Courtesy of: Visual Capitalist
Tag: EU
NIGEL FARAGE: EU BEHAVING LIKE MAFIA
Why the Fed Needs to Raise Rates
Guest Post by Martin Armstrong
I have warned that rates will rise BECAUSE the Federal Reserve will be criticized if they fail to do so when they are faced with a stock market that is rising. However, while one by one, several Fed officials have all signaled in recent days that the Fed is ready to resume raising interest rates as soon as this month, the real crisis for the Fed will be raising rates will strength the dollar and put even more pressure on Europe and emerging markets. Hence, the 64 billion dollar question is will the Fed abandon international policy objectives for domestic?
Le Pen Attacks Merkel in Parliament Representing a Free Europe
Guest Post by Martin Armstrong
The EU Dream of creating a federalized Europe is collapsing. The immigration crisis was created by Merkel solely for he personal popularity was collapsing due to her hard stance against Greece. The Eurozone is collapsing and Brussels still refuses to recognize that they have gone too far beyond a mere trade union trying to create one government of Europe.
Hollande previously said that forcing Europe into a single federalized government was to end European War. This European Project has created the risk of internal civil war by trying to force an agenda upon a people no different than what Napoleon and Hitler attempted using military strength. Today, Brussels seeks the same end goal – a single European State.
Alan Greenspan Says Eurozone Isn’t Working
From Birch Gold Group
This week, Your News to Know rounds up the hottest topics from the world of finance and the gold market. Stories include: Former Fed chair says eurozone isn’t working, gold gets tailwind from inflation and China, and new Alabama bill would encourage use of gold and silver as currency.
Alan Greenspan: The eurozone is not working
In an interview for the February issue of the World Gold Council’s “Gold Investor” magazine, former Federal Reserve Chair Alan Greenspan didn’t hold back on criticism over the eurozone. As seen on Business Insider, Greenspan believes that wealthy northern nations such as Germany are funding less prosperous southern members, which compromises the integrity of the entire eurozone.
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The Ship is Sinking
Guest Post by Martin Armstrong
Do not put equities in the same boat with bonds. The ship is sinking, but that is concerned with debt – not equity. Keep in mind that the collapse of a financial system has historically unfolded to different degrees. If we are talking about a Dark Age, then you are into the Mad Max situation. Then the only thing that has value is food – not even gold.
That was the fall of Rome. People effectively sold themselves as serfs to work the land, retain 20% of the crop in return for protection behind the castle walls. Medieval coinage really appears only in silver and are rarely found more than 20 to 30 miles from where the coins were struck. This illustrated the isolation of city states. Money was not really necessary for there was really no major trade interacting within Europe – hence the Dark Age.
Is the CIA Responsible for Creating the EU?
Guest Post by Martin Armstrong
The new conspiracy theory running around claims that the European Union was a CIA project. This serious distortion misses the entire point. It is very true that the idea of the EU was supported by the United States since World War II including the CIA. However, the U.S. supported the idea of the EU as a trade union that could support NATO during the Cold War. However, the idea of federalizing Europe came, not from the United States, but from France. It was de Gaulle who blocked Britain from joining the EU because he wanted France to dominate Europe. It was de Gaulle who broke Bretton Woods by buying up dollars and redeeming them for gold to make France the economic power of Europe. Britain was only allowed to join the EU upon de Gaulle’s death.
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Europe’s Latest Steps to Eliminate Cash Post-Davos
Guest Post by Martin Armstrong
Within days of Davos, here in the European Commission statement on moving forward to eliminate cash. This is an “Inception Impact Statement” to provide notice to those involved and to ask for comments back. Everything is couched in terms of terrorism, but in fact it is to hunt taxes and eliminate our freedom to privacy regarding our own wealth. The Roman Emperor Maximinus I (235-238AD) declared that all wealth belonged to the state. He paid informants to rat out anyone who looked like they were hiding wealth. The bottom-line, this pushed the Roman Empire over the edge.
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A BIASED 2017 FORECAST (PART TWO)
In Part One of this article I discussed the failure of our brains to think rationally due to our biases and the relentless propaganda flogged by our Deep State ruling class. Viewing the future through the looking glass of the Fourth Turning keeps you focused on the three catalysts which will drive all events in 2017 and beyond. I’ve addressed my 2017 Debt forecast in Part One. Now I will make some guesses about what might happen in 2017 related to Civic Decay and Global Disorder.
Civic Decay Forecast
“Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance.” – Daniel Kahneman, Thinking, Fast and Slow
The presidential election and its aftermath tell you everything you need to know about the level of civic decay overtaking this country. The country is as divided as it was after the election of Abraham Lincoln in 1860. There is virtually no common ground between liberals and conservatives. The pure hatred and contempt between the winners and losers in the recent election does not bode well for the country over the next four to eight years.
The social fabric of the country has been torn asunder. The Clinton supporters believe anyone not on their side is deplorable, racist, misogynist, and fans of Hitler. Trump supporters believe anyone not on their side is low IQ, Muslim loving, deceitful, math challenged, and fans of a criminal. The gulf between the two sides is unbridgeable.
A BIASED 2017 FORECAST (PART ONE)
“The idea that the future is unpredictable is undermined every day by the ease with which the past is explained.” – Daniel Kahneman, Thinking, Fast and Slow
A couple weeks ago I was lucky enough to see a live one hour interview with Michael Lewis at the Annenberg Center about his new book The Undoing Project. Everyone attending the lecture received a complimentary copy of the book. Being a huge fan of Lewis after reading Liar’s Poker, Boomerang, The Big Short, Flash Boys, and Moneyball, I was interested to hear about his new project. This was a completely new direction from his financial crisis books. I wasn’t sure whether it would keep my interest, but the story of Daniel Kahneman and Amos Tversky and their research into the psychology of judgement and decision making, creating a cognitive basis for common human errors that arise from heuristics and biases, was an eye opener.
In psychology, heuristics are simple, efficient rules which people often use to form judgments and make decisions. They are mental shortcuts that usually involve focusing on one aspect of a complex problem and ignoring others. These rules work well under most circumstances, but they can lead to systematic deviations from logic, probability or rational choice theory. The resulting errors are called “cognitive biases” and many different types have been documented.
Strangers
Guest Post by The Zman
The purpose of the European project, at least the purpose sold to the public, was to provide long term stability to the continent, particularly economic stability. The lesson of the first fifty years of the 20th century was that nationalist competition among states led to economic instability and war. Therefore, cooperation among the nations of Europe on economic matters, as well as a common defense, would keep the peace and allow all nations to prosper together, as one continent.
Talk to sophisticated Europeans and they will give you some version of how a united Europe has kept the peace. Many will argue that open borders and a single currency have been the solution. The Euro has become a symbol for the end of individual people, replaced by the common people of Europe. One people, one currency. The economic and political arguments for Europe have become a religion of sorts for the sophisticated types. This was obvious in the Brexit vote, with all the shrieking and panic after it.
GREY CHAMPION ASSUMES COMMAND (PART TWO)
In Part One of this article I discussed the arrival of Grey Champions in previous Fourth Turnings; their attributes, deficiencies, and leadership skills; and why Donald Trump is the Grey Champion of this Fourth Turning – whether you like it or not. Now I will try to make sense of what could happen next.
“Our movement is about replacing a failed and corrupt political establishment with a new government controlled by you, the American people. The establishment has trillions of dollars at stake in this election. For those who control the levers of power in Washington and for the global special interests, they partner with these people that don’t have your good in mind. The political establishment that is trying to stop us is the same group responsible for our disastrous trade deals, massive illegal immigration and economic and foreign policies that have bled our country dry.
It’s a global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations and political entities. The only thing that can stop this corrupt machine is you. The only force strong enough to save our country is us. The only people brave enough to vote out this corrupt establishment is you, the American people.” – Donald Trump
Seventy year old Donald Trump has assumed the Grey Champion flagstaff. In an increasingly chaotic world, normal working class Americans in flyover country were seeking a leader who could bring order, defeat the corrupt establishment, make tough decisions, and capture the zeitgeist of this moment in history. The ruling elite oligarchs and their fawning minions, occupying their strongholds in New York, California, Illinois, and D.C., are infuriated the peasants have dared to resist. In their secretive secure spaces, the elites are plotting with one purpose in mind – this uprising must be quelled.
A World of Problems
Guest Post by The Zman
Back when the Germans were threatening to shut down Greece and sell it off for parts, it was fairly obvious that there was no way to “fix” the Greek problem. Even it were possible to radically overhaul their public sector, the debt payments are too high to maintain the level of social services expected from a modern social democracy. Default was unthinkable because close to 80 percent of Greece’s public debt is owned by public institutions, primarily the EU governments and the ECB.
The “solution” was to kick the can down the road until a miracle happened, but now the problem is back.
HOW ABOUT THEM APPLES – $14.5 BILLION OF THEM
Concluding a two-year long investigation, the European Commission has ordered Apple to pay up to €13 billion ($14.5 billion) in back taxes for its subsidiaries in Ireland. The Commission argues that Apple received “undue tax benefits” between 2003 and 2014, violating EU state aid rules.
As our chart illustrates, Apple’s provisions for income taxes outside of the United States amounted to just $4.89 billion during said period. According to the European Commission’s statement, the company paid an effective tax rate ranging from 1 percent in 2003 to 0.005 percent in 2014 on its European profits during the time. To put that in perspective, Apple paid an effective tax rate of 26.1 percent in the United States in 2014, with income taxes adding up to almost $60 billion between 2003 and 2014.
Both Apple and Ireland have already denied the Commission’s allegations and announced that they are going to appeal against today’s ruling. It will be interesting to see how this plays out in the end, as it may be the first case of a company being ordered to pay back taxes to a government that doesn’t even want the money.
You will find more statistics at Statista
EMERGENCY PLAN
IT’S NOT THE BREXIT STUPID
Just over a week ago the world was coming unglued, as enough British citizens grew a pair and spit in the face of the EU establishment and global elite by voting to exit the EU. The fear mongering by central bankers and their puppet political hacks failed to deter people who have become sick and tired of being abused and pillaged by bureaucrats working on behalf of bankers and billionaires.
Stock markets around the world plummeted on Thursday and Friday. The world braced for another Black Monday. The phone lines were buzzing between central bankers around the world over the weekend as their banker constituents demanded relief. If one thing has been proven over the last seven years, its a coordinated effort between central bankers and Wall Street banks to rig the stock market higher can work over a short time period.
The titans of finance were able to once again confound short-sellers and the prophets of doom with a 5% surge from the Friday lows over the next week. It was surely a coincidence the Fed declared all Wall Street banks, safe, sound, and capable of buying back their stocks to the tune of billions early in the week.
These insolvent zombies were now free to borrow billions to buy back their overvalued stocks, destroying shareholder value, while boosting executive compensation. Poor Jamie Dimon is struggling to get by on his $27 million per year. The Wall Street banks obliged by immediately announcing multi-billion dollar buyback schemes to capitalize on the short-term trading mentality of the 30 year old MBA trading geniuses who bought the news without worrying about the actual value of the stocks they were buying.