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The financial uncertainty that we are in, in my humble belief, began as a means of conquering China. Or more, of forcing China to change a very dubious fiscal policy. A policy that was problematic to US, and even European, concerns. I do believe that the junk equities (?) traded concerning risky home loans, among many other practices, were calculated to change that policy at the very real threat of world wide financial ruin. Much like the old nuclear threat, this was a very serious showdown. Most people know nothing of it, most people who played a part do not and never will understand it, but that does not change the fact.
Does that mean the world, or even US economy will now simply smile, get up, and heal itself? Well, no. First, there will have to be a bending of what is considered public policy, both domestic and foreign affairs will need to be rearranged, and it will take time to get out the useful idiots and policies, and begin building and stabilizing the various economies and economic partnerships.
My evidence comes in two doses. And, no, Obama was not part of the planning, progress, or in what is about to take place. He was a useful idiot who has outlived his usefulness and will be plagued with failure after failure, except where his policy suggestions are considered useful. His social and political actions are not considered useful or important, no matter what he actually ends up doing (to the real power brokers).
The first piece of evidence, which goes completely against what Obama and the the rest of the yahoo freaks in Capital Hill are trying to do. "Advanced economies have committed to fiscal plans that will at least halve deficits by 2013 and stabilize or reduce government debt-to-GDP ratios by 2016," said the G20 Toronto Summit Declaration which was issued on Sunday. To put it bluntly, this means everything quota boy has done and everything he has planned to do has been shuffled into the circular file. Agreeing on targets means nothing to the Dunce in Chief, but when he cannot get legislation through, with strong (nearly absolute) majorities in the Senate and House, you know his "productive" days are over.
And, what precisely was the Chinese policy over which we went to global financial war regarding? It was China pegging their monetary value to ours. Whenever the dollar would go up, their currency would go up proportionally. Same with when it went down. The first move in that war, after they pegged their money to ours was a devaluation of the US greenback. I started suspecting that this was the case all along after watching some of the irregularities coming out of the Fed, big banking, lending practices, and some other actions and processes.
Now, what has changed? VC day, that is, Victory over China has finally occurred. I think that is why the G20 did what it did. The two are very close in time and, if you think just a bit, very related to one another. What this means, in the end, is anybody's guess. Though I think, over the course of months and years, the casualties of this war will be buried, the policies which were meant to stifle the economy and devalue the greenback will be... changed, and life will begin to get back to normal. Oh, here is that piece.
Anyway, on to the faucet. I really hope to have that done tonight. I should sleep a LOT better, and maybe wake up easier, having one less monkey on my back! Ugh.
Good night.
"And, what precisely was the Chinese policy over which we went to global financial war regarding? It was China pegging their monetary value to ours."
ReplyDeleteYes, I am sure I have mentioned this at least a couple of times, probably first a couple of years ago when I surmised that the mess we were heading into looked suspiciously like an effort to shake loose the Yuan peg, if it was deliberate at all.
OTOH this is a feeble victory for the amount of pain the country has suffered so far (and will continue to suffer for quite a while), given that they can repeg it anytime the situation is again in their favor to do so.
ReplyDeleteDespite the chaos in the Euro and in Euroland in general, or perhaps because of it, I still think the real push by the oligarchy is a global currency and global governing institutions to match, to make it more convenient for them to rule us.
The Euro and the EU were and are trial runs for the global version of the same. They note, no doubt, how well financial and political turmoil serves their ends and greases the skids of their agenda. Therefore we can certainly expect more of the same in the future.
Perhaps, at some point, a single currency was the thrust (thus, essentially, one government as all governances are tied to currency). However, one of two things happened. One, the trial balloon of the EU began to show weakness, the value of it as a control measure began to erode, and the show was canceled. OR... A competing interest with a different agenda and nearly equal or similar power vied against a united currency (thus government), and through the weakening of the EU, the global markets really, and other such, they gained predominance and beat out the competing (one currency, one government) paradigm.
ReplyDeleteAnd, I could see both happening at once... the war on China and the war for a single currency or not. However, I would even view these as related in an odd and twisting, yet and strangely straightforward manner.
The thing to note is that, like communism and socialism (really the same thing, just slightly different "skins"), when they are shown to have failed, that does not mean they simply die out and go away. No war, it seems, is every truly won or lost.
Still, I honestly think these episodes I described are signs of, potentially, the breaking of 'the fever'. I think this currency war is the main of it. And, yes, I think they really were willing to break the world to disparage the tic that was China (no matter how "big" it seems, it is merely a tic). That doesn't mean the patient is yet well, it doesn't mean something else could not attack the weakened patient, and it doesn't even mean that the disease won't still kill... I just think the worst of it, probably, is over. Recovery, however, if the other parasites and main diseases can be kept in check, is not only possible but probable.
When? Get a crystal ball (then lend it to the quota in chief, he seems a little shy of it and, well, lots of other things, ha!). Though I honestly think, if we can keep the obomonites in check, and we and the G20 do what is suggested... 3 to 5 years. Of course, before that happens, the Aztec calender runs out at which time we are all going to DIE! hahaha
Commercial real estate has yet to fully manifest the crash that is incipient, residential real estate is not yet done crashing. The broader economy will not recover until consumers feel prosperous again, and that will not happen as long as they continue to lose their houses in droves.
ReplyDeleteThere are analysts that make a strong case that the US is already in a debt trap and cannot possibly grow its way out of it. Hyperinflation or default are options, but highly disruptive and damaging for a long time after.
In addition there's no possibility that the Obamanites will back off their profligate spending plans, and very little chance the Republicans would take a serious red marker to any of them even if they did regain power.
And re the EU, I think they see it necessary to break the current stagnant form in order to usher in their more streamlined dictatorship that is on the drawing boards.
I sniff something similar to what you detect on the wind, but I do not trust it. Having Krugman come around to Vox's point of view is startling, and could potentially be taken as a contrarian sign of spring. But I think it's just another red herring, like the green shoots that the grasshoppers ate. It would be nice, but I am more wary than I used to be. I think Vox will be proven more right than wrong on this one.
Have you read his book, BTW?
No, but I do have the book. I bought it when he was doing his Amazon putsch (with full intentions of reading it, too, and commenting on Amazon when I have). It is "in the works", if too it can't be on the top of the list, at least until I find it. Still, it is in the queue and will be found before too long. Next week might be a good time to find and read it.
ReplyDeleteI must admit though, what others get done in a day often takes me a week. What others do in a week can take me much longer. Then again, sometimes I can do things quickly, in a quarter or a tenth of the time (reading the bible last summer, for example) if that is rare. My mind, to some degree, is... lost. It is getting better, but totally disabled is not something they hand out in cracker jack boxes or for less than pretty sure events.
Well, to work! I have many things to do for next week to be an off week... which my hand, actually, really needs (as do I).
More from Denninger via Vox. Neither are getting any rosier in their outlooks.
ReplyDeleteI have no doubt that, even if I am correct, the illness is not close to being over, other factors may add to the problem (mostly political and social detractions and attempts to use the economic as a means to chaos and revolt), or even that the patient will ever fully recover.
ReplyDeletePerhaps this is the death knell for the U.S., Europe, even Asia and the rest, as we have known things for decades if not centuries. This might even lead to nuclear war(s) of minor or major proportions.
And yet, unless this is The Time(tm), life will go on. Chaos is terrible, but usually kills itself, much like revolutions and the rest of the rot. Perhaps we will go so far back as to be nearly stone age (though I doubt that on the longer term, if only above it regionally). And, to be honest, our technology has outstripped our ability to adapt to it, in any case, so it is probably not a bad thing to dump some of it.
Perhaps in a short run of months to years, perhaps even a decade, life could get as bad as you suspect. Reasonably possible. My projection, however, is that the world's economy is not as random, by half, as what some people suspect. Maybe those in control are split on how to go forward though, or they have simply over-steered into unknown, unknowable, uncontrollable variables too. Like I said though, my suspicion is that 3 to 5 years will, all else being majority probable as I see things, seeing a new dawn in the world economy... almost sadly.
Business as usual, and again in the wrong direction (toward world governance) can only happen successfully (for the most part) in times of glut. Basically, the times we went through (artificial and fabricated as much of it was, as is the nature of much of wealth (and fame and power)). All the channels of man's want is based in illusion and needs the belief of men to go forth (stop believing in the dollar and it will die (enough people), or turn our backs on a star or starlet and they fade)).
That is my take, though I can see your grounds (from my ground) anyway. To be absolutely honest, I don't think our varied positions have anything to do with optimism or pessimism, they have to do with how close we decide to shave the shim which we both think is necessary to maintain a proper gap. One shaving is possible, the other is beyond the thickness of the shim so no shaving can fill the void.
Possibly, possibly... Oh, and my China currency war thing goes back... to when I was living with my lady friend I think, though after we were no longer engaged and near the end of even that... It's a fond pet.