Posts Categorized: In The News

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Bill Holter’s Commentary

No it is not about the corona virus, that is only cover for a credit system breakdown already in progress…

Credit Buys Us Time—But For What (On Economics)_001

Credit Buys Us Time—But For What (On Economics)_002

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Bill Holter’s Commentary

Do you need any other information to finally decide it is all about credit?

Just How Bad Is It Going To Get: JPMorgan Halts All Non-Government Guaranteed Small Business Loans
April 9, 2020

With America’s small and medium businesses suffering from cardiac arrest now that the economy is in a indefinite coma, it is hardly a surprise that the largest US bank, JPMorgan Chase has been inundated with more than 375,000 requests for $40bn of loans under the $350bn small business rescue scheme, a higher number of applications than any other bank, its consumer head Gordon Smith told President Donald Trump on Tuesday.

It is in this context that the FT reports that Chase has temporarily stopped accepting applications for small business loans outside the government’s Paycheck Protection Program. A Chase spokeswoman told the FT that the bank was now devoting all of its small business underwriting resources to processing these applications and had “temporarily suspended” taking other applications from small businesses. The bank was continuing to process non-PPP applications already in train, she said, and would revisit the issue of new applications next week.

This means that any small business that have borrowing needs beyond the PPP’s limits, or if they want to borrow for purposes beyond wage bills, they would need to seek other facilities or other lenders.

Ok fine, JPM is so busy trying to bail out mom and pop shops, it doesn’t have time to deal with anyone else. Why is that a story? Here’s why.

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Bill Holter’s Commentary

Did you ever think there could be any other response?

Free Markets Are Dead: Fed To Start Buying Junk Bonds, High Yield ETFs
April 9, 2020

Back on March 23, when the Fed unveiled it would start buying investment grade corporate bonds, we said “now that the Fed is effectively all in, it will buy stocks and junk bonds next.”

Two weeks later, we were right and this morning the Fed announced it would, as expected, start buying junk bonds (we have to wait for the next “market” – we use the term loosely because it is no longer a market which is terminally disconnected from fundamentals but a giant, Fed-fueled Ponzi scheme – crash before the Fed goes literally all in and starts buying stocks and pretty much anything else).

But let’s back up. A few days ago, we pointed out that the day so many credit bears had been waiting for had arrived, when a record $150BN in investment grade bonds were downgraded to junk, becoming so-called fallen angels, and sparking concerns about what will happen to the $1.3 trillion junk bond market as hundreds of billions of formerly investment grade debt is downgraded to junk and violently reprices the entire high yield space.

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Bill Holter’s Commentary

If you haven’t seen the full length movie, you should! Prepping for yourself is one thing, prepping for all the relatives (you know, the ones that called you an idiot for years now) who will eventually be showing up at your doorstep is another…

Bill Holter’s Commentary

Is the past prologue?

London Gold Pool Collapse 2020s (VIDEO)
April 4, 2020

To better understand where Gold is going, you have to know where it has been (gold price suppression history).

Especially in the context of our last 50+ full fiat currency regime years as only for a small single-digit percentage in that time was gold allowed to do its freaking premiere money job.

Given the ridiculous situation, central banks and fiat financialization has gotten us to in 2020, it’s only a brief time from now where the ultimate final bubble of this debt supercycle shows up in gold.

Here we dig through in detail how the City of London has often been at the center of rigging gold prices for the benefit of fiat financiers.

Such frauds and those who learned volatility injection from them (COMEX) are losing effect as the run on gold bullion have begun.

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Bill Holter’s Commentary

Since it is all about credit, the only thing that matters is math!

A Corporate-Debt Reckoning Is Coming
April 3, 2020

Via 13D Global Strategy and Research,

The following article was originally published in “What I Learned This Week” on March 26, 2020. To learn more about 13D’s investment research, please visit their website.

Corporate debt is the timebomb everyone saw ticking, but no one was able to defuse. Ratings agencies warned about it: Moody’s, S&P. Central banks and international financial institutions did too: the Fed, the Bank of England, the Bank for International Settlements, the IMF. Financial luminaries expressed concern: Jamie Dimon, Seth Klarman, Jes Staley, Jeffrey Gundlach, Henry McVey. Even a presidential candidate brought the issue on the campaign trail: Elizabeth Warren. Yet, as we’ve documented in these pages for more than two years, corporations have only piled on more debt as their balance sheet health has deteriorated.

Total U.S. non-financial corporate debt sits at just under $10 trillion, a record 47% of GDP. One in six U.S. companies is now a zombie, meaning their interest expenses exceed their earnings before interest and taxes. As of year-end 2019, the percentage of listed companies in the U.S. losing money over 12 months sat close to 40%. In the 12 months to November, non-financial S&P 500 cash balances had declined by 11%, the largest percentage decline since at least 1980.

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Bill Holter’s Commentary

Only 30%?  Good to see there are still some optimists out there…!

Here Comes The Next Crisis: Up To 30% Of All Mortgages Will Default In “Biggest Wave Of Delinquencies In History”
April 3, 2020

Unlike in the 2008 financial crisis when a glut of subprime debt, layered with trillions in CDOs and CDO squareds, sent home prices to stratospheric levels before everything crashed scarring an entire generation of homebuyers, this time the housing sector is facing a far more conventional problem: the sudden and unpredictable inability of mortgage borrowers to make their scheduled monthly payments as the entire economy grinds to a halt due to the coronavirus pandemic.

And unfortunately this time the crisis will be far worse, because as Bloomberg reports mortgage lenders are preparing for the biggest wave of delinquencies in history. And unless the plan to buy time works – and as we reported earlier there is a distinct possibility the Treasury’s plan to provide much needed liquidity to America’s small businesses may be on the verge of collapse – an even worse crisis may be coming: mass foreclosures and mortgage market mayhem.

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Bill Holter’s Commentary

Does the term “this is only Jacks for openers” mean anything to you?

Fed’s Balance Sheet Hits $6 Trillion: Up $1.6 Trillion In 3 Weeks

April 2, 2020

“We’re going to need a bigger chart.”

That’s all one can say when seeing what happened to the Fed’s balance sheet in the past week.

According to the Fed’s latest weekly H.4.1 (i.e., balance sheet) update, as of April 1 the Fed’s balance sheet hit a record $5.811 trillion, an increase of $557 billion in just one week. And when one adds the $88.5BN in TSY and MBS securities bought by the Fed today…

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