BRICS the Rise & Fall

The first thing to go when a country is moving into economic crisis is the arts. This is intermixed with various social programs. As the economic crisis broadens, demand for taxing the rich rise. However, all this accomplishes is to cause capital to hide and hoard even more refusing to invest or spend and this then adds to the economic decline.
The BRICS were touted as the new rage in the world economy. The BRICS were even holding their own summits and they were supposed to surpass the G7, were all the forecasts. Brazil, Russia, India, China and South Africa became known as the ‘BRIC’ nations back in 2001 which was a term coined by of course Goldman Sachs.

This post was published at Armstrong Economics on Dec 27, 2017.

3/12/17: Russian and BRICS debt dynamics since 2012

Back in 2014, Russia entered a period of recessionary economic dynamics, coupled with the diminishing access to foreign debt markets. Ever since, I occasionally wrote about the positive impact of the economy’s deleveraging from debt. Here is the latest evidence from the BIS on the subject, positing Russia in comparative to the rest of the BRICS economies:

This post was published at True Economics on Sunday, December 3, 2017.

9/10/17: BRIC Composite PMI 3Q: Failing Global Growth Momentum

Two posts above cover Manufacturing PMIs and Services PMIs for 3Q 2017 for BRIC economies. The following updates Composite PMIs performance. Global Composite PMI came in at 53.7 in 3Q 2017, matching exactly 1Q and 2Q 2017 readings and basically in line with 53.6 reading in 4Q 2016. In other words, Global Composite activity PMI index has been showing relatively robust growth across the two key sectors for the last 4 quarters running. In contrast to Global indicator, BRIC economies posted relatively underwhelming performance with exception of Russia. Brazil Composite PMI index stood at 50.0 (zero growth) in 3Q 2017, which is a marginal gain on 49.8 in 2Q 2017. This marks the first time since 1Q 2014 that Brazil Composite indicator reached above the outright contraction levels, but it is a disappointing reading nonetheless. For one, one quarter does not signal stabilisation in Latin America’s largest economy. Worse, Brazil’s economy has been performing poorly since as far back as 2H 2011. It will take Brazil’s Composite index to hit above 52 mark for 2-3 consecutive quarters to start showing pre-2011 levels of activity again. Russia Composite PMI, on the other hand, remains the bright spark in the BRIC’s dark growth universe. Although falling to 4 quarters low of 54.1 in 3Q 2017, the index remains in strong growth territory. 3Q 2017 marked 6th consecutive quarter of robust post-recession recovery, consistent with 2.5-3 percent growth in GDP, quite ahead of the consensus forecasts from the start of 2017. The last quarter also marks the sixth consecutive quarter of Russian Composite PMIs running above Global Composite PMIs. This means that for the last 18 months, Russia has been the only positive contributor to Global growth from amongst the ranks of the BRIC economies.

This post was published at True Economics on Monday, October 9, 2017.

Dr Bouthain Shaaban: ‘Catching a Glimpse of Tomorrow’s World’

Dr Bouthaina Shaaban, Political & Media Advisor to Syrian President, Bashar Al Assad
Despite all the pain and suffering imposed by the ongoing nihilistic wars in our region, I thank God that we are witnessing this historical era, which is one of the most complex eras mankind has passed through. The daily regional and international events reinforce an image I’ve painted in my mind for the past six years about how the world we know is moving slowly to be replaced by another world; and the transition will take few years to be completed.
I see two different intersecting circles today, and we can only see a sliver of each circle, but the intersecting parts remain hidden. In the BRICS summit that took place in China few days ago, I could see signs of the new world, a glimpse of the coming decades, what our children and grandchildren will definitely see in their lifetime, and I was pleased by what I saw.
I saw the BRICS leaders arriving at the summits and being welcomed by a body language that entails respect and parity, and everyone had a happy expression on their faces, signalling their liberation from having to deal with the supremacists who reside on the other half circle. I saw the First Lady of China standing very humbly and elegantly, wearing a silk dress made in China, representing a country with a great civilisation that is preparing to revive the Silk Road, which would change the identity and life style of the entire world.

This post was published at 21st Century Wire on SEPTEMBER 18, 2017.

Escobar Exposes Real BRICS Bombshell: Putin’s “Fair Multipolar World” Where Oil Trade Bypasses The Dollar

Putin reveals ‘fair multipolar world’ concept in which oil contracts could bypass the US dollar and be traded with oil, yuan and gold…
The annual BRICS summit in Xiamen – where President Xi Jinping was once mayor – could not intervene in a more incandescent geopolitical context.
Once again, it’s essential to keep in mind that the current core of BRICS is ‘RC’; the Russia-China strategic partnership. So in the Korean peninsula chessboard, RC context – with both nations sharing borders with the DPRK – is primordial.
Beijing has imposed a definitive veto on war – of which the Pentagon is very much aware.
Pyongyang’s sixth nuclear test, although planned way in advance, happened only three days after two nuclear-capable US B-1B strategic bombers conducted their own ‘test’ alongside four F-35Bs and a few Japanese F-15s.

This post was published at Zero Hedge on Sep 6, 2017.

The Old Economy Is Giving Way To A New Economic System – Episode 1362a

The following video was published by X22Report on Aug 23, 2017
Trump continually says he is going to kill the NAFTA agreement. It is time he does so. New home sales implode and the corporate media is now warning that the real estate market might not be as strong as originally thought. Service industry surges upward but manufacturing declines. The corporate media is now reporting that the economy is showing signs that it might enter a recession in the next 12 months. The old economy is dying and the new economy is gaining speed and the BRICS nations are behind it.

The Bad Guys Are Cowering In The Corner As The Good Guys Clean House – Episode 1344b

The following video was published by X22Report on Jul 30, 2017
Trump and the good guys are now pushing the bad guys out, the elite are now panicking. A special counsel has been created to investigate Clinton, Comey and Lynch. US and Canada are telling its citizens to leave Venezuela. North Korea fired another missile, the bad guys want war and they are pushing the story that NK fired and ICBM and now its time to take action. The deep state is pushing the story that Russia is arming the Taliban, this is to push Trump into sending more troops. Russia invites BRICS to fight terrorism. The bad guys are still pushing their agenda they are training terrorists covertly in Jordan.

Gold Likely to Stay Elevated on Safe Haven Demand: Economist

This week spot gold closed at $1,284.77, down $3.11 per ounce, or 0.24 percent. Gold stocks, as measured by the NYSE Arca Gold Miners Index, ended the week lower by 3.62 percent. Junior-tiered stocks outperformed seniors for the week, as the S&P/TSX Venture Index off just 1.16 percent. The U. S. Trade-Weighted Dollar Index finished the week lower by 0.62 percent.
All the precious metals were off slightly this week with platinum, gold and palladium off 0.16 percent, 0.24 percent and 0.28 percent, respectively. Treasuries extended their gains earlier in the week as soft inflation data from the U. S. fed into the markets and the dollar dropped, reports Bloomberg. Macro news ranging from inflation data casting doubt on the pace of rate hikes to the U. S. decision not to label any countries as currency manipulators have extended the advance in haven assets. Gold climbed to a five-month high in New York, reports Bloomberg, with the Bloomberg Dollar Spot Index falling 0.3 percent. ‘Gold will likely stay elevated given safe haven demand,’ Barnabas Gan, economist at OCBC, said. ‘I won’t be surprised if gold breaches above its $1,200 handle in the foreseeable future.’ On Friday, gold traders and analysts surveyed by Bloomberg were bullish on the yellow metal’s price outlook for a sixth week. Sberbank, Russia’s largest bank, is looking to finance the direct import of gold to India, according to Aleksei Kechko, Managing Director of the company’s Indian subsidiary. India is the world’s second largest importer of gold, and a direct trade between India and Russia would be beneficial to both countries. Russian officials have already signaled their desire to conduct transactions with BRICS nations using gold, writes Russia Insider. In related news, India’s Trade Ministry is preparing a proposal to cut the gold import duty to 2 percent in two years from 10 percent, ET Now and Newswire reports.

This post was published at GoldSeek on 24 April 2017.

Russia, China Lay Groundwork For BRICS Transactions in Gold

As we reported last week, Moscow and Beijing took another step towards de-dollarization with the opening of a yuan clearing bank in Russia. And earlier this month Russia’s Central Bank opened its first-ever foreign branch in Beijing to allow for better communication between Russian and Chinese financial authorities.
According to an article published yesterday by Sputnik, progress made in promoting bilateral trade in yuan is the first step towards an even more ambitions plan – using gold to make transactions:
The clearing center is one of a range of measures the People’s Bank of China and the Russian Central Bank have been looking at to deepen their co-operation. One measure under consideration is the joint organization of trade in gold. In recent years, China and Russia have been the world’s most active buyers of the precious metal. On a visit to China last year, deputy head of the Russian Central Bank Sergey Shvetsov said that the two countries want to facilitate more transactions in gold between the two countries.

This post was published at Russia Insider

Russia Readies Back-up System For Potentially Explosive ‘Split With International Banking System’

The grand order of things could be undergoing some major overhauls.
To put it more bluntly, a war to reset the global financial order is about to be unleashed.
Preparations inside Russia are being made in case the ultimate banking sanctions are placed on them, cutting off commerce inside the all-encompassing Worldwide Interbank Financial Telecomm SWIFT system – which runs credit, debt, and banking card transactions across a real time global network.
As it would be doled out by the banking elites, the price for misbehavior at the Kremlin could be ostracization from this global commerce vehicle.
But that isn’t the end of the story… Putin is readying his people to divorce from the international banking system altogether, and start over with a nationalistic platform, backed by thousands of tons of gold, and growing alliances with Europe, China and the BRICS nations, the Middle East and several emerging powers.
A major attempt to bring Russia under heel could result in the greatest schism the global system of finance has ever seen. Then what?

This post was published at shtfplan on March 24th, 2017.

5/1/17: Global Growth Upside: More BRICs, less B

Back at the end of 3Q 2016, I contributed a chart to Business Insider feature covering most important trends that analysts’ keep an eye over. You can see the chart here: The key to global growth, in my opinion, will be recovery led by the emerging markets, and in particular – by world’s largest emerging economies, the BRICs.

This post was published at True Economics on Friday, January 6, 2017.

India Economy Falls into Chaos – Dollar Rise in Huge Demand

US dollars are soaring in premiums on the street. There is a serious risk that the government has shaken the confidence of the people to such a degree, that they trust the US dollar more than their own currency. Prime Minister Narendra Modi has come out an said the currency changeover could still take a few weeks and could lead to inconveniences, according to the magazine Brics. The Indian economy is a highly cash transacted economy far more so than the United States and Europe. The government has brought the economy to a virtually standstill. Food stores are close to closing because the customers have no money. Small and medium-sized enterprises have stopped functioning because the invoices are not paid for.

This post was published at Armstrong Economics on Nov 25, 2016.

President of Russia answered questions from Russian journalists following the BRICS Summit in Goa

Question: Much is being said in the Western media about BRICS going through a rough patch. Since Brazil got a new president, the country has been allegedly thinking whether it needs BRICS. There is little secret about the tension that exists between India and China. In fact, the US has been increasingly proactive regarding India.
You have said on a number of occasions that you view BRICS as an important and viable association. How serious do you think are the challenges, if any, that BRICS face? Will BRICS succeed in overcoming them and what are the development prospects for BRICS in general?
President of Russia Vladimir Putin: Some of our partners are always trying to dig up issues and challenges, no matter what we do. But as we say in Russia, why worry about a speck in your friend’s eye when you have a log in your own.
There are always issues, anywhere and in relations between any countries. Does this mean that countries whose representatives talk about BRICS this way do not have any issues with their closest strategic partners and allies? As a matter of fact, they have plenty of issues.
If there were no problems, they would have signed and ratified the Transatlantic Trade and Investment Partnership (TTIP) a long time ago, and would have resolved many other issues. However, the issues they face are still there, and they are real. So there is nothing special about having problems. This is how things work across the world.

This post was published at The Saker

The whole game is about containing Russia and China — Pepe Escobar

The next BRICS summit, in Goa, is less than two months away. Compared to only two years ago, the geopolitical tectonic plates have moved with astonishing speed. Most BRICS nations are mired in deep crisis; Brazil’s endless political/economic/institutional debacle may yield the Kafkaesque impeachment of President Dilma Rousseff.
BRICS is in a coma. What’s surviving is RC: the Russia/China strategic partnership. Yet even the partnership seems to be in trouble – with Russia still attacked by myriad metastases of Hybrid War. The – Exceptionalist – Hegemon remains powerful, and the opposition is dazed and confused…or is it?
Slowly but surely – see for instance the possibility of an ATM (Ankara-Tehran-Moscow) coalition in the making – global power continues to insist on shifting East. That goes beyond Russia’s pivoting to Asia; Germany’s industrialists are just waiting for the right political conjunction, before the end of the decade, to also pivot to Asia, conforming a BMB (Berlin-Moscow-Beijing) coalition.
Germany already rules over Europe. The only way for a global trade power to solidify its reach is to go East. NATO member Germany, with a GDP that outstrips the U.K., Canada, Australia and New Zealand, is not even allowed to share information with the ‘Five Eyes’ secret cabal.

This post was published at Sputnik News

Words Still Mean Things – Brexit – with Graham Mehl

Last time our piece focused on what has come to be known as ‘escape velocity’ and how an aeronautical term has come to be used to provide some boost to the perception of the USEconomy when in fact it actually has no velocity whatsoever. This week we’re going to take a look at another term, and even though it is an amalgam of two words, it still has profound meaning.
It would appear, at least according to the media, that few in England actually know much about the idea of Brexit and what it means for them, their families, their country, and their way of life. We surmise that even fewer Americans understand the ramifications it might have for the US.
Brexit, in short, stands for ‘Britain Exit’. Exit from what? Exit from the European Union. Britain is kind of an anomaly in many ways regarding its membership in the EU. For one, Britain still has its own currency, the Pound. Britain also has some geographic separation from the EU as well and is still a very strong banking hub, rivaling that of New York, Brussels and the BRICS Bank.
The purpose of this paper is not to provide analysis of whether or not Britain should exit (although we both believe it should AND whole failed EU be dissolved for that matter), but to take a look at some of the factors driving the referendum, perceptions and connotations surrounding the term Brexit, and look at the fact that if this happens it would be akin to a major US state seceding from the (now) forced union that is the United States. The economic ramifications are far reaching, and as yet not quantifiable, but we’ll likely do a follow-up and take a look at what we might be able to expect with regards to the financial markets and the global economy. We’ll say up front that we don’t believe a vote to exit the EU is equivalent to the end of the world financially or economically, even if the establishme.

This post was published at GoldSeek on 20 June 2016.

Terrorism As Pretext For Intervention In Middle East

In order to understand the hype surrounding the phenomena of Islamic radicalism and terrorism, we need to understand the prevailing global economic order and its prognosis. What the pragmatic economists have forecast about the free market capitalism has turned out to be true; whether we like it or not. A kind of global economic entropy has set into motion. The money is flowing from the area of high monetary density to the area of low monetary density.
The rise of the BRICS countries in the 21st century is the proof of this tendency. BRICS are growing economically because the labor in developing economies is cheap; labor laws and rights are virtually nonexistent; expenses on creating a safe and healthy work environment are minimal; regulatory framework is lax; expenses on environmental protection are negligible; taxes are low; and in the nutshell, windfalls for the multinational corporations are huge.
Thus, BRICS are threatening the global economic monopoly of the Western capitalist bloc: that is, North America and Western Europe. Here we need to understand the difference between the manufacturing sector and the services sector. The manufacturing sector is the backbone of the economy; one cannot create a manufacturing base overnight. It is based on hard assets: we need raw materials; production equipment; transport and power infrastructure; and last but not the least, a technically-educated labor force. It takes decades to build and sustain a manufacturing base. But the services sector, like the Western financial institutions, can be built and dismantled in a relatively short period of time.

This post was published at Zero Hedge on JUN 16, 2016.

How banks are killing the host that feeds them — Book Review

There is a growing suspicion on the left that the anti-Zuma and anti-Dilma Rousseff campaigns in South Africa and Brazil are part of a calculated demolition of BRICS by the West. Killing the Host by Michael Hudson attempts to explain how the global financial system works, and it bears no resemblance to what we were taught in university.
Michael Hudson is regarded by some as the best economist in the world, though his anti-establishment views guarantee he will never win a Nobel prize. His most recent book ‘Killing the Host’ is a brutal dissection of how a ‘parasitic’ financial sector has the world in a death grip.
Hudson started out studying music and the history of culture, but an evening spent with Terence McCarthy, then an economist with General Electric, altered the course of his life. He decided to become an economist. McCarthy explained why most economic crises happen during the northern hemisphere autumn, when crops are harvested and moved to market. The logic was simple: when crops failed, the banks were drained of cash and forced to call up their loans.
The current financial system carries within it the seeds of its own inevitable destruction, says Hudson. One factor above all others guarantees economic collapse: the mathematics of compound interest. The financial system expands faster than the underlying economy, overburdening it with debt which can never be repaid. Financial ‘parasites’ in the form of banks, hedge funds and investment firms have replaced governments around the world as collectors of economic rent in the form of interest payments on loans. Central banks are co-conspirators in this grand deception, by unleashing tidal waves of money to support stock and asset prices, primarily for the benefit of the elite.

This post was published at Moneyweb

The US Dollar Is The Biggest Bubble on the Planet And Has Just Began To Pop

The following video was published by TheDollarVigilante on May 31, 2016
Jeff interviews The Dollar Vigilante’s Senior Analyst, Ed Bugos. Topics include: Ed’s staggeringly profitable multi-bagger option calls for TDV subscribers in 2016 and his astonishing record of successful stock picks and market predictions over the last decade, the 3 commonly held myths concerning the US dollar, the disastrous decisions of the central banks, the real effects of quantitative easing, the mistaken belief in the US dollar as a safe haven, US dollar and dollar assets very widely over-owned, the BRICS nations have not been inflating as much as the US nor has Japan, the biggest bubble in the world is the us stock market and bond market, the US is the world’s biggest debtor, US markets the most vulnerable to foreign actions, when the US stock market goes down the dollar will go with it, the last time there were zero interest rates was after WWII, a real risk of hyperinflation, the real story is of the dollar crisis.