Earlier today, CNBC invited Kyle Bass, the man who correctly predicted and profited from the subprime collapse, to discuss what he thought was the biggest threat to the global financial system.
http://player.cnbc.com/p/gZWlPC/cnbc_global
Here is the highlight of what he said:
Submitted by Lance Roberts via RealInvestmentAdvice.com,
This week has certainly been interesting with the Dow Jones Industrial Average having the worst start to a year…well…ever. Even more interesting is the culprit was primarily the collapse of financial markets in China.
Why is that interesting? Because it is exactly the issue that I wrote about during the summer of 2015:
Submitted by Jeffrey Snider via Alhambra Investment Partners,
The focus on China as if their problems were only Chinese is highly misplaced, though you can understand the appeal of the excuse. This sentiment was expressed over and over today (just as it was in August):
Moments ago, the Fed released the latest, November, consumer credit data: it was not good. Rising by just $13.95 trillion, it was a big miss to the $18.5 trillion expected, and below the $15.6 billion downward revised increase in October. In fact, three months after the historic surge in September to the highest print in the revised series, total consumer credit has tumbled to the lowest since January.
But the big problem was not in the total data, but in one of the two key component data sets.
“China Finds $3 Trillion Just Doesn't Pack the Punch It Used To,” a Bloomberg headline from Friday morning reads.
“China’s $3 trillion-plus in foreign currency reserves, the biggest such stockpile in the world, would seem to be a gold-plate insurance policy against the country’s current market chaos, a depreciating currency and torrent of capital leaving the country,” Bloomberg writes, before citing a number of sources who say that in reality, $3 trillion aint what it used to be.