Fears Grow of Repeat of 2008 Financial Crash as Investors Run for Cover

THE GUARDIAN: As leaders gathered in Davos, FTSE 100 was gripped by panic selling and entered bear market with Dow Jones also plunging

Fears that the global economy could be heading for a repeat of the 2008 financial crash have sent shockwaves through financial markets – prompting a rush to safe havens by investors.

Oil prices fell to a fresh 12-year low on Wednesday and metal prices tumbled in response to warnings that China’s slowdown could derail the global recovery at a time when central banks, which came to the rescue in the credit crunch, have only limited firepower.

As world and business leaders gathered for the annual World Economic Forum in Davos, Switzerland, the FTSE 100 was gripped by panic selling, especially of mining and oil companies that have been hit hard by the global slowdown in manufacturing and trade. Earlier this week China recorded the slowest rate of economic growth for 25 years. » | Phillip Inman, economics correspondent | Wednesday, January 20, 2016

Inside Story: Rich and Poor: Will the Inequality Gap Ever Be Bridged?

Charity group Oxfam warns of global crisis, with the 62 richest billionaires owning as much wealth as half the world.

62 World’s Richest People Own Same Wealth as Half the World – Report

The gap between rich and poor is widening according to the charity Oxfam, which reports that the 62 world’s richest people own the same as the poorest half of the planet's population.

Juncker zu Grenzkontrollen: "Ohne Reisefreiheit ist der Euro sinnlos"

SPIEGEL ONLINE: Reisende in der EU müssen immer häufiger ihre Pässe vorzeigen - die Kontrollen an den Grenzen kehren zurück. Jetzt stemmt sich EU-Kommissionspräsident Juncker dagegen: "Wer Schengen killt, wird den Binnenmarkt zu Grabe tragen."

Noch immer versuchen Tausende Flüchtlinge am Tag, die Europäische Union zu erreichen. Deshalb haben eine Reihe von EU-Staaten an ihren Grenzen wieder Kontrollen eingeführt - die im Schengenraum eigentlich nur in Ausnahmefällen und für kurze Zeit vorgesehen sind. EU-Kommissionspräsident Jean-Claude Juncker hat nun vor den Folgen für den Euroraum gewarnt. "Ohne Reisefreiheit ist der Euro sinnlos", sagte er am Freitag in Brüssel. » | vek/Reuters/AFP | Freitag, 15. Januar 2016

Financial Storm Coming: “Sunny Ways” Won’t Stop Global Economic Forces

Obama's Final State of the Union: "He's Calling Americans Liars"

Ezra Levant and Breitbart's Joel Pollak fact check Obama's last State of the Union speech, particularly the President's remarks about the economy. "Obama is basically calling more than half of the American people liars," Pollak notes.

'China to Spark Global Financial Ice Age with Depression Sending Markets Crashing by 75%'

EXPRESS: CHINA is set to plunge the world into an economic crisis sending stock markets crashing by 75 per cent - with devastating consequences for Britain, a leading city expert has warned.

The sinking value of the Chinese currency is already crippling British industry as it can’t compete with China’s cheap exports.

Other Western nations are also feeling the strain.

And with even more to come experts have predicted an 'ice age' for the world’s economies – including Britain’s.

Global deflation is going to wipe around 75 per cent in value off the American S&P stock market, as western firms will be unable to compete with cheap Chinese exports, according to analyst Albert Edwards from french bank Societe Generale.

He gave the stark warning in an investment note to clients.

And he blamed the upcoming 'carnage' on American central bank (the Fed) and its British and European counterparts for inflating prices in the first place.

American Quantitative Easing (QE) - injecting extra money into the financial system - has push up global asset prices, teeing up a disastrous fall, Mr Edward believes.

He said: "Investors are coming to terms with what a Chinese renminbi devaluation means for Western markets.

"It means global deflation and recession. » | Lana Clements | Thursday, January 14, 2016

Powerball Jackpot Soars – Yet Again

CBS NEWS: DES MOINES, Iowa – The world's largest lottery jackpot has grown to $1.5 billion because of continuing strong Powerball ticket sales.

Lottery officials increased their estimate of the huge jackpot for the second day in a row Tuesday because of immense interest in the prize.

The record-breaking Powerball jackpot could grow yet more before Wednesday's drawing if ticket sales continue to exceed expectations. Officials reassess the jackpot estimate daily. » | Tuesday, January 12, 2016

Sell Everything ahead of Stock Market Crash, Say RBS Economists

THE GUARDIAN: Royal Bank of Scotland warns of ‘cataclysmic’ year with slumps in shares and oil and advises clients to shift to bonds

Investors face a “cataclysmic year” where stock markets could fall by up to 20% and oil could slump to $16 a barrel, economists at the Royal Bank of Scotland have warned.

In a note to its clients the bank said: “Sell everything except high quality bonds. This is about return of capital, not return on capital. In a crowded hall, exit doors are small.” It said the current situation was reminiscent of 2008, when the collapse of the Lehman Brothers investment bank led to the global financial crisis. This time China could be the crisis point.

Stock markets have already come under severe pressure in 2016, with the FTSE 100 down more than 5% in its worst start since 2000. In the US, the Dow Jones industrial average has made its poorest ever start to a year.

Oil prices have also fallen sharply on fears of lower demand and a supply glut, especially with Iran due to start exporting once more when sanctions are lifted. Tensions between Iran and Saudia Arabia make it less likely that Opec can agree to cut production to halt the slide in prices. Brent crude is down another 1% at $31.18, its lowest level since April 2004.

Investors have been spooked by fears of a severe slowdown in the Chinese economy and a fall in the value of the yuan, not helped by a crash in the country’s stock market despite attempts by the country’s authorities to curtail selling.

Andrew Roberts, RBS’s credit chief, said: “China has set off a major correction and it is going to snowball. Equities and credit have become very dangerous, and we have hardly even begun to retrace the ‘Goldilocks love-in’ of the last two years.” » | Nick Fletcher | Tuesday, January 12, 2016

Powerball Jackpot Rises to $1.3 Billion

Jan. 10, 2016 - 1:47 - Hopefuls rush to buy tickets for unprecedented jackpot

Billiges Öl zwingt Saudiarabien zum Sparen

Weil die Ölpreise drastisch gesunken sind, erwartet das saudische Königshaus ein Milliardendefizit - und hat deshalb drastische Sparmassnahmen angekündigt. Im Zentrum steht ein Subventionsabbau auf Strom, Wasser und Treibstoff. Zudem soll die Wirtschaft reformiert werden. Das Gespräch mit dem Saudiarabien-Kenner Tobi Matthiesen.

Dutch City Plans to Pay All Citizens a ‘Basic Income’, and Greens Say It Could Work in the UK

THE GUARDIAN: Utrecht takes step towards paying people a salary whether they work or not

It’s an idea whose adherents over the centuries have ranged from socialists to libertarians to far-right mavericks. It was first proposed by Thomas Paine in his 1797 pamphlet, Agrarian Justice, as a system in which at the “age of majority” everyone would receive an equal capital grant, a “basic income” handed over by the state to each and all, no questions asked, to do with what they wanted.

It might be thought that, in these austere times, no idea could be more politically toxic: literally, a policy of the state handing over something for nothing. But in Utrecht, one of the largest cities in the Netherlands, and 19 other Dutch municipalities, a tentative step towards realising the dream of many a marginal and disappointed political theorist is being made. » | Daniel Boffey in Utrecht | Saturday, December 26, 2015

Merry Christmas! Joyeux Noël ! Fröhliche Weihnachten! Buon Natale! Felix Nativitas! Nadolig Llawen!

'We Three Kings', an original collage by James C. Christensen.
Courtesy of Google Images

Louis-Claude Daquin: Noël X

Hark the Herald Angels Sing
Hark the Herald Angel Sing - St.Paul's Cathedral - London (UK)

Gloria in excelsis Deo Et in terra pax hominibus bonae voluntatis, Laudamus te, benedicimus te, adoramus te. Glorificamus te. Gratias agimus tibi, propter magnam gloriam tua.

Inequality: Richest One Per Cent 'Have as Much Wealth as the Poorest 57 Per Cent Combined'

THE INDEPENDENT: The full extent of the banking industry’s influence over the Chancellor has been revealed

The economic disparities of modern Britain have been put on stark display, as official statistics revealed that the nation’s already-yawning wealth gap has widened still further over the past two years.

The richest 1 per cent of the population have as much wealth as the poorest 57 per cent combined, according to Office for National Statistics figures. The agency also found overall wealth inequality has increased since 2012, mainly thanks to the soaring price of housing in the South-east of England and London. » | Ben Chu, Economics Editor | Friday, December 18, 2015

Federal Reserve Announces First Rise in US Interest Rates Since 2006

Fed chair Janet Yellen signalled to Congress earlier this month
that the US economy was strong enough for the Fed to raise rates.

THE GUARDIAN: US central bank signals end to seven years of a monetary policy that began amid the worst financial crisis since the Great Depression

The Federal Reserve raised interest rates on Wednesday, ending an extraordinary period of government intervention in the financial markets that started at the height of the recession.

After holding its benchmark federal-funds rate near zero for seven years, the Fed increased rates a quarter-percentage point. The move signals the end of a monetary policy that began amid the worst financial crisis since the Great Depression.

In a statement the Fed said economic activity had been “expanding at a moderate pace. Household spending and business fixed investment have been increasing at solid rates in recent months, and the housing sector has improved further.”

Given the economic outlook, and “recognizing the time it takes for policy actions to affect future economic outcomes,” the Fed decided to raise the target range for the federal funds rate a quarter point, the first such rise in close to a decade.

The central bank signalled more increases to come “with gradual adjustments in the stance of monetary policy” and argued that “economic activity will continue to expand at a moderate pace and labor market indicators will continue to strengthen.” » | Dominic Rushe in New York and Jana Kasperkevic in Washington | Wednesday, December 16, 2015

US Federal Reserve Raises Interest Rates for First Time Since 2006

'Saudis Playing Dangerous Game As Oil Prices Plunge'

The Russian economy, which is heavily reliant on oil prices, is bearing the brunt of the low oil prices. For more on the falling oil and what it means for the Russian and Saudi economies – RT is joined by Michael Klare, an expert on natural resources, and author of 'Resource Wars, Blood and Oil'

Russia Plans $40 a Barrel Oil for Next Seven Years as Saudi Showdown Intensifies

THE TELEGRAPH: 'We will live in a different reality,' said a top Kremlin official. The message is aimed squarely at Saudi Arabia in a war for market share

Russia is battening down the hatches for a Biblical collapse in oil revenues, warning that crude prices could stay as low as $40 a barrel for another seven years.

Maxim Oreshkin, the deputy finance minister, said the country is drawing up plans based on a price band fluctuating between $40 to $60 as far out as 2022, a scenario that would have devastating implications for Opec.

It would also spell disaster for the North Sea producers, Brazil’s off-shore projects, and heavily indebted Western producers. “We will live in a different reality,” he told a breakfast forum hosted by Russian newspaper Vedomosti.

The cold blast from Moscow came as US crude plunged to $35.56, pummelled by continuing fall-out from the acrimonious Organisaton of Petrol Exporting Countries meeting last week. Record short positions by hedge funds have amplified the effect.

Bank of America said there was now the risk of “full-blown price war” within Opec itself as Saudi Arabia and Iran fight out a bitter strategic rivalry through the oil market. » | Ambrose Evans-Pritchard | Friday, December 11, 2015

Gulf States to Start Taxing People to Make Up for Oil Revenue Losses

People in the oil-rich Gulf monarchies have enjoyed lavish welfare and near-zero taxes for decades. But with the collapse of oil prices, governments no longer seem able to afford that.

Cadbury Owner Paid No UK Corporation Tax Last Year

THE GUARDIAN: Mondelez was able to pay no UK corporation tax as a result of a Channel Islands-based bond, despite Cadbury making £96.5m profit in 2014

Mondelez, which owns Cadbury, is facing controversy over its tax arrangements after it was reported that it had not paid UK corporation tax last year.

An investigation by the Sunday Times found the company was wiping out Cadbury’s bills using interest payments on an unsecured debt, which is listed as a bond on the Channel Islands’ stock exchange. The interest paid on the loan can be offset as a loss against gains made elsewhere in the company.

The arrangement, which is legal, meant Mondelez was able to pay no UK corporation tax despite accounts showing that Cadbury UK, its subsidiary, made profits of £96.5m in 2014 and £83.6m in 2013.

Margaret Hodge, chairwoman of the Commons all-party group on responsible tax, told the Sunday Times: “Multinationals like this are deliberately exporting their profits with artificial company structures to avoid tax. The founders of Cadbury who set it up as an ethical company will be turning in their graves.” » | Hilary Osborne | Sunday, December 6, 2015