Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-61499 Tue, 17 Jan 2017 02:05:56 GMT Peak Savings: Wall Street Faces 20 Years Of Retirement Withdrawals As Boomers Hit 70 1/2 http://implode-explode.com/viewnews/2017-01-16_PeakSavingsWallStreetFaces20YearsOfRetirementWithdrawalsAsBoomer.html America's aging population [will be] forced by IRS regulations to take retirement withdrawals once they hit 70 1/2 years of age... over the past 2 decades Americans have consistently contributed more than they've withdrawn from tax deferred accounts, excluding recessionary periods. But that all changed in 2013 and 2014 as the first wave of Boomers hit the magical age of 70.5 with a total of $25 billion of net withdrawals in 2014 alone.

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In aggregate, per the Wall Street Journal, Boomers have saved $10 trillion in various tax-deferred saving accounts. While that sounds like an impressive figure, with 75 million Boomers, it equates to an average of $133,000 per person which, needless to say, is insufficient to fund ~20 years of retirement.

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iehi-feed-61498 Tue, 17 Jan 2017 01:59:07 GMT Davos elite faces evaporating trust of populace http://implode-explode.com/viewnews/2017-01-16_Davoselitefacesevaporatingtrustofpopulace.html Trust in governments, companies and the media plunged last year as ballots from the United States to Britain to the Philippines rocked political establishments and scandals hit business.

The majority of people now believe the economic and political system is failing them, according to the annual Edelman Trust Barometer, released on Monday ahead of the Jan. 17-20 World Economic Forum (WEF).

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"The most shocking statistic of this whole study is that half the people who are high-income, college-educated and well-informed also believe the system doesn't work."

We're not sure what's "post-truth" about no longer having trust in elites; so we just went ahead and cropped that from the headline.

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iehi-feed-61497 Tue, 17 Jan 2017 01:57:30 GMT Despite Electoral Win, Trump Lacks Popular Mandate on Key Policy Planks, Including Health and Taxes http://implode-explode.com/viewnews/2017-01-16_DespiteElectoralWinTrumpLacksPopularMandateonKeyPolicyPlanksIncl.html On other issues, a similar story presents itself. Public Policy Polling (PPP) has found that the vast majority (88 percent) of voters in Florida, Nevada, Ohio, Pennsylvania and Wisconsin -- four crucial swing states, three of which went to Trump this fall -- oppose cutting Social Security benefits, while a majority (68 percent) oppose privatizing Social Security. Similarly, 67 percent of Americans support requiring high-income earners to pay the payroll tax for all of their income (the cap is currently $118,500), according to a Gallup poll. America's two other major social programs, Medicare and Medicaid, are also widely supported by Americans, and the vast majority oppose any spending cuts to either. In fact, more Americans support cutting the national defense budget than Medicare or Medicaid.

It goes on and on. A majority of Americans, 61 percent, believe that upper-income earners pay too little in taxes. A majority of 64 percent believe that corporations don't pay their fair share in taxes. Significant majorities believe that wealth distribution is unfair in America, support raising the minimum wage (though perhaps not as high as Sanders would like), and say they are worried about climate change.

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iehi-feed-61493 Mon, 16 Jan 2017 16:14:12 GMT Trump Slams NATO, Floats Russia Nuke Deal in European Interview http://implode-explode.com/viewnews/2017-01-16_TrumpSlamsNATOFloatsRussiaNukeDealinEuropeanInterview.html Donald Trump called NATO obsolete, predicted that other European Union members would follow the U.K. in leaving the bloc, and threatened BMW with import duties over a planned plant in Mexico, according to two European newspapers which conducted a joint interview with the president-elect.

Trump, in an hourlong discussion with Germany's Bild and the Times of London published on Sunday, signaled a major shift in trans-Atlantic relations, including an interest in lifting U.S. sanctions on Russia as part of a nuclear weapons reduction deal.

Quoted in German by Bild from a conversation held in English, Trump predicted that Britain's exit from the EU will be a success and portrayed the EU as an instrument of German domination designed with the purpose of beating the U.S. in international trade. For that reason, Trump said, he's fairly indifferent to whether the EU stays together, according to Bild.

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iehi-feed-61491 Sun, 15 Jan 2017 17:57:43 GMT Trump/Congressional Proposed Tax Changes and How to Benefit from Them http://implode-explode.com/viewnews/2017-01-15_TrumpCongressionalProposedTaxChangesandHowtoBenefitfromThem.html iehi-feed-61490 Sun, 15 Jan 2017 15:06:55 GMT The President Who Wasn't There: Barack Obama's Legacy of Impotence http://implode-explode.com/viewnews/2017-01-15_ThePresidentWhoWasntThereBarackObamasLegacyofImpotence.html Obama assumed the presidency at a moment when much of the nation seemed ready to confront the unwelcome fact that the American project had derailed.... Corporate capitalism just wasn't delivering the goods anymore. Not for the bottom 80 percent, any way. The economy was in ruins, mired in what appeared to be a permanent recession. The manufacturing sector had been killed from the inside-out, with millions of well-paying jobs outsourced and nothing but dreary service-sector positions to take their place. Chronic long-term unemployment hovered at more than 10 percent, worse, much worse, in black America. Those who clung to their jobs had seen their wages stagnate, their home values shrivel and were suffocating under merciless mounds of debt. Meanwhile, capital moved in ever-tightening circles among a new odious breed of super-rich, making sweat-free billions from the facile movement of money.

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With his sunny disposition and Prospero-like aptitude for mystification, Obama should have been able to convert [the discontented] or, at least, to roll over them. Instead, they kicked his ass. How? ... Obama's most grievous political wounds were self-inflicted, starting even before his election when he rushed back to Washington to help rescue Bush's Wall Street bailout. This was perhaps the first real indication that the luminous campaign speeches about generational and systemic change masked the servile psyche of a man who was desperately yearning to be embraced by the nation's political and financial elites.

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iehi-feed-61488 Sun, 15 Jan 2017 02:36:53 GMT American Apparel Could Be A Puzzler For Trump: Can He Coerce a Bankrupt Company Bought And Moved Overseas By Foreigners? http://implode-explode.com/viewnews/2017-01-14_AmericanApparelCouldBeAPuzzlerForTrumpCanHeCoerceaBankruptCompan.html Gildan's purchase agreement covers American Apparel's assets, including most of its manufacturing and distribution equipment. Gildan bought American Apparel's existing inventory in a separate deal. But the company has declined the option to assume the leases of two Los Angeles manufacturing facilities that employ nearly 1,300 factory workers.

Gildan also declined the lease on American Apparel's headquarters, which employs nearly 2,200 people. The downtown offices will continue to manage the company's retail operations and website, but in December American Apparel warned all its Los Angeles-area employees that they may lose their jobs. Though the company might retain some operations in the United States, analysts expressed skepticism to the Los Angeles Times that any of American Apparel's current U.S. manufacturing workers would keep their jobs, speculating that Gildan would likely move factory work to its existing facilities in Honduras and the Dominican Republic.

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iehi-feed-61487 Sun, 15 Jan 2017 00:42:05 GMT Why DeLong, Summers, Bernanke, Krugman, Keen, Pettis, Edwards et al. Can't Figure Out "Secular Stagnation" http://implode-explode.com/viewnews/2017-01-14_WhyDeLongSummersBernankeKrugmanKeenPettisEdwardsetalCantFigureOu.html iehi-feed-61485 Sat, 14 Jan 2017 15:22:08 GMT GOP's Go Slow 'Rescue Mission' Plan To Replace Obamacare http://implode-explode.com/viewnews/2017-01-14_GOPsGoSlowRescueMissionPlanToReplaceObamacare.html As their first major act of the new Congress, Republicans rushed approval of a budget resolution this week that sets up a framework for repealing Obamacare, but what exactly to replace it with is still a puzzle Republicans are piecing together. And it could take a while.

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Ryan says Republicans will use their annual GOP retreat for a "full, exhausting" conversation on how exactly to repeal and replace the law. The go-slow approach is at odds with the increasing urgency of the rhetoric on the state of the Affordable Care Act.

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The incoming president said they will not offer a plan until his nominee for Health and Human Services secretary, Rep. Tom Price, R-Ga., is confirmed. Republicans expect a significant amount of the repeal effort to come through executive action by HHS since much of the implementation of Obamacare was done through the same agency.

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iehi-feed-61484 Sat, 14 Jan 2017 15:05:25 GMT Are Investors bracing for a massive stock-market selloff? http://implode-explode.com/viewnews/2017-01-14_AreInvestorsbracingforamassivestockmarketselloff.html Demand for one-month call options tied to the CBOE Volatility Index, a popular gauge of stock-market volatility, has spiked in the past week, a sign that some are bracing for a sharp downturn following the inauguration of President-elect Donald Trump.

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Since the beginning of the year, stock-market volatility has been relatively subdued despite increasing uncertainty surrounding the future direction of fiscal and monetary policy in the U.S. The Daily Shot, a popular market newsletter, illustrates this divergence in the chart below.

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iehi-feed-61483 Sat, 14 Jan 2017 15:03:20 GMT Addicted To Gov? Ben Carson And The 30 Year Mortgage Backstop http://implode-explode.com/viewnews/2017-01-14_AddictedToGovBenCarsonAndThe30YearMortgageBackstop.html iehi-feed-61482 Sat, 14 Jan 2017 03:24:58 GMT Carson will "Examine" FHA Premium Cut http://implode-explode.com/viewnews/2017-01-13_CarsonwillExamineFHAPremiumCut.html iehi-feed-61480 Fri, 13 Jan 2017 19:41:52 GMT JPMorgan, BofA make out like a bandits on post-Trump market surge http://implode-explode.com/viewnews/2017-01-13_JPMorganBofAmakeoutlikeabanditsonpostTrumpmarketsurge.html JPMorgan Chase & Co reported a 24 percent rise in fourth-quarter profits on Friday, beating analyst expectations, as its Wall Street business benefited from a surge in trading activity following the U.S. election... [ex-tax adjustments] the bank earned $1.58 per share, well above the average analyst estimate of $1.44 per share...

Revenue from fixed-income trading -- JPMorgan's most volatile business -- rose 31 percent to $3.4 billion, while stock trading revenue increased 8 percent to $1.2 billion. Bank of America Corp (BAC.N), which reported results earlier on Friday, also said trading revenue surged last quarter.

Here's a piece on BofA, to the same effect.

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iehi-feed-61478 Fri, 13 Jan 2017 17:33:07 GMT Core Retail Sales Growth Weakest In Almost 3 Years (CONTRADICTING NRF'S RAH-RAH REPORT) http://implode-explode.com/viewnews/2017-01-13_CoreRetailSalesGrowthWeakestInAlmost3YearsCONTRADICTINGNRFSRAHRA.html Earlier this week Bank of America warned that December retail sales could come in weaker than expected, when it looked at its internal credit and debt card spending data and found a 1.0% drop. Moments ago the official data released from the Dept of Commerce confirmed that once again BofA was right, when it announced that in December, US retail spending rose 0.6%, below the expected 0.7%, however much of this was thanks to spending on cars and gas. If one excludes autos, the rise was only 0.2%, below the 0.5% expected, and if one also excludes gas, there was no increase in spending in December whatsoever.

Meanwhile, the National Retail Federation is in full-on party-hats mode, trumpeting Holiday Sales Outpace Forecast Despite Department-Store Woes. We have a guess at what the true reality is...

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iehi-feed-61477 Fri, 13 Jan 2017 17:27:38 GMT US wholesale prices rise 0.3 pct., led by costlier gas, food http://implode-explode.com/viewnews/2017-01-13_USwholesalepricesrise03pctledbycostliergasfood.html December's gain was led by a big climb in wholesale gas prices, which rose 7.8 percent. Food prices increased 0.7 percent, with chicken eggs, a volatile category, jumping 69.3 percent. Fresh fruits and melons, which soared last month, declined by the most in more than six years.

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Consumers have seen higher prices in housing and health care in recent months. That's pushed up core consumer prices, which exclude food and energy, by 2.1 percent in the past year.

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iehi-feed-61476 Fri, 13 Jan 2017 16:51:16 GMT Millennials are falling behind their boomer parents http://implode-explode.com/viewnews/2017-01-13_Millennialsarefallingbehindtheirboomerparents.html With a median household income of $40,581, millennials earn 20 percent less than boomers did at the same stage of life, despite being better educated, according to a new analysis of Federal Reserve data by the advocacy group Young Invincibles.

The analysis being released Friday gives concrete details about a troubling generational divide that helps to explain much of the anxiety that defined the 2016 election. Millennials have half the net worth of boomers. Their home ownership rate is lower, while their student debt is drastically higher.

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The declining fortunes of millennials could impact boomers who are retired or on the cusp of retirement. Payroll taxes from millennials helps to finance the Social Security and Medicare benefits that many boomers receive -- programs that Trump has said won't be subject to spending cuts. And those same boomers will need younger generations to buy their homes and invest in the financial markets to protect their own savings.

But... but... but... but... isn't the answer to all economic problems "more education"?? Seriously, though -- this issue of millennials not socking-away enough to continue to float social security and the financial markets is a HUGE (yooge?), un-appreciated one...

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iehi-feed-61475 Fri, 13 Jan 2017 16:42:22 GMT Wells Fargo profit falls after sales scandal http://implode-explode.com/viewnews/2017-01-13_WellsFargoprofitfallsaftersalesscandal.html Wells Fargo & Co. reported a decline in fourth-quarter profit as moves in interest rates, a falloff in mortgage revenue and the bank's recent sales-tactics scandal weighed on the nation's third-largest bank.

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Since the scandal, new retail banking business such as customer checking account openings and credit card applications have fallen dramatically, including a drop of 40% and 43%, respectively, in December from a year ago.

Overall profits at Wells Fargo's community banking division, which includes the unit responsible for the questionable sales tactics, were $2.73 billion, a 15% decrease from the $3.3 billion it earned in the fourth quarter of 2015.

The scandal has boosted expenses, which are likely to remain high for some time. Wells Fargo CEO Timothy Sloan has said the bank expects to spend tens of millions of dollars to get through investigations and other regulatory matters related to its sales-practices scandal. Wells faces a spate of state and federal investigations, including by the Justice Department and the Securities and Exchange Commission.

Making matters worse, the higher costs come as interest rates remain at relatively low levels, despite a recent uptick. The result of this combination: Wells Fargo's return on equity continues to grind lower in the fourth quarter, at 10.94%, its lowest level in years.

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iehi-feed-61474 Fri, 13 Jan 2017 16:36:50 GMT Germany's Wolfgang Schaeuble urges ECB to start unwinding stimulus this year http://implode-explode.com/viewnews/2017-01-13_GermanysWolfgangSchaeubleurgesECBtostartunwindingstimulusthisyea.html The European Central Bank should start unwinding its ultra-loose monetary policy this year, German Finance Minister Wolfgang Schaeuble said in an interview to be published on Friday, adding that it would not be easy.

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He said forecasts that inflation could reach 3 percent in Germany this year would exacerbate concerns about current low interest rates.

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The conservative minister said it would take a great effort to convince German citizens that the common currency provided more employment, social and business benefits than risks and negative consequences.

To help Germany make the argument, he said it was essential that Italy and other countries stuck to the agreed rules.

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iehi-feed-61473 Fri, 13 Jan 2017 16:35:17 GMT Edwards: ‘Waste of time' to save Italian bank; Get Italy Out of Euro http://implode-explode.com/viewnews/2017-01-13_EdwardsWasteoftimetosaveItalianbankGetItalyOutofEuro.html iehi-feed-61472 Fri, 13 Jan 2017 16:30:55 GMT Mitchell Feierstein: Abolish central banks and slay the zombies http://implode-explode.com/viewnews/2017-01-13_MitchellFeiersteinAbolishcentralbanksandslaythezombies.html It's different this time -- or is it? The US Federal Reserve, the Bank of England and the European Central Bank have become gargantuan, out-of-control, rogue hedge funds. Global central banks have magicked up hundreds of trillions of dollars in debt and guarantees. Worldwide stock-market valuations are stratospheric -- buoyed by share buybacks, funded by record corporate debt and enabled by reckless central bank zero-interest-rate policies. The European Central Bank's purchase of massive amounts of corporate debt is pouring petrol on this blaze.

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As far as I'm concerned, Carney and former chancellor George Osborne used the levers of monetary policy to distort market-pricing mechanisms and normal price signals. As a result, insurance companies and pension-fund portfolios were loaded to the gills with "risky assets" that will bankrupt them when -- not if -- markets normalise.

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All of this has resulted in a UK commercial and residential property bubble that is ready to explode. In Chelsea and Kensington, property transaction volumes have plummeted. Prices collapsed nearly 15% in November as property agents quietly close shop and sack employees across London. 

Have the Bank-enabled grotesque bubbles in the bond, stock and property markets or the eight years of "temporary emergency measures" and zero-interest-rate policies created infrastructure investment? Job creation? Savings? No, no and no.

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JPMorgan, Deutsche and Nomura made a fortune -- and Monte's shareholders and depositors, and EU taxpayers, will get slammed with the massive bailout tab. The new normal is apparently a world of financial fraud where the only rules which apply are too big to fail, bail or jail and too connected to prosecute --steal all you can, while you can, with impunity.

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Capitalism without bankruptcy is like Catholicism without hell. And right now, we need to audit and abolish the Fed, the Bank and the ECB, which started this mess, and slay the zombies.

Desperate times call for desperate measures; we must create a "new global banking paradigm" -- pivoting far away from the West's broken models, which rely on the same PhD economists, academics and government bureaucrats who have destroyed our global financial system and capitalism, replacing it with a combination of Keynesian economic Kool-Aid and central bank "new normal" Marxism.

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