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"It's A Huge Story": China Launching "Petroyuan" In Two Months

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On 8/25/2018 at 8:01 AM, md11fr8dawg said:

What are you gonna replace it with Russia, that worthless currency of yours?? Or maybe that great Euro, or maybe the Iranian Rial ( yeah that's a good one) or maybe the Yuan which China manipulates at will. Up until 1945 England was the world's reserve currency. They lost that status to the US after the war and they seem to have made it pretty well. Would have made it much better if they could control the socialists in their country. 

 

I would think more than likely Gold or assett backed currency.

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On ‎8‎/‎25‎/‎2018 at 9:01 AM, md11fr8dawg said:

 Up until 1945 England was the world's reserve currency. They lost that status to the US after the war and they seem to have made it pretty well.

 

If by well you mean we give them billions and have military bases on their land. Let's hope we don't end up with government charity and foreign military on our shores. JMHO

 

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I believe we stayed their after WW2 because of Russia and the communist alliance and the Berlin wall. It took too long for us to spool up to help them once we decided to enter WW2 in the European Theater and GB was very close to being destroyed. We are not their by force. If the Brits don't want us there then all they need do s ask and I am sure we could use our resources elsewhere. Germany the same thing. Wall is gone but as long as they allow us to stay the less if their $ they have to spend on their defense in the event something comes form the East.

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20 minutes ago, md11fr8dawg said:

I believe we stayed their after WW2 because of Russia and the communist alliance and the Berlin wall. It took too long for us to spool up to help them once we decided to enter WW2 in the European Theater and GB was very close to being destroyed. We are not their by force. If the Brits don't want us there then all they need do s ask and I am sure we could use our resources elsewhere. Germany the same thing. Wall is gone but as long as they allow us to stay the less if their $ they have to spend on their defense in the event something comes form the East.

 

I think you are correct about staying post WW2, but currently we have military in over 100 countries. I just hope if we lose the reserve currency standing, we don't become a country that is under siege for our own safety. I promise you that 100 years ago the people of Great Britain would have never thought they would be in the need of support, much like most of us think about our country today. But history shows us, the only thing constant is change. No world power has stayed on top forever, and the way our country has been run for the past 40 years, we are standing on a slippery slope.   JMHO

 

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Europe Is Working On Alternative To SWIFT For "Financial Independence" From The US

by Tyler Durden

Mon, 08/27/2018 - 11:23

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In the aftermath of a report that Germany was working on a global payment system that is independent of the US and SWIFT, on Monday Germany and France said they’re working on financing solutions to sidestep U.S. sanctions against countries such as Iran, including a possible role for central banks, Bloomberg reported.

"With Germany, we are determined to work on an independent European or Franco-German financing tool which would allow us to avoid being the collateral victims of U.S. extra-territorial sanctions," French Finance Minister Bruno Le Maire said Monday during a meeting with press association AJEF. “I want Europe to be a sovereign continent not a vassal, and that means having totally independent financing instruments that do not today exist.”

The discussions, which also involve the U.K., are a signal that European powers are trying to get serious about demonstrating a greater level of independence from the U.S. as President Donald Trump pursues his “America First” agenda.

After the US reimposed sanctions on Iran, making funding to Iran projects virtually impossible, European companies including Daimler and Total halted activity or backtracked on investment plans to avoid U.S. punishment, but France and Germany and their European Union partners want business with the Islamic Republic to continue.

Le Maire said using the European Investment Bank, which has exposure to the U.S., as a “financial channel” would be “very complicated” and that the French and German governments are talking to their respective central banks about their involvement. “If we want to build a truly independent instrument we must open up all the options,” he said.

Separately, Germany's Foreign Minister Heiko Maas again weighed in on the topic of European financial independence on Monday, saying the EU is working to protect economic ties with Iran and keep payment channels open.

Maas said Europe has started work on creating a system for money transfers that will be autonomous from the currently prevailing Society for Worldwide Interbank Financial Telecommunication (SWIFT).

German foreign minister Heiko Maas 

"That won’t be easy, but we have already started to do that," Maas said at the annual Ambassadors Conference in Berlin on Monday, as quoted by RIA Novosti. "We are studying proposals for payment channels and systems, more independent from SWIFT, and for creating European monetary fund."

Maas also announced plans to reveal a new foreign policy strategy towards the US.

https://www.zerohedge.com/news/2018-08-27/europe-working-alternative-swift-financial-independence-us

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China makes WTO complaint against Washington tariffs

China makes WTO complaint against Washington tariffs
 
 
 
 27 August 2018 09:09 PM

Direct: China filed a complaint to the World Trade Organization against the recent tariff approved by US President Donald Trump on imports of Beijing, in a new escalation of trade impasse between the two biggest economies in the world.

The World Trade Organization (WTO) said on Monday that China had asked it to conduct consultations on the dispute with the United States over its additional tariffs on imports of Chinese goods.

According to the organization, China claims that the additional tariffs applied to China's annual imports worth 16 billion dollars contradict with the provisions of the General Agreement on Trade and Tariffs of the Organization.

Beijing's complaint against Washington means the dispute must be resolved within 60 days or the case will be sent to the WTO dispute settlement body.

The nine countries submitted individual complaints to the World Trade Organization during the last period and most recently Turkey, against the same reason , a Trump definitions.

By 5:29 pm GMT, the Chinese yuan against the dollar fell marginally by 0.07% to record the US paper 6.8156 yuan.

Related Topics Global Events World Economy

https://www.mubasher.info/news/3333472/الصين-تتقدم-بشكوى-إلى-منظمة-التجارة-العالمية-ضد-تعريفات-واشنطن?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+ar%2FISX%2Fnews+(ISX+Arabic+News)

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De-Dollarization Diplomacy: Putin's Wedding Trip Seals Marriage Of Convenience With Merkel

Profile picture for user Tyler Durden
Tue, 08/28/2018 - 09:25

Authored by Pepe Escobar via The Asia Times,

...the meeting in Berlin could signal a switch in strategy for Germany when it comes to the US dollar and energy security...

putin-wedding-960x576.jpg

It was supposed to be a low-key, traditional Austrian wedding until Vladimir Putin pulled up in a black limo. The bride was Austrian Foreign Minister Karin Kneissl, a top energy analyst and former professor at the Diplomatic Academy in Vienna and the European Business School in Frankfurt.

She knows all there is to know about multiple aspects of Eurasia integration, which is close to the Russian President’s heart. So close, in fact, that he stole the show by arriving in a convoy, bearing lavish flowers and the Kuban Cossack Choir.

After a swirl on the dance floor with the blond-haired, but not blushing, bride, he dashed off to Germany for the real business.

 

This was a three-hour, multi-themed, face-to-face meeting north of Berlin with Chancellor Angela Merkel. There were no translators as both are fluent in Russian and German as I pointed out in Asia Times.

But it was Russian analyst Rostislav Ishchenko in a text featuring a Pushkin analogy – and beautifully translated into English – who unlocked these chain of events.

And that brings us to German Foreign Minister Heiko Maas, who wrote in the business paper Handelsblatt about the idea of a European Union payment system bypassing the US dollar, and ultimately, the Iran sanctions.

An alternative system is exactly what the BRICS, namely Brazil, Russia, of course, India, China and South Africa, as well as the China-Russia-Iran triumvirate, have been discussing, and slowly implementing for years.

Now, let us see if we can decode this brand new EU-wide controversy from three different angles. First up, is an aristocratic German financier now based in Switzerland, who insisted on anonymity.

He stressed:

“Too many European [and Swiss] financial institutions [and regulators] are run by Americans. And they are extremely afraid of the American rhetoric of locking them out of Wall Street if they misbehave.”

But wait, there is a snag. Since the days of the Treaty of Rome, the EU has struggled to agree on “even a single important decision related to money, banking, taxes, subsidies … you name it,” he continued. “[Moreover,] the trust by other nations in an ‘EU-leadership’ is even lower than the feared, yet customarily obeyed, US global-leadership.”

“[And] even if they could have a vague attempt at such a large-scale revolution before the croissants are eaten, New York currency traders would have nuked the euro before Brussels had finished its after-lunch siesta,” he added.

Not exactly an EU independence manifesto. As for future prospects for the union, the financier warned:

“In the economy of the future, Europe will be an also-ran. On a five-to-10-year horizon, I see Chinese monetary dominance as inevitable. Forget Europe.”

What the German elite really thinks

Now, compare it with a sharp, shorter-term view by German politico-economic analyst Peter Spengler. He correctly argues that SWIFT, the global banking payments system, is not the problem.

“SWIFT, the world’s largest cooperative payment network, operates under Belgian – that is EU law – which the US Treasury warriors, plus the British GCHQ and the NSA, have been breaking for more than 10 years now, despite protests from the European Parliament,” he said.

“Europe and associated countries and currencies do not need another system, but international law enforcement, and the elimination of the US dollar and hence the New York Fed from payment transactions for real neutral and multilateral clearing.”

It is no secret in Brussels that the EU has been excruciatingly slow in admitting its dependence on Washington. It will be a long and winding road towards “liberation,” even though it has already started.

Still, according to a newsletter circulating among select EU financial circles, German Foreign Minister Maas “did not launch this trial balloon without permission from Merkel.”

“Germany is in deep fear of the Strait of Hormuz being shut, stranding a major supply of her natural gas and oil, and placing her totally dependent on oil and natural gas from Russia,” the newsletter states. “That is why Germany has to hold up the Iranian nuclear deal against all costs.

“Hence, the meeting of Merkel and Putin and the floating of a new currency plan to break the control over Germany and the world of the SWIFT-CHIPS dollar system.”

In practice, “what is prompting Merkel to threaten to move away from the US dollar” is fear, according to the newsletter. There are serious concerns about losing energy shipments from Russia, some of the Central Asian ‘Stans’ and especially Strait of Hormuz-transited oil and natural gas.

Those nightmares could turn into reality if President Donald Trump’s administration succeeded in totally blocking Iran’s energy exports and Iran responded by blocking the Strait.

Bend-not-break

So, Berlin is now engaged in a wobbly “bend-not-break” strategy. Merkel has acknowledged that relations with Washington are fractious while emphasizing the importance of both trade with Iran and US security cooperation.

Nord Stream 2, which was extensively discussed with Putin in Berlin, is a done deal, no matter what Washington says. But that is still not enough for Germany’s domestic needs.

On Saturday, Merkel goes to Azerbaijan to check whether the Caspian-to-Europe Southern Gas Corridor requires further investment and whether it will start delivering energy before 2020.

Many in Germany believe that if ‘push comes to shove,’ the US would not have the military capability to keep the Strait of Hormuz open. And in this case, the EU’s biggest economy could face an energy crisis.

As the newsletter argues, that is why the dismantling of US dollar control of world finance is now being floated by Germany as a matter of safeguarding future growth.

Now, imagine all this being discussed in the open at the planned, one-off, Russia-Germany-France-Turkey summit. And all this because Putin went to a wedding.

https://www.zerohedge.com/news/2018-08-28/de-dollarization-diplomacy-putins-wedding-trip-seals-marriage-convenience-merkel

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The Euro Has the Power to Challenge the Dollar

European Commission President Jean-Claude Juncker isn’t a nationalist populist, but he devoted his State of the European Union address on Wednesday to the defense of “European sovereignty.” This means, among other things, using the euro to challenge the U.S. dollar’s global dominance, particularly in an era of growing American unilateralism.

 
 

“The euro must become the face and the instrument of a new, more sovereign Europe,” Juncker said. “It is absurd that Europe pays for 80 percent of its energy import bill — worth 300 billion euro a year — in U.S. dollar when only roughly 2 percent of our energy imports come from the United States. It is absurd that European companies buy European planes in dollars instead of euro.”

Juncker’s complaints about the dollar-denominated contracts are justified. For example, the EU is the biggest importer of crude oil. 

 
 

Oil Hungry

The world's biggest importers of crude oil including lease condensate*

Source: EIA, author's calculations

*2016 data. In 2017, China surpassed the U.S. as the biggest individual oil-importing country

Yet, according to Eurostat, a vast majority of these imports is invoiced in U.S. dollars.

 
 

So What's Europe's Currency Again?

The EU's trade by invoicing currency, 2016

Source: Eurostat

 

Moreover, half of Europe’s exports are sold in dollars rather than euros. Most of Airbus’s revenue is dollar-denominated, while its costs are incurred mainly in euros, a situation that airplane maker describes as a risk in its financial accounts. The company has even reportedly called on some European suppliers of parts to invoice in dollars. 

This makes little sense, given that the euro is the world’s second-biggest reserve currency and, unlike the dollar, its share of global foreign exchange holdings is growing. A European Commission study of invoicing currencies published in 2016 found that even in the oil and aircraft industries, where dollar invoicing is especially prevalent, executives see no regulatory, legal or accounting obstacles to dealing in euros. This isn’t a matter of thin volumes in currency markets, either: Nobody has a problem buying or selling euros as necessary. 

Yet many European industries see little reason to switch to euros. In some fields, such as energy and aircraft manufacturing, the dollar stands for business as usual. That’s especially important in the oil industry. Some major producing countries — Saudi Arabia, the United Arab Emirates, Oman and Qatar — have dollar-pegged currencies. Besides, the price benchmarks for crude oil are set on two U.S.-based exchanges — the New York Mercantile Exchange and Intercontinental Exchange.

China has tried to challenge the dollar’s dominance in the oil trade. Earlier this year, it launched yuan-denominated oil futures contracts on the Shanghai International Energy Exchange. But they are relatively thinly traded and more volatile than the dollar contracts, in large part because of the currency risk they involve.

Europe, as a bigger oil buyer than China and the issuer of a far more powerful currency than the yuan, would probably stand a better chance of establishing an alternative to the U.S.-based futures markets. And there’s an additional factor that might help: the geography of Europe’s oil sources.

“Any change from the dominance of the US dollar with respect to the pricing and invoicing of the industry would probably be a political issue in which governments of oil-producing countries had an important say,” the 2016 European Commission report said. About 28 percent of EU oil imports come from Russia, which is eager to undermine the dollar’s dominance. Invoicing these supplies in a currency other than the dollar should be feasible, and it would put pressure on other suppliers to shift as well.

Energy isn’t the only area where the euro could challenge the dollar. Collectively, the EU accounts for 15 percent of all international trade in goods, on par with the U.S. and China as a global trade participant. About 93 percent of U.S. trade is invoiced in dollars. If the EU managed to reach that proportion with the euro, it would mean 1.9 trillion euros ($2.2 trillion) a year in additional euro transactions at last year’s trade levels (less without the U.K., but still a mind-boggling amount).

For now, the euro is punching considerably below its weight. According to a European Central Bank report released in July, it has almost caught up to the dollar as a global payment currency, but it’s still far behind in other aspects of global prevalence.

Catching Up Too Slowly

Shares of the top two currencies in the international monetary system

Sources: BIS, IMF, SWIFT, ECB calculations

 

The main reason is inertia. But another major problem is that the EU isn’t seen as a single entity by its global competitors. Juncker understands this. In his speech, he argued that strengthening the euro’s international role requires completing the EU’s economic and monetary union. That task includes common economic policies and budgets, but perhaps a tighter banking and capital markets union would do the job. A common capital market in Europe would have the depth to challenge the U.S. and to establish credible euro-denominated benchmarks.

The July report from the ECB says developing the banking and capital markets union are the two key conditions for increasing the euro’s prevalence. 

It’s not impossible to tip the balance in the international monetary system away from the dollar, and it would be easier for the EU than for China, which is starting in a less advantageous position and is fearful of liberalizing its financial markets. European leaders concerned about President Donald Trump’s erratic behavior and the dangers of continued American dominance should listen to Juncker and the ECB and work on realizing the euro’s full potential. 

https://www.bloomberg.com/view/articles/2018-09-12/currencies-the-euro-has-the-power-to-challenge-the-dollar?utm_source=yahoo&utm_medium=bd&utm_campaign=headline&cmpId=yhoo.headline&yptr=yahoo

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Ray Dalio Spells Out America’s Worst Nightmare

The hedge fund titan warns the U.S. not to take its reserve currency for granted.

Ray Dalio, the billionaire hedge fund manager who founded Bridgewater Associates, effectively spelled out what doomsday looks like for the U.S. on live television.

 
 

In an interview with Bloomberg TV on Wednesday, Dalio expressed his concern about two years from now, when, in his view, the economic recovery is likely to sputter out. It won’t just be a debt problem this time around, he said, but rather a story about unfunded pension and health-care obligations. To address that looming crisis, the U.S. will need to ramp up issuance of U.S. Treasuries.

And that’s where it all unravels.

 
 

“We have to sell a lot of Treasury bonds, and we as Americans won’t be able to buy all those Treasury bonds,” Dalio said. That means foreign investors will have to step up. And they probably would, as long as the dollar remains strong. Otherwise, Treasury’s dollar-denominated interest payments to buyers in China, Europe and Japan will be worth less and less.

 
 

But, to Dalio, that’s not going to happen.

 

“The Federal Reserve at that point will have to print more money to make up for the deficit, have to monetize more and that’ll cause a depreciation in the value of the dollar,” he said. Pressed by interviewer Erik Schatzker, he said, “You easily could have a 30 percent depreciation in the dollar through that period of time.” For context, the Bloomberg Dollar Spot Index fell 8.5 percent in 2017, and that was considered massive.

It all leads up to this critique of how the U.S. has gone on a borrowing binge in recent years. Remember, the $15.3 trillion Treasury market was the $4.9 trillion Treasury market a decade ago.

“We have the privileged position of being able to borrow in our own currency because we have the world's leading reserve currency. We are risking that by our finances — in other words, borrowing too much.”

The idea that the U.S. dollar would lose its status as the world’s reserve currency is an existential threat unlike just about any other to the U.S. government and financial markets as a whole. It’s a talking point that encourages debate, until people realize something else would have to fill that void. And, for that reason, such an Earth-shattering proposition is cast aside.

Coincidentally, Moody’s Investors Service released a report at almost the exact same time that Dalio made his comments, with the conclusion that “The U.S. dollar will remain the dominant foreign reserve currency for the foreseeable future,” which plays “an important role” in maintaining the country’s Aaa credit rating. Here’s more from the report about the dollar:

“Its formidable sovereignty has been maintained through global recessions, defaults by other sovereigns, the rise of Chinese trade and the introduction of the euro. … The size of the U.S. economy and the level of trade are not the only reasons the U.S. dollar is the principal foreign reserve currency. The transparency of the U.S. financial markets as well as the stability and predictability of U.S. monetary policy reinforces the safe-haven legacy that the U.S. dollar holds.”

The caveat in the report, though, is that reserve currencies should be stable and the issuing country should be “highly unlikely” to experience a financial crisis. In Dalio’s view, the U.S. could ultimately face a reckoning, and just how bad it gets depends upon the rest of the world’s faith that the dollar will hold up.

He’s right that fiscal stimulus toward the end of an economic cycle isn’t ideal, in theory. But time and again, the bond markets have shown that deficits don’t really matter. For all the hand-wringing about the increasing size of Treasury auctions, the 10-year yield is still below 3 percent. Inflation is rising but appears contained.

Figuring out an endgame to this period of rampant government borrowing and unconventional monetary policy is a challenge, and Dalio deserves credit for at least trying to picture it. But for just about everyone’s sake, we should hope that he’s wrong.

https://www.bloomberg.com/view/articles/2018-09-12/ray-dalio-spells-out-america-s-worst-nightmare

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 financial crisis awaits the world in 2020 .. Why might this scenario be achieved?

  10199.jpg

 Arab and international

Economy News Baghdad

There are several questions that point to an impending financial crisis in 2020, perhaps even more severe than in 2008. Perhaps the most important is whether global growth will continue next year despite the huge fiscal deficit the United States faces. Are policy makers ready for such a crisis?And what will explode? And when? All of these questions are the subject of the report published on Project Syndicate's website "Brunello Rossa" and "Nouriel Roubini".

The report notes that although the global economy has witnessed consistent growth for a sustained period of time, it will inevitably lose momentum under the unsustainable fiscal policies of the United States, which are gradually declining. The report indicates that by 2020, we will be in a new phase of deceleration. Unlike in 2008, governments will be left with the political tools to meet and manage this phase.

Despite the tenth anniversary of the collapse of Lehman Brothers, the debate is still raging about the causes and consequences of the financial crisis. Have you learned the lessons learned from that crisis well to prepare for the coming crisis? But by looking ahead, the most important question is what will trigger the next crisis and the next global depression? And when?

According to the report, the current global growth is expected to continue next year, taking into account the large fiscal deficit faced by the United States, as well as China's widespread fiscal and credit policies, and keeping Europe on the path of reform. But by 2020, the situation will be fully ripe for a financial crisis, followed by a major global recession.

The report explains that there are 10 factors that cause such a scenario:

First, the report says there is a high probability that current fiscal stimulus policies in the United States will not continue, raising their annual growth rate to above 2%. By 2020, this stimulus will be exhausted and the financial burden will slow growth from 3% To below 2%.

 

Second, the report shows that the US economy is currently deteriorating due to poor timing of fiscal stimulus, as well as higher inflation than the target. Accordingly, the US Federal Reserve will continue to raise the current Fed rate from 2% to 3.5% At least by 2020, which in turn will lead to higher interest rates in the short and long term, in addition to the high exchange rate of the US dollar.

At the same time, inflation is rising in other major economies, and rising oil prices will contribute to additional inflationary pressures. Which means that the other major central banks will follow the Federal Reserve's example in setting that monetary policy, which in turn will reduce global liquidity and put upward pressure on interest rates.

 

Third, the report confirms that Trump's trade disputes with China, Europe, Mexico, Canada, and others will inevitably escalate, which in turn will slow growth and high inflation.

 

Fourthly, the report states that the continuation of other US policies will, of course, contribute to the intensification of the inflationary recession, prompting the Federal Reserve to raise already high interest rates. It is also worth noting that the US administration is placing restrictions on domestic and foreign investment, Resulting in the disruption of supply chains, in addition to restrictions on migrants, which are an urgent need to maintain growth rates in light of the aging of the US population, and that these policies will hinder investment in the green economy, not LED It has a policy of infrastructure to treat supply side deficiencies.

 

Fifth, as for the rest of the world, growth is likely to slow down in the rest of the world. Other countries will see the opportunity to retaliate against US protectionism. China will have to slow its growth so that it can cope with overcapacity and power. Al-Matara, otherwise it will face a severe collapse.As for the already precarious emerging markets, they will continue to be weakened by protectionist policies and the precarious financial situation in the United States.

 

Sixthly, in Europe in particular, the report indicates that it will also see slow growth due to the tightening of fiscal policies and trade disputes. Moreover, populist policies in some countries, such as Italy, may lead to unsustainable debt dynamics within the euro zone. The "ring of death" in which governments and public debt banks will escalate is an existential problem facing an incomplete monetary union suffering from Unequal risk sharing.According to these circumstances, another global recession could lead to the exit of Italy, and perhaps some other countries, from the euro zone altogether.

 

Seventh, the report suggests that the big exaggeration in US and global financial markets may also be a cause. The US price-earnings ratio is 50%, which is higher than the historical average, private equity valuations are overstated, Price, given their low returns and negative surpluses. Moreover, high credit returns are becoming increasingly costly at present, as corporate leverage has risen to historic levels.

Moreover, the amount of leverage in many emerging markets and some advanced economies is clearly overstated. Residential and commercial properties in many parts of the world are very expensive. Thus, equities, commodities and fixed income stocks in emerging markets will continue to correct as global storm clouds continue to accumulate, and as investors anticipate and begin to predict a slowdown in growth in 2020, markets will return risky asset pricing by 2019.

 

Eighth, the report adds that as soon as the correction occurs, the risk of liquidity and price burnings becomes more acute. It should be noted that there is a reduction in the activities of the market and storage industry in terms of brokers and brokers. Consequently, excessive redundancy and algorithmic trading will increase the probability of a "rapid collapse", and fixed income instruments become more concentrated in open trading and private trust funds.

In the event of a reduction in risk, dollar-denominated liabilities in the financial sectors of emerging markets and advanced economies will not have access to the Federal Reserve as the last resort to borrow from. With rising inflation and the normalization of current policies, support from central banks during the post-crisis years is unreliable.

 

Ninth, one of the other reasons cited by the report is Trump's reaction to the 2020 election, explaining that Trump was already attacking the Federal Reserve when the rate of growth was 4% recently, and wondering how he would deal with the matter in the 2020 elections, when The growth rate is reduced to about 1%, and the problem of job losses is highlighted. In this case, Trump will have an attractive opportunity to create a major foreign policy crisis, especially if Democrats can regain the majority in the US House of Representatives this year.

Since Trump had already started a trade war with China and would not have dared to attack nuclear-armed North Korea, Iran was his last best target. By provoking a military confrontation with the country, a geopolitical stalemate shock will be launched that is no different from the rise in oil prices in 1973, 1979, and 1990. And thus it becomes redundant to say that this would create a more severe global recession.

 

Finally, the authors note that once the full storm is mentioned, the policy tools needed to remedy it will not work very well. What the financial stimulus can provide is already constrained by massive public debt. Moreover, the possibility of monetary policies outside the traditional policy framework will be limited by inflated public budgets and the lack of an opportunity to reduce official interest rates. Financial bailout operations in countries that have seen a new boom in populist movements and governments on the verge of bankruptcy will be almost impossible.

In the United States in particular, legislators have constrained the ability of the Federal Reserve to supply non-bank institutions and foreign financial institutions burdened with dollar-denominated commitments with liquidity. In Europe, the rise of populist parties has made it difficult to pursue reforms at the EU level and to launch the institutions necessary to deal with the financial crisis and the coming recession.

The report concludes that unlike in 2008, when governments had the necessary political tools to prevent free fall, policymakers facing the next collapse will find their hands tied, especially after debt levels reached higher levels than during the previous crisis , And when that happens, the crisis and depression may become more severe and longer lasting than the previous one.

Source: Post politicians

http://economy-news.net/content.php?id=13741

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Very interesting... It seems economic experts understand what the American public doesn't.... Our new fiscal policies and protectionism mentality is going to cause a lot of hurt. People who think we can live on an island and not be part of the global economy have been seriously misled by our current administration. The economy is being propped up by tax cuts and corporate welfare that we are now seeing isn't being reinvested, but being used for stock buy backs and bonuses... The tax cuts and their stimulus will be a band-aid on the bleeding wound. The tariffs are only causing other nations to look elsewhere for trading partners... People need to wake up come November or their America First dream will become a nightmare... Our conservative led government is making some very poor fiscal decisions which according to this report will have long lasting affects. JMHO

 

B/A

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What happens to the USA if we keep a 

500 b a year deficient with China and Billions more with other countries like S Korea Canada EU Mexico etc etc. 

 

What happens to US businesses if they are continued to be over regulated and taxed so much they can’t compete. How about small businesses, how are they to compete

 

I could go on and on BA.  Respectfully, the Trump plan to put people to work, get higher wages, be more competable on a world market, with all ethnic Americans getting off welfare and working more, the US Treasury receiving more in taxes ,,,, the plan is working and it will work better when Trump gets better trade deals with other countries like China

 

BA, I resent your continued blasting of our President and your negative articles on the US and the economy. Don’t ever bet against the USA or it’s people. Your candidate lost mainly because the Democrats have no economic plan. The only plan I hear is , “get Trump”. 

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2 hours ago, Pitcher said:

BA, I resent your continued blasting of our President and your negative articles on the US and the economy. Don’t ever bet against the USA or it’s people. Your candidate lost mainly because the Democrats have no economic plan. The only plan I hear is , “get Trump”. 

 

HEAR!!! HEAR!!!

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4 hours ago, Pitcher said:

What happens to the USA if we keep a 

500 b a year deficient with China and Billions more with other countries like S Korea Canada EU Mexico etc etc. 

 

What happens to US businesses if they are continued to be over regulated and taxed so much they can’t compete. How about small businesses, how are they to compete

 

I could go on and on BA.  Respectfully, the Trump plan to put people to work, get higher wages, be more competable on a world market, with all ethnic Americans getting off welfare and working more, the US Treasury receiving more in taxes ,,,, the plan is working and it will work better when Trump gets better trade deals with other countries like China

 

BA, I resent your continued blasting of our President and your negative articles on the US and the economy. Don’t ever bet against the USA or it’s people. Your candidate lost mainly because the Democrats have no economic plan. The only plan I hear is , “get Trump”. 

 

1 hour ago, Synopsis said:

 

HEAR!!! HEAR!!!

What they said!!!!🇺🇸👍

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18 hours ago, Pitcher said:

BA, I resent your continued blasting of our President and your negative articles on the US and the economy. Don’t ever bet against the USA or it’s people. Your candidate lost mainly because the Democrats have no economic plan. The only plan I hear is , “get Trump”. 

 

I'm not sure what you mean... I didn't vote for Trump or Clinton... I refuse to vote for either party whose platforms are to destroy America. If you believe either party is working for America then you are exactly what they want you to be.... Conned.

 

All the data shows that Trump's fiscal agenda is going to take a huge toll on the American citizen. And yes the Democrat's plan of giving away the house is just as foolish. So let's sum it up. The Republicans give everything to the multi-nationals and the Democrats give everything to the worthless and lazy people. Maybe it's time Americans wake up and try something new, like not voting for the crooks.

 

Pitcher I know you are a smart guy and understand the markets, so I find it hard to understand how you can't see what is happening. Corporate welfare doesn't work any better than social welfare. The markets and the valuations are being propped up. The debt, the high values of stocks because of buy backs, and the decrease in income can not be sustained. And we are now seeing the rest of the world looking to do business elsewhere.

 

So you saying I'm anti-American is a misrepresentation. What's anti-American is what both parties are doing to our country and people who blindly support those parties are contributing to the ever decreasing standard of living we are seeing day in and day out. The 200,000 jobs a month being created and low wage jobs.

 

Why is consumer debt at all time highs? Sure we can say people live outside their means, but honestly, could you support your family on $15 per hour... That's what we are seeing. American workers are becoming the low wage workers that companies want.  In my town the government gave Volkswagen huge tax breaks to build their plant here. They took the welfare and are paying American workers half what they pay their own people in Germany. Americans have been conditioned to be desperate enough to take any job and be happy about it. Our government being bought and paid for, and the politicians who are cashing in are doing it at the cost of the American dream. So keep supporting your favorite party whichever one it is and in 20 years explain to your grandchildren why they are living a life without the amenities you and I were able to enjoy.

 

B/A

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9 hours ago, bostonangler said:

Pitcher I know you are a smart guy and understand the markets

 

I am a smart fellow and I do understand the markets perfectly.  In the last 18 years I’ve been in cash 3 times. Late 1999, late 2007, and most of 2018. I have developed proprietary timing mechanisms that get me out.  To make my money I Day Trade or Swing Trade during those periods.  I’ve had a great year trading so far.  Like you said I am a smart fellow.  

 

Here is a little bit of advice for you.  Everything you read is not as it appears, especially when the article you were referencing was written by a Hedge Fund known for shorting the market (I never read those guys articles.and I stopped listening to economists years ago). All markets have cycles and the current market is no different.  Will we have a correction, 100% yes, when, no one knows for certain!!  Are we close, maybe, probably, it’s been a 10 year Bull run.  What kills Bull markets? Lack of earnings, guidance for lower earnings, higher interest rates, some black swan event.  The best any investor can do is be prepared for any event. For an easy heads up, when you see the 50 ma, cross the 200 ma down on the S&P Daily Chart be prepared to take some off the table.  

 

One more bit of advice, stop worrying about Trump.  He’s not destroying the US.  He’s trying to help it even for the ones (Dems, Many Reps, all Socialists) trying to impeach him, destroy him, bock him, and resist him.  His style and morals are not my way but make no doubt about it, his policies ARE working.  You don’t like him I get it, go vote for Pelosi, she’s trying to help the USA, NOT!!!!

 

i would like to hear your take on HRC lawlessness, the DOJ that covers for her, and the FBI that would not bring her to justice for her crimes.  I would like to hear what you have to say about the recent NYT’s article, Russian Collusion, Barry’s Nuclear Deal that was a complete destabilizing event for the ME.  I would like to hear your opinion on Barry’s Administration not securing our borders and allowing Sanctuary Cities.  I would like to hear your opinion on Barry’s shovel ready jobs and a 10 trillion budget deficit during his 8 years.  How about Barry’s Obama Care Act passed and crammed down the US people’s throats, knowing that it was designed to failure to get a single payer healthcare system and to control 1/5 of the US economy.  

 

Look I get it, you are LEFT leaning and your candidate got smoked.  It hurts but you’ll be fine, eventually.  Bashing Trump and Conservatives may make you feel better but it’s only delaying your recovery.  Let it go and go vote for some Socialist Democrat in a few weeks. 

 

I apologize for being so full of contempt but I meant it when I said in my last post, I resent your continued bashing of our President just because you don’t like him.  I don’t necessarily dislike you and I don’t Red ruby but if you are a true seeker of the truth then you and a few others on this site would answer my earlier questions.  If you are a truth seeker then you should discuss or state what HRC and her supporters in the DOJ and FBI have done to harm the Constitution.  

 

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I always enjoy this thread as I come and catch up from time to time..........many great articles and posts......

 

My 2 cents worth is there is a tremendous pull/fight going on between the East and West for financial dominance......

 

The West is trying to hang on/ improvise.....The East is looking to change things up.......

 

2020 looms large in my mind.........however this is going down.........it will be by then....

 

The West needs to create something to produce some funds to reduce world debt........

 

That would be what I call a GCR.....or Global Currency Reform.........and this would involve a currency adjustment based on assets/debts a country holds....

 

Currency is only as valuable as the confidence that the people/world have in it...........

 

Right now the world is cluttered with worthless paper that people are losing faith in.......

 

Thus the introduction of the petroyuan.........backed by gold.....

 

I believe the IQD plays into the plans by the West........

 

Is it all "smoke and mirrors" ?.........no matter......as long as it works

 

I mean look at what Brasil did with the REAL...........value created out of thin air........and the people bought in......

 

I could go on.........but work calls........

 

Thanks for all the efforts on this thread......it is one of those that are more valuable here on DV.....

 

CL

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13 hours ago, coorslite21 said:

2020 looms large in my mind.........however this is going down.........it will be by then....

 

I totally agree... Whatever those who control the money will make their change before the 3030 election...

 

B/A

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17 hours ago, Pitcher said:

 

I am a smart fellow and I do understand the markets perfectly.  In the last 18 years I’ve been in cash 3 times. Late 1999, late 2007, and most of 2018. I have developed proprietary timing mechanisms that get me out.  To make my money I Day Trade or Swing Trade during those periods.  I’ve had a great year trading so far.  Like you said I am a smart fellow.  

 

Here is a little bit of advice for you.  Everything you read is not as it appears, especially when the article you were referencing was written by a Hedge Fund known for shorting the market (I never read those guys articles.and I stopped listening to economists years ago). All markets have cycles and the current market is no different.  Will we have a correction, 100% yes, when, no one knows for certain!!  Are we close, maybe, probably, it’s been a 10 year Bull run.  What kills Bull markets? Lack of earnings, guidance for lower earnings, higher interest rates, some black swan event.  The best any investor can do is be prepared for any event. For an easy heads up, when you see the 50 ma, cross the 200 ma down on the S&P Daily Chart be prepared to take some off the table.  

 

One more bit of advice, stop worrying about Trump.  He’s not destroying the US.  He’s trying to help it even for the ones (Dems, Many Reps, all Socialists) trying to impeach him, destroy him, bock him, and resist him.  His style and morals are not my way but make no doubt about it, his policies ARE working.  You don’t like him I get it, go vote for Pelosi, she’s trying to help the USA, NOT!!!!

 

i would like to hear your take on HRC lawlessness, the DOJ that covers for her, and the FBI that would not bring her to justice for her crimes.  I would like to hear what you have to say about the recent NYT’s article, Russian Collusion, Barry’s Nuclear Deal that was a complete destabilizing event for the ME.  I would like to hear your opinion on Barry’s Administration not securing our borders and allowing Sanctuary Cities.  I would like to hear your opinion on Barry’s shovel ready jobs and a 10 trillion budget deficit during his 8 years.  How about Barry’s Obama Care Act passed and crammed down the US people’s throats, knowing that it was designed to failure to get a single payer healthcare system and to control 1/5 of the US economy.  

 

Look I get it, you are LEFT leaning and your candidate got smoked.  It hurts but you’ll be fine, eventually.  Bashing Trump and Conservatives may make you feel better but it’s only delaying your recovery.  Let it go and go vote for some Socialist Democrat in a few weeks. 

 

I apologize for being so full of contempt but I meant it when I said in my last post, I resent your continued bashing of our President just because you don’t like him.  I don’t necessarily dislike you and I don’t Red ruby but if you are a true seeker of the truth then you and a few others on this site would answer my earlier questions.  If you are a truth seeker then you should discuss or state what HRC and her supporters in the DOJ and FBI have done to harm the Constitution.  

 

 

I agree with most of your comment... Your point about the market cycling is spot on and we are seeing the changes you mention... Higher interest rates (already started), lower valuations and earning (just about to come out), a global event (could happen at any minute, but most likely not until se head into 2020).

 

As for Trump and Clinton and the rest of the D.C. bozos. I don't agree with you, if you think they are working against each other. To me they are like WWF wrestlers. I have worked with them. On stage, in the ring, they are mortal enemies. But backstage in the Green Room they are buddies sharing food, beverages and big laughs. Trump, Clinton and the rest of them put on a big show in public, but backstage they are laughing while they are cashing in. Hell, they go to each other's weddings, parties and more. They are con artists whose main objective is to divide the public with emotional issues while they pat each other on the back and drink the best champagne and eat the finest foods all served to them as though they are royalty.

 

So your statement about me backing Dems is way off base. You are making emotional judgements, just the way they hope people will. I have stated so many times, I didn't vote for Clinton that those keys are wearing out on my keyboard. Don't jump to those obvious conclusions... I have always voted for the person and not the party. Like in our most recent primary, I voted for a republican for governor because he is the best person, I don't care what party he is in. 

 

As for the FBI or Justice Department, there are tens of thousands of good honest people doing their best. It is only those at the top appointed by the paid-off politicians who are corrupt. So I don't blame the people working there I blame the system. Remember the slogan Drain the Swamp? It ain't happening. In Tennessee we have Trump backing Marsha Blackburn who has been in Washington for 18 years, taken huge amounts of money from special interest groups and yet he backs her... Nothing has changed with yet another con man.

 

The two party system is a joke. Until Americans realize we need to bust up the system we are doomed. But these pros have completed brainwashed Americans into thinking there can be no other option, and that is the sad part.. So keep on voting republican and keep on voting against something instead of voting for something and see if things ever get better. That's right things have become so bad, that people vote against instead of for... Think about that. We used to vote for... I know some will jump on this and say they voted for Trump, but did they vote for increased spending, higher national debt? I doubt it.. In reality those people voted against Clinton. Just like a lot of Clinton voters weren't voting for her plans, they were voting against Trump... Maybe disenchanted voters should try voting for a third party an outsider... It's just a thought.

 

B/A

 

 

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27 minutes ago, bostonangler said:

 

I totally agree... Whatever those who control the money will make their change before the 3030 election...

 

B/A

 

Sorry that was some wacky typing... I just got in from the dentist and I see I was a few keys off... LOL I meant the 2020 election and whoever controls the money... Wow, I didn't know Novocain had that effect.

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BA I apologize if my post was too condescending. I get cranky from time to time and shouldn’t post. I’ve made a few terrible posts in the last week because I can see what’s coming and it is very frightening.  I do believe the USA will come out fine in the long run but the next 2 years will be very contentious.  

 

Cl, Thank you for your reply.  I always enjoy your perspective.  

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4 minutes ago, bostonangler said:

To me they are like WWF wrestlers

  

I like this sentence, very true

 

5 minutes ago, bostonangler said:

As for the FBI or Justice Department, there are tens of thousands of good honest people doing their best. It is only those at the top appointed by the paid-off politicians who are corrupt

 

I agree

 

Be careful what you wish for in a third party.  Imo, it’s just a matter of time before we have a Hispanic Party or a minority majority party.  They will have the numbers in the next 20-40 years if not sooner in some states like Cali and Texas.  

 

Yes, I am maybe too emotional because I have been reading a lot about the Deep State and it’s many many abuses.  It makes me fighting mad as hell.  Apologies for taking it out on you but you have to admit many of your posts are written to agitate conservatives on this site.  

 

 

 

 

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