Archive for interest rates

Window of Opportunity to Refinance?

Posted in #PaulthePoke, Michael Douville, Trend Update with tags , , , , , on May 6, 2019 by paulthepoke

Ecclesiastes 7:12 For the protection of wisdom is like the protection of money, and the advantage of knowledge is that wisdom preserves the life of him who has it.

Proverbs 27:23 Know well the condition of your flocks, and give attention to your herds…

Be vigilant and protect your resources. The economic cycle appears to be winding down. The yield curve on interest rates has inverted. Position yourself now to grow your wealth. There is a window of opportunity to refinance. Michael discusses the next 12-18 months of the business cycle and how to position yourself for an economic slowdown. Michael also has a plan on navigating the business cycle once the slowdown is over. Do you have a plan?

http://www.michaeldouville.com

Put yourself in a financial position to be a lender instead of a borrower.

Proverbs 22:7 The rich rules over the poor, and the borrower is the slave of the lender.

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Is Turkey the “Catalyst” that Breaks the World?

Posted in #PaulthePoke, Ezekiel 38-39, Trend Update with tags , , , , , , , , on April 1, 2019 by paulthepoke

Isaiah 47:11 But evil shall come upon you, which you will not know how to charm away; disaster shall fall upon you, for which you will not be able to atone; and ruin shall come upon you suddenly, of which you know nothing.

Pay Attention!!!

By Michael Douville – I have forecast the Global Slowdown and now that fact has been recognized by virtually everyone. The Globe is slowing so quickly that the World may be entering a period of vulnerability to a sudden downdraft.

To paraphrase the famous question of “how does this happen?”: slowly, then all of a sudden! The economy has been dragged to the edge of a cliff; something just needs to push it over!

https://michaeldouville.com/

The last decade of repressed interest rates has encouraged a Global Debt Binge!

Italy is in Recession, The Netherlands is also. Germany is teetering avoiding a the statistical recession as the 3rdQuarter GDP was -0.2% but the 4thQuarter managed to rise to 0.0%. Revisions later may change the statistics.

The 1stQuarter of 2019 is looking dismal as Global demand for Autos declined and mighty BMW announced it will not make earnings projections. The stock dropped over 6%.  Lower earnings = lower stock prices!

More bad news for Germany as several Economic Indices are severely declining and the European Industrial powerhouse may be heading into further trouble. As Germany’s trading partners suffer, so suffers Germany as the German Economy is certainly Export driven. 

European Interest Rates have been driven into negative returns forcing European Banks to search for better yields in Sovereign and Corporate Debt. Many Spanish, Italian, and German Banks have still not recovered from the Great Financial Crisis and are “woefully unprepared” for the next financial crisis and the currency union is not resilient enough to emerge unscathed from unexpected economic storms” as reported by Christine Legarde.

Which brings us to Turkey! The last decade of repressed interest rates has encouraged a Global Debt Binge! Not only has business and private borrowers indulged beyond their capacity, but Nations across the World have found that it was very easy and expedient to borrow their way to Prosperity!

Turkey is in trouble! The Turkish Economy has officially entered a Recession. Inflation has been unleashed on the population driving prices of everyday goods beyond reach. The Turkish national currency the Lira has lost tremendous value as the Foreign Exchange rate, although improved from the near 7 Lira to the US Dollar, is still vastly devalued at 5.75 Lira to the US Dollar. To make matters worse, the US Dollar is cycling higher. Portending Turmoil!

Debt denominated in US Dollars is now coming due; Billions and Billions of US Dollars are coming due all while the Lira sinks and the Nation of Turkey is gripped by a Recession. Much of this debt is owed to the Banks of Spain, Italy, and Germany;  Banks that are “ill prepared” for Loss!! Banks that are “Systemically Important”!

Could Corporations in Turkey, struggling with Debt Repayment default on their loans? For that matter, could Turkey default on it’s Sovereign Debt? A Turkish default could lead to losses in Systemically Important Banks; losses now, while Europe struggles, would be felt everywhere!!! 

As I have recommended before, build reserves, pay down debt, cut expenses, review vulnerabilities both personal and Business, and discuss with your advisers as to what is Prudent in your Investment Portfolio. If contagion ignites, financing will be restricted; check with your lenders and review loans for refinance and Lines of Credit. Preserve Capital for the huge Opportunities that will surely present themselves. Review rental agreements and maximize tenant quality rather than maximize revenue. Rental cash flows may be the “Life Boat” to sustain the quality of life jeopardized by a Global Recession.

https://michaeldouville.com/

For more detail linking modern day Turkey to ancient Meshech, Tubal, Gomer, and Beth Togarmah, see the link below.

https://godinanutshell.com/2017/08/08/ezekiel-38-who-are-meshech-tubal-gomer-beth-togarmah/

The Catalyst for A Global Default

Posted in Michael Douville, Trend Update with tags , , , , , , on November 26, 2018 by paulthepoke

Proverbs 22:7 The rich rules over the poor, and the borrower is the slave of the lender.

world under water

https://michaeldouville.com/

Spend, Spend, and Spend some more; we borrowed some and we can borrow more!  Since the Great Financial Crisis, virtually every Nation, State, County,  Province, Region, City, Town, Village, and two buildings near each other on the same road have gorged on Borrowed Money.  The Central Banks of the World opened the Debt Spigot and flooded the Globe with Liquidity.  It is oh so much fun when the spending is free. Everyone loves a “Big Spender”! Now the Credit Splurge is over and reality is setting in.  Much of the Debt was squandered by bureaucrats that had no economic sense; spending on projects for local constituents that benefited political support groups to consolidate and retain power. Sometimes just outright Fraud and Graft.  Some Debt was used to build Schools, Roads,  and power Infrastructure, but too much was misspent and mal-invested by the totally incompetent but politically connected technocrats in the Corporate and Government worlds.

Larger than all the stock markets of the World, the Debt Implosion will cause massive Disruptions and Turmoil.  Those that prepare will have enormous opportunities as assets are sold at discounted prices to satisfy loans.

Those middle managers that 10 years ago were still in School and have never experienced any Business Environment other than an expanding Credit Bubble will be bewildered as a Global Slowdown unfolds. No one told them that Loans will come due and need to be paid. No one told them Interest Rates can rise and rise quickly, No one told them that Debt cannot always be “Rolled Over’!  No one told them Business Cycles end! No one told them, therefore, it is not their FAULT!

Politicians and Corporate insiders will not accept the blame as the Debt Time Bombs start to threaten.  The Budgets that are trimmed and the Programs that are reduced or curtailed will become someone else’s fault particularly as Civil unrest starts, as local housing, medical, or food benefits are reduced or worse yet, eliminated! It will be someone else’s fault; either a Foreign enemy or a domestic Ethnic or Religious group will be blamed for mishandling the Economy.  Border skirmishes or outright conflict may result as Governments look to deflect and distract. Enemies do not deserve to be repaid!

Goldman Sachs has been embroiled in Corruption across the World and has been accused of creating complicated Financing for Nations such as Malaysia and Greece that provided funds to desperate politicians at very expensive prices,  good for the immediate term, but not so good when the Debt needs to be repaid.  Abu Dhabi filed suit in New York November 21, 2018 accusing Goldman Sachs of Bribery and Money Laundering.  Sovereign and Corporate Debt is at Risk of Default from Rising Interest Rates and Market Forces; now Sovereign and Corporate Debt is at Risk of Default due to alleged Fraudulent practices. Obviously, if the Money was Fraudulently lent, no one would expect to be paid back, would they?

The Bond Market will experience huge defaults and Global Deflation as Trillions of dollars come due; the Debt is not sustainable. Larger than all the stock markets of the World, the Debt Implosion will cause massive Disruptions and Turmoil.  Those that prepare will have enormous opportunities as assets are sold at discounted prices to satisfy loans. Essential Cash Flow from Bonds can be replaced often by even larger Income Streams from conservative Rental Real Estate in the great growth markets of the US with much less Risk. A discussion with a Financial Adviser may be Timely and Prudent.

https://michaeldouville.com/

 

Turkey is selling Gold!

Posted in Ezekiel 38-39, Michael Douville, Trend Update with tags , , , , , , , , on September 24, 2018 by paulthepoke

Featuring: Michael Douville, Paul Lehr

Ezekiel 38:1-3 The word of the Lord came to me: “Son of man, set your face toward Gog, of the land of Magog, the chief prince of Meshech and Tubal, and prophesy against him and say, Thus says the Lord God: Behold, I am against you, O Gog, chief prince of Meshech and Tubal.

Ezekiel 38:6 Gomer and all his hordes; Beth-Togarmah from the uttermost parts of the north with all his hordes—many peoples are with you.

The brothers of Magog (Meshech, Gomer, and Tubal) appear to point to modern day Turkey.

For more evidence pointing to modern day Turkey, see the link below.

https://godinanutshell.com/2017/08/08/ezekiel-38-who-are-meshech-tubal-gomer-beth-togarmah/

 

https://michaeldouville.com/store/

Economic data provided by Wall Street Geek syndicated columnist Michael Douville.

Turkey loves Gold! Gold is revered as true Wealth; portable and exchangeable worldwide. Turkey is one of the top Sovereign holders of Gold and the Turkish people consume massive amounts in jewelry and bullion. Turkey is selling Gold; over $6 billion US Dollars worth since June of 2018. Reports of up to 20% of Turkish holdings have been liquidated. Turkey loves Gold; there has to be compelling reasons to sell!

Turkey is in Trouble; big Trouble. The Turkish Lira is continuing it’s decline against the Euro and most notably the US Dollar losing over 40% of purchasing power year to date. The 10 year Turkish bond has climbed to unsustainable levels of over 21% and the Bank Rate has been increased to 24%+.  The Debt binge that has fueled Prosperity for the last decade is coming to an end; the Credit Line is exhausted! The Day of Reckoning when lenders will no longer extend a financial lifeline and want their money back is upon them. When the obvious loss of confidence in the Government’s credibility becomes apparent, Capital Flees! Not just Foreign Capital, but Domestic as well seeking safer assets. Selling Gold is inevitable and an International Black Swan.

Uncertainty dictates caution. The US will be the Haven of Last Resort; US Assets may still rise as others fall. Capital will search for safety.

Regardless what it is called, when a country can no longer service it’s debt, a Contagion ripples across the Globe. Turkey is connected to the European Banks; particularly fragile are those in Spain and Italy which have very little reserves to handle a default. The Fractional Reserve System on which modern Banking is based is intertwined with the International Monetary System and can destabilize the Banking System as Liquidity from defaults disappears. Turkey has a liquidity problem itself and selling Gold will temporarily ease the problem.  Servicing an unsustainable debt load by some reports of up to $330 Billion US Dollars with a currency that is daily losing value. A Herculean task.

Military forays into Iraq and now occupation of areas in North Syria are hugely expensive, not only in the loss of life and the loss of equipment, but the logistics to support the military campaigns; Turkey obviously has a finite capability. Who will provide the fuel, the food, the ammunition? Russia may be funding the incursions to benefit it’s Syrian ally. Russian capability is also limited.

Uncertainty dictates caution. The US will be the Haven of Last Resort; US Assets may still rise as others fall. Capital will search for safety. Prudence also dictates caution.  Review asset allocations; pay particular attention to Sovereign Debt Funds and Emerging Markets. Review vulnerabilities, review risk parameters in any new ventures, review debt and reduce negative cash flow,  build reserves and personal items such as extra food, water, medicine, and cash. Intrinsically, Real Assets may become more valuable than Financial Assets. Businesses may be vulnerable as commerce slows; first overseas then to Mainland US. Basic rentals (B- or C) with little or no frills should continue to provide an alternate source of consistent positive cash flow that will be hugely valuable during any International or Domestic Economic slowdown.

https://michaeldouville.com/store/

 

Will Turkey Align with Russia?

Posted in Ezekiel 38-39, Michael Douville, Prophecy, Trend Update with tags , , , , , , , , , , , , , , , , , on September 10, 2018 by paulthepoke

Featuring: Michael Douville, Paul Lehr

Ezekiel 38:1-3 The word of the Lord came to me: “Son of man, set your face toward Gog, of the land of Magog, the chief prince of Meshech and Tubal, and prophesy against him and say, Thus says the Lord God: Behold, I am against you, O Gog, chief prince of Meshech and Tubal.

Ezekiel 38:6 Gomer and all his hordes; Beth-Togarmah from the uttermost parts of the north with all his hordes—many peoples are with you.

The brothers of Magog (Meshech, Gomer, and Tubal) appear to point to modern day Turkey.

For more evidence pointing to modern day Turkey, see the link below.

https://godinanutshell.com/2017/08/08/ezekiel-38-who-are-meshech-tubal-gomer-beth-togarmah/

For evidence pointing to modern day Russia, see the link below.

https://godinanutshell.com/2017/08/04/ezekiel-38-who-is-magog/

Modern day, 21st century Russians refer to themselves as the ancient Scythians or Magogians. See the link below.

https://paulthepoke.com/2017/08/23/trend-update-putin-netanyahu-meet-in-sochi-russia-august-2017/

https://michaeldouville.com

No Presidential Decree from Turkey’s de facto ruler will stop the Lira’s decline against the US Dollar.

Nations are no different than Families; each has a credit line. Using credit to enjoy today is always at the expense of tomorrow; maybe at the expense of a lot of tomorrows.

The US Dollar is cycling higher as uncertainty in Financial Markets starts to spread; just Capital looking for Safety! The easy credit and absurdly low interest rates of the last decade have encouraged gorging on Debt across the Villages, Hamlets, Towns, Cities, and Nations of the World. The Joy of Financed Prosperity is ending and the Day of Judgment is coming as the servicing of the Debt now is impeding Prosperity and the Creditors are looking for re-payment. Emerging Markets rely heavily on Debt to finance schools, airports, roads, water sanitation and all of the infrastructure already in place in modern countries. Further, Emerging Markets rely heavily on Foreign Investments for Capital to build retail, restaurants and housing. When local currencies start to decline against the benchmarks such as the US Dollar, these pools of Capital start to leave causing a liquidity problem for local governments and eventually a loss in confidence which can quickly and adversely affect exchange rates. Capital in Argentina, Brazil, India, Greece, Macedonia, Poland and of course Turkey is fleeing to the Safety of the US Dollar and their currency’s purchasing power is declining. Once started, it is very difficult to stop: even Presidential decrees do not work.

                                  JP Morgan Emerging Market Currency Index

Nations are no different than Families; each has a credit line. Using credit to enjoy today is always at the expense of tomorrow; maybe at the expense of a lot of tomorrows. Eventually the credit line is completely spent; maybe an extension or two will postpone the inevitable. However, just as Families, nations can only service so much Debt and then something has to change. Families can declare Bankruptcy or allow a Foreclosure. Nations DEFAULT!!

Before a Nation Defaults, plans must be made for the continuation of the Government and essential services. This is done by securing funding from other sources; sources that previously would not even be considered; desperation changes things! Turkey is running out of Credit! Turkey will not accept constraints imposed by the IMF or creditor Banks and has received an emergency $15 Billion from Qatar.  The Debt must be addressed while the Turkish economy and currency is quickly declining creating a very difficult situation.  Overtures to Russia and China for funding will be a game changer. If the future funding requirements can be obtained, Turkey will be able to default on it’s Debt; geopolitics are also economic realities. Capital is fleeing now, time is short.

Prepare for Turmoil, but also prepare for opportunity! Defaults in Emerging Markets would impact Stocks and Bonds across the Globe.  Reduce or eliminate debt, create personal reserves, stockpile needed medicine, store extra food and water, and keep personal cash handy. The Financial Asset Cycle is ending and Real Assets will rise. Natural Resources, Agriculture, Mining and Minerals, Lumber, Copper, Oil, Aluminum, and most if not all of the basic materials should rise as currencies decline. Things should be accumulate; very conservative Real Estate such as rental houses should do well. It is time to prepare, time to change,  time to prepare for the next opportunity.

 

Currently, American economic sanctions and a strong US dollar are crippling the currencies of Russia, Turkey, and Iran. All of these countries are feeling an economic, monetary squeeze. Ultimately, the reason for the invasion of Israel from the north appears to be economic. Israel is a prosperous country.

Ezekiel 38:13 Sheba and Dedan and the merchants of Tarshish and all its leaders will say to you, ‘Have you come to seize spoil? Have you assembled your hosts to carry off plunder, to carry away silver and gold, to take away livestock and goods, to seize great spoil?’

Is now this time? It is looking like it more and more with each passing day. But, that remains to be seen. Will Turkey Align with Russia? God’s prophet Ezekiel says emphatically “Yes”!

 

Turkey Debt Problems

Posted in Ezekiel 38-39, Michael Douville, Prophecy, Trend Update with tags , , , , , , on July 23, 2018 by paulthepoke

Ezekiel 38:1-3 The word of the Lord came to me: “Son of man, set your face toward Gog, of the land of Magog, the chief prince of Meshech and Tubal, and prophesy against him and say, Thus says the Lord God: Behold, I am against you, O Gog, chief prince of Meshech and Tubal.

Ezekiel 38:6 Gomer and all his hordes; Beth-Togarmah from the uttermost parts of the north with all his hordes—many peoples are with you.

 

Featuring Michael Douville

Turkey’s debt is getting worse. Click on the video link below for the report on Turkey’s rising interest rates and growing debt. How will this affect global economics? Will it impact the United States? Will it affect your pocket book?

 

Magog was a son of Japheth. Genesis 10:2 The sons of Japheth were Gomer and Magog and Madai and Javan and Tubal and Meshech and Tiras. Japheth was the son of Noah. The sons of Japheth were born after the flood (Genesis 10:1).

The Bible and ancient historians point to the fact the land of Magog is modern day Russia. See attached post.

https://paulthepoke.com/2015/01/07/trend-update-russia-magogisrael-ezekiel-38-39-january-2015/

But what about the brothers of Magog? They include Gomer, Meshech, and Tubal.

Gomer means “complete”. Historians through the ages debate whether they lived north or south of the Black Sea. North of the Black Sea is modern day Russia. South of the Black Sea is modern day Turkey.

Meshech means “drawing out”; a people on the borders of Colchis (the land area east of the Black Sea). Armenia is effectively modern day eastern Turkey. Today, the region of Meshech is modern day Turkey, Russia, and Georgia.

Tubal means “thou shall be brought”; a region in east Asia Minor (modern day Eastern Turkey).

Beth Togarmah: Beth is Hebrew for house. Togarmah means “thou will break her”.  People consider this to be Armenia. At its peak, the Armenian Empire was from modern day Syria on the Mediterranean Sea to south of the Black Sea and east to the Caspian Sea. Historically, Turkey is also known as the House of Togarmah.

Definitions are from Strong’s Concordance. Historical evidence from Google images, Wikipedia.

The brothers of Magog (Meshech, Gomer, and Tubal) appear to point to modern day Turkey.

Russia will be joined by several countries in their future invasion of Israel (Ezekiel 38-39). One of those countries is modern day Turkey.

 

michael@michaeldouville.com

https://michaeldouville.com/

The Next Recession will be EPIC! Featuring Michael Douville

Posted in Michael Douville, Uncategorized with tags , , , , , , , , , , , , , , , , , , on May 24, 2018 by paulthepoke

Ecclesiastes 3

1 For everything there is a season, and a time for every matter under heaven:

2b a time to plant, and a time to pluck up what is planted;
3b a time to break down, and a time to build up;
5a a time to cast away stones, and a time to gather stones together;
6 a time to seek, and a time to lose; a time to keep, and a time to cast away;
7 a time to tear, and a time to sew…

MichaelSomething has changed! A Global down turn is underway; it can be seen in the Industrial statistics, the”Yield Curve” Spreads, the Baltic Dry Index. The slowdown can be seen in declining  Home Mortgage Applications and increasingly higher Auto loan delinquencies;  much, much higher credit card debt with slower repayments. Not surprisingly, the Spring Real Estate market in many regions of the US are exhibiting slowing sales when Property sales should be seasonally expanding. These are all signs of an aging Business Cycle.

This happens in Free Markets; it happened in 2010, 2012, and a longer decline in 2015. Each decline was met with Global Central Bank interference in the form of massive Liquidity injections via purchases in the Equity Markets and massive purchases of all forms of Bonds and Debt Instruments. Maybe a not so “Free market”.

Something has changed! Instead of ZIRP (zero interest rate policy), rates are rising! Instead of Massive Global Central Bank purchasing in a declining market, the Federal Reserve is actually selling! In April of 2017, the Central Banks were purchasing at the rate on $1.7 Trillion Dollars; tapering in April 2018 to an alleged big fat ZERO! The ECB is still caught supporting the European Markets as is the Bank of Japan for the Japanese Markets. The simple reason is that no else is willing to enter theses markets; no one entering at the current reduced and manipulated rates!

Something has Changed! Without the Financial Credit Pulse of coordinated Global Central Banks, Volatility and RISK have reappeared. The support has been removed and The Federal Reserve has announced not only are they NOT purchasing, but they are selling; $8 Billion Feb 5, 2018 alone. It is time to Pay Attention!!!

Recession-ahead

Your Wealth is at Risk! Americans 55 years and older  have a 70% of their Nest Egg in the Stock Market and 20% in the Bond Market; rising rates devastate Bond Funds! Those approaching retirement age are not “in it for the long Haul!” There is not enough time to recoup losses before the funds are needed.  There are times to be Aggressive and times to be Conservative; the Fed has transparently announced their intentions. This may be a time to be very conservative. In fact, one does not need to be fully invested 100% of the time. Without support, the Markets are free to act the way Markets are suppose to act. The next downturn could be EPIC!

Something has changed! Your Future is at stake! Now might be a very appropriate time to review your goals and concerns with your Financial Professional. Maybe an “Exit Strategy” should be developed with a goal to transfer into different asset classes.

https://michaeldouville.com

michael@michaeldouville.com

 

PaulthePoke

Prophecy Watch & Bible Study

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