Signalling the collapse of stock markets is IMMINENT, the Royal Bank of Scotland (RBS) has told clients today that 2016 will be “cataclysmic” and they should SELL EVERYTHING except high quality bonds”
Even worse, JP Morgan told clients today “Use any bounce as a selling opportunity.”
When financial heavyweights like RBS and JPM publicly say such things, the end is nigh; it means it is already too late.
I fear financial DOOM tomorrow as investors digest this advice overnight.
This could be “it.”
RBS cries ‘sell everything’ as deflationary crisis nears
Clients told to seek safety of Bunds and Treasuries. ‘This is about return of capital, not return on capital. In a crowded hall, exit doors are small’
RBS has advised clients to brace for a “cataclysmic year” and a global deflationary crisis, warning that major stock markets could fall by a fifth and oil may plummet to $16 a barrel.
The bank’s credit team said markets are flashing stress alerts akin to the turbulent months before the Lehman crisis in 2008. “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 in a client note.
Andrew Roberts, the bank’s credit chief, said that global trade and loans are contracting, a nasty cocktail for corporate balance sheets and equity earnings. This is particularly ominous given that global debt ratios have reached record highs.
“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 ‘Goldlocks love-in’ of the last two years,” he said.
Mr Roberts expects Wall Street and European stocks to fall by 10pc to 20pc, with even an deeper slide for the FTSE 100 given its high weighting of energy and commodities companies. “London is vulnerable to a negative shock. All these people who are ‘long’ oil and mining companies thinking that the dividends are safe are going to discover that they’re not at all safe,” he said.
Bearish J.P Morgan says sell stocks on any rally
For first time in seven years, advice moves away from buy the dips
J.P. Morgan Chase has turned its back on the stock market: For the first time in seven years, the investment bank is urging investors to sell stocks on any bounce.
“Our view is that the risk-reward for equities has worsened materially. In contrast to the past seven years, when we advocated using the dips as buying opportunities, we believe the regime has transitioned to one of selling any rally,” Mislav Matejka, an equity strategist at J.P. Morgan, said in a report.
Aside from technical indicators, expectations of anemic corporate earningscombined with the downward trajectory in U.S. manufacturing activity and a continued weakness in commodities are raising red flags.
“We fear that the incoming fourth-quarter reporting season won’t be able to provide much reassurance for stocks,” he said.
BoA: Rail traffic an indication of economic slowdown
Railroad cargo in the U.S. dropped the most in six years in 2015, and things aren’t looking good for the new year.
“We believe rail data may be signaling a warning for the broader economy,” the recent note from Bank of America says. “Carloads have declined more than 5 percent in each of the past 11 weeks on a year-over-year basis. While one-off volume declines occur occasionally, they are generally followed by a recovery shortly thereafter. The current period of substantial and sustained weakness, including last week’s -10.1 percent decline, has not occurred since 2009.”
Amid Stock Market Panic, Dozens Of Chinese Billionaires Are Mysteriously Disappearing
Maritime Shipping Stops
The continued collapse of The Baltic Dry Index. Today down to 415
Last week, I received news from a contact who is friends with one of the biggest billionaire shipping families in the world. He told me they had no ships at sea right now, because operating them meant running at a loss.
This weekend, reports are circulating saying much the same thing: The North Atlantic has little or no cargo ships traveling in its waters. Instead, they are anchored. Unmoving. Empty.
Commerce between Europe and North America has literally come to a halt. For the first time in known history, not one cargo ship is in-transit in the North Atlantic between Europe and North America. All of them (hundreds) are either anchored offshore or in-port. NOTHING is moving.
This has never happened before. It is a horrific economic sign; commerce is literally stopped.
The pundits can disingenuously blame the crashing Baltric Dry Index on container ship overcapacity and find some dopes to believe that fairy tale, but there’s only one explanation for collapsing rail freight shipment volume in the United States: the consumer has finally suffocated from too much debt and declining real income.
We believe rail data may be signaling a warning for the broader economy,” the recent note from Bank of America says. “Carloads have declined more than 5 percent in each of the past 11 weeks on a year-over-year basis. While one-off volume declines occur occasionally, they are generally followed by a recovery shortly thereafter. The current period of substantial and sustained weakness, including last week’s -10.1 percent decline, has not occurred since 2009. – Bank of America brain trust
Eric Dubin of The News Doctors brought this article to my attention: Rail Traffic Is Saying Something Worrying About the U.S. Economy
I’d like to point out that the price of oil is collapsing. It will soon be in the $20’s. Several Wall Street fraud shops have decided that oil is headed to $20. I made that call 6 months ago. Oil is the economy’s canary in the coal mine that the Fed can not remove before it dies. Rail freight traffic is the canary’s twin brother.
I hope everyone is braced for impact because the system is in for a much bigger shock than occurred in 2008/2009…and the Fed is out of bullets – just ask former Fed President Richard Fisher…
Economic Collapse Happening Now -Rob Kirby & Greg Hunter Video
acroeconomic analyst Rob Kirby’s predictions of a downward spiraling economy are coming true. Kirby contends, “I think the last time we spoke, it was in early December. I suggested that a window was opening where we were very likely to see some systemic breakdowns in our financial universe to likely start occurring.