Implode-Explode Heavy Industries news feed http://implode-explode.com/ Tracking the many faces of the global credit implosion. en-us iehi-feed-58946 Tue, 09 Feb 2016 14:42:41 GMT We Are Watching The Financial Collapse! http://implode-explode.com/viewnews/2016-02-09_WeAreWatchingTheFinancialCollapse.html iehi-feed-58942 Mon, 08 Feb 2016 17:21:48 GMT Wall St. in selloff mode as techs extend rout, oil falls http://implode-explode.com/viewnews/2016-02-08_WallStinselloffmodeastechsextendroutoilfalls.html iehi-feed-58937 Sun, 07 Feb 2016 21:19:02 GMT Debt, defaults, and devaluations: why this market crash is like nothing we've seen before http://implode-explode.com/viewnews/2016-02-07_Debtdefaultsanddevaluationswhythismarketcrashislikenothingwevese.html For many market watchers, a confluence of factors - led by oil, but encompassing China, the emerging world, and financial markets - are all brewing to create a perfect storm in a global economy that has barely come to terms with the Great Recession... Unlike previous pre-recessionary eras, the current sell-off has seen commodity prices, equities and credit conditions all move in dangerous lockstep.

... a tipping point may well be approaching. According to [Oliver] Blanchard's calculations, a 20pc decline in stock markets that persists for more than six months, will translate into a decline in consumption of between 0.5pc to 1.0pc.

...

Spreads on high yield US energy corporates have soared to unprecedented highs. "They make Lehman look like a walk in the park" says Thygesen.

More than a third of the entire US high yield bond index is now vulnerable to crude prices remaining low or falling even further, according to calculations from Oxford Economics.

...

The question exercising the minds of economists and investors is the extent to which this contagion could metastasize beyond the energy sector, as banks cut off credit access, loans turn bad, and financial conditions enter a critical tightening phase.

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Over the last 45 years, the S&P500 has suffered a loss of more than 12.5pc on 13 occasions. Six of these have given way to a recession in the US, providing a near 50pc probability that a global downturn is just around the corner.

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What, if anything, could halt this pernicious cycle of events from unfolding?

In the short-term, analysts are unanimous: all eyes are on the US Federal Reserve. The central bank's first rate hike in seven years last December has come to look frighteningly premature in the space of just eight weeks.

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iehi-feed-58935 Sun, 07 Feb 2016 21:11:18 GMT Risk of GLOBAL WAR as Saudi Arabia, Turkey -- and Ukraine -- enter Syria chaos http://implode-explode.com/viewnews/2016-02-07_RiskofGLOBALWARasSaudiArabiaTurkeyandUkraineenterSyriachaos.html iehi-feed-58933 Sun, 07 Feb 2016 21:01:47 GMT $100 Trillion Up in Smoke http://implode-explode.com/viewnews/2016-02-07_100TrillionUpinSmoke.html iehi-feed-58926 Sat, 06 Feb 2016 13:09:12 GMT Iran Dumps Dollar in Foreign Oil Sales / Sputnik International http://implode-explode.com/viewnews/2016-02-06_IranDumpsDollarinForeignOilSalesSputnikInternational.html iehi-feed-58924 Sat, 06 Feb 2016 12:20:26 GMT Oil Rout Threatens Vicious Cycle for Economy http://implode-explode.com/viewnews/2016-02-06_OilRoutThreatensViciousCycleforEconomy.html Rising debt costs for oil and gas companies last month pushed a ratio of corporate distress maintained by Standard & Poor's to its highest level since July 2009, when the last recession ended.

If a lending slowdown "were to broaden out beyond just energy and mining, that would be a concern," Mr. Rosenberg said...

Economic gauges already indicate an industrial recession. The Federal Reserve reported this month that its index of industrial production had fallen 1.8% over the year ended December, a drop that has always been accompanied by a recession since the 1970s.

Even though the U.S. economy has grown far more focused on providing services than producing goods, it is more exposed to commodity-price declines because "a lot of the services conducted in our economy are done in support of produced materials," said Mr. Alpert. Ultimately, deflation in the goods sector could squeeze service providers, too.

... others worry shifts in the global economy have made the U.S. is less insulated today, which means models from the Fed and others may overemphasize domestic activity and inadequately capture cross-border spillovers.

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iehi-feed-58908 Thu, 04 Feb 2016 17:22:54 GMT Oil Spikes Near $33 After Turkey-To-Invade-Syria Rumor http://implode-explode.com/viewnews/2016-02-04_OilSpikesNear33AfterTurkeyToInvadeSyriaRumor.html iehi-feed-58904 Thu, 04 Feb 2016 14:02:21 GMT Oil bears closing of $600 million triple-short fund bet seen adding to tumult http://implode-explode.com/viewnews/2016-02-04_Oilbearsclosingof600milliontripleshortfundbetseenaddingtotumult.html "Speculators are getting out of the down oil market. People start unwinding these positions because they think they have gotten their juice out of it," David Nadig, vice president, director of exchange traded funds for FactSet, said.

...

The net asset value of the fund - one of a handful of exchange funds that allows investors to trade oil without the complexity of a futures exchange - fell from close to $1 billion to $417 million on Tuesday and to $322 million on Wednesday, according VelocityShares' website.

As a result, the mass exodus likely forced the ETN's issuer, Credit Suisse, to quickly buy back short positions as investors redeemed shares.''

But the long-term damage is done as Shell to lay of 10,000.

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iehi-feed-58898 Thu, 04 Feb 2016 00:55:15 GMT Rockefellers Play With Fire: The Oil Scheme is Getting More Dangerous http://implode-explode.com/viewnews/2016-02-03_RockefellersPlayWithFireTheOilSchemeisGettingMoreDangerous.html iehi-feed-58896 Thu, 04 Feb 2016 00:33:51 GMT Goodbye Petrodollar: Russia Accepts Yuan, Is Now China's Biggest Oil Partner http://implode-explode.com/viewnews/2016-02-03_GoodbyePetrodollarRussiaAcceptsYuanIsNowChinasBiggestOilPartner.html iehi-feed-58880 Mon, 01 Feb 2016 20:17:32 GMT Oil price crash: Saudis told to embrace austerity as debt defaults loom http://implode-explode.com/viewnews/2016-02-01_OilpricecrashSaudistoldtoembraceausterityasdebtdefaultsloom.html The Saudis have been burning through their reserves at a record pace to protect the riyal's fixed value against a soaring dollar, and should continue to preserve the peg at all costs, said the IMF... any moves to jettison a stable currency, or embark on massive fiscal austerity, could erode the social fabric of the Gulf oil producing nations five years on from the Arab Spring.

Saudi Arabia is set to slash subsidies on water and electricity, and must begin to overhaul its generous fuel subsidies for its 30 million people, recommended the Fund.

...

IMF calculations suggests Saudi Arabia could be running a deficit of around $140bn (£94bn), far above the government's own estimates of around $98bn, or 15pc of GDP.

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iehi-feed-58875 Mon, 01 Feb 2016 15:30:44 GMT France to pave 1000km of roads with solar panels http://implode-explode.com/viewnews/2016-02-01_Francetopave1000kmofroadswithsolarpanels.html iehi-feed-58863 Sun, 31 Jan 2016 15:36:25 GMT ANOTHER NAIL IN THE U.S. EMPIRE COFFIN: Collapse Of Shale Gas Production Has Begun http://implode-explode.com/viewnews/2016-01-31_ANOTHERNAILINTHEUSEMPIRECOFFINCollapseOfShaleGasProductionHasBeg.html iehi-feed-58820 Tue, 26 Jan 2016 17:45:51 GMT So Yes, the Oil Crash Looks a Lot Like Subprime http://implode-explode.com/viewnews/2016-01-26_SoYestheOilCrashLooksaLotLikeSubprime.html iehi-feed-58809 Mon, 25 Jan 2016 20:59:49 GMT Oil selloff resumes as record Iraq supply adds to glut http://implode-explode.com/viewnews/2016-01-25_OilselloffresumesasrecordIraqsupplyaddstoglut.html iehi-feed-58802 Sun, 24 Jan 2016 15:19:55 GMT Oil company defaults are spiking http://implode-explode.com/viewnews/2016-01-24_Oilcompanydefaultsarespiking.html iehi-feed-58800 Sun, 24 Jan 2016 15:06:09 GMT Oil Plunge Imperils Iraq's Fight With Islamic State http://implode-explode.com/viewnews/2016-01-24_OilPlungeImperilsIraqsFightWithIslamicState.html iehi-feed-58796 Sat, 23 Jan 2016 19:29:23 GMT Moody's Just Put Over Half A Trillion Dollars In Energy Debt On Downgrade Review http://implode-explode.com/viewnews/2016-01-23_MoodysJustPutOverHalfATrillionDollarsInEnergyDebtOnDowngradeRevi.html iehi-feed-58790 Sat, 23 Jan 2016 18:47:07 GMT Doug Noland - Draghi Ready to Fight (BUT CAN HE DELIVER?) http://implode-explode.com/viewnews/2016-01-23_DougNolandDraghiReadytoFightBUTCANHEDELIVER.html The markets will now have six-weeks to ponder whether Draghi can deliver. Even assuming that he successful drags ECB hawks along, it's not easy to envisage how an additional $10 billion or so of QE will have much impact on (bursting) global Bubble Dynamics. An emphatic Draghi was, however, certainly capable of reversing global risk markets that were increasingly positioned/hedged for bearish outcomes. Over the years we've witnessed powerful short squeezes take on lives of their own, repeatedly giving the global Bubble an extended lease on life. And while bear market rallies tend to be the most spectacular, at this point I expect nothing beyond fleeting effects on the unfolding global Bubble unwind. Draghi is a seasoned pro at punishing speculators betting against Europe.

... I am these days more fearful than ever that this period has indeed been the terminal phase of decades of serial Bubbles... Today's predicament is becoming increasingly apparent: as the current global Bubble deflates and risk aversion takes hold, there is both a lack of sources of reflationary Credit and insufficient economic growth potential necessary to inflate an even bigger reflationary global Bubble. With confidence in central banking waning and the monstrous Chinese Bubble faltering, there is confirmation in the thesis that a most prolonged period of inflationary financial Bubbles is drawing to a close.

... The issue today goes much beyond a stock market correction, a bear market or even global financial crisis. Contemporary central banking has failed. Theories have failed. Doctrine has failed. The inability to spur self-sustaining economic recovery has been a major issue. Yet, from my perspective, the critical failure has been the incapacity to generate general price inflation. The delusion has been that central bankers would always enjoy the capacity to inflate away excessive debt. Bubbles needn't be feared, not with central banks "mopping" up with reflationary monetary stimulus. And for quite a while it seemed that "enlightened" contemporary inflationist doctrine had it all figured out.

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