Retail Apocalypse Gains Momentum As David Stockman Warns ‘Everything Will Grind To A Halt’ After March - Michael Snyder THE ECONOMIC COLLAPSE BLOG

Retail Apocalypse Gains Momentum As David Stockman Warns ‘Everything Will Grind To A Halt’ After March 15th Posted: 26 Feb 2017   Michael Snyder  THE ECONOMIC COLLAPSE BLOG J.C. Penney and Family Christian Stores are the latest retail giants to announce widespread store closings. As you will see below, J.C. Penney plans to close between 130 and 140 stores, and Family Christian is closing all of their 240 stores. In recent months the stock market has been absolutely soaring, and so most people have simply assumed that the “real economy” must be doing well. But that is not the case at all. In fact, the retail apocalypse that I have been documenting for quite some time appears to be gaining momentum. J.C. Penney is not in as rough shape as Sears is just yet, but it is definitely on a similar trajectory. In the end, they are both headed for bankruptcy. That is why it wasn’t too much of a surprise when J.C. Penney announced that they are getting rid of about 6,000 workers and closing at least 130 stores… J.C. Penney (JCP) plans to close 130 to 140 stores and offer buyouts to 6,000 workers as the department-store industry sags in competition with online sellers and nimble niche retailers. The company said Friday that it would shutter 13% to 14% of its locations and introduce new goods and services aimed at the shifting preferences of its customer base. Meanwhile, many observers were quite surprised when Family Christian Stores decided to fold up shop for good. They were known as the largest Christian retailer on the entire planet, but now after 85 years they are going out of business forever… Family Christian, which bills itself as the “world’s largest retailer of Christian-themed merchandise,” announced Thursday it is closing after 85 years. The non-profit company, employing more than 3,000 people in 240 stores in 36 states, said in a brief statement that the retailer had been facing declining sales since filing for bankruptcy protection in 2015 and had no choice but to shut down. These two announcements are part of larger trend that we have been witnessing all over the country. As I have documented previously, Macy’s announced that it would be closing 100 stores earlier this year, and about the same time Sears said that it would be closing another 150 stores. Back in 2010, Sears had a staggering 3,555 stores. Before their recent announcement, Sears was down to 1,503 stores, and now this latest round of cuts will leave them with somewhere around 1,350. Of course it won’t be too long before Sears has zero stores, and my regular readers know that I have been talking about the demise of Sears for a very long time. The cold, hard truth of the matter is that the “real economy” is a total mess, and that is one of the primary reasons why these ridiculous stock market valuations that we are seeing right now are not sustainable. One expert that agrees with my assessment is former Reagan Administration White House Budget Director David Stockman. In a recent interview, he explained why he believes that “everything will grind to a halt” after March 15th… Stockman, who wrote a book titled “Trumped” predicting a Trump victory in 2016, says, “I don’t think there is a snowball’s chance in the hot place that’s going to happen. This is delusional. This is the greatest suckers’ rally of all time. It is based on pure hopium and not any analysis at all as what it will take to push through a big tax cut. Donald Trump is in a trap. Today the debt is $20 trillion. It’s 106% of GDP. . . .Trump is inheriting a built-in deficit of $10 trillion over the next decade under current policies that are built in. Yet, he wants more defense spending, not less. He wants drastic sweeping tax cuts for corporations and individuals. He wants to spend more money on border security and law enforcement. He’s going to do more for the veterans. He wants this big trillion dollar infrastructure program. You put all that together and it’s madness. It doesn’t even begin to add up, and it won’t happen when you are struggling with the $10 trillion of debt that’s coming down the pike and the $20 trillion that’s already on the books.” Then, Stockman drops this bomb and says: “I think what people are missing is this date, March 15th 2017. That’s the day that this debt ceiling holiday that Obama and Boehner put together right before the last election in October of 2015. That holiday expires. The debt ceiling will freeze in at $20 trillion. It will then be law. It will be a hard stop. The Treasury will have roughly $200 billion in cash. We are burning cash at a $75 billion a month rate. By summer, they will be out of cash. Then we will be in the mother of all debt ceiling crises. Everything will grind to a halt. I think we will have a government shutdown. There will not be Obama Care repeal and replace. There will be no tax cut. There will be no infrastructure stimulus. There will be just one giant fiscal bloodbath over a debt ceiling that has to be increased and no one wants to vote for.” In that same interview, Stockman also predicted that “markets will easily correct by 20% and probably a lot more“, and he noted the glaring disconnect between current stock prices and how the U.S. economy is actually performing… “The S&P 500 has been trading at 26 times earnings while earnings have been dropping for the past six or seven quarters. There is no booming recovery coming. There is going to be a recession and there will be no stimulus baton to bail it out. That is the new fact that neither Trump nor the Wall Street gamblers remotely understand.” It is very difficult to argue with Stockman on this. There are some people out there that seem to think that Donald Trump can miraculously turn the U.S. economy around just because he is Donald Trump. It doesn’t work that way. We are 20 trillion dollars in debt, and we are currently adding about a trillion dollars a year to that total. There is no possible way that Trump can cut taxes, increase military spending, build a border wall, spend much more on veterans and spend an extra trillion dollars on rebuilding our crumbling infrastructure. We are flat broke as a nation and there simply is not money available to do everything that Donald Trump wants to do. So we shall see what happens after March 15th.  Unfortunately, I happen to agree with Stockman that economic reality is about to come knocking and Trump and his supporters are about to get a very rude wake up call.

After Raising Rates Once During The Obama Years, The Fed Promises Constant Rate Hikes During The Trump Era - Michael Snyder THE ECONOMIC COLLAPSE BLOG

After Raising Rates Once During The Obama Years, The Fed Promises Constant Rate Hikes During The Trump Era

Posted: 14 Dec 2016   Michael Snyder  THE ECONOMIC COLLAPSE BLOG

Now that Donald Trump has won the election, the Federal Reserve has decided now would be a great time to start raising interest rates and slowing down the economy.  Over the past several decades, the U.S. economy has always slowed down whenever interest rates have been raised significantly, and on Wednesday the Federal Open Market Committee unanimously voted to raise rates by a quarter point.  Stocks immediately started falling, and by the end of the session it was their worst day since October 11th.

The funny thing is that the Federal Reserve could have been raising rates all throughout 2016, but they held off because they didn’t want to hurt Hillary Clinton’s chances of winning the election.

And during Barack Obama’s eight years, there has only been one rate increase the entire time up until this point.

But now that Donald Trump is headed for the White House, the Federal Reserve has decided that now would be a wonderful time to raise interest rates.  In addition to the rate hike on Wednesday, the Fed also announced that it is anticipating that rates will be raised three more times each year through the end of 2019…

Fed policymakers are also forecasting three rate increases in 2017, up from two in September, and maintained their projection of three hikes each in 2018 and 2019, according to median estimates. They predict the fed funds rate will be 1.4% at the end of 2017, 2.1% at the end of 2018 and 2.9% at the end of 2019, up from forecasts of 1.1%, 1.9% and 2.6%, respectively, in September. Its long-run rate is expected to be 3%, up slightly from 2.9% previously. The Fed reiterated rate increases will be “gradual.”

So Barack Obama got to enjoy the benefit of having interest rates slammed to the floor throughout his presidency, and now Donald Trump is going to have to fight against the economic drag that constant interest rate hikes will cause.

How is that fair?

As rates rise, ordinary Americans are going to find that mortgage payments are going to go up, car payments are going to go up and credit card bills are going to become much more painful.  The following comes from CNN…

Higher interest rates affect millions of Americans, especially if you have a credit card or savings account, or want to buy a home or a car. American savers have earned next to nothing at the bank for years. Now they could be a step closer to earning a little more interest on savings account deposits, even though one rate hike won’t change things overnight.
Rates on car loans and mortgages are also likely to be affected. Those are much more closely tied to the interest on a 10-year U.S. Treasury bond, which has risen rapidly since the election. With a Fed hike coming at a time when interest on the 10-year note is also rising, that won’t help borrowers.

The higher interest rates go, the more painful it will be for the economy.

If you recall, rising rates helped precipitate the financial crisis of 2008.  When interest rates rose it slammed people with adjustable rate mortgages, and suddenly Americans could not afford to buy homes at the same pace they were before.  We have already been watching the early stages of another housing crash start to erupt all over the nation, and rising rates will certainly not help matters.

But why does the Federal Reserve set our interest rates anyway?

We are supposed to be a free market capitalist economy.  So why not let the free market set interest rates?

Many Americans are expecting an economic miracle out of Trump, but the truth is that the Federal Reserve has far more power over the economy than anyone else does.  Trump can try to reduce taxes and tinker with regulations, but the Fed could end up destroying his entire economic program by constantly raising interest rates.

Of course we don’t actually need economic central planners.  The greatest era for economic growth in all of U.S. history came when there was no central bank, and in my article entitled “Why Donald Trump Must Shut Down The Federal Reserve And Start Issuing Debt-Free Money” I explained that Donald Trump must completely overhaul how our system works if he wants any chance of making the U.S. economy great again.

One way that Trump can start exerting influence over the Fed is by nominating the right people to the Federal Open Market Committee.  According to CNN, it looks like Trump will have the opportunity to appoint four people to that committee within his first 18 months…

Two spots on the Fed’s committee are currently open for Trump to nominate. Looking ahead, Fed Chair Janet Yellen’s term ends in January 2018, while Vice Chair Stanley Fischer is up for re-nomination in June 2018.
Within the first 18 months of his presidency, Trump could reappoint four of the 12 people on the Fed’s powerful committee — an unusual amount of influence for any president.

By endlessly manipulating the economy, the Fed has played a major role in creating economic booms and busts.  Since the Fed was created in 1913, there have been 18 distinct recessions or depressions, and now the Fed is setting the stage for another one.

And anyone that tries to claim that the Fed is not political is only fooling themselves. 
Everyone knew that they were not going to raise rates during the months leading up to the election, and it was quite clear that this was going to benefit Hillary Clinton.

But now that Donald Trump has won the election, the Fed all of a sudden has decided that the time is perfect to begin a program of consistently raising rates.

If I was Donald Trump, I would be looking to shut down the Federal Reserve as quickly as I could.  The essential functions that the Fed performs could be performed by the Treasury Department, and we would be much better off if the free market determined interest rates instead of some bureaucrats.

Unfortunately, most Americans have come to accept that it is “normal” to have a bunch of unelected, unaccountable central planners running our economic system, and so it is unlikely that we will see any major changes before our economy plunges into yet another Fed-created crisis.

War On The Homeless: Cities All Over America Are Passing Laws Making It Illegal To Feed And Shelter Those In Need - Michael Snyder THE ECONOMIC COLLAPSE

War On The Homeless: Cities All Over America Are Passing Laws Making It Illegal To Feed And Shelter Those In Need Posted: 06 Dec 2016   Michael Snyder  THE ECONOMIC COLLAPSE  If you want to be a “Good Samaritan” to the homeless in your community, you might want to check and see if it is legal first.  All over the country, cities are passing laws that make it illegal to feed and shelter the homeless.   For example, in this article you will read about a church in Maryland that was just fined $12,000 for simply allowing homeless people to sleep outside the church at night.  This backlash against homeless people comes at a time when homelessness in America is absolutely exploding.   In a previous article, I shared with my readers the fact that the number of homeless people in New York City has just set a brand new all-time high, and the homelessness crisis in California has become so severe that the L.A. City Council has formally asked Governor Jerry Brown to declare a state of emergency.  Sadly, instead of opening up our hearts to the rapidly growing number of Americans without a home, way too many communities are trying to use the law to force them to go somewhere else. For nearly two thousand years, churches have been at the forefront of helping the poor and disadvantaged, but now many communities are trying to stop this from happening.  Earlier today, I was absolutely stunned when I came across an article that talked about how a church in Dundalk, Maryland has been fined $12,000 for allowing the homeless to sleep outside the church at night… “I showed up Wednesday morning to find a citation on the door that said we’re going to be fined $12,000 and have a court date because we have unhoused homeless people sleeping outside the church at night,” said Reverend Katie Grover with the Patapsco United Methodist Church. Grover added that the men and women who sleep outside their doors do so because they have nowhere else to go and because they feel safe there. “We feel we here as a church that it’s scriptural mandate that’s it an imperative to care for the least, the last, the lost, the poor, the hungry,” she said. The authorities in Dundalk say that the church is running a “non-permitted rooming and boarding house”, and the severity of this fine is likely to put the church in significant financial difficulty if it is forced to pay it.  You can watch a local news report discussing this story on YouTube right here… Of course Dundalk is far from alone.  All across the U.S. laws have been passed that specifically target the homeless.  According to the National Coalition for the Homeless, the following are some of the most typical ways that the homeless are targeted… Carrying out sweeps (confiscating personal property including tents, bedding, papers, clothing, medications, etc.) in city areas where homeless people live. Making panhandling illegal. Making it illegal for groups to share food with homeless persons in public spaces. Enforcing a “quality of life” ordinance relating to public activity and hygiene. There are some people that have been feeding the hungry for decades that now find that their work has been suddenly made illegal.  For instance, down in Houston a Good Samaritan named Jay Hamberger is outraged that the help that he has been providing to the homeless for 27 years has now made him an outlaw… Jay Hamberger has been bringing food to Houston’s homeless for 27 years. He feels the city is infringing on his right to help others by requiring him to have prior permission to distribute food on public and private property. “I’ve done it with impunity for 27 years now, and I’m the most law-abiding outlaw, because what I’m doing is illegal,” Hamberger said. “My understanding is that there’s no legal way to make this right with the city.” This is just another example of how our society is being strangled to death by control freaks. If I see someone that is desperately hungry and I want to give that person food, then I am going to do it no matter what the law says. Unfortunately, as the homelessness crisis continues to escalate these types of laws are only going to increase.  Even in supposedly “tolerant” areas of the country we are seeing draconian measures being implemented.  For example, just check out the new ordinance that was just passed in Los Angeles… LA legislators passed an ordinance that would ban people from sleeping in cars and recreational vehicles (RVs) near homes, parks and schools. Advocates see the ordinance as the latest move to criminalize homeless people. The Los Angeles City Council voted in favor of the ordinance on Wednesday. Banning people from sleeping near homes, schools and parks in their vehicles, would, if signed into law, only make it legal to sleep overnight in cars and RV’s in industrial or commercial districts from 9:00pm to 6:00am. As millions of Americans have fallen out of the middle class in recent years, we have seen an explosion in the number of people living in cars, trucks and recreational vehicles.  This is something that I addressed in my recent article entitled “Living In A Van Down By The River – Time To Face The True State Of The Middle Class In America“.  During this time of the year many that live in their vehicles head for warmer climates, and cities like Los Angeles are responding to the influx of homeless people by trying to force them to go somewhere else. And this “war on the homeless” has actually been ramping up for quite a while.  Just check out these numbers from the Washington Post… Cities have enacted a wave of crackdowns and new laws against panhandling, camping and other activities associated with homelessness. They say such efforts help preserve the renewed vitality, curbing crime, health problems and behaviors that bother residents and disrupt business. Between 2011 and 2014, the National Law Center on Homelessness & Poverty found that bans on sleeping in cars shot up 119 percent, citywide camping prohibitions jumped 60 percent, anti-loitering laws increased 35 percent and anti-begging laws increased 25 percent in a survey of 187 cities. Homeless people do not have a permanent address, and there is always a temptation to try to force them to go somewhere else so that they become someone else’s problem. But the truth is that we have a massive national crisis on our hands.  The number of homeless children in this country has increased by 60 percent since the end of the last recession, and the number of homeless people sleeping in shelters has risen to record levels in major cities on both the east and west coast. And considering the fact that about two-thirds of the country is currently living paycheck to paycheck, how bad will things get once the next major recession strikes? Poverty is growing all over the nation, and at the same time hearts all over America are growing very cold. I truly fear for what this country is going to look like just a few years from now.

11 Very Depressing Economic Realities That Donald Trump Will Inherit From Barack Obama - Michael Snyder THE ECONOMIC COLLAPSE BLOG

11 Very Depressing Economic Realities That Donald Trump Will Inherit From Barack Obama Posted: 15 Nov 2016 Michael Snyder  THE ECONOMIC COLLAPSE BLOG It would be a grave mistake to understate the amount of damage that has been done to the U.S. economy over the past eight years.  In this article, I am going to share some economic numbers with you that are extremely sobering.  Anyone that takes a cold, hard, honest look at the numbers should be able to see that our economy is in terrible shape.  Unfortunately, the way that we see things is often clouded by our political views.   Up until the election, Democrats were far more likely then Republicans to believe that the economy was improving, but now that is in the process of completely reversing.  According to Gallup, only 16 percent of Republicans believed that the economy was getting better before the election, but that number has suddenly jumped to 49 percent after Trump’s election victory.  And the percentage of Democrats that believe that the economy is getting better fell from 61 percent to 46 percent after the election.  Here are some additional details from Gallup… After Trump won last week’s election, Republicans and Republican-leaning independents now have a much more optimistic view of the U.S. economy’s outlook than they did before the election. Just 16% of Republicans said the economy was getting better in the week before the election, while 81% said it was getting worse. Since the election, 49% say it is getting better and 44% worse. Conversely, Democrats and Democratic-leaning independents’ confidence in the economy plummeted after the election. Before the election, 61% of Democrats said the economy was getting better and 35% worse. Now, Democrats are evenly divided, with 46% saying it is getting better and 47% saying it is getting worse. The truth, of course, is that the result of the election did not somehow magically alter the outlook for the U.S. economy. We still have a giant mess on our hands, and the following are 11 very depressing economic realities that Donald Trump will inherit from Barack Obama… #1 Nearly 7 out of every 10 Americans have less than $1,000 in savings.  That means that about two-thirds of the country is essentially living paycheck to paycheck at this moment. #2 Reuters is reporting that U.S. mall investors are poised to lose “billions” of dollars as the “retail apocalypse” in this nation deepens. #3 Credit card delinquencies have hit the highest level that we have seen since 2012. #4 Approximately 35 percent of all Americans have a debt that is at least 180 days past due. #5 The rate of homeownership has fallen for eight years in a row and is now hovering near a 50 year low. #6 The total number of government employees now outnumbers the total number of manufacturing employees in this country by almost 10 million. #7 The number of homeless people in New York City (where Donald Trump is from) has hit a brand new record high. #8 About 20 percent of all young adults are currently living with their parents. #9 Total household debt in the United States has now reached a grand total of 12.3 trillion dollars. #10 The total amount of corporate debt in the U.S. has nearly doubled since the end of 2007. #11 When Barack Obama entered the White House, the U.S. government was 10.6 trillion dollars in debt.  Today, the U.S. national debt is currently sitting at a staggering total of $19,842,173,949,869.58. Despite nearly doubling the national debt during his eight years in the White House, Barack Obama is going to be the only president in United States history to never have a single year when U.S. GDP grew by at least three percent. So will Donald Trump waltz in and suddenly turn everything around? Just like when George W. Bush was elected, there is a lot of optimism about the future right now among Republicans. And in 2017, Republicans are going to have control of the Senate and the House in addition to being in control of the White House. But does that mean that they will actually get anything done? For a moment, let’s review what didn’t happen the last time the Republicans were in this position.  The following is an extended excerpt from an article by author Devvy Kidd… —– The Republicans had control of both houses of Congress part of the time during Bush, Jr.’s two terms. Did they lock down our borders? NO. Did they pass legislation to stop ALL funding for illegals which would self-deport millions of liars, cheats and thieves? NO. (READ, please: How to Self-Deport Millions of Illegals) Did they stop trillions in unconstitutional spending? NO. Did they get rid of any of Clinton’s unconstitutional Executive Orders? One or two but otherwise let Comrade Bill Clinton crap in our faces. Did they get rid of one unconstitutional cabinet like HHS, Department of Education and EPA? NO. Did they stop the unconstitutional foreign aid? NO. Did they stop unconstitutional spending for Planned Parenthood? NO. Congress just continues to use borrowed money to spend more debt. Did they stop unconstitutional spending for the gigantic hoax called global warming or climate change? NO. Trump: The Left Just Lost The War On Climate Change Did Bush, Jr., get us out of all the destructive trade treaties killing American jobs? NO. Did they crack down on visas bringing in tens of thousands of foreign workers when American workers who want to work are left in the unemployment line? NO. Did they stop more and more federal regulations strangling America’s businesses? NO. Did they impeach one single activist judge destroying our freedom and liberty? NO. A Republican controlled Congress with a Republican in the White House and they did virtually NOTHING to restore America to a constitutional republic and constitutional spending. —– So will things be any different under a Trump administration? We shall see. There will be tremendous pressure to maintain the status quo in many instances, because the process of fixing things would undoubtedly make conditions worse in the short-term. A great example of this is the national debt.  As I discussed yesterday, the only reason why we are able to enjoy such a massively inflated standard of living in this country is because we have been able to borrow trillions upon trillions of dollars from the rest of the world at ultra-low interest rates. If the federal government started spending only the money that it brought in through taxes, our ridiculous debt-fueled standard of living would begin collapsing immediately. We consume far more wealth than we produce, and the only way that we are able to do this is by borrowing insane amounts of money. Either Donald Trump will continue to borrow money recklessly, or we will go into a major league economic downturn. It really is that simple. But when our politicians borrow money, they are literally destroying the future of this country.  So the choice is pain in the short-term or greater pain in the long-term. There is a way out, and that would involve shutting down the Federal Reserve and going to a completely debt-free form of money, but that is a topic for another article. And unfortunately that is not something that is even on Donald Trump’s radar at this point. No matter who won the election, the next president was going to be faced with some very harsh economic realities. There are many out there that have faith that Donald Trump can pull off an unprecedented economic miracle, but there are others that are deeply skeptical. Let us hope for the best, but let us also keep preparing for the worst.

World War 3 Coming Soon? Tanks Roll Across The Border As Turkish Invasion Of Syria Begins - Michael Snyder THE ECONOMIC COLLAPSE BLOG

World War 3 Coming Soon? Tanks Roll Across The Border As Turkish Invasion Of Syria Begins Posted: 25 Aug 2016   Michael Snyder  THE ECONOMIC COLLAPSE BLOG The invasion of Syria that so many people have been warning about is now happening. On Wednesday, Turkish tanks rolled across the Syrian border, and they were accompanied by radical Islamic Syrian rebels that want to ultimately overthrow the Assad regime.  This invasion was conducted under the code name “Euphrates Shield”, and it was supported by airstrikes from A-10s and F-16s that are part of the U.S.-led coalition that has been conducting airstrikes against ISIS targets in the region.   The mainstream media in the United States has been very quiet about this escalation of the conflict in Syria, but things are much different in the rest of the world.  For example, a major Israeli news source announced the attack this way: “Turkey invades Syria“.  And without a doubt, that is precisely what is taking place.  The Syrian government denounced this move by Turkey as a “blatant breach to its sovereignty”, and the Russians are deeply alarmed.  The farther Turkish forces push into northern Syria, the more likely they will be to encounter Syrian or Russian forces, and one bad move could result in the outbreak of World War 3 in the Middle East. The fact that the U.S. media is treating this invasion of Syria as if it is of little importance is deeply disturbing.  These days, the big news channels are obsessed with feeding us propaganda about how “healthy” Hillary Clinton is, or about how “racist” Donald Trump is, and they spend exceedingly little time on the things that really matter all over the globe. Fortunately, it is not the same way around much of the rest of the planet.  Here is an excerpt from a British news source about the Turkish attack… It is hard to anticipate whether Turkey’s unprecedented military incursion into Syria this week will change the dynamics of the multiple wars that have ravaged the region and put civilians through hell. If things already seemed complicated in the Middle East, they may have just become even more so. What started on Wednesday ranks as the largest Turkish military operation inside Syrian territory since the civil war began five years ago. A dozen tanks, reportedly followed by a bus transporting Syrian rebels, rolled into northern Syria to drive Islamic State forces from the town of Jarablus, one of their last footholds on the Turkish-Syrian border. Today Turkey sent more tanks in and told the YPG Kurdish armed group it had one week to retreat from the border areas. We are being told that the primary purpose of this Turkish invasion is “to fight ISIS”, but that is just for western consumption.  The truth is that Turkey has actually been supporting ISIS and other terror groups in Syria for a very long time.  In fact, it has been heavily documented that ISIS sold hundreds of millions of dollars worth of stolen oil through Turkey until the Russians put a stop to it. No, the real motivation for this assault is to stop the advance of Kurdish forces.  Turkish Foreign Minister Mevlut Cavusoglu recently promised that Turkey would “do what is necessary” to keep Kurdish fighters east of the Euphrates River, and even President Erdogan is admitting that the Kurds are primary targets in this operation… “(Wednesday’s operation) started in the north of Syria against terror groups which constantly threaten our country, like (ISIS) and the PYD,” Erdogan said, referring to a Syrian Kurdish opposition political party. And U.S. officials know exactly what Erdogan is doing.  Just check out what one of them told CNN… Another senior US official told CNN’s Barbara Starr the US assessment is that Turkey’s cross-border action is largely about trying to stop Kurdish action. “The Turks never cared about Jarablus until the Kurds wanted to get there,” the official said. So now the Turks have declared open season on the Kurds in northern Syria, and the Syrian Kurds are treating this move as “a declaration of war”… Spokesman for the YPG Kurdish militia, Redur Xelil, called Turkey’s move “blatant aggression in Syrian internal affairs.” Aldar Xelil, another influential Kurdish politician, accused Turkey of initiating an occupation of Syria, saying the operation amounted to “a declaration of war” on the autonomous administration set up by Kurdish groups in northern Syria in 2011. According to the Turkish government, Operation Euphrates Shield will “create a safe zone” that will be 90 kilometers long and 40 kilometers wide that stretches roughly from the town of Jarablus to the town of Marea. That is a massive amount of territory, and this basically shows that the Turks plan to set up shop there permanently. President Erdogan and his supporters have always dreamed of recreating the old Ottoman Empire, and they already have military forces occupying portions of northern Iraq.  This move into northern Syria is yet another bold move in the direction of their ultimate goal. But will the Russians just stand by and allow the Turks to do whatever they want? So far the Russians are not saying much, but Vladimir Putin has ordered snap military drills… Russian President Vladimir Putin ordered snap military drills as German Chancellor Angela Merkel accused him of breaking international law in Ukraine and said NATO will defend member states against attack. Combat readiness exercises are taking place “to defend the interests of the Russian Federation amid increasing threats to its security,” Defense Minister Sergei Shoigu said Thursday in a statement on the ministry’s website. Troops in Russia’s southern, central and western military districts, naval deployments in the Black Sea and Caspian Sea, and airborne forces are involved, he said. The Russians don’t want to fight Turkish forces in Syria, but as they have shown in Crimea, in Ukraine and elsewhere, they are definitely not afraid to take military action when their interests require it. And if Russia and Turkey do start fighting, that would threaten to drag the rest of NATO (including the United States) into the conflict. Turkey has been chomping at the bit to start grabbing chunks of territory in northern Syria for quite some time now, but this invasion is going to turn out to be a tragic mistake. President Erdogan has definitely overplayed his hand this time, and let us just hope that it doesn’t result in World War 3 erupting in the Middle East.

European Banks Have Their Worst Two Day Stretch EVER As The Global Financial Crisis Intensifies - Michael Snyder THE ECONOMIC COLLAPSE BLOG

European Banks Have Their Worst Two Day Stretch EVER As The Global Financial Crisis Intensifies

Posted: 27 Jun 2016   Michael Snyder  THE ECONOMIC COLLAPSE BLOG

Over the last two trading days, European banks have lost 23 percent of their value.  Let that number sink it for a bit.  In just a two day stretch, nearly a quarter of the value of all European banks has been wiped out.  I warned you that the Brexit vote “could change everything“, and that is precisely what has happened. 

Meanwhile, the Dow was down another 260 points on Monday as U.S. markets continue to be shaken as well.  Overall, approximately three trillion dollars of global stock market wealth has been lost over the last two trading days.  That is an all-time record, and any doubt that we have entered a new global financial crisis has now been completely eliminated.
But of course the biggest news on Monday was what happened to European banks.  The Brexit vote has caused financial carnage for those institutions unlike anything that we have ever seen before.  Just check out this chart from Zero Hedge…

I knew that things would be bad if the UK voted to leave the European Union, but I didn’t know that they would be this bad.

Prior to all of this, a whole bunch of “too big to fail” banks all over Europe were already in the process of imploding, and now this chaotic financial environment may push several of them into full-blown collapse mode simultaneously.  Just consider the following commentary from Wolf Richter…

Healthy big banks would get over Brexit and the political turmoil it is spawning, particularly non-UK banks. But there are no healthy big banks in Europe. And non-UK banks are crashing just as hard, and some harder. This is about a banking crisis morphing into a financial crisis.
These bank stocks got crushed on Friday. And they got crushed again today. Italian banks have been reduced to penny stocks. Spanish banks are getting closer. Commerzbank, Germany’s second largest bank, and still partially owned by the German government as a consequence of the last bailout, is well on the way.

One institution that I have been warning about for months is German banking giant Deutsche Bank.  On Monday, their stock fell another 5.77 percent to a fresh all-time closing low of 13.87.  I have been convinced that Deutsche Bank is going to zero for a long time, but these days it seems in quite a hurry to get there.

Of course Deutsche Bank is far from alone.  The following are other “too big to fail” European banks that have lost at least one-fifth of their value over the past two trading days…

-Barclays
-Royal Bank of Scotland
-Lloyds Banking Group
-Credit Suisse
-BNP Paribas
-Societe Generale
-UniCredit
-Intesa SanPaolo
-Banca Monte dei Paschi di Siena
-Banco Santander
-CaixaBank

This is what a full-blown financial crisis looks like, and U.S. banks have been getting hit very hard too…

The Brexit contagion is spreading as USD liquidity and counterparty risk in the interconnected global financial system has reached US banks with Goldman at 3 year lows and BofA and Citi plunging over 12%. This happens just two days after the Fed released its latest stress test results finding that none of the 33 banks tested would need additional capital in case of a “severe” financial crisis. That conclusion may be tested soon.

Meanwhile, the British pound continues to get absolutely pummeled.  As I write this, the GBP/USD is down to 1.32, and some are now warning that the British pound may hit parity with the U.S. dollar by the end of the year.

One of the reasons why I expect the British pound to continue to tumble is because the global elite have to show the British people that they made the wrong decision, and they need to scare off any other countries that would consider holding similar votes.

So it was no surprise that the elite had two of their major credit rating agencies downgrade the UK on Monday…

Two major rating agencies downgraded the United Kingdom’s credit rating on Monday.
S&P Global Ratings lowered the UK to AA from AAA, with a “negative” outlook. And, Fitch cut its rating to AA from AA+, with a negative outlook as well.

And as I mentioned yesterday, Bank of America and Goldman Sachs have already projected that the UK economy is heading into recession.

As much economic and financial pain as possible will be inflicted upon the British people, and meanwhile they will be bombarded by mainstream news stories telling them that they made a stupid decision.

Hopefully the British people will stand strong and will not give in to the pressure. But of course it isn’t just the British people that will be feeling the pain.  The Brexit vote has sent shockwaves all over the planet, and global investors are losing tremendous amounts of money.  For instance, here in the United States approximately 1.3 trillion dollars of stock market wealth has been wiped out so far…

Brexit isn’t just a European problem after all. The United Kingdom’s decision to quit the European Union is costing U.S. investors a pretty penny.
U.S.-based companies in the broad Russell 3000, including online advertising company Alphabet (GOOGL), software maker Microsoft (MSFT) and global bank JPMorgan Chase (JPM), have suffered a collective loss of $1.3 trillion since Friday’s shocker from the United Kingdom, according to a USA TODAY analysis of data from S&P Global Market Intelligence.

Hopefully tomorrow will be better.  It is very rare for global financial markets to crash for three days in a row, but it could happen.  More likely, however, is that we will see some kind of temporary bounce as long as some really negative event doesn’t hit the news.

But let there be no doubt about what has just happened.  The collapse of Lehman Brothers was the “trigger event” that really accelerated the crisis of 2008, and now it appears as though the Brexit vote will be the “trigger event” that greatly accelerates the crisis of 2016.
Global investors had already lost trillions over the past 12 months, and a full-blown financial implosion was going to happen no matter how the vote turned out, but thanks to British voters the fun and games have arrived early.

Unfortunately, only a very small fraction of the population understands just how bad things are going to get in the months ahead…