Archive for April, 2011

More Money Triangle

Whatever you may think or feel about the debasement of the US dollar, the powers that have control over the printing presses have been found using their powers to do things ‘other’ than the activity they were set up for.

Dr Bernanke explains Quantitative EasingThe Federal Reserve has been forced to release documents detailing the actions of the company during the critical 2008 melt down period.  A time when many were in confusion about what to do … the Fed was not so confused.  They used the discount window like a kind of candy gumball machine that one of them had ‘jimmied’ so that no more quarters were needed.

The results from this are only too well known, they have come to be called Quantitative Easing.

The revolving door of credit at ‘free’ was not stopped, indeed it may even now still be in use.

Bloomberg and FOX Business have obtained documents, links can be found HERE, that detail the wild times that the Discount Window handouts were going on.

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Mother of all Bubbles?

There are more signs that a ‘bubble’ in money itself has manifested.

The talk about ‘what happens after QE2’ is a real concern to anyone watching the stock market.

Quantitative Easing Rounds1 and 2Taking a look at the chart, one can see the QE 1 & 2 rounds which amount to a $1.2 Trillion change of hands.  From the public to private sectors.  The idea that the American public account can and will go on funding this sort of transfer is madness.  Yet even now the specter of a QE3 is being heard of from many sources.

Without such a continuing ‘pumping up’ of the money supply at M1, there cannot be any way to slow the decrease in M3 (from banks and other private money creation instruments).

Quite literally 25-45% of the value on the Dow or other stock indexes may simply vanish overnight as the reality of no continuing expansion of the money supply.  When this happens the ‘agreements’ of money and what anything is worth will also dissipate.

Only the most stable valuations will continue, only commodities that we cannot live without will hold value.

Do not count on such things as value comparisons or estimates based on any of the old models for comparison, such as real estate, as these methods cannot account for such a radical change in the ‘basis’ of the system.

Only those who deliver those commodities, food, fuel, water, shelter and ‘real’ opportunity will be the survivors of the coming ‘pop’ of the bubble.  Look to oil companies and their supporting industries, look to agricultural production industry, carefully examine any geographic based investment for the water needs and supply, also likewise keep in mind the housing presence for any workers in such geographic bound investments.  Finally carefully consider the government stability in providing for opportunity to the people in the region they control and in what their motives are to maintain that opportunity while remaining stable.

Welcome to the Year of living Dangerously.

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Bond rating triangle trade

The gamesmanship of AAA ratings and the ratings agencies are now starting to be laid bare.

In this entertaining video clip we see in a more open fashion what has been going on behind closed doors in Wall Street offices…

What is missing from the ‘transactions’ being discussed is the Investor money coming into the banks for selling the bonds that they talk about, keep in mind that the Investors are the ones being swindled…

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BRICS on the move

BRIC nations, primarily Russian and China, are expanding talks and taking action that moves them down the path towards a new monetary reality for the world.

Reuters is reporting that China is now offering virtually zero interest loans to other investment banks in Russia, to facilitate trade between the two nations.

This means that the US dollar is not needed as a ‘go between’ at least on transactions between entities tied to these two banks in China and Russia.

This is a pattern to be expected in the very near future, as it expands the demand for US dollars will evaporate.

Should the US dollar be rejected as a ‘reserve currency’ then it may fall to a zero value faster than anyone ever anticipated.

If you are connected to a firm doing any sort of business crossing international boundaries and are able to remove the US dollar as a factor in that trade (via a banking or other financial exchange offering) then I recommend doing so. Even if it is only in a contingent form in contracts, such items are best discussed BEFORE a crisis than during or after. Such crises tend to be rapid in formation and even faster in collapse.

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Banks now Gold bugs?

Look out for the rise in Gold now.

The banks are starting to buy in serious volumes.

This will drive Gold ever higher.

Looking for some bullion to offset fiat currency devaluation?

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