The IMF is now getting fearful that another Greek bailout might be a bad idea.
The International Monetary Fund has thrown the Greek bailout into jeopardy once again after it emerged that staff at the IMF are currently unwilling to take part in the new rescue deal.
Leaked minutes of the fund’s latest board meeting, which took place on Wednesday, showed staff “cannot reach agreement at this stage” on whether to take part in the new €86bn (£60bn) bailout for Greece…
The German Chancellor, Angela Merkel, only sanctioned a new Greek deal earlier this month on the condition that the IMF takes part.
This is a sign of the shift from lack of fear over consequences, to a more risk-averse attitude which presupposes that bad things might happen, and drives avoidant behaviors.
From the Burning Platform (Thanks for the link in the comments, DC!):
He’s an analytical investor who bases his thinking upon historical facts and valuation methods that have proven accurate over the last 100 years of investing. His two key principles on investing are flashing red. Corporate revenues and profits are falling. The attitude of investors regarding risk is shifting from greed to fear. With valuations at record highs, margin debt at epic levels, and professional investors extremely bullish, even the hint of fear will begin the collapse. It’s already happened twice in the last fifteen years and Hussman called the previous two collapses too.
And :
Risk-seeking and risk-aversion control returns over shorter portions of the market cycle. The difference between an overvalued market that becomes more overvalued, and an overvalued market that crashes, has little to do with the level of valuation and everything to do with the attitude of investors toward risk. When investors are risk-seeking, they are rarely selective about it. Historically, the most reliable way to measure risk attitudes is by the uniformity or divergence of price movements across a wide range of securities.
This is a sign of amygdalae beginning to warm up, recognize danger, and drive action to avoid it. This is a feed forward mechanism – the more the amygdala lights up, the more threats it will see. The more threats it sees, the more it will light up. As it takes off, bailouts will not happen, and then amygdalae will really light up. The fear of losing the money used will overwhelm the fear of seeing the good times come to an end. Then the violence will begin, and things will be taken to a whole new level.
The Economic Collapse Blog highlights several red flags here, and makes the case the next six months will be the beginning of the end:
#1 Puerto Rico is going to default on a 58 million dollar debt payment that is due on Saturday. Even though this has serious implications for the U.S. financial system, Barack Obama has said that there will be no bailout for “America’s Greece”.
#2 As James Bailey has pointed out, the most important trendline for the S&P 500 has finally been broken after holding up for six years. This is a critical technical signal that will likely motivate a significant number of investors to sell off their holdings in the weeks ahead.
#4 Italy is going down the exact same path as Greece, but Italy is going to be a much larger problem for Europe because it has a far, far larger economy. This week, we learned that youth unemployment in Italy has reached a 38-year high of 44 percent, and Italy’s debt to GDP ratio has now hit 135 percent.
#5 The Canadian economy has officially entered a new recession. This is something that was not supposed to happen.
And then you have these idiots speeding the approach of the end:
Carl Robinson, 26, believes there is nothing wrong with using his benefits to pay for sex.
Mr Robinson has been sponging off the system since he left his last job working in a bookmakers three years ago.
But he now spends almost all of his fortnightly £170 on seedy romps with hookers.
“I don’t care what people think about what I am doing, there are a lot worse people than me out there,” he said.
“I have spent over £10k of benefits on hookers, it is a lot of money but it is money well spent in my opinion.”
Note how in the violence and chaos to come, sex will be the last thing he will think about. Nothing stops you from feeling randy like a mob of savages with weapons, chasing you down to kill you. There is a reason nature centralized both sex drive and threat awareness in the same brain structure. Under the r/K model, they change together.
We may be closer to the tipping point than logic or reason would indicate.
Apocalypse cometh™
