Saudi Arabia is in deep financial trouble, and that spells financial trouble for the U.S. Let’s connect the dots. Shall we? The Senate just passed a bill that releases 28 secret pages from the 9/11 Report, and it also allows the families sue the Kingdom if it was involved in the attack. Saudi has threatened to dump U.S. assets if this becomes law. Some people say they would never do that because it would hurt them. I say, they may be forced to sell U.S. Treasuries and other assets because they need the money. This is against the backdrop of reports of Saudi Arabia paying workers and contractors with IOUs and mass layoffs in the Kingdom. No wonder why Moody’s just downgraded Saudi debt. This week, we also find out how much U.S. debt Saudi owns. It’s $117 billion. I would say this is on the top of the list to raise cash fast, and Saudi is not alone in the need for cash. This headline from CNN says it all: “U.S. Debt Dump Deepens in 2016.” China, Russia and Brazil are a few more of the many sellers of U.S. debt. How long can this go on for without something breaking? What if everybody holding U.S. debt sells? Not for some punishing reason but just because they need the cash.
The Fed is faking us all out again or are they? Fed Presidents Lacker and Dudley are pitching the possibility of a Fed rate hike–again. They are saying things such as “June is a live meeting.” I say no way they hike rates unless they want to intentionally crash the economy. Can’t see Fed Head Janet Yellen signing on to that less than 6 months before a Presidential election. This is much like the story of the little boy who cried wolf. The economy is terrible and no way is it getting better.
Is the global economy so bad that it is raising the specter of war? The U.S. just hit China with a more than 500% tariff on its steel exports. Of course, China is pissed, but it is flooding the world with cheap steel, and it is basically causing damage to its global competitors. Add that to the fact that thing are continuing to heat up in the South China Sea, and China continues to make military threats if the U.S. doesn’t back off. Meanwhile, in Europe, the Guardian UK is reporting “West and Russia on course for war, says ex-Nato deputy commander.” This war scenario is laid out in a new book by Former British General Alexander Richard Shirreff.
Hillary Clinton just cannot put away Bernie Sanders in the race for the Democratic nomination. Best she could do was a virtual tie in Kentucky and got whipped again in Oregon. Some of Bernie’s supporters call Hillary “Slillary.” It is amazing how weak the Clinton campaign looks, especially when you consider that Bernie is competing not only with Clinton but the entire DNC, which gives out super delegates to rig the system in Clinton’s favor. I think Sanders is going to win California, but that only adds to her problems. Remember, there is still that ongoing FBI criminal investigation on Clinton and her private unprotected server.
Join Greg Hunter as he looks at these stories and more in the Weekly News Wrap-Up.