The developing Epocalypse will become the super-volcano of economic history, and this week revealed cracks in the surface that give hints of the eruption to come.

It was a week of crumbling throughout global stock markets that has challenged records. Thursday, Hong Kong stocks suffered their worst start of a Chinese New Year since 1994 in a day of monkey business for the year of the monkey. Traders fled falling stocks and took cover in safe-haven investments, bringing the Hang Seng index down 742 points (3.9%).

Concern is that China’s banking problems could break out into financial upheaval eight times more devastating than the economic crisis the US experienced in the Great Recession. Some are estimating Chinese bank failures are likely and could result in a further 30% drop in the value of the yuan against the US dollar.

Japanese stocks went into free fall for an entire week, cratering more than 900 points in one day, then falling another 760 shortly thereafter. What a testimony to the disastrous and immediate failure of negative interest rates, which kicked Japan’s market into a full-blown panic.

Nevertheless, central banks in their groupthink manner still believe negative rates will seal the globe’s economic cracks and stop the volcano from exploding, though I am certain they will make things far worse because the very concept is evil, stripping money away from people for giving banks the privilege of holding and investing their money.

Major bank stocks continued to crash into the caldera with Deutsche Bank’s breakaway looming larger because negative interest rates in Germany are creating fissures in already weak banks. If Deutsche Bank fails entirely, it will take many other banks out with it in a domino effect. We’re right back to too-big to fail, but this time the risks and likelihood are global in development.

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Civilization seems to have no concept of the peril it has created for itself, but this past week gives us a glimpse of the forces that are brewing beneath the surface. Many people may think I make these statements for effect, but I believe that, in the end, they will not appear as overstatements at all. They will simply look factually correct wind up on the other side of these events in a completely different world.

Investors run for cover in safe havens

On Thursday, treasuries in the US hit their lowest yield since the end of 2012 when the Treasury’s money presses were heating up their bearings. Investors are now fleeing to treasuries, more than willing to accept lower yields. Megacorp Pimco stocked up, increasing its Total Return Fund from 22% investment in US debt to 26%.

Also read : Destitution, Death, Looting, Mob Rule, And A Complete Breakdown Of Law & Order. That’s What’s Happening When TSHTF [VIDEO]

US bonds attracted investors with 1.65% yields. However, Germany and Japan did much better, financing their debts at 0.2% and 0.02% respectively due to their push into negative interest rates.

Gold surged around the world on Thursday with lines around the block, pushing prices up 4% higher in London, easily breaking well above that $1,200/oz level that gold hasn’t seen in years (about $1,240/oz midday). With bullion rising 19% for the year, gold is entering bull market territory. The lowering yield on US treasuries made gold a more attractive safe haven. Other precious metals also rose this week.

Where China restricts outflow of capital from the nation, people are particularly buying gold as their vehicle for fleeing the crashing Chinese stock market. Chinese demand for gold grew 25% in the final quarter of last year (y on y). India is another place where people are most likely to move to gold jewelry when the economy is falling. (They can save their money, please their girlfriends or wives and enjoy wearing their saved wealth. So, more bangles, bobbles and golden beads.) So, gold purchases grew in India this week, too, as the financial crush is felt around the world.

Said JP Morgan on Thursday, “It’s hard to imagine an uglier morning.” Bankers hate to see gold rise because its the biggest threat to their own proprietary product on which they have national monopolies — money! Thus, an outstanding morning for gold was a hangover for JP.

Bank stocks took some of the worst hits this week due to pressures created by negative interest rates imposed on banks as a cost they have a hard time passing along. The cracking up of banks stocks made for Thursday morning’s humming heads, but there was no coffee and no aspirin for the banksters. (Banks stocks have fallen more than twice as fast as the S&P 500 this year, with Bank of America taking another 6.5% hit on Thursday.)

One can only imagine another central bank dump of gold is coming through a proxy somewhere soon to take the fire out from under the gold smelters. Why else do central banks own so much of the thing they claim is a poor investment, except to mitigate the threat of their product’s main competitor?

A bad day for banksters is a good day for me, though, regardless of its impact on the economy. Makes me want to sing my tribute to Bank of America.

Read The US Deception. The next financial collapse will resemble nothing in history. . . . Deciding upon the best course to follow will require comprehending a minefield of risks, while poised at a crossroads, pondering the death of the dollar.

Central banking crisis becomes evident

Markets did not seem much calmed by Chairwoman Yellen’s comments to congress this week that the Fed will remain accommodative if necessary in the face of global headwinds to the US economy but won’t be leaping to drop interest. As I said at the beginning of the present upheaval, there is no chance the Federal Reserve will act quickly to lower interest rates, having waited two years to try to find a window of opportunity to raise them and having finally found one barely wide enough to get their fingers through.

Yellen also said she saw no legal reason the Fed could not follow other central banks in imposing negative interest rates on the reserve accounts of national banks as a way to pressure banks to loan money, but she did say the Fed needed to further study the legality of a negative interest rate policy (NIRP) before taking such action. Trepidatious markets found her comments less soothing than what they were yearning for, as Yellen continues to ween them off Fed milk.

So far, nations with central banks that have imposed negative interest rates, have received little bang for the buck or pop for the pound or yelp for the euro or whatever. That makes such policy look ineffectual and extremely desperate right out of the gate. In part because of such interest rates, bank stocks in Europe fell 6% Thursday, making them the worst performing sector of the Stoxx. Losses, year-to-date have been 28% — the lowest they’ve been in years.

Sweden’s central bank, Riksbank, chose to step deeper into NIRP this week.

US Stocks in bondage

US bank stocks also took heavy hits again, falling by 3% on Thursday. Twitter slumped to an all-time low as it struggles to figure out what is supposed to be without alienating its twits. Twitter has crashed by 35% in the month and a half gone by this year. (Frankly, I’ve never seen the appeal, as I think the website’s sound bytes look hideous, being as full of tweety codes as they are.)

US media-company stocks also experienced their worst week since the flash crash of August. Subscribers are simply moving away to other alternatives, just as with Twitter and with retail stores.

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The Dow ended down 10% for the year on Thursday and the S&P down 10.5%. The Dow recovered Thursday’s drop on Friday, but overall US stock investors have averaged a loss of $57 billion dollarseach day of this year. That adds up to a $1.78 trillion loss in six weeks, equal to the entire GDP of Canada!

It seems more like contagion. What started off as, really, a healthy correction has turned into an oversold situation with some elements of panic.

That was Kristina Hooper, U.S. investment strategist at Allianz Global Investors, talking to CNBC.

I wouldn’t put that last spin on it of being oversold. I think the market has a lot of selling yet to go before it gets back in touch with reality. Earnings appear to be falling as quickly as stock prices, so the price-earnings ratio may not be improving as much as Hooper thinks, even as prices tumble into the caldron of the Epocalypse.

Dennis Gartman, I see, agrees:

I don’t think there’s too much selling at all…. Sovereign wealth funds are clearly in the process of liquidating…. This is very serious, and I think there’s going to be even more selling going on. I’m afraid it’s going to get even worse. I hate to say that. There’s not a good tenor to be found anywhere. The central banks I think at this point are as confused as is anyone else. I’m not sure anyone is going to look to central banks to be of great help right now.  (CNBC)

For one thing, sovereign wealth funds have no choice in selling off their US stocks because they are struggling to keep their own economies going — Japan, China and Saudi Arabia especially. Gartman said that the kinds of moves he’s seeing in Japan right now are something he hasn’t seen since the tsunami. Others agree that the central banks finally look confused and helpless:

Read the full article here: http://www.allselfsustained.com/hell-week-for-the-global-economy-gives-signs-of-things-to-come/