2015 Greatest Hits: Presenting The Most Popular Posts Of The Past Year

One year ago, when looking at the 20 most popular stories of 2014, we were troubled by a recurring thread: “despite the just concluded 6th consecutive year of a rising S&P 500 – the longest such stretch since 1999 of what otherwise would be deemed optimism – despite what should be a steadily improving economy and improving social and economic conditions, what readers founds most fascinating, and troubling, was the increasing preponderance of social disobedience, of covert, proxy or outright wars, and of civil unrest: all phenomena that accompany a world sliding deeper into distress, not as most central banks and their puppet media would have us believe, a global recovery.”
We will be the first to admit that while it is more difficult to find a coherent theme unifying the most popular posts on Zero Hedge as determined by you, our readers, in the past year, several major domestic socio-economic tensions all came to a head in 2015: class warfare in the US approached unprecedented levels with antagonism between races, genders, ethnicities, ideologies, age groups and incomes all approaching peak levels, and spilling over, literally, on the street as the US public was inundated with daily reports of mass shootings, of trigger-happy policemen, of petulant students demanding conformity, of a president demanding the population hand over even more constitutional rights, of a nation torn in the most volatile presidential race yet.
All this took place as the median income across the US continued to decline: the rich got richer, the poor got poorer, and themiddle class was officially put on the endangered species list, although in 2015, for the first time since the financial crisis, the market closed red in no small part due to the action of the Fed, which after seven years of ZIRP, hiked rates for the first time in nine years despite all other central banks “giving it all they’ve got.”
For those trading, it was a year of rising, and in many cases, brutal intraday volatility, of ever more flash crashes across virtually all asset classes, of pain for anyone who was not invested in the five largest companies, and overall a year of change and losses for those hoping the Fed would “have their back” no matter what.

This post was published at Zero Hedge on 12/31/2015.

2015 Was The Worst Year For The Stock Market Since 2008

It’s official – 2015 was a horrible year for stocks. On the last day of the year, the Dow Jones Industrial Average was down another 178 points, and overall it was the worst year for the Dow since 2008. But of course the Dow was far from alone. The S&P 500, the Russell 2000 and Dow Transports also all had their worst years since 2008. Isn’t it funny how these things seem to happen every seven years? But compared to other investments, stocks had a relatively ‘good’ year. In 2015, junk bonds, oil and industrial commodities all crashed hard – just like they all did just prior to the great stock market crash of 2008. According to CNN, almost 70 percent of all investors lost money in 2015, and things are unfolding in textbook fashion for much more financial chaos in 2016.
Globally, over the past 12 months we have seen financial shaking unlike anything that we have experienced since the last great financial crisis. During the month of August markets all over the world started to go haywire, and at one point approximately 11 trillion dollars of financial wealth had been wiped out globally according to author Jonathan Cahn.
Since that time, U. S. stocks rebounded quite a bit, but they still ended red for the year. Other global markets were not nearly as fortunate. Some major indexes finished 2015 down 20 percent or more, and European stocks just had their second worst December ever.
I honestly don’t understand the ‘nothing is happening’ crowd. The numbers clearly tell us that a global financial crisis began in 2015, and it threatens to accelerate greatly as we head into 2016.
Actually, there are a whole lot of people out there that would be truly thankful if ‘nothing’ had happened over the past 12 months. For example, there are five very unfortunate corporate CEOs that collectively lost 20 billion dollars in 2015…

This post was published at The Economic Collapse Blog on December 31st, 2015.

This Is What Stocks Do During Hyperinflation

One of the classical refrains for buying stocks is that they preserve purchasing power and add value, even under such extreme monetary conditions as hyperinflation, or in other words, on a relative basis, local equities when denominated in a stable currency, will increase in value even as the local currency disintegrates.
As one example of this phenomenon, historians and equity bulls provide the widely referenced example showing that during the Weimar period, even as the mark lost all of its value, the stock market in USD terms actually rose during the parabolic phase.

This post was published at Zero Hedge on 12/31/2015.

The Damage Has Been Done And The Consequences Will Be Suffered: ‘Have a Healthy Storage of Food, Precious Metals and Necessary Supplies’

While the band plays on and Americans celebrate New Year’s many have no idea what may be in store in 2016. Mainstream financial pundits like to paint a rosy picture of the current economic conditions, suggesting that the government’s green shoots of yesteryear have now turned to full blown money trees, wherein consumers are spending, businesses are selling and everyone has an unlimited flow of cash.
But as noted by analysts at CrushTheStreet.com in their latest video report, ‘what we have become accustomed to in terms of normal is rapidly coming to an end.’
Indeed, with the Federal Reserve recently having raised interest rates, corporate bond markets starting to crack, and abysmal sales numbers over the holiday season, 2016 could very well spell disaster for financial markets, including government bonds.
So serious is the potential destruction to come that, according to the report, you’d better be ready with an alternate monetary mechanism of exchange such as gold or silver, as well as food and other stockpiles to mitigate supply disruptions and shortages.
Watch Perfect Storm Market Collapse courtesy of Crush The Street:

This post was published at shtfplan on December 31st, 2015.

The Good, The Bad & The Ugly From 2015

A brief sampling of the best, worst and toughest financial markets of 2015.
Like any year, 2015 had its share of good markets (mainly stocks in or related to F. A. N. G.), bad markets (essentially all commodities, currencies, most bonds and the majority of stocks) and the ugly (most actively managed funds). Among the market segments and indices that we track, today’s Chart Of The Day presents the winners of each of the three categories this year (through 12/30/2015).

This post was published at Zero Hedge on 12/31/2015.

America In 2015 (The Chart)

2015 – the year when The Fed hiked rates for the first time in a decade to confirm its own narrative that “everything is awesome” and the US economy can handle ‘normalization’.
2015 – the worst collapse in US macro-economic data since 2008 on both an absolute and relative to expectations basis.

This post was published at Zero Hedge on 12/31/2015.

Expect a Huge Jump in Layoffs in 2016; Eye on Initial Unemployment Claims: Have they Bottomed?

I have a watchful eye on initial unemployment claims. They have been trending higher (unexpectedly of course) since mid-October.
Initial Claims 2015

Econoday economists were surprised by the jump.
Initial jobless claims unexpectedly jumped 20,000 to 287,000 in the December 26 holiday week, the highest level since the July 4 holiday week. The Econoday consensus expected an increase of 3,000 to 270,000. The 4-week moving average was up 4,500 to 277,000 in the December 26 week, the highest since the July 18 week. The level of continuing claims increased 3,000 to 2.198 million in the December 19 week. The seasonally adjusted insured unemployment was unchanged at 1.6 percent in the December 19 week. It should be noted that readings in this report can be volatile during the holiday weeks.

This post was published at Global Economic Analysis on December 31, 2.

Billionaires Battle: Buffett Beats Musk In Nevada

In a clash of the titans, Warren Buffett just defeated Elon Musk.
The fight was over solar net-metering in Nevada, a state that has the fifth largest installed solar capacity in the country. Nevada is home to Tesla’s ‘Gigafactory,’ which will produce batteries for electric vehicles. In addition to CEO of Tesla, Elon Musk is also the chairman of SolarCity, and net-metering – the policy that allows homeowners with solar panels to be paid for the power they produce – is central to solar economics.
But while Musk has quite a bit of sway in the Silver State, he came up short against Warren Buffett. NV Energy, a major Nevada utility and subsidiary of Buffett’s Berkshire Hathaway, strongly opposed the net-metering provision.
Earlier this year the Nevada state legislature ordered the Public Utility Commission (PUC) to formulate a new net-metering payment by the end of 2015 after the state maxed out the allotted 235 megawatt net-metering program. Vivint Solar, another solar developer, pulled out of Nevada last summer after the net-metering program became fully subscribed, which forced solar installations to grind to a halt. The impasse meant that a lot was riding on the PUC’s decision.

This post was published at Zero Hedge on 12/31/2015.

Business in the Midwest Takes Worst Hit since July 2009

Ugly, ugly, ugly. Manufacturing and non-manufacturing. Thank God that manufacturing is just 12% of US GDP, and that it contributes only $2.1 trillion to the economy, and that only 9% of the US workforce is directly employed by it, according to the National Association of Manufacturers. So a swoon in manufacturing isn’t by itself going to crush the US economy. That’s the meme surrounding the ugly reality that has been spreading through US manufacturing.
And the Chicago Business Barometer just added another very ugly detail to the overall image, but this indicator goes far beyond manufacturing.
Caveat: Chicago is already in trouble
OK, this is just one component of the complex and vast national economic scenery, though an important one. It’s regional, and Chicago has its own set of issues, including terrible fiscal problems. Moody’s downgraded the city to junk in May 2015, based on the costs of dealing with its unfunded liabilities, and the strain they will pose on the ‘city’s financial operations.’ Moody’s lamented that ‘Chicago’s tax base is highly leveraged by the debt and unfunded pension obligations of the city, as well as those of overlapping governments.’

This post was published at Wolf Street by Wolf Richter ‘ December 31, 2015.

Chicago PMI Crashes, New Orders and Backlogs Plunge to May 2009 Level; Service Economy Headed for a Slowdown?

The Unexpected Strikes Chicago Again
It was another disastrous month for the Chicago PMI. Economists expected a bounce back from last month’s unexpected dip into negative territory. Instead the numbers reflect what’s best described as a two-month crash.
The Econoday Consensus Estimate was a guess of 50 in a range of 48 to 53. The actual reading of 42.9 was far below any economist’s estimate.
The December Chicago PMI tumbled to a reading of just 42.9, down 5.8 points. The reading was a fresh 6-1/2 year low and the seventh contraction this year. It also was far below expectations of a breakeven reading of 50.
The biggest contributor to the decline was a 17.2 point plunge in order backlogs, to 29.4, marking their eleventh consecutive month in contraction. December’s reading was the lowest since May 2009. The index also was depressed by ongoing weakness in new orders, which contracted at a faster pace, down 5.3 points to 38.8, the lowest level since May 2009. Both production and employment fell into contraction.

This post was published at Global Economic Analysis on December 31, 2015.

Oil Crash Shrinks Russian GDP, Energy Minister Blames Saudis

‘The risk of a deeper decline has intensified.’
Russia’s oil-dependent economy appears headed for a second year of recession, and Energy Minister Alexander Novak says the blame falls squarely on the Saudis.
The Russian gross domestic product fell by 4 percent in November from its level in the same month in 2014, and had shrunk 3.7 percent in October from its levels a year earlier, the Economy Ministry reported Monday.
The reason, to no one’s surprise, is the plunge in oil prices over the past 18 months. The global average value of a barrel of oil has crashed from over $110 per barrel in the summer of 2014 to just below $40 per barrel today.
Because Russia’s government relies on oil production for half its revenues, it’s preparing for a 3 percent deficit in the budget for the coming 2016 fiscal year. Making matters worse, profits in any industry related to oil are down so far that it appears its current recession may last as long as two years.
‘The risk of a deeper decline has intensified,’ Andrei Klepach, chief economist at Russian state development lender Vnesheconombank and a former deputy economy minister, wrote in a report. He added that both bad economic and political news for Russia will contribute to ‘a stable negative trend, forcing downgrades in forecasts for next year.’

This post was published at Wolf Street by Andy Tully ‘ December 31, 2015.

At Times, it Pays to Raise Your Head and Look Around

We believe this is one of those times.
‘Another bad day for oil,’ says Investor’s Business Daily. U. S. crude oil fell below $37 a barrel. The Dow fell 116 points. Neither of these events is significant. We report them merely to warm up. It is the last day of 2015; we look for a good way to ‘wrap up’ the fast-departing year.
Myth or Reality?
‘What if we’re wrong?’ we’ve been asking. As we proved yesterday, we err as much as anyone. But we spend more time than most trying to understand the ‘big picture.’ And we hope to be slightly more right than wrong at least about that.
But even this could be a trap. What if there is no ‘big picture’? What if it is just something we imagine… a vision created in our own brain… a myth, not a reality?
Some of the world’s most successful investors maintain that trying to see the big picture is a waste of time. Peter Lynch, for instance. Lynch ran Fidelity’s Magellan Fund for 13 years and made returns of 2,639% over that time. He liked to say that if you spent 13 minutes a year on economics, you wasted 10 minutes.
‘We can never know what is going on’ goes the argument. So, we’re better off investing our energy into researching individual stocks.

This post was published at Wolf Street by Bill Bonner ‘ December 31, 2015.

Price of Gold to Rise Significantly in Next Five Years

This following interview with Peter Schiff was originally published at Gold Eagle. Find it here.
Gold-Eagle: Fed Chair Janet Yellen recently hiked interest rates by 0.25%. What impact do you believe this will have upon US stocks and the national economy?
Peter Schiff: The air was already coming out of the bubble prior to this tiny rate hike. But now that the hole has been made larger by the hike, the air will rush out that much faster. The key is how much longer the Fed will wait before admitting that the economy is much weaker than they believed and reverse course.
Gold-Eagle: The last time the Fed increased the Federal Funds Rate was nine years ago in June 2006. In your view, do you believe the Fed will continue raising rates in 2016 with the objective of increasing inflation to stimulate economic growth?

Peter: No, I believe the Fed will reverse course sometime in 2016 and lower rates back to zero, and may in fact reduce them below zero. I also expect the Fed to launch another round of quantitative easing. Not because it works, but because it’s the only policy tool they believe they have.
Gold-Eagle: The US Dollar Index has been rising vis- -vis other currencies for nearly two years… and it surged up recently closing 99.32 on the news of the Fed hiking rates. In the event the US greenback continues to strengthen through 2016, what effect might it have on the US stock market?

This post was published at Schiffgold on DECEMBER 31, 2015.

Bix Weir: 17 requirements for a freely traded silver market structure

Dear Friend of GATA and Gold:
Financial market blogger Bix Weir of the Road to Roota Letter today offers “17 Requirements for a Freely Traded Silver Market Structure,” a list containing many good suggestions but perhaps omitting the one requirement that would transform not just the silver market but all markets on the planet.
That is, the U. S. Treasury Department, its Exchange Stabilization Fund, and the Federal Reserve should be required to publicize simultaneously every financial transaction they make, directly or through intermediaries, including all trades executed through the trading room of the Federal Reserve Bank of New York. Fear of disclosure of its market interventions is what long has induced the Fed to oppose legislation for a comprehensive audit of its activities.
Weir’s suggestions are posted at the Road to Roota Internet site here:

This post was published at RoadtoRoota on December 31, 2015.

Darkness Falls Upon Norway’s Key Figures Going Into 2016

Darkness is Upon Us: Norway’s Key Figures Going Into 2016

As we move into winter, darkness has fallen up on us. Oil, ca. 65% of the nation’s economy, will not see the required $70 barrelanytime soon. American innovation, once again, turns a scarce resource into an abundant commodity. Despite optimistic Norwegian media articles, the potential for $20 per barrel looms. Production overwhelms demand while inventories rise to record highs. Although, still considered the best place to live, the cracks, in the oil based economy, are forming.
This story, told in numbers, derived from Norges Bank (The Norwegian Central Bank) and SSB (The Norwegian Statistics Bureau), shows that 2015 is much different from previous years. Things are breaking out to the negative direction all over.
Key Budgetary and Economic Metrics
I wrote an article just over two months ago, ‘Norway: The Silent Crisis.’ This story is a follow up, confirming the trends. Many of us immigrated here to live well. Only a few places in the US and Switzerland can compete with Norwegian life.

This post was published at Zero Hedge on 12/31/2015.