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Have Central Banks Entered An Undeclared War?
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
The monetary tectonic plates are shifting, and predicting the next global financial earthquake is relatively easy.
I recently suggested that the devaluation of the yen was Japan's Monetary Pearl Harbor: a direct attack on the currencies of its major trading partners: the euro (European Union), the won (South Korea), the Australian dollar (AUD) and the U.S. dollar (USD), which affects both the U.S. and China since China's currency, the renminbi, is pegged to the USD.
Though there have been no overt (that is to say, public) counter-attacks, this may not reflect monetary peace so much as an undeclared war. Correspondent Mark G. observed that the current geopolitical backdrop is considerably more unsettled than the relatively benign global chessboard in 2008:
"The Eurozone and the Pacific Rim now have a pair of regional wars being fought out primarily by financial and monetary means. We can infer that the major central banks won't be anywhere near as cooperative during a crisis as they were in 2008."
While the American-European financial sanctions against Russia and Russia's counter-moves are being waged in public, the public response of the Korean and Chinese central banks to Japan's massive devaluation has been limited to grumbling.
But it is unlikely that other central banks are limiting their response to Japan's aggressive devaluation to words.
Let's start by noting that central banks play two games: one is pure public relations: marionettes on strings beat deflation with sticks and declare they'll save financial parasites with "whatever it takes" monetary policies.
Meanwhile, their actions may be mere shadows of the bold policies being trumpeted, or they may be extremes nobody dares make public, for example the Federal Reserve's $16 trillion bailout of literally the entire Western banking sector in the last Global Financial Meltdown.
(The Levy Institute came up with $29 trillion after poring over all the data):
The U.S. Fed has remained mute, but the yen devaluation has destabilized the global monetary order, whether the Fed acknowledges it publicly or not.
Unsurprisingly, central bank public statements don't mention that competing devaluations share certain characteristics with circular firing squads. Beggar thy neighbor policies destabilize currency flows, and from there, imports and exports, and from there, domestic regimes.
Is there a beneficiary of devaluations and shadow currency wars? It's not too difficult to imagine gold will eventually be revalued to reflect the decline in purchasing power of devalued currencies. It's also not too difficult to anticipate capital flows into whatever currency isn't being actively devalued--for example, the U.S. dollar.
One peculiar consequence of choosing not to devalue one's currency is the resulting inflows of capital fleeing devaluing currencies act as a form of quantitative easing: some of that capital flows into Treasury bonds, effectively replacing the Federal Reserve's QE bond purchases.
The monetary tectonic plates are shifting, and predicting the next global financial earthquake is relatively easy. Predicting the timing and the winners--now that's tricky.
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Moar, please.
long body bags
NO
They didn't just enter an undeclared war.
It's been going on for years.
...undeclared cartel.
Fixed.
All central banks are following a coordinated script. It's war on the 95% of us they all declared, not against each other.
Other signs:
Central Banks Race to the bottom
Interchangeable presidents: http://www.washingtontimes.com/news/2014/nov/21/ben-carson-obama-is-very...
In school when the retard started acting up we just let them go wild unless he she started to hurt someone
tectonic plates my ass. Neal Adams expanding earth http://goo.gl/5wPpD0
"The monetary tectonic plates are shifting, and predicting the next global financial earthquake is relatively easy."
Ok then Chuck, what is it? What's going to the stop the merry go round?
It's really more like an undeclared resource war between planet Earth and us. The tribe is trying to figure out how to keep their playground intact for as long as possible while also making sure they are the ones that have the best chance of making it through the bottleneck/pinch/squeeze that can be expected as the status quo changes.
Now that is their real dual mandate. Make it through the pinching sphincter while playing as much as possible both before and after.
Knukles,
Spot on.
DavidC
Get yerself into some anti-fragile Bitcoins today!!
I did...
says nothing and heard it all before
The worst part is that A FALLING CURRENCY IS NOT GOOD FOR EXPORTS !
A strong currency is in fact, good for exports.
As we can see some real life examples here : http://freegoldobserver.blogspot.ca/
I think you prove that a falling currency is not good for exports in the Abstract. The manufacturing of them. The imported raw materials that they are made from.
But in the real world, a country's exports are judged by the totality of their sales every quarter.
No differently than the way a large corporation lives from one quarterly report to the next. Where it is permitted to burn down your headquarters in the winter to save money to save money on heating it.
Yes, for quite some time now. Be happy, FMJ .556/.223 rounds are on sale.
I wish some 300 BLK would go on sale.
Here ya go dude:
http://ammoseek.com/ammo/300aac-blackout
Better yet:
http://gunbot.net/ammo/rifle/300blackout/
www.gunbot.net
you got a point there, but I think it should be here 5.56
Strongly recommend everyone listens to this week's Andy Gause interview on one radio network.
Andy explained that Fed is STILL expanding its balance sheet, (now leveraged 78-1)but that the boyz have very successfully smashed the price of commodities and that the next big move is already underway. The $2.6 trillion currently held on reserve at the Fed by the main WS banks will now be plundered in a huge wave of mergers and acquisitions so that the means of production, gold silver copper companies, reits, will be purchased at a steal of a price. What follows this is a wave of inflation across the board.
$160Bn withdrawn this month alone.
Nice work....
Global monopoly. It's very easy to bankrupt everyone else when you don't have to work for a living and can print reciepts for real goods and services. Unfortunately, the demographics of the planet are changing. look at the reverse REPOs, The fed is most definitely trying to suck out "liquidity". They know hyperinflation is not far off now and like you said, they are more concerned about maintaining power and control over productive assets.
same as it ever was.
Quite smart though. The 2.6trillion came from printed money by the Federal Reserve, in return for debt instruments originally issued by the Treasury. This e-money was then sterlised by lodging it on reserve at The Fed by the same banks who control the Fed.
How many Americans are aware of what is going on under their noses?
Please...
There is a reason why congress can't audit the Fed.
Cheers, good quotes, very good quotes.
In the same show Andy explained who he thought was responsible for the asassination of JFK. The Federal Reserve, though he did correct himself and generalised "dollar inc". He went on to explain that the CIA was originally headquartered in Manhattan and that the organisation was set up by Wall Street Banks to look after dollar interests around the world.
Looks as though America died back in '63.
And in the streets the children screamed,
The lovers cried and the poets dreamed.
And not a word was spoken;
The church bells all were broken.
“The three men I admire most: catching the “last train for the coast” John F. Kennedy, Rev. Martin Luther King, Jr., and Robert F. Kennedy?
Smashing the price of commodities and buying them up with inflated USD was pretty slick.
It's all part of the plan.
"...the main WS banks will now be plundered in a huge wave of mergers and acquisitions so that the means of production, gold silver copper companies, reits, will be purchased at a steal of a price..."
Mergers and acquisitions? Wouldn’t it be great for the central bank to put a key man in the U.S. Treasury to plunder in the name of the people?
Voila! Up steps Obama’s nominee for undersecretary of Treasury for domestic finance, Antonio F. Weiss.
Weiss, shouldering an anticipated compensation in 2014 between $5 million and $25 million doing investment banking for Lazard where he headed many global mergers and acquisitions, is well placed for the international bankers’ final coup d’etat/US.
Here, according to Wikipedia, are his “Notable Deals”:
“His deals include Reynolds American's acquisition of Lorillard (pending),[5] the merger of Rockwood and Albemarle (pending),[6] the acquisition by Berkshire Hathaway and 3G Capital of Heinz,[7] the sale of D.E Master Blenders to JAB and pending merger with Mondelez coffee,[8] Anheuser-Busch's acquisition of Grupo Modelo,[9] Google's acquisition of Motorola Mobility,[10] 3G Capital's acquisition of Burger King,[11] Kraft's acquisition of Cadbury,[12] the KKR and KPE merger,[13] InBev's acquisition of Anheuser-Busch,[14][15] Nestle's acquisition of Gerber and Novartis Medical Nutrition.[16]"
http://en.wikipedia.org/wiki/Antonio_Weiss
Weiss's final merger will be the United States and the New World Order, acquisition by the international bankers.
i like it
make w whole battle field
yes.
"I recently suggested that the devaluation of the yen was Japan's Monetary Pearl Harbor"...
And the second casus belli on that Country 66 years later that made it all possible with no justice in sight !
In the international playground there are no friends, only allies, enemies and people to manipulate. Everybody is out for their own self-interest.
Not true. I can't find any reasonable rates of interest in anywhere.
Germany is going to start CHARGING interest on SAVINGS and CHECKING, watch as your bank balance dwindles without you doing a tihng.
imo the low rates in germany a bet on euro breakup
(what you might lose in interest income will be more than offset by currency appreciation when your euros become marks)
Hard to understand that one. People will respond by keeping the minimun in the bank, paying bills in cash etc. Unless you're trying to cause bank deposits to go down and deflation I don't understand it. I guess I'm not as smart as I used to think I was.
There are only interests in geopolitics.
Allies, friends, and peoples will be gladly sacrificed to further those interests.
eg If the US needs to nuke Europe to retain hegemony, the PTB would not give it a second thought,
after setting someone else up as the scapegoat..
Obozo's motto is fuck our allies and bend over for our enemies......
"..........................yada..........Predicting the timing and the winners--now that's tricky".
Those are the only two things that matter in everything.
And 'timing' doesn't really exist at all, but as a poor, obfuscating symbol of "events".
To rephrase:
"Predicting the events and the winners--now that's tricky".
So, really, the rest of the garbage above it, is just a buncha meandering garbage.
True. But he did make sure no one will steal the extremely clever picture of the fractured piggy bank. And thank God he didn't use that 'cargo clutch or cargo cult' phrase he thought was gonna sweep the nation...
What a bunch of monkeys pressing CTRL-P hoping for their hoard of stolen goods remains intact. FUCK THEM!!!!!!!!
I think the Central Banks are all working together...one year its the USA..next year its the Japanese...next year the EU boys....they take their turns at the printer.....its all they have now...
Ya think?
http://humansarefree.com/2013/11/complete-list-of-banks-ownedcontrolled....
The USA did it and for some reason got "this isn't the hyperinflation you are looking for." We're not winding down QE because it worked however....
Correct, Henny...it's like Jeff Nielson says - all central (and by extension all other) banks are tentacles of the One Bank.
I usually like CHS, but here he's totally missing the boat.
Listen Zero's.
Sometimes I find it strange that the Americans, almost all of them, always view just about everything through the "WAR" lens. Their bankers have them trained well.
Well, it's getting late here in Bangalore. I'm going to have a "WAR" on sleep tonight, I know it's not a very good adversary, it's aging equipment(mattress and pillow) are no match for me, but still I must. I must fight the "WAR" on sleep!
May it be your last
Don't forget to close the hatch on your " spider-hole"...
There are no winners dude. Some starving sick people may crawl out of the ground in 20 years but maybe they won't. To me it seems like I've been waiting all my life for this time. Bring it on M'Fers.
Glad FOMC no longer worried about King Dollar (maybe ... just maybe ... not a damn thing they can do about it)
DXY kicking azz comfortably above 88
CENTRAL BANKS are all Working together ... it is the same org !!!
Its us against the fucken BANKERS... your on one side or the other.... its black or white
if you believe the FAKE story that the banks put out, your not seeing the world for what it is...
Central BANKS = greatest FRAUD in Human history
is that it , have they blown their wad?
This is all a show. If you believe for one second you'll beat the system and save what's yours by purchasing gold, etc., then you're naive. The uber-rich sociopaths will NEVER relinquish control of the fiat system they built from the ground up. The rich make the rules and control governments like puppets... most of their holdings are in the stock market and cash. They will potect their interests/assets at ALL COSTS... either they wil die trying or you will trying to abstain from their system or trying to change it... they have and will maintain. This is not about money, gold, etc., it's about social control at it's root. Fiat, gold, etc., are simply tools of the rich who control the rest of us out here. You've seen the trendline... are the rich obtaining more or less control of society through time... ???... more laws, more militarization of police forces, more internet/camera surveilance, more war mongering, more corruption of government officials coupled with immunity from prosecution, more QE to bail out gambling bankers, etc.
If you're smart, you'll watch what the rich do and follow suit rather than bet on them losing control and going broke - remember they can make and change the rules to the game at will and you, well you are simply a powerless pawn on a chessboard.
Wow...and I thought goldbugs were doomers.
The problem with the elites maintaining control over the house of cards their creation has become is that the more complex a system becomes, the more variables there are to monitor and tweak. Eventually they can't simultaneously manipulate all the variables and the system reboots.
Good luck all.
Uh if the system reboots, then I'll be long food, shelter, warmth and lead.
If you're paying attention you can see the rich are trying to level out the standard of living world-wide before implementing a world-wide system of governence. Sure the system is complex and they are making it more and more complex on purpose so when the SHTF, only the people that understand the "complex system" can "straighten it out"... those in control have always used "complex systems" to confuse/control their less bright sheeple.
Reboot? If you don't think the rich already have a "reboot plan" in place then you're naive. They have one alright and it involves the use of the military and militarized police coupled with false flag ops to justify their actions to a population of sheepe they utilize fear to control and herd around.
Here, let me simplify it for you. You want control of your assets and in general control of your life and figure bullion is your best bet to get it. Your "pet owner(s)" or those who control the world want the inverse... complete control over pets such as yourself. Just watch as they smackdown PM prices... you can sit on that bullion and hope the house of cards collapses and prices skyrocket but that's a pipe dream. If you believe for a second the uber-rich will give us pawns control of our own lives via gold, etc., then you're not a student of history.
The hayabusa was one sick assed bike. SDRs are the reboot.
In the end, the masses have to agree to their enslavement and that means giving them a cut. Thats why a middle class is important. Without that it's torches and pitchforks.
The pendulum always swings too far one way before swinging too far the other way. Timing is everything. I had bet this house of cards would have fallen years ago .I'm teaching my kids the truth though, as I may not live long enough to see the banksters get their comeuppance. I bet my kids do though.
Don't sell out dude. That's for sociopaths and pussies.
"The issue that has swept down the centuries and will have to be fought sooner or later is the people versus the banks", Lord Acton.
Fuck yeah! My bet is on the people!
One detail the PM naysayers miss is the numismatic niche.
Now, PMs will always be worth something.
If you have collected a nice set of coins desired by collectors, you will always have an edge over the pure bullion value.
half of the stash lost in a recent boating accident was numismatic-based. I have tried to keep my PMs in a certain ratio of numismatics vs bullion.
Is it a defining leap over bullion? No. But it does give you a slight edge.
Visit te coin shows: increase the value of your PMs by being selective!
That all fairly well works until a shooting war gets outta control.
Whenever i feel vulnerable i whip out the old ' Churchill Speeches! ' s/c
WTI down $2 from high of the day
And now for the obligatory Friday gold smackdown.
Yawn.
1200 handle obviously the red line in the sand.
Yep, right now they are keeping it in that narrow channel just below 1200.
Let's be patient...
well, either the CBs of the world collaborate to debt jubilee along with TPTB or else its every man for himself and we are back to the 30s.
1430s?
Not far off ; 1453 was cataclysmic for the west.
But 1939 was worse.
You can choose to prepare and keep things simple. Buy some land, stock the larder, ready the weapons, and wait for the worm to turn. Land can be readily placed in the production of essentials, including starches, meat, and weed. If fiat is declared worthless, you've got essential commodities to trade. While one can't move land, one can either choose to confront or evade any threat from on it. Confiscating land requires boots on the ground. Your paper assets can be confiscated with a keystroke. It's about asymmetric costs; make the confiscator risk MORE than you in order to take your asset from you. They can't send a 6-man MRAP team to everyone's property all at once, and if they really want to take your land, they have to occupy it. That gets expensive, and makes them a ripe target for guerilla action. Also, you start a business that invovles other people making their living on your land, and you instantly recruit allies to your cause, with all the G-2 that comes with it. I think gold is over-rated as a hedge against the apocolypse. Versus land, you can move it, and unlike land, it is recongized as valuable to every person in the world. But if you think at a point of global crisis, you can just leave the US and start a new life with your gold in (insert country here), you are in for an unexpected series of challenges.
Nice thinking. Diversify also. I got some gold but...My grandfather bought a ford 5000 tractor in 73 for $3500, about 100 ounces of gold. It has served and continues to serve us. It is now worth about 3500, two gold ounces and some change but we'd never sell it for that. New tractor of same horsepower about 80k, less in proportion to gold but will not be serving in 40 years. Gold, land, steel in the form of equipment, guns, ammo, you name it. Stuff that hurts when you put it on your foot versus dollars.
Not to mention they can confiscate it. which they will.
I've never really understood how someone could be a doomer/prepper on one hand, and a goldbug on the other. If things really go seriously down the toilet, how will gold save you?
It comes down to people needing food, clothing & shelter to survive. If you've thought far enough along to have the opinion that things are going to get really, really bad, if you think a little more then it seems apparent that gold (even at current prices) is expensive and of dubious help if society falls apart.
Food, clothing and shelter - and perhaps the means to protect it - is what matters. Having a bunch of the shiny yellow stuff isn't going to mean much if you have nothing to eat. If I have any of those things in that kind of situation, I'm not going to trade it for shiny metal if it's not ammo.
Extremes to one degree or the other are likely not to serve one well.
Yes the central banks are at war.
Go to a grocery store and look at the prices to see who they are war with.
An American, not US subject.
Guillotine the Fed!
F-ing A !!!!
I see only deflation when I go to the store. Hah!
Thats the man made tidal wave sucking the local businesses under. A torrent follows.
Well I don't think they're at war with one another. They work under the direction of the BIS.
Baa
"
Carmen Segarra: Um, Mike had called me into his office…
.
Jake Bernstein: This is one of the first recordings she made. It’s with her supervisor.
His name is Johnathan Kim. She’s talking to him about the meeting that she had with
Mike Silva and how upset she was by what he’d told her.
.
Carmen Segarra: … credibility at the Fed is about subtleties, perceptions as
opposed to realities...
.
Jake Bernstein: Kim had done Carmen’s job before her, and told her he’d experienced
opposition from the same people. Kim’s advice was to be patient. The Fed was trying to
change, and moving the Fed, he said, in an unfortunate metaphor, was slow like moving
the Titanic.
Meanwhile in those early months, Carmen started looking at one deal that had caught the
attention of the Fed’s team at Goldman. It’s a deal that gave her a chance to really see the Fed in action, to see what the Fed did when faced with a situation where Goldman had
done something regulators thought was questionable. Carmen remembers the moment she
first learned about the deal.
.
Carmen Segarra: Friday Jan 6th, at 3:54 PM we get an email from Goldman,
sort of alerting us to this transaction that they’re planning to close.
.
Jake Bernstein: The email said that Goldman wanted to notify the Fed about a fastmoving
negotiation between it and a large Spanish bank. The Spanish bank has
operations all over the world; it’s called Banco Santander. Santander and Goldman both
declined to comment about the deal for our story.
This email raised questions for Carmen. First of all, an alert like this was unusual.
Goldman had employees conducting deals all over the world every day, and hardly ever
wrote emails to the Fed about them. And then there was the timing, late in the afternoon
on Friday, January 6th –a date which may not mean anything to you, but Carmen knew
that it was Three Kings Day, one of the biggest national holidays in Spain.
.
Carmen Segarra: My first reaction was why are we getting this email? And then
my second thought was Banco Santander, closing a deal on the equivalent of
Christmas Eve in Spain? That’s interesting.
So you know we get back to work after the weekend, and Mike Silva is quite
upset about this transaction.
.
Jake Bernstein: Mike Silva, remember, was the Fed’s top official inside Goldman –the
one who talked to Carmen about perceptions versus reality. It’s helpful to know a bit
about Mike Silva before you hear how the Fed reacted to this deal. From everything we
can tell, he seems like a regulator who’s trying to do a good job. In the tapes, Silva talks about the Fed’s duty to serve the public. He’d been in the Navy, volunteered with
disabled veterans, and he’d gone to Iraq after the invasion to help get the country’s
national bank on its feet. And at a staff meeting once, he told his employees a story from
the darkest days of the financial crisis about what motivated him as a regulator.
.
Mike Silva: I have to tell you that night that the reserve fund broke the buck and
we got that word…
.
Jake Bernstein: It was a moment when it looked like the financial system was going to
come crashing down. Big firms were frantically calling the Fed, terrified that economic
Armageddon had arrived. When this happened, Silva was chief of staff for Tim Geithner
who, at the time, was president of the New York Fed.
.
Mike Silva: And when I realized that nobody had any idea how to respond to
that, I went into the bathroom and threw up. Because I realized this is it, it’s just
this small group of people, and right now at this moment we have no clue. I never
want to get close to that moment again.
.
Jake Bernstein: Silva told his staff that this was a very powerful experience that still
influenced his thinking. And you could hear that in the recordings after the unusual deal
came down late that Friday afternoon involving the overseas bank, Banco Santander.
What upset Mike Silva about it was that it seemed like the entire purpose of the
transaction was for Goldman Sachs to help Banco Santander appear healthier than it
actually was.
All banks have to keep some capital on hand. The more deals and loans they do, the more
capital they have to keep around, as a safety cushion, in case things go bad. Santander
was under pressure from its own regulators back in Europe to hold more capital. And this
deal with Goldman Sachs helped solve the problem for Santander. Not by giving
Santander more capital, but by taking stuff off their books, and putting it onto Goldman’s
books. Having less stuff meant Santander needed less capital. Mission accomplished.
One Fed employee likened it to Goldman getting paid to hold onto a briefcase. And as
best as they could tell, Goldman was paid a lot: at least $40 million with the potential to
make hundreds of millions in the end. Mike Silva referred to the deal this way.
.
Mike Silva: It’s pretty apparent when you think this thing through that it’s
basically window dressing that’s designed to help Banco Santander artificially
enhance its capital.
.
Jake Bernstein: To be clear, the deal appeared to be perfectly legal. Silva knew that. But
still, he wondered, did they want banks doing these sorts of transactions in the future? If
this kind of deal took off and became more popular, could it be a problem?
And in a sense, this is what you’d hope a Fed manager would be doing in the aftermath of
the financial crisis. Mike Silva learned about this new kind of deal that had come into the
world –one with potential risks that they didn’t fully understand yet. And he set his team
to work scrutinizing it.
Carmen and the others began to pore over documents for this complex transaction, which
had tentacles in Brazil, Spain, the US and the Middle East. And one of the things that
caught Carmen’s eye was a short paragraph that the banks had written into the agreement.
It said that Goldman had to notify the Fed about the Santander deal and obtain a, quote,
“no objection.” In other words, it looked like Goldman was required to get the Fed to
officially sign off on the deal, before it could close. Maybe because Goldman and
Santander worried that regulators might find this new kind of transaction hard to
swallow. But now the two banks had closed the deal. Did Goldman satisfy that part of the
contract? Here’s what Mike Silva had to say about it.
...
..
.
Brian Reed: I mean the obvious question from what you’re describing is: is that
regulatory capture?
.
Carmen Segarra: You know, if that isn’t I don’t know what is." ....
http://www.thisamericanlife.org/sites/default/files/TAL536_transcript.pdf
.
and then there is political and monetary capture, oh boy .....
analogically hilarious. notice bill cosby, alleged
serial rapist, like the federal reserve, and
central bankers in general, calling for the
"integrity" of those in the journalist occupation
to shut the fuck up regarding what they have
heard and what they know and think.
i repeat, analogically hilarious and despicable.
where is the honor and justice? when one cannot
find those there is only contempt for the ways
of "leading" men/man in the world, that, and pathetic laughter.
The CBs have caused all the conditions that have come into play to necessitate a "WAR" that was an inevitable conclusion of their obscene monetary policies. These same policies are meant to do nothing more than produce the pretext for printing fiat and cause a huge wealth transfer from the struggling, working-class to the plutocrats and oligarchs of finance and banking, all enabled by the bought politicos in D.C.. This is by design and the WAR is on us, we the people... .
Strong dollar and deflation are not good indicators of a continuing bull market!
http://www.youtube.com/watch?v=oEJza1-4zRk
https://www.youtube.com/watch?v=BhJtj-YYlXM
Wait. Since when is the RMB pegged to the dollar???
"The three men I admire most, the Father, Son, and the Holy Ghost, they took the last train for the coast, the day, the music died...............Bye Bye Miss American Pie........."
This "fighting deflation" description is so much BS. It used to be called "beggar thy neighbor", but with the printing presses in overdrive, as practiced by Japan, it is really "beggar thy worker," and ditto everywhere these so-called competetive devaluations are occurring. The Swiss debate about gold is really about Swiss Miss vs Swiss worker, who actually wants to see his wages maintain their buying p[ower