Stephen Jenkinson: Living With Meaning

The powerful lessons that grief can teach us about life
On this site we discuss the large predicaments the world faces. A question that often arises, especially at our annual seminars is: Given these challenges, how should I be? What outlook and behaviors will better help me meet what’s coming?
This week’s podcast gets quite existential. Chris sits down with Stephen Jenkinson, an author and thinker who a number of Peak Prosperity readers have requested come on the show. Jenkinson’s specialization is grief and dying — through his decades of work in these fields, he has developed a series of observations on what it means to live, and thereby die, with meaning.
A heads up: the path of this conversation is somewhat metaphysical and may not be everyone’s cup of tea. But the topics addressed are important; ones our society needs to start having some honest discussion about. Things like how to face our mistakes, errors and shortcomings openly — as with addiction, only with acknowledgement and acceptance of our condition can we then move on to self-betterment.
Jenkinson observes how, culturally, we are so averse to unpleasantness that we suppress the very conditions that are necessary for positive transformation:

This post was published at PeakProsperity on December 11, 2016,.

End of the World History Chart…

I try to show this long term monthly chart for the $COMPQ which I call the ‘End of the World History Chart’ at least once a year or if something interesting takes place. When you look at the 1987 crash it felt like the end of the world at the time but that ended up being the second reversal point in the green bullish rising channel. How many remember the months leading up to the first Gulf war in 1991? No one knew at the time how that conflict would play out as the US was going up against the 5th largest army in the world. On the first night of bombing it was very clear that the conflict would be over quickly and the stock markets took off the very next day which made the fourth reversal point in the green bullish rising channel.
Which also helped put that fourth reversal point in the green bullish rising channel was the Savings and Loan crises which was dominating the headlines at that time. As you can see the COMPQ launched into one of the greatest bull markets of all time that ended nine years later when the tech bubble finally burned out.
How many remember the crash in 1998 that doesn’t look like anything on this chart but it was the LTCM, Long Term Capital Management debacle that felt like the end of the world at the time. It’s easy to look at a chart like this and see how important events in the world look in hindsight but when you are living and trading during one of these events it’s a totally different story.

This post was published at GoldSeek on 11 December 2016.

Monte Paschi “Scrambles” With Last Minute Capital Increase To Avoid Nationalization

Having picked a new prime minister to replace Matteo Renzi, when as reported this morning Italian president Sergio Mattarella asked Foreign Minister Paolo Gentiloni, a loyalist from Renzi’s Democratic Party, to form a new government, the chaos surrounding Italy’s political future appears to be subsiding, which as we said this morning, is welcome news for the future of Monte Paschi, as Italy’s third largest bank may once again avoid a state bailout should enough private investors turn up and inject funds into the failing financial institution, the world’s oldest.
So it comes as no surprise that, facing a third nationalization in just a few years, Bloomberg reports that Banca Monte dei Paschi di Siena plans to step up efforts to win investors for a debt-for-equity swap in the coming days, and will once again press ahead with a 5 billion capital raise to avoid a state rescue that would impose losses on bondholders and shareholders, an outcome the ECB suggested on Friday would be unavoidable absent a private sector rescue.
Bloomberg adds that the bank’s board is meeting Sunday to review a fresh offer for note holders that would allow more retail investors to participate after money managers already swapped 1.02b, although it remains unclear why more investors would take on the bank’s offer.
Following the swap, a stock sale to an anchor investor and a public share placement would follow, to complete the full capital raise.

This post was published at Zero Hedge on Dec 11, 2016.

Trump Reignites China Diplomatic Spat, Says Not Bound By “One China” Policy

While the domestic US audience was focused on what Trump would say about the latest scandal of alleged Russian intervention in the US presidential elections, which as a reminder, he called “ridiculous” and suggested that democrats are behind the report, China was more curious by Trump’s foreign policy thoughts, which may have sparked yet another diplomatic spat, because one week after Trump snubbed America’s long-running “One China” policy, today the President-elect questioned whether the United States had to be bound by its long-standing position that Taiwan is part of “one China” and brushed aside Beijing’s concerns about his decision to accept a phone call from Taiwan’s president.
“I fully understand the ‘one China’ policy, but I don’t know why we have to be bound by a ‘one China’ policy unless we make a deal with China having to do with other things, including trade,” Trump said. Trump’s decision to accept a congratulatory telephone call from Taiwan President Tsai Ing-wen on Dec. 2 prompted a diplomatic protest from Beijing, which considers Taiwan a renegade province.

This post was published at Zero Hedge on Dec 11, 2016.

11/12/16: Legal Frameworks Relating to State-led Cyber Attacks

This is a blog about economics and finance, not politics. Alas, geopolitical risks do impact economic risks and they materially influence financial markets. I am trying to stay out of the political analysis and hence offer little in terms of my own thinking on the matter. But that does not mean I should not share with you other analysts’ views that I find informative, interesting or thought-provoking. I do so on Twitter, without endorsing (via retweets or ‘likes’ or shares) any given position, so I shall be able to do the same here, on the blog.

This post was published at True Economics on Sunday, December 11, 2016.

2007 All Over Again, Part 6: Stock Valuations Enter ‘Crash’ Territory

The Trump Christmas stock market rally has taken valuations beyond a point that in the past has signaled trouble, which in turn has generated a lot of cautionary press like the following:
Market indicator hits extreme levels last seen before plunges in 1929, 2000 and 2008 (CNBC) – While the S&P 500 is reaching all-time highs on optimism over Donald Trump’s economic agenda, some Wall Street strategists are increasingly worried about a widely followed valuation measure that’s reached levels that preceded most of the major market crashes of the last 100 years.’The cyclically adjusted P/E (CAPE), a valuation measure created by economist Robert Shiller now stands over 27 and has been exceeded only in the 1929 mania, the 2000 tech mania and the 2007 housing and stock bubble,’ Alan Newman wrote in his Stock Market Crosscurrents letter at the end of November.
Newman said even if the market’s earnings increase by 10 percent under Trump’s policies ‘we’re still dealing with the same picture, overvaluation on a very grand scale.’

This post was published at DollarCollapse on DECEMBER 11, 2016.

Why the Peso Crisis Won’t be ‘Contained’ to Mexico

In a world immensely exposed to Mexico’s debt and peso. Mexico’s economy has excelled at two key things over the past two decades: opening itself to global capital and attracting foreign direct investment, in particular from American businesses. But those two things could soon become its Achilles heel, especially with Donald Trump seemingly determined to renegotiate, if not scrap altogether, the document most responsible for transforming Mexico into an industrial powerhouse and one of the world’s most open economies, the North American Free Trade Agreement (NAFTA).
Thanks to NAFTA, Mexico has never been so dependent on its northern neighbor. The U. S. accounts for 80% of its exports, 49% of its imports and 60% of all its foreign direct investment. In fact, so intertwined is Mexico’s economy with its northern neighbor that it just became the second biggest exporter to the U. S., overtaking Canada for the first time ever, reports Bloomberg:
Shipments from Mexico totaled $245 billion in the first 10 months of the year, according to Commerce Department figures released Tuesday, ahead of Canada’s $230 billion. If the trend continues, it would be the first time ever the U. S. bought more imports from its neighbor to the south. The two countries ended 2015 tied in exports to the U. S.
The trend of catching up to Canada puts China and Mexico as the top two exporters to the U. S. just as Trump prepares to take office in January, reflecting the strong pull of lower cost jurisdictions for the U. S. economy.

This post was published at Wolf Street on Dec 11, 2016.

Guest Post: Here’s Why The Banksters Are In Trouble

If the Fed were to reverse the portion of its QE in which it injected trillions onto big bank balance sheets as well as fomented a mortgage/housing bubble, the Too Big To Fails – including Goldman Sachs – would collapse. Make no mistake, it would ultimately prove to be a good thing.
However, there’s also a growing groundswell of grassroot Americans who have ‘woken up.’ Perhaps the only good attribute of the last election is that hastened the rate of enlightenment. Too be sure, the number of Americans who understand the difference between Truth and Propaganda has vastly increased.
A reader of this blog and subscriber to the Mining Stock and Short Seller Journals submitted this narrative of a recent ‘enlightenment’ experience that occurred while on a routine visit to the local barber shop. It’s worth perusing:
I’m almost speechless as a result of the experience I just had. I have just returned from getting a haircut at the local barbershop downtown. I was there along with the barber, a semi-retired gentleman who now drives a school bus part-time, and a local hay farmer. Our conversation was an absolute stunner, and provides very compelling (albeit admittedly anecdotal) evidence that the bankster elite are in BIG trouble.

This post was published at Investment Research Dynamics on December 11, 2016.

BIS Warns OF Bouts Of Extreme Volatility, As Market Undergoes “Paradigm Shift”

The Bank of International Settlements is particularly good at two things in its periodic quarterly review update: i) stating the obvious, especially when it comes to summarizing the trader and market participants concerns at any given moment, and ii) having its constituent central bank members – after all the BIS is the “central banks’ central bank” – ignore all of its warnings.
In its just released, latest report, the BIS continues to excel in both, when it lays out what it dubs a “paradigm shift in markets” and points out that unlike previous VaR shock episodes, most notably the 2013 Taper Tantrum, financial markets have been remarkably resilient to rising bond yields and sudden shift in outlook following last month’s shock U. S. election result.
However, the BIS warns that the sheer scale of uncertainties ahead means the adjustment will be “bumpy”, the BIS said on Sunday. In its quarterly report, the BIS said that while the resilience to recent market swings following the U. S. election and Brexit vote have been welcome, investors should be braced for further bouts of extreme volatilty and “flash crash” episodes like the one that hit sterling in October.

This post was published at Zero Hedge on Dec 11, 2016.

Paolo Gentiloni Picked As Italy’s New Prime Minister

With the ECB snubbing Italy on Friday, and refusing to grant insolvent bank Monte Paschi more time to find a financial rescue, it was of paramount urgency for Italy to announce a replacement government that of outgoing prime minister Matteo Renzi, in order to mitigate concerns about the ongoing political chaos. As a result, on Sunday, Italy’s President Sergio Mattarella asked departing Foreign Minister Paolo Gentiloni – a loyalist from Renzi’s Democratic Party – to form a new government, in the process hopefully bringing to a close a political crisis triggered by a ‘no vote’ in a referendum on constitutional reform last weekend.
As the WSJ first reported, Mattarella gave Gentiloni the mandate to try to form a new caretaker cabinet. Gentiloni, 62, accepted and will begin consultations with political parties to put together his team of ministers. That list could emerge as soon as Sunday evening, setting the stage for the new government to seek votes of confidence in parliament by Tuesday. Correspondents say that if he is successful in rallying support a government could be formed in days.

This post was published at Zero Hedge on Dec 11, 2016.

Trump, Reagan economies at polar opposites

Market expectations could be based on false assumption
‘Looking ahead, Credit Suisse argues against the view of many pundits that U. S. President-elect Donald Trump’s fiscal policies are likely to hurt gold. The market has factored in an expectation that a mix of U. S. tax cuts, deregulation and infrastructure spending will boost the economy, pushing up real interest rates and strengthening the U. S. dollar. ‘We counter that trade protectionism and anti-immigration policies are negative for growth and positive for inflation,’ Credit Suisse said.” – SMN News/Kitco
Since election day, the markets have reacted as if the Trump administration were likely to be a re-run of the Reagan years. “Stocks and the dollar,” reported Bloomberg recently, “have risen since the Nov. 8 presidential election on hopes that Trump’s advocacy of big tax cuts, increased defense spending and deregulation will usher in another period of prosperity. The coming change will be a ‘profound president-led ideological shift’ akin to Reagan’s, according to Bridgewater Associates founder Ray Dalio. Trump’s advisers and the billionaire himself have embraced the comparison.”
Though there are profound similarities between the two philosophically in terms of tax, defense and deregulation policy, the economic conditions Trump will face are the polar opposite of what Ronald Reagan faced in 1981. Investors, as a result, could be basing investment decisions on a false assumption.
When Reagan took office the United States was just coming off a disastrous encounter with runaway inflation. If inflation was going to be tamed, the interest rate would have to be pushed to a level higher than the inflation rate, something then-Fed Chairman Paul Volcker in fact accomplished. It killed inflation, restored dollar strength and touched off a long-term stock market rally.

This post was published at GoldSeek on Sunday, 11 December 2016.

Doug Noland: Renzi Falls, Markets Rise

This is a syndicated repost courtesy of Credit Bubble Bulletin. To view original, click here. Reposted with permission.
Italian bank stocks (FTSE Italia bank index) declined a modest 2.3% Monday on the back of Sunday’s resounding defeat of Italian Prime Minister Renzi’s political reform referendum. The bank index then proceeded to surge 9.0% Tuesday, 4.5% Wednesday and another 3.6% Thursday, for a stunning 27% rally off November 28th trading lows. ‘Par for the course,’ as they say. Italian 10-year sovereign yields rose eight bps Monday, yet by Wednesday’s close yields were actually lower on the week. Italian sovereign CDS ended the week little changed. Italian stocks gained 7%.
Following Brexit, Trump’s win and Renzi’s defeat, hedging market risk has been relegated to the status ‘senseless lost cause’. A short squeeze and unwind of hedges fueled this week’s 12.7% Italian bank rally, along with a 9.5% surge in European banks that reverberated in Asia (Japan banks up 5.6%), the U. S. (banks up 5.4%) and globally. Especially in Europe, a reversal of bearish hedges created powerful buying power. It’s a common trading strategy to purchase put options with proceeds from selling out-of-money call options. Increasingly in the U. S. and in Europe, equities trade as if those on the wrong side of derivative (calls) trades are being forced to hedge exposure by aggressively purchasing stocks into a rapidly rising market. It’s a self-reinforcing market dislocation similar to that which not many months back fueled a historic collapse in global bond yields.

This post was published at Wall Street Examiner by Doug Noland ‘ December 10, 2016.