World Economic Recovery


In 2015? Not likely. “GE lost 13.6 billion dollars in the first quarter … That is a lot of money. How in the world does a company lose 13.6 billion dollars in a single quarter during an ‘economic recovery’?”

The Global Liquidity Squeeze Has Begun

Michael Snyder, on April 17th, 2015

Get ready for another major worldwide credit crunch.  Today, the entire global financial system resembles a colossal spiral of debt.  Just about all economic activity involves the flow of credit in some way …  When the system started to fail back in 2008, global authorities responded by pumping this debt spiral back up … global debt has risen by $35 trillion since the last crisis.  …

Just a few days ago the IMF warned regulators to prepare for a global “liquidity shock“.  And on Friday, Chinese authorities announced a ban on certain types of financing for margin trades on over-the-counter stocks, and we learned that preparations are being made behind the scenes in Europe for a Greek debt default and a Greek exit from the eurozone.  On top of everything else, we just witnessed the biggest spike in credit application rejections ever recorded in the United States.  All of these are signs that credit conditions are tightening, and once a “liquidity squeeze” begins, it can create a lot of fear. …

Overall, China has seen more debt growth than any other major industrialized nation since the last recession. … (Chinese) investors have been using something called “umbrella trusts” to … have much more leverage than normal brokerage financing would allow.  This works great as long as stocks go up.  Once they start going down, the losses can be absolutely staggering. That is why Chinese authorities are stepping in …

(Meanwhile) in Europe, the Greek debt crisis is finally coming to a breaking point.  (Now) the head of the IMF says that no delay will be allowed on the repayment of IMF loans that are due next month … Also … countries are forcing subsidiaries of Greek banks that operate inside their borders to reduce their risk to a Greek debt default to zero … Once Greece leaves the euro, that is going to create a tremendous credit crunch in Europe as fear begins to spread like wildfire.  Everyone will … want to pull their money out …

(In the U.S. big firms besides just GE) are reporting disappointing earnings numbers … the delinquency rate on student loans has reached a very frightening level56 percent of all Americans have subprime credit today, and … we just witnessed the biggest spike in credit application rejections ever recorded. We have reached a point of debt saturation, and the credit crunch that is going to follow is going to be extremely painful. …

We are starting to see the early phases of a liquidity squeeze. …

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About icliks

Biding my time in central ms ... yours too, if ur reading this.
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