Economics and Investing:

Alternate Unemployment Charts 25percent sound good – B.B.

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The world can’t afford another financial crash – it could destroy capitalism as we know it – S.B.

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Items from Professor Preponomics:

US News

Four Horsemen of the Economic Apocalypse (Business Insider) Excerpt: “It’s getting impossible to ignore all the risks… We know how leveraged banks are… If they get in trouble, then that money is gone. People have been avoiding thinking about it.”

Yellen’s Dilemma: A Downturn with No Easy Response (Reuters) No right answer, and there’s no way out. In my opinion, there were going to be consequences whether Fed Chair Yellen raised rates or held them at or very near zero. Excerpt: “The U.S. Federal Reserve’s carefully scripted decision to raise interest rates last December, and begin a return to ‘normal’ policy, may now become a nightmare for the central bank if an economic downturn forces a return to unconventional methods.”

Something Very Disturbing Spotted in a Morgan Stanley Presentation (Zero Hedge) Excerpt: “With central bankers losing credibility left and right, and failing outright to boost the ‘wealth effect’ no matter what they throw at it, the next big question is when will central planners around the world unveil the cashless society which is a necessary and sufficient condition to a regime of global NIRP.” Warning: Commentary following the ZH article may contain bad language and/or inappropriate avatar images.

International News

The World Can’t Afford Another Financial Crash – It Could Destroy Capitalism as We Know It (The Telegraph) Excerpt: “It is always a sure sign that panic has broken out when financial markets respond badly to all possible scenarios. The prospect of higher interest rates? Sell, sell, sell. A chance of lower rates? Sell, sell and sell again. A rise in the price of oil is met with as much angst as a decline. The financial markets remain addicted to help from central banks: they are desperate for yet more interventions, regardless of the consequences on the pricing of risk, the allocation of resources or the creation of unsustainable bubbles that only enrich the owners of assets.”

Is the Sovereign Debt Crisis Coming Back to Haunt Europe? (The Telegraph) Excerpt: “It is only the ECB that is holding Europe together. If the ECB was to step back you would have a massive sovereign debt crisis.”

Will Italy Prompt a Global Financial Crisis (HuffPost Business) Excerpt: “The 2.5T Dollar Question: See from the US it looks as the same as Greece. There is however, a major difference: Italy’s public debt amounts to 2,470 billion dollars. The European Central Bank or the European institutions do not have the means to rescue Italy as they did for Greece that amounted to 350 billion. that means that it would be, at least a major banking and economic crisis in Europe. I do not believe it will limited to Europe. This Italian and European banking crisis will represent a multiple of the 2008 crisis. Is there a pilot in the plane?”

Greek Economy Returns to Recession After Shrinking in Fourth Quarter (Bloomberg) Excerpt: “The Country will face renewed euro-exit fears unless its government and European creditors come up with a credible plan to make the country’s debt sustainable….” Again, an opinion: there will be no resolution without substantial write-downs.

Personal Economics and Household Finance

Top 3 Tips for 50-Somethings to Avoid Identity Theft (BankRate) Watch those medical requests for your SSNs very, very carefully. Excerpt: “If you’re in your 50s, you probably have a well-established financial identity and you probably use more medical services than you did when you were younger. Those traits can make you a prime target of identity thieves.”

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