply so Trump will lose in 2020

11:41 AM 2020, cornell, economic collapse, economics, election, president trump, recession, trump derangement syndrome No Comments

You have to wonder what the value of an Ivy League education is worth these days when they will give out Law Degrees to the barely literate Maxine Waters, and of course an Economics Degree to the completely ignorant Alexandria Ocasio-Cortez.  But judging from recent remarks from an Associate Economics Professor from Cornell University, perhaps we don't to wonder much at all.

This is because Professor Steven Kyle wrote in an op-ed recently that he wishes for the next economic collapse to occur soon so that it might kill the chances of Donald Trump winning the Presidency again in 2020.

I hope to god we have a downturn when Donald Trump goes up for reelection. The political models say that rate of change is highly correlated to throwing out an incumbent. Not that I hope for people to lose jobs, but I sure do hope for all our sake's we get rid of that guy. - Salon

And Trump Derangement Syndrome motors on. 

We wonder if Professor Kyle had the integrity to speak out against Obamacare, or if his economic knowledge is limited to just political motivations rather than through the study of real statistical data.

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Even CNBC is admitting central banks are dumping gold to suppress prices so that people will remain in collapsing currencies

10:46 AM 2008 financial crisis, bis, central banks, emerging markets, gold, gold price, gold price manipulation, gold suppression, liquidity crisis No Comments

In many instances history does repeat itself, but more often it is because those who do not learn from the past tend to do the same things over and over expecting a different result.

Back in 2008 when the world was starting to experience a global liquidity crisis, central banks dumped huge amounts of gold onto the markets at a time when the public was on the verge of exchanging their fiat currencies for gold.  And this was seen in how the price of gold went from $1020 per ounce down to $700.

In 2008, gold was taken from $1020 to $700 and silver was pounded from $21 to  $7 during the period of time that Bear Stearns, Lehman and the U.S. financial system was collapsing.  The precious metals were behaving inversely to what would have been expected as the global financial system melted down.   Massive Central Bank intervention was at play. – Investment Research Dynamics

Of course once the liquidity crisis went into full swing, central banks had to switch gears and begin a program of extreme money printing which led the gold price to skyrocket to $1940 less than three years later.

Fast forward to August 2018

Over the past 30-45 days, signs of a new liquidity crisis in the emerging markets has arisen in country's like Argentina and Turkey, causing the dollar to soar to levels not seen in nearly two years.  And as before during the last global liquidity event, central banks are once again dumping gold, even to the point where the Establishment's mouthpiece CNBC is admitting it is occurring.

"There's some central bank selling (of gold) out of the emerging markets," said RJO Futures' Alex Turro. "The emerging markets are rolling over with the lira."
Bullion has declined about 9 percent this year, pressured by rising U.S. interest rates, a soaring dollar and failure to capitalize on its traditional role as a hedge against global uncertainties. 

Investors have opted for U.S. Treasuries, seen as the ultimate safe haven, which meant they had to buy dollars, while bearish sentiment on gold led to liquidations in exchange-traded funds (ETFs) and a record level of short positions. - CNBC

Interesting as well, it also appears that gold price suppression is not just limited to emerging market central banks as GATA has confirmed that the Bank of International Settlements (BIS) has been dumping gold into the markets since July.

Meanwhile, behind the scenes, the Bank of International Settlements (BIS) has been actively intervening in the physical gold market during July, as detailed by Robert Lambourne, a consultant to GATA: 

Use of gold swaps and gold derivatives by the Bank for International Settlements, the gold broker for most central banks, increased by about 17 percent in July, according to the bank’s monthly report…The BIS’ July Statement of Account gives summary information on its use of gold swaps and gold-related derivatives in the month. The information is not sufficient to calculate a precise amount of gold-related derivatives, including swaps, but the bank’s total estimated exposure as of July 31 was about 485 tonnes of gold versus about 413 tonnes as of June 30. 

That is an increase of about 72 tonnes or 17 percent. The increase came as there increasingly appeared to be a correlation between the gold price and the valuation of the Chinese yuan, both of which fell substantially during the month.
The BIS refuses to explain what it is doing in the gold market and for whom, engendering suspicion that it is helping one or more of its members to manipulate the currency markets through deception.  To place the bank’s use of gold swaps in context, its current exposure of 485 tonnes is higher than the gold reserves of all but 10 countries. (documentation and links: BIS gold market intervention increased by 17% in July 

Like in 2008, gold price manipulation will only work for so long, especially since supplies of the precious metal are much tighter than a decade ago, and global debt is upwards of five times greater.  And for those who are students of history, the price suppression that is going on right now offers an extraordinary buying opportunity in what is to come for the precious metal, and for fiat currencies.

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Shotgun Economics update for August 15 2018 - Financial Markets and Economic Wrapup

2:09 PM banks, bitcoin, cryptocurrencies, dollar, emerging markets, gods work, gold, gold price, sharia law finance, shotguneconomics, stocks, turkey No Comments

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As Goldman Sachs claims to be doing the work of the God of Israel for the West, China may be doing Allah's work in aiding Turkey

11:46 AM banking, china, debt, erdogan, god's work, goldman sachs, islam, lloyd blankfein, sharia law finance, talmudic judaism, turkey No Comments

There is an interesting dichotomy when it comes to usury in the religions of Judaism and Islam, and this of course has had quite fascinating results within the public and private debt markets of both the Judeo-Christian and Islamic nations.

Charging interest on money was a heresy for both the followers of the Torah and also for those who follow the Quran, but ever since the original Judaism was re-written by the Pharisees following their ouster from Jerusalem in 70 A.D., Jews are now allowed to charge interest on money to the Goyim (non-Jew).

The Torah and Talmud encourage lending money without interest. But the halakha (Jewish law) that prescribes interest-free loans applies only to loans made to other Jews. Jewish law allows making loans with interest to persons who are not Jewish.

On the flip side, the Quran does not stop a Muslim from borrowing money at interest, but rather that they cannot do so themselves, or receive a benefit from the lending of money to others.

Central to Islamic finance is the fact that money itself has no intrinsic value; it is simply a medium of exchange. Each unit is 100% equal in value to another unit of the same denomination and you are not allowed to make a profit by exchanging cash with another person. A Muslim is not allowed to benefit from lending money or receiving money from someone. 

This means that earning interest (riba) is not allowed – whether you are an individual or a bank. To comply with these rules, interest is not paid on Islamic savings or current accounts, or charged on Islamic mortgages. – The Guardian

So where the dichotomy between East and West, and Judeo-Christian vs. Islam emerges is in the fact that most of the banks and money-lenders throughout the U.S. and Europe are of a Talmudic Jewish background, and where a large majority of the financial systems in the Middle East are theocratically run through the religious doctrines of Sharia Financial Law.

Doing God's work... but which God?

The chief executive of Goldman Sachs, which has attracted widespread media attention over the size of its staff bonuses, says he believes banks serve a social purpose and are “doing God’s work.” – New York Times

The current banking system used throughout the Western world originated from the platforms created by the Talmudic Jewish family known as the Rothschilds and their use of credit and debt to run the monetary systems of nations and economies.  And within that platform is also the ability for the bankers to control political and military systems which often result in the use of force or coercion to enact policies on nations such as through austerity.

The World Bank and the International Monetary Fund (IMF) are the two most powerful institutions in global trade and finance.1 Since 1980, the United States government which dominates both bodies has used them to economically subjugate the developing world. The World Bank and the IMF have forced Third World countries to open their economies to Western penetration and increase exports of primary goods to wealthy nations. These steps amongst others have multiplied profits for Western multinational corporations while subjecting Third World countries to horrendous levels of poverty, unemployment, malnutrition, illiteracy and economic decline. The region worst affected has been Africa. For two decades the World Bank and the IMF have forced developing countries to create conditions that benefit Western corporations and governments. These conditions are known as Structural Adjustment Programs (SAPs). SAPs require governments to: cut public spending,(including eliminating subsidies for food, medical care and education); raise interest rates, thus reducing access to credit; privatize state enterprises; increase exports; and reduce barriers to trade and foreign investment such as tariffs and import duties. – Halifax Initiative

Thus for decades doing 'God's work' for those claiming to follow the God of Israel meant indebting, pillaging, and ultimately impoverishing countries to the benefit of a select few.

On the flip side we come now to Turkey, and a recent comment made by President Erdogan regarding their need to overcome current financial struggles through the strength of power of their god, Allah.

Mr Erdogan framed Turkey's crisis as a “national battle” against economic enemies, including the US. “If they have their dollar, we have the people, we have Allah,” he said, appealing to his religious Muslim base. His supporters in the crowd ripped up one dollar notes in protest. – UK Telegraph

And ironically that 'god' may be coming in the form of China.

China is under increasing pressure to provide more financial support for Turkey following calls for aid from President Erdogan as he defends his country’s economy from the fall out of its dispute with the US. 

China has been seeking closer ties with Turkey including advancing loans for development. – The Australian

In the end, the Gods of both religions have nothing to do with how banks are run, or how debt financing is acquired.  Yet sadly from time immemorial, men has sought to justify their actions by claiming they are doing so by the 'will of God', despite the fact that more often than not, the outcomes of their actions are against the very laws laid out by these same deities.

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As Bitcoin regains more than 50% of the cryptocurrency market, are we potentially seeing an extinction event for most of the rest

8:58 AM bitcoin, cryptocurrencies, extinction event, intrinsic value, market cap No Comments

While cryptocurrencies in some form may one day become the new paradigm of future finance, history will show that this current crop of digital assets will go down as a meteor that blazened the sky for a short time, only to dissipate when it ran out of momentum.

In 2017 the cryptocurrency sector saw one of, if not the greatest single asset moves in the history of the market, creating millionaires and even billionaires from just the investment of a few thousand dollars.  But just as fast as the market cap for crypto's rose from below $30 billion to nearly a trillion in the course of just 12 months, that same sector has now lost over 80% in the past eight months, with many of these crypto's now standing on the precipice of complete extinction.

Chart courtesy of onchainfx.com

A reckoning coming to the cryptocurrency markets, an “extinction-level event” that’s poised to wipe out 90 percent of the more than 1,800 coins and tokens that aren’t named bitcoin. 

That’s the prognostication of Xapo President Ted Rogers, anyway, who said that the impending altcoin bloodbath will provide discerning investors with an incredible opportunity to load up on bitcoin at a discount. 

“We could be in the midst of the extinction-level event for “cryptoassets” that many maximalists have predicted. 90%+ of @CoinMarketCap list will disappear eventually – might as well happen now,” Rogers wrote on Twitter. “Meantime, lower BTC price means incredible opportunity to buy more #bitcoin.” - CCN

The drop in value of nearly 90% of cryptocurrencies has even allowed Bitcoin to move back over the 50% threshold of market cap despite the fact that it too remains more than 60% below its all time high.

Because of the popularity of cryptocurrencies in 2017, nearly everyone and everything sought to tokenize itself under the banner of the cryptocurrency mania.  But in the end as with all things, if there is nothing underlying the foundation of any particular asset, its intrinsic value will always revert back to zero.

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There is an interesting dichotomy in gold's summer long doldrums as investors selling paper gold, but few are selling their physical gold

8:20 AM banks, dollar, gold, gold contracts, gold price, liquidity crisis, paper gold, sentiment, supply and demand No Comments

For a long time now, and especially since the gold price massacre back in 2011 by the bullion banks, the pricing of the metal has been ruled by the paper markets where exchanges have allowed these banks to short naked contracts at will to manipulate the spot price.  However here in 2018, even as that price has been beaten down throughout the summer thanks in large part to a rising dollar and global liquidity issues, there has actually been very little selling by investors of their physical gold.

"What were seeing this time, and again the paper markets can control the price to a degree, is that physical selling of actual physical gold... we haven't had that capitulation, ie... we haven't had in our company anyone selling us their physical gold and I think that is probably the case worldwide."

"The ounce price has held up pretty well with the quantity of short positions (paper shorts) that are in the market, and the shorts do have to eventually cover, which means that we can account to a degree the upside because we are seeing very little by way of liquidations in the physical gold market." - McAlvaney Weekly Commentary

Besides sentiment for gold being at one of its lowest levels in decades, most investors already simply buy metal positions using the paper markets.  And while they 'think' they own gold by buying futures or shares in an ETF,  in reality they just own a contract claim on gold which few ever make a demand on.  And because of this, paper gold assets like ETF's are one of the first to be liquidated when investors need cash to cover margin calls or other imbalances in their portfolios.

With the ongoing currency crisis in the emerging markets creating growing liquidity problems that have led to a rush into the dollar that is similar to 2008 and 2009, paper gold has become the big loser here in the short term as investors sell off their positions to help cover their more important and dire concerns.  But for those who hold physical, they are not falling prey to the emotion of falling prices and over time will see a massive return in their stacks when sentiment finally changes, and the laws of supply and demand weigh highly in their favor.

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