Why did the global stock market crash and who is to blame?
"Political mismanagement of debt, politicized fact-spinning, and resulting inflation" led to serious market volatility, as the recent global market plummet has shown, Paul Goncharoff, a veteran financial analyst, told Sputnik.
1. Decline of G7 economies
Japan’s benchmark Nikkei 225 stock index plunged 12.4%, prompting a chain of share dumps as investors fretted over the state of the US economy and fears of a recession. The knee-jerk global market response is triggered by the grim report showing that US unemployment had surged to reach 4.3%.
2. US debt-morphed economy
Goncharoff said that “the world's financial flows are based on debt,” and the US economy has long “morphed” into a debt economy. “How do you attract new buyers of US debt? By increasing yields earned, which leads to all the problems.”
Though government bonds are assumed to be safe, if their value experiences volatility “because of politicized fiscal policy or extreme geopolitical positions,” then those who borrowed against them may be forced to sell, starting off a chain reaction, he noted.
3. Inflation
Inflation can prompt holders of government bonds to request a yield to compensate for the fact that when the bond is finally paid back, the money will not be worth what it was originally, Goncharoff explained.
4. Middle Eastern “geopolitical cauldron”
Developments in the Middle East could further feed into the “crowded geoeconomic and geopolitical cauldron,” stressed the pundit, forcing it to “boil over.”
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"Political mismanagement of debt, politicized fact-spinning, and resulting inflation" led to serious market volatility, as the recent global market plummet has shown, Paul Goncharoff, a veteran financial analyst, told Sputnik.
1. Decline of G7 economies
“Neither the US, EU or Japanese economies are doing well. The US manufacturing sector contracted for the 4th consecutive month in July, with the Manufacturing PMI registering 46.8%, signaling a technical recession,” he said.
Japan’s benchmark Nikkei 225 stock index plunged 12.4%, prompting a chain of share dumps as investors fretted over the state of the US economy and fears of a recession. The knee-jerk global market response is triggered by the grim report showing that US unemployment had surged to reach 4.3%.
2. US debt-morphed economy
Goncharoff said that “the world's financial flows are based on debt,” and the US economy has long “morphed” into a debt economy. “How do you attract new buyers of US debt? By increasing yields earned, which leads to all the problems.”
Though government bonds are assumed to be safe, if their value experiences volatility “because of politicized fiscal policy or extreme geopolitical positions,” then those who borrowed against them may be forced to sell, starting off a chain reaction, he noted.
3. Inflation
Inflation can prompt holders of government bonds to request a yield to compensate for the fact that when the bond is finally paid back, the money will not be worth what it was originally, Goncharoff explained.
4. Middle Eastern “geopolitical cauldron”
Developments in the Middle East could further feed into the “crowded geoeconomic and geopolitical cauldron,” stressed the pundit, forcing it to “boil over.”
“We are witnessing a massive loss of trust among the international community as to the true intentions and goals of the US government, which just increases volatility and uncertainty,” he concluded.
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Sputnik International
Bangladesh PM resigns after weeks of violent protests: what you need to know ◾️ Bangladeshi Prime Minister Sheikh Hasina has resigned and left Dhaka, the capital, after nearly two months of violent unrest. At least 93 people were killed in the violence,…
Change of political power in Bangladesh is an internal matter of the country – Russian Foreign Ministry
According to the Russian embassy in Bangladeshi capital Dhaka, no Russian citizens were injured during the recent riots that led to the overthrow of prime minister Sheikh Hasina, the Russian Foreign Ministry's website reported.
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"Russia proceeds from the fact that the change of political forces in power in Bangladesh is an internal matter of this country, at the same time counting on the speedy return of internal political processes in our friendly state in the constitutional direction," the ministry stated.
According to the Russian embassy in Bangladeshi capital Dhaka, no Russian citizens were injured during the recent riots that led to the overthrow of prime minister Sheikh Hasina, the Russian Foreign Ministry's website reported.
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Lockheed Martin shares reach all-time high amid geopolitical turmoil
US defense corporation Lockheed Martin experienced a dramatic surge in its market cap during Friday trading with its stock price climbing at $560 before retreating to $548.
Earlier market observers agreed that Lockheed shares are rallying, having taken off on 22 July and soared from $474 to all-time high prices over $548 on August 01-02.
In the end of July, Lockheed Martin posted second-quarter financial results with net sales of $18.1 billion – a 9% annual increase.
Bigger Picture
However, Lockheed Martin stock has been rising for almost 10 months now since Hamas launched its surprise attack on Israel on October 7 2023. Having closed at $395 on October 6, company shares jumped to $430 on October 9 – the first trading day after the onset of the crisis. From that moment on, Lockheed Martin shares increased in value.
Commenting on Lockheed Martin’s stock performance amid Middle East tensions, JP Morgan analyst Seth Seifman admitted to CNBS in April that the perils of a “dangerous world” may be “a potential source of support” for defense company’s shares.
What’s your take on Lockheed Martin shares performance?
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US defense corporation Lockheed Martin experienced a dramatic surge in its market cap during Friday trading with its stock price climbing at $560 before retreating to $548.
Earlier market observers agreed that Lockheed shares are rallying, having taken off on 22 July and soared from $474 to all-time high prices over $548 on August 01-02.
In the end of July, Lockheed Martin posted second-quarter financial results with net sales of $18.1 billion – a 9% annual increase.
Bigger Picture
However, Lockheed Martin stock has been rising for almost 10 months now since Hamas launched its surprise attack on Israel on October 7 2023. Having closed at $395 on October 6, company shares jumped to $430 on October 9 – the first trading day after the onset of the crisis. From that moment on, Lockheed Martin shares increased in value.
Commenting on Lockheed Martin’s stock performance amid Middle East tensions, JP Morgan analyst Seth Seifman admitted to CNBS in April that the perils of a “dangerous world” may be “a potential source of support” for defense company’s shares.
What’s your take on Lockheed Martin shares performance?
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❗️Iran resolved to launch an attack on Israel – Israeli FM
The warning from Iran was conveyed to Israel by Hungarian Foreign Minister Péter Szijjártó, who contacted Israeli Foreign Minister Israel Katz directly after receiving the information from acting Iranian Foreign Minister Ali Bagheri.
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The warning from Iran was conveyed to Israel by Hungarian Foreign Minister Péter Szijjártó, who contacted Israeli Foreign Minister Israel Katz directly after receiving the information from acting Iranian Foreign Minister Ali Bagheri.
"Iran has informed us that it intends to attack Israel,” Katz stated.
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📹 Russian Secretary of the Security Council Sergei Shoigu held a meeting with Iran's President Masoud Pezeshkian, Tasnim News Agency reports
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Bangladeshi president will dissolve parliament for the sake of forming an interim government – report
The armed forces will ensure security and the return of order from anarchy during the formation of the interim government, news site Prothomalo reported.
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The armed forces will ensure security and the return of order from anarchy during the formation of the interim government, news site Prothomalo reported.
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Sputnik International
❗️Iran resolved to launch an attack on Israel – Israeli FM The warning from Iran was conveyed to Israel by Hungarian Foreign Minister Péter Szijjártó, who contacted Israeli Foreign Minister Israel Katz directly after receiving the information from acting…
How Israel-Iran escalation may break the back of global economy
US Secretary of State Antony Blinken told Washington's G7 allies on Sunday that Iran and Hezbollah could attack Israel in the next 24 hours to avenge the deaths of Hamas politburo chief Dr Ismail Haniyeh in Tehran and senior Hezbollah commander Fuad Shukr, Axios reported.
Growing concerns over Iran's potential attack have added to fears of a US recession in the aftermath of a weaker than expected jobs report which affected global markets on Monday with stocks plummeting in Asia and Europe.
Under those circumstances, an escalation of the Iran-Israel stand-off could be the proverbial straw which would break the global markets' back, according to Goncharoff.
⚡️ The Middle East region would essentially be a no-go zone, forcing up already high freight rates;
⚡️ Oil prices would probably rise. Coupled with anti-Russia energy sanctions, a conflict with Iran could affect G7 manufacturing potential;
⚡️ The dollar may see a brief stabilization in response;
⚡️ The value of key cryptocurrencies, as well as gold and silver will "lead the way towards safe haven stability;"
⚡️ An escalated conflict would affect supplies of food, especially in the Middle East and North Africa region.
The world is moving into uncharted, dangerous territory largely created by Washington's irresponsible policies and dysfunctional democratic processes, the pundit concluded.
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"Like the story of the straw that broke the camel's back, within this very crowded geo-economic and geopolitical cauldron, any additional ingredient to this witches brew could force it to boil over," Paul Goncharoff, veteran financial analyst and co-owner of the Russia's Pivot to Asia project, told Sputnik.
US Secretary of State Antony Blinken told Washington's G7 allies on Sunday that Iran and Hezbollah could attack Israel in the next 24 hours to avenge the deaths of Hamas politburo chief Dr Ismail Haniyeh in Tehran and senior Hezbollah commander Fuad Shukr, Axios reported.
Growing concerns over Iran's potential attack have added to fears of a US recession in the aftermath of a weaker than expected jobs report which affected global markets on Monday with stocks plummeting in Asia and Europe.
Under those circumstances, an escalation of the Iran-Israel stand-off could be the proverbial straw which would break the global markets' back, according to Goncharoff.
The world is moving into uncharted, dangerous territory largely created by Washington's irresponsible policies and dysfunctional democratic processes, the pundit concluded.
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Sputnik International
📹 Russian Secretary of the Security Council Sergei Shoigu held a meeting with Iran's President Masoud Pezeshkian, Tasnim News Agency reports 📌 Subscribe to @SputnikInt
Russia-Iran regional cooperation is crucial – Iranian president
The era of US leadership has passed and cooperation between Russia and Iran in the development of a multipolar world will contribute to improving global security, Iranian President Masoud Pezeshkian stated at a meeting with Secretary of the Russian Security Council Sergei Shoigu in Tehran, Iran.
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The era of US leadership has passed and cooperation between Russia and Iran in the development of a multipolar world will contribute to improving global security, Iranian President Masoud Pezeshkian stated at a meeting with Secretary of the Russian Security Council Sergei Shoigu in Tehran, Iran.
"Russia is among the countries that support the Iranian nation in difficult times,” Pezeshkian said. “The development of relations with this strategic partner is one of the priorities of the foreign policy of the Islamic Republic of Iran,” he added. “It is necessary to accelerate the implementation of the agreements concluded between the two countries."
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Just in time to repulse aggression: Meet Iran’s brand new air and missile defense systems
Iran has developed an array of sophisticated homegrown air defense systems and radars over the years, including several unveiled in 2024. Here’s what we know about them:
9-Dey
🔸 This new short-range air defense system was successfully tested during IRGC Aerospace Force drills in January. Designed to engage low-altitude threats, the 9-Dey missiles’ launcher is mounted aboard a modified Sevom Khordad road-mobile medium-range air defense missile system.
🔸 Making use of the Sevom Khordad’s launch vehicle and radar, the 9-Dey comes with eight 200 kg ready-to-fire missiles with a range of up to 30 km.
Arman
🔸 Unveiled in February, this air defense and anti-ballistic missile system features a sophisticated radar (active or passive, depending on variant) with a 360-degree field of view and the ability to identify and track up to 24 targets at ranges up to 200 km.
🔸 The systems’ road-mobile launchers can be fitted to carry between one and three heavy 1,000 kg Sayyad-2 and Sayyad-3 series interceptors.
Azarakhsh
🔸 Also unveiled in February, this modular short-range, low-altitude air defense system is designed to be light enough to be carried by small trucks, and has 70 kg missiles with a 4.5 kg HE-Frag warhead and a range of up to 10 km.
🔸 The system has four ready-to-launch missiles. Because the platform is modular, in addition to trucks, it can, in theory, also be attached to other vehicles, warships, or stationary sites.
Upgraded Bavar-373
🔸 In April, Iran showed off a new version of the Bavar-373 - the road-mobile long-range surface-to-air and anti-ballistic missile system unveiled in 2019 and touted as the Iranian analogue to Russia’s S-300.
🔸 The upgraded system is said to feature modified Sayyad-4B two-stage solid-fueled interceptor missiles, and to boast the ability to intercept and engage aerial targets at ranges between 300-400 km at altitudes up to 120 km.
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Iran has developed an array of sophisticated homegrown air defense systems and radars over the years, including several unveiled in 2024. Here’s what we know about them:
9-Dey
Arman
Azarakhsh
Upgraded Bavar-373
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Who profits from Venezuela’s energy riches as Maduro mulls expanding BRICS’ share?
President Maduro has revealed that Venezuela’s biggest energy investments are coming from BRICS countries, and warned that if the US and its allies “make the mistake of their lives” by continuing their attempts to destabilize Venezuela, their oil and gas contracts could go to Caracas’s allies.
🔹 Possessing 300 bln barrels of oil and 195 trln cubic feet of natural gas, Venezuela accounts for a whopping 17% of global crude reserves, and about 3% of gas reserves.
🔹 State-owned oil giant Petroleos de Venezuela (PDVSA) is Venezuela’s largest energy producer, with total national output by PDVSA and foreign partners reaching 993,000 barrels per day (bpd) in July, and shipped to Asia, the US, Europe and Cuba.
What contracts does West stand to lose?
🔹 US and European energy giants were largely frozen out of operations in Venezuela in 2019 by US sanctions threats. A 2022 deal enabled their return in an oil-for-debt arrangement designed to minimize cash flowing into PDVSA’s coffers. US oil giant Chevron now pumps up to 200,000 bpd of Venezuelan crude from four joint venture sites, and plans to increase output by another 65,000 bpd by year’s end.
🔹 Spanish oil major Repsol extracts some 20,000 bpd of oil and 40 mln cubic feet of gas daily, and is looking to expand its stake in undeveloped oil fields with a production potential of over 300,000 bpd. Repsol’s output is concentrated at four main sites, including the offshore Perla Field off Venezuela’s northwest coast.
🔹 Italian energy company Eni has also been authorized to resume pumping oil in Venezuela, with a joint venture with PDVSA in the Petrosucre field producing about 2,200 bpd (but able to produce 24,000 bpd or more historically). Eni is also in talks with PDVSA about unfreezing the shallow-water Corocoro crude project, and joining the Perla gas project.
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President Maduro has revealed that Venezuela’s biggest energy investments are coming from BRICS countries, and warned that if the US and its allies “make the mistake of their lives” by continuing their attempts to destabilize Venezuela, their oil and gas contracts could go to Caracas’s allies.
What contracts does West stand to lose?
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Argentina to send gold abroad while others repatriate it
The West’s freezing of nearly the half of Russia’s $640 billion gold and foreign assets prompted many countries to repatriate their bullion from foreign banks abroad. But in June Argentina did the opposite and sent $450 million-worth of gold abroad.
According to the Invesco’s survey in 2023, 68% of national banks maintain part of their gold reserves in their own country, compared to 50% in 2020. For 2027, this number is expected to rise to 74%.
What Countries have successfully repatriated their gold?
⚡️ Venezuela’s BCV: 160 tons from US and Europe in 2011-2012
⚡️ Germany’s Bundesbank: 674 tons from New York and Paris in 2013-2017
⚡️ The Netherlands’ DNB: 122.5 tons from New York in 2014
⚡️ Hungary’s MNB: 28.4 tons from the UK in 2018
⚡️ Romania’s BNR: 18 tons from London in 2019
⚡️ Poland’s NBP: 100 tons from London in 2019
⚡️ Turkiye’s CBRT: 220 tons from US and UK in 2019
⚡️ India’ RBI: 100 tons from London in 2023
Countries that hold the majority of gold reserves of foreign countries:
⚡️ USA, United Kingdom, Switzerland, France and Canada.
Countries with gold frozen abroad
⚡️ Russia: in 2022 US, EU, UK, and other Western nations froze an estimated $300 billion worth of Russia's gold and foreign exchange
⚡️ Zimbabwe: the US imposed sanctions, including an embargo of the country’s gold exports, in 2003
⚡️ Libya: the UN Security Council imposed sanctions freezing assets and gold reserves in 2011
⚡️ Iran: the US froze $100 billion in gold in 2018
⚡️ Afghanistan: 2021, the US froze $7 billion in assets and a portion of gold reserves in 2021
⚡️ Venezuela: The Bank of England has refused to return $1.95 billion in gold since 2020
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The West’s freezing of nearly the half of Russia’s $640 billion gold and foreign assets prompted many countries to repatriate their bullion from foreign banks abroad. But in June Argentina did the opposite and sent $450 million-worth of gold abroad.
According to the Invesco’s survey in 2023, 68% of national banks maintain part of their gold reserves in their own country, compared to 50% in 2020. For 2027, this number is expected to rise to 74%.
"We did have it held in London,” said one central bank, quoted anonymously. “But now we've transferred it back to own country to hold as a safe haven asset and to keep it safe."
What Countries have successfully repatriated their gold?
“The repatriation of our gold was an act of financial prudence and sovereignty,” said former president of the central bank of Venezuela Nelson Merentes in 2012.
Countries that hold the majority of gold reserves of foreign countries:
Countries with gold frozen abroad
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