China Credit Worries Rise as Large Shadow Banking Default Looms
China faces the first big test of its shadow banking system, in the form of a pending default. How is it likely to fare?
Read more...Category Archives: Doomsday scenarios
Gail Tverberg: How the EIA, IEA, and Other Researchers Are Modeling the Wrong Growth Limit
Why the real constraint on energy production isn’t the availability of resources, but the cost of developing them, and how these neglected investment constraints have big ramifications for “peak energy” and economic growth generally.
Read more...In Echo of Runup to Crisis, Bond Investors Reaching for Yield
An article in the Financial Times by Tracy Alloway gives yet another sighting that bond investors are getting a bit frantic in their hunt for yield. The piece has the eyepopping title, Yield-hungry investors snap up US homeless bond. It uses recent deals in the CMBS (commercial mortgage backed securities) market as a proxy for bond investors’ QE-driven hunt for more return.
Read more...How Serious is China’s Shadow Banking/Wealth Management Products Problem?
George Soros has caused a bit of a frisson by calling China the greatest risk to the global economy. The Chinese shadow banks are the trouble spot to watch.
Read more...Death By A Thousand Cuts: The Silent Assassination Of European Democracy
The European Union is riddled with fatal flaws and defects. Chief among them is the single currency which, rather than serving as the Union’s springboard to global dominance, could well be its ultimate undoing.
Read more...Ilargi: The Taper And The China Credit Power Struggle Squeeze
Yves here. We described the funding mismatch with Chinese wealth management products during the first liquidity crunch earlier in the year, but given that most readers aren’t familiar with these structures, it’s good to have another summary as to how they work and more discussion of why they pose a risk to the Chinese economy. They are troublingly similar to structured investment vehicles, which were one of the detonators of the credit crisis in the US and UK.
Read more...Open Thread: Best and Worst of 2013
What do you flag as the standout events of 2013 and why?
Read more...Michael Hoexter: Malign Confusion about Growth, Economic Growth or “Degrowth”: Which Way Forward? – Part 2
Yves here. One of the big problems with the growth v. “de-growth” debate is how terrible our measures of productive activity are.
Read more...Tom Adams: Citigroup is the Real Reason We Need the Volcker Rule
In my view the real purpose of the Volcker Rule is to prevent another Citigroup bailout and therefore the measure of its effectiveness is whether the rule would accomplish this.
Read more...Ilargi: Debt Rattle – E/U in 2014?
A look at some predictions for Europe in 2014.
Read more...Ragnarok – Iceland and the ‘Doom of the Gods’
Iceland is widely portrayed as a post-bubble success story, but the reality is more conplex.
Read more...Yanis Varoufakis: Confessions of an Erratic Marxist in the Midst of a Repugnant Eurozone Crisis
Yves here. Even though Yanis Varoufakis has savaged the Trokia’s austerity policies that are driving Greece and other periphery countries into economic and social distress as well as fueling the rise of extreme right wing parties, some readers of this blog have criticized him for advocating reforms to pull the Eurozone out of its nosedive […]
Read more...Ilargi: All The Plans We Make For Our Futures Are Delusions
What worries me most about the world today, in the last weeks before Christmas and New Year’s Day 2014, is that all the plans we make for our futures and more importantly our children’s futures are DOA.
Read more...Rob Parenteau: How to Exit Austerity, Without Exiting the Euro
Yves here. This is an important post by Rob Parenteau which outlines a viable plan for subject nations austerity-afflicted Eurozone countries with reasonably-well-functioning tax bureaucracies to escape their downspiral.
Read more...Ilargi: Everything’s Fine In A Parallel Universe
Last week, I was reading parts of a report issued by Japanese investment bank Nomura, which started out saying that the “Global Financial Crisis” is over. If I lay out a statement like that side by side with a lot of other things I see, I can only conclude that Nomura doesn’t reside in the same universe I do.
Read more...