What Will Blow Up First? Part I

By: Gordon Long & John Rubino | Sat, Feb 22, 2014
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Europe? Japan? Emerging Markets?

What Will Blow Up First?

20 Minutes, 30 Slides

In Part I of this three part series John & Gord takes us an around the globe review in assessing what is most likely to blow up first. There was no shortage of troubling destinations!


Europe?

Central Bank Balance Sheets

It is clear that Europe is headed fro yet another recession unless the ECB adopts its version of Quantitative Easing - FAST! The Bundesbank's surprising capitulation on ECB sterilization is indicative of the seriousness of the accelerating problem.


Japan?

Japan h as been running huge public sector deficits for two decades and now has more debt as a percent of GDP - 220% - than any other major country. Possibly more than any major country ever. Japan then decided in 2013 to inflate away its debt by forcing the Bank of Japan to engineer an inflation rate of at least two percent.

ABE-NOMICS is not working:

IMPLICATIONS: A currency crisis waiting to happen.

Soverign Debt % of Tax Revenue


Emerging Markets - Sub-Prime Countries?

Hot money from developed world debt monetization caused asset bubbles and excessive borrowing in India, Thailand, Turkey, Brazil, etc. Now the how money is flowing back out, removing support from artificially-inflated asset prices. Emerging market currencies plunged, forcing most of them to impose capital controls and/or raise interest rates.

Brazil's overnight rate now 10.5%, Turkey's 12.5%. Emerging markets are the sub-prime borrowers of this cycle, the first to lose access to cheap credit in a crisis.

Developed world banks are on the hook for hundreds of billions to these countries. If they implode, it will be another "Lehman Moment," forcing the Fed, ECB and BOJ to choose between bailing out everyone in sight or presiding over the death of the global financial system.

Global Inflation Rates


Globalization Trap

Gord additionally illustrates how these scenarios fit within the work conducted at GordonTLong.com regarding the GLOBALIZATION TRAP outlined in their Free Thesis 2014 report.

Globalization Trap

 


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Gordon Long

Author: Gordon Long

Gordon T. Long
Publisher - LONGWave

Gordon T. Long

Gordon T. Long has been publically offering his financial and economic writing since 2010, following a career internationally in technology, senior management & investment finance. He brings a unique perspective to macroeconomic analysis because of his broad background, which is not typically found or available to the public.

Mr. Long was a senior group executive with IBM and Motorola for over 20 years. Earlier in his career he was involved in Sales, Marketing & Service of computing and network communications solutions across an extensive array of industries. He subsequently held senior positions, which included: VP & General Manager, Four Phase (Canada); Vice President Operations, Motorola (MISL - Canada); Vice President Engineering & Officer, Motorola (Codex - USA).

After a career with Fortune 500 corporations, he became a senior officer of Cambex, a highly successful high tech start-up and public company (Nasdaq: CBEX), where he spearheaded global expansion as Executive VP & General Manager.

In 1995, he founded the LCM Groupe in Paris, France to specialize in the rapidly emerging Internet Venture Capital and Private Equity industry. A focus in the technology research field of Chaos Theory and Mandelbrot Generators lead in the early 2000's to the development of advanced Technical Analysis and Market Analytics platforms. The LCM Groupe is a recognized source for the most advanced technical analysis techniques employed in market trading pattern recognition.

Mr. Long presently resides in Boston, Massachusetts, continuing the expansion of the LCM Groupe's International Private Equity opportunities in addition to their core financial market trading platforms expertise. GordonTLong.com is a wholly owned operating unit of the LCM Groupe.

Gordon T. Long is a graduate Engineer, University of Waterloo (Canada) in Thermodynamics-Fluid Mechanics (Aerodynamics). On graduation from an intensive 5 year specialized Co-operative Engineering program he pursued graduate business studies at the prestigious Ivy Business School, University of Western Ontario (Canada) on a Northern & Central Gas Corporation Scholarship. He was subsequently selected to attend advanced one year training with the IBM Corporation in New York prior to starting his career with IBM.

Gordon T Long is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, he recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.

The information herein was obtained from sources which Mr. Long believes reliable, but he does not guarantee its accuracy. None of the information, advertisements, website links, or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. Please note that Mr. Long may already have invested or may from time to time invest in securities that are recommended or otherwise covered on this website. Mr. Long does not intend to disclose the extent of any current holdings or future transactions with respect to any particular security. You should consider this possibility before investing in any security based upon statements and information contained in any report, post, comment or recommendation you receive from him.

Copyright © 2010-2014 Gordon T. Long

John Rubino

Author: John Rubino

John Rubino
DollarCollapse.com

John Rubino is author of Clean Money: Picking Winners in the Green Tech Boom (Wiley, December 2008), co-author, with GoldMoney's James Turk, of The Collapse of the Dollar and How to Profit From It (Doubleday, January 2008), and author of How to Profit from the Coming Real Estate Bust (Rodale, 2003). After earning a Finance MBA from New York University, he spent the 1980s on Wall Street, as a currency trader, equity analyst and junk bond analyst. During the 1990s he was a featured columnist with TheStreet.com and a frequent contributor to Individual Investor, Online Investor, and Consumers Digest, among many other publications. He now writes for CFA Magazine and edits DollarCollapse.com and GreenStockInvesting.com.

Copyright © 2006-2014 John Rubino

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Source: The Contrarian Take http://blogs.forbes.com/michaelpollaro/
austrian-money-supply/