A “perfect storm” of fiscal woes in the United States, a slowdown in China, the debt crisis in Europe and stagnation in Japan has a decent chance of damaging the global economy by 2013, Roubini told reporters late last week. Even so, he is being quite conservative about it. A 33% chance doesn’t seem like news to me. All this by New York University professor Nouriel Roubini, who correctly predicted the global economic crisis in 2008.
According to Mr. Roubini, the world economy expansion may slow in the second half of this year as “the deleveraging process continues, fiscal stimulus is withdrawn and confidence ebbs.” To me, this seems obvious. This process is really part of what is already happening. It’s not news. The job market stinks in the U.S. and other modern nations. Money isn’t being made abundantly in the real economy. It’s all on Wall Street and in the investment world, based on heavy borrowing and debt restructuring of nations based on fiat money. Washington has been unwilling to deal with a one-trillion-plus budget deficit and a distinct bond market revolt is in the wings. Investors are waking up to the danger to their investment as US bonds are in danger of becoming junk. This will create higher interest rates and possible hyperinflation, which will remove any possibility of a recovery, even resulting the destruction of the dollar for an international medium of exchange. The bankers aren’t truly bothered by this. Based on inside information, the bankers already have a plan in the wings that I have touched on previously. It’s all about marketing, presentation to them.
Already, we have riots in Greece, as they face the music regarding the bad debt that the nation and bankers have created. They claim that officials need to restructure the debt of Greece, Ireland and Portugal. Waiting too long will ultimately result in the disintegration of the euro zone stability, experts say. Roubini agrees. The ridiculous aspect to the entire scenario is that all banking debt in the current system that is created will never be paid back. Further, much of this debt has been cleverly folded into Wall Street investments with the idea of making money, either through long or short selling. But this does not solve the problem of any debt unless the nations involved have the ability to make money by having control. They don’t. Only the bankers make money on any debt. In the meantime, these nations are paying on interest, not on principal. It’s stupid. The spiral never ends. Roubini and most economists remain silent on this aspect of the system.
Many other analysts, like myself, have repeatedly warned of a “possible” repeat of the 2008 global economic meltdown in the immediate future. Others, like Moscow financial expert Alexander Osin expresses hope that the international community will be able to find the way out. Russian economist Konstantin Sonin warns against overdramatizing the situation since people like Roubini are full of it, false prophets, in essence. The solution?
“The world economy faced such a problem in the 1930s,” Osin says, adding that Adolf Hitler’s ascent to power and the beginning of World War Two helped to resolve the problem. “At present, it should be solved by peaceful means, which the global community is almost certain to find.” Certainly, the Russians and Arabs are doing quite well since they are sitting on oil profits. That will only last as long as the current monetary gaming system does. That is the problem behind the whole matter. An eternal debt-based banking system destroys the nations that depend on it unless they are sitting on huge cash cow. Rest assured, that is temporary. If they are doing business with the bankers, the banking system will drain that wealth too. That is the nature of the system in place, as well as the nature of the future system.
So, to solve the problem we need a global war and preferably another Hitler. In the meantime, resolving the monetary system crisis is all about “hope,” and now we are listening to Russians for economic advice. The global economy really is in trouble. There won’t be any gain without plenty of pain. Never mind the pain that so many are in now.
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With the election of the new 44th U.S. President of the United States, the mandate of U.S. politics has been clarified. The hope of much of the American populace has been ignited. The Federal Reserve and the global consortium of central bankers aren’t nearly so excited, showing a typical understated and conservative resistance to change that doesn’t put them in the driver’s seat.
Apparently Kevin Warsh, Governor of the Federal Reserve believes that the world should look upon the financial hell of the last year with a hint of reminisce. “This challenge of creating a new financial architecture is hardly unique to the United States. The difficult choices made by policymakers and market participants around the globe will have real implications for future growth prospects.” That is in fact what many world leaders are intently interested in at the projected global financial summit that is planned at U.N. headquarters in New York City. The wild promotion of the financial summit is driven by the desire to change the current financial architecture.
Warsh spews plenty of bankerspeak which essentially boils down to this summary: the new financial architecture must be properly understood, in full recognition of current business relationships and restrained accordingly. Not so coincidentally, this recommendation would keep the control firmly among the International Society of Bankers, the loosely amalgamated brotherhood of central bankers headquartered in Switzerland and Rome.
Warsh correctly blames the current financial crisis on inadequate market discipline, excessive reliance on credit ratings coupled with poor credit and liquidity risk-management practices by many financial firms. However, until recently, the Federal Reserve has been unwilling to promote any changes, instead promoting the vaguely governmental mantra of financial literacy.
Warsh recognizes the global economic challenge, but does not admire the “implementation of well-intended housing policies.” Instead, the central banking consortium clearly sees the new financial architecture solely in business terms that will fuel economic growth, a clear promotion of continued Republican financial policy that has been gradually adopted over the last several decades. In essense, the advance of Republican power, policies and laissez-faire trickle-down economics has bolstered the role of not only the Federal Reserve, but the global power of central bankers through the power and prestige of the dollar, now firmly under their control.
The new Obama administration has more to fight than mere Republican policies. They must come squarely to terms with global bankers that currently hold the keys to their financial success. With the current fiscal situation of this nation regarding the fiat money of the dollar, the bankers have politicians largely where they want them. Arguably, John F. Kennedy lost his life as a result of opposing the global central banking community. They still hold the same power of life and death in the world today, only more so. ~ E. Manning
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Market Note: Here is the real news today.
Central bankers are pumping billions of dollars in American greenbacks into monetary systems to “sustain the market.” Who asked the blighters? What central bankers are doing is fueling the fires of inflation which makes the repercussions of bailout fever more difficult. Yet, nobody asks the question why. Central bankers, under the pretense of helping the market are profiteering and “making themselves useful.” The reality is that they are stoking the fire of U.S. inflation and inflation globally, while taking gold in exchange into their larder to count among themselves as they gloat. The winner of this “market sustenance” is the central banker or the body of International Bankers. Curiously, this is not fostered by the Federal Reserve system directly. However, the central bankers are all in on the same scheme: corporate profits. They do this by bleeding the system and holding the gold while creating more fiat money to lower the value of currency, in this case the staple of the global economy, the dollar which is managed by the Federal Reserve. The end result will be higher prices, devalued currency and more finanical pressure, not less. Don’t be fooled. Markets and panic will heat up whether they do so today or tomorrow. What does this mean for the United States? STAGFLATION. Central bankers are sacrificing the U.S. economy. 5AM CST ~ E. Manning
Read this post penned earlier this morning. Global Economic 911 in Progress
In the last few months, Busted Bankers has discussed the distinct and strongly lingering likelihood of a larger global downturn or collapse in global financial markets. In the past, you didn’t hear any of that in the States except among a smallist number of bloggers and from a few Scot and British financial specialists. These bankers approximately timed and named the general events that would transpire. Those general events have come home.
In the United States, we are chiefly concerned with covering up and dealing with public embarassment on virtually all levels. The inability to admit weakness is a larger flaw than the weakness itself. The confidence crisis here is based in that embarassment along with the truth that investors are spinning in circles looking for a “safe place” to shelter their money. Investors and consumers alike are discovering that there is little safety: that all the gains that have been made over the last decade or more could easily be swallowed whole.
Politician John McCain heralded the idea that “economic fundamentals” are strong. Unfortunately for politicians that long for a rosy picture, the global financial crisis was not created by healthy economic fundamentals, but through misappropriation, greed and fraud in the mortgage and finance industry as well as through creative banking instruments. That cold reality is beyond the realm of economic fundamentals, although even the Federal Reserve system in the U.S. wants to make these corrupted banking standards part of economic fundamentals. This global crisis may make that desire and tendency unpopular, if not impossible. (more…)
The addiction to fiat money is huge. The value of this wealth on paper that circles the globe is difficult to estimate. The Bank for International Settlements guesses at $600 trillion dollars deduced by wading through tomes of data. Global gross national product is estimated at $50 trillion dollars yearly. If that figure is correct, the world is overextended by about 12 years of global production. All the credit and faith in government cannot pay for the debt that the International Society of Bankers has managed to create in the form of fiat money. The people of the world cannot pay the debt that has been created nor can the bankers except by printing more paper. How much of the debt is secured by real assets is impossible to say although a guess could be made based on the fractional reserve. Commercial banking has become addicted to creative banking procedures in an effort to create larger profits. Unfortunately, because of the complexity of a dozen creative banking instruments like SIVs and CDOs, even the best guess of the amount of real debt is probably impossible to calculate. The global banking economy is in an intimidating and complex situation.
The unease in banking and finance about subprime mortgages gives the world a tiny snapshot of what is ahead based on the current system in place. Other banking “derivatives” within the industry include private-equity, mutual funds, pension funds and hedge funds. This debt is a major issue since every piece represents a debt that must be repaid. When a creditor expects money, the demand must be met by the debtor. If enough default exists within the global banking economy or a smaller banking community, a house of cards scenario will ensue. The pursuit of the fractional reserve virtually guarantees that the global addiction to fiat money will backfire as bank write-offs for bad debt are posted.
Someone will bear the loss first. A banking conglomerate can bear catastrophic losses based on worthless credit that has been extended as debt. The infection can quickly become epidemic, much as the subprime mortgage problem spread to the entire mortgage industry and continues to proliferate in the global banking system. A collapse of the housing market along with a collapse of other asset markets is virtually inevitable based on the current global debt structure. The addiction to the illusion of money can create a global catastrophe as the International Society of Bankers actually possesses most of the gold and worthwhile assets as security including the people of the nations in debt. The slavery to this “New World Order of Banking” will become apparent to all involved. The reality is that this scenario is effectively in place. It just has not been noticed by most people yet. The reality of world addiction has not set in.
In the meantime, central banks or Federal Reserve bankers see the danger in the regional global markets and are ready to stand by with more fiat money to bolster liquidity where it is needed. Bankers require security and more often that security is becoming more speculative in nature. The International Society of Bankers has no intention of absorbing junk security. They clearly specify that they are not in the position to bail out mismanagement and malfeasance of the commercial banking and finance industry. Hyperinflation/devaluation caused by printing of more currency threatens to make some major currencies worthless. In order to overcome this plague, a redesign of the global banking and financial system seems in the immediate future. Quiet rumblings persist even now. This rumbling makes sense since national economies or even the global economy could be effectively shut down while the redesign and its negotiation are in the works. This would not only be counterproductive, but bite into further profits that the International Society of Bankers can make. In the meantime, commercial bankers are oblivious as they seek to pursue their regular course of business and profits in the hope that new global change will pass them by. ~ E.M.