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EU Faces Migrant Crisis of ‘Biblical Proportions’ as Germany Registers 3,500 New Refugees in Just One Day [+video]

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Migrants-police-of_3425550nBy Harriet Alexander and James Rothwell. A record 3,500 migrant arrivals have been registered in a southern border region with Austria since Monday morning, German federal police have said.

The arrivals have spiked as passenger trains, each packed with hundreds of refugees, headed from Hungary through Austria into Germany’s southern Bavaria state, a spokesman said Tuesday.

(skip forward to 11:30 in the below video to listen to an in-depth discussion of Europe’s immigration crisis)

It was the highest number recorded by any of Germany’s 10 federal police districts since the start of the migrant crisis that is expected to bring 800,000 newcomers to Europe’s top economy this year.

The numbers were registered by the Munich police district, which stretches from the Bavarian state capital down to the Austrian border, between 0600 GMT Monday and 1230 GMT Tuesday, the spokesman told AFP. (Read more from “EU Faces Migrant Crisis of ‘Biblical Proportions’ as Germany Registers 3,500 New Refugees in Just One Day” HERE)

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Canada Officially Enters Recession

By Michel Comte. Reeling from low oil prices, Canada fell into a recession in the first half of the year, government data confirmed Tuesday, putting Conservative Prime Minister Stephen Harper on the defensive in the run-up to October elections.

According to Statistics Canada, the economy contracted 0.5 percent in the second quarter after retreating 0.8 percent in the previous three months.

It is Canada’s second recession in seven years and it is the only Group of Seven nation in economic retreat. The figures are the weakest since the 2008 global financial crisis.

The data reflects fears about the health of the global economy as more gloomy evidence emerged of a slowdown in China, a main engine of growth worldwide.

Harper, whose Tories are trailing their rivals in opinion polls ahead of the October 19 election, blamed the overseas turmoil for Canada’s woes, and emphasized an expansion in the economy in June. (Read more from this story HERE)

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The World Is Defenseless Against the Next Financial Crisis, Warns BIS

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The world will be unable to fight the next global financial crash as central banks have used up their ammunition trying to tackle the last crises, the Bank of International Settlements has warned.

The so-called central bank of central banks launched a scatching critique of global monetary policy in its annual report. The BIS claimed that central banks have backed themselves into a corner after repeatedly cutting interest rates to shore up their economies.

These low interest rates have in turn fuelled economic booms, encouraging excessive risk taking. Booms have then turned to busts, which policymakers have responded to with even lower rates.

Claudio Borio, head of the organisation’s monetary and economic department, said: “Persistent exceptionally low rates reflect the central banks’ and market participants’ response to the unusually weak post-crisis recovery as they fumble in the dark in search of new certainties” . . .

Extraordinarily low interest rates are not a “new equilibrium” said Jaime Caruana, general manager of the BIS, rejecting the theory of so-called “secular stagnation” which some economists blame for the continued decline in global lending rates. (Read more from “The World Is Defenceless Against the Next Financial Crisis, Warns BIS” HERE)

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Another Financial Crisis Coming, Much Worse Than Last

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Photo Credit: Getty Images The bond markets will crash once global central banks stop buying debt, triggering a financial crisis much worse than the one seen in 2008, strategist David Roche told CNBC.

Roche, who has previously warned that “safe haven” government bonds are the most dangerous place for investors to be in, said Wednesday: “Yes it [a financial crisis] will happen and yes, it will be bigger [than the credit crisis]. Once you re-price the burden of the world’s debt… the ugly truth will be revealed.”

According to Roche, president of Independent Strategy, once the expansive quantitative easing programs initiated by Western central banks come to an end, sovereign bond yields, including U.S. Treasurys, German Bunds and U.K. Gilts, will spike significantly prompting a crash.

Yields on U.S. 10-year Treasurys have fallen more than 200 basis points over the past five years and are now around 1.8 percent. Meanwhile, U.K. 10-year Gilts and German 10-year Bunds were also trading near record lows on Wednesday at 1.8 percent and 1.29 percent, respectively.

“As long as the central bankers print money, the only way to have to distribute it is [for governments] to buy 70 percent of new bond issuance in these safe haven bond markets. As long as they go on doing that, the yields won’t go up, and the day they stop, the yields will go up by so much we will have a financial crisis on our hands,” he said.

Read more from this story HERE.

Financial Crisis Caused by Banksters on Cocaine, Says Former UK Drug Czar

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Photo Credit: Getty Images

The former Government drugs tsar, Professor David Nutt, has said the financial crisis was caused by too many bankers taking cocaine.

The controversial academic, who was sacked for claiming that ecstasy was as safe as horse riding, told the Sunday Times that abuse of cocaine caused the financial meltdown.

“Bankers use cocaine and got us into this terrible mess,” he told the paper adding that the drug made them “overconfident” and led to them taking more risks.

Nutt, who is professor of neuropsychopharmacology at Imperial College, claimed that cocaine was perfect for a banking “culture of excitement and drive and more and more and more. It is a ‘more’ drug”.

He goes on to claim in the interview that abuse of cocaine led to the financial meltdown, “and the Barings crash”.

Read more from this story HERE.

Cyprus Rejects Bailout Deal Leaving Eurozone Facing Fresh Crisis

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Photo Credit: Filip Singer

The Cypriot parliament has thrown out a controversial plan to skim €5.8bn (£5bn) from savers’ bank accounts, in a move that risks plunging the eurozone into a fresh crisis and heightens expectations that the cash-strapped country will seek a funding lifeline from Russia.

Cyprus has just 24 hours to find a solution to its funding gap before its banks are due to reopen following the dramatic no vote on Tuesday night, which failed to support a hastily renegotiated change to the original deal.

Late on Tuesday night the eurozone governments said that despite the vote Cyprus would still need to raise the €5.8 bn – a third of the €17bn bailout.

With the crisis escalating, an RAF flight carrying €1m in low-denomination notes landed in Cyprus to provide cash for 3,000 British service personnel based on the Mediterranean island. The banks have been shut since Friday and electronic transactions halted, although cash machines are still working and the Ministry of Defence said the euros were being flown in as “contingency measure”.

About 2,000 of the military staff, typically posted to the island for 18 or 24 months, have their salaries paid into local accounts. The MoD said it was “approaching personnel to ask if they want their March, and future months’ salaries paid into UK bank accounts, rather than Cypriot accounts”.

Read more from this story HERE.

Video: ‘Let America Get Back To Work!’ – Santelli Explodes During Panel Discussion On The Fed’s Easy-Money Policies

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Not one to shy away from voicing his opinion, CNBC’s Rick Santelli on Friday clashed with his colleagues over topics that included Quantitative Easing, unemployment, and Fed’s supposed plan to revive the U.S. economy.

Photo Credit: NPR“Five years into this crisis, I think it’s all disappointing,” Santelli said, referring to recovery’s slow pace. “It would take five years at the present job rate to get to where we were before the crisis.”

Indeed, as noted earlier on TheBlaze, although today’s unemployment numbers are heartening, there’s still a lot a work that needs to be done before we can get back to pre-recession employment levels.

“There is no crisis!” Santelli continued, taking issue with the Federal Reserve’s open-ended commitment to monthly purchases of $85 billion dollars worth of bonds. “Why they’re still in crisis mode is beyond belief and I think it’s wrong.”

“Rick,” CNBC senior economics reporter Steve Liesman interjected, “Some 7.7 percent of the population is unemployed. The U6 is 14.3 percent and that’s part of the problem there, Rick. There is a crisis! There’s a crisis of unemployment in this country.”

Read more from this story HERE.

Peter Schiff And The Coming Housing Collapse: The Fed, Instead Of Lehman, Owns The Mortgage Market

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Photo Credit: Wikipedia With market participants cheering a new all-time high in the Dow Jones, one man is predicting this “misplaced optimism” will lead to a “worse collapse than in 2008.”

Peter Schiff, the eternal provocateur, suggests the Fed’s extraordinary support of bond and housing markets will lead to a market crash as interest rates rise, leaving banks, mortgage originators, and lenders stuck with homes and low yielding loans as the economy slows, exacerbating the decline and throwing the economy into a deeper crisis.

Fed Chairman Ben Bernanke endured some hostile questioning in Congress last week. At one point, responding to a question about QE by Republican Congressman Lynn Westmoreland, Bernanke was explaining “[quantitative easing] doesn’t involve any new spending or revenue,” when he was cut off by Westmoreland, who said “oh, I got you, just money printing, right?” The Fed Chairman’s demeanor froze for a second, after which he continued “it’s acquiring securities in order to reduce interest rates and ease financial conditions in the economy,” tacitly accepting the “money printing” comment.

Precisely those purchases of assets to further ease monetary policy are cooking a bigger financial crash than in 2008, Peter Schiff of Euro Pacific Capital argues, and that collapse will start with the housing and bond markets.

Paradoxically, the housing market is firing on all cylinders, with homebuilders like KB Home and Lennar trading close to their 52-week highs. This is irrational exuberance, according to Schiff, as the market is fully subsidized by the Fed. “The U.S. government is guaranteeing all mortgages, and then buying them up,” explained Schiff, “it’s an artificial market, but the Fed, rather than Lehman Brothers, owns it.”

Read more from this story HERE.

Detroit Will Be Run by Financial Manager

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Photo Credit: Reuters
The state of Michigan is taking on one of the most difficult turnaround projects ever attempted: a rescue of a sprawling city with $14 billion in debt, a depleted tax base, a legacy of government corruption—and very little time left to avert financial collapse.

Republican Gov. Rick Snyder said Friday he plans to appoint an emergency financial manager for Detroit, taking control of the state’s largest city out of the hands of elected leaders. The governor, who has called a revitalization of Detroit critical to sustaining the state’s nascent economic recovery, said he didn’t believe city leaders were addressing rapidly enough Detroit’s ballooning deficits and a persistent cash drought.

At an invitation-only town hall at Wayne State University, Mr. Snyder called it a “sad day” that he “wished had never happened.” But he said that the emergency manager would also bring Detroit new promise. “It’s time to say that we should be moving forward,” he said.

City and state Democratic leaders opposed the governor’s move. “I am deeply disappointed by today’s hostile takeover of Detroit. We need to trust the democratic process, not throw it out,” said Lon Johnson, chairman of the Michigan Democratic Party, in a statement on Friday.

The governor’s decision represents a turning point for a city that was once the industrial capital of America and an engine of its growth. Six decades ago, Detroit was a city of nearly two million people brimming with factory jobs that offered immigrants from the South and abroad a pathway into the American middle class.

Read more from this story HERE.

Postal Service to Cut Saturday Mail

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Photo Credit: ABC OTUS NewsThe financially struggling U.S. Postal Service said Wednesday it will stop delivering mail on Saturdays but continue to disburse packages six days a week, an apparent end-run around an unaccommodating Congress.
The service expects the Saturday mail cutback to begin the week of Aug. 5 and to save about $2 billion annually, said Postmaster General and CEO Patrick R. Donahoe.

“Our financial condition is urgent,” Donahoe told a press conference.

The move accentuates one of the agency’s strong points — package delivery has increased by 14 percent since 2010, officials say, while the delivery of letters and other mail has declined with the increasing use of email and other Internet services.

Under the new plan, mail would be delivered to homes and businesses only from Monday through Friday, but would still be delivered to post office boxes on Saturdays. Post offices now open on Saturdays would remain open on Saturdays.

Over the past several years, the Postal Service has advocated shifting to a five-day delivery schedule for mail and packages — and it repeatedly but unsuccessfully appealed to Congress to approve the move. Though an independent agency, the service gets no tax dollars for its day-to-day operations but is subject to congressional control.

Read more from this story HERE.

Obama Holds Record for Four Largest Deficits in U.S. History

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In this corner, the challenger, representing the responsible adult who tries to balance his checkbook every month and to save money for his/her children so their future will be safe: The American Taxpayer!

And in this corner, the undefeated champion, representing the height of fiscal irresponsibility, the man who has presided over an unbelievable, unprecedented four straight years of the highest four national deficits in U.S. history; the man who will assure your children that their future has been stolen by their parents, the President of your United States: Barack Obama!

Okay, you two, come out fighting. And no low blows.

Yup, Barack Obama has now given us four years of deficits that were $1.4 trillion, 1.3 trillion, 1.3 trillion, and 1.1 trillion. There have never been deficits remotely approaching these; the last year of George W. Bush’s tenure, the deficit was less than half of a trillion dollars.

Read more from this story HERE.