The Italian financial meltdown that we have been waiting for has finally arrived. For quite a long time I have been warning my readers to watch Italy, and now people are starting to understand why. Italian banking stocks continued their collapse for a fifth consecutive day on Wednesday, and nervous Italians are beginning to quietly pull large amounts of money out of the banks. In particular, Monte dei Paschi is a complete and utter basket case at this point. A staggering one-third of their loans are “non-performing”, and the stock price has fallen a staggering 57 percent since 2016 began. Monte dei Paschi is going to need a major bailout, and the same thing could be said about almost all of the largest Italian banks. But where is the money going to come from?

As rumors of trouble at Monte dei Paschi spread, Italians are getting money out of the bank while they still can. The following comes from the Daily Mail…

Some Monte dei Paschi customers have been pulling savings out of the Italian bank, its chief executive said on Wednesday, as it faces a crisis over a mountain of bad loans that has wiped nearly 60 percent off its market value this year.

CEO Fabrizio Viola did not say how much money savers had withdrawn, or when the outflow began, though he said the fall in deposits was “limited” and that the bank could cope with it as he sought to reassure customers and investors.

Italian bank shares have lost 24 percent since the beginning of 2016 as investors, already rattled about global economic growth, have sold out of a sector with low profitability and about 200 billion euros ($218 billion) of loans that are unlikely to be repaid.

And investors are pulling money out of Italian banking stocks at an alarming pace as well. According to the Telegraph, Unicredit is down 27 percent since the start of 2016 and Monte dei Paschi has plunged a total of 57 percent so far this month…

Italian banking stocks crashed again on Wednesday, continuing a month of poor performance and raising questions over the sustainability of the industry in its current structure – and even if it could end up in the same boat as Greece’s banking sector.

Long-suffering Monte dei Paschi’s stock dived another 18.5pc on the day, meaning the shares are down 57pc so far this month.

Even much more stable banks are witnessing a flight of investors – Unicredit’s shares are down 6pc on the day and 27pc since the start of the year.

Overall, the FTSE Italia All-Share Banks Index has plummeted 21 percent over the first three weeks of this year.

We normally only see numbers like this during a major financial crisis, and that is precisely what is happening.

Of course trouble has been building at Italian banks for a very long time. They have been exceedingly reckless, and almost all of them are absolutely saturated with bad loans at this point. Here is more from the Telegraph…

The analysts estimate the average Texas ratio – a measure of bad loans versus a bank’s capital buffers – of Italian banks stands at around 105pc, compared with just over 50pc in much of the eurozone.

A Bloomberg analysis puts Monte dei Paschi’s non-performing loans at almost one-third of its asset book, followed by Banca Carige at 27.4pc and Banco Popolare at 26.2pc, all cripplingly high levels.

And all of this comes in the context of a much broader European financial meltdown. The carnage that began at the turn of the year continued on Wednesday. Here are some of the specific numbers from Business Insider…

European markets dived into the red on Wednesday morning, and they didn’t come back out.

All major stock indexes on the continent had a pretty horrible day, with all but two, the DAX 30 in Germany, and the AEX in the Netherlands, falling more than 3%. The FTSE MIB in Italy, and the FTSE100 here in the UK are the biggest losers.

At the close Italy’s benchmark was down by 4.95% to 17,946 points, while the FTSE100 fell 3.39%, or 199 points.

At this point, almost all of the major European indexes have entered bear market territory.

Just check out how far stocks have fallen in some of the largest European nations since their 52-week peak…

United Kingdom: down 20 percent

Netherlands: down 22 percent

France: down 22 percent

Germany: down 24 percent

Turkey: down 24 percent

Italy: down 25 percent

Sweden: down 25 percent

Poland: down 26 percent

Portugal: down 28 percent

Spain: down 30 percent

Greece: down 44 percent

Overall, global stocks have now officially entered a bear market, and panic is spreading fast.

In the U.S., our markets are still in better shape than most of the rest of the world, so we don’t necessarily understand the severity of the situation quite yet. But let me assure you that what we are facing is incredibly serious. Even at the best of times, most of the major banks in Europe and Asia were on shaky ground, and all it was going to take was a major financial downturn for them to start toppling like dominoes.

Many people are now beginning to speculate that Italy may be the next Greece. Those that are saying this don’t truly grasp what is going on.

Greece is the 44th largest economy on the planet.

Italy is the 8th.

We have already seen how the rest of Europe really struggled to come up with a bailout for tiny Greece.

What in the world are they going to do when Italy goes down?

And of course Italy is not the only one that is going to need help. Financial meltdowns are now erupting all over the continent.

Those that believed that the European crisis was “finished” were sadly mistaken.

The European crisis is not over.

The truth is that the European crisis is just beginning.

Italy will probably be first, but economic and financial problems are going to spread like wildfire.

And by the time it is all said and done, European society is going to be fundamentally altered, trillions of euros will be lost, and the face of the continent will change.

(NaturalNews) A senior lawyer for the National Security Agency(NSA) recently admitted that his employer essentially gets help from some top media and technology companies to violate the Fourth Amendment protections of millions of Americans.

The lawyer, Rajesh De, who is the general counsel for the NSA, said recently that U.S. tech firms were completely aware of the agency's surveillance and widespread data collection, as reported by Britain's The Guardian newspaper.

Tech companies had full knowledge of NSA Internet data collection program

De said that all communications content and associated metadata scooped up by the agency under a 2008 law governing (and permitting) such surveillance took place with the full knowledge of the tech companies. He said that is true both for "Prism," an Internet-based data collection program, and the "upstream" collection of all communications moving online.

As The Guardian further reported:

Asked during a [recent] hearing of the U.S. government's institutional privacy watchdog if collection under the law, known as Section 702 or the FISA Amendments Act, occurred with the "full knowledge and assistance of any company from which information is obtained," De replied: "Yes."

The story regarding the Prism program was broken in June by The Guardian and The Washington Post, based on documents leaked to them by former NSA contractor Edward Snowden. At the time nearly all of the tech companies who were listed as taking part in the program - Yahoo, Google, Apple, Microsoft, Facebook and AOL - cried foul and claimed they had no knowledge about the NSA's massive surveillance or giving the agency access to customers' data. Indeed some of the companies, including Apple, claimed they had never even heard of the term Prism, The Guardian reported.

'Government is damaging our future'

But, as De explained, "Prism was an internal government term that as the result of leaks became the public term. Collection under this program was a compulsory legal process, that any recipient company would receive."

Following the hearing De said that Internet service providers are also aware of the surveillance and even receive legal directives regarding the spy agency's collection of communications data - not directly from the companies themselves but rather across the Internet, under the authority of Section 702 of the Act.

Following the initial disclosure in the press about the existence of Prism, there was an outcry in technology circles as companies launched in-depth public relations efforts aimed at calming their customers and reassure them of their privacy and data security. In addition, the companies were able to lobby the Obama administration successfully to give them more leeway in disclosing both the volume and type of data requests issued them by the federal government.

In recent days the founder of Facebook, Mark Zuckerberg, said he phoned Obama to voice his concerns about "the damage the government is creating for all our future." The Guardian reported that tech companies did not respond to De's revelations.

The paper further reported:

It is unclear what sort of legal process the government serves on a company to compel communications content and metadata access under Prism or through upstream collection. Documents leaked from Snowden indicate that the NSA possesses unmediated access to the company data.

Pyrrhic victory against the Obama regime

The ultrasecret FISA (Foreign Intelligence Surveillance Act) court ostensibly oversees spy agency and federal law enforcement agency surveillance requests, but critics of the process say the court is essentially a rubber stamp.

Still, under concessions won from the Obama administration, tech companies can now discloses the range of FISA-related court orders they receive, in bands of one thousand, and that would presumably include any court orders issued under the authority of Section 702.

"Passed in 2008, Section 702 retroactively gave cover of law to a post-9/11 effort permitting the NSA to collect phone, email, internet and other communications content when one party to the communication is reasonably believed to be a non-American outside the United States," The Guardian reported.

NSA reportedly stores all data received via Prism for five years and communications that are scooped directly from the Internet for two.

Sources:

http://www.theguardian.com

http://www.washingtonpost.com

http://www.dni.gov

Learn more: http://www.naturalnews.com/052707_big_brother_Internet_surveillance_NSA.html#ixzz3xzkL6TNz

We are about three weeks into 2016, and we are witnessing things that we have never seen before. There were two emergency market shutdowns in China within the first four trading days of this year, the Dow Jones Industrial Average has never lost this many points within the first three weeks, and just yesterday we learned that global stocks had officially entered bear market territory. Overall, more than 15 trillion dollars of global stock market wealth has been wiped out since last June. And of course the markets are simply playing catch up with global economic reality. The Baltic Dry Index just hit another new all-time record lowtoday, Wal-Mart has announced that they are shutting down 269 stores, and initial jobless claims in the U.S. just surged to their highest level in six months. So if things are this bad already, what will the rest of 2016 bring?

The Dow was up just a little bit on Thursday thankfully, but even with that gain we are still in unprecedented territory. According to CNBC, we have never seen a tougher start to the year for the Dow than we have in 2016…

The Dow Jones industrial average, which was created in 1896, has never begun a year with 12 worse trading days. Through Wednesday’s close, the Dow has fallen 9.5 percent. Even including the 1.3 percent gains as of noon Thursday, the Dow is still down nearly 8 percent in 2016.

But even with the carnage that we have seen so far, stocks are still wildly overpriced compared to historical averages. In order for stocks to no longer be in a “bubble”, they will still need to decline by about another one-third. The following comes from MarketWatch…

Data from the U.S. Federal Reserve, meanwhile, say U.S. nonfinancial corporate stocks are now valued at about 90% of the replacement cost of company assets, a metric known as “Tobin’s Q.” But the historic average, going back a century, is in the region of 60% of replacement costs. By this measure, stocks could fall by another third, taking the Dow all the way down toward 10,000. (On Wednesday it closed at 15,767.) Similar calculations could be reached by comparing share prices to average per-share earnings, a measure known as the cyclically adjusted price-to-earnings ratio, commonly known as CAPE, after Yale finance professor Robert Shiller, who made it famous.

Of course the mainstream media doesn’t seem to understand any of this. They seem to be under the impression that the bubble should have lasted forever, and this latest meltdown has taken them totally by surprise.

Ultimately, what is happening should not be a surprise to any of us. The financial markets always catch up with economic reality eventually, and right now evidence continues to mount that economic activity is significantly slowing down. Here is some analysis from Brandon Smith…

Trucking freight in the U.S. is in steep decline, with freight companies pointing to a “glut in inventories” and a fall in demand as the culprit.

Morgan Stanley’s freight transportation update indicates a collapse in freight demand worse than that seen during 2009.

The Baltic Dry Index, a measure of global freight rates and thus a measure of global demand for shipping of raw materials, has collapsed to even more dismal historic lows. Hucksters in the mainstream continue to push the lie that the fall in the BDI is due to an “overabundance of new ships.” However, the CEO of A.P. Moeller-Maersk, the world’s largest shipping line, put that nonsense to rest when he admitted in November that “global growth is slowing down” and “[t]rade is currently significantly weaker than it normally would be under the growth forecasts we see.”

In addition, another very troubling sign is the fact that initial jobless claims are starting to surge once again…

The number of Americans applying for unemployment benefits in mid-January reached seven-month highs, perhaps a sign that the rate of layoffs in the U.S. has risen slightly from record lows.

Initial jobless claims climbed a seasonally adjusted 10,000 to 293,000 in the seven days stretching from Jan. 10 to Jan 16, the government said Thursday. That’s the highest level since last July.

Since the last recession, the primary engine for the creation of good jobs in this country has been the energy industry.

Unfortunately, the “oil boomtowns” are now going bust, and workers are being laid off in droves. As I mentioned the other day, 42 North American oil companies have filed for bankruptcy and 130,000 good paying energy jobshave been lost in this country since the start of 2015. And as long as the price of oil stays in this neighborhood, the worse things are going to get.

A lot of people out there still seem to think that this is just going to be a temporary downturn. Many are convinced that we will just go through another tough recession and then we will come out okay on the other side. What they don’t realize is that a number of long-term trends are now reaching a crescendo.

For decades, we have been living wildly beyond our means. The federal government, state and local governments, corporations and consumers have all been going into debt far faster than our economy has been growing. Of course this was never going to be sustainable in the long run, but we had been doing it for so long that many of us had come to believe that our exceedingly reckless debt-fueled prosperity was somehow “normal”.

Unfortunately, the truth is that you can’t consume far more than you produce forever. Eventually reality catches up with you. This is a point that Simon Blackmade extremely well in one of his recent articles…

Economics isn’t complicated. The Universal Law of Prosperity is very simple: produce more than you consume.

Governments, corporations, and individuals all have to abide by it. Those who do will thrive. Those who don’t will fail, sooner or later.

When the entire financial system ignores this fundamental rule, it puts us all at risk.

And if you can understand that, you can take simple, sensible steps to prevent the consequences.

Sadly, the time for avoiding the consequences of our actions is now past.

We are now starting to pay the price for decades of incredibly bone-headed decisions, and anyone that is looking to Barack Obama, the Federal Reserve or anyone else in Washington D.C. to be our savior is going to be bitterly disappointed.

And as bad as things have been so far, just wait until you see what happens next.

2016 is the year when everything changes.

(The Economic Collapse)