Busted: Bankers and The Global Economy

June 15, 2011

US economist predicts economic storm in 2013

devalued dollarA “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economy expansion may slow in the second half of this year as “the deleveraging process continues, fiscal stimulus is withdrawn and confidence ebbs.”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.

E. Manning

Advertisements

July 19, 2009

Economic Depression: American Resentment Flickers Against Corporate Wealth

money green with envyThe recession and the rising gulf between the haves and have nots; investment bankers versus newly impoverished and unemployed Americans is changing viewpoints. At one time, any company reporting record profits was certain to earn applause for this was seen as the American way. Americans were firmly invested in what they believed was the trickle-down theory of economics. The scam that investment bankers have pulled on the world with their highly staked leveraging games has changed much of this sentiment. Now that institutions that formerly made up the investment banking capital of the world are recovering with the intent of paying back taxpayer-backed Federal Reserve bailout money, Americans are leering at the possibilities that nothing has been learned from the crisis of financial literacy that prevails itself upon the world.

Writer David Segal has introduced the idea that class resentment is to blame as investment bankers continue to rake in the speculation-based financial dough based on the same numbers games that brought the nation to the edge of financial oblivion. The reality runs much deeper. In the eyes of Americans, the reality isn’t about making money, but how money is earned. Americans feel that they are being scammed because the nation operates by multiple sets of rules depending on how much money and influence you can peddle. Even members of Congress like Charles Schumer have demonstrated that they believe Americans are simply brutes to be used by the system to bolster corporate along with government wealth and influence.

Now that the likes JP Morgan Chase and Goldman Sachs are reporting fantastic encouraging numbers after having enjoyed bailout at the expense of Americans and the system at large, Americans see that the victory is very hollow. Recent financial victories in American are without benefit to anyone that doesn’t directly play the insider financial games on Wall Street. Multinational corporations continue to rule the roost behind the scenes, taking more out of America than they put in. Profit without personal responsibility is king. Most of America continues to be in great pain and America already knows that recent financial victory on Wall Street is a result of the same deluded thinking and policy that still threatens to destroy the financial system. It is not a system based on honesty and real numbers, but simply a gambling game of manipulation and opportunity.

The fact is that the Federal Government likes the control and authority that it wields in the banking community as a result of the bailout. The same can be said for the money that government has invested in the corporate structure. Uncle Sam holds the cards as the government maintains a front row seat at AIG. This is the only means that government now has to rein in the continued greed and avarice of Wall Street and corporate investors. The system hasn’t been reinvented as promised nor have sufficient reforms taken place to insure the safety of financial system on any level. We are still living in the last century. Nothing has changed. That is why government is so quiet about what is a hollow victory on Wall Street. ~ E. Manning

May 28, 2009

Investors Afraid of Bailout Involvement

Filed under: banking, economy, government, money — Tags: , , , , , , , , , , , , , — digitaleconomy @ 10:41 am

toxic debtTo cleanse bank balance sheets of distressed loans, other unwanted assets and “reduce the associated market overhang”, the FDIC and Treasury launched the Legacy Loans Program. Now the plan has stalled and is likely to put be on hold, terminated or modified again as stifled feds puzzle over their dilemma.

The Legacy Loans Program as crafted by the Federal Deposit Insurance Corp is part of a $1 trillion Public Private Investment Program announced back in March. This program was theoretically designed to encourage banks to sell securities and loans weighing down balance sheets to willing investors. Many banks, flush with bailout cash, have gained a feeling of stability with previous government bailout and have become less eager to be involved in the Legacy program.

Prospective buyers and sellers are reluctant to be involved in such an endeavor and have voiced their concerns to the FDIC about participating. The majority are fearful that the federal government will change program rules in the ‘middle of the game’. Investors are also fearful of financial backlash from an overall hostile attitude against Wall Street.

Bailout ideas simply don’t seem to be working in the realm of public opinion and scrutiny. Even investors don’t want to be attached to the crooked banking mess that the bankers have created. ~ E. Manning

legacy-loans

April 16, 2009

Economic Lies that the System Promotes

snake-oilYeah. Yeah. You’ve heard it all and everybody is trying to sell you something. The snake oil salesmen are all around. Washington is no different. The lie continues to spread that investing your money in banks or the latest government bonds are safe and sound investing. Think again.

The problem is that we have a ‘dumbing down’ of the American economic system as foreign investors pile on to invest their otherwise worthless American greenbacks and you are the one that will suffer through devaluation and hyperinflation because you base your life on money and monetary acquisition that central bankers run. Your economic livelihood and future is at stake if you have piles of money or owe piles of money. That applies to most Americans. Your investment is an illusion, the same as the thin air that central bankers and banks have created.

The fact remains that there is little monetary defense or value in trying to tell the average American that they can somehow defend their monetary wealth when the central bankers continue to erode that wealth into nothing in a hopelessly compromised financial system. Central bankers are riding the dark horse as they plow the dollar into non-existence so that they can rebuild a new monetary system from the ashes they have created. Naturally, this is to their advantage. The sad thing is that Washington politicians are hopelessly compliant and cooperative in an effort to create a new system from the ashes of your financial lives and years of servitude to their system. We are the fools and most Americans will undoubtedly foolishly listen the advice of the financial sages. What is Washington D.C. up to? CONTROL.  What are central bankers up to? CONTROL. Never forget that what you are being told by mainstream politicians and financial media is designed to secure the system over your life or means of livelihood at your expense.

Gold? Unless you hold the nuggets of goodness in your meaty little hand, don’t buy the snake oil. Gold investment certificates aren’t worth a thunder mug full of waste. Remember the old proverb that possession is nine-tenths of the law. In this case, physical possession is your safest bet, but far from perfect. Your stuff is only as secure as you are. The little guy can easily be pulled from his stuff during a crisis.

I am linking to this electroblurb because it is the right thing to do overall. I do not advocate the sales of the product or the conclusion reached. I ask you to read the facts and forget about buying anything that involves a significant portion of your money, devalued or otherwise, because the money you earn represents your life.

January 5, 2009

The SEC, Madoff and Investment

investment-ponzi-madoffU.S. authorities allege that Bernie Madoff delivered consistently strong returns to clients by secretly using the principal investment from new investors for payments to previous investors, in what is known as a ‘pyramid fraud.’ The Securities and Exchange Commission has known about irregularities for nearly a decade and declined to do anything beyond ignoring the likelihood of fraud.

Laura Cohn of Kiplinger’s, in typical elitist style, asks the question that bears asking. In light of Bernard Madoff’s alleged Ponzi scheme, are you taking steps to ensure that your financial adviser is on the up and up?

The good news is that if you are asking that question, you are still financially solvent (probably) and have still have money concerns like investing. That is good, especially for you. However, all this drama must have you asking the question about why you need to trust all these high-powered frauds with your hard-earned cash rather than gaining investing knowledge yourself. That would be bad for the industry because you wouldn’t need them. Ultimately, that is the economic solution for the fraudsters that put this economy where it is today coupled with the plight of government regulators that couldn’t find their way out of a paper shopping bag.  Do it yourself.

bush-and-sec-coxTo be certain, hundreds of blogs have already been consumed with the utter stupidity of government entities that need to be eradicated entirely because they don’t have a real purpose beyond squandering taxpayer dollars.  Perhaps we can look to President Obama to take some meaningful swipes toward ineffective and largely useless government agencies. The fascinating preponderance of economic, investment and banking fraud that has come to a head should have your head spinning. The fact that these overeducated opportunists and complacent politicians have brought this nation to its’ knees bears repeating.

For years we have been gleefully taught that we can trust others with our money: our blood, sweat and tears. Could we have been duped?  Whom do you trust? You’d better think twice bright eyes. The new President of the United States will be setting the tone for cleaning up the fraud on all fronts. What tone Barack Obama chooses has great importance for anyone that cares about this nation. ~ E. Manning

October 13, 2008

Is a New Era of Economic Finance on the Way?

Britain taking charge

Britain taking charge

While many nations muddle undecisively about their part in the looming global finance crisis, Britain has increasingly taken bolder and more decisive steps in an effort to stem the tide of ruin. Now Prime Minister Gordon Brown is calling for a new financial accord to refashion banking and finance rules for the modern era. “We must now create the right new financial architecture for the global age.”

Many governments in Europe has agreed to follow Britain’s lead by recapitalizing banks and guaranteeing interbank lending. The G-8, of which Britain is a part, are in the planning stages for a meeting soon. “We must now reform the international financial system around agreed principles of transparency, integrity, responsibility, good housekeeping and co-operation across borders.”

Under the British plan, banks that are rescued with taxpayer money will be forced to cease bonuses that have encouraged excessive risk-taking in the past as well as terminating dividends to shareholders. The down side to the bank rescues is that there is currently no incentive for investment and little hope for immediate growth, both hallmarks of the “for profit” market.

While bailing out bankers will sustain the economies for the time being, the end result will be recession coupled with nasty inflation and economic stagnation in some countries if moves are not made to bolster job creation, wages and check price increases. So far, because of credit dependence, nations can expect stymied growth, triggering more defaults and a continuation of tightening lending terms. Nations have been hesitant to guarantee interbank lending because of the trust factor. The pressure is on as the global goal becomes the prevention of a global economic depression.

U.S. economic growth next year will be the weakest since 1954, with unemployment expected to rise to 8.5 percent.

Large corporations are increasingly under the economic gun. American automakers are considering mergers and General Electric is considering a bank charter to provide better funding. Bank lending remains locked down despite flooding the market with monetary credit and interest rate reductions. A continued lockdown will likely result in the depression that scrambling governments are seeking to avoid. Indications are that we are in a global vicious circle of economic decline. The alternative is breaking the cycle. Who is going to break the cycle and how?

British money manager Paul Niven remarked, “We have now entered a new era for global banking. In return for taxpayers’ money, the state will gain a level of control over their governance, pay, and lending practices.” Is Niven’s statement a reality or the work of wishful fiction?

Could the world have the beginnings of a new global banking order or is this move simply an action involving separate economic nationalization of banking and finance to preserve the current financial structure? Perhaps we will know once clearer heads rule the roost. Bible prophecy indicates a new global system that portends to usher in a new era of security. Is there any stock to that? What say you? ~ E. Manning

September 17, 2008

Bailout Fever Strikes U.S. Again

The world of insurance will never be the same. AIG, a major insurance corporation and the world’s largest insurer has averted the worst financial collapse in history by accepting an $85 billion Federal Reserve loan and giving the government a majority stake in the company. The U.S. Treasury was fearful of a “disorderly failure” that would lead to larger national failures.

American International Group was a wild card with failure creating an enormous and unknown measure of system risk to the entire economy. The federal government gets 79.9 percent take of the firm and senior managers give up their jobs.

panic on the street

panic on the street

Meanwhile, the Federal Reserve loan with a 2-year term will allow AIG (in theory) to divest itself of assets in a timely manner without creating an immediate crisis. Stockholders have been effectively squeezed out and are subject to losing any dividends.

AIG was huge in the credit default market, insuring contract guarantees that companies would not fail in large financial deals. A default contract buys protection against the threat of default by a company, municipality or a package of debt backed by mortgages. A buyer pays the seller a premium over a set term. The seller pays out if the default occurs. Defaults on mortgages and securitized bonds brought AIG to the verge of oblivion.

The complexity and global reach is huge, likely affecting every fund on the market in one fell swoop. Even with the loan in place to protect AIG for the short-term, Wall Street is reeling from the effects. A future bankruptcy would also play havoc on business contracts. There are reports that people are hording cash. Derivatives have been a highly profitable on Wall Street until now. The financial world is changing quickly as repercussions from the subprime mortgage crisis ripple across the globe.

~ E. Manning

Older Posts »

Blog at WordPress.com.