18 Signs That Global Financial Markets Smell Blood In The Water

The Economic Collapse
July 19, 2011

Can you smell it?  There is blood in the water.  Global financial markets are in turmoil.  Banking stocks are getting slaughtered right now.  European bond yields are absolutely soaring.  Major corporations are announcing huge layoffs.  The entire global financial system appears to be racing toward another major crisis.  So could we potentially see a repeat of 2008?  Sadly, when the next big financial crisis happens it might be worse than 2008.  Back in the middle of 2008, the U.S. national debt was less than 10 trillion dollars.  Today it is over 14 trillion dollars. Back in 2008, none of the countries in the EU were on the verge of financial collapse.  Today, several of them are.  This time if the global financial system starts falling apart the big governments around the world are not going to be able to do nearly as much to support it.  That is why what is happening right now is so alarming.  As signs of weakness spread, the short sellers and the speculators are starting to circle.  They can smell the money.
Back in 2008, bank stocks led the decline.  Today, that appears to be happening again.  The "too big to fail" banks are getting absolutely pummeled right now.  Most people don't have much sympathy for the banksters, but if we do see a repeat of 2008 they are going to be cutting off credit and begging for massive bailouts once again, and that would not be good news for the economy.
In Europe, the EU sovereign debt crisis just seems to get worse by the day.  Bond yields for the PIIGS are going haywire.  The higher the yields go, the worse the crisis is going to get.
Meanwhile, as I have written about previously, a bad mood has descended on world financial markets. Pessimism is everywhere and fear is spreading.  The short sellers and the speculators are eager to jump on any sign of weakness.  Investors all over the globe are extremely nervous right now.
So what happens next?
Well, nobody knows for sure.
But things certainly do not look good.
The following are 18 signs that global financial markets smell blood in the water....
#1 Banks stocks are absolutely getting hammered right now.  Bank of America hit a 52 week low on Monday.  Bank of America shares declined 4 percent to $9.61.
#2 So far this year, Bank of America stock is down about 27 percent.
#3 Bloomberg is reporting that Bank of America may be forced to increase its capital cushion by 50 billion dollars.
#4 Shares of Goldman Sachs and Morgan Stanley are near two year lows.
#5 Shares in Citigroup fell 2.5 percent on Monday.
#6 Moody's recently warned that it may be forced to downgrade the debt ratings of Bank of America, Citigroup and Wells Fargo.
#7 Barclays Capital, Goldman Sachs, Bank of America, JPMorgan Chase and Morgan Stanley are all either considering staff cuts or are already laying workers off.
#8 The deputy European director of the International Monetary Fund says that the Greek debt crisis is "on a knife's edge".
#9 Moody's has slashed Ireland's bond rating all the way to junk status.
#10 The yield on 2 year Portuguese bonds is now over 20 percent, the yield on 2 year Irish bonds is now over 23 percent and the yield on 2 year Greek bonds is now over 35 percent.
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