World Bank

How The Eurodollar Brought About The Rise Of London Banking

Bankers who took up their business in the Square Mile of London’s banking heart could smell the Eurodollars in the air. As Anthony Sampson wrote, “Young British bankers and their foreign counterparts began to earn higher salaries than other bankers. Skyscrapers shot up by the old classic architecture near St. Paul’s Cathedral. Far Eastern and Arabic banks appeared, as did Mercedes and Cadillacs to cart bankers around the thin London streets.” The Soviet Union and other Eastern Bloc countries needed dollars for trade but wanted to avoid adverse US policy by not keeping or borrowing money in the United States. So they stuck funds in the London offices of British and American banks, causing the City of London to grow as a banking center and recoup some prewar financial glory.

US Taxpayers To Fund Ukraine Bailout With Bond Guarantee

CCC-rated Ukraine is preparing to issue more debt, debt with a Aa+/AAA rating because it will come with the explicit guarantee of the United States of America. In other words, after raiding Greek pensions with the IMF's blessing, the Kiev puppet government is now going after the "full faith and credit" of the US... backed by its taxpayers.  In yet other words, the latest Ukraine "bailout" is courtesy of you, dear US taxpaying reader.

US "Isolated" As Key Ally Japan Considers Joining China-Led Bank

And then there were none. Like dominoes, US allies have fallen in line on the heels of the UK's decision to join the China-sponsored Asian Infrastructure Investment bank and now, the stanuchest supporter of Washington's position on the venture looks set to defect as well.

De-Dollarization Accelerates As More Of Washington's "Allies" Defect To China-Led Bank

"Ignoring direct pleas from the Obama administration, Europe’s biggest economies have declared their desire to become founding members of a new Chinese-led Asian investment bank that the United States views as a rival to the World Bank and other institutions set up at the height of American power after World War II," The Times notes, in yet another indication of declining US influence.

America's European "Allies" Desert Obama, Join China-led Infrastructure Bank

It appears the sea of de-dollarization has reached the shores of Europe. With Australia and UK having already moved in the direction of joining the China-led AIIB, The FT reports that France, Germany, and Italy have now all agreed to join the development bank as 'pivot to Asia' appears to be Plan B for Europe. As Greg Sheridan previously noted, "the saga of the China Bank is almost a textbook case of the failure of Obama’s foreign policy," but as The FT concludes, the European decisions represent a significant setback for the Obama administration, which has argued that western countries could have more influence over the workings of the new bank if they stayed together on the outside. As Forbes notes, this leaves Obama with 3 uncomfortable options...

Frontrunning: March 17

  • Israelis vote as 'King Bibi's' reign hangs in the balance (Reuters), Factbox: Main candidates in Israel's election (Reuters)
  • Iran Can Add Million Barrels a Day of Oil If Sanctions Halt (BBG)
  • Kremlin rules out handing back Crimea to Ukraine (Reuters)
  • Saudi Arabia Needs More Oil to Feed Local Refinery Expansion (BBG)
  • How Lafarge’s CEO Went From Holcim Merger Architect to Obstacle (BBG)
  • When Yellen Gets Less Predictable She’s Getting Back to Normal (BBG)
  • Iran nuclear talks intensify as sides face tough issues (Reuters)
  • Debunking $1.4 Trillion Europe Debt Myth in Post-Heta Age (BBG)

US Attacks "Closest Ally" UK For "Constant Accommodation" With China

The UK has announced it’s joining the Asian Infrastructure Investment Bank, China’s answer to the Asian Development Bank over which Beijing feels the US has undue influence. US wonders aloud if "constant accommodation" is the best way to engage a "rising power".

Frontrunning: March 13

  • Again as first reported here: Record U.S. Oil Glut May Fill Storage, Cut Prices (BBG)
  • IEA sees renewed pressure on oil prices as glut worsens (Reuters)
  • No EU unanimity on renewing Russia economic sanctions (Reuters)
  • Tsipras says Greece doing its part in euro zone deal (Reuters)
  • ECB Set to Buy Fewer Bonds as Price Gains Ease Crunch (BBG)
  • These Americans Are Getting Rich Trading Derivatives Banned in the U.S. (BBG)
  • U.S. 2015 profits forecast to grow 1.7 percent; oil, dollar are concerns (Reuters) - in a month this will say "decline"
  • Manhunt for shooting suspects grinds on in Ferguson, Missouri (Reuters)

The Oil Glut And Low Prices Reflect An Affordability Problem

The oil glut we are experiencing now reflects a worldwide affordability crisis. Because of a lack of affordability, demand is depressed. This lack of demand keeps prices low–below the cost of production for many producers. If the affordability issue cannot be fixed, it threatens to bring down the system by discouraging investment in oil production.

Ukraine, Neocons And Neonazis

There’s simply a very strong feeling, if not conviction, in the western media, that they’ve won the propaganda battle. But two portraits of US girl power in Ukraine from the Guardian and Bloomberg that appeared over the past two days are just unbelievbable. Victoria Nuland and Natalie Jaresko should not be praised by the western media, they should be taken apart bone by bone, because the roles they play are far too shady to stand up to our alleged democratic principles.

When Centralization Scales Beyond Our Control

Who controls NATO, or the IMF? I’m sure you understand it’s not you. Still, when an organization exhibits aggressive behavior in your name, or lends out your money in your name, you should at all times feel that you are in control, through those you elect to represent you. Well, do you? Or are you merely thinking: that’s too far away from me? Organizations, like so many things in life, don’t scale up well, if at all. Beyond a certain critical mass, they become counterproductive, as Illich states. They become predators on their own creators. That goes as much for NATO, IMF and EU as it does for schools and hospitals.