Submitted by Stefan Gleason via Money Metals Exchange,
"The last duty of a central banker is to tell the public the truth."- Alan Blinder, former Federal Reserve Board Vice Chairman
The Federal Reserve Board finds itself back in a quandary of its own making. When Fed chair Janet Yellen pushed through an interest rate hike this past December, she confidently cited an "economy performing well and expected to continue to do so."
A group of British and American scientists have said that the world needs to prepare itself for global food shortages in the near future. Speaking at an annual meeting of the American Association for the Advancement of Science (AAAS), the scientists unveiled disturbing new research that suggests future extreme events could affect the global food system so dramatically that it will result in ‘food shocks’ across the world. Eurekalert.org reports: Food shocks have the potential to wreak havoc on food markets, commodity exports, and families around the world.
Earlier today, we discussed how after 8 long years spent wandering punch drunk through a dream-like Keynesian wonderland where all financial assets rise inexorably, the world finally woke up last month with a terrible hangover only to discover that after 637 rate cuts and $12.3 trillion in asset purchases, “quantitative easing” has been a “quantitative failure.”
After starting out strongly this morning, with DB stock trading just shy of $17/share, European banks have seen some weakness in the past hour following a report from Reuters, in which sources were cited as saying that there is "firm support for a deposit rate cut within the European Central Bank's Governing Council." While a year ago this would have sent European stocks soaring, this is no longer the case as explained by none other than Deutsche Bank last weekend:
As we have reported previously on various occasions things are bad for European banks: from DB's record wide 5Y Sub CDS, to Credit Suisse record low stock price, to everyone else inbetween. But did you know that for most European banks, 2016 is shaping up far worse than the dreaded 2008? As the following chart from Reuters shows, the year-to-date stock price performance for most European banks is on pace to far surpass - to the downside - the dreadful for the global financial system 2008.