by Andrew Hoffman, Miles Franklin:
Today (Monday), let’s start with the “horrible headline periphery”; i.e, topics ugly enough to single-handedly take the economy down – and markets, rigged or otherwise – but not “sexy” enough for the sensationalism seeking MSM to report on. Such as, for example, the dramatically worsening droughts in California and Brazil – which, as we discussed a year ago – are major exporters of some of the world’s most important, widely used agricultural commodities. It shouldn’t surprise anyone that Brazil’s economy and currency have collapsed – or conversely, that Real-priced gold has surged to within 1% of its all-time high. Heck, Brazil’s largest company, the massively corrupt, state-owned Petrobras oil company, was bailed out by the Chinese last month.
As for California, it was one of the most financially challenged states before the drought began – currently, holding $425 billion of debt, excluding more than $200 billion of “unfunded liabilities.” And that’s just at the state level; as countless cities, counties, and lesser municipalities are heavily indebted as well. Consequently, the potential economic ramifications on its 39 million citizens – let alone, the other 280 million Americans that must bail it out – could be catastrophic.
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