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BRICS Announce $100 Billion Reserve To Bypass Fed, Developed World Central Banks

Tyler Durden's picture


As we suggested last night, the anti-dollar alliance among the BRICS has successfully created a so-called "mini-IMF" since the BRICS are clearly furious with the IMF as it stands currently: this is what the world's developing nations just said on this topic "We remain disappointed and seriously concerned with the current non-implementation of the 2010 International Monetary Fund (IMF) reforms, which negatively impacts on the IMF’s legitimacy, credibility and effectiveness."

As Putin explains, this is part of "a system of measures that would help prevent the harassment of countries that do not agree with some foreign policy decisions made by the United States and their allies." Initial capital for the BRICS Bank will be $50 Billion - paid in equal share among the 5 members (with a contingent reserve up to $100 Billion) and will see India as the first President. The BRICS Bank will be based in Shanghai and chaired by Russia. Simply put, as Sovereign Man's Simon Black warns, "when you see this happen, you’ll know it’s game over for the dollar.... I give it 2-3 years."


A quick take on existing monetary policy.


The punchline, however, is that using bilateral swaps, the BRICS are effectively disintermediating themselves from a Fed and other "developed world" central-bank dominated world and will provide their own funding.

We are pleased to announce the signing of the Treaty for the establishment of the BRICS Contingent Reserve Arrangement (CRA) with an initial size of US$ 100 billion. This arrangement will have a positive precautionary effect, help countries forestall short-term liquidity pressures, promote further BRICS cooperation, strengthen the global financial safety net and complement existing international arrangements.... The Agreement is a framework for the provision of liquidity through currency swaps in response to actual or potential short-term balance of payments pressures. 

Incidentally, the role of the dollar in such a world is, well, nil.

For those who have forgotten who the BRICS are, aside from a droll acronym by a former Goldman banker, here is a reminder of the countries that make up 3 billion in population.

Key excerpts from the Full statement:

We remain disappointed and seriously concerned with the current non-implementation of the 2010 International Monetary Fund (IMF) reforms, which negatively impacts on the IMF’s legitimacy, credibility and effectiveness. The IMF reform process is based on high-level commitments, which already strengthened the Fund's resources and must also lead to the modernization of its governance structure so as to better reflect the increasing weight of EMDCs in the world economy. The Fund must remain a quota-based institution. We call on the membership of the IMF to find ways to implement the 14th General Review of Quotas without further delay. We reiterate our call on the IMF to develop options to move ahead with its reform process, with a view to ensuring increased voice and representation of EMDCs, in case the 2010 reforms are not entered into force by the end of the year. We also call on the membership of the IMF to reach a final agreement on a new quota formula together with the 15th General Review of Quotas so as not to further jeopardize the postponed deadline of January 2015.


BRICS, as well as other EMDCs, continue to face significant financing constraints to address infrastructure gaps and sustainable development needs. With this in mind, we are pleased to announce the signing of the Agreement establishing the New Development Bank (NDB), with the purpose of mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging and developing economies. We appreciate the work undertaken by our Finance Ministers. Based on sound banking principles, the NDB will strengthen the cooperation among our countries and will supplement the efforts of multilateral and regional financial institutions for global development, thus contributing to our collective commitments for achieving the goal of strong, sustainable and balanced growth.


The Bank shall have an initial authorized capital of US$ 100 billion. The initial subscribed capital shall be of US$ 50 billion, equally shared among founding members. The first chair of the Board of Governors shall be from Russia. The first chair of the Board of Directors shall be from Brazil. The first President of the Bank shall be from India. The headquarters of the Bank shall be located in Shanghai. The New Development Bank Africa Regional Center shall be established in South Africa concurrently with the headquarters. We direct our Finance Ministers to work out the modalities for its operationalization.


We are pleased to announce the signing of the Treaty for the establishment of the BRICS Contingent Reserve Arrangement (CRA) with an initial size of US$ 100 billion. This arrangement will have a positive precautionary effect, help countries forestall short-term liquidity pressures, promote further BRICS cooperation, strengthen the global financial safety net and complement existing international arrangements. We appreciate the work undertaken by our Finance Ministers and Central Bank Governors. The Agreement is a framework for the provision of liquidity through currency swaps in response to actual or potential short-term balance of payments pressures.

Goodbye visions of an SDR-world currency. As for the USD...


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Tue, 07/15/2014 - 14:40 | 4959918 PacOps
PacOps's picture

Faster please.

Tue, 07/15/2014 - 14:46 | 4959944 Manthong
Manthong's picture

The Rooskies will have a lot of fun sticking it to the Fed.

Tue, 07/15/2014 - 14:53 | 4959992 Pladizow
Pladizow's picture

Martin Armstrong: Killing the dollar

The recent attempts by the USA to impose huge fines on foreign banks for violating US sanctions with Iran based solely on transactions in dollars is having the same impact as FATCA. The US Justice banking penalties are becoming a threat to the dollar being used in such transactions. While this is unlikely to cause the decline in the dollar as a reserve currency, for transactions, firms and banks are starting to plan to replace the US dollar as a trading currency. This growing fear of the future penalties from the US authorities is starting the process in motion whereby we will eventually move to a new international reserve currency.

The efforts of Russia and China to establish trade in their currencies is interesting but not a threat to the reserve status of the dollar. That is separate and distinct from the trading status of the dollar. One can trade in any currency, but where do you park money? That can still only be the dollar where there is a deep market (reserve). So we must separate the dollar into these two primary categories – trade and reserve. They perform two distinct functions. The Euro never got off the ground as a reserve currency and is second to even the Chinese yuan in trade. Because the Euro would not create a consolidated debt, they prevented the second prong from forming – the place to park money.

You can conduct trade in yuan, but you cannot park trillions of dollars in yuan or rubles no less euros. So you trade in whatever you like, but you convert to dollars to bank it. Major banks can switch out of dollars to for any transaction thereby avoiding US sanctions. After the transaction takes place, the parties can flip into dollars to park it. The US Justice Department will then be defeated.

Nevertheless, FATCA and the drive to punish foreign banks with billions in fines for acts outside the USA is creating the subtle shift toward a world currency at the reserve level for trade and parking. This trend is in motion always. Whatever these people can do to serve their personal interests will set in motion the ultimate drive to a new world reserve currency that cannot be based upon any single nation.

Tue, 07/15/2014 - 15:00 | 4960029 ilion
ilion's picture

I always admire the BRICS in talking about the demise of the dollar but at the same time they establish a fund that is based in US dollar.

Tue, 07/15/2014 - 15:02 | 4960040 Tjeff1
Tjeff1's picture

No they did not.  The amount is the equivalent of USD.  Not in USD.

Tue, 07/15/2014 - 15:05 | 4960061 Xibalba
Xibalba's picture

Based on the price of paper metals, this is obviously obvious.  

Tue, 07/15/2014 - 15:23 | 4960146 linniepar
linniepar's picture

Will this be a catalyst for moar woar?

Tue, 07/15/2014 - 15:46 | 4960244 Killer the Buzzard
Killer the Buzzard's picture

Why not park it in physical gold instead of USD?

Tue, 07/15/2014 - 15:53 | 4960278 THX 1178
THX 1178's picture

Sorry James Rickards, no SDR for you.

Tue, 07/15/2014 - 16:00 | 4960306 outamyeffinway
outamyeffinway's picture

BRICS leaders are also expected to sign an agreement to establish an additional $100 billion fund to steady the currency markets.

"We have reached an agreement that, in the current conditions of capital volatility, it is important for our countries to have this buffer a so-called “mini-IMF”- a financial organization which could quickly react to capital outflow, providing liquidity in hard currency, in particular in US dollars,” Siluanov said.


Tue, 07/15/2014 - 16:07 | 4960336 THX 1178
THX 1178's picture

Now that the conceptual infrastructure is in place, a collapse could easily be a catalyst for massive expansion of the size of this reserve.

Tue, 07/15/2014 - 16:19 | 4960347 Save_America1st
Save_America1st's picture

Jim Willie's been on this story for well over a year now...probably a year and a half.  The 100 Bill is old news and was just the seed money to get it started.  It's going to become the BRIICS gold central banking system for international trade settlement.  They will re-monetize gold for trade in goods by-passing the dollar or they will establish trade via other currencies.  But the goal is to start backing their trades and/or individual currencies with gold. 

The caveat is this, however:  They still need to continue slowly extricating themselves from as much of their U.S. dollar and bond holdings as possible so that they don't start a fucking avalanche and everyone start running and screaming from the theater all at the same time.  That way they can also continue to buy gold for cheap dollars.

But when the day comes and they're all wired together with their own version of SWIFT and everyone is ready to rock, then that's when they will flip the switch on the dollar.  They will all have to dump it at the same time so the transition occurs in one move basically over a weekend.

Don't think the Feds aren't aware of this.  It's been well documented and it's not like they haven't been instrumental in pushing for this to happen as well.  It helps bring down the American economy and our society all at once and that's when the bad guys in charge will make their move to take over the country.

After this happens, Americans are going to wake up on a Monday morning living in an entirely different America.  An entirely different world.  Where the dollar is actually dead and nobody will want it, not even Americans.  Life in this country as we thought we knew it will be long gone to the dustbin of history.

It's still may be a while...I've been guessing sometime just before the end of obama's term in 2016.  That's as good a time as any for these scumbags to make their move. 

Keep stackin' and preparing's going to get wild.

Tue, 07/15/2014 - 16:29 | 4960412 gh0atrider
gh0atrider's picture

"Central banking was such a disaster for the west, let's do it here too!"

Tue, 07/15/2014 - 17:13 | 4960534 remain calm
remain calm's picture

Nobody should get a boner over this, it will take years to get this up and runnimg, but in 10 years this could be viable.

Tue, 07/15/2014 - 17:59 | 4960651 J S Bach
J S Bach's picture

It has officially begun.  The formerly sap-nations of the world - for so long under the usurious thumb of the International banksters - have declared their independence.  Maybe some day, historians in their lands will compare July 15th, 2014 to our July 4th, 1776.

Tue, 07/15/2014 - 18:54 | 4960814 johngaltfla
johngaltfla's picture

Man, you have to love Putin. Not only is he fucking Obama over a barrel, he's doing so while flaunting his military in our face while we send 30+ year old fighter planes in small numbers to defend the bankster slave nations in Eastern Europe!


NATO has Intercepted Russian Aircraft up to 50 Times in Recent Weeks!

Tue, 07/15/2014 - 19:10 | 4960875 MeMadMax
MeMadMax's picture

Does the BRICS treaty include military support in the event the Central Banksters decide they want to act like a bunch of spoiled brats at even the mere thought of competition?


If so, I'm in.



Tue, 07/15/2014 - 19:29 | 4960932 johngaltfla
johngaltfla's picture

Yes. China will stop shipping electronic components to the West and our military will be PARALYZED.

Tue, 07/15/2014 - 19:51 | 4960984 MeMadMax
MeMadMax's picture

Still need to break the "Petro" part of the "Petro-Dollar" however.


Once one or more OPEC countries are in then the world will be all in...


And the sooner the better....

Tue, 07/15/2014 - 19:52 | 4960987 johngaltfla
johngaltfla's picture

Saudi already accepts the Yuan as does Iran. It will take a public repudiation by the BRICS...

Tue, 07/15/2014 - 22:27 | 4961081 Save_America1st
Save_America1st's picture


Hey...also keep an eye on this aspect:  The Amero

I know it kinda fell out of fame a few years back, but don't think it's gone for good.  The world is moving away from the dollar, no doubt about it.  They already have the Euro.  They're starting up the BRICS.  Don't forget that the BRICS isn't just 5 or 6 countries; it's actually nearly 100 other countries that have signed onto their system.  Don't lose sight of that.

Who is left out of those 2 systems?  The U.S., Canada (have you heard of Canada signing on to anything else yet? NO), and Central America.

Who is currently being allowed to invade North America?  Central America.

What's the next step to this open border bullshit and a 3rd world decline of North America?  The Amero currency to "compete" with the Euro and whatever the BRICS are going to do.

Once this all finally goes through, don't be surprised if they try to fuck us over with another fiat currency beyond the dollar by bringing back the "Amero", because they will try to sell it as Canada, U.S. and Mexico/Central America will need to "unite" to compete against the 2 other big regional monetary systems. 

One step closer to a one world government and one world monetary system if the sociopath, anti-human, scum of the Earth win and consolidate the planet into these 3 regions.

This Ameio bullshit is not dead...mark my words, they will bring it back Hegelian Dialectic-style...they will let the the dollar totally crash and then bring this Amero currency up as a way to "bring the North American Union" back to prominence in and "trust", blah, blah, blah, blah in order to compete with the 2 other world monetary systems.

It'll just be another WWF fake wrastlin' deal, coke vs pepsi, mickey dee's vs booger king, etc. etc. etc....and they will continue to try and keep the game playing on and on an on...

All at the expense of the liberty and freedom of all of humanity and especially the American sheeple who are so apathetic and indoctrinated into the Free Shit Army that the traitors of our country who are trying to pull this off against us think that it all just might work. 

just sayin'...

Tue, 07/15/2014 - 22:56 | 4961490 teslaberry
teslaberry's picture

seriously, there are so many dollars in mexico and central and south america-----they would just ALL dollarize . it's easier, it fucks over the peasantry in all countries concerned more effectively ---especially americans using dollars. 


it's just easier and more palatable to roll out. no need for an 'amero' is just dollarization as usual. serious fucking inflation---and subsequent inevitable remintance recycling flow---the drugs come into the u.s and the profits get cycled back out to the mexicolumbians. 


save america 1st, baby, i love you, but you're too narrowly predicting the path of the dialectic. there are a myriad of manners in which the dialectic of transnationalism can be pushed forward. ultimately the common thread is MORE TRADE, MORE RESOURCE EXPLOITATION, MORE LABOR MOBILITY ACROSS BORDERS, MORE REMITANCE OF DOLLARS OUT OF THE U.S. . 


Those are the unspoken , patterns--the threads of transnational integration. but the 'overt' made for television narrative is just a series of various screenplays that help layer those over. 


Tue, 07/15/2014 - 23:22 | 4961549 Four chan
Four chan's picture
i guess once you remove the tangible asset thing from the value of money anyone can be a central bank with unlimited "lol reserves". 

what do you think guys, wanna be a new central bank? we could call it the federal reserve of zero hedge, catchy ring to to it i think.

Wed, 07/16/2014 - 00:40 | 4961699 A Dollar Short
A Dollar Short's picture

You amuse me, Save_America 1st, I'm right on board.


No American politician says it in writing or tracable email but - ONE WORLD ORDER IS WHERE THEIR HEADS ARE!


I say, their heads are up their Fucking ass..


just sayin"

Tue, 07/15/2014 - 20:31 | 4961087 mjcOH1
mjcOH1's picture

"The Rooskies will have a lot of fun sticking it to the Fed."

I see a picture with ministers of 5 countries whose currencies I wouldn't touch with a stolen dick.   You have to admire the audacity.....they see the dollar has no cloths, is still bought hand over fist, and want a piece of that action.   But about a marraige of mongoloids.    If the 'the dollar is fiat being devalued post-haste by a government with no stability' line has some appeal (which it should)....consider a front man before trotting out this group to offer as an alternative of prudance, stability, and reasoned decision making.

Tue, 07/15/2014 - 21:12 | 4961195 kaiserhoff
kaiserhoff's picture

Hail yes.  Every one if these fuckers already has plans to borrow the whole 100 billion, and MOAR!

Tue, 07/15/2014 - 22:10 | 4961366 Save_America1st
Save_America1st's picture

I'd like to know who would down vote my post.  Give me your reason why and your opinion on what's going to happen.

You don't have a fucking clue.



Tue, 07/15/2014 - 23:00 | 4961505's picture

Didn't downvote your post, but the Amero is out because Bitcoin is in.  Do some homework, starting here:

Tue, 07/15/2014 - 23:30 | 4961571 7.62x54r
7.62x54r's picture

If you don't offend enough people here to get at least one downvote, you aren't doing it right.

Wed, 07/16/2014 - 01:50 | 4961787 putaipan
putaipan's picture





Wed, 07/16/2014 - 00:05 | 4961642 teslaberry
teslaberry's picture

i gave you  a long reason. i think youre head is in the right direction, but like gerald celente and others you are thinking to narrow about predictions about the dialectic. 








Tue, 07/15/2014 - 22:15 | 4961388 allgoodmen
allgoodmen's picture

... as you type on your Chinese made computer with Indian software... somebody's fucked them out of the real vslue of their goods & labor & I think the point is they've had enough

Tue, 07/15/2014 - 20:29 | 4961078 Save_America1st
Save_America1st's picture


Tue, 07/15/2014 - 21:10 | 4961191 bitterwolf
bitterwolf's picture

Pretty much. I used to believe in the scenario, make 3 regional power blocs than consolidate into one, now I think the global elite blocs are infighting less and the pace of change is picking up for one BIG move with all the regional agreements already in  place as "transfer mechanisms" to facilitate dramatic change .All they need is some HUGE event/problem  for cover and bamm one world curreny,one global fed with member banks being europe, china,india ,brazil etc. Global governance is another matter entirely and we( 1st/2nd world) will always have the "arc of instability" and transnational crime and terrorist actors

Tue, 07/15/2014 - 21:36 | 4961247 Save_America1st
Save_America1st's picture

They're working on it from so many multiple levels and so may angels against us that for the 99% it's pretty much incomprehensible.

I'm of the mind that at this point...even though those of us know to stack phyzz, stack supplies, and prepare the best we can...there's no stopping this tragectory. 

The majority of the sheeple are totally mind-wiped.  Most of them have their heads up Kim Kardashians big dimply sick fat ass, and they love it more than the reality of life itself. 

So fuck'em...we know what's right.  We know what will change things and what will work.  An original Constitutional society as the original Framers intended. 

But my just ain't gonna happen.  Those who are in charge are sociopaths and

It's not going to stop.  Out best chance at beating them is to let it collapse and then fight those psycho mother fuckers with all we've got until we completely eradicate them from the fucking face of the Earth and make such an example out of them, via the Constitution, Bill of Rights, Magna Carta, and all literature of true freedom and liberty, that those sociopath scumbags will never have a snowballs chance in hell of ever, ever, ever, ever, ever, ever, gaining any fucking power and control again over the sovereign people of this planet.

AND IF THEY TRY.  WE KILL THEM WITH EXTREMEM PREDJUDICE IN ANY WAY POSSIBLE AS TRAITORS AGAINST THE FREEDOM AND SOVEREIGNTY OF THE INDIVIDUAL PEOPLE AND SOCIETIES OF THIS PLANET. the last centurty, these sociopathic, homicdial, psychopatic scumbags are responsible for the all out murder of over 250,000,000 (milllion) innocent, non-combative people on this planet.






Tue, 07/15/2014 - 22:12 | 4961378 Save_America1st
Save_America1st's picture

I'd like to know who would down vote my post.  Give me your reason why and your opinion on what's going to happen.

You don't have a fucking clue.



Wed, 07/16/2014 - 01:31 | 4961766 falconflight
falconflight's picture

I try to remind people that many of the most vocal of posters are CAIR rectum snooters and left hand sniffers, with a mix of racial leftists, and some RonBots...those whom dig him really only because there's some JewHaters on his team.  I couldn't agree more with your points stated in your previous post.  Connecting the dots for these ZH'ers is always to same: Jooossssss and puppets of the Jooosssssss.

Tue, 07/15/2014 - 23:04 | 4961494 palmereldritch
palmereldritch's picture

Just like when the Black Hand delivered the assassination of Franz Ferdinand triggering WWI and the erasure of Europe's regional political structures (read:aristocracies) there will most probably be a similar political spark to detonate the present debt overhang and demolish regional financial structures (read: sovereign national currencies) in the hemispheres. 

This time the controlled implosion will attempt a trifecta: borders, currency and liberty.

Wed, 07/16/2014 - 04:22 | 4961885 NMFP
NMFP's picture

No need to worry about OPEC, America's going to be energy independent soon. All you've got to do is HOPE!

Tue, 07/15/2014 - 20:29 | 4961080 bitterwolf
bitterwolf's picture

not so much.backers of the age old dream labor on another level.

Wed, 07/16/2014 - 09:45 | 4962360 123dobryden
123dobryden's picture

better say, well known CLEPTOCRACIES declared their financial independence from the  biggest ONE.

why you mess something so abstact as a nation into it?

i dont think we should go that far in history in comparing, i have a better date, the date IMF itself started, now it has a competitor

Tue, 07/15/2014 - 18:08 | 4960678 Peanut Butter E...
Peanut Butter Engineer's picture

FED will always and continuously buy the dollars if USD were to be dump globally.

Tue, 07/15/2014 - 19:18 | 4960897 nidaar
nidaar's picture

Won't make much of a difference because no one will give a shit about FED and its confetti by then.

Instead, the question will become how US can get rid of FED and get into the new system, which will become the new standard.

Think of it like FIFA and the US soccer league...

Tue, 07/15/2014 - 22:43 | 4961452 delacroix
delacroix's picture

buy with what? more dollars.

Wed, 07/16/2014 - 10:28 | 4962514 THX 1178
THX 1178's picture

Buy bonds with dollars. Think of the bonds as currency with a non-zero maturity date and non-zero yield. Think of the currency as bonds with a maturity date of zero units time and coupon of zero %. Since money is debt, cash and bonds are essentially the same thing- a matter of degree not kind.

Wed, 07/16/2014 - 00:26 | 4961679 flapdoodle
flapdoodle's picture

The Indians are wise to that trick - they used to have a Prime Minister who would drink his own piss...

Tue, 07/15/2014 - 19:19 | 4960910 Kirk2NCC1701
Kirk2NCC1701's picture

I'm glad that this statistician (JW) caught on to a story that the BRICS have been cooking for years.  What were the odds of bloggers eventually glomming on to this?  IOW... "Success has many fathers, failure but one".

Keep stacking.

Wed, 07/16/2014 - 01:49 | 4961785 FreedomGuy
FreedomGuy's picture

I have also wondered that with the new aggressive and even hostile US infiltration into foreign banks, disclosure of assets and accounts...if this does not further foster an anti-USA, anti-dollar desire on the part of many nations.

In an effort to directly control all bank accounts tied to Americans and trading it indirectly controls foreign banks and their transactions.


Tue, 07/15/2014 - 16:12 | 4960350 Liberal
Liberal's picture

How do I apply for welfare from BRICS?

Tue, 07/15/2014 - 16:12 | 4960352 Anusocracy
Anusocracy's picture

The real question is are they going to go down the Fiat Brick Road or the Yellow BRICS Road.

Tue, 07/15/2014 - 16:52 | 4960492 Liberal
Liberal's picture

That's racist!

Tue, 07/15/2014 - 17:00 | 4960506 logicalman
logicalman's picture

A massive expansion in paper and zeros & ones??

Central Banks are the problem, more of them will not fix a damn thing, IMHO



Tue, 07/15/2014 - 17:18 | 4960549 giggler321
giggler321's picture

With luck, the Z's won't be running these ones - then we've half a chance in at least something different but yes they are the cause of a lot of problems rather than solvers

Tue, 07/15/2014 - 16:05 | 4960327 Killer the Buzzard
Killer the Buzzard's picture

Tyler:  donde esta the deer-caught-in-headlights pic?

Tue, 07/15/2014 - 21:18 | 4961214 MontgomeryScott
MontgomeryScott's picture

The Tylers need to talk to Mr. WB7 about this.

I was thinking along the lines of an old horror story (I think it was written by H.P. Lovecraft, but I may be wrong) that described how a man had trapped his enemy in a room and slowly built a brick wall to shut him inside permanently. BRICKS, BRICS, whatever...

This story is the confirmation of Civilian Intelligence Agencies via the Alternet; regarding an announcement to be made on this date (15 July 2014). I expect that the other date given (22 July 2014) is to be perhaps the Christine LeGard announcement RE: this one.

Most of the prognosticators are incorrect. The collapse will be total, sudden, and quite soon.


'Pray that your flight will not be in the winter or on the Sabbath.' 'Saturn's Day' (Saturday) is named 'Sabado' (Sabbath Day) in Spanish.

Back in '81 or so, it was predicted that Iran would have a nuclear bomb within months (or weeks), and this story has been trotted out again and again by the 'PROGNOSTICATORS'. Those prognosticating fucks are usually wrong, you see. Two to Three YEARS before the BRICS are a 'threat' to USD hedgemony? REALLY? How was that housing crash in 07-08 unable to be 'predicted'? A FEW spoke of it (like lone prophets in the wilderness; Celente, Williams, Schiff,, but the majority said it would NEVER HAPPEN in the financial PROGNOSTICATION MAINSTREAM (Kudlow, Cramer, and the ilk who suck the teat of the Rothschild central banking octopus).


The CENTRAL BANKING OCTOPUS. Have you ever considered that when an octopus feels threatened, it sqirts out INK? Kind of like the ink that comes to the presses that print all the hyperinflationary toilet paper called 'FEDRESNOTES', I suppose. What was the term used regarding the giant squid, again? (Rolling Stone magazine, I think.)

BRICS banking won't work UNLESS their currency is backed by an asset whose value is unchangeable (It has been tried again and again throughout KNOWN HISTORY to back currencies with changeable or non-existent value references, and this has always led to collapse). HMMM... S.A. has mineral deposits, India has bought lots of GOLD, Russia has bought lots of GOLD, China has been loading up on GOLD, and Brazil... well, they have soccer and lots of post-op trannies. I wonder WHAT ELSE they have that might be of value?

Is that 100 Billion in 1913 dollars, or 2014 dollars? Gold was set at about $20 an ounce, and then re-set to $35 an ounce in '33; and then REMOVED from the fixed rate of exchange when President Kissinger announce the OPEC accord agreement in '71. This REALLY pissed France and Gemany off. Since they are so fickle, I expect them BOTH to make moves to not only 'move away' from USD denominated settlements (like they already HAVE), but to drop the USD EN TOTO. As these two go, so goes the Euro.


It's like the SHTF moment now, and TEOTWAWKI is taking shape.

(Obligatory music video link for those who do not understand the acronym 'TEOTWAWKI', or its' usage within the Alternets to describe what is coming [in a humorous, yet tragic way]):

Relax, it's R.E.M. linked by fucking VEVO.

"The dark man is HERE, Larry." (Larry Underwood, a character in Steven King's 700+ page novel named 'The Stand')


Mr. William Banzai Seven could have a FIELD DAY with this one!


Wed, 07/16/2014 - 00:34 | 4961688 falconflight
falconflight's picture

Do you have an opinion about what will trip the switch so to speak to  a sudden collapse

Wed, 07/16/2014 - 05:25 | 4961919 Tall Tom
Tall Tom's picture

Another Banking Collapse/Credt Freeze as September, 2008, too large for any Nation, or ,group of Nations, to bail out will do just fine.


Now what is that Portugal Bank Failue...Banco Espirito Santo...have to do with this? (I have read reports that this is the ECB and EU's Lehman Bros. moment.) What Banks insure the Bonds of that failed Bank? Do they become insolvent also as a result of this? Then what Banks insure the Banks that insured Banco Espirito Santo? Do they become insolvent too?


Yes the Credit Derivative Swaps are a substantial portion of the whole damned Derivative Market with estimated valuation of $700 Trillion to $1,700 Trillion.


The cascading Domino Effect of Bank Failures will be spectacular as the Derivative Markets implode.


With that happenstance Banks will no longer have any trust in other banks. Global Financial transactions cease to a halt. There will be a complete lack of CONFIDENCE that any particular Bank will be around the next day to make good on the overnight loans.


Now this is what happened in 2008 after Lehman Bros. and AIG fell.


Well that switch may have already been tripped, pal.


Now imagine on Monday Morning, July 21, you wake up and your Bank is closed as they are no longer viable. Imagine that on Monday Morning, July 21, that all of your savings have been bailed in. Imagine that on Monday Mornimg, July 21, that your ATM Card or Credit Cards no longer work. Imagine that happening to 325 Million Americans at once.


Imagine that there is a Global Banking Holiday, declared by the IMF, so that the Central Bankers of the World can have some time to sort out all of the imbalances caused by cascading Bank Failures.


Christine Leguard of the IMF has frontrunning knowledge about the solvency of Banks around the World. Is that whu she made a cryptic numerological announcement declaring that on July 20 something large was set to happen? The reset perhaps?


There was an unscheduled meeting of the Board of Governors of the Federal Reserve this past Monday at 11:30  AM. The topics discussed were supposed to be published on the Federal Reserve website after the close of the meeting. I could not find it.


Do you really think that your benevolent Government (snark) is really going to give you an advance warning?


Now if all that I wrote does not come to pass on July 21 then who is to say that something else, like this nightmare scenario, will not happen in August...September...or October? It might happen in 2015 instead of 2014. It might happen in 2016.


But the problem is that not only can it happen, but, that IT WILL HAPPEN as the system is irreparably damaged. Your Government cannot stop it. No World Government can stop it.


Now you can deny that..BUT IT WILL NOT CHANGE THE OUTCOME.


So...Are you prepared for it?



Tue, 07/15/2014 - 15:46 | 4960245 Publicus
Publicus's picture

There is no need for tax, just print money to fund economuc activity.

Tue, 07/15/2014 - 15:59 | 4960304 disabledvet
disabledvet's picture

"And you can do this too!"

Why would anyone else want the reserve currency status thingy anyways?

Tue, 07/15/2014 - 23:33 | 4961578 7.62x54r
7.62x54r's picture

We could start ZeroCoin.

A limited number of cryptocoins generated by upvotes and downvotes on ZeroHedge.

Tue, 07/15/2014 - 18:05 | 4960581 layman_please
layman_please's picture

with this you miss one of the main points why money was invented in the first place. it's a control mechanism which, without taxation, would lose it's main purpose.

Tue, 07/15/2014 - 15:49 | 4960260 smlbizman
smlbizman's picture

how about a standing o for our friends the brics.....

Tue, 07/15/2014 - 23:02 | 4961510 Bernankenstein
Bernankenstein's picture

Sure will, brics need mortar after all.

Tue, 07/15/2014 - 15:07 | 4960070 Skateboarder
Skateboarder's picture

Without physical backing, it too, is a joke. A different joke, however, and that's all the difference we need for now.

Tue, 07/15/2014 - 15:14 | 4960105 Oh regional Indian
Oh regional Indian's picture

Interestign thought triggered there SB, but the two human expressions that have no language barrier are laughter and crying.

We all laugh and cry the same ;-)

He who cries loudest, laughs last, or some such....



Tue, 07/15/2014 - 16:25 | 4960396 putaipan
putaipan's picture

farting. don't forget farting.

Tue, 07/15/2014 - 17:48 | 4960616 Dugald
Dugald's picture


He who laughs last, laughs loudest......

Tue, 07/15/2014 - 18:24 | 4960732 AllWorkedUp
AllWorkedUp's picture

Skatboarder - you are absolutely right. If the BRICS only solution is to replace the fiat USD with fiat of their own it will be a complete failure. If they truly want to garner investment and prestige from around the world they need to back their currencies and their bank with hard assets, whether it is gold, silver, gains or oil, their fiat must be backed by something, otherwise it is an exercise in futility and worse, makes them look like a part of the NWO crowd.

BTW, the USD was screaming higher today. Clearly no fear of the new BRICS bank.

These guys are either stupid or part of the same corrupt system.

Wed, 07/16/2014 - 10:12 | 4962465 old naughty
old naughty's picture

"...either stupid or part of the same corrupt system."

No. Yes.

Agree with SB also.

Tue, 07/15/2014 - 19:25 | 4960916 Kirk2NCC1701
Kirk2NCC1701's picture

Yes it's "funny" that one fiat system is being challenged by another.  But it's no laughing matter when one set of Poker players are being "called" by another.  They are simply speeding up the timeline to "Call".  Eventually bluffing only goes so far and all games end.

The difference between the two sets is that only one of them is able and willing to back their Poker chips with real collateral (resources+labor):  their own.  Margin Call is such a Bitch.

Tue, 07/15/2014 - 21:29 | 4961249 Totentänzerlied
Totentänzerlied's picture

I don't see where it says these countries have severed all ties with the IMF and BIS. China and Russia are pushing hard for the SDR, I don't know why everyone is ignoring this fact, Putin himself is on record about it. It looks like their game is simply to break the US's domination of the IMF, which is the biggest obstacle to non-dollar-dominated SDRs - they're trying to get their own currencies bigger shares in the SDR basket - China has said as much.

Everyone wants to be the star, but theyre all on the same team - only one team is permitted to exist. No competition will be tolerated.

Wed, 07/16/2014 - 00:17 | 4961665 UselessEater
UselessEater's picture

+1000 Totentanzerlied

I am not sure why people did not read this paragraph of the article more carefully because it is not abandonment of the IMF it is a demand on the IMF:

We remain disappointed and seriously concerned with the current non-implementation of the 2010 International Monetary Fund (IMF) reforms, which negatively impacts on the IMF’s legitimacy, credibility and effectiveness. The IMF reform process is based on high-level commitments, which already strengthened the Fund's resources and must also lead to the modernization of its governance structure so as to better reflect the increasing weight of EMDCs in the world economy. The Fund must remain a quota-based institution. We call on the membership of the IMF to find ways to implement the 14th General Review of Quotas without further delay. We reiterate our call on the IMF to develop options to move ahead with its reform process, with a view to ensuring increased voice and representation of EMDCs, in case the 2010 reforms are not entered into force by the end of the year. We also call on the membership of the IMF to reach a final agreement on a new quota formula together with the 15th General Review of Quotas so as not to further jeopardize the postponed deadline of January 2015.

Tue, 07/15/2014 - 19:36 | 4960954 Kirk2NCC1701
Kirk2NCC1701's picture

Yes it is based in their own currency and referenced to USD for baseline/index purposes.

Wait till they change that Reference from USD to Gold (or a basket of PM), and don't even mention the USD... that's when the real SHTF.

p.s. Wait till they talk about a "Basket of PMs"*, rather than just gold.  TPTB and gold-only shills will have a fit.  Especially if the Manipulators get caught with their pants down, with their exclusive focus on gold and silver.  I'm hedging my bets, so I'll be LMAO if this happens.  And "no loss" if it doesn't.  After all, whoever heard of a "Platinum and Palladium confiscation"?

* Gold, Silver, Platinum, Palladium.

Wed, 07/16/2014 - 11:40 | 4962732 egerman
egerman's picture

Ahem..where EXACTLY did you see the word "equivalent" there??? It clearly states: initial capital OF US$ 100bln...

Tue, 07/15/2014 - 15:43 | 4960229 Hannibal
Hannibal's picture

Wrong!..its the equivelent of the USD not $.

Tue, 07/15/2014 - 16:35 | 4960435 tmosley
tmosley's picture

It's based in dollars because they are using treasuries for the initial funding.  

This bank is the sword with which the dollar will be decapitated.

Tue, 07/15/2014 - 19:23 | 4960918 Meat Hammer
Meat Hammer's picture

Annoucing the value of the initial funding in USD was a huge middle finger.

Tue, 07/15/2014 - 19:16 | 4960890 yatikto
yatikto's picture

dollar is simply a tool of influence.   the question is "who" exerts that influence.  until now, US has been the sole source of that influence.

but since dollars are abundant...


fun times.    sometimes I wonder if its stupidity, or some "genius" plan..   you see a man who is wise in his own eyes?  theres is more hope for a fool than for him.

Wed, 07/16/2014 - 10:43 | 4962568 Zerozen
Zerozen's picture

Did you even read the article? Reading comprehension is your friend.

Tue, 07/15/2014 - 15:01 | 4960037 Tjeff1
Tjeff1's picture

No other currency has the deep market "reserve" the size of the USD because no other country runs Trillion dollar deficits year after year.

Tue, 07/15/2014 - 15:44 | 4960234 logicalman
logicalman's picture

A 'reserve' pieces of worthless paper and digits on hard drives!

Now that's what you call a RESERVE!


Wed, 07/16/2014 - 05:36 | 4961922 Tall Tom
Tall Tom's picture

Well with BitCON you get rid of that worthless paper. Now you just have worthless digits on hard drives. That is an "improvement".


(At least with the paper I can wipe my ass....before spending it.)

Tue, 07/15/2014 - 15:02 | 4960041 theXman
theXman's picture

As I related below, RMB is subject to more money printing and depreciation than USD. There is no real control on the printing press other than poliburo. Therefore I don't think RMB is a real threat to USD. But if BRICS comes up with a new international currency, similar to SDR, exchangeable to USD and any national currency, that would be a real threat.

Tue, 07/15/2014 - 15:13 | 4960096 Winston Churchill
Winston Churchill's picture

A gold backed ' bric ' thru Uncle Scams window.

No one country as GRC holder, the 'bric' backed by metal.

It always was the only solution.One step closer today.

Tue, 07/15/2014 - 19:24 | 4960919 DaveyJones
DaveyJones's picture

and bankers hate the idea

so it must be good

Tue, 07/15/2014 - 16:44 | 4960471 TheReplacement
TheReplacement's picture

Doesn't it really matter what the major oil producers decide?  If they decide to accept other currencies besides dollars then the dollar loses, no?  I think the BRICs is a step toward giving those oil producers a choice.  US foreign policy actions certainly must be making any other choice besides dollars look better and better.

Tue, 07/15/2014 - 15:02 | 4960048 cossack55
cossack55's picture

"Paging Kudlow.  Larry Fuckin' King Dollar Kudlow.  Where are you?"

Tue, 07/15/2014 - 15:25 | 4960153 frankTHE COIN
frankTHE COIN's picture

This is what Steve Liesman was telling Santelli yesterday. There is no Inflation and No Destruction of the Dollar. /sarc

Tue, 07/15/2014 - 15:39 | 4960216 yogibear
yogibear's picture

No wonder CNBC's viewership is in the toilet. Liesman reminds me of George Castanza.

The management could save a lot of money if they outsourced the show to India. The only person they should keep is Santelli.

Tue, 07/15/2014 - 16:15 | 4960366 Dr. Richard Head
Dr. Richard Head's picture

Liesman has the same argument formation that my 5 year old daughter has - "Nuh-uhhhhhhh!!!!  YOU ARE!!!!!!!"

Tue, 07/15/2014 - 15:03 | 4960050 ATM
ATM's picture

Our government is doing it on purpose. They are trying to make the USA an outcast/rogue nation that no one trusts or will deal with. Working well too. Spy on them, sanction them, drone them..... Pretty soon nobody will like the old USA any more and will simply say fuck you and your dollar too!

Our 'remake the country' fuckers are well on their way. 

Tue, 07/15/2014 - 15:11 | 4960086 john39
john39's picture

americans don't control their government...  and I agree with you, someone is trying very hard, and suceeding at, destroying the United States, on almost every front.   it shouldn't take too many guesses at this point, the same cast of characters shows up time and time again...

Tue, 07/15/2014 - 15:37 | 4960204 Anusocracy
Anusocracy's picture

Stupidity undermines itself.

Evil undermines itself.

In and out of government. Enough said.

Tue, 07/15/2014 - 21:20 | 4961213 willwork4food
willwork4food's picture

Someone once said that America could never be invaded because there would be a gun behind every blade of grass even if you were successful in landing on it. DC and the tribe clubs know this, so the only logical way is to bring economic armaggedon, install marshal law, further feed disinfo and blame games into the news and let us kill each other off.    Right off the pages.

Read: American Apocolypse.

Tue, 07/15/2014 - 16:02 | 4960314 Monty Burns
Monty Burns's picture

Our 'remake the country' fuckers are well on their way. 

= Frankfurt School + Cloward Piven disciples.  And don't think they're remaking it in the interests of ordinary Americans.

Tue, 07/15/2014 - 18:09 | 4960685 Save_America1st
Save_America1st's picture

Exactly, Monty Burns. 

Welcome to Fight Club

Tue, 07/15/2014 - 16:48 | 4960478 TheReplacement
TheReplacement's picture

Let us not call it remake.  Remaking the country implies there will be a final product.  I think most of us here would agree that remaking the country could be a good thing.

These people seem bent on destroying the country.  Destroying is not like remaking.

Wed, 07/16/2014 - 00:41 | 4961702 gatorboat
gatorboat's picture

"Our government is doing it on purpose."

"We'll just kill the dollar."

Tue, 07/15/2014 - 15:24 | 4960149 AnAnonymous
AnAnonymous's picture

Firms and banks are starting to plan to replace the US dollar... What a way to put it.

All these 'american' thinkers cant state the end of the USD as a reserve currency will come as resources around the world are depleted.

They cant because they are 'american' and therefore must keep true to the tale that 'americans' can overcome the environment.

Tue, 07/15/2014 - 16:38 | 4960449 Mi Naem
Mi Naem's picture

AnalNosemouse -

Your efforts to troll might be more effective if you weren't so predicatable. 

You've probably been jackin' off to the same centerfold since 1986 - and he isn't even cute, is he?

Tue, 07/15/2014 - 22:02 | 4961335 MontgomeryScott
MontgomeryScott's picture

Damn, Skippy!

Some people are still caught in their personal paradigm (like rats in the proverbial maze), you know.

WELL, some people are also drawing a paycheck from their government's 'I.T.' departments to post bullshit on the blogs that discuss events such as this in a fashion that belittles the importance of these events (kind of like trying to put a ground-up Prozac pill in the water that will try to calm the 'patient' down so that he or she will not be too much of a bother when Nurse Ratchet comes in to take you for a full frontal lobotomy).

Maybe 'AnAn' isn't really 'queer'. Consider the possibility that the Farah Fawsett poster he bought in the 1970's might be quite stained.

Oh, hell! He's probably too young to know who this is. "The Six Million Dollar Man", Lee Majors, married her, and she hyphenated her name to include him. PERHAPS he stains the posters (or posteriors)of them both as he plays with his little winkie (you never know).

Ferrah Leni "Farrah" Fawcett was an American actress and artist. A four-time Emmy Award nominee and six-time Golden Globe Award nominee, Fawcett rose to international fame when she posed for her iconic red swimsuit poster …


Little Peanut (AKA 'AnAn') probably won't understand, as he sits in the underground bunker in Haifa (or wherever) why his posting is so humorous to this forum.

Wed, 07/16/2014 - 03:18 | 4961837 AnAnonymous
AnAnonymous's picture

The 'american' nature is eternal. As a consequence, its depiction is bound to remain the same.

'Americans' have been the same since 1776,July,4th.

The day 'americans' can address their nature, the day they are unpredictible. But this day wont happen as they cant face reality and always prefer to sidetrack.

The 'american' nature is eternal.

Tue, 07/15/2014 - 15:39 | 4960217 kchrisc
kchrisc's picture

"Hold it! Next country that makes a move, the Petro$ gets it"

Tue, 07/15/2014 - 15:43 | 4960226 realWhiteNight123129
realWhiteNight123129's picture

It is an interesting statement. The dollar as parking place has no value. Commercial bank currency is only as good as teh credit backing it (the proof is Cyprus). I am taking about M1 and M2 and M3 which are currency not money.  M0 (central bank notes) or money (in hte past it was the Gold coin) has a particularity: M0 is only as good as the assets backing them. In hte US and EU, those assets on the central bank balance sheet are crap. The only asset which is good is good bills and receivables. That is the world trade. The only good asset backing the dollar is the world trade. You remove it, and yes you have a lot of monied capital parked in USD, but the USD loses the only good credit asset backing it (the good bills of the world trade). So even if people wanted to park moneied capital, moving away from teh dollar for trade is death sentence for the USD. 

Wed, 07/16/2014 - 03:20 | 4961838 AnAnonymous
AnAnonymous's picture

The USD is backed by the resources it buys.

And the BRICS go for that.

Wed, 07/16/2014 - 08:34 | 4960292 realWhiteNight123129
realWhiteNight123129's picture

Martin Armstrong is refering to two different concepts well explained by Thomas Tooke in 1830-1840s...  The ~parking of the money~ is called monied capital. The USD used for trade is called medium of circulation. Thomas Tooke and Fullarton as well, explain that irredeemable government paper (fiat money) acquires its value in use. In other words, some transaction of real economy of good and services against the paper needs to take place in order for the USD to have any value. The monied capital element (parking money) does not give any value to the paper at all. You can park Silver all you want post 1935 (China was the last country to leave the Silver standard), if you stop using Silver in transaction you demonetize the silver. Silver from time to time is remonetized when the paper currencies crap out... and has a lot of applications. (I am very long silver guys).  But what we are witnessing is the same process: Demonetization of the dollar....


The classical writers Tooke, Fullarton and others call fiat money with two names: 1. irredeemable government paper used as a medium of exchange  2. forced currency.... The second name is because in redeemable currency, you can always convert your currency for Gold, melt the Gold, use for decoration or jewelry and that way the market regulates the quantity of currency in the system. If you can not force people to use the fiat money it has no value, that is the dilemma facing the US. Now the idea of using sanctions and preventing certain countries from using the Dollar is mind-boggling. It reflects a total ignorance of currency principles from Washington. Somehow they think that if the USD is not used in trade it will "magically" retain some value.... Those guys arrogant ignorants.

Tue, 07/15/2014 - 15:59 | 4960300 Urban Redneck
Urban Redneck's picture

Martin should know better or write clearer. Capital flows dwarf the available money supply even of the US... so the capital has to be parked in debt, equity or tangible assets. You can't park trillions of capital in USD. The BRICS are going to have fun issuing issuing debt and inflating asset prices over the coming years. But he's right in the sense that would take several years (4???) to ramp up the supply of "parking spaces".

Tue, 07/15/2014 - 19:07 | 4960858 Duffy Duck
Duffy Duck's picture

What happens to the RS of the FRN when people stop buying us treasuries, though?  As seems inevitable...

Wed, 07/16/2014 - 06:11 | 4961941 realWhiteNight123129
realWhiteNight123129's picture

If the emerging countries stop buying it, the Gov will have to create a MyIRA program or force people within the US to hold Treasuries. THe Fed would have to continue to buy TRYs in order to prevent interest rates to make the cost of borrowing prohibitive. Eventually this policy will prove a failure and all sorts of price controls interest rates controls and capital controls will ensue. The US economy will be destroyed by those policies. 

Tue, 07/15/2014 - 22:21 | 4961406 Hard Assets
Hard Assets's picture

Martin Armstrong is a dork !

This is HUGE news (although we knew it was coming albeit not this quick).

Where he is wrong is FOA's theory of "Big Float Comes Home". There are now too many dollars floating around and they will "come home", essentially inflation (hyper?) is on the way. USDX will begin to fall, perhaps alarmingly.

Number of unwanted/not needed dollars will be directly, inverse to the DX.

July 15, 2014.....the day the dollar died. Panic, shock and death is now a "when", "if" no longer applys.

Have a golden, fucking day !

HA.....formerly Canuck.

Tue, 07/15/2014 - 22:55 | 4961487 HardAssets
HardAssets's picture

Some people confuse real weath (the capacity to support X number of human lives for X number of forward days) for the appearance of 'wealth'. Little pieces of paper or representations of digits in a computer memory - - - aren't real wealth.

When the people of the world understand that reality . . . it'll be all over for the fiat US dollar. Con games require that the suckers have confidence in the illusion.

Wed, 07/16/2014 - 02:53 | 4961820 GardenWeasel
GardenWeasel's picture

uh, why can't you park money in other currencies? if you have the currency to make the transaction, why do you have to convert it to put it in the bank? that is only if you put it in a U.S. bank, which is precisely the point. I think you misunderstand what the dollar is. It is just another medium of exchange, and just because it has been used as a convenience does not make it a necessity.  Any bank can store any currency they want to since it is all electronic anyway,  they just have to - pardon the expression - do the paperwork. That is just what the BRICS are doing. I have money in Hong Kong, it is not in dollars. There is plenty of money "parked" in Hong Kong, Singapore and other Asian banks that is not in dollars.  If you are referring to the practice of holding U.S. debt as a place to "park" money it would seem only the Fed is interested in that any more.

Wed, 07/16/2014 - 06:58 | 4961973 where_is the_nuke
where_is the_nuke's picture

Does Paul Krugman happen to be your daddy?

Tue, 07/15/2014 - 14:57 | 4960008 Stoploss
Stoploss's picture

They're going to back it with gold.

Now we know why the massive buying spree's.

That leaves us the bag holders.

Another brilliant move by the FED.

Tue, 07/15/2014 - 14:58 | 4960019 Divided States ...
Divided States of America's picture

Spot on Stoploss...I was going to say that....but yeah 100 bn may not be enough for now but its a good start. At least its backed by real assets and not worthless paper printed out of thin air.

Tue, 07/15/2014 - 15:04 | 4960053 Manthong
Manthong's picture

A good chunk of the Russia and China contributions just might be in bullion.

Tue, 07/15/2014 - 16:37 | 4960441 viahj
viahj's picture

gold, nat gas, oil, indutrial assets, timber...the new currency (when they get around to launching it) will be a commdity basket.

Tue, 07/15/2014 - 19:35 | 4960951 Meat Hammer
Meat Hammer's picture

But our money has pictures of great Presidents like Honest Abe Lincoln on it!!!


Tue, 07/15/2014 - 16:53 | 4960493 TheReplacement
TheReplacement's picture

Just wait until gold gets unhooked from paper gold and the inflation of the USD is applied to the cost of gold.  That $100B (if backed by gold) could turn out to be a lot more than $100B. 

Tue, 07/15/2014 - 17:07 | 4960518 Flagit
Flagit's picture

There was $5 billion in capital abailable (typo, but i like it. new word, maybe?) for a company with no product, no plan, and no people, save one.

If you build it, they will come.

Tue, 07/15/2014 - 15:25 | 4960155 ForWhomTheTollBuilds
ForWhomTheTollBuilds's picture

Probably why gold is getting hammered again.  Whether you believe that the US govt wants to give a market signal that all is well with the USD or whether the BRICS nations are gaming the comex to scoop up phys on the cheap, the evidence fits (I actually really look forward to reading about which one it was someday).


Isn't it weird how the most collosally damaging "conspiracies" dangle out in front of us in plain sight while the media either ignores it or cautions that you need a lot of expertise to analyze events and the bloggers just don't have it?

Tue, 07/15/2014 - 19:27 | 4960930 DaveyJones
DaveyJones's picture

the only difference being, that one strategist is being smart, and the other, not so much

Tue, 07/15/2014 - 15:42 | 4960223 Greenskeeper_Carl
Greenskeeper_Carl's picture

They are not going to back it with gold. Some of these countries might have large gold reserves, but no country or central banker wants and in elastic currency that can't be printed. India just sold a bunch of their gold to its citizens, and is 'buying gold' that will allegedly actually exist and sit in London. China doesn't want a currency they can't print either, they are a mess. Brazil is a mess too. Not defending king dollar by any means, this is just a way for them to bypass the dollar and remove a way for the US to bully them around by imposing bullshit rules on how they conduct business. Will this hurt the dollar? Yes. Is this going to have any kind of gold backing? No, it is not. It's the inevitable consequence of the US abusing its status of being able to print the worlds reserve currency and use it as a bully pulpit. This will just be another paper fiat currency used to avoid dealing with all the bullshit rules we have imposed on everyone who uses Te SWIFT system and the dollar

Wed, 07/16/2014 - 01:02 | 4961726 gatorboat
gatorboat's picture

"They are not going to back it with gold. Some of these countries might have large gold reserves, but no country or central banker wants and in elastic currency that can't be printed."

Inelastic backed by gold is the only thing that can knock the US dollar out of reserve status.  If BRICS don't do it, then all their anti-dollar efforts are wasted, which is why I think they will do it.

I can't think of any other reason Russia and China have accumulated 40,000 tons of gold between them.


Wed, 07/16/2014 - 05:24 | 4961917 HardAssets
HardAssets's picture

The world has been awash in mountains of fiat currency. Why is this - when many nations said they would not resort to such printing, but later did so anyway ?  Because the current financial system is based on the US dollar, and its being printed like crazy. The US dollar is the reserve currency. Foreign nations had to print more of their own currencies in order to remain competitive in world trade. There was also pressure put on these other nations to all inflate their currencies simultaneously. The only currency (and the only real money) that could not just be printed is gold; so they attack it and silver in the markets viciously.

The world doesn't need unbacked fiat currencies. The opposite could bring about a global revival of prosperity. And many would dance & sing when the wicked witch is dead.

Tue, 07/15/2014 - 21:59 | 4961339 MarkD
MarkD's picture

Why not back the USD with old iPhones? They got value.

Tue, 07/15/2014 - 23:33 | 4961577 Freddie
Freddie's picture

Yes.  Dr. Jim WIllie has been saying that his sources know that Russia has a huge huge stockpile of gold.  Jim said one of his sources actually saw it?!?!

We also know China has buying every ounce they can get their hands on.

Tue, 07/15/2014 - 15:12 | 4960087 CrashisOptimistic
CrashisOptimistic's picture

More than anything else, this will destroy the US weapon of sanctions. 


Iran will use this facility and the various countries that want to buy Iranian oil will be able to without the transaction being halted at a bank.



Tue, 07/15/2014 - 16:21 | 4960387 El Vaquero
El Vaquero's picture

Not necessarily over the issue of a BRIC version of the IMF, but it is fun trying to explain what this means to people.  The idea that oil will be sold in something other than USDs means a reduced global demand for USDs, and we're standing pretty close to the edge of a financial cliff.  It's not that countries like Russia and China are super strong, it is more that we are getting a lot weaker.  It is easier to push somebody over a cliff when they are looking over the edge than it is to drag them kicking and screaming to the edge to throw them over. 

Wed, 07/16/2014 - 06:25 | 4961950 Tall Tom
Tall Tom's picture

It is much easier to throw them off by baiting them to throw themselves off.  By dangling something irresistable over the edge of that cliff they run to grab that and then the experience their Wile E Coyote moment.


Maybe a Roadrunner cast in Gold will suffice?


Moral...You cannot trust Governments...or Central Banks...ANY OF THEM.

Tue, 07/15/2014 - 19:29 | 4960931 DaveyJones
DaveyJones's picture

was havign similar thoughts

their "war for oil" is so much more effective

Tue, 07/15/2014 - 17:50 | 4960623 midtowng
midtowng's picture

They are still one step short: depegging from the dollar. Until that is done, this is still just a step along the way.

Tue, 07/15/2014 - 21:40 | 4961276 Pumpkin
Pumpkin's picture

Is there an assassin shortage or something?

Tue, 07/15/2014 - 14:48 | 4959962 Sudden Debt
Sudden Debt's picture

2 to 3 years is really close. I'm already planning my christmass trips.
Prepare now for the max. And I don't mean bulking up on spam and crap, but open up a account at the chinese bank, more silver or gold, shit that has value.
You can never have enough.

Tue, 07/15/2014 - 14:57 | 4960006 Theosebes Goodfellow
Theosebes Goodfellow's picture

Let me suggest owning a few rototillers to rent out. The backyard gardening craze is just around the corner. It'll be very popular with the hungry.

Tue, 07/15/2014 - 15:03 | 4960049 Mrs. Cog
Mrs. Cog's picture

Good observation Goodfellow.

And might I suggest extra hand tools for the garden in case the hungry can't afford gas for the tillers.

Tue, 07/15/2014 - 15:13 | 4960095 CrashisOptimistic
CrashisOptimistic's picture

Rototillers don't work well without oil/gasoline.

Tue, 07/15/2014 - 15:23 | 4960145 Mrs. Cog
Mrs. Cog's picture

Careening into unknown circumstances, I would hate to have my garden aka future food strictly depend upon access to gasoline. Don't get me wrong... I love both our tillers. Especially when Cog is operating them for me. :-)

Tue, 07/15/2014 - 15:52 | 4960271 Pinktip
Pinktip's picture

Only way to plant a garden......

Tue, 07/15/2014 - 16:07 | 4960335 css1971
css1971's picture

I have an electric.

Tue, 07/15/2014 - 15:06 | 4960063 El Vaquero
El Vaquero's picture

I'm already seeing a lot more gardens.  I'm also breeding my own cultivars, so when that craze hits, I'll be able to make a killing on seed for cultivars that kick ass here. 

Tue, 07/15/2014 - 15:43 | 4960232 kchrisc
kchrisc's picture

"Sir, the SWAT team and I raided your home, shot your dog, tazed your son, and fondled your daughter because you have an illegal garden that must be removed and the produce thrown away for your protection. It's the law."

"Oh, and we're confiscating your home and assets as well."

Tue, 07/15/2014 - 15:50 | 4960265 DaddyO
DaddyO's picture

Molon Labe, bitchez!


Tue, 07/15/2014 - 17:07 | 4960517 Malachi Constant
Malachi Constant's picture

Not very wise. Two determined armed persons, who spent modest time training as a team, will take away everything from your house.

The only guaranteed way to fool the robbers is to have nothing worth taking.

Tue, 07/15/2014 - 17:04 | 4960515 El Vaquero
El Vaquero's picture

Yeah, on that second video, the act was changed to exclude small farmers and home gardeners.  I wouldn't comply with it anyway. 

Tue, 07/15/2014 - 16:05 | 4960329 css1971
css1971's picture

mmm. I agree about gardening, but rototillers are a really expensive/hard work way of going about it.

Tue, 07/15/2014 - 15:20 | 4960136 seek
seek's picture

I agree on silver/gold, but...

I suspect (for a while at least) when this goes down, you won't be able to access your Chinese account, and the US will claim full ownership of it while the Chinese refuse to honor that demand, and that (ironic given the current circumstances) the ability to cross the border will be severely restricted.

My expectation given all the posturing taking place by POTUS and large swaths of TPTB crew ( (D) and (R) alike) is that the US will go full Soviet mode briefly before crumbling. I wouldn't be shocked at all if foreign banks used that as an excuse to close accounts and take the funds.

Tue, 07/15/2014 - 14:51 | 4959973 Pure Evil
Pure Evil's picture

Yep, they get to break away and we're stuck with a turd in the toilet bowl called the White House.

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