• Tag Archives Germany
  • German Elections Void of Any Critical Discussion

    The German Bundestag election campaign has seen a total black-out of any discussion of the major crisis that is building in Europe. Nobody is mentioning that Euro crisis, ECB monetary policy, disintegration of the EU, refugee crisis, pension crisis, the municipalities on the brink of insolvency, or the drastic increases in taxation coming AFTER the election that will only lower disposable incomes and extend deflation.
    The politicians, and the press, are in full swing to hide the real trend at foot. The press is running stories why the Germans Love Merkel, yet she has never won even 40% of the popular vote. Even the press outside of Germany is in on the ‘selling’ of Merkel because she is the leader of Europe – good – bad – indifferent.
    Perhaps the monetary policy of the ECB has set the stage for a serious monetary crisis over the coming years that will seriously disrupt the German economy, in one way or another, depending upon the industry. Mario Draghi has experimented with negative rates which has kept the Eurozone governments on life-support – but they have not used the time to reform anything.

    This post was published at Armstrong Economics on Sep 23, 2017.

  • Stocks and Precious Metals Charts – On the Daedalian Wings of Paper Money and Corrupted Power

    “The conventional wisdom seems to be that the problems of the euro zone are, as economist Martin Feldstein once put it, ‘the inevitable consequence of imposing a single currency on a very heterogeneous group of countries.’
    What this commentary gets wrong, however, is that single currencies are never the product of debates about optimal economic solutions. Instead, currencies like the U. S. dollar itself are the result of political battles, where motivated actors try to centralize power.
    This has most often occurred ‘through iron and blood,’ as Otto van Bismarck, the unifier of Germany put it, as a result of catastrophic wars. Smaller geographic units were brought together to build the modern nation state, with a unified fiscal system, a common national language that was often imposed by force, a unified legal system, and, a single currency. Put differently, war makes the state, and the state makes the currency….
    European leaders weren’t stupid or self indulgent when they decided to move ahead with the euro, without fiscal union or strong Europe-level democracy. They just cared more about politics and international security than economics. They wanted to build a Europe that had transcended the divisions of the Cold War, and bind together Germany, which was reunited and much more powerful, with the rest of Europe.”
    Kathleen McNamara, This is what economists don’t understand about the euro crisis – or the U. S. dollar
    “Another cause of today’s instability is that we now have a society in America, Europe and much of the world which is totally dominated by the two elements of sovereignty that are not included in the state structure: control of credit and banking, and the corporation.

    This post was published at Jesses Crossroads Cafe on 18 SEPTEMBER 2017.

  • Which Countries Have The Most Economic Complexity?

    As Visual Capitalist’s Jeff Desjardins notes, rvery country has an economy that is unique.
    In some places, such as the United States or Germany, economies are able to produce many different goods and services that get exported around the world. These countries tend to house world-class businesses in sectors like financials, technology, consumer goods, and healthcare, with companies that produce highly specialized goods like automobiles, software, or pharmaceutical products. Ultimately, these are innovative economies that can roll with the punches, creating growth even when prospects are dim.
    In other places, this level of sophistication is just not there. Innovation and knowledge are stunted or non-existent for most industries, and these countries may focus exclusively on one or two goods to pay the bills. Venezuela’s reliance on oil is an obvious example of this, but there are even many Western countries that miss the mark here as well.
    MEASURING ECONOMIC COMPLEXITY In 2009, a team at Harvard formalized a measure of economic complexity that compared nations based on the sophistication of their economies. Now known as the Economic Complexity Index (ECI), the exact measurement is complicated, but it essentially uses data on two main things to uncover the underlying level of economic complexity:
    1. Economic Diversity
    Measures how many different products a country can produce.
    2. Economic Ubiquity
    Measures how many countries are able to make those products.
    In other words: if a country produces only a few goods, that economy is not very complex. Further, if a country produces many different products, but they are all simple ones that can be replicated elsewhere, the economy is still not complex. See full details on the project here.

    This post was published at Zero Hedge on Sep 18, 2017.

  • Germany & France Want to Tax Gross Sales on the Internet

    The hunt for taxes in France and Germany is in full swing. Merkel and Macrone are looking for endless new sources of tax revenues. They are moving directly into the position of destroying their economies because their thirst for more and more taxes never ends. No matter how much they collect, they never have enough. The latest scheme is now to tax gross turnover of internet companies such as Google and Amazon – not profits. The French want a 5% tax on everything in Europe. They already get a 20% VAT which is a complex consumption tax to keep countless government employees in a job with every layer of business taxesd having to file claims constantly.

    This post was published at Armstrong Economics on Sep 15, 2017.

  • “It Blows My Mind”: 100-Year Austrian Bond With Record Duration 3x Oversubscribed

    As we reported yesterday, Austria was set to make Eurozone history with the first sale of a 100 year bond direct to public markets, bypassing private syndication. It did that later in the day, when the 3.5 billion offering priced tighter than initially marketed, at RAGB 2/2047 +50, at a price 99.502 to yield a paltry 2.112% and with a negligible 2.1% cash coupon.
    What is even more notable is that despite mounting fears of an imminent tapering by the ECB which many have predicted will lead to a new European bond tantrum and blow out in yields, there was tremendous end demand by investors for the offering managed by BofAML, Erste Group, GS (B&D), NatWest and SocGen, mostly fund managers from across the globe, resulting in what ended up being more than 11BN in 208 different bids for the paper, an oversubscription of more than 3x! The breakdown for the final allocation is was follows, courtesy of Bloomberg:
    3.5b 100Y tranche: Book exceeded 10.8b from 208 investors, including 1.5b of JLM interest
    Allocation by geography:
    Eurozone incl. Austria 29% Germany 13% France 4% Spain 3% Other Eurozone 9% Other Europe (non-Eurozone) 55% U. K. 42% Switzerland 9% Americas 12% Middle East 4%

    This post was published at Zero Hedge on Sep 13, 2017.

  • ‘Things Have Been Going Up For Too Long’

    I have to believe that the Fed injected a large amount of liquidity into the financial system on Sunday evening. The 1.08% jump in the S&P 500, given the fundamental backdrop of economic, financial and geopolitical news should be driving the stock market relentlessly lower. The amount of Treasury debt outstanding spiked up $318 billion to $20.16 trillion. I’m sure the push up in stocks and the smashing of gold were both intentional as a means of leading the public to believe that there’s no problem with the Government’s debt going parabolic.
    Blankfein made the above title comment in reference to all of the global markets at a business conference at the Handlesblatt business conference in Frankfurt, Germany on Wednesday. He also said, ‘When yields on corporate bonds are lower than dividends on stocks – that unnerves me.’ In addition to Blankfein warning about stock and bond markets, Deutsche Bank’s CEO, John Cryan, warned that, ‘We are now seeing signs of bubbles in more and more parts of the capital market where we wouldn’t have expected them.’

    This post was published at Investment Research Dynamics on September 12, 2017.

  • Central Banks And Housing Prices: A Tale Of Three Countries (US, Germany and Japan)

    The US Federal Reserve, the European Central Bank (ECB) and Bank of Japan (BOJ) have all been hyper-active in recent decades. But the low-rate policies have not produced the same outcomes.
    The US, after home prices declined in 2008 and 2009, took a while to recover. Only in 2012 did US home prices begin to rise again.

    This post was published at Wall Street Examiner on September 11, 2017.

  • Terrorists In Germany’s Parliament?

    Even as Germany is increasingly cracking down on criticism of Islam, it appears prepared to give a genuine Islamic terrorist group the opportunity to win seats in its parliament…
    In a remarkable decision taken at the end of August, Germany’s Interior Ministry declined to bar the Popular Front for the Liberation of Palestine (PFLP) — listed as a terrorist organization by the US, Canada, the European Union, and Australia — “from campaigning as a political party in the September general election to the Bundestag.”
    Yes, the PFLP — on a joint list with the Marxist-Leninist Party — plans to field candidates in this month’s elections in Germany and run for Parliament.

    This post was published at Zero Hedge on Sep 11, 2017.

  • The world’s most powerful bank issues a major warning

    In 1869, a 48-year old Jewish immigrant from the tiny village of Trappstadt in Germany’s Bavaria region hung a shingle outside of his small office in lower Manhattan to officially launch his new business.
    His name was Marcus Goldman, and the business he started, what’s now known as Goldman Sachs, has become the preeminent investment bank in the world with nearly $1 trillion in assets.
    They didn’t get there by winning any popularity contests.
    Goldman Sachs has been at the heart of nearly every major banking scandal in recent history.
    The company has settled lawsuits on countless charges, ranging from exchange rate manipulation, stock price manipulation, demanding bribes from their own clients, front-running retail customers, and just about every shady business practice that would put money in their pockets.
    Yet throughout it all, Goldman Sachs has been protected from any serious punishment by its friends in highest offices of government.

    This post was published at Sovereign Man on Santiago, Chile.

  • What Share Of Bond Markets Do Central Banks Own: Deutsche Bank Answers

    With the latest ECB statement due out in just two days, traders are curious to see how Mario Draghi will escape from the trap in which the European central bank has found itself: on one hand, seeking to temper the recent dramatic rise in the Euro, on the other running out of QE eligible private-sector debt to monetize, especially in its largest captive market, Germany. While we don’t know how Draghi will succeed (or fail) in this endeavor, overnight Deutsche Bank has released a useful analysis breaking down what share of bond markets the biggest central banks currently own.
    In the analysis, DB puts the ECB CSPP holdings in the context of global QE by comparing what part of relevant markets is owned by major central banks. Then it provides a more granular update on the latest CSPP purchases, including the geographic breakdown of the current CSPP universe. Further, it focuses on the CSPP vs. PSPP dynamics, noting the conflicting signal between Q2 and the summer months. Finally, it addresses the question whether in selected jurisdictions CSPP purchases could be used to partly replace PSPP purchases if for one reason or the other the ECB cannot exit QE any time soon and scarcity becomes a hard, binding constraint in some government bond markets.
    The answers are shown in the table below, which compares central bank QE holdings across asset classes with Deutsche Bank’s estimates of the size of the corresponding markets. Using those estimates, the German lender calculates the fraction of each relevant universe in central bank ownership.

    This post was published at Zero Hedge on Sep 5, 2017.

  • WHY KOREAN TENSIONS SHOULD SOON EASE – effect on Dollar and Precious Metals…

    The tensions centered on the Korean peninsula should soon ease, leading to a rally in the dollar and a (mild) reaction in Precious Metals and other commodities like copper, for reasons that we will consider in this essay.
    There can be no denying that what we have previously referred to as ‘The Empire’ is intent on world domination. The evidence is there for all to see in the form of a vast network of military bases spread across the globe, and a history of invasion of various countries by the Empire in recent years in pursuit of its geopolitical objectives. The economic engine that drives the Empire and supports its imperialistic ambitions is the dollar, whose Reserve Currency status means that infinite quantities of it (or proxy derivatives like Treasuries) can be printed up and swapped for goods and services with any and all countries around the world, and it is this dynamic that supports the formidable US military machine.
    The last Empire that tried to take over the world was Nazi Germany, which recruited Japan to take over the Far East, so that together they became a global axis. As we know this led to an enormous titanic struggle for over 5 years to contain it and defeat it, resulting in immense destruction and loss of life. The reason that Hitler failed was good old fashioned imperial overreach – he didn’t know when to ‘call it a day’ and consolidate his gains, instead he tried to do what has been the undoing of most Empires in the past, take over the entire planet. Actually he got very close to creating a sustainable 3rd Reich, but made several key mistakes. The first was not overrunning Britain while he had the chance, instead he made the fatal mistake of leaving it and starting a war on a second front with Russia, which meant that, in addition to his logistical support being spread too thin, the US was later able to use Britain as an aircraft carrier to bomb Germany back into the Stone Age, which needless to say resulted in its defeat. The second mistake was permitting eastern henchman Japan to bomb Pearl Harbor, and thus bring the US into the war against both Nazi Germany and Japan. Perhaps due to parochial ignorance, Germany and Japan made the catastrophic miscalculation that they could somehow overcome the United States, which at the time was an emerging economic powerhouse. The bombing of Pearl Harbor awoke the sleeping giant and meant the beginning of the end for the Germany – Japan Empire.

    This post was published at Clive Maund on Tuesday, September 05, 2017.

  • Vault Containing $70 Billion In German Gold To Be Evacuated As Frankfurt Defuses Massive Bomb

    Approximately 60,000 residents of Germany’s financial capital, Frankfurt, will be ordered to evacuate their homes on Sunday as the city’s emergency service staff will attempt to defuse a massive World War Two bomb, discovered recently at a local building site. The 1.4-tonne HC 4000 bomb dropped by the British air force during World War Two was uncovered on a building site on Wismarer Strasse in Frankfurt’s leafy Westend where many wealthy bankers live.
    ‘We have never defused a bomb of this size,’ bomb disposal expert Rene Bennert told Reuters, adding that it had been damaged on impact when it was dropped between 1943 and 1945.
    Bomb disposal experts who examined it said the massive evacuation could wait until the weekend. ‘We are still working on the modalities of the evacuation plan,’ a spokeswoman for Frankfurt police said on Wednesday.
    As a result, ahead of Sunday’s planned evacuation, more than 100 hospital patients, including premature infants and those in intensive care, were evacuated from two Frankfurt hospitals on Saturday, city councillor Markus Frank told Reuters television.

    This post was published at Zero Hedge on Sep 2, 2017.

  • Germany’s New Political Party Is Just Another Big-Government Party

    The German election is a month away and with that also from a real rarity: a party getting into parliament which is on the “right” of Angela Merkel’s CDU and its Bavarian partner, the CSU. Over the last decades, this has been a no-go zone in German politics, too severe were the memories of the Nazi era. But come September, the Alternative fr Deutschland (Alternative for Germany), or AfD, will set a landmark, beating the five percent threshold to get into parliament in all likelihood (currently they are polling between seven and ten percent).
    As we have seen throughout the years, those considered as ‘right-wing populists’ in the mainstream are by no means a homogeneous group, from Brexiteers in the UKIP and on the fringe of the Tories as somewhat favorable examples to more frightening ones like Marine Le Pen in France. But what kind of party is the AfD?
    The AfD was founded in 2013 by a bunch of economics professors – at first they were mockingly called’Professorenpartei’ (‘professor’s party’) – who were fed up by the crisis in Greece and demanded a German exit from the Eurozone. Among them were economists like Joachim Starbatty and Roland Vaubel, known in Germany for their free-market ideas. The goal was to found a party which would reconcile the cultural conservatism that was lost in the conservative CDU and the liberal economic policies that were lost in the classical-liberal party, the FDP. However, the AfD focused increasingly on refugees instead of the euro, which led to the departure of many of its founding members in 2015, including the leader up to that point, Bernd Lucke.

    This post was published at Ludwig von Mises Institute on August 30, 2017.

  • Gartman: “Yesterday The ‘Machines’ Came In And The Game Changed”

    With Gartman’s August 11 prediction that “the bull market has come to an end” (which carried the added bonus that Gartman’s “reputation” was also on the line, once the “commodity guru” was proven wrong) long forgotten, and in fact both on CNBC and in his latest note to clients, Gartman once again declaring that it is a bull market after all, lately it has become difficult to read Gartman’s latest missives and trade recommendations (if only to do the opposite), as recent events appear to have deeply scarred the confidence of the CNBC Fast Money guest, who barely dares to make any forecasts. That said, he does continue to have an uncanny approach to “Gartsplaining” market events, and in this regard his latest note was certainly no exception.
    Here is the money excerpt from his latest letter
    STOCKS, IN THE STRANGEST OF WAYS, ARE NEARLY UNCHANGED as measured by our proprietary International Index wherein six of the ten markets comprising our Index have risen… none by more than 1%… and as four have fallen, with Germany’s 1.5% loss leading the way to the downside. In the end, our International Index has gained a marginal 4 ‘points’ but also in the end the fact that the markets collectively were able ‘accept’ the supposed threat from North Korea; were able to shrug off that threat and in the case the markets in North America were able to finish the day higher was certainly most impressive.

    This post was published at Zero Hedge on Aug 30, 2017.

  • Weird Things Are Happening With Gold

    Authored by James Rickards via Daily Reckoning blog,
    Last week featured two unusual stories on gold – one strange and the other truly weird. These stories explain why gold is not just money but is the most politicized form of money.
    They show that while politicians publicly disparage gold, they quietly pay close attention to it.
    The first strange gold story involves Germany…
    The Deutsche Bundesbank, the central bank of Germany, announced that it had completed the repatriation of gold to Frankfurt from foreign vaults.
    The German story is the completion of a process that began in 2013. That’s when the Deutsche Bundesbank first requested a return of some of the German gold from vaults in Paris, in London and at the Federal Reserve Bank of New York.

    This post was published at Zero Hedge on Aug 30, 2017.

  • Germany Increased Tax Collections 4.3% 1st Half 2017

    The Germany has posted a stunning 4.3% rise in tax revenues during the first half of 2017. I have warned that while the ECB keeps buying government bonds to ‘stimulate’ the economy, they keep trying to sterize the expansion by raising taxes and hunting people for taxes.

    This post was published at Armstrong Economics on Aug 30, 2017.

  • Mario Draghi’s Fatal Conceit

    On 23 August 2017, the president of the European Central Bank (ECB) gave a speech titled ‘Connecting research and policy making’ at the annual assembly of the winners of the Nobel Price for Economics in Lindau, Germany.1 What Mr Draghi talked about on this occasion – and especially what he didn’t talk about – was quite revealing.
    Any analysis of the causes of the latest financial and economic crisis is conspicuously absent from Mr Draghi’s remarks. One gets the impression that the crisis came basically unexpected, out of the blue. There is no mention of the role of central banks, the monopoly producers of unbacked paper (or: fiat) money, played for the crisis.
    No word that central banks had for many years manipulated downwards interest rates – accompanied by an excessive increase in credit and money supply – causing an unsustainable ‘boom.’ When the bust set in – triggered by the spreading of the US subprime crisis across the globe – the ugly consequences of this central bank monetary policy came to the surface.
    In the bust, many governments, banks and consumers in the euro area found themselves financially overstretched. The economies of Southern Europe especially do not only suffer from malinvestment on a grand scale, they also found themselves in a situation in which they have lost their competitiveness.

    This post was published at Ludwig von Mises Institute on August 30, 2017.

  • Futures Flat As Gasoline Soars On Harvey Devastation, Rising Euro Sends European Stocks Lower

    With billions in economic losses and unknown supply chain shocks to come following devastating and historic flooding in Texas, S&P futures are virtually unchanged (down less than 0.1% at time of writing) while European and Asian shares are modestly lower as oil was little changed. As reported yesterday, gasoline futures surged as the greater impact of the storm that shut more than 10% of U. S. fuel-making capacity was becoming more evident. The Bloomberg Dollar Spot Index fell to its lowest since January 2015 after Janet Yellen and Mario Draghi refrained from discussing monetary policies at Jackson Hole on Friday.
    The US dollar continued to slip against the euro after central bankers’ comments at Jackson Hole provided little reason for a change in this year’s trend. U. S. Treasury futures were steady ahead of a combined $60 BN worth of two- and five-year debt auctions and Friday’s payroll numbers. USDJPY hovered above 109.00 handle, with initial main support at 108.60, the low on Aug. 18. EURUSD little changed after rallying initially, but failed to break above 1.20 handle. European bond markets were waiting for impetus as a bank holiday in the U. K. weighed on trading volumes.
    Unlike the US, European stocks started the week on the back foot, with every sector retreating following Friday’s euro surge. the European Stoxx 600 index declined following a surge in the euro towards $1.20 after Draghi did not express concern about the currency’s recent rally at Jackson Hole as some analysts had expected. The Euro Stoxx 50 falls 0.7%, while the exporters-heavy DAX drops 0.7% and France’s CAC falls 0.7%; U. K. markets are closed for public holiday. Germany’s DAX Index fell 0.5 percent to the lowest in a week.

    This post was published at Zero Hedge on Aug 28, 2017.

  • The Truth About Bundesbank Repatriation of Gold From U.S.

    – Bundesbank has completed a transfer of gold worth 24B from France and U. S.
    – Germany has completed domestic gold storage plan 3 years ahead of schedule
    – In the 7.7 million plan, 54,000 gold bars were shipped and audited
    – In 2012 German court called for inspection of Germany’s foreign gold holdings
    – Decision to repatriate from Paris and New York was ‘to build trust and confidence domestically’
    – 1,236t or 37% of German holdings remain in New York Fed facility
    – Bundesbank wants to hold gold bullion
    – U. S. government declines to audit gold reserves … doesn’t want world to realise gold’s importance in the global monetary system
    Editor: Mark O’Byrne
    Last Monday, U. S. Treasury Secretary Mnuchin feigned to inspect the U. S. gold reserves in Fort Knox and joked flippantly that he assumed it was there.
    A day later the Bundesbank, announced that they had repatriated much of their gold reserves from the U. S. and France. Coincidence or coordination?

    In 2013 the Deutsche Bundesbank announced plans to store half of its gold reserves in Germany. At the time, only 31% was stored in the country. The Gold Storage Plan involved bringing gold home from both Paris and New York.

    This post was published at Gold Core on August 25, 2017.

  • Germany & The US Strangely Broadcast Messages About Gold Holdings – Episode 1363a

    The following video was published by X22Report on Aug 24, 2017
    UK retail sales decline at the fastest pace since 2016. Sears is in trouble they are closing more stores as sales decline. First it was new home sales, now its existing home sales, the real estate market is imploding. Germany has been repatriating their gold and the US visited Fort Knox to assure the American people that the gold is there. Why now, are countries preparing the collapse of the system . Looking at the gold Germany has received something does not look right.