Is the currency game almost over?

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Is the currency game almost over?

Jim Rickards:

“What is a currency war?  What they mean is each currency is trying to devalue against all of the others.  They all want to devalue but they can’t, it is a zero sum game.  Some people can devalue some of the time, but not everyone can devalue all of the time.”

“What is the solution?  The solution is to identify a store of value that everyone can devalue against all at once.  And there are two obvious candidates.  First is gold, and second it is to invent a currency.”

“The preference of central banks is to invent a currency such as the SDR or the Bancor.  But, the market’s preference seems to be for gold.  So the currency war comes down to a race between gold and the new paper currency.  Who will win?”

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Hedge fund manager "Eric Sprott" says Fed is now buying it's own Treasury's and can't stop QE 2 because of it.The Gov. has to support the bond market or the whole thing collapses.

http://www.financialsense.com/financial-sense-newshour/big-picture/2010/...

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Re: Is the currency game almost over?

“What is the solution?

Cancel all debts.......  they will never ever be repaid, let's stop pretending they will.

Mike

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Re: Is the currency game almost over?

Michael Hudson offers a thought-provoking synopsis of how we got into this pickle:

For many centuries prior to 1971, nations settled their balance of payments in gold or silver. This “money of the world,” as Sir James Steuart called gold in 1767, formed the basis of domestic currency as well. Until 1971 each U.S. Federal Reserve note was backed 25 per cent by gold, valued at $35 an ounce. Countries had to obtain gold by running trade and payments surpluses in order to increase their money supply to facilitate general economic expansion. And when they ran trade deficits or undertook military campaigns, central banks restricted the supply of domestic credit to raise interest rates and attract foreign financial inflows.

What destabilized this system was war spending. War-related transactions spanning World Wars I and II enabled the United States to accumulate some 80 per cent of the world’s monetary gold by 1950. This made the dollar a virtual proxy for gold. But after the Korean War broke out, U.S. overseas military spending accounted for the entire payments deficit during the 1950s and ‘60s and early ‘70s. Private-sector trade and investment was exactly in balance.

By August 1971, war spending in Vietnam and other foreign countries forced the United States to suspend gold convertibility of the dollar through sales via the London Gold Pool. But largely by inertia, central banks continued to settle their payments balances in U.S. Treasury securities. After all, there was no other asset in sufficient supply to form the basis for central bank monetary reserves. But replacing gold – a pure asset – with dollar-denominated U.S. Treasury debt transformed the global financial system. It became debt-based, not asset-based. And geopolitically, the Treasury-bill standard made the United States immune from the traditional balance-of-payments and financial constraints, enabling its capital markets to become more highly debt-leveraged and “innovative.” It also enabled the U.S. Government to wage foreign policy and military campaigns without much regard for the balance of payments.

The problem is that the supply of dollar credit has become potentially infinite. The “dollar glut” has grown in proportion to the U.S. payments deficit. Growth in central bank reserves and sovereign-country funds has taken the form of recycling of dollar inflows into new purchases of U.S. Treasury securities – thereby making foreign central banks (and taxpayers) responsible for financing most of the U.S. federal budget deficit. U.S. “quantitative easing” is coming to be perceived as a euphemism for a predatory financial attack on the rest of the world. Trade and currency stability are part of the “collateral damage” being caused by the Federal Reserve and Treasury flooding the economy with liquidity in their attempt to re-inflate U.S. asset prices. Faced with U.S. quantitative easing flooding the economy with reserves to “save the banks” from negative equity, all countries are obliged to act as “currency manipulators.” So much money is made by purely financial speculation that “real” economies are being destroyed.

The global financial system is being broken up as U.S. monetary officials change the rules they laid down nearly half a century ago. Prior to the United States going off gold in 1971, nobody dreamed that an economy – especially the United States – would create unlimited credit on computer keyboards and not see its currency plunge. But that is what happens under the Treasury-bill standard of international finance. Under this condition, foreign countries can prevent their currencies from rising against the dollar (thereby pricing their labor and exports out of foreign markets) only by (1) recycling dollar inflows into U.S. Treasury securities, (2) by imposing capital controls, or (3) by avoiding use of the dollar or other currencies used by financial speculators in economies promoting “quantitative easing.”

http://counterpunch.org/hudson10112010.html

What Hudson calls the 'Treasury-bill standard of international finance' has puzzled observers for years. Mad Al Greenspan called it a 'conundrum.' The essence of the conundrum is that the U.S. is steadily devaluing the dollar's purchasing power: under conventional macroeconomic assumptions, the dollar's value should fall, while U.S. interest rates should rise to attract capital into a weakening currency.

But the opposite is happening: because of the dollar's lingering quasi-monopoly as the central reserve currency, foreign central banks are obliged to buy it (via investments in Treasury securities) against their will, to keep their own currencies from appreciating against the dollar and eroding their own trade competitiveness.

The implication is that both Treasury prices and the dollar are artificially propped up by foreign official purchases. And it follows that this unsustainable charade will end quite suddenly and chaotically one fine day, for no particular reason other than one cow at the edge of the herd gets spooked, and suddenly the panicked thundering herd is trampling down fences and entire villages.

Gold's price may already be discounting this event. Gold investors (which include central banks), I would assert, are forward looking. Whereas official purchases of Treasury securities, which have driven the Fed's custody account up to an astounding $3.25 trillion, are largely a backward-looking, mechanical, non-market-based defense of the misbegotten, anachronistic Bretton Woods II international fiat currency regime.

BW II is showing ominous stress cracks. One day it may go poof just as suddenly as BW I did when Richard Nixon unceremoniously slit its throat on 15 August 1971 to spite the gold-bug French and their Le Defi Americain style sniping at America's 'exorbitant privilege.'

Now as then, the rickety system is swaying because the U.S. is spewing irredeemable dollars to finance another lost war (Afghanistan), as well as to maintain a global military empire which does not and cannot pay for itself. It turns out that both the USSR and the US lost the Cold War, spending themselves into national bankruptcy with their superpower fantasies.

As Michael Hudson goes on to describe, China is already doing bilateral deals with other developing countries to sidestep the use of dollars in trade settlement. China does not yet have the clout to insist on being paid in yuan for its exports to the US. But someday it will. And how is the US going to earn enough yuan, when it imports so much more than it exports?

Crikey, we may have to stop printing counterfeit Federal Reserve Notes and go back to earning an honest living! Wouldn't that be a kick in the head, especially for the grey-crowned, grumbly Boomers!

Why do bad things happen to good people? FrownYell

 

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Re: Is the currency game almost over?

“What is the solution?

Cancel all debts.......  they will never ever be repaid, let's stop pretending they will.

Mike

 

I couldn't agree more but greed will keep that from happening.

 

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Re: Is the currency game almost over?

 

Great post, Machinehead. As usual.

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Re: Is the currency game almost over?

>Cancel all debts.......  they will never ever be repaid, let's stop pretending they will.

Lets say there was some kind of world agreement to cancel all debts at once now.

All the people/companies/countries with lots of debt would ofcourse cheer in joy, but ofcourse there is a downside.
The lenders lost an incredible amount of money, without doing anything wrong. They will ofcourse not like this, but more importantly they will not do the same misstake again, so we would permanently have shut the door for all lending worldwide.

What would happen to the ones who did constantly borrow more money, like the US?

I think those countries would turn into chaos, and that will happen very quickly.
We would likely see major shortages of all sorts of items, particularly things that comes from major exporting countries today.
Things like oil, cloth, shoes, and to some extent food comes to mind as the most essential.
While this would be really cruel it would likely kill lots of people from starving etc and start quite a few wars that would kill even more.
After a long while we could end up with 1/3 less people on earth, and that would be easier to sustain. 

These severe consequences does in my mind make such a move one of the worst changes to make.
A soft version would be to remove interest or just put a fixed very low interest rate on all loans, as the change is much softer the outcome is also much softer.

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Re: Is the currency game almost over?
Damnthematrix wrote:

“What is the solution?

Cancel all debts.......  they will never ever be repaid, let's stop pretending they will.

I am afraid I must agree with silvervarg.  That is great rhetoric but horrible policy!

Can you imagine a greater injustice than every fool that bought a Mc Mansion, two BMW's, a boat, and a summer home with 2% down on credit getting to keep their stuff, while the smart working stiff that did not live above their means and has nearly paid off their modest home, gets nothing.  Actually it would be worse than nothing because suddenly their measly savings would never have a chance of buying any of the stuff the fool's own outright.

Whatever happens needs to be equitable or there is a high risk of blood in the streets.   Most people can live with inequality as long as it was the results of some sort of "near" fair system.  If debts get forgiven for all without looking at where the debts came from, that would be a recipe for disaster. 

This is the same reason the bailouts have gone over so poorly with the general public.  It is very difficult to accept such an inequitable result of rule changes.  If the so called bailouts that saved the system, would have at  spread their benefits more equitably, there would be a lot less anger and the Tea Party might not exist.

If DC continues to change rules (laws) in ways that benefit some over others, they are playing with fire!

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Re: Is the currency game almost over?

Machinehead, post 2.

Terrific post as usual.  I learn a lot from you.

Travlin 

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Re: Is the currency game almost over?

Then there was this… From The Washington Post

Report warns of coming wave of municipal pension shortfalls

The nation’s largest municipal pension plans are carrying a total unfunded liability of $574 billion, which comes on top of as much as $3 trillion in unfunded pension promises made by the states, according to a report released Tuesday.

The report calls the unfunded pension obligations “off-the-balance-sheet debt” that threatens to starve services such as police protection, recreation centers, parks and libraries.

“The ability of local governments, particularly cities, to provide the levels of service they do now is threatened by this liability,” said Joshua Rauh, a Northwestern University business professor who co-authored the report with Robert Novy-Marx, a University of Rochester professor.

To recap… The G-7 meeting turned the currency disputes over to the IMF… Does that wrinkle anyone else’s forehead? The currencies are seeing some selling this morning, as the uncertainty of things leads to a “flight to safety” once again, with Japanese yen trading close to an 81-handle! The FOMC meeting minutes print this afternoon, and should put all those nonsensical thoughts about no QE to bed. And the president could call out China as a currency manipulator this week…

http://dailyreckoning.com/g-7-squashes-currency-rally/

Brian Pretti and Jim Puplava talk about the coming quantitative easing, and how to hedge a portfolio for both deflation and inflation risk.

http://www.financialsense.com/financial-sense-newshour/guest-expert/2010...

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Re: Is the currency game almost over?

 I watched an interesting video with Max Kaiser saying "they" are going to bring the US economy down. He seems a little strung out but this is on topic so I thought I would share. I have watched this twice and still have no idea what "they" can or are going to do. According to him the US currency game is up.  http://vinceseconomicblog.wordpress.com/2010/10/12/max-keiser-they-are-going-to-take-the-u-s-economy-down-the-alex-jones-channel/

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Re: Is the currency game almost over?

Well Max really put it on the line there!  A prediction for something to happen tomorrow is pretty short confirmation or denial time....

just what would this look like back here if he were right??

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Re: Is the currency game almost over?
goes211 wrote:

I am afraid I must agree with silvervarg.  That is great rhetoric but horrible policy!

Can you imagine a greater injustice than every fool that bought a Mc Mansion, two BMW's, a boat, and a summer home with 2% down on credit getting to keep their stuff, while the smart working stiff that did not live above their means and has nearly paid off their modest home, gets nothing.  Actually it would be worse than nothing because suddenly their measly savings would never have a chance of buying any of the stuff the fool's own outright.

Well obviously, there would be more to it than just cacelling the debts........

I wouldn't worry too much about those with BMWs and boats....  they won't have fuel for them soon.

Some sort of intervention to spread the wealth around will be necessary...  no one needs to "own" more than one house anyway.

I know it all sounds like communism, but trust me....  the next twenty years will be nothing like the last!  Change is coming.  You're basing your objections on the assumption that things will remain the same only different......

Mike

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Re: Is the currency game almost over?

 I had dinner with some IMF wonks at Old Ebbit Grill next to the Treasury on Sunday evening, and found out that the end of the dollar was discussed at their meeting.

 I'm not at liberty to say much more than that, other than to warn anyone that thinks the dollar is going to survive this mess.....is wrong.   And "yes", Bancor is the name they were throwing around.....not SDR.  

I can also tell you, I had a 14oz Ribeye ala Pittsburgh (5 second searing on each side) that was outstanding!  Grossed the only female that was in the private dining area (She works for the World Bank)!  It was quite funny! 

land2341 wrote:

Well Max really put it on the line there!  A prediction for something to happen tomorrow is pretty short confirmation or denial time....

just what would this look like back here if he were right??

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Re: Is the currency game almost over?
LogansRun wrote:

 I had dinner with some IMF wonks at Old Ebbit Grill next to the Treasury on Sunday evening, and found out that the end of the dollar was discussed at their meeting.

 I'm not at liberty to say much more than that, other than to warn anyone that thinks the dollar is going to survive this mess.....is wrong.   And "yes", Bancor is the name they were throwing around.....not SDR.  {...}

Well, there's that but perhaps you can't rule out that Bancor was being used as euphemism for SDR. 

See:  http://en.wikipedia.org/wiki/Bancor

It the actual mechanics of how this Xcurrency is what interests me (backed by AU or not).  Interesting times....

Regards, Joanne.

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Re: Is the currency game almost over?

Ps- Great read Machinehead.  Keep it comin'. 

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Re: Is the currency game almost over?

As long as WallStreet finds a fool to believe its hype, the game will continue.

This is all just trade-hype, always has been, always will be. Don't fall for it again, your just making money for the 'house'. 

Sorry for the bluntness, 

Jeff

(PS: That was a damn good post MH: you almost pulled me over to the dark side FrownSurprisedLaughing)

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Re: Is the currency game almost over?

I Wiki-ed this Bancor info and just wanted to add it to the conversation.

Thanks Logan

 

Bancor is the name of the supranational currency that John Maynard Keynes was conceptualising in the years 1940-42 and which the United Kingdom proposed to introduce after the Second World War. This newly created supranational currency should then be used in international trade as a unit of account within a multilateral barter clearing system – the International Clearing Union –, which would also have to be newly found. The Bancor was to be backed by barter and its value expressed in weight of gold. However, this British proposal of introducing a supranational currency could not prevail against the interests of the United States, which then at the Bretton Woods conference established the U.S. dollars as world key currency.

Since the outbreak of the financial crisis in 2008 Keynes' proposal is winning in importance: In a speech delivered in March 2009 entitled Reform the International Monetary System, Zhou Xiaochuan, the governor of the People's Bank of China called Keynes' bancor approach "farsighted" and proposed the adoption of IMF SDRs as a global reserve currency as a response to the financial crisis of 2007–2010. He argued that a national currency was unsuitable as a global reserve currency because of the Triffin dilemma - the difficulty faced by reserve currency issuers in trying to simultaneously achieve their domestic monetary policy goals and meet other countries' demand for reserve currency.[1][2] A similar analysis can be found in the Report of the United Nation's "Experts on reforms of the international monetary and financial system" [3] as well as in the IMF's study published on April 13, 2010 [1][4]

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Re: Is the currency game almost over?

 This site provides a fuzzy idea of what the power elite think of this issue and others. The  hard-a**ed realities are euphemized and sanitized for the delicate sensibilities of the refined gangster class, so you have to read between the lines for actual insight.

Council Foreign Relations:

http://www.cfr.org/publication/editorial_detail.html?id=2222

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Re: Is the currency game almost over?

Six weeks ago in an essay titled 'Defeating Demon Deflation,' I advocated that QE II be directed toward purchases of international reserves, such as Treasury obligations of Asian nations. Although the US chose not to take the advice, currency wars have become a 'front burner' topic since then, as agitating prop's CFR link illustrates. Here's the 'Demon Deflation' post for those who missed it:

http://www.zerohedge.com/article/guest-postdefeating-demon-deflation

Also since then, the Fedsters have been nattering and mumbling about various stimulus options, such as announcing an inflation rate target, a price level target, or even a nominal GDP target. One reason the economy feels so stagnant is that nominal GDP growth (including inflation) is at the lowest level in decades. Currently it's at a dismal +3.9%, whereas 6% nominal growth used to be considered 'dead in the water' (and probably would be the Fed's minimum target if they set one).

What's bothering me today is whether all of the chatter about 'too low inflation' and 'too weak growth' is all a smokescreen for a more acute crisis -- namely, Foreclosuregate. Last Friday, Obama vetoed the first bill in his presidential career -- HR 3808, passed unanimously by both houses of Congress, which would have legalized interstate notarizations in foreclosure actions.

The reason for Obama's veto is now emerging. There appears to be a huge documentation problem with nearly all of the securitized mortgages since the bubble started six or seven years ago. The physical paperwork was not being properly endorsed and passed along to the custodians and security trustees. In the worst case, this could invalidate many of these trusts, making them legally nonexistent, and with no right to foreclose. It also affects title insurance, as title insurers don't want to be on the hook if mortgage documentation is defective.

Even if a political fix is found for this monumental screw-up, the delay alone could take down some big banks. My sense is that this is a HUGE issue, which forced Obama's hand on a bill which would have made fraudulent 'robosigning' even easier. It's a populist issue par excellence, with echoes of the 1930s as some call for a nationwide foreclosure moratorium (which some states implemented in the mid 1930s). I have never seen angrier comments on blogs and forums than about the foreclosure fraud issue -- the bourgeoisie sounds ready to start torching cars and heaving bricks through shop windows.

Karl Denninger is one of the more rabid commentators on the issue:

http://market-ticker.org/akcs-www?post=168960

In the worst case, we're talking about a repeat of the 'Lehman weekend' in late 2008. Naturally, the Fed would not want to provoke a crisis. Their instinct would be to preëmptively flood the market with liquidity on a diversionary pretext. And that may be exactly what's happening.

- Gold (printing another record high today);
- Treasury yields (hovering near record lows on the short end);
- The dollar (hovering near 2010 lows); and
- Commodities (smoking higher, less than 10% below their mid-2008 record high);

are the stress indexes to watch.

Banzai Ben Bernanke is spiking the Fed's proverbial punchbowl with Grateful Dead blotter acid instead of vodka this time. Now he's idly twirling a daisy between his fingers, with pupils the size of saucers, humming 'Magical Mystery Tour.' But I'm hearing a different tune:

I tripped on a cloud and fell eight miles high
I tore my mind on a jagged sky
I just dropped in
To see what condition your condition is in

Freaked out, I reckon! This could get seriously weird. As Jimi might have said, 'Hey, you cats up there in the Eccles Building! Y'all can't fly -- just remember that!

Laughing Surprised

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Re: Is the currency game almost over?

Is the great reset drawing nearer?  Martin Wolf, the FT's chief economics commentator seems to have lost the plot completely in his last two weekly columns offering  wildly misguided prescriptions for facing down the dastardly Chinese.  Last week he suggested preventing Chinese purchases of US Treasuries!!?? This week's column is entitled "Why America is Going to Win the Global Currency Battle".   Well, that's reassuring, isn't it.

It may be wishful thinking on my part but the great and the good, our betters, our rulers seem to have become a little unhinged lately.  It is hard not sense that events are unfolding more and more quickly.  Not so much interesting times as surreal times. 

Writes Ambrose Evans

And while the French deny that they are in talks with China over the creation of a new currency regime, I heard French finance minister Christine Lagarde say in person at a meeting in Italy that France would use its G20 presidency to push for an alternative to the dollar. She specifically cited the “Bancor”, the idea floated by Keynes in the 1940s for a commodity currency priced off a basket of metals. The US risks gambling away the “exorbitant privilege” it has enjoyed for two thirds of a century as currency hegemon.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/805406...

Writes Jim Rickards in an evisceration of Edwin Truman's extraordinary (to be kind) op-ed in the 10/12/10 edition of the FT (http://www.ft.com/cms/s/0/2bbd4dbe-d5fe-11df-94dc-00144feabdc0.html)

Ted Truman is not a fringe figure or a minor intellectual; he is a giant in the field.  He is not just close to the establishment.  He is the establishment.  An op-ed by Truman appearing one day after the IMF semi-annual meeting ended with no effective solutions on the currency wars is no coincidence.  It is a metaphorical Message..., to the gold insurgents, from the President and the powers that be.  It is price suppression without having to engage in actual sales.  It is a warning to gold bugs that they may get crushed.  It is meant to induce fear into those newly interested in gold that it’s a rough game with no holds barred.  It is a show of bravado by the fiat money crowd.  But it is also a sign of desperation; the last gasp of the ancien régime of fiat money.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/10/13_J...

Meanwhile, gold, oil and grains continue to rise.

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Re: Is the currency game almost over?

M-Head....again well said.  Kudos to you. 

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Re: Is the currency game almost over?

P.S. Zero Hedge's  typically caustic takedown of above-referenced article by Edwin Truman on gold can be found here:

http://www.zerohedge.com/article/yale-phd-and-former-fed-member-tells-ob...

 

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Re: Is the currency game almost over?

They weren't using it as a euphemism, but thank you.  As I said, I can't really go into detail as many old timers know my status.  But I'll add what I've said before quite a few months back..........the Fed is going to be sacrificed in a move to bring about the Bancor in the near future.  The moves that are being taken at this time, by all the Central Banks in the Western World, are deliberately designed to increase the pressure on the States Finances.  When it starts to collapse, the bankers are planning to bring their savior to the fore........May I introduce the One World Currency!  Yeah!!!!!!!!! YellMoney mouthCry

There's SOOOO much that's taking place behind the scene's that I can't discuss but...............I'll guarantee this is what's going to happen.  It's whether the American Citizen is awoken before they try to implement the fraud!  

BTW:  There's a reason I bought a $750k/105ft, 3 masted ship, and over $1.5m on a family commune in Madagascar!  And "no", I'm not nuts.  I just KNOW what's coming~!

 

mobius wrote:
LogansRun wrote:

 I had dinner with some IMF wonks at Old Ebbit Grill next to the Treasury on Sunday evening, and found out that the end of the dollar was discussed at their meeting.

 I'm not at liberty to say much more than that, other than to warn anyone that thinks the dollar is going to survive this mess.....is wrong.   And "yes", Bancor is the name they were throwing around.....not SDR.  {...}

Well, there's that but perhaps you can't rule out that Bancor was being used as euphemism for SDR. 

See:  http://en.wikipedia.org/wiki/Bancor

It the actual mechanics of how this Xcurrency is what interests me (backed by AU or not).  Interesting times....

Regards, Joanne.

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Re: Is the currency game almost over?

OK Logan walk the stupid civilian through this.

Not giving anything up,  just what would the "collapse" you reference look like??   What will be the harbinger of the "change over"?  

And how badly will the BOHICA be this time??

And just what would the sheeple be able to do if this should start short of bloody revolution? - which ain't happening.

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Re: Is the currency game almost over?

http://goldnews.bullionvault.com/gold_prices_101320105

Gold Price Nears Dollar & Sterling Highs as Egypt & India Enter the "Global Currency War" Denied by US 

13th October 2010

Gold Prices stalled $3 shy of last week's all-time record against the Dollar in London trade Wednesday morning, peaking above $1361 an ounce as the US currency fell and global stock markets rose sharply.

Gold priced in Sterling rose to a fresh 4-month high, some 1.3% shy of June's record peak of £870 per ounce.

Eurozone investors wanting to Buy Gold saw it hold in the upper-end of its last 9 weeks range at €31,300 per kilo.

Over in Asia, Tuesday's lack of Indian and Chinese demand was reversed today, wholesale dealers said, with speculative buying noted on the electronic Globex platform after new data from Beijing showed China's crude oil imports rising 35% last month from Sept. 2009, hitting a new record of 5.67 million barrels per day.

US crude oil futures jumped back towards $83 per barrel, as European equity markets added well over 1%.

Trading-room rumors meantime said Egypt has become at least the 14th central bank to start selling its own currency in a bid to depress its value on the forex market.

"If the inflows are lumpy and volatile, or if they disrupt the macroeconomic situation, we will [also] intervene," said Reserve Bank of India chief Duvvuri Subbarao this morning.

US Treasury secretary Tim Geithner said Tuesday he sees "No risk" of a global currency war – the term used last month by the Brazilian finance minister to describe the rash of naked interventions in the forex market by central banks worldwide.

In the last fortnight alone, believes Simon Derrick at Bank of New York Mellon, purchases of US Dollars by South Korea, Malaysia, Indonesia, Thailand and Taiwan have seen them accumulate foreign exchange reserves at up to six times their previous pace, collectively buying $28.74 billion according to IFR Markets.

"Despite this, the South Korean Won has climbed 5.7% against the Dollar since the start of September," the Financial Times notes, "while the Malaysian Ringgit has gained 1.3% and the Thai Baht 4.3%.

"China has allowed the Renminbi to rise by 2% against the Dollar since the beginning of last month."

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Re: Is the currency game almost over?

I honestly don't know how or what the social ramifications will be.  It's obviously scary as hell for all.  This country is armed to the teeth, with people willing to use them so......

My feelings on this are that the gov't is going to have to come up with a bogey man in order to shut down the internet.  At which time, a disarmament of the population will take place, as much as possible at least.  Without the internet and only the media to report what's taking place, the gov't would be able to go through each community and disarm as much as possible.  You nor I would ever hear that it was happening, or we'd hear rumblings but not the whole story.  

And/Or

As for the collapse of the dollar.......I'm pretty sure that we're going to have a series of collapses that will coincide with issues of sovereign debt in Europe.  As these take place, the same will become apparent in the US and the bankers will bring their solution to the front.  That solution will be the One World Currency.  At that time, debts will be held off via the exchange to the new currency.  It really is a very basic concept, and one that the world will actually scream for instead of fight against.   I honestly CAN'T go into details.....sorry!

Now, as far as I know, the Chinese haven't bought into this as of yet.  They're the ones that will have to do so, and exchange debt from one currency (dollars) to the new currency.  OPEC IMO has already done so with the agreement that they will be a part of the new system.  One thing that I've heard is that the OPEC countries are not in the position to bargain as well as they thought they were due to the presence of NATO.  It actually kind of nipped them in the ass.  They thought they were going to get more reparations out of the Iraq issue than what they actually did AND, they now have a HUGE NATO presence at their doorstep.  

Back to the dollar and "Bancor"....... With a one world currency, you must have a police force of some type to keep things in line.  This is where Interpol comes into play.  

Again, I don't know what's really going to happen in regards to the social structure of the US.  I wish I did.  I know it's quite a conundrum for tptb as well!  Their two major fears in this mess are:  The American Public and the Chinese (with India being in there as well).

This was sent to me by a member of the CFR back in late May.  It may shed some light on what the CFR is thinking via the world banking system.

Global Economic Governance: Progress and Prospects in the G20, International Monetary Fund, and World Bank 

Video:

http://www.cfr.org/publication/22174/global_economic_governance.html

http://www.cfr.org/publication/22191/panel_i.html

STEWART PATRICK: Good morning, ladies and gentlemen. I'm Stewart Patrick, senior fellow here and director of the Program on International Institutions and Global Governance. On behalf of council president, Richard Haass, I'd like to welcome to you to our second annual symposium.

Before we begin, could I, as usual, ask everyone to turn off any cell phone they may have and other electronic equipment since it tends to interfere with recording and audio that we have here. I also want to remind everyone that, unlike many council events, this meeting is on the record. So your remarks will be recorded for posterity.

Allow me a few words -- moments to place this event into wider context and to offer some much-deserved thanks. The IGG program is the council's largest single initiative. In fact, it's one of the largest initiatives in the council's history.

We launched it because we saw a world that was being transformed by new issues, by new actors and by new powers. But our global institutions we believed were failing to keep up in confronting the world's most daunting challenges. What we try to do in our program is to identify gaps in current institutions, to propose pragmatic reforms for trying to fill those gaps, and then to engage policymakers in making necessary changes to deal with those gaps that we've identified.

The IGG program is made possible by a very generous grant from the Robina Foundation. This is the lasting legacy of James Binger, who died in 2004 and was a noted philanthropist and a long-time Council on Foreign Relations member.

Over the past two years, we've involved more than 20 of the council's fellows in the activities of the IGG program. And this has included producing dozens of reports on priorities for institutional reform, and you'll find several of those on the table outside.

We've also created something that we hope you'll check out that's online, which is a wonderful resource, a multimedia resource called the Global Governance Monitor, which tries to track and evaluate efforts in multilateral cooperation across a wide range of different issue areas, ranging from climate change to global financial instability, to nuclear nonproliferation and coming up on global health. We're deeply grateful to the Robina Foundation for making all of this possible.

A few words about today's symposium. In the 21st century, prospects for effective multilateral cooperation in confronting the world's most daunting challenges are going to depend first and foremost on the interests and world-order visions of the world's most important powers. But the identity and number of those players is changing, creating new challenges and opportunities for cooperation.

The United States obviously has a powerful interest in integrating these countries into a rule-bound system of international relations. The good news today is that none of the major emerging powers are revolutionary in the sense of trying to overturn the existing order.

But each of these countries is at least moderately revisionist. All hope to adjust the structures and norms governing global security and economic relations to suit their preferences. The order that ultimately results from all of this is going to be the product of tough bargaining and negotiation between established powers like the United States, the European Union and Japan, and the rising pillars of world order, including China, India and Brazil, as well as a number of emerging middle powers.

To better understand the visions and priorities of global institutional reform that these countries have in mind, we've been holding an international meeting series. We've had a workshop in Rio de Janeiro and another in Beijing and we'll be holding another one in New Delhi.

One of the things that we've learned from these meetings is that today's ascending powers have -- are deeply ambivalent about their global roles. They want to be at the high table, they want to alter the rules of the game and they want more say in global governance structures. But they're also -- as self-defined developing countries, they're leery of assuming additional burdens and obligations of power, and particularly leery of picking up the check and providing global public goods.

Our two panels this morning are going to begin to look at how some of these dynamics are playing out in global economic and security relations, and what the implications of these trends are for multilateral cooperation and global institutional reform.

Our first panel looks at the global economic and financial system in the wake of the meltdown that began in late 2008. We've obviously already seen some adjustment here with the creation of the G-20 announced in Pittsburgh by Obama, which President Obama announced in Pittsburgh would henceforth be the premier forum for global economic coordination. We've also seen the creation of something called the Financial Stability Board. And next month, both the G-20 and the G-8 will be meeting in Canada.

So far, the G-20 has shown impressive cohesion in dealing with the global economic crisis. But will this cohesion persist as the world moves out of crisis? Will established and emerging powers address long-standing imbalances in the global economy? Do they have the same vision for the G-20 and its relationship to the G-8? Will they agree to adjust the governance structures of the World Bank and the International Monetary Fund, and are they committed to reviving a more abundant trade agenda?

The second panel this morning addresses the role of rising powers in arresting the specter of nuclear proliferation and potential someday nuclear use. As we speak, U.N. member states are gathered for the NPT review conference in New York where they're engaged and struggling really to preserve a fraying nuclear nonproliferation regime as new states pursue nuclear weapons, as nuclear technology spreads and as disarmament pledges go unfulfilled.

The choices that today's rising powers will make will play a critical role in whether or not this regime actually survives. This is particularly true of nuclear-armed India, which remains outside the regime and in a somewhat anomalous position. But it's also true of Brazil, which has spent obviously the last week flexing its muscles in nuclear diplomacy, much to the consternation of Washington.

Can established and rising powers forge new bargains to contain these threats and bring all nations within the regime? Can they reach agreement on the often competing goals of nonproliferation, disarmament, peaceful access and peaceful access to nuclear energy?

To close the conference, we're honored to have as our keynote speaker Deputy Secretary of State James Steinberg. He'll describe the Obama's administration's attitude towards engaging rising powers as part of what it describes as its multi-partner world.

Five years ago, as you all know, his predecessor articulated one possible approach to this question with respect to China, suggesting that the world was looking to China to become, quote unquote, "a responsible stakeholder."

As the intervening years have suggested, articulating the concept of responsible stakeholder is a little bit easier than putting it into practice. There's an ongoing debate around the world about who gets to define what the meaning of "responsible" is and also about the balances between privileges and responsibilities that are inherent in stakeholder status.

land2341 wrote:

OK Logan walk the stupid civilian through this.

Not giving anything up,  just what would the "collapse" you reference look like??   What will be the harbinger of the "change over"?  

And how badly will the BOHICA be this time??

And just what would the sheeple be able to do if this should start short of bloody revolution? - which ain't happening.

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JAG
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No Sanctuary

LR, you should know better, Madagascar is no Sanctuary Laughing

Your going to have to face judgment day like the rest of us....mwu...hahaha

Sorry buddy, I couldn't resist....Jeff

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Re: Is the currency game almost over?
LogansRun wrote:

My feelings on this are that the gov't is going to have to come up with a bogey man in order to shut down the internet.  At which time, a disarmament of the population will take place, as much as possible at least.  Without the internet and only the media to report what's taking place, the gov't would be able to go through each community and disarm as much as possible.  You nor I would ever hear that it was happening, or we'd hear rumblings but not the whole story.  

Sorry if this is going a bit off-topic, but is anything being done on a grass-roots level to create a peer-to-peer wifi-based Internet that would link up individual personal computers that did rely on the main backbone, so people could continue to have an "Internet" even if the government tried to turn off the big pipes?

And as far as one world currency goes...are there any plans to ease the transition via something like the "Amero" (for all of North America) or will we be going straight from the dollar to the "World-O" or whatever they'll call it?

I'm expecting something to replace the dollar...because they are trashing its value. I just hope the transition is smoother than what you are suggesting. Bringing about the Euro did not cause any bloodshed. I'd like it to be more like that, if it has to be done.

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LogansRun
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Re: Is the currency game almost over?
soulsurfersteph wrote:
LogansRun wrote:

My feelings on this are that the gov't is going to have to come up with a bogey man in order to shut down the internet.  At which time, a disarmament of the population will take place, as much as possible at least.  Without the internet and only the media to report what's taking place, the gov't would be able to go through each community and disarm as much as possible.  You nor I would ever hear that it was happening, or we'd hear rumblings but not the whole story.  

Sorry if this is going a bit off-topic, but is anything being done on a grass-roots level to create a peer-to-peer wifi-based Internet that would link up individual personal computers that did rely on the main backbone, so people could continue to have an "Internet" even if the government tried to turn off the big pipes?

I don't know about this one.  It would be nice, but how many people would actually have access?  Sort of like short wave radio use.

And as far as one world currency goes...are there any plans to ease the transition via something like the "Amero" (for all of North America) or will we be going straight from the dollar to the "World-O" or whatever they'll call it?

I'm not getting the feeling that there's a secondary currency for N. America first, but that doesn't mean it's not in the works.  All Western Countries are in the same boat, debt wise.  So as they all debase, institute austerity measures, etc...they should all hit the point of no return approx. the same time.  

My greatest concern is that they'll bring about a large scale war, to finish the bankrupting of the nations, AND create chaos in order to bring the solution about.  This is an area that I can't discuss much though so...

I'm expecting something to replace the dollar...because they are trashing its value. I just hope the transition is smoother than what you are suggesting. Bringing about the Euro did not cause any bloodshed. I'd like it to be more like that, if it has to be done.

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Re: Is the currency game almost over?

LR - any suggested timelines, whether rough or not?

 

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Re: Is the currency game almost over?

I'm getting the impression it's still some time away.  There's been ups and downs over the past 1.5 years that sometimes get me worried, then it just goes quiet.  The Iran issue is still on the burner, so it could be used as a tipping point.  But as I've said before, it's going to be an Israeli attack, with the US being secondary.  At least that's what I've gathered.  An issue  I'm really not able to discuss is Pakistan.  Be aware of what's taking place there.  They seem to be the flashpoint along with Iran at this time.  As we all know, Pakistan has nukes.

Also, in my meeting with the Dyncorp's ex-chairperson, the discussion of their preparation for chemical/biological threats in the US is very high.  I cannot go further into that at all.  

So there you have 3 possible chaos creating issues that could be used to enhance control after the tipping of the economy.  IMO, when war drums start beating loudly, we'll know the economic tsunami is coming as well.  

I have a lunch set up next week in Georgetown with a ex colleague from Stratfor Global Intelligence, as well as a ranking official from the State Dept.  I'm sure I'll have something then.  I'll give as much detail as possible, but as most know, I'm not at liberty any longer to go into TOO MUCH detail.

For those that aren't familiar with Stratfor GI, I suggest you take a look.  

http://www.stratfor.com/ 

I can't post their 3rd or 4th Quarter Forecast without their permission, but if you put your email address into their system, they'll email the 4th Qtr Forecast for free.  You only get one for free so......

Cheers!

 

jumblies wrote:

LR - any suggested timelines, whether rough or not?

 

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