December 14th To 18th: A Week Of Reckoning For Global Stocks If The Fed Hikes Interest Rates?

Are we about to witness widespread panic in the global financial marketplace?  This week is shaping up to be an absolutely critical week for global stocks.  Coming into December, more than half of the 93 largest stock market indexes in the world were down more than 10 percent year to date, and last week stocks really started to slide all over the world.  Here in the United States, the Dow Jones Industrial Average is down about 600 points over the past week or so, and at this point it is down more than 1000 points from the peak of the market.  That brings us to this week, during which the Federal Reserve is expected to raise interest rates for the very first time since the last financial crisis.  If that happens, that could potentially be enough to accelerate this “slide” into a full-blown crash.

And just look at what is already happening.  Trading for stocks in the Middle East has opened for the week, and we are already witnessing tremendous carnage…

Following Friday’s further freefall in crude oil prices, The Middle East is opening down notably. Abu Dhabi, Saudi, and Kuwait are lower; Israel is weak and UAE and Qatar are tumbling, but Dubai is worst for now.  Dubai is down for the 6th day in a row (dropping over 3% – the most in a month) extending the opening losses to 2-year lows. The 11% drop in the last 6 days is the largest since the post-China-devaluation global stock collapse. Leading the losses are financial and property firms.

Things in Asia look very troubling as well.  As I write this, the Japanese market has just opened, and the Nikkei is already down 508 points.

In recent days I have been explaining to my readers how everything is lining up in textbook fashion for another major market crash.  In particular, the implosion of junk bonds is a major red flag.  Late last week, Third Avenue Management shocked Wall Street by freezing withdrawals from a 788 million dollar credit mutual fund.  The following comes from Bloomberg…

A day after a prominent Wall Street firm shocked investors by freezing withdrawals from a credit mutual fund, things only got nastier in the junk-bond market. Prices on the high-risk securities sank to levels not seen in six years and, to add to the growing sense of alarm, billionaire investor Carl Icahn said the selloff is only starting.

“The meltdown in High Yield is just beginning,” Icahn, who’s been betting against the high-yield market, wrote on his verified Twitter account Friday.

Icahn’s comments come as junk-bond investors, already stung by the worst losses since 2008, are the most nervous they’ve been in three years after Third Avenue Management took the rare step of freezing withdrawals from a $788 million credit mutual fund.

What Third Avenue Management just did was absolutely huge.  Now investors that have money in any similar funds are going to be racing to get it out.  We could be on the verge of a run on bond funds that is absolutely unprecedented.  This is so obvious that even CNBC’s Jim Cramer is sounding the alarm…

Friday was a day where Cramer’s ears were burning with concern because of the troubles discovered with a high yield bond fund run by Third Avenue Management. It decided to bar investors from getting their money out of its Focused Credit Fund, because it could not meet demands to get cash back to them in an orderly way.

This was significant because when it tries to sell the bonds needed to satisfy these orders for redemptions, it could destroy the high yield bond market because there are no buyers anywhere near the amount that they want to sell.

“I cannot emphasize enough just how disconcerting this move is,” Cramer said.

I know that for the ordinary person on the street, all of this sounds very complicated.

But it basically comes down to this – anyone that has a lot of money invested in these bond funds is in danger of getting totally wiped out.

In a situation like this, it is those that are “first out the door” that come out as the winners.  I like how Wolf Richter explained what we are currently facing…

It works like this: When an “open-end” bond fund starts losing money, investors begin to sell it. Fund managers first use all available cash to pay investors. When the cash is gone, they sell the most liquid securities that haven’t lost much money yet, such as Treasuries. When they’re gone, they sell the most liquid corporate paper. As they go down the line, they sell bonds that have already lost a lot of value. By now the smart money is betting against the fund, having figured out what’s happening. They’re shorting the very bonds these folks are trying to sell.

The longer this goes on, the more money investors lose and the more spooked they get. It turns into a run. And people who still have that fund in their retirement account are getting cleaned out.

Bond funds can be treacherous – especially if they hold dubious paper, which is never dubious until it suddenly is. And when they get in trouble, you want to be among the first out the door.

I would anticipate that we will see more junk bond carnage this week – especially if the Fed raises rates.

And as I have discussed previously, a stock crash almost always follows a junk bond crash.  If the Fed does raise rates this week and stocks do start falling significantly, one key day to watch will be Friday.  JPM’s head quant Marko Kolanovic has warned that “the largest option expiry in many years” will happen on that day…

This important event falls at a peculiar time—less than 48 hours before the largest option expiry in many years. There are $1.1 trillion of S&P 500 options expiring on Friday morning. $670Bn of these are puts, of which $215Bn are struck relatively close below the market level, between 1900 and 2050. Clients are net long these puts and will likely hold onto them through the event and until expiry. At the time of the Fed announcement, these put options will essentially look like a massive stop loss order under the market.

A perfect storm for stocks is brewing, and this week could potentially be one of the most chaotic that we have seen in a very long time.

But of course the Federal Reserve could decide to surprise us all by not raising rates, and that would change things substantially.

So what do you think will happen this week?

Credit to The Economic Collapse

Prominent Rabbis Hint that the Messiah is “Just Around the Corner”

This is Tom Horn View about it:
http://player.theplatform.com/p/IfSiAC/syuFChlhBYkq/select/media/ItHPm4p7jfoo

“But you, Daniel, shut up the words and seal the book, until the time of the end. Many shall run to and fro, and knowledge shall increase.” (Daniel 12:4)

image: http://www.breakingisraelnews.com/wp-content/uploads/2015/12/rabbis-moshe-sternbuch-shlomo-amar.jpg

Rabbi Moshe Sternbuch (L) and Rabbi Shlomo Moshe Amar (R) have both hinted that the world is in an auspicious time for the arrival of the messiah. (Photo: Breaking Israel News)

Two prominent rabbis in Israel – Rabbi Moshe Sternbuch and Rabbi Shlomo Moshe Amar – have hinted in public that the Messiah is “just around the corner” based upon certain world events taking place today. 

Rabbi Sternbuch, vice president of the Rabbinical Court and head of the Eidah Charedit organization in Jerusalem, recently said that people should “put on their Shabbat clothes in preparation for the Messiah.” 

As reported by the Hebrew language website Kikar Shabbat, Rabbi Sternbuch was giving over his regular weekly lesson when he began to relate the arrival of the Messiah to the recent conflict between Turkey and Russia. He concluded that in the context of this conflict, we should anticipate the Messiah.

“We have received a direct teaching, passed down from one to another, from the Gaon of Vilna, that when Russia goes and conquers Istanbul, the capital of Turkey, it is time to quickly put on your Shabbat clothes and expect the Messiah,” he said. 

“Here we have Russia and Turkey in a conflict with each other. We hear sounds of war. All of the nations seem so surprised that Turkey began a fight with Russia,” Rabbi Sternbuch explained. 

“But we see in this the realization of the teachings of the sages, that when the Messiah needs to come, God will incite nations against each other, until, against their will, there will be a war. Therefore, as the Shmittah goes out, we should have great inspiration to wake up and repent.”

Touching upon a teaching taught by the Jewish sages, Rabbi Sternbuch reflected on the persecution the Jews will face from the Arab nations as part of the messianic process. 

“It is also written that before the Messiah comes, Israel will suffer greatly from the sons of Ishmael (Arabs) and they will succeed in antagonizing us. We are at a crossroads and we need to pray to God to redeem us. We have to wake up and repent or, if not, God forbid, the Ishmaelites will overcome us.”

“This is precisely the time to repent and pray,” he said. “Messiah is just around the corner and is waiting to arrive. It is impossible to understand how a country like Turkey can start a war and refuse to apologize. They are crazy! God is confusing them, therefore we need to strengthen ourselves in repentance so we will merit a true redemption very soon.”

In a related report on Kikar Shabbat, Rabbi Amar, the Chief Sephardic Rabbi of Jerusalem and former Sephardic Chief Rabbi of Israel, was quoted as saying that the world is currently in the closest possible moment for the arrival of the Messiah. 

Speaking at an assembly of followers of the Hassidic Chabad movement in Kfar Chabad, Rabbi Amar said, “We are at the closest possible period to the Messiah. We have never been this close to the revelation of the Messiah before. All the signs given by the prophets, the early and later sages, and what is written in the Zohar (the basis of Kabbala), are in place for us.  All of the great men of the last generations, and at their head is my rabbi [Rabbi Ovadia Yosef], they said ‘Behold, he is standing just around the corner’. We just have to stay strong.”

Rabbi Amar quoted a teaching from the last Chabad leader, Rabbi Menachem Mendel Schneerson, in which he warned that the time before the messiah will intensify conflict around the world. “There will come a time when we won’t be able to sleep because of all the troubles that will befall us,” Rabbi Amar related.

CRedit to breaking israel news
Read more at http://www.breakingisraelnews.com/55777/turkeysyria-conflict-unfolding-prominent-rabbis-hint-messiah-around-corner-jewish-world/#poO4GqsrlOVaLFbv.99

Multiple Experts Predicting Imminent ISIS Attacks On American Soil

The above caption embodies how a growing number of Americans are now viewing this President, and for good reason.

I have never seen such a time when multiple, trusted sources are experiencing such a convergence of information regarding a massive amount of well-coordinated terrorist attacks upon the United States at the exact same time. However, I am experiencing this very thing at this very moment.

One caveat, do not expect aid and protection from this administration.

My Insider Sources

I was among the very first to report the real truth about the events related to Benghazi and the quality of my sources put me months ahead of the vast majority of the Independent Media. I am not bragging, I am emphasizing that these same sources of intelligence information are telling me, in unison, that the United States is facing a “TET Offensive” style of terrorist attacks inside of our country.

Readers may recall that in 1968, after the LBJ administration was repeatedly telling the American people that we were winning the Vietnam War, the Viet Cong attacked every single capital, in every single South Vietnamese province. Even the US embassy in Saigon was momentarily captured. This was the turning point of the Vietnam War.  My sources have compared what’s coming to the TET offensive. According to these deep-cover sources, gun-free zones will be targeted (e.g. athletic events, concerts, schools, malls and university campuses.

Of course this will lead to the imposition of martial law practices without a formal declaration of martial law. These policies will include gun confiscation, the execution of gun owners who do not surrender their guns following an executive decree. The policies also call for the enforcement of sanctions against people who are on various lists. No, not the No-Fly lists, but for people who are on the Red and the Blue Lists. These are the very same lists that Steve Quayle has been warning us about for years.

Both of my sources were hesitant to commit to a specific time frame except to say that Christmas opens up targets of opportunities that do not exist for the rest of the calendar.

Paul Martin

On multiple occasions, Paul Martin, of Revolutionradio.org has provided me with valuable intel from his deep cover source. Yesterday (December 12, 2015), Paul contacted me to tell me that another massive drill was just concluded by members of the “alphabet soup agencies” regarding a major terrorist event(s) on the East coast. This is the second such report in the past month.

It is time to move from confidential based sourced evidence, to the on-the-record sources.

Mainstream Media

Mainstream media outlets such as Fox, CNN, ABC, NBC and the New York Times have all stated pretty much the same thing. Syed Farook and his wife, Tashfeen Malik, executed 14 Americans in San Bernardino with guns provided for him by Enrique Marquez. Marquez has terrorist ties. He has terrorist ties to the Russians. It is becoming clear that the supplier of the guns to Farook, was being handled by the Russians. Stay tuned, this theme will be better developed later in this article.

The Beginning of the Creation of an Arsenal of IED’s to be Deployed Inside the US

Multiple Missouri LEO’s have notified the FBI about a large amount of cell phone purchases from area Walmarts. Adding fuel to the fire,  a large number of propane tanks have been reported stolen from several locations is Independence and Lee`s Summit.

According to terrorism expert, Denise Simon, this same pattern is prevalent in hotbeds of terrorism, not just in Missouri. At the end of November, a BP gas station in Lee`s Summit reported 20 propane tanks stolen from their outside cages. That same night the CVS on Southwest 3rd Street reported the exact same crime. Two weeks later, the CVS on East 23rd Street in Independence was hit, and 28 tanks were stolen from that location.

The FBI is investigating. The Obama administration is silent on any issue of this type except to say that they will not tolerate anyone criticizing Islam or Muslims in response to these terrorist threats being perpetrated by Muslim organizations.

From a trusted contact on Facebook, the following post appeared on 12/12/2015 at 1pm Pacific.

LikeComment

 Wendy Liberty Brooks Jones

55 mins ·   (1PM Pacific)

Heads up SoCal residents. A friend of mine went to the UPS store, the woman ahead of her was returning dozens of packages only keeping numerous cell phones she had ordered in that shipment. The clerk was angry and my friend overheard him say that the woman had done this several times before, returning everything but cell phones. My friend lives in a city located in San Bernardino County.

The Obama Administration Does NOT Protect and Defend the Constitution From All Enemies, Both Foreign and Domestic

The subtitle text is self-evident. In the aftermath of the mass murder of 14 Americans by an ISIS  terrorist and his terrorist wife, the Obama administration does not give a damn about the 14 dead Americans or the grief being experienced by the families. Instead they are worried about not offending Muslims.

Not a word about the 14 Americans that were executed by a Muslim terrorist from Loretta Lynch. But Lynch(mob) threatens to arrest anyone speaking out against Muslim extremism. I do not have words to describe how out of touch this administration is with the American people. Please note the backdrop when this violator of the First Amendment issued her threat against the American people. Do you see an American flag anywhere in the photo? If there is any doubt as to the loyalties and intentions of this administration, this photo and its surrounding context erases all doubt.

Any further questions? Does this erase any doubt about the loyalties of this administration?

Denise Simon, Terrorism Expert

The Denise Simon Experience. Denise Simon is a widely recognized terrorism expert who consults for and with several high profile clients.

On December 12, 2015, terrorism expert, Denise Simon, was interviewed on a pre-recorded interview on The Common Sense Show.  The entire interview will air Tuesday, December 15, 2015 on the following outlets:

50,000 Watt Superstation, WMQM AM 1600, Memphis, TN from 4-5pm EST. This will be simulcast on The Common Sense Show website.

Talknetwork.com on December 15 from 9-10pm EST.

Global Star Radio Network (4-5pm EST) on December 15, which broadcasts the show to North America and parts of Europe.

Denise Simon is one of the foremost experts on the subject of terrorism ever interviewed on The Common Sense Show. The following information is a very small cross-section of information which was contained in our interview. The following snippets will leave no doubt as to the extreme danger that American finds itself in.

-Simon linked Farook, the San Bernardino mass murderer to several terrorist entities.

-The supplier of the weapons in the San Bernardino shootings, Enrique Marquez, was married to a Russian. Ten thousand dollars was paid to facilitate this marriage. Marquez is broke, where did the money come from? The mother of Marquez told the media that her son never lived with the Russian. She was brought in under the K1 Visa (engagement) Visa program. (EDITOR’S NOTE: Based upon the original evidence, The Common Sense Show, based upon Simon’s evidence and other intel, has independently concluded that this Russian operative was clearly the handler for this operation. Do you understand what this means? However, this is not the first time we have seen the Russians in bed with ISIS on American soil. Please visit this link for a stunning example.) I asked Denise Simon if the Russians were involved in these Muslim extremist groups and she unhesitatingly stated “absolutely”. She went on to state the Russian military forces in Syria are not going after ISIS nearly as much as they are simply going after the anti-Assad forces being funded and supplied by the U.S.

-Through Simon’s website, Founderscodecom, she has revealed many concerning and stunning details regarding the immigration issue involving Muslims. In Greece, for example, Muslim refugees are printing their own VISAS. This provides carte-blanch entry into the United States or any country in Europe. She has written in detail about the various VISAS that are admitting unscreened and potentially dangerous Muslims into America. There is the extremist World Assembly of Muslim Youth, J1 cultural VISAS which

-Simon has written extensively on the types of VISAS being used to admit potentially extremist Muslims into the US. This was covered extensively in the interview.

-Although Simon stopped short of saying that multiple terrorist attacks are imminent, she did say that the Christmas season provides targets that are not available to terrorists at other times in the year.

I strongly recommend listening to the Simon interview in two days at one of the venues listed above. It is a riveting and frightening interview.

Doug Hagmann

I have had two intense conversations with Doug Hagmann about the present state of affairs with regard to terrorism. Doug has a confidential source that this telling him the following:

1. Multiple terror attacks this year will likely take place.
2. The attacks will resemble what I called the TET Offensive.
3. Martial law will not be declared but will be implemented if the Obama administration can subdue the military opposition to his administration. Do you remember when DHS obtained 2.1 billion rounds of ammunition a few years ago? Now we know why.

Tonight on December 13, 2015, Doug Hagmann will be appearing on The Common Sense Show, in the first hour at 8pm EST. The show can be listened to on Global Star Radio Network, or directly on The Common Sense Show. Both contacts for listening are listed earlier in this article.

It has always been safe to say that where there is smoke there is fire. However, these expert accounts go way beyond the smoke and speak clearly to the coming devastating events.

Credit to Common Sense

700,000 evacuated as Typhoon Melor reaches Philippines

MANILA, Dec. 14 (UPI) -- More than 700,000 people were evacuated in the Philippines on Monday as Typhoon Melor reached sustained winds up to 130 mph.

The fierce storm, known locally as Nona, is bearing down on coastal areas with heavy winds and rain. Melor intensified rapidly over the weekend as it moved toward the eastern island of Samar, CNN reported.

The Philippine archipelago is under the threat of torrential rainfall, particularly in the densely populated region around Manila, the capital. About 725,000 people have been pre-emptively evacuated, the Philippine national disaster management agency said.

About 40 domestic flights have been canceled and many schools have been closed.

Credit to UPI

UPI.com

Russia continues military buildup around Turkey

Reports suggest that 7,000 Russian soldiers to be stationed on the Armenia-Turkey border


World Bulletin / News Desk

Russian garrisons are being deployed near the Armenia's border with Turkey on the Armenian government's request, media reported Monday.

According to local media, the decree to send the troops to Armenia was already signed by Russian President Putin, and the deployment will start soon. 

Reports suggest that 7,000 soldiers from 58th Army Corps and will be stationed on the Armenia-Turkey border.

The Russian troops are expected to be equipped with missiles and tanks.

The Armenian government has supposedly asked Russia to deploy its troops to the Turkey border as it fears an armed attack on the country.

Credit to World bulletin

DEJA VU ALL OVER AGAIN

Janet Yellen will increase interest rates for the first time in nine years on Wednesday. She isn’t raising them because the economy is strengthening. The economy just happens to be weakening rapidly, as global recession takes hold. The stock market is 3% lower than it was in December 2014, and has basically done nothing since the end of QE3. Wall Street is throwing a hissy fit to try and stop Janet from boosting rates by an inconsequential .25%. Janet would prefer not to raise rates, but the credibility and reputation of her bubble blowing machine is at stake. The Fed has enriched their Wall Street benefactors over the last six years, while destroying the real economy and the middle class.

The quarter point increase will be reversed in short order as soon as we experience market collapse part two. It will be followed with negative interest rates and QE4, as these academics have only one play in their playbook – print money. They created the last financial crisis and have set the stage for the next – even bigger collapse. John Hussman explains how their zero interest rate policy has driven speculators into junk bonds as the only place to get any yield.

Over the past several years, yield-seeking investors, starved for any “pickup” in yield over Treasury securities, have piled into the junk debt and leveraged loan markets. Just as equity valuations have been driven to the second most extreme point in history (and the single most extreme point in history for the median stock, where valuations are well-beyond 2000 levels), risk premiums on speculative debt were compressed to razor-thin levels. By 2014, the spread between junk bond yields and Treasury yields had fallen to less than 2.4%. Since then, years of expected “risk-premiums” have been erased by capital losses, and defaults haven’t even spiked yet (they do so with a lag).

Years of excessive risk taking, spurred by the reckless Fed policy convinced Wall Street to issue billions in junk bonds, just as ridiculously low rates from 2001 through 2005 spurred billions of subprime mortgage issuance. Wall Street has no care about clients, investors, or the impact on the economy. They care about fee generation and dumping their toxic sludge on someone else. The junk bond market is imploding and any muppet who has been lured in during the last two years is getting slaughtered.



The entire shale scam was funded with easy money and junk bonds. The dozens of companies who issued billions in junk bonds weren’t profitable at $80 oil. They are plunging towards bankruptcy at $36 oil. The amount of mal-investment created by the Federal Reserve over the last six years is almost incomprehensible. The tremors in the junk bond market portend another Lehman moment in the near future.

From an economic standpoint, the unfortunate fact is that the proceeds from aggressive issuance of junk debt and leveraged loans in the past few years were channeled into speculation. Excess capacity in energy production was expanded at the cyclical peak in oil prices, and heavy stock buybacks were executed at obscene equity valuations. The end result will be unintended wealth transfers and deadweight losses for the economy. Since the late-1990’s, the Federal Reserve has actively encouraged the channeling of trillions of dollars of savings into speculation. Recurring cycles of malinvestment and crisis have progressively weakened the resilience and long-term growth prospects of the U.S. economy.

The coming collapse will be three pronged as stocks, bonds, and real estate are all simultaneously overvalued. Junk bonds are the canary in a coalmine. High end real estate in NYC has topped out. New and existing homes sales growth has stalled out. Retailers desperately slash prices to maintain sales, while destroying their profits. Corporate profits are falling. The stock market is teetering on the edge. If you can afford to lose 50% of your retirement savings, now is the time to buy some Facebook, Netflix, Google, or Amazon on margin.

Given the valuation extremes we presently observe in the equity market (see Rarefied Air: Valuations and Subsequent Market Returns), our view is that spiking yields in the junk debt market are a precursor of significant losses in stocks, as we’ve observed in other market cycles across history.

At current valuations, the notion that “There Is No Alternative” (TINA) to zero-interest cash is profoundly incorrect. The only thing that equities offer here is to promise wider extremes of panic, despair, excitement, and hope over the coming 10-12 years, on the way to overall returns no better than safe, liquid cash equivalents are likely to achieve.

Over the last two decades the Fed’s interventionism has created artificial booms and real busts. Their dreadful mistakes are “fixed” by currency debasement, lower interest rates, and money printing – creating even worse mistakes. They have successfully gutted the American economy and left a hollowed out shell.

Moreover, as we should have learned from the global financial crisis, when the Fed holds interest rates down for so long that investors begin reaching for yield by speculating in the financial markets and making low-quality loans, the entire financial system becomes dangerously prone to future crises. If the Fed’s mandate is really to support long-run employment and price stability, the first priority of Congress should be to rein in this cycle of activist Fed intervention; to end the Fed’s ability to promote yield-seeking speculation and malinvestment that only produces inevitable crises and weakens long-run U.S. economic prospects.

Bernanke is no hero. He did not save us. He saved his cronies on Wall Street and their captured politician lackeys in Washington DC. The unholy alliance between central bankers, corporate America, and corrupt politicians resulted in Glass Steagall being repealed and allowing Wall Street to run roughshod over our economic system, reaping riches during the good times and heaping the inevitable losses onto the backs of taxpayers. That’s the new American Dream.

Some would argue that the Federal Reserve “saved” us from the global financial crisis. I couldn’t disagree more. My view is that the financial crisis was caused because the Fed overly depressed interest rates in the early 2000’s, encouraging investors to reach for yield in mortgage securities. In response, poorly regulated financial institutions, with banks free from the constraints of Glass Steagall, and other institutions having inadequate capital requirements, created a huge mountain of new, low-grade mortgages in the frenzy to create more “product.” The easy lending created a housing bubble, but someone had to hold the mortgages when they went belly-up, and those holders were banks, insurance companies, hedge funds, and individuals. As the mortgages went into foreclosure, banks had to mark the value of those mortgages to market value on their books, to the point where the value of their assets was less than the value of their liabilities: insolvency.

The liquidation of insolvent criminal Wall Street banks would have set the country back on the path to legitimate recovery. Instead, the ruling class chose accounting fraud, QE to infinity, and screwing senior citizens with 0% interest rates.

In hindsight, the financial crisis actually ended – precisely – in March 2009. How? The Financial Accounting Standards Board changed rule FAS 157 and overturned the mark-to-market requirement, instead allowing financial institutions “significant judgment” in the way they valued their assets: often called mark-to-model (or as some of us call it, mark-to-unicorn).

John Hussman warned those who chose to listen in 2000 and 2007 about the impending collapses. He has been warning those who choose to listen for months again. This market has gone nowhere in the last 13 months. It’s about to go somewhere, and that is DOWN. Remember 2000 and 2007. Enjoy the trip – deja vu all over again.

Credit to the burning platform

http://www.theburningplatform.com/2015/12/13/deja-vu-all-over-again-2/