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An IMF Absurdity
Wolf Richter www.testosteronepit.com
On April 20, the finance chiefs and central bank governors of the Group of 20 will hold a shindig in Washington DC, at the margin of the biannual meeting of the International Monetary Fund and the World Bank. At issue is money. Bailout money for the Eurozone. The IMF wants to dig deeper into its pocket, but the amounts are skyrocketing, and ... “We certainly need more resources,” explained IMF Managing Director Christine Lagarde on Tuesday.
The IMF estimated in January that it would need an additional $500 billion, on top of the $400 billion it already has. The idea of bringing its resources up to $1 trillion has been floated. Surely, after $1 trillion, there will be $2 trillion. Once it starts, it’s never enough—especially with Spain and Italy tottering, despite Italian Prime Minister Mario Monti’s assurances to the contrary. For how his reforms face stiff and sometimes tongue-in-cheek resistance, read.... No More Viagra for Mario Monti and his Ilk.
But there has been some reluctance to handing the IMF more money, notably from the US and Japan, its top two stakeholders. Bailing out the Eurozone should be Europe’s job, they argued. And so the Eurozone countries finally pledged to put $200 billion into the IMF’s kitty and raise their bailout funds to $1.1 trillion, though every penny would have to be borrowed. That was last week. And now all eyes are on Japan.
Japan is the biggest debt sinner of all developed countries. By the end of the fiscal year on March 31, 2013, Japan’s public debt will surpass one quadrillion yen, or $14 trillion, a breathtaking 240% of GDP. Of the current budget, which hasn’t been passed yet, a mindboggling 56% will have to be borrowed—with the help of the Bank of Japan, which announced that it would massively monetize the deficit. Budget cutting has been under way in a manner that the budget actually increased. The only real effort to address the problem is the highly unpopular increase in the consumption tax winding its way through the Diet. But if it becomes law, the first increase from 5% to 8% won’t even take effect until April 2014, and the second increase to 10% won’t take effect until October 2015. For Japan’s vertigo-inducing debacle, read.... Unpopularity Contest at the Edge of the Abyss.
And yet, in a sign of just how absurd the situation has become, it is precisely Japan which suddenly appears to be willing to bail out the Eurozone—where even Greece is fiscally sounder, if that word can be applied that way, than Japan.
"I believe it would be good for the markets and the global economy if we can reach a certain level of progress when we gather in Washington," said Japanese Finance Minister Jun Azumi on Tuesday. Japan would be ready to play a key role because it appreciated “to some extent” the increased efforts by the Eurozone to bail itself out, he said.
A variety of proposals are already under consideration, such as a loan of $50 billion to the IMF's general account, but Azumi remained vague. "We will decide on how we could contribute, as well as whether we would call for further efforts by Europe,” he said.
Once Japan agrees to wade even deeper into its own quagmire by sending more money to the IMF, all eyes will turn to the US, the last holdout, whose public debt now exceeds 100% of GDP, and whose budget deficits—if Congress ever passed a budget—are worse than those in the Eurozone. Convincing Congress might be a slog. But then there’s always the Fed with its unlimited power to bail out bondholders wherever they might be. So the Eurozone, the G-20, and the IMF might come together to bail out Spain’s bondholders, and perhaps Italy's bondholders, at great expense to taxpayers everywhere.
Meanwhile, the ECB, under new management and despite apparently fake German reservations, has jumped on the money-printing bandwagon where it happily joined the Fed, the Bank of Japan, and other central banks. The endless flow of money has started in the Eurozone. And the wily Greek political elite has figured this out. Read.... Greece: They’re Not Even Trying Anymore.
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Founding fathers had no inkling that a government would start to issue budgets that were unbalanced, much less not issue them at all, it really is getting absurd
The insanity has to end ...
FYI: US taxpayers have never lost a penny through IMF. In fact, over the years the US Treasury/Central bank have earned over one billion; the reason being that whenever the US's dollars are used by the IMF for its lending, the US is paid interest. FACTS only please; check your sources.
FYI: study the term "opportunity costs".
What could America have done with all that money if it didn't park it at the IMF?
Next, read "Confessions of an Economic Hitman". Learn how those loans are used.
Next, let us know how you found out about the IMF accounting methodology and determined everything they are telling us is correct.
Next, realize all those currency contributions were "borrowed" into existence and therefore pay interest on a debt. This interest is not balanced against any interest paid to the US.
Even if that could be somehow be substantiated as true, which it can't, it still doesn't mean the great unwashed shouldn't inquire into the use of 'funds' derived from their labor.
Ah, I see now -- 18 weeks 3 comments = job well done. Trollrific...
The hurry carry trade will become the hari kiri trade!
Now just remember who all these actors on the world stage are, cause when the shit hits the fan we'll go after them all with pitchforks. Their money won't be able to buy enough security for themselves. Dead ducks.
From Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism:
'Following the ThirdWorld debt crisis of 1982, the roles of both the IMF and
theWorld Bank changed dramatically. They started to exert a much stronger policy
influence on developing countries through their joint operation of so-called
structural adjustment programmes (SAPs). These programmes covered a much
wider range of policies than what the BrettonWoods Institutions had originally
been mandated to do. The BWIs now got deeply involved in virtually all areas
of economic policy in the developing world. They branched out into areas like
government budgets, industrial regulation, agricultural pricing, labour market
regulation, privatization and so on. In the 1990s, there was a further advance in
this ‘mission creep’ as they started attaching so-called governance conditionalities
to their loans. These involved intervention in hitherto unthinkable areas,
like democracy, government decentralization, central bank independence and
corporate governance.
This mission creep raises a serious issue. TheWorld Bank and the IMF initially
started with rather limited mandates. Subsequently, they argued that they have
to intervene in new areas outside their original mandates, as they, too, affect
economic performance, a failure in which has driven countries to borrow money
from them. However, on this reasoning, there is no area of our life in which the
BWIs cannot intervene. Everything that goes on in a country has implications
for its economic performance. By this logic, the IMF and theWorld Bank should
be able to impose conditionalities on everything from fertility decisions, ethnic
integration and gender equality, to cultural values.' (bold emphasis mine)
p.15-16
For the most part people in the West are clueless about the degeneration of the BWIs and their 'mandates'. Under the guise of 'Peace' and 'Stability' these institutions now have become the exact opposite in their goals despite the rhetoric.
It certainly looks like social engineering to even the least conspiratorially minded of persons doesn't it? Whether this is just Procrustean madness or the actual intent of remaking of people in the image of the Chosen Few is beside the point. As it goes: 'The road to hell is paved with good intentions'.
Financial racketeering IS social engineering, Captain Obvious.
They conjure fraud-fiat in your name, and then the nameless and faceless buy your politicians through corporate proxies insulated from the law with your debt.
Anything else in the universe use "money?" That's weird... must not be important except to oppress man.
Fasists Inc. aren't smart; its the world that is that dumb!
FUCK THE FED! END IT!
The waiting for it all to collapse can be so difficult at times.
So true. It seems like this is going to take forever. How much longer can this possibly go on? It's madness.
US citizens work to deplete the earth from its resources.
Their debt story is an efficient way to achieve that goal as they are able to activate consumption on the ground that the more it is consumed now, the more it will be consumed in the future.
US citizens have already written off billions of people accross the world as they are going to be on the rough end of the stick (not US citizens as US citizens love to claim)
Living frugally, within your means is a lethal piece of advice.
The reality of this US driven world is consume as much as you can, by any means you can figure out because if you spare resources, a US citizen will consume them.
That is why there are so many fat people addicted to cheap quality in US citizen nations, overconsuming food and junk items is the poor's way to weigh in the consumption race.
What else could they overconsume with their discretionary income closer to zero than anything else?
In the end, it will mean to simply blow things up in order to deprive a competitor in the great consumption game launched by US citizens.
"deplete the earth from its resources"?
"they are able to activate consumption"?
"Living frugally, within your means is a lethal piece of advice"?
AND SO ON. . .
What the hell are you talking about?
One might argue that is what is happening in the EU in slow motion right now already.
It only hurts when I am forced to think about it... Other than that, it's way peachy...<sarc off>
Blink...
All in.
Lagarde has an unusually large adams apple, for a woman
Schnauble gave it to her. She refused to give it back.
Fuck the IMF. At one time i'd say oh it would be a shame if Alqueda blew your asses up. Then I found out the IMF is ran by the US. And so are the towelheads. What a fk'd up world we live in!
Dear IMF
The great county of WANTFREECASHASTAN has fallen on hard times and is in need of immediate assistance. Our once respected and powerful nation has no assets and produces nothing of real value - however we do have an unlimited supply of debt we can post as collateral. Please send cash, as the payday loans place won't take our checks anymore.
The IMF will undoubtedly agree that economic stability is critical to the global community - so GIMME. We are not without a growth plan however - we intend to invest heavily in incandescent light bulbs and gold paint...for no particular reason.
Thank you for giving this matter due consideration and for not asking too many questions.
Rothschields? More like ol'Scratch himself is more like it. I'm glad you kept it short Wolf, because it draws more attention to its absurdity that way. It's so fucking nuts you're stunned by the time you're finished reading, and I don't give a hoot who you are, it has an impact. Well, it requires one big fucking hair-cut, and the best place to start is by taking Congress over on November 6th, 2012. If Congress starts handing out hair-cuts the world will be forced to follow, they always do. If you would like to see the plan to organize 162,000,000 American registered voters to elect a Congress that will take back its constitutional powers/duty (per article I Sec 8&9), and the petition that will serve as the litmus test for anyone who wants your vote go to, www.nar2012.com. We attack on November 6th, 2012. Serfs Up American!
Ahh ok, I understand now, that makes sense, everything is clear to me now.
And the Rothschilds cross thier legs and smile :0)
How appropriate they're meeting on 4/20, as they'll be having to be smoking a lot of dope, to get around these numbers..... I'm sure Timmy G. will be there ready to supply the world it's new stimulus....
that meeting is a big deal actually. "by that time the EU may be in a full fledged crisis." Japan...ahem..."extending credit to the EU"...would be quite the sight to behold. "here's 50 billion" is quite the put down. will it be followed by a "there's more where that came from" moment? "how is one to know whether an irrational....
http://www.youtube.com/watch?v=5mhHY44eF8I&feature=player_detailpage
thank God those days are behind us!
When money can be created from nothing on the whim of a Central Banker,
all things are monetarilly possible. Who's going to blow the whistle on the scam,
when just about everyone in the world depends on newly printed money in some way.
This Great Ponzi could go on a lot longer than most people believe. God help us when it stops.
International Monetary Fuckers (IMF)
Absurdity is the right word. The entire world economy is one big bundle of fraud, where the powers that be print money, in the hopes that they have dumbed down the public enough for them not to stop accepting payment in worthless paper fantasy money.
But this has all happened many times before and will happen many times again. This civilization shall crash and a new one will spring from it's ashes. Of course, with nukes involved, the word ashes will no longer be a metaphor.
If you want to survive what is coming, read:
http://www.amazon.com/Simple-Wealth-Mr-Andrew-Costello/dp/1463523017/ref
Could we not just skip right to the 500 trillion dollar notes , Zimbabwe eventually got there. I know we can do at least that good!
Zimbabwe had its money turned down by the exterior at one moment. The exterior demanded to be paid with something else than Zimbabwe money.
This was the triggering event.
US citizens know their history and have worked to minimize the risks of holders of mattering goods to turn down their money.
Hyperinflation through increase of money supply wont happen.
What other choices are there for a country that spends %40 more than it takes in and a central bank that has to buy 2/3 of it's debt? The result of printing money is always inflation and at this pace Hyper-inflation is the only logiccal answer.
So Japan says we can run our debt up to at least 240% of GDP. Why do we think we're in trouble at 100% of GDP? Why not send every taxpayer his/her share of the 15T difference and light this candle? That'll get things going at least as good as Japan is right? Their market is down 75% from its peak over 20+ years. We can match that in a hearbeat.
the IMF's Christine Lagarde is in America pleading the case for international help (charity) for the crumbling (in Govt debt) Eurozone ..."our problem is your problem"
of course when countries can't deal with their own problems, because they're both too inept, too spineless and too corrupt to, they look for the easiest route (being cowardly politicians) for bailouts from other countries
when an entire continent is completely incontinent they look to other continents
this is the suicide socialist way of stacking shit on top of shit so high you know sanity has long left the building
my advise, give Lagarde the fat finger and a kick up the arse just for good measure
And if you get late on those taxes you owe, the govt will suspend or take away your passport.
http://losangeles.cbslocal.com/2012/04/04/owe-the-irs-bill-would-suspend...
Dominica 2nd passport $130k for single person, $160k for a family of four
Radioactive cesium has been found in fish caught 198 km south of Fukushima reactors. (www.enenews.com). Fish caught on 3/28/12 tested 426 becquerels radioactive cesium, four time higher than Government allowed limit. When will a class action lawsuit be filed against Japan for the damage being done to the US citizens?? This is a real problems central bankers can't begin to solve. On yes, lets talk about something important like the openning of baseball season or the NFL draft. To hell with radiation.
Sure, American fishers could sue the Japanese government, which could sue TEPCO, which could sue General Electric which designed and built the plant, which would need a bailout by the US Government. However, the only people who would gain from this would be lawyers at each step of the way. Better for the American government just to bail out the fishing industry directly.
all the CB's can go ......http://www.youtube.com/watch?v=pfE_98yy2iw&feature=related
Where is the fairness?
http://annoyanidiot.blogspot.com/
April 20th, you say? A nice birthday gift for Hitler.
Gerald Celente says this is all very bullish for the guillotine manufacturers.
They are the clowns. Just wish someone would smear some red powder on them so that their faces shows it.
Ben wants that statue of himself as the saviour of Europe.
Secetly buying their junk no less.
When the music stops everyone will be surprised because THERE WILL BE NO FUCKING CHAIRS.
Tell me again, Virginia, how many countries in the IMF aren't already indebted to the gunnels ?
He should get the Napoleon Benocide statue done by Banzai7 the other day.
I hope they order the clowns for the party
they're already in situ in every Finance Ministry in every Govt on the planet