Juggling Dynamite

As the bankers keep assuring the world that all is well–why are government bond yields nil to negative and central banks buying up dodgy debts all over the world then?–anyway, as the bankers push the ‘America is a self-sustaining engine of global growth’ meme, Dr. Copper appears to be cracking under the weight of weak demand. Today moving below $2.50 a pound, as it did last entering the 2009 recession, secular support lies some 40% lower in the $1.50/pound range.

Draghi rolled out his much threatened QE bazooka yesterday and global inflation expectations have plunged further in response. Commodities and North American yields are falling some more…

Belief in monetary magic may have felt fun while it lasted. Unfortunately after toxic injections of ‘stimulants’, global demand is now non-responsive.

Mario Draghi led the European Central Bank into a new era, committing to a quantitative easing program worth at least 1.1 trillion euros ($1.3 trillion) to counter the threat of a deflationary spiral. Here is a direct video link.

The fact is that a world of over-levered companies and economies are desperate for cash flow and so are ‘weak hands’ that will go down pumping out product even as prices plunge…

The world will never again see the price of oil at $100 per barrel, according to one of Saudi Arabia’s biggest investors. Prince Alwaleed Bin Talal Bin Abdulaziz Al Saud, the chairman of Kingdom Holdings, spoke with CNBC’s “Squawk on the Street” following the death of his uncle, Saudi Arabian King Abdullah. While he admitted that his country—which derives 90 percent of its budget from oil—is feeling the pain of the commodity’s collapse, he predicted that Saudi Arabia would not be the first to blink.  Here is a direct video link.