Tag Archives: Mish/ Mike Shedlock

Mish/ Mike Shedlock – Supersaturation And Store Cannibalization: McDonald’s To Close 700 Stores, 350 Already Took Place First Quarter – 25 April 2015

MishMikeShedlockMcDonald’s is closing 700 stores this year, 350 of which took place first quarter. That sounds like a lot but it pales in comparison to the 32,500 stores in the chain.

Still it is a sign of Multiple Problems for McDonald’s

On Wednesday, McDonald’s had reported an 11% decrease in revenue and a 30% drop in profit for the first three months of year, a continuation of its troubles in the last two years as it has struggled to compete with new U.S. competitors, a tough economy in Europe and a food safety scare in Asia. Continue reading

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Mish/ Mike Shedlock – Iceland Ponders Radical Money Plan Including Elimination Of Fractional Reserve Lending And Deposit Insurance – 1 April 2015

MishMikeShedlockI have long railed against fractional reserve lending, duration mismatches (e.g. banks issuing 2-year CDs and lending money for 15-year mortgages), bank’s ability to lend money into existence, and deposit insurance.

Fractional reserve lending allows banks to lend out a near infinite amount of credit with essentially no backing. Money inevitably creates asset bubbles, but as long as the bubbles are expanding it appears the system is solvent.

Money that depositors believe is available on demand in their checking accounts is not actually present at all. And banks are not required to hold any reserves on savings accounts at all.

Deposit insurance is the epitome of moral hazard. It guarantees money will flow to banks offering the highest yield. Of course, banks offering the highest yields on deposits need to take the highest risks to be able to pay that interest. Depositors do not care because the deposits are insured. Continue reading

Mish/ Mike Shedlock – SNB Warns Of “Temporary Deflation”, Promises Further “Unconventional Measures” Including Forex Interventions To Achieve “Stability” – 27 March 2015

MishMikeShedlockUnconventional Yields

Swiss Bonds are negative out to 10 years. They briefly went negative out to 15 years in the wake of the sudden removal of the Swiss National Bank peg to the euro back on January 13 as shown in the following chart.

Swiss 15-Year Bond Yield
image: https://lucas2012infos.files.wordpress.com/2015/03/1e38b-swiss2b15-year.png?w=300

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Mish/ Mike Shedlock – Cash Dinosaur: France Limits Cash Transactions To €1,000, Puts Restrictions On Gold; Bitcoin End Coming? – 19 March 2015

MishMikeShedlockA few days ago I asked How Long Before Cash is Banned?

My question was in reference to reader CNA (Cards Not Appreciated) who commented …

Hi Mish

I’ve been in Italy for a month. It’s quite amazing how many places ask you to pay cash. Even at hotels, they would like you to pay your €1000+ bills in cash. And people ‘wonder’ why these countries always get into trouble.
CNA

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Mish/ Mike Shedlock – Greece Accuses Spain And Portugal Of Conspiracy; 3Rd Greece Bailout Discussion Under Way For €30-50 Billion – 3 March 2015

MishMikeShedlockNow that Germany has agreed to an extension, allegedly with no more money on the table, Spain confirms what we all knew would happen, Third Greek Bailout Under Discussion.

Euro zone countries are discussing a third bailout for Greece worth 30 billion to 50 billion euros, Spain’s economy minister said on Monday, as Athens sought to quell fears it might run out of money before the end of March.

Speaking at an event in Pamplona, in northern Spain, Economy Minister Luis de Guindos said the new rescue plan would set more flexible conditions for Greece, which had no alternative other than European support. Continue reading

Mish/ Mike Shedlock – Recession is On the Way: Questioning One’s Sanity; Beat the Crowd, Panic Now! – 27 February 2015

MishMikeShedlockIn 2006-2007 I called for a recession. We got a big one. I called for another one in 2011, as did the ECRI. That recession never happened.

50% is not a very good recession predicting track record except in comparison to consensus economic opinions that have never once in history predicted a recession. Consensus opinion is batting a perfect 0.00%

Investigating the Record

By the way, the ECRI was late in calling the recession of 2007. They still deny it. And questions regarding the 2001 recession and ECRI have still not been answered. Continue reading

Mish/ Mike Shedlock – Greek Negotiations and Philosophical Questions – 16 February 2015

MishMikeShedlockThree interesting philosophical questions have arisen this evening in regards to Greek negotiations.

The three questions I ask at the bottom of this post are based on statements made by a global foreign exchange strategy chief at UniCredit bank and two negotiation demands by Greek Prime Minister Alexis Tsipras.

I highlighted in red and italics the source of my questions. Stop at the questions and think about your answers before reading further.

Greece Rift Wider Than Expected

As an 11th hour meeting between Greece and creditors takes place on Monday. But a larger than expected Gap Still Yawns Between the Parties.

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