What in the World is Going on with Banks this Week? Emergency meetings, banker summits, crashing European banks…….
by Bruno de Landevoisin on 04/12/2016
- The Federal Reserve Board of Governors just held an “expedited special meeting” on Monday in closed-door session.
- The White House made an immediate announcement that the president was going to meet with Fed Chair Janet Yellen right after Monday’s special meeting and that Vice President Biden would be joining them.
- The Federal Reserve very shortly posted an announcement of another expedited closed-door meeting for Tuesday for the specific purpose of “bank supervision.”
- A G-20 meeting of finance ministers and central-bank heads starts in Washington, D.C., on Tuesday, too, and continues through Wednesday.
- Then on Thursday the World Bank and the International Monetary Fund meet in Washington.
- The Federal Reserve Bank of Atlanta just revised US GDP growth for the first quarter to the precipice of recession at 0.1%.
- US banks are expected this coming week to report their worst quarter financially since the start of the Great Recession.
- The press stated that the German government will sue the European Central Bank if it launches a more aggressive and populist form of quantitative easing, often called “helicopter money.”
- The European Union’s new “bail-in” procedures for failing banks were employed for the first time with Austrian bank Heta Asset Resolution AG.
- Italy’s minister of finance called an emergency meeting of Italian bankers to engage “last resort” measures for dealing with 360-billion euros of bad loans in banks that have only 50 billion in capital.
Phoenix Capital Research on 04/12/2016
… Japan is at the forefront for Keynesian driven Central Bank monetary policy. Japan was not only the first Central Bank to start ZIRP and QE, it has also launched the single largest QE program in history (a single QE program equal to over 25% of Japan’s GDP).
However, in the last few months, the Head of the Bank of Japan, Haruhiko Kuroda has lost credibility for the markets. …
Kuroda has gone from a magician to being “trapped.” … Now even former IMF economists are admitting Japan has entered the “End Game” …
The situation here is more significant than many realize. Japan first launched ZIRP in 1999. QE was launched there in 2000. So the Bank of Japan has roughly 15 years of experience with the monetary policies that all Central Banks have begun to adopt post 2008.
So if the Bank of Japan loses control of its financial system, it’s only a matter of time before other Central Banks do the same. At that point it’s systemic collapse.
Buckle up… it’s coming.
Tyler Durden on 04/13/2016
After stumbling sideways around unchanged MoM for 3 months, US retail sales tumbled 0.3% in March (considerably worse than the 0.1% MoM gain expected) confirming BofA’s credit card data as we warned. After 3 months of low-base bounce in YoY retail sales, March saw it collapse back to just 1.7% YoY – deep in recession territory. …
Auto Sales collapse 2.1% MoM … and perhaps just as problematic, Restaurants tumbled 0.8% – where all the hiring has been. …
Finally, as Goldman notes, weakness in auto sales and production could be an unwelcome headache for the manufacturing sector. Growth in auto output has accounted for 40% of the increase in manufacturing production since January 2012, not including spillovers to related sectors … .