Tuesday, August 4, 2015

A Thank You to Bill Holter for Mention of the Systemic Risk Warnings List

Recently I added a new page on the blog which has a list of all the various systemic risk warnings that have been issued by the IMF and the Bank for International Settlements (BIS) over the past year or so. The response to this new page has been incredible. 

Jim Rickards and Willem Middelkoop were kind to put a link to the page on their twitter feed. Bill Holter just did a full article featuring the warnings list which you can read here (or here on Jim Sinclair's blog site). A big thank you to all of them for mentioning the list.

The purpose of this blog is to be a free information resource for anyone who can use the information presented here. The blog functions best when it serves readers in that way.

This list can be useful because it documents all the warnings from sources most people accept as credible and illustrates that there is legitimate concern within the system about risks that exist to the entire system.

On the one hand, it does show that the risks are recognized and efforts are being made to mitigate and manage the risks. This is useful to know.

On the other hand, the existence of the risks means that we as average citizens have to take some responsibility to be informed about them and to make some preparations in case the risks ever lead to a systemic crisis.

We are following that here as one of our two big questions for the future. Many highly credible analysts including Jim Rickards, Nomi Prins, Bill Holter and Willem Middlekoop expect a systemic crisis at some point. As we can see from the warnings list, the leading global financial institutions in the world have warned us about the potential as well.

None of us can know the future, but all of us can try to be better informed and have some kind of plan in mind to deal with a crisis if we do get one. There is nothing extreme about this. It's just common sense and is the same concept we use everyday regarding having insurance for our homes, cars, health, etc.

We owe a debt of thanks to those who try to keep us informed and encourage us to be prepared for a crisis. It's not rocket science. Being prepared is better than not being prepared. We will continue to follow it here on the blog to see what actually does happen and do our best to be a useful source of information.

Added note: 

The link to this new page has been re-tweeted so many times I cannot possibly thank everyone who did so individually. But I do very much appreciate it! The blog Independent Trader also carried an article about it which you can see here (the page has a translation option if you need it).

Other sites that carried it were SGTReport.com , Miles Franklin, and some others. Thank you to all of them!

In case you think not many people have an interest in this topic, the combined efforts of those listed above very quickly generated many thousands of hits to the page of links listing the systemic risk warnings.

People are interested in this and will listen. This list of links can be a useful place for someone new who wants to learn about these issues to get some background. If you see new articles about similar warnings, please let me know. I will keep the list updated and available online.

email:   lonestarwhitehouse@gmail.com

Added breaking news: We do have some interesting breaking news this evening. The IMF announced they are going to delay a decision on adding the Yuan into the SDR currency basket until at least September 2016. Reuters also reported it here. We will do a full blog post on what this may mean in coming days. Here is the relevant Q&A concerning the delay:

IMF Survey: Why is staff proposing an extension of the current SDR basket?
Tiwari: To put this in context, the current SDR basket expires at the end of this year. We are proposing extending the current SDR basket by nine months until September 30, 2016. This is in response to feedback from SDR users on the desirability of avoiding changes in the basket at the end of the calendar year and facilitating continued smooth functioning of SDR-related operations. An extension of nine months would also allow users to adjust to a potential changed basket composition should the Executive Board decide to include the RMB.
The proposed extension, which will be decided by the Executive Board later this month, would not in any way prejudge the timing of conclusion or outcome of the review.

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