When central banks can print no more, money will be trapped
by Adam Taggart
Sunday, November 6, 2016, 5:50 PM
Sunday, November 6, 2016, 5:50 PM
Friday, July 3, 2015, 4:19 PM
Wednesday, May 20, 2015, 1:43 PM
No one could have predicted the sheer scope of global monetary policy bolstering the private banking and trading system. Yet, here we were – ensconced in the seventh year of capital markets being buoyed by coordinated government and central bank strategies. It’s Keynesianism for Wall Street.
The unprecedented nature of this international effort has provided an illusion of stability, albeit reliant on artificial stimulus to the private sector in the form of cheap money, tempered currency rates (except the dollar – so far) and multi-trillion dollar bond buying programs. It is the most expensive, blatant aid for major financial players ever conceived and executed. But the facade is fading. Even those sustaining this madness, like the IMF, are issuing warnings about increasing volatility.
Sunday, April 13, 2014, 8:03 PM
James Rickards, financier and author of the excellent cautionary best-seller Currency Wars, has recently released a follow-on book: The Death of Money: The Coming Collapse of the International Monetary System. In it, Jim details how history provides plenty of precedent for the collapse that has begun amidst the major world currencies.
The historical progression is predictable enough that Jim is comfortable claiming that the next economic crisis we face will be bigger than the ability of the Federal Reserve (and the other world central banks) to contain it. And that such a calamity will happen within the next five years:
Saturday, September 21, 2013, 7:50 PM
Jim Rickards, author of the best-seller Currency Wars, sees the world's central banks embroiled in a "race to debase" their currencies in order to restore – at any cost – growth to their weakened economies.
In the midst of the fight, the U.S. Federal Reserve wields oversized power due to the dollar's unique position as the global reserve currency. As a result, actions by the Fed create huge percussive ripples across the battlefield, often influencing events in ways little understood by the players – and especially by the Fed itself.
In Rickards' words, the policymakers at the Fed "think they are dialing a thermostat up and down, but they're actually playing with a nuclear reactor – and they could melt the whole thing down":
Wednesday, April 17, 2013, 6:37 PM
Tuesday, April 16, 2013, 4:24 PM
Wednesday, March 27, 2013, 2:55 PM
Monday, March 18, 2013, 4:29 AM
This weekend on 3/16/13, under pressure from IMF bankers and a push from German politicians, a Cyprus bailout deal was approved that would take the bulk of the bailout fund from the private bank accounts of Cyprus bank depositors. Yes, you read that right; savers were determined to be the logical target to bail out the profligate.
The reaction from depositors, predictably, was intensely negative. They are furious and shocked.
This is a complete game-changer. It means that even money in the bank is not safe. It implies that money in pension and money market accounts is not safe, either. It means that rule of laws and contracts really don't matter. Of course, MF Global taught us that. It finally means that trust is no longer a part of the equation…
Tuesday, September 25, 2012, 4:45 AM
In Part I, we covered the background to what now appears to be inevitable: Germany has to leave the Eurozone. She, along with the Netherlands and Finland, simply cannot afford to bail out the rest of the Eurozone, so she is standing in the way of a resolution to the crisis. It is therefore only a matter of time before the political classes have to face this reality.
Time is running out, and the longer Germany delays, the worse her position will be. The yields on Spanish and Italian debt will inevitably head towards and through the 7% "point-of-no-return" threshold and beyond, and Germany will get all the blame. Germany will be seen as a thorn in the side of the ECB, restricting its scope for monetary action and obstructing a solution, partly because of the Bundesbank’s stubborn conservatism and partly because Germany’s Constitutional Court frowns on monetising government debt. She will be unfairly condemned by everyone.
Let’s look at some back-of-the-envelope figures…