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Guest Post: Junkie Recovery

Tyler Durden's picture





 

Submitted by John Aziz of Azizonomics

Junkie Recovery

A bad jobs report that left headline unemployment above 8% — and much worse when we dig under the surface and see that the real rate is at least 11.7%, if not 14.7% or an even higher figure when we take into account those who have given up looking and claimed disability — has made QE3 seem like an inevitability for many analysts.

Reuters:

U.S. Treasuries rallied on Friday after a weaker-than-expected August U.S. jobs report boosted hopes that the Federal Reserve would buy more bonds to help shift the economy into a gear that could create higher employment.

Goldman Sachs:

We now anticipate that the FOMC will announce a return to unsterilized asset purchases (QE3), mainly agency mortgage-backed securities but potentially including Treasury securities, at its September 12-13 FOMC meeting. We previously forecasted QE3 in December or early 2013. We continue to expect a lengthening of the FOMC’s forward guidance for the first hike in the funds rate from “late 2014” to mid-2015 or beyond.

Jim Rickards:

Fed easing on Sept 13th is a done deal.

Nouriel Roubini:

Quite dismal employment report confirming anemic US economic growth. QE3 is only a matter of when not whether, most likely in December.

Gold has shot up, too, the way it has done multiple times when the market has sensed further easing:

The thing I can’t get my head around, though, is why the Federal Reserve are even considering a continuation of quantitative easing. Here’s why:

If the point of the earlier rounds of quantitative easing was to ease lending conditions by giving the financial system a liquidity cushion, then quantitative easing failed because the financial system already has a huge and historically unprecedented liquidity cushion, and lending remains depressed. Why would even more easing ease lending conditions when the financial sector is already sitting on a massive cushion of liquidity?

If the point of the earlier rounds of quantitative easing was to discourage the holding of treasuries and other “safe” assets (I wouldn’t call treasuries a safe asset at all, but that’s another story for another day) and encourage risk taking, then quantitative easing failed because the financial sector is piling into treasuries (and anything else the Fed intends to buy at a price floor) in the hope of flipping assetsto the Fed balance sheet and eking out a profit.

If the point of quantitative easing was to provide enough  liquidity to keep the massive, earth-shatteringly large debt load serviceable, then quantitative easing succeeded — but the “success” of sustaining the crippling debt load is that it remains a huge burden weighing down on the economy like a tonne of bricks.  This “success” has turned markets into junkies, increasingly dependent on central bank liquidity injections. After QE3 will come more and more and more easing until the market has either successfully managed to deleverage to a sustainable level (and Japan’s total debt level as a percentage of GDP remains higher than it was in 1991, even after 20 years of painful deleveraging — so there is no guarantee whatever that this will ever occur), or until central banks give up and let markets liquidate. Quantitative easing’s “success” has been a junkie recovery and a zombie market.

As I see it, the West’s economic depression is being directly caused by an excessive total debt burden — just as Japan’s has been for twenty years; the bust occurred on the back of a huge outgrowth of debt and coincided with the beginning of a painful new era of deleveraging. And the central bank response has been to preserve the debt burden, thus perpetuating the problems rather than allowing them to clear in a short burst of deflationary liquidation as was the norm in the 18th and 19th centuries.

Central banks have been given ample opportunity to demonstrate the effectiveness of reflationism. And yet economic activity remains depressed both in the West and Japan.

 


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Fri, 09/07/2012 - 14:43 | Link to Comment lolmao500
lolmao500's picture

And when this whole mess is unwinded, it's gonna be real ugly.

In other news...

http://www.scpr.org/news/2012/09/05/34168/senator-feinstein-says-shell-r...

Senator Dianne Feinstein says she'll reintroduce assault weapon legislation.

Remember what that biatch said in 1995...

"If I could have gotten 51 votes in the Senate of the United States for an out-right ban, picking up every one of them... 'Mr. and Mrs. America, turn 'em all in,' I would have done it. I could not do that. The votes weren't here." -- Diane Feinstein on CBS "60 Minutes", February 5, 1995.

Fri, 09/07/2012 - 14:49 | Link to Comment vast-dom
vast-dom's picture

Aziz: allow me to simplify your above line of reasoning: without QE the markets crash. that is all you need to know, impotent liquidity cushions and increased true unemployment notwithstanding.

Fri, 09/07/2012 - 14:52 | Link to Comment Aziz
Aziz's picture

The Fed could also avoid markets crashing by drugging everyone's food and water with hopium. 

Fri, 09/07/2012 - 15:30 | Link to Comment vast-dom
vast-dom's picture

that would be the average American diet plus meds and media; ie that part is actually quite more successful than QE and in many ways allowed for it.

 

the pavlovian HFT ponzi markets have narrow operating parameters predicated currently on QE which is to say fundamentals (banking liquidity vs banking) and PE are to be avoided at all costs. at all costs.

Fri, 09/07/2012 - 15:00 | Link to Comment 3rdgrader
3rdgrader's picture

Sounds like you're smoking your own hopium there pal...

Fri, 09/07/2012 - 15:03 | Link to Comment Aziz
Aziz's picture

I was being sarcastic.

Fri, 09/07/2012 - 15:03 | Link to Comment Stackers
Stackers's picture

Detox man. They just put you in a coma for 24hrs and chemically detox you. No pain. Wake up all ready for more !!!

Fri, 09/07/2012 - 16:50 | Link to Comment Panafrican Funk...
Panafrican Funktron Robot's picture

"If the point of the earlier rounds of quantitative easing was to ease lending conditions by giving the financial system a liquidity cushion, then quantitative easing failed because the financial system already has a huge and historically unprecedented liquidity cushion, and lending remains depressed. Why would even more easing ease lending conditions when the financial sector is already sitting on a massive cushion of liquidity?"

 

Liquidity cushion.  Such a funny name for theft.  Are we still pretending they didn't just outright steal money?

Fri, 09/07/2012 - 15:06 | Link to Comment SheepDog-One
SheepDog-One's picture

Let em bring it on lolmao500...its one thing to say theres an 'outright ban' and you have to 'turn em all in'....another thing to actually do it. Millions of americans know what this is all about. Molon Labe.

Fri, 09/07/2012 - 16:14 | Link to Comment crusty curmudgeon
crusty curmudgeon's picture

Millions may know what this is about but few can be counted on.  Of 1,000,000 who chant, "you can pry them from my cold, dead hands," I fear only some 100 or so would actually stand their ground when pushed.  If you doubt this, I respectfully recommend the excellent survival story in Jeff Cooper's "To Ride, Shoot Straight and Speak the Truth."  Most people haven't drawn a line in the sand.  And unless you know exactly where that line is, you tend to move it back...until it's too late.

Fri, 09/07/2012 - 17:18 | Link to Comment otto skorzeny
otto skorzeny's picture

she really is your typical Bolshevist. there is no way that gets anywhere-it is grandstanding. Gov Quinn brought it up here in pinko IL a month ago  and even he isn't dumb enough to have brought it up again.

Fri, 09/07/2012 - 14:52 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

"The thing I can’t get my head around, though, is why the Federal Reserve are even considering a continuation of quantitative easing."

By.Any.Means.Possible.Shall.The.Powerful.Retain.Power.And.Influence

<Who said cutting off your nose to spite your face was a bad idea? It's all about control.>

Fri, 09/07/2012 - 14:57 | Link to Comment knukles
knukles's picture

 

 

 

The Powerful do not wear others soiled Depends

 

(print print print print......)

Fri, 09/07/2012 - 15:01 | Link to Comment sgt_doom
sgt_doom's picture

Extremely well articulated, CD, well spoken, sir.

It kills me the number of times I hear or read the same type of sentiment over and over and over again --- "Why do they do such and such --- because they profit from doing so!

Why do those banksters lend to the private equity leveraged buyout guys?

Why do they peddles those credit derivatives forever and ever?

Why do they manipulate LIBOR, to a mind-boggling degree?

Geez, could they possibly be profiting from it?

Why do those bank robbers hit more banks located near the entrances to superhighways than other banks?

Hmmmmmm.....something about their getaway, me thinks!

Fri, 09/07/2012 - 15:28 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Our Achilles Heel is a continuously exploited fatal flaw of ours; in this case the tragic inability of us to fully comprehend (and then to accept as fact) what we consider to be impractical, immoral or downright evil acts by those in power. It is nearly impossible to fully understand and accept actions by others that we would never consider doing ourselves. To put it bluntly, the sociopath baffles and frightens us.

It is this abject failure of our imagination (an imagination that is constrained by a continuous case of cognitive dissonance) that chains us to our own false hopes (often anchored by prior mind control sessions and socially accepted propaganda [think a free and exceptional America])..........in this case that those who use and abuse their "power" will stop when showed (demanded?) the error of their ways. Sadly they will not stop, but rather will not only continue to do so, but will accelerate the insanity.

Aziz's analogy of a junkie hooked on ever increasing injections of fiat is apt. But the fiat fixation is just the symptom. The illness, the disease itself (the loss, the willing abandonment of our own personal sovereignty) is all consuming.

We are the problem. However our ego refuses to allow us to fully see this, thus we remain chained to the sociopath.

Fri, 09/07/2012 - 15:29 | Link to Comment Manthong
Manthong's picture

Most everybody in the country has been suckered into thinking that our political and economic leaders are acting on the same moral principles as the founders of the United States of America, when in fact they are acting on the same immoral principles that drove the founders to revolution.

Fri, 09/07/2012 - 16:35 | Link to Comment Aziz
Aziz's picture

I agree CogDis, that the problems are far deeper than market/social junkification.

And I tend to agree that really this all comes down to personal sovereignty.

The way to take it back is make ourselves economically independent from the state; insulate ourselves from tyranny. That means having your own energy supply, food supply, water supply, preparedness, etc. Other writers on this site, including yourself cover that particular topic of personal preparedness very well.

Fri, 09/07/2012 - 16:24 | Link to Comment Hype Alert
Hype Alert's picture

Well said, CD.  Now how do we break free?

Fri, 09/07/2012 - 16:25 | Link to Comment crusty curmudgeon
crusty curmudgeon's picture

"We are the problem."

Indeed, but how do we solve it?  Here's how:  never tolerate a lying politician.  Any politician caught in a lie should have his head handed to him (figuratively speaking).  I'm not advocating violence but rather destroying the career of any politician or public servant who lies.  For they will lie, and lie and lie to expand their power and further their greed.  They'll keep lying even as they escort you off the train and into the showers.

Fri, 09/07/2012 - 15:11 | Link to Comment kaiserhoff
kaiserhoff's picture

Absolute power corrupts absolutely.

Fri, 09/07/2012 - 15:12 | Link to Comment SheepDog-One
SheepDog-One's picture

Who said the Fed IS considering more easing? Not the Fed certainly....just the banksters and buttboy anal-ysts as usual. 

Fri, 09/07/2012 - 16:13 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

yes,

It's all about control.

but where is the fulcrum of this sociopathic control that supports this power structure?  that's what i want to know.

Fri, 09/07/2012 - 22:37 | Link to Comment Wakanda
Wakanda's picture

The fulcrum is in the psychic realm where dark forces lurk.  We often call them demons but there are other terms.  The PTB have made contracts, agreements with the dark forces and use fear to control the sheeples.

TD and others provide information for your mind to use as a weapon against the darkness.

FoCuS oN THe LiGHT.

Fri, 09/07/2012 - 14:46 | Link to Comment francis_sawyer
francis_sawyer's picture

Bath salts are a hell of a drug...

Fri, 09/07/2012 - 15:47 | Link to Comment monad
monad's picture

TV is better. It has none of the downsides, plus the hallucination can be programmed to whatever the advertisers need. Because its not a chemical sheep don't realize that its a drug; its almost perfect. Youtube is better though, because the addict adjusts the dose to optimal effect, ever at their convenience.

Welcome to the Skinner box of the real.

Fri, 09/07/2012 - 14:49 | Link to Comment docj
docj's picture

Wow. Anyone seen Karl Denninger and John Aziz in the same place lately? Because this sounds like Aziz cribbing from Denninger's book.

Fri, 09/07/2012 - 14:55 | Link to Comment Aziz
Aziz's picture

It is hard to think honestly about this subject and not reach at least partially similar conclusions, unless you're being paid to not.

Fri, 09/07/2012 - 14:56 | Link to Comment docj
docj's picture

Heh - just to be clear I did not mean that as a slam to either you or He Who Must Not Be Named At ZeroHedge.

I actually tried to edit my comment to reflect that, but for some reason I got an "access denied" error. Whatever.

Cheers -

Fri, 09/07/2012 - 22:13 | Link to Comment cbxer55
cbxer55's picture

That is because while you were trying to edit, someone had replied to your post.

Thou cannot edit what has been replied to.

Fri, 09/07/2012 - 15:02 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

All fiscal roads (thought paths) eventually lead to (the Fed) Rome.

Fri, 09/07/2012 - 15:03 | Link to Comment sgt_doom
sgt_doom's picture

Today's trivia question:

The oldest existing corporation is the City of London Corporation (wonder if there's any connection as to why London is the global financial speculation capitol???).

Was it created under the Roman Empire?  Many short-term corporations were, to create various infrastructure programs, including Hadrian's Wall, etc.

 

 

Fri, 09/07/2012 - 15:15 | Link to Comment Winston Churchill
Winston Churchill's picture

You mistake the meaning of corporation.

Corporation was a word in common use BEFORE the invention of limited liability

companies.

The City of London corporation is an UNlimited liability corporation whose owners are

the old medieval trade Guilds,Merchants,Haberdashers,Tailors etc.,

The Lord Mayor of London is an elected from the members of those guilds.

His off ice is Guild Hall.

There are no financial guilds,period.

So, apart from being totally bereft of facts,your post is l amusing es a joke,nothing else.

Fri, 09/07/2012 - 15:40 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

bullshit:

The City of London corporation is an UNlimited liability corporation

the city is incorporated by prescription because there is no surviving record of charter

Fri, 09/07/2012 - 15:47 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

bullshit:

The oldest existing corporation is the City of London Corporation

the oldest existing corporation is the office of the vatican and pope

Fri, 09/07/2012 - 16:05 | Link to Comment AlaricBalth
AlaricBalth's picture

The City of London Corporation's first recorded charter dates from around 1067. Prior to that city is regarded as incorporated by prescription.

http://www.lawrecord.com/files/37_Rutgers_L_Rec_20.pdf

Fri, 09/07/2012 - 18:49 | Link to Comment monad
monad's picture

1066 was the Norman conquest of Britain. The Norman conquerors of the later dark ages routinely created bogus histories to assert their right of dominion. Placing it that far back is absurd, and was probably done because that's the earliest date the impostors could defend. Its far more likely that it was created much later. They and their ruthless adversaries lie about everything, don't expect them to have ever told the truth about this. Or their not so innocent victims either. Their current objectives, tactics and ability to succeed are the only material details, everything else is a distraction. So far I like them alot better than the guys who like to be called Our Father, or Our Glorius Leader.

Sat, 09/08/2012 - 06:52 | Link to Comment Disenchanted
Disenchanted's picture

 

 

Yes this is a long post, if you have the attention span and the reading comprehension of a gnat don't bother. But don't say you weren't warned, and then bitch about it...bitchez.

 

Chapter 6 of Des Griffin's Descent Into Slavery:

 

THE CITY


When people think of England such terms as 'Great Britain,' 'The Queen,' 'The Crown,' 'Crown Colonies,' 'London,' 'The City of London,' and 'British Empire' come to mind and blend together into an indistinguishable blur. They are generally looked upon as synonymous, as being representative of the same basic system. During the 1950s and 1960s the author lived in England (London for five years) without even beginning to realize the vast difference that exists in the meaning of some of the above terms.

 

When people hear of 'The Crown' they automatically think of the King or Queen; when they hear of 'London' or the 'The City' they instantly think of the capital of England in which the monarch has his or her official residence.

 

To fully understand the unique and generally unknown subject we must define our terms:

 

When we speak of 'The City' we are in fact referring to a privately owned Corporation - or Sovereign State - occupying an irregular rectangle of 677 acres and located right in the heart of the 610 square mile 'Greater London' area. The population of 'The City' is listed at just over four thousand, whereas the population of 'Greater London' (32 boroughs) is approximately seven and a half million.

 

The 'Crown' is a committee of twelve to fourteen men who rule the independent sovereign state known as London or 'The City.' 'The City' is not part of England. It is not subject to the Sovereign. It is not under the rule of the British parliament. Like the Vatican in Rome, it is a separate, independent state. It is the Vatican of the commercial world.

 

The City, which is often called "the wealthiest square mile on earth," is ruled over by a Lord Mayor. Here are grouped together Britian's great financial and commercial institutions: Wealthy banks, dominated by the privately-owned (Rothschild controlled) Bank of England, Lloyd's of London, the London Stock Exchange, and the offices of most of the leading international trading concerns. [Such as the British Invisibles, I kid you not]. Here, also, is located Fleet Street, the heart and core of the newspaper and publishing worlds.

 

TWO MONARCHS


The Lord Mayor, who is elected for a one year stint, is the monarch in the City. As Aubrey Menen says in "London", Time-Life, 1976, p. 16: "The relation of this monarch of the City to the monarch of the realm [Queen] is curious and tells much." It certainly is and certainly does !

 

When the Queen of England goes to visit the City she is met by the Lord Mayor at Temple Bar, the symbolic gate of the City. She bows and asks for permission to enter his private, sovereign State. During such State visits "the Lord Mayor in his robes and chain, and his entourage in medieval costume, outshines the royal party, which can dress up no furhter than service uniforms." The Lord Mayor leads the queen into his city.

 

The reason should be clear.

 

The Lord Mayor is the monarch.

 

The Queen is his subject !

 

The monarch always leads the way.

 

The subject always stays a pace or two behind !

 

The small clique who rule the City dictate to the British Parliament. It tells them what to do, and when. In theory Britain is ruled by a Prime Minister and a Cabinet of close advisers. These 'fronts' go to great lengths to create the impression that they are running the show but, in reality, they are mere puppets whose strings are pulled by the shadowy characters who dominate behind the scenes. As the former British Prime Minister of England during the late 1800s Benjamin D'israeli wrote: "So you see... the world is governed by very different personages from what is imagined by those who are not behind the scenes" (Coningsby, The Century Co., N.Y., 1907, p. 233).

 

This fact is further demonstrated by another passage from Menen's book: "The Prime Minister, a busy politician, is not expected to understand the mysteries of high finance, while the Chancellor of the Exchequer [Budget Director] is only expected to understand them when he introduces the budget. Both are advised by the permanent officials of the Treasury, and these listen to the City. If they suspect that some policy of the government will [back-fire]... it is no use their calling up British ambassadors to ask if it is so; they can find out more quickly from the City. As one ambassador complained to me, diplomats are nowadays no more than office boys, and slow ones at that.

 

"The City will know. They will tell the Treasury and the Treasury will tell the Prime Minister. Woe betide him if he does not listen. The most striking instance of this happened in recent history. In 1956 the then Prime Minister, Sir Anthony Eden... launched a war to regain the Suez Canal. It had scarcely begun when the City let it be known that in a few days he would have no more money to fight it; the Pound would collapse. He stopped the war and was turned out of office by his party. When the Prime Minister rises to address the Lord Mayor's banquet, he hopes that the City will put more behind him than the gold plate lavishly displayed on the sideboard" (p. 18).

 

History clearly reveals that the British government is the bond slave of the "invisible and inaudible" force centered in the City. The City calls the tune. The "visible and audible leaders" are mere puppets who dance to that tune on command. They have no power. They have no authority. In spite of all the outward show they are mere pawns in the game being played by the financial elite.

 

HISTORY of the 'CITY'


From the time of William the Conqueror until the middle of the seventeenth century the British Monarchs ruled supreme - their word was law. They truly were Sovereign in every sense of the word.

 

As British strength and influence grew around the world toward the end of the 1600s the wealth, strength and influence of the elite merchants in the City also grew - only at a faster pace. In 1694 the privately owned Bank of England (a central bank) was established to finance the profligate ways of William III. The bank was financed by a group of City merchants who used William Paterson as a 'front.' The names of the founders have never been made public.

 

It was at that juncture that the Bank of England and the City began to dominate and control the affairs of Britain. Their influence and wealth grew in leaps and bounds in the century that followed. "The Illustrated Universal History," 1878, records that "Great Britain emerged from her long contest with France with increased power and national glory. Her Empire was greatly expanded in all parts of the world; her supremacy on the sea was undisputed; her wealth and commerce were increased... But with all this national prosperity, the lower classes of the English people were sunk in extreme wretchedness and poverty, having been bled dry during the struggle of the previous twenty years.

 

It was at this juncture (1815) that the House of Rothschild seized control of the British economy, the Bank of England and the City - and, through their other branches, control of the other European nations.

 

Prior to this period Britain had developed colonies and outposts in the far-flung reaches of the globe. Having been thrown out of the Western Hemisphere, Britain now concentrated on acquiring and developing additional possessions elsewhere.

 

During its heyday in the nineteenth century approximately 90% of all international trade was carried in British ships. Other shippers had to pay the Crown royalties or commissions for the 'privilege' of doing business on the high seas. During these years 'Britannia Ruled the Waves' through the domination of the most modern and powerful navy known up to that time.

 

TWO SEPARATE EMPIRES


To avoid misunderstanding, it is important that the reader recognize the fact that two separate empires were operating under the guise of the British Empire. One was the Crown Empire and the other was the British Empire.

 

All the colonial possessions that were white were under the Sovereign - i.e. under the authority of the British government. Such nations as the Union of South Africa, Australia, New Zealand and Canada were governed under British law. These only represented thirteen percent of the people who made up the inhabitants of the British Empire.

 

All the other parts of the British Empire - nations like India, Egypt, Bermuda, Malta, Cyprus and colonies in Central Africa, Singapore, Hong Kong and Gibraltar (those areas inhabited by the browns, yellows and blacks) were all Crown Colonies.

 

These were not under British rule. The British parliament had no authority over them. They were privately owned and ruled by a private club in London, England known as the Crown. The Crown's representative in such areas held the absolute power of life and death over all the people under his jurisdiction. There were no courts and no method of appeal or retribution against a decision rendered by the representatives of the Crown. Even a British citizen who committed a crime in a Crown colony was subject to the Crown law. He couldn't appeal to British law as it didn't apply.

 

As the Crown owned the committee known as the British government there was no problem getting the British taxpayer to pay for naval and military forces to maintain the Crown's supremacy in these areas. Any revolts were met with terrible retribution by the British navy at no cost to the Crown.

 

The City reaped fantastic profits from its operations conducted under the protection of the British armed forces. This wasn't British commerce and British wealth. The international bankers, prosperous merchants and the British aristocracy who were part of the 'City' machine accumulated vast fortunes which they lavishly squandered in their pursuit of prestige and standing in British Society. Had the wealth been spread out among all the people in the British Isles prosperity would have abounded.

 

In spite of the wealth of the world flowing into the City the majority of the British people were barely making ends meet. Many were impoverished to the point of despair. The elite lived in regal splendor. The poor British peasants were never given a chance to get a cut of the action.

 

Simon Haxey in "England's Money Lords Tory M.P.," drew his readers' attention to the "total disregard or open contempt displayed by the aristocracy" towards the British people. He also asked, "What part do the colonial people play in the battle for democracy when they themselves have no democratic rights and the British governing class refuses to grant such rights" (pp. 114,115)

 

David Lloyd George, a future prime minister, emphasized the power of the City and its total contempt for the "wretches" who were not part of the 'club.' In a 1910 speech he stated: "We do most of the business of the world. We carry more international trade - probably ten times more - than Germany. Germany carries her own trade largely. The international trade is ours. Well, we do not do it for nothing. As a matter of fact, our shipping brings us over a hundred millions (pounds) a year, mostly paid by that wretched foreigner. I'm taxing the foreigner for all I know... You've heard a good deal of talk here, probably, about the exportation of capital abroad. There is no way in which we can make the foreigner pay more... We get the foreigner in four ways by that. The first way we leave to Lord Rothschild..." ("Better Times", published 1910).

 

About seventy years ago Vincent Cartwright Vickers stated that "...financiers in reality took upon themselves, perhaps not the responsibility, but certainly the power of controlling the markets of the world and therefore the numerous relationships between one nation and another, involving international friendship and mistrusts... Loans to foreign countries are organized and arranged by the City of London with no thought whatsoever of the nation's welfare but soley in order to increase indebtedness upon which the City thrives and grows rich... This national and mainly international dictatorship of money which plays off one country against another and which, through ownership of a large portion of the press, converts the advertisement of its own private opinion into a semblance of general public opinion, cannot for much longer be permitted to render Democratic Government a mere nickname. Today, we see through a glass darkly; for there is so much which 'it would not be in the public interest to divulge'..." (E.C. Knuth, "Empire of 'The City'", p. 65).

 

All of the above points were stressed by Roland G. Usher on pages 80, 83 and 84 of "Pan Germanism," written in 1913: "The London and Paris bankers [the international bankers] control the available resources of the world at any one moment, and can therefore practically permit or prevent the undertaking of any enterprise requiring the use of more than a hundred million dollars actual value..."

 

The international bankers "own probably the major part of the bonded indebtedness of the world. Russia, Turkey, Egypt, India, China, Japan, and South America are probably owned, so far as any nation can be owned, in London or Paris. Payment of interest on these vast sums is secured by the pledging of the public revenues of these countries, and, in the case of the weaker nations, by the actual delivery of the perception into the hands of the agents of the English and French bankers. In addition, a very large share, if not the major part, of the stocks and industrial securities of the world are owned by those two nations and the policies of many of the world's enterprises dictated by their financial heads. The world itself, in fact, pays them tribute; it actually rises in the morning to earn its living by utilizing their capital, and occupies its days in making them still wealthier."

 

In 1946 E.C. Knuth wrote: "The bulwark of the British financial oligarchy lies in its ageless and self-perpetuating nature, its long-range planning and prescience, its facility to outwait and break the patience of its opponents. The transient and temporal statesmen of Europe and particularly of Britain itself, who have attempted to curb this monstrosity, have all been defeated by their limited tenure of confidence. Obligated to show action and results in a too short span of years, they have been outwitted and outwaited, deluged with irritants and difficulties; eventually obliged to temporize and retreat. There are few who have opposed them in Britain and America, without coming to a disgraceful end, but many, who served them well, have also profited well" ("Empire of 'The City,'" p. 65).

 

== END of CHAPTER 6 from the book "DESCENT into SLAVERY", by Des Griffin

 

Read between the lines of this 2002 Alan Greenspan speech in London:

 

In a more serious vein, I am daily reminded of the special relationship the Federal Reserve has had over the decades with decisionmakers from the British government. Literally twenty feet from my desk are plaques commemorating the numerous World War II meetings in our Board Room between the combined military chiefs of the United States and Great Britain that in the words on one plaque, "... set the pattern for allied collaboration and the successful prosecution of World War II."

 

But the Federal Reserve's association with Britain's monetary authorities goes back even further. The tie between the Bank of England and the Federal Reserve was cemented during the 1920s in that extraordinary relationship between Benjamin Strong, the President of the New York Federal Reserve Bank, and Montague Norman, the Governor of the Bank of England. Their correspondence yields quite fascinating insight into the way they interpreted events that are now important history. The ties developed then between the Federal Reserve and British monetary authorities endure to this day.~ Alan Greenspan 2002

 

Further along in his speech Greenspan had this to say about "The City":

 

Today's remarkably sophisticated international financial system, that all these bodies oversee, took root several centuries ago within hailing distance of Her Majesty's Treasury. The rule of law and protection of property rights attracted transactions to the London market and--notwithstanding the one incident of questionable behavior in 1720 noted earlier--the British tradition of trust, integrity, and fair dealing has been an important component of the City's success. London, and other British financial centers, had developed by World War I into the dominant lender to the world, accounting for half of the world's trade financing and, despite its loss of empire, London remains, with New York, at the top of the world's financial pyramid.

 

The City has a long tradition of leading the world in foreign exchange trading and currently conducts twice the volume of New York despite the fact that the U.S. dollar is the leading traded currency by far in foreign exchange transactions. London is the world's center for over the counter derivatives trading--again with double the share of the trading in similar instruments conducted in New York. Moreover, a substantial share of the world's securities trading is channeled through the City.

 

IMO - The Vatican/Rome may have once controlled things but when they allowed the Rothschilds to become their bankers("guardians of the Vatican treasure") they were co-opted and then controlled. Just like the United States was co-opted and then controlled with the establishment of the 'Federal Reserve' central bank(and it's "special relationship" with the BOE per Greenspan). Now it's all over but the crying...

I've posted this here before, but the trinity of global empire in the 'new age' are:

 

["The City"]London(finance)

Vatican(religion)

Washington DC(military)

 

All three are sovereign city states. But I think the other two defer to London/BOE/the Red Shields.

Fri, 09/07/2012 - 16:08 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

well,

All fiscal roads (thought paths) eventually lead to (the Fed) Rome.

in my thought paths, all roads lead to vatican, inc. and the master jesuit order puppeteers running the joint in their top notch sociopathic ways...including the poor guy w/ tiara on his head

Fri, 09/07/2012 - 14:50 | Link to Comment fonzannoon
fonzannoon's picture

Maybe, since the fed knows it has failed, they will just print a bunch of money, give it to the banks, then split it all up amongst themselves and get another years worth of hookers and blow while telling everyone else they just need to give the economy more time? Why do we have to complicate it?

Fri, 09/07/2012 - 14:55 | Link to Comment knukles
knukles's picture

Private Justin Beiber concert, too.

 

 

(thought to self; you should be embarrassed, that is just so fucking gay...)

Fri, 09/07/2012 - 15:05 | Link to Comment Haager
Haager's picture

They also can openly burn dollar notes at the front of their house. That would be more helpful.

Fri, 09/07/2012 - 14:52 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Of course the owners of the Federal Reserve (a private bank) want to "preserve the debt burden" that is their income (money for doing absolutely nothing- thank you western taxpayers).

Fri, 09/07/2012 - 14:57 | Link to Comment 3rdgrader
3rdgrader's picture

They did do someting... they lifted their finger to press the "print" button... that justifies their $963,956,376,942,000 per year salary!

Fri, 09/07/2012 - 16:38 | Link to Comment Hype Alert
Hype Alert's picture

Tyler posted a response to a post some time back pointing out wiping out that debt will be the absolute last thing they will do.  And probably why they will not allow this market to drop.  It IS their wealth.

 

They do not care about the muppets and will allow all to burn first.

Fri, 09/07/2012 - 15:00 | Link to Comment Still Life Living
Still Life Living's picture

When the smack begins to flow
Then I really don't care anymore
About all the Jim-Jims in this town
And everybody putting everybody else down
And all of the politicians makin' crazy sounds
All the dead bodies piled up in mounds

That heroin is in my blood
And the blood is in my head
Thank God that I'm good as dead
Thank your God that I'm not aware
And thank God that I just don't care

 

Next comes the screetching feedback.............

Fri, 09/07/2012 - 16:17 | Link to Comment DavidPierre
DavidPierre's picture

So good ... so long ago!

The Velvet Underground
Heroin

http://www.youtube.com/watch?v=ffr0opfm6I4

And I guess

I just don't know

.........................................

 

Buffy Sainte Marie
Cod'ine

http://www.youtube.com/watch?v=d3bfqlTCHZk&feature=related

 

Little wheel spin and spin

http://www.youtube.com/watch?v=6hVBFBCfN6E&feature=BFa&list=AL94UKMTqg-9...


Fri, 09/07/2012 - 15:01 | Link to Comment crusty curmudgeon
crusty curmudgeon's picture

And if the point of all that quantitative easing was for Ben to give money to his bankster buddies, taking advantage of the crisis as a way to justify it, then it seems to me it was pretty darn successful.  Look at all those excess reserves.  I don't know much, but I know they won't be there forever...that spike will drop back to historic levels.  That's when I'll buy more donuts with my silver.  And bacon too.  Lots and lots of bacon.

Fri, 09/07/2012 - 15:19 | Link to Comment Aziz
Aziz's picture

As I have written many, many times on ZH and in other places transferring wealth to the financial sector is the underlying reality with QE (Cantillon Effect). But that was the case with traditional monetary policy operations since the end of the gold standard, too. That easy monetary policy enriches the banksters is assumed, because it's obvious. 

Enjoy your donuts and bacon. 

Fri, 09/07/2012 - 15:04 | Link to Comment crusty curmudgeon
crusty curmudgeon's picture

Tyler is clearly sharp--way more so than me.  I wish I understood what he sees in Aziz.

Fri, 09/07/2012 - 15:16 | Link to Comment kaiserhoff
kaiserhoff's picture

Works cheap?  I think he's right about the rolling depression, but let's keep this simple.

There is no exit strategy.

Fri, 09/07/2012 - 15:55 | Link to Comment crusty curmudgeon
crusty curmudgeon's picture

My "edit" button disappeared so I can't remove my ad hominem attack, so I'll just apologize for it.  Sorry.  It's much easier to say something quick (and stupid) than to back it up with a cogent explanation -- and I thought I was above that. 

Fri, 09/07/2012 - 15:02 | Link to Comment Haager
Haager's picture

Other QE-efforts obviously didn't trickle down to employees, but replaced existing workplaces with lower waged jobs. What do  the lower 50% US-citizens gain from such QE-effort that will firstly went into stock markets - and prices?

Fri, 09/07/2012 - 18:05 | Link to Comment Law97
Law97's picture

Excellent point.  What seems to be missing from the whole QE debate is how it is highly redistributionist.  Perhaps because it is *from* the middle class and poor and *to* the rich, your typical conservatives, who are so quick to point out government imposed redistribution the *other* way, haven't caught on.  And your typical liberals still can't fathom that this massive wealth transfer to the rich could happen under a Democratic administration.   It's refreshing to see Romney/Ryan finally starting to make feeble attempts at criticizing the Fed. 

But back to your post, this redistribution is far worse than even the typical welfare checks to the poor.  Reason is that is is actually destroying the economy itself (not just waste) and the  founding principles of our country such as free market capitalism, individual liberty, representation, and rule of law.

Fri, 09/07/2012 - 15:05 | Link to Comment sgt_doom
sgt_doom's picture

Hope everyone heard Max Keiser's outstanding interview on Bonnie Faulkner's "Guns and Butter" show (American radio, KPFA).

Unfortunately, I agree with everything Max said .....

Fri, 09/07/2012 - 15:05 | Link to Comment HAhyperion
HAhyperion's picture

ECB and FED constant more liquidity when it is a solvency issue: and we see the markets heralded the news.  As the old band Chicago sung  "Does anyone really know what time it is?" 

De facto gold standards and commodity spikes and increases -

When no one can afford a loaf of bread...they will know what time it is 

Debt forgiveness and write offs PLEASE 

Fri, 09/07/2012 - 15:15 | Link to Comment startingnow
startingnow's picture

QE in all its many forms was inevitable the day they "broke the buck'.  That was an electronic  bank run happening almost instantaneously, and it scared the bjesus out of the financial world.  The tactic of excess bank liquidity, the artificial pumping up of the stock market, along with lots of other tactics such as the end of 'mark to market' are the Fed/ Tres. efforts to handle/ forestall bank runs such as occurred in 1929.

It's all wallpaper, about as thick as wallpaper and about as durable.  But they will do it, until they can't.

Fri, 09/07/2012 - 15:15 | Link to Comment BandGap
BandGap's picture

Addictions take a long time to kill the host. Anyone who has ever known an alcoholic or substance abuser and has watched them waste away knows this. It is amazing, the punishment the human form can bring about upon itself without collapsing for years.  No differnet for our economy. I think the cureent administration is a bit mazed, but they keep pushing.

But like the junkie pictures we see online, as the years go by you can see the toll. The toll, as written on their faces, tells the story. What is on the face of the current global monetary situation?

I don't need a Bonzai production to see where we stand (although I do enjoy these) these days. The lies the bolder, just like a junkie, and the situations more outlandish and bizarre. And we watch and wait.

More.

Fri, 09/07/2012 - 16:15 | Link to Comment RunningMan
RunningMan's picture

Well said. The reason many posters seem miffed is that they see QE and the intervention/manipulation as (i) originally glossing over the real problem, and now (ii) being part of the problem. An addict surrounded by people who accept the addiction is in far worse shape than someone surrounded by people who care and intervene. These markets, and our economy as a whole are very sick. To extend the analogy, now the Fed is enabling the addiction, when the economy needs to go cold turkey. Why? They don't want to deal with the ugliness that comes from quitting the stuff. And as BandGap says, it can go on a long time without collapsing, but eventually it comes to a poor end.

Fri, 09/07/2012 - 15:17 | Link to Comment vertexa
Fri, 09/07/2012 - 15:19 | Link to Comment q99x2
q99x2's picture

Silver $33.73. Have to ask Keiser at what point Jamie Dimon's naked shorts blow up.

Fri, 09/07/2012 - 15:29 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

dont bother, keiser doesnt know

Silver $33.73. Have to ask Keiser at what point Jamie Dimon's naked shorts blow up.

Fri, 09/07/2012 - 15:25 | Link to Comment BanjoDoug
BanjoDoug's picture

What a worthless article....  Aziz ain't worth reading.   Furthermore, the crisis in Europe today is providing a lot of buyers in T-Debt, Gold, the markets, etc.....   but this will run its course and at some point the Fed will be the only buyer again, esp in T-Debt to keep the ship floating for a little while longer.   Remember, never think TPTB can't successfully kick the can down the road again, even if it has some undersirable consequences....

Fri, 09/07/2012 - 15:27 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

something about flow, no?

The thing I can’t get my head around, though, is why the Federal Reserve are even considering a continuation of quantitative easing.

Fri, 09/07/2012 - 15:54 | Link to Comment Aziz
Aziz's picture

There are other ways of achieving flow without buying assets from banks in exchange for new currency. One of them is letting markets liquidate so that we can have an organic recovery instead of a zombie depression. Another is using a different transmission channel that doesn't dump the money immediately into the financial sector.

Fri, 09/07/2012 - 15:33 | Link to Comment dbTX
dbTX's picture

If the Fed is going to QE, why give it to distributors (banks) why not just send every tax payer a check. QE to banks is a perfect example of trickle down, so hated by Obama.

Fri, 09/07/2012 - 18:08 | Link to Comment Law97
Law97's picture

Because the purpose of QE is not to help the economy (although the Fed isn't necessarily against helping the economy, they just don't care one way or the other imo), but rather the purpose is to shower windfall profits on the oligarchs.

Fri, 09/07/2012 - 15:54 | Link to Comment Snakeeyes
Snakeeyes's picture

Note that the Fed's massive juicing of the economy hasn't done squat for unemployment.

http://confoundedinterest.wordpress.com/2012/09/07/economy-adds-only-960...

Fri, 09/07/2012 - 16:08 | Link to Comment Aziz
Aziz's picture

I wish the Keynesians would pay attention to this fact.

Krugman always screaming about unemployment (he's right to — it's a massive problem). How does he wanna fight unemployment? More QE!! Because trillions of that led to an employment recovery didn't it? 

Fri, 09/07/2012 - 19:15 | Link to Comment LMAOLORI
LMAOLORI's picture

 

 

Krugman is a Liberal Elitist Central Planning Clown. He doesn't know the first thing about job creation the only thing he wants to create is more government dependency and government jobs. What you don't seem to understand is the ultra rich and the bankers got obama elected in the first place and now you think he or krugman would want them to go cold turkey. Crony Capitalism it's the obama way!

Fri, 09/07/2012 - 16:46 | Link to Comment dadichris
dadichris's picture

Why QE3 in spite of the fact that it failed at it's stated goal? Because it is succeeding at the unstated goal of undermining the USD as the world reserve currency.

Get your head around that.

Sat, 09/08/2012 - 12:31 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

If the point of the earlier rounds of quantitative easing was to ease lending conditions by giving the financial system a liquidity cushion, then quantitative easing failed because the financial system already has a huge and historically unprecedented liquidity cushion, and lending remains depressed. Why would even more easing ease lending conditions when the financial sector is already sitting on a massive cushion of liquidity?

 

Debt issuance began September with a bang.  Investment grade issuers this week included GE Capital $4.0bn, Wellpoint $3.25bn, Berkshire Hathaway $2.28bn, EOG Resources $1.25bn, John Deere $1.0bn, SLM Corp $800 million, Norfolk Southern $600 million, Waste Management $500 million, American Honda Finance $1.5bn, Public Service Colorado $800 million, CMR Group $750 million, Rock-Tenn $700 million, Nissan Motor Acceptance $650 million, Principal Financial $600 million, NVR $600 million, Flowserve $500 million, Union Electric $485 million, Avalonbay Communities $450 million, Air Products & Chemicals $400 million, Verisk Analytics $350 million, Marriott International $350 million, Portmarnock Leasing $190 million, and Associate Banc-Corp $155 million, . 

Junk bond funds saw inflows slow to $201 million (from Lipper).  Junk issuers included QEP Resources $650 million, American Axle & Manufacturing $550 million, Starz $500 million, Catalent Pharma Solution $350 million, and Carrizo Oil & Gas $300 million.

I saw no convertible debt issued.   

International dollar bond issuers included Vale $1.5bn, Digicel Group $1.5bn, BNP Paribas $1.25bn, Kommunalbanken $1.2bn, Banco Santander $1.3bn, Bancolombia $1.15bn, Inter-American Development Bank $1.0bn, Overseas Chinese Banking $1.0bn, Korea Development Bank $750 million, Australia & New Zealand Bank $3.0bn, Smurfit Kappa $300 million, WPP Finance $800 million, Hub International $740 million, Banco Cred Inver $600 million, Hudbay Minerals $500 million and Aruba $250 million.

me again :> i don't think Treasury borrowing is down either;  the REITs did quite well price-wize on their re-fis ALONE;  the roll + the "extra" from the low vig goosed their prices

<yawn>

mebbe the FED will QE next week

<yawn>

 

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