Busted: Bankers and The Global Economy

November 7, 2008

Obama Promises Change: Fed Wants Control

conflict-of-power Obama FedWith 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

November 1, 2008

Economic Drain from IMF on Prime Economies

The International Monetary Fund has been bailing out emerging and secondary economies, putting prime economies like the U.S. and Britain in line to fork over more major funding. If you thought national deficits and crisis spending were enough, now prime economies have the IMF funding of lesser nations to consider. “Hundreds of millions of dollars” are needed now to support the sagging support structure of the IMF. This is relevant and an important dragging force on prime economies. If you live in the U.S. or Europe, that probably means you.

The cooling economic climate is resulting in economies across the globe taking evasive action to the degree possible, usually using the same methods employed in the United States like lowering central bank interest rates in order to sustain their banks and encourage lending. The IMF is acting as an insurance policy to shore up foundering economies. Prime Minister Gordon Brown is recommending a better insurance system to assist distressed nations, a topic that will doubtless be near the top of the Global Financial Summit in New York City this month. Financial security is now a global watch word.

Banks globally have been racing to bolster their balance sheets after a bevy of collapses and hastily arranged mergers were prompted by heavy losses from bad mortgage and financial derivatives. In the meantime, surface signs indicate a slight lessening in the immediate stability crisis as far as the current market is concerned. The U.S. government is tiptoeing quietly as the presidential election is only days away. More bad news will likely affect the election and most possibly the results. Until then, the U.S. will try to enforce an all quiet on the economic front. Will the stock markets cooperate after a banner week? Ah, there’s the rub. ~ E. Manning

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