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Paul Merrell

Trump's Infrastructure Boondoggle - 0 views

www.counterpunch.org/...umps-infrastructure-boondoggle

economy Trump infrastructure

shared by Paul Merrell on 19 Mar 17 - No Cached
  • Donald Trump’s $1 trillion infrastructure plan is not an infrastructure plan and it won’t put $1 trillion of fiscal stimulus into the economy. It’s basically a scheme for handing over public assets to private corporations that will extract maximum profits via user fees and tolls. Because the plan is essentially a boondoggle, it will not lift the economy out of the doldrums, increase activity or boost growth.  Quite the contrary. When the details of how the program is going to be implemented are announced,  public confidence in the Trump administration is going to wither and stock prices are going to plunge.   This scenario cannot be avoided because the penny-pinching conservatives in the House and Senate have already said that they won’t support any plan that is not “revenue neutral” which means that any real $1 trillion spending package is a dead letter.  Thus, it’s only a matter of time before the Trump’s plan is exposed as a fraud and the sh** hits the fan.
  • Here are more of the details from an article at Slate: “Under Trump’s plan…the federal government would offer tax credits to private investors interested in funding large infrastructure projects, who would put down some of their own money up front, then borrow the rest on the private bond markets. They would eventually earn their profits on the back end from usage fees, such as highway and bridge tolls (if they built a highway or bridge) or higher water rates (if they fixed up some water mains). So instead of paying for their new roads at tax time, Americans would pay for them during their daily commute. And of course, all these private developers would earn a nice return at the end of the day.” (“Donald Trump’s Plan to Privatize America’s Roads and Bridges”, Slate) Normally, fiscal stimulus is financed by increasing the budget deficits, but Maestro Trump has something else up his sleeve.  He wants the big construction companies and private equity firms to stump up the seed money and start the work with the understanding that they’ll be able to impose user fees and tolls on roads and bridges when the work is completed.  For every dollar that corporations spend on rebuilding US infrastructure, they’ll get a dollar back via tax credits, which means that they’ll end up controlling valuable, revenue-generating assets for nothing. The whole thing is a flagrant ripoff that stinks to high heaven.   The corporations rake in hefty profits on sweetheart deals, while the American people get bupkis. Welcome to Trumpworld.  Here’s more background from Trump’s campaign website:
  • “American Energy and  Infrastructure Act Leverages public-private partnerships, and private investments through tax incentives, to spur $1 trillion in infrastructure investment over ten years. It is revenue neutral.” (Donald Trump’s Contract with the American Voter”) In practical terms, ‘revenue neutral’ means that every dollar of new spending has to be matched by cuts to other government programs.  So, if there are hidden costs to Trump’s plan, then they’ll have to be paid for by slashing funds for Medicare, Medicaid, Social Security, food stamps etc. But, keep in mind, these other programs are much more effective sources of stimulus since the money goes directly to the people who spend it immediately and help grow the economy. Trump’s infrastructure plan doesn’t work like that. A lot of the money will go towards management fees and operational costs leaving fewer dollars to trickle down to low-paid construction workers whose personal consumption drives the economy. Less money for workers means less spending, less activity and weaker growth.
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  • Here’s more on the topic from the Washington Post: “Trump’s plan is not really an infrastructure plan. It’s a tax-cut plan for utility-industry and construction-sector investors, and a massive corporate welfare plan for contractors. The Trump plan doesn’t directly fund new roads, bridges, water systems or airports…. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. … There’s no requirement that the tax breaks be used for … expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects… Second, as a result of the above, Trump’s plan isn’t really a jobs plan, either. Because the plan subsidizes investors, not projects; because it funds tax breaks, not bridges; because there’s no requirement that the projects be otherwise unfunded, there is simply no guarantee that the plan will produce any net new hiring. … Buried inside the plan will be provisions to weaken prevailing wage protections on construction projects, undermining unions and ultimately eroding workers’ earnings. Environmental rules are almost certain to be gutted in the name of accelerating projects.” (Trump’s big infrastructure plan? It’s a trap. Washington Post) Let’s summarize:  “Trump’s plan” is “massive corporate welfare plan for contractors” and the “tax breaks”…”could all go just to fatten the pockets of investors in previously planned projects.”
  • What part of this plan looks like it will have a positive impact on the economy? None. If Trump was serious about raising GDP to 4 percent, (another one of his promises) he’d increase Social Security payments, beef up the food stamps program, or hire more government workers.  Any one of these would trigger an immediate uptick in activity spurring more growth and a stronger economy.  And while America’s ramshackle bridges and roads may be in dire need of a facelift,  infrastructure is actually a poor way to inject fiscal stimulus which can be more easily distributed  by simply hiring government agents to stand on streetcorners and hand out 100 dollar bills to passersby. That might not fill the pothole-strewn streets in downtown Duluth, but it would sure as hell would light a fire under GDP. So what’s the gameplan here? What’s Trump really up to? If his infrastructure plan isn’t going to work, then what’s the real objective? The objective is to allow wealthy corporations to buy public assets at firesale prices so they can turn them into profit-generating enterprises. That’s it in a nutshell. That’s why the emphasis is on “unconventional financing programs”, “public-private partnerships”, and “Build America Bonds” instead of plain-old fiscal stimulus, jobs programs and deficit spending. Trump is signaling to his pirate friends in Corporate America that he’ll use his power as executive to find new outlets for profitable investment so they have some place to stick their mountain of money. Of course, none of this has anything to do with rebuilding America’s dilapidated infrastructure or even revving up GDP. That’s just public relations bunkum. What’s really going on is a massive looting operation organized and executed under the watchful eye of Donald Trump, Robber Baron-in-Chief.
  • And Infrastructure is just the tip of the iceberg. Once these kleptomaniacs hit their stride, they’re going to cut through Washington like locusts through a corn field. Bet on it.
  • Paul Merrell on 19 Mar 17
     
    Mike Whitney always tells it like it is.
Paul Merrell

Profiting from Your Thirst as Global Elite Rush to Control Water Worldwide :: The Marke... - 0 views

www.marketoracle.co.uk/article38167.html

banksters water water-rush privatization

shared by Paul Merrell on 23 May 14 - No Cached
  • A disturbing trend in the water sector is accelerating worldwide. The new “water barons” --- the Wall Street banks and elitist multibillionaires --- are buying up water all over the world at unprecedented pace. Familiar mega-banks and investing powerhouses such as Goldman Sachs, JP Morgan Chase, Citigroup, UBS, Deutsche Bank, Credit Suisse, Macquarie Bank, Barclays Bank, the Blackstone Group, Allianz, and HSBC Bank, among others, are consolidating their control over water. Wealthy tycoons such as T. Boone Pickens, former President George H.W. Bush and his family, Hong Kong’s Li Ka-shing, Philippines’ Manuel V. Pangilinan and other Filipino billionaires, and others are also buying thousands of acres of land with aquifers, lakes, water rights, water utilities, and shares in water engineering and technology companies all over the world. The second disturbing trend is that while the new water barons are buying up water all over the world, governments are moving fast to limit citizens’ ability to become water self-sufficient (as evidenced by the well-publicized Gary Harrington’s case in Oregon, in which the state criminalized the collection of rainwater in three ponds located on his private land, by convicting him on nine counts and sentencing him for 30 days in jail). Let’s put this criminalization in perspective:
  • Billionaire T. Boone Pickens owned more water rights than any other individuals in America, with rights over enough of the Ogallala Aquifer to drain approximately 200,000 acre-feet (or 65 billion gallons of water) a year. But ordinary citizen Gary Harrington cannot collect rainwater runoff on 170 acres of his private land. It’s a strange New World Order in which multibillionaires and elitist banks can own aquifers and lakes, but ordinary citizens cannot even collect rainwater and snow runoff in their own backyards and private lands.
  • In 2008, Goldman Sachs called water “the petroleum for the next century” and those investors who know how to play the infrastructure boom will reap huge rewards, during its annual “Top Five Risks” conference. Water is a U.S.$425 billion industry, and a calamitous water shortage could be a more serious threat to humanity in the 21st century than food and energy shortages, according to Goldman Sachs’s conference panel. Goldman Sachs has convened numerous conferences and also published lengthy, insightful analyses of water and other critical sectors (food, energy). Goldman Sachs is positioning itself to gobble up water utilities, water engineering companies, and water resources worldwide. Since 2006, Goldman Sachs has become one of the largest infrastructure investment fund managers and has amassed a $10 billion capital for infrastructure, including water.
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  • Citigroup’s top economist Willem Buitler said in 2011 that the water market will soon be hotter the oil market (for example, see this and this): “Water as an asset class will, in my view, become eventually the single most important physical-commodity based asset class, dwarfing oil, copper, agricultural commodities and precious metals.” In its recent 2012 Water Investment Conference, Citigroup has identified top 10 trends in the water sector, as follows:
  • Specifically, a lucrative opportunity in water is in hydraulic fracturing (or fracking), as it generates massive demand for water and water services. Each oil well developed requires 3 to 5 million gallons of water, and 80% of this water cannot be reused because it’s three to 10 times saltier than seawater. Citigroup recommends water-rights owners sell water to fracking companies instead of to farmers because water for fracking can be sold for as much as $3,000 per acre-foot instead of only $50 per acre/foot to farmers.
  • One of the world’s largest banks, JPMorgan Chase has aggressively pursued water and infrastructure worldwide. In October 2007, it beat out rivals Morgan Stanley and Goldman Sachs to buy U.K.’s water utility Southern Water with partners Swiss-based UBS and Australia’s Challenger Infrastructure Fund. This banking empire is controlled by the Rockefeller family; the family patriarch David Rockefeller is a member of the elite and secretive Bilderberg Group, Council on Foreign Relations, and Trilateral Commission.
  • Barclays PLC is a U.K.-based major global financial services provider operating in all over the world with roots in London since 1690; it operates through its subsidiary Barclays Bank PLC and its investment bank called Barclays Capital. Barclays Bank’s unit Barclays Global Investors manages an exchange-traded fund (ETF) called iShares S&P Global Water, which is listed on the London Stock Exchanges and can be purchased like any ordinary share through a broker. Touting the iShares S&P Global Water as offering “a broad based exposure to shares of the world’s largest water companies, including water utilities and water equipment stocks” of water companies around the world, this fund as of March 31, 2007 was valued at U.S.$33.8 million.
  • Deutsche Bank is one of the major players in the water sector worldwide. Its Deutsche Bank Advisors have identified water as a part of the climate investment strategies. In its presentation, “Global Warming: Implications for Investors,” they have identified the four following major areas for water investment: § Distribution and management: (1) Supply and recycling, (2) water distribution and sewage, (3) water management and engineering. § Water purification: (1) Sewage purification, (2) disinfection, (3) desalination, (4) monitoring. § Water efficiency (demand): (1) Home installation, (2) gray-water recycling, (3) water meters. § Water and nutrition: (1) Irrigation, (2) bottled water.
  • Moreover, Deutsche Bank has channeled €6 billion (U.S.$8.55 billion) into climate change funds, which will target companies with products that cut greenhouse gases or help people adapt to a warmer world, in sectors from agriculture to power and construction (Reuters, October 18, 2007). In addition to SCM, Deutsche Bank also has the RREEF Infrastructure, part of RREEF Alternative Investments, headquartered in New York with main hubs in Sydney, Singapore, and London. RREEF Infrastructure has more than €6.7 billion in assets under management. One of its main targets is utilities, including electricity networks, water-treatment or distribution operations, and natural-gas networks. In October 2007, RREEF partnered with Goldman Sachs, GE, Prudential, and Babcok & Brown Ltd. to bid unsuccessfully for U.K.’s water utility Southern Water. § Crediting the boom in European infrastructure investment, the RREEF fund by August 2007 had raised €2 billion (U.S.$2.8 billion); Europe’s infrastructure market is valued at between U.S.$4 trillion to U.S.$6 trillion (DowJones Financial News Online, August 7, 2007). § Bulgaria --- Deutsche Bank Bulgaria is planning to participate in large infrastructure projects, including public-private partnership projects in water and sewage worth up to €1 billion (Sofia Echo Media, February 26, 2008). § Middle East --- Along with Ithmaar Bank B.S.C. (an private-equity investment bank in Bahrain), Deutsche Bank co-managed a U.S.$2 billion Shari'a-compliant Infrastructure and Growth Capital Fund and plans to target U.S.$630 billion in regional infrastructure.
  • In my 2008 article, I overlooked the astonishingly large land purchases (298,840 acres, to be exact) by the Bush family in 2005 and 2006. In 2006, while on a trip to Paraguay for the United Nation’s children’s group UNICEF, Jenna Bush (daughter of former President George W. Bush and granddaughter of former President George H.W. Bush) reportedly bought 98,840 acres of land in Chaco, Paraguay, near the Triple Frontier (Bolivia, Brazil, and Paraguay). This land is said to be near the 200,000 acres purchased by her grandfather, George H.W. Bush, in 2005. The lands purchased by the Bush family sit over not only South America’s largest aquifer --- but the world’s as well --- Acuifero Guaraní, which runs beneath Argentina, Brazil, Paraguay, and Uruguay. This aquifer is larger than Texas and California combined. Online political magazine Counterpunch quoted Argentinean pacifist Adolfo Perez Esquivel, the winner of 1981 Nobel Peace Prize, who “warned that the real war will be fought not for oil, but for water, and recalled that Acuifero Guaraní is one of the largest underground water reserves in South America….”
  • Paul Merrell on 23 May 14
     
     Like the land rush for Arctic lands soon to be bared of ice by global warming, banksters are also moving to capitalize on looming water shortages, aided by IMF privatization loan conditions the the dwindling of potable water supplies globally via pollution, deforestation, and aquifer depletion. All trace to the common problem over human overpopulation of the planet.  
Gary Edwards

Tax Code Tweak Might Make CNG for Vehicles More Available | RedState - 0 views

www.redstate.com/...ng-for-vehicles-more-available

William-Cassidy Natural-gas CNG Energy

shared by Gary Edwards on 08 May 12 - No Cached
  • Gary Edwards on 08 May 12
     
    Representative Dr. William Cassidy (R-LA) has put forward a common sense change to the tax code that will jump the economy of the USA forward, making use of plentiful and comparatively inexpensive natural gas. excerpt: The recent natural gas boom in the United States has been so wide-spread and profound that it has dropped natural gas prices to historical lows. These prices are so low that producers have begun to scale back operations as extraction has almost become uneconomical. We should be focused on exploring new commercial markets for natural gas to take advantage of such a low-cost energy source. Because technology and supply is currently available to sell the natural gas equivalent for about $1.50 a gallon compared with the current price of gasoline, it would seem natural for consumers to begin making the switch to compressed natural gas CNG (Compressed Natural Gas) vehicles. So if the technology is already available and we have at least a 100-year supply of natural gas right here in America, why aren't we all driving CNG cars? Unfortunately, the main obstacle is a lack of natural gas fuel infrastructure in our country. Currently in the United States, there are only 449 CNG fueling stations accessible to the public, which is dwarfed by the more than 157,000 gasoline stations. There are a number of proposals to spur natural gas infrastructure development in Washington. Not surprisingly, when it comes to Congress, the most talked about option involves subsidies for both natural gas vehicles and for the actual CNG fuel itself. While we should be using all of our available natural resources to aid in lowering the costs of transportation, the reality is that our country has neither the money to subsidize development nor the expertise to pick winners and losers in the energy and transportation sectors. As opposed to subsidies, I believe that a simple change to our tax code would help those companies that develop natural gas look at domestic retail infrastruc
Paul Merrell

Japan readies package for Trump to help create 700,000 U.S. jobs | Reuters - 0 views

www.reuters.com/...-usa-trump-japan-idUSKBN15I0RS

Japan foreign-aid U.S.-infrastructure

shared by Paul Merrell on 05 Feb 17 - No Cached
  • Japan is putting together a package it says could generate 700,000 U.S. jobs and help create a $450-billion market, to present to U.S. President Donald Trump next week, government sources familiar with the plans said. The five-part package, to be unveiled when Prime Minister Shinzo Abe visits Trump on Feb. 10 in Washington, envisage investments in infrastructure projects such as high-speed trains and cybersecurity, said the sources, who declined to be identified as they were not authorized to speak to the media. Investing in overseas infrastructure projects dovetails with a key plank in Abe’s growth strategy, which is to export "high-quality" infrastructure technology. Japan will invest 17 trillion yen ($150 billion) in public and private funds over 10 years, the sources said. That would include helping develop high-speed railways in the northeastern United States, and the states of Texas and California, and renovating subway and train cars.
  • The package also includes cooperation in global infrastructure investment, joint development of robots and artificial intelligence, and cooperation in cybersecurity and space exploration, among others. The government may tap its foreign exchange reserves account to fund part of the package, the sources said. It may also get funding from megabanks and government-affiliated financial institutions, as well as the Government Pension Investment Fund, the Asahi and other newspapers reported.
  • Paul Merrell on 05 Feb 17
     
    Of course the world's largest economy is incapable of funding its own infrastructure maintenance and development.
Paul Merrell

The Citadel Is Breached: Congress Taps the Fed for Infrastructure Funding | WEB OF DEBT... - 0 views

ellenbrown.com/...fed-for-infrastructure-funding

banksters Fed infrastructure-funding highway-trust-fund

shared by Paul Merrell on 18 Jan 16 - No Cached
  • In a landmark infrastructure bill passed in December, Congress finally penetrated the Fed’s “independence” by tapping its reserves and bank dividends for infrastructure funding. The bill was a start. But some experts, including Congressional candidate Tim Canova, say Congress should go further and authorize funds to be issued for infrastructure directly. For at least a decade, think tanks, commissions and other stakeholders have fought to get Congress to address the staggering backlog of maintenance, upkeep and improvements required to bring the nation’s infrastructure into the 21st century. Countries with less in the way of assets have overtaken the US in innovation and efficiency, while our dysfunctional Congress has battled endlessly over the fiscal cliff, tax reform, entitlement reform, and deficit reduction. Both houses and both political parties agree that something must be done, but they have been unable to agree on where to find the funds. Republicans aren’t willing to raise taxes on the rich, and Democrats aren’t willing to cut social services for the poor.
  • In December 2015, however, a compromise was finally reached. On December 4, the last day the Department of Transportation was authorized to cut checks for highway and transit projects, President Obama signed a 1,300-page $305-billion transportation infrastructure bill that renewed existing highway and transit programs. According to America’s civil engineers, the sum was not nearly enough for all the work that needs to be done. But the bill was nevertheless considered a landmark achievement, because Congress has not been able to agree on how to fund a long-term highway and transit bill since 2005. That was one of its landmark achievements. Less publicized was where Congress would get the money: largely from the Federal Reserve and Wall Street megabanks. The deal was summarized in a December 1st Bloomberg article titled “Highway Bill Compromise Would Take Money from US Banks”: The highway measure would be financed in part by a one-time use of Federal Reserve surplus funds and by a reduction in the 6 percent dividend that national banks receive from the Fed. . . . Banks with $10 billion or less in assets would be exempt from the cut. The Fed’s surplus capital comes from the 12 reserve banks. The highway bill would allow for a one-time draw of $19 billion from the surplus, which totaled $29.3 billion as of Nov. 25. . . . Banks vigorously fought the dividend cut, which was estimated to generate about $17 billion over 10 years for the highway trust fund.
Paul Merrell

How to Cut Infrastructure Costs in Half - nsnbc international | nsnbc international - 0 views

nsnbc.me/...t-infrastructure-costs-in-half

Trump infrastructure banksters publicly-owned-banks

shared by Paul Merrell on 28 Jan 17 - No Cached
  • Americans could save $1 trillion over 10 years by financing infrastructure through publicly-owned banks like the one that has long been operating in North Dakota.
  • President Donald Trump has promised to rebuild America’s airports, bridges, tunnels, roads and other infrastructure, something both Democrats and Republicans agree should be done. The country needs a full $3 trillion in infrastructure over the next decade. The $1 trillion plan revealed by Trump’s economic advisers relies heavily on public-private partnerships, and private equity firms are lining up for these plumbing investments. In the typical private equity water deal, for example, higher user rates help the firms earn annual returns of anywhere from 8 to 18 percent – more even than a regular for-profit water company might expect. But the price tag can come as a rude surprise for local ratepayers.
Paul Merrell

China stakes claim in Central and Southeast Europe | Business New Europe - 0 views

www.bne.eu/...m-central-and-southeast-europe

war & peace economic-warfare EU China infrastructure-investments

shared by Paul Merrell on 22 Dec 14 - No Cached
  • A Chinese agreement to finance a high-speed railway from Belgrade to Bucharest was one of around $10bn worth of investments, mainly in the energy and infrastructure sectors, signed during a China-Central and Eastern Europe summit this week. By funding the railway, Beijing hopes to establish a rapid connection from Greece’s Pireaus Port through the Balkans to the EU member states of Central Europe. Several agreements on the €1.5bn railway, which will be financed by soft loans from state-owned China Exim Bank, were signed between China, Hungary and Serbia on December 17. When the line is operational, the travel time between Belgrade and Budapest will be slashed from the current eight hours to just 2.4 hours. Macedonian counterpart Nikola Gruevski was also in attendance as there are plans to extend the line south to Macedonia and Greece in future. Chinese Prime Minister Li Keqiang, who headed a 200-strong delegation to Belgrade, said he expected the line would benefit both China and the countries of Central and Eastern Europe and the EU, according to a Serbian government statement.
  • Chinese shipping giant Cosco Pacific took over the management rights to half of Piraeus port and is now expanding two container terminals under a 35-year concession agreement, with the aim of turning the Greek port into one of Europe’s top five container ports. However, to take full advantage of Cosco’s investment in Piraeus and its potential to become a gateway to the CEE region, investments into transport links across the Balkans are needed. "We will propose construction of a rapid land and maritime route based on the Budapest-Belgrade railroad and the Greek port of Piraeus to improve regional connectivity," Li told journalists in advance of the summit, South China Morning Post reported. Investments into infrastructure to transport raw materials into China and Chinese manufactured goods to foreign markets is nothing new. Closer to home, Beijing is looking to fund a railway across Central Asia to create a direct rail link between its factories and the massive wholesale bazaars of Kyrgyzstan and Uzbekistan. Further afield, in May 2014, China signed an agreement in Kenya to build a new line from Mombasa to Nairobi that will extend to four other East African states in future.
  • While land rail routes across Eurasia to Europe are also being developed, sea shipping remains the cheapest route from the Far East to Europe, and Piraeus is a convenient entry point to the continent. While growth in the region has been patchy since the recent global economic crisis, in the longer-term the EU member states of Central and Eastern Europe and future entrants from the Balkans are expected to converge with longer-established EU members from Western Europe in terms of spending power. Since 2012, when the first China-CEE summit was held in Warsaw, Chinese attention on the region has steadily increased, with a focus on energy and infrastructure. Aside from the access to new markets, there are further commercial benefits for China, as Chinese companies are selected for lucrative construction contracts on projects funded by Chinese state-owned banks. On December 16, the opening day of the summit, Li told the 16 regional leaders to attend that China would launch a $3bn investment fund for the region.
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  • Also on December 16 Albania signed a deal with Exim Bank on funding for the completion of construction works on the Arber motorway that links the capital Tirana with Macedonia. In the energy sector, Serbian and Chinese officials have signed a loan agreement for the second stage of the Kostolac B thermal power project, which includes the construction of a new 350MW plant and the expansion of the adjacent Drmno open-pit coal mine. The value of the project is expected to be $715mn, of which $608mn will come from a 20-year China Exim Bank loan. In neighbouring Bosnia, Eximbank has signed an agreement with the Bosnian Federation government for a €667.8mn credit to fund construction of the 450MW unit 7 at the thermal power plant Tuzla. China's Gezhouba Group is expected to build the unit.
  • The timing of the summit, amid a sharp falling off of Russia’s influence, may also have helped China extend its influence in the region. With some exceptions, notably Serbia, most of the would-be EU member states in Southeast Europe have opted to join EU and US sanctions against Russia over Ukraine. Tit for tat sanctions imposed by Moscow caused trade between Eastern Europe and Russia to drop, a trend that is likely to continue amid the new economic crisis in Russia. Meanwhile, in a further retrenchment from the region, Russian President Vladimir Putin announced on December 1 that Russia will scrap the planned South Stream pipeline that would have supplies numerous states across the region with gas. China, meanwhile, has no political axe to grind in Eastern Europe, but hopes to take advantage of Russia’s weakness to make further inroads commercially. Poland and other countries in the region are, for example, looking to China as a potential market for food products following the Russian embargo. This would add to already booming trade ties. According to Chinese Commerce Minister Gao Hucheng, trade between China and Eastern Europe may top $60bn in 2014 - five times its 2003 level, AFP reported.
Paul Merrell

Abbott to say No to Xi and the New Asia Infrastructure Investment Bank - Twice | nsnbc ... - 0 views

nsnbc.me/...tructure-investment-bank-twice

banksters de-dollarization AIIB China dollar-collapse Australia

shared by Paul Merrell on 10 Nov 14 - No Cached
  • Australian Prime Minister Tony Abbott is expected to say no to Chinese President Xi about joining the new Chinese-led Asia Infrastructure Development Bank (AIIB) when he will meet Xi at the ASEAN summit in Beijing this week. Abbott’s no to joining the bank would come against the advise of Australian treasurer Joe Hockey and after intense U.S. pressure for Australia to reject the proposed participation.
  • The decision to reject Australia’s participation in the 21 nation regional bank was made during a session of the Australian government’s National Security Committee and was explained as a “decision made on strategic grounds”. The decision has been criticized by several of Australia’s leading experts on economy. The Asian Development Bank  (ADB) estimated in 2011 that Asia would require some US$750 per year through 2020 to meet the needs for regional infrastructure development. In 2012 the ADB merely lent US$7.5 billion reported Australia’s Treasury.
  • A growing number of regional governments including Thailand, Malaysia, Indonesia, Laos, Myanmar and many other are gravitating towards China as China increasingly opens up its economy and banking system for foreign businesses and investment.
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  • Australian Treasurer Joe Hockey repeatedly stressed that Australia’s national interests would be better served by joining the new AIIB while Abbott attempted to position the AIIB as a “unilateral institution”. While it is correct that China is the main investor into the bank, it is a 21 nation project and Abbott’s explanation is given little credence by objective economists who are aware of the inherent problems with U.S. dominance and the dominance of rogue corporate cartels who hold e.g the World Bank, the IMF and the US government in a state of capture.
  • The development gains perspective, considering that the former Chief Economist of the Bank for International Settlements (BIS) William White in 2013, and other top-economists are predicting that a collapse of the U.S. dollar and the Bretton Woods institutions has become unavoidable, that it may happened overnight, and that it is likely to happen sometime by the end of 2014 or the first half of 2015. A recent analysis of the development described U.S. pressure against nations’ joining the new Asia Infrastructure Development Bank as the choice between gold and gunfire, noting that the U.S. applies relative soft pressure against Australia, while it won’t hesitate to provoke civil wars in for example Thailand to prolong the (f)ailing new American Century, just a little bit longer.
  • Gold or Gunfire: Hedging Against the Collapse of the Dollar
Paul Merrell

Time for the Nuclear Option: Raining Money on Main Street | WEB OF DEBT BLOG - 0 views

ellenbrown.com/...n-raining-money-on-main-street

economy financial-stimulus printing-press

shared by Paul Merrell on 24 Sep 15 - No Cached
  • Predictions are that we will soon be seeing the “nuclear option” — central bank-created money injected directly into the real economy. All other options having failed, governments will be reduced to issuing money outright to cover budget deficits. So warns a September 18 article on ZeroHedge titled “It Begins: Australia’s Largest Investment Bank Just Said ‘Helicopter Money’ Is 12-18 Months Away.” Money reformers will say it’s about time. Virtually all money today is created as bank debt, but people can no longer take on more debt. The money supply has shrunk along with people’s ability to borrow new money into existence. Quantitative easing (QE) attempts to re-inflate the money supply by giving money to banks to create more debt, but that policy has failed. It’s time to try dropping some debt-free money on Main Street. The Zerohedge prediction is based on a release from Macqurie, Australia’s largest investment bank. It notes that GDP is contracting, deflationary pressures are accelerating, public and private sectors are not driving the velocity of money higher, and central bank injections of liquidity are losing their effectiveness. Current policies are not working. As a result:
  • There are several policies that could be and probably would be considered over the next 12-18 months. If private sector lacks confidence and visibility to raise velocity of money, then (arguably) public sector could. In other words, instead of acting via bond markets and banking sector, why shouldn’t public sector bypass markets altogether and inject stimulus directly into the ‘blood stream’? Whilst it might or might not be called QE, it would have a much stronger impact and unlike the last seven years, the recovery could actually mimic a conventional business cycle and investors would soon start discussing multiplier effects and positioning in areas of greatest investment.  Willem Buiter, chief global economist at Citigroup, is also recommending “helicopter money drops” to avoid an imminent global recession, stating: A global recession starting in 2016 led by China is now our Global Economics team’s main scenario. Uncertainty remains, but the likelihood of a timely and effective policy response seems to be diminishing. . . . Helicopter money drops in China, the euro area, the UK, and the U.S. and debt restructuring . . . can mitigate and, if implemented immediately, prevent a recession during the next two years without raising the risk of a deeper and longer recession later.
  • In the UK, something akin to a helicopter money drop was just put on the table by Jeremy Corbyn, the newly-elected Labor leader. He proposes to give the Bank of England a new mandate to upgrade the economy to invest in new large scale housing, energy, transport and digital projects. He calls it “quantitative easing for people instead of banks” (PQE). The investments would be made through a National Investment Bank set up to invest in new infrastructure and in the hi-tech innovative industries of the future. Australian blogger Prof. Bill Mitchell agrees that PQE is economically sound. But he says it should not be called “quantitative easing.” QE is just an asset swap – cash for federal securities or mortgage-backed securities on bank balance sheets. What Corbyn is proposing is actually Overt Money Financing (OMF) – injecting money directly into the economy. Mitchell acknowledges that OMF is a taboo concept in mainstream economics. Allegedly, this is because it would lead to hyperinflation. But the real reasons, he says, are that: It cuts out the private sector bond traders from their dose of corporate welfare which unlike other forms of welfare like sickness and unemployment benefits etc. has made the recipients rich in the extreme. . . . It takes away the ‘debt monkey’ that is used to clobber governments that seek to run larger fiscal deficits.
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  • Tim Worstall, writing in the UK Register, objects to Corbyn’s PQE (or OMF) on the ground that it cannot be “sterilized” the way QE can. When inflation hits, the process cannot be reversed. If the money is spent on infrastructure, it will be out there circulating in the economy and will not be retrievable. Worstall writes: QE is designed to be temporary, . . . because once people’s spending rates recover we need a way of taking all that extra money out of the economy. So we do it by using printed money to buy bonds, which injects the money into the economy, and then sell those bonds back once we need to withdraw the money from the economy, and simply destroy the money we’ve raised. . . . If we don’t have any bonds to sell, it’s not clear how we can reduce [the money supply] if large-scale inflation hits.
  • The problem today, however, is not inflation but deflation of the money supply. Some consumer prices may be up, but this can happen although the money supply is shrinking. Food prices, for example, are up; but it’s because of increased costs, including drought in California, climate change, and mergers and acquisitions by big corporations that eliminate competition. Adding money to the economy will not drive up prices until demand is saturated and production has hit full capacity; and we’re a long way from full capacity now. Before that, increasing “demand” will increase “supply.” Producers will create more goods and services. Supply and demand will rise together and prices will remain stable. In the US, the output gap – the difference between actual output and potential output – is estimated at about $1 trillion annually. That means the money supply could be increased by at least $1 trillion annually without driving up prices.
  • If PQE does go beyond full productive capacity, the government does not need to rely on the central bank to pull the money back. It can do this with taxes. Just as loans increase the money supply and repaying them shrinks it again, so taxes and other payments to the government will shrink a money supply augmented with money issued by the government. Using 2012 figures (drawing from an earlier article by this author), the velocity of M1 (the coins, dollar bills and demand deposits spent by ordinary consumers) was then 7. That means M1 changed hands seven times during 2012 – from housewife to grocer to farmer, etc. Since each recipient owed taxes on this money, increasing M1 by one dollar increased the tax base by seven dollars. Total tax revenue as a percentage of GDP in 2012 was 24.3%. Extrapolating from those figures, $1.00 changing hands seven times could increase tax revenue by $7.00 x 24.3% = $1.70. That means the government could, in theory, get more back in taxes than it paid out. Even with some leakage in those figures and deductions for costs, all or most of the new money spent into the economy might be taxed back to the government. New money could be pumped out every year and the money supply would increase little if at all.
  • Besides taxes, other ways to get money back into the Treasury include closing tax loopholes, taxing the $21 trillion or more hidden in offshore tax havens, and setting up a system of public banks that would return the interest on loans to the government. Net interest collected by U.S. banks in 2014 was $423 billion. At its high in 2007, it was $725 billion. Thus there are many ways to recycle an issue of new money back to the government. The same money could be spent and collected back year after year, without creating price inflation or hyperinflating the money supply. This not only could be done; it needs to be done. Conventional monetary policy has failed. Central banks have exhausted their existing toolboxes and need to explore some innovative alternatives.
  • Paul Merrell on 24 Sep 15
     
    Debt having failed as a method of money creation leads us back to the printing press method. But on whom are those helicopters to drop their new money? And how to we ensure that the banksters are not among them?
Paul Merrell

BBC News - UK support for China-backed Asia bank prompts US concern - 0 views

www.bbc.com/...world-australia-31864877

war & peace economic-warfare UK AIIB banksters U.S.-foreign-policy

shared by Paul Merrell on 15 Mar 15 - No Cached
  • The US has expressed concern over the UK's bid to become a founding member of a Chinese-backed development bank. The UK is the first big Western economy to apply for membership of the Asian Infrastructure Investment Bank (AIIB). The US has raised questions over the bank's commitment to international standards on governance. "There will be times when we take a different approach," a spokesperson for Prime Minister David Cameron said about the rare rebuke from the US. The AIIB, which was created in October by 21 countries, led by China, will fund Asian energy, transport and infrastructure projects. The UK insisted it would demand the bank adhere to strict banking and oversight procedures. "We think that it's in the UK's national interest," said Mr Cameron's spokesperson.
  • In a statement announcing the UK's intention to join the bank, Mr Osborne said that joining the AIIB at the founding stage would create "an unrivalled opportunity for the UK and Asia to invest and grow together". The hope is that investment in the bank will give British companies an opportunity to invest in the world's fastest growing markets. But the US sees the Chinese effort as a ploy to dilute US control of the banking system, and has persuaded regional allies such as Australia, South Korea and Japan to stay out of the bank. In response to the move, US National Security Council spokesman Patrick Ventrell said: "We believe any new multilateral institution should incorporate the high standards of the World Bank and the regional development banks." "Based on many discussions, we have concerns about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards," he added.
  • The Financial Times (FT) newspaper reported on Thursday that US officials had complained about the British move. The report cited an unnamed senior US administration official as saying the British decision was taken after "virtually no consultation with the US". "We are wary about a trend toward constant accommodation of China," the newspaper quoted the US official as saying.
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  • The founding member countries of the AIIB have agreed the basic parameters that would determine the capital structure of the new bank would be relative gross domestic product. Banking experts have estimated that, if taken at face value, this would give China a 67% shareholding in the new bank. That's significantly different than the Asia Development Bank, which has a similar structure to the World Bank and has been in existence 1966. There, the majority stakes are controlled by Japan and the US.
  • Paul Merrell on 15 Mar 15
     
    The line comes to mind about rats deserting a sinking ship. 
Paul Merrell

Report: Verizon Claimed Public Utility Status To Get Government Perks - Slashdot - 0 views

news.slashdot.org/...status-to-get-government-perks

net-neutrality FCC Verizon banksters

shared by Paul Merrell on 29 May 14 - No Cached
  • Research for the Public Utility Law Project (PULP) has been released which details 'how Verizon deliberately moves back and forth between regulatory regimes, classifying its infrastructure either like a heavily regulated telephone network or a deregulated information service depending on its needs. The chicanery has allowed Verizon to raise telephone rates, all the while missing commitments for high-speed internet deployment' (PDF). In short, Verizon pushed for the government to give it common carrier privileges under Title II in order to build out its fiber network with tax-payer money. Result: increased service rates on telephone users to subsidize Verizon's 'infrastructure investment.' When it comes to regulations on Verizon's fiber network, however, Verizon has been pushing the government to classify its services as that of information only — i.e., beyond Title II. Verizon has made about $4.4 billion in additional revenue in New York City alone, 'money that's funneled directly from a Title II service to an array of services that currently lie beyond Title II's reach.' And it's all legal. An attorney at advocacy group Public Knowledge said it best: 'To expect that you can come in and use public infrastructure and funds to build a network and then be free of any regulation is absurd....When Verizon itself is describing these activities as a Title II common carrier, how can the FCC look at broadband internet and continue acting as though it's not a telecommunication network?'"
  • Paul Merrell on 29 May 14
     
    Let's also not forget that what is now named "Verizon" used to be named Bell Atlantic, one of the seven Baby Bells that were spun off by AT&T by government order during antitrust proceedings.  In other words, this is one of the companies rate-payers financed through a heavily-regulated analog telephony absolute monopoly. But Verizon wants to spread its wings and escape the chains of regulation as a telecommunications carrier. While having its cake and eating it to, according to this article. The FCC has poised itself through a proposed rule with the flexibility to postpone a decision on net neutrality.  AT&T famously was allowed to keep its R&D arm while being freed of the expense of upgrading the U.S. telephony network from analog to digital and from copper wire to fibre optic.  And pay for those Baby Bells to make that transition we did. I remember monthly bills for a two person office running as high as $1,100 a month for calls all carried from Baby Bell to AT&T and back to another Baby Bell. All at state-regulated rates with FCC looking the other way. But now Verizon, Comcast (the originally munipally regulated cable television monopolies) and the few other "competing" survivors of that broadband rollout, having had their infrastructure paid for by the ratepayers, want to fly off and begin charging us at the other end of the pipe,via charges to content providers that will be passed on to us. Leading to the squeezing out of Mom and Pop internet businesses by the big content providers that can afford the charges and pass them on to us. This is looking more and more like another massive rip-off of the customers who already paid for that infrasture. Is that banksters I smell, privatizing a enormous public utility in the name of free markets?      
Paul Merrell

Venezuela Moves Forward with Special Economic Zones to Attract Investment in Developmen... - 0 views

venezuelanalysis.com/11313

war & peace economic-warfare Venezuela China

shared by Paul Merrell on 04 Apr 15 - No Cached
  • The Venezuelan government will unveil its comprehensive plan for the creation of Special Economic Zones (SEZ) by the end of the month. The plan, as presented by Vice-President of Planning Ricardo Menendez on Monday, will outline strategic areas of the country where policy incentives will attract foreign and national investment with the aim of promoting export-oriented production and "integral development". The SEZ represent an important dimension of the economic development strategy laid out by late president Hugo Chávez and President Nicolas Maduro, which seeks to fortify Venezuela's vital infrastructure, particularly in the areas of telecommunications, electricity, and water and land transport.
  • So far 47 firms have committed to setting up operations in the SEZ, and a further 100 have requested more information regarding potential projects. Chinese firms constitute the bulk of the foreign partners, with $2 billion in contracts already desisgnated to manufacturing and construction projects, The Bolivarian government has imposed a series of regulations governing the SEZs which include a minimum 50% Venezuelan share in all projects as well as a mandate obliging all firms to open accounts with the National Public Banking System.
  • Paul Merrell on 04 Apr 15
     
    So the U.S. issues trade sanctions against Venezuela while China invests in Venezuela infrastructure and trade. 
Paul Merrell

Venezuela and Russia Reach $14 Billion Oil and Gas Deal | venezuelanalysis.com - 0 views

venezuelanalysis.com/11400

war & peace economic-warfare Russia Venezuela oil-gas-development

shared by Paul Merrell on 30 May 15 - No Cached
  • Venezuelan President Nicolas Maduro concluded an agreement with Russia's state-owned Rosneft that will see an additional $14 billion in investment in the South American country's oil and gas industry over the coming years.    The move was announced by the socialist leader on Wednesday following a meeting he convened between the president of Venezuela's state oil company PDVSA, Eulogio de Pino, and Rosneft president Igor Sechin.    "We had a great meeting and agreed on investment of over $14 billion,” declared Maduro in a television address from Miraflores palace.    The new investment will reportedly go towards further developing Venezuela's Orinoco Belt in the country's northeast, which is home to some of the worlds largest reserves of crude oil and already contains 250 oil fields. PDVSA aims to double Venezuela's oil output to 6 million barrels a day by 2019, four million of which are to come from the Orinoco Belt. 
  • Speaking from the 9th meeting of the High Level Intergovernmental Commission in Moscow, Venezuelan foreign minister Delcy Rodriguez expressed her solidarity with Russia, affirming that both Venezuela and Russia "have become victims of unconventional war".    "We are convinced that we share the same idea about what is occuring on the global level. Just as the Soviets did their best to overcome the Nazis, today Russia is battling with all its strength to navigate a new geopolitical power structure that permits it to reduce the hegemony and expansionism of imperialism."
  • Paul Merrell on 30 May 15
     
    Interesting. Are China, Russia, and Venezuela getting positioned to drive down the price of oil produced by the Gulf Coast States that is only sold for U.S. dollars? China has already invested mightily in Venezuela's oil and gas infrastructure. Note that it's unlikely that Russia and Venezuela could pull off such a move without heavy subsidies from China. (This deal is seemingly against Russia's interests in its revenue from its own gas and oil.) 
Paul Merrell

US Military Uses IMF and World Bank to Launder 85% of Its Black Budget | Global Researc... - 1 views

www.globalresearch.ca/...5469097

Dark-State black-budget banksters IMF World-Bank WTO CIA Fitts

shared by Paul Merrell on 24 Aug 15 - No Cached
  • hough transparency was a cause he championed when campaigning for the presidency, President Obama has largely avoided making certain defense costs known to the public. However, when it comes to military appropriations for government spy agencies, we know from Freedom of Information Act requests that the so-called “black budget” is an increasingly massive expenditure subsidized by American taxpayers. The CIA and and NSA alone garnered $52.6 billion in funding in 2013 while the Department of Defense black ops budget for secret military projects exceeds this number. It is estimated to be $58.7 billion for the fiscal year 2015. What is the black budget? Officially, it is the military’s appropriations for “spy satellites, stealth bombers, next-missile-spotting radars, next-gen drones, and ultra-powerful eavesdropping gear.” However, of greater interest to some may be the clandestine nature and full scope of the black budget, which, according to analyst Catherine Austin Fitts, goes far beyond classified appropriations. Based on her research, some of which can be found in her piece “What’s Up With the Black Budget?,” Fitts concludes that the during the last decade, global financial elites have configured an elaborate system that makes most of the military budget unauditable. This is because the real black budget includes money acquired by intelligence groups via narcotics trafficking, predatory lending, and various kinds of other financial fraud.
  • The result of this vast, geopolitically-sanctioned money laundering scheme is that Housing and Urban Devopment and other agencies are used for drug trafficking and securities fraud. According to Fitts, the scheme allows for at least 85 percent of the U.S. federal budget to remain unaudited. Fitts has been researching this issue since 2001, when she began to believe that a financial coup d’etat was underway. Specifically, she suspected that the banks, corporations, and investors acting in each global region were part of a “global heist,” whereby capital was being sucked out of each country. She was right.
  • As Fitts asserts, “[She] served as Assistant Secretary of Housing at the US Department of Housing and Urban Development (HUD) in the United States where I oversaw billions of government investment in US communities…..I later found out that the government contractor leading the War on Drugs strategy for U.S. aid to Peru, Colombia and Bolivia was the same contractor in charge of knowledge management for HUD enforcement. This Washington-Wall Street game was a global game. The peasant women of Latin America were up against the same financial pirates and business model as the people in South Central Los Angeles, West Philadelphia, Baltimore and the South Bronx.” This is part of an even larger financial scheme. It is fairly well-established by now that international financial institutions like the World Trade Organization, the World Bank, and the International Monetary Fund operate primarily as instruments of corporate power and nation-controlling infrastructure investment mechanisms. For example, the primary purpose of the World Bank is to bully developing countries into borrowing money for infrastructure investments that will fleece trillions of dollars while permanently indebting these “debtor” nations to West. But how exactly does the World Bank go about doing this? John Perkins wrote about this paradigm in his book, Confessions of an Economic Hitman. During the 1970s, Perkins worked for the international engineering consulting firm, Chas T. Main, as an “economic hitman.” He says the operations of the World Bank are nothing less than “pure economic colonization on behalf of powerful corporations and banks that use the United States government as their tool.”
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  • In his book, Perkins discusses Joseph Stiglitz, the Chief Economist for the World Bank from 1997-2000, at length. Stiglitz described the four-step plan for bamboozling developing countries into becoming debtor nations: Step One, according to Stiglitz, is to convince a nation to privatize its state industries. Step Two utilizes “capital market liberalization,” which refers to the sudden influx of speculative investment money that depletes national reserves and property values while triggering a large interest bump by the IMF. Step Three, Stiglitz says, is “Market-Based Pricing,” which means raising the prices on food, water and cooking gas. This leads to “Step Three and a Half: The IMF Riot.” Examples of this can be seen in Indonesia, Bolivia, Ecuador and many other countries where the IMF’s actions have caused financial turmoil and social strife. Step 4, of course, is “free trade,” where all barriers to the exploitation of local produce are eliminated. There is a connection between the U.S. black budget and the trillion dollar international investment fraud scheme. Our government and the banking cartels and corporatocracy running it have configured a complex screen to block our ability to audit their budget and the funds they use for various black op projects. However, they can not block our ability to uncover their actions and raise awareness.
Paul Merrell

Will Trump hop on an American Silk Road? | Asia Times - 0 views

www.atimes.com/...l-trump-hop-american-silk-road

globalization China U.S.-spending war & peace

shared by Paul Merrell on 27 Jan 17 - No Cached
  • ysteria reigns supreme at the dawn of the Trump era, with the President rebranded across the whole ideological spectrum as an American Mao or even an American Hitler. Let’s step away from this “American [media] carnage” to examine a few facts concerning the unofficial G2: US-China relations. A case can be made that Beijing has already landed a 1-2-3 punch, pre-empting the possibility of a US-initiated trade war.
  • It started with Jack Ma’s by now notorious visit to Trump Tower, when he developed his idea of helping small American businesses sell their products in China and across Asia through Alibaba’s network, thus creating at least “1 million jobs” (Ma’s number) in the US. Then came President Xi Jinping’s masterclass at Davos, where he positioned himself as Ronald Xi Reagan selling “inclusive” globalization to the stalwarts of international turbo-capitalism. Finally Ma again, also at Davos, came up with a crystal clear, cause-and-effect formulation on globalization and US economic distress.
  • Ma said, “In the past 30 years, companies like IBM, Cisco and Microsoft made tons of money.” The problem was how the US spent the wealth: “In the past 30 years, America has had 13 wars at a cost of US$14.2 trillion.” So what if the US “had spent part of that money on building up their infrastructure, helping white-collar and blue-collar workers? You’re supposed to spend money on your own people. It’s not that other countries steal American jobs. It is your strategy – that you did not distribute the money in a proper way.” In the meantime, something quite extraordinary happened at the Asian Financial Forum in Hong Kong, one day before Xi’s Davos speech. China Investment Corporation (CIC) chairman Ding Xuedong, referring to Trump’s much-vaunted US$1 trillion infrastructure building plan, said that created fabulous investment opportunities for China and his US$800 billion sovereign fund. According to Ding, Washington will need at least an astonishing US$8 trillion to fund the infrastructure spectacular. Federal government and US private investors are not enough: “They have to rely on foreign investors.” And CIC is ready for it – focusing already on “alternative investments in the US”.
  • Paul Merrell on 27 Jan 17
     
    Pepe Escobar
Gary Edwards

The Daily Bell - Catherine Austin Fitts on Moral Investing and the Coming Equity 'Crash... - 1 views

www.thedailybell.com/...and-the-Coming-Equity-Crash-Up

Banksters Federal-Reserve-Bankster-Cartel Catherine-Austin-Fitts

shared by Gary Edwards on 16 Oct 13 - No Cached
  • If you talk about legacy systems and then a breakaway civilization, the legacy systems were financed with debt and if the resources have basically been shifted out and over into "NewCo" then that's going to be an equity model. We're literally coming into what I consider to be a planetary debt for equity swap. So the question for all of us is how do we navigate the turn? When do you leave the bond market and when does the equity increase occur? We've seen North America equity markets rising and the emerging markets falling this year.
  • We're seeing a tremendous divergence in the economy in North America between those portions of the economy that are adapting new technology and growing and the rest of the economy.
  • The other thing I watch is what the divergence means to bond credits and to equity valuations. If you look at the indices you don't really see it. If you look inside the indices you see some enormous splits in quality and value going on.
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  • The slow burn is a world in which for most people income is flat or falling and expenses are steadily rising. It's a debasement scenario. And the reality is the central banks have been able to have a quite liberal monetary policy because we've been able to offset that with labor deflation. So by globalizing labor and instituting technology you have tremendous deflationary pressures, which offset very generous monetary policy.
  • Starting in the '90s a decision was made to move significant amounts of capital out of existing systems in  the developed world and literally trillions of dollars of financial fraud was engineered to do that. As a financial phenomenon it was quite clever and trillions have literally been moved out between the fraud and the bailouts. I think what the Fed has been doing with quantitative easing is running a shredding operation where they buy up the fraudulent mortgage securities paper and are shredding it.
  • If you look at the Treasury, they've run a very tight regulatory process where that money doesn't seep out on Main Street. It's quite phenomenal the way they've managed to control it. I think one of the big questions is where is that money going to go now? It certainly looks to me like a great effort is being made to make sure it goes into equities, sort of keeps the bond market afloat and goes into equities. So I look it as a very political move.
  • You can balance the budget with fiscal measures or you can balance the budget by the Fed just buying bonds and if you look at the Fed's balance sheet, I think they have a much greater capacity to buy bonds. If you look at all the money that was stolen, the breakaway civilization has plenty of money to buy bonds.
  • I would say so far the Fed's policies have worked for what they're intended to do. We've moved a tremendous amount of money out of the economy. We've now basically run through the statute of limitations or done whatever management needed to cut the cords so that what I call the legacy systems can't get the money back. So the financial coup d'état has been successful and now the cover-up is pretty much over and successful.
  • So now you have big decisions. You have two economies. Before this started what I call the legacy systems had $100 trillion of liabilities and $100 trillion of assets – now, I'm just pulling those numbers out of the air – and
  • the coup moved $40 trillion of assets over into NewCo
  • if you will. Now we've got the legacy systems trying to reconcile $60 trillion of assets to $100 trillion of liabilities and there is a long, drawn-out, grinding process by which some people will get 50 cents on the dollar, some people will get zero cents on the dollar, some people will get 100 cents on the dollar. It's just a very difficult, complex and tangled political scene as to how that's going to all happen. Meantime, NewCo, with $40 trillion dollars, is investing and going gangbusters. NewCo is enjoying an unprecedented boom, investing in lots of new technology and new frontiers, including space. So I think the next step is to manage the lowering of expectations in the legacy systems. That's basically what the administration and the Fed are going to be doing for the next couple years, is just gutting their way through retirees' disappointment.
  • There are three things
  • Number one, Obamacare was created to create a framework that would allow significant reduction of costs and benefits under Medicare over time and healthcare over time;
  • Well, the goal of Obamacare is to control.
  • number two, Obamacare was to provide much more control over both the medical establishment and the population at large;
  • and then, three, to do it in a way that will protect corporate profits.
  • in a relatively short period of time US Medicare expenses would be several multiplicities of the GNP.
  • It's clearly a system that makes no economic sense. It's not just that people are aging. If we eat food that has little nutrition and provide healthcare in which pharmaceutical companies are allowed to charge many multiples of what they charge in other countries you're going to get a financial train wreck, which is where we're headed.
  • So I think the goal was to reconcile that and do it in a way that favors corporations and control.
  • If you go around the entire financial ecosystem, they're getting hit within every line by the same pro-centralization policies that ultimately go up to the same people.
  • Do I think it will snuff out the recovery? No. I think it will simply destroy the economics for a whole world of people who were productive.
  • I don't think the banks are fragile. What happened was they were asked to do a job, they did it and now they've taken all the fraudulent paper and sold it to the Fed or torn it up because they had so much in federal credit arbitrage earnings during this period. So I don't think they're fragile.
  • So it certainly puts us in a position where the creditworthiness of a lot of sovereign debt depends on government military might and the ability to debase a variety of players.
  • There's been a lot of regulation to make it easy for Wall Street to control and make it difficult for small businesses to raise and circulate liquid equity. It's one of the areas in the economy where there really has been a very serious conspiracy.
  • if you want to go really fast and prototype and build out infrastructure, the best way to do it is to make capital available to early venture and start-ups.
  • we, as a society, have stopped the markets from working in the start-up and the small business space.
  • If you look at it across all the different tools, from fabrication technology to new composite materials to robotics to lasers, we're reaching a critical mass of the economic costs dropping and the speed of learning accelerating.
  • If you look back at the history of the US stock market you'll see two huge spikes, one in the '20s, one in the '90s, both when very profound new communication and information technology came out.
  • I think we're in danger of another tech bubble. If you look at who's interested in putting money in this and getting lots of prototypes, the last time they did this was in the '90s. They made a fortune on fraud and they used it not only to serve some fundamental economic purposes but they used it to drain out the pension funds and the retail investors.
  • securities convertible into store credits
  • Wall Street doesn't understand about crowdfunding, are the new alignments that are going to be created in terms of circulating knowledge and purchases and money between consumers and entrepreneurs and companies. It's going to create a whole new level of intimacy.
  • I recommend the documentary, "The Naked Brand." It gives a good sense of the worth of that intimacy and the change from a mass media model to much more intimate relationships
  • awakening of global consciousness.
  • in North America there is almost an astonishing lack of transparency about how government money works within the jurisdiction for which we vote for political representation.
  • So if you were going to have proper transparency in America you would have annual financial statements for your congressional district as well as for the whole country.
  • Now, the government has refused since 1995, as required by law, to produce annual financial statements let alone for the places in which you're voting for jurisdiction. And if you're going to have any kind of citizenry accountability or legislator accountability you have to have that kind of transparency and the government has gone to enormous lengths to prevent that kind of transparency while pretending that we're very transparent. So the Internet is going to make it more and more difficult for that absence of transparency to continue or be justified, and that's good.
  • if you have all your assets in the legacy economy and none in the growing economy you're going to suffer.
  • That's number one.
  • Number two, a lot of households have assets which represent liabilities of the legacy economy, whether Social Security, Medicare or others, and one of the things you have to understand is the politics – you need to not get trapped in the politics of stringing people out for those benefits. Do the best you can but don't get lost in the treadmill of trying to get promised benefits that may or may not come true. And to the extent that you can not get financially dependent on those benefits it would be very good.
  • The final thing is, of course, and readers know this if they're reading The Daily Bell, you're dealing in a system that includes a significant amount of corruption and fraud so you just need to be extremely careful about the quality of the people or the enterprises in which you invest or do business with and keep your assets fairly diversified in terms of both areas of the economy, or sectors, and places.
  • Take a look at different predictions that gold is going to increase significantly in value. All those predictions assume that the monetary inflation is going to spill into commodities. And what you're watching instead is the G-7 have been essentially building a corral that forces the horses to run out through the stock market. That's why I call it a crash-up.
  • I think one scenario we're looking at is the possibility of a crash-up scenario where that monetary increase is funneled into the equity markets. One of the most important questions there is, can you get the global population interested in investing in equities? Because the long bond market bull is coming to a close.
  • We have two choices. We can basically write down the debt and go through a huge crunch period or we can have a crash-up in the equity markets.
  • Right after 9/11 – and General Wesley Clark has said this and I experienced it in my tiny little community in Tennessee – we were basically given what the battle plan was going to be – the US military taking over Eurasia. First we were going to go to Afghanistan, then we were going to go to Iraq, then we were going to go to Libya, then we were going to go to Syria and then we're going to Iran. It was all laid out for us and we seem to be following that battle plan, albeit slower than predicted at that time.
  • If we're going to create a global financial system and a one-world currency, you need everybody in the central banking model. You have outliers. We seem to be bringing in all the outliers. As we do, we are trying to checkmate Russia and China within Eurasia, because I think control of Eurasia is essential for maintaining global empire.
  • what we're watching is an effort to bring everybody into a centrally controlled central banking model.
  • Gary Edwards on 16 Oct 13
     
    Catherine is a frequent guest on CoastToCoastAM.com, so I've come to know her well.  Although this interview doesn't discuss her ability to see into the future, I know from experience that she is a real visionary hitting the mark at an astounding clip.  Chalk this interview up as a must read.
Paul Merrell

The Money Changers Serenade: A New Bankers' Plot to Steal Your Deposits | Global Research - 0 views

www.globalresearch.ca/...5359018

banksters fraud electronic-currency Summers

shared by Paul Merrell on 25 Nov 13 - No Cached
  • Writing in the Wall Street Journal (“Confessions of a Quantitative Easer,” November 11, 2013), Andrew Huszar confirms my explanation to be the correct one. Huszar is the Federal Reserve official who implemented the policy of QE. He resigned when he realized that the real purposes of QE was to drive up the prices of the banks’ holdings of debt instruments, to provide the banks with trillions of dollars at zero cost with which to lend and speculate, and to provide the banks with “fat commissions from brokering most of the Fed’s QE transactions.” (See: www.paulcraigroberts.org) This vast con game remains unrecognized by Congress and the public. At the IMF Research Conference on November 8, 2013, former Treasury Secretary Larry Summers presented a plan to expand the con game. Summers says that it is not enough merely to give the banks interest free money. More should be done for the banks. Instead of being paid interest on their bank deposits, people should be penalized for keeping their money in banks instead of spending it. To sell this new rip-off scheme, Summers has conjured up an explanation based on the crude and discredited Keynesianism of the 1940s that explained the Great Depression as a problem caused by too much savings. Instead of spending their money, people hoarded it, thus causing aggregate demand and employment to fall.
  • Summers says that today the problem of too much saving has reappeared. The centerpiece of his argument is “the natural interest rate,” defined as the interest rate at which full employment is established by the equality of saving with investment. If people save more than investors invest, the saved money will not find its way back into the economy, and output and employment will fall. Summers notes that despite a zero real rate of interest, there is still substantial unemployment. In other words, not even a zero rate of interest can reduce saving to the level of investment, thus frustrating a full employment recovery. Summers concludes that the natural rate of interest has become negative and is stuck below zero. How to fix this? The way to fix it, Summers says, is to charge people for saving money. To avoid the charges, people would spend the money, thus reducing savings to the level of investment and restoring full employment. Summers acknowledges that the problem with his solution is that people would take their money out of banks and hoard it in cash holdings. In other words, the cash form of money provides consumers with a freedom to save that holds down consumption and prevents full employment. Summers has a fix for this: eliminate the freedom by imposing a cashless society where the only money is electronic. As electronic money cannot be hoarded except in bank deposits, penalties can be imposed that force unproductive savings into consumption.
  • for Summers, the plight of the consumer is not the problem. The problem is the profits of the banks. Summers has the solution, and the establishment, including Paul Krugman, is applauding it. Once the economy officially turns down again, watch out.
  • Paul Merrell on 25 Nov 13
     
    Paul Craig Roberts exposes Larry Summers formula for the banksters to grab money from everyone: eliminate all but electronic-currency and penalize savings. Not mentioned by Roberts, but much of the infrastructure for this is already in place. For example, late last year all recipients of Social Security and VA benefit checks were notified that after March 1, 2013, they would be in violation of the law if they continued to receive paper checks. They were required to enroll in approved electronic deposit programs, all of which are offered by banks. Until about two years ago, people could merely state in writing that they didn't want it and could continue receiving paper checks. But Congress closed that loophole.  (I remain out of compliance.) Debit card is now mandatory, although they have not yet enacted penalties for non-compliance.  So the banksters now get the "float" on virtually all federal SS and VA benefit payments until spent. That's as opposed to the prior Treasury Department drafts whose funds were not in the banking system.   More to the point, the web portal for the federal "Go Direct" program to sign up for direct deposit is in place and debugged. It wouldn't take much beyond a bigger data set to issue debit cards for everyone in the U.S. during a transition to a cashless economy.  The Constitution says gold and silver only for payment of debts; paper currency paved the way for financial abuse of the economy by banksters. Now Summers wants to do away with cash entirely in favor of digital currency with penalties for saving? My life savings must be surrendered to a bank so I can be penalized for saving? And of course moving to all-digital currency would give the spy agencies a much more detailed record of your purchases to work with. The location where you bought that last cup of coffee is instantly available to the NSA? Gimme a break!    
Paul Merrell

Libya: Connect the Dots-You Get a Giant Dollar Sign - WhoWhatWhy - 1 views

whowhatwhy.com/...ts-you-get-a-giant-dollar-sign

war & peace banksters libya Goldman Sachs

shared by Paul Merrell on 17 Nov 14 - No Cached
  • It’s true that Arab Spring is a good thing. It’s true Qaddafi is a bad guy. But connect the dots, and you will see that he is being set up. The evidence points to a plan to create an “Arab Spring” for the Good Old Boys—CIA, banks, oil companies. Read and see if you don’t agree.
  • Paul Merrell on 17 Nov 14
     
    A few more pieces of the Libya puzzle. It seems that Goldman Sachs managed to lose $1.3 billion invested by the pre-war Libyan government. No wonder Gadafi was pushing so hard for a Pan-African infrastructure investment bank and currency based on precious metals. 
Paul Merrell

Washington Misses Bigger Picture of New Chinese Bank « LobeLog - 0 views

www.lobelog.com/er-picture-of-new-chinese-bank

shared by Paul Merrell on 22 Mar 15 - No Cached
  • Bibi Netanyahu’s election, persistent violence through much of the Middle East and North Africa, and intensified efforts to forge a nuclear deal between the P5+1 and Iran topped the news here in Washington this week. But a much bigger story in terms of the future order of global politics was taking place in Europe and Beijing. The story was simply this: virtually all of the closest European allies of the United States, beginning with Britain, defied pressure from Washington by deciding to apply for founding membership in the Asian Infrastructure Investment Bank (AIIB). This Chinese initiative could quickly rival the World Bank and the Asia Development Bank as a major source of funding for big development projects across Eurasia. The new bank, which offers a serious multilateral alternative to the Western-dominated international financial institutions (IFIs) established in the post-World War II order, is expected to attract about three dozen initial members, including all of China’s Asian neighbors (with the possible exception of Japan). Australia, Russia, Saudi Arabia, and other Gulf states are also likely to join by the March 31 deadline set by Beijing for prospective co-founders to apply. Its $50 billion in initial capital is expected to double with the addition of new members, and that amount could quickly grow given China’s $3 trillion in foreign-exchange reserves. More details about the bank can be found in a helpful Q&A here at the Council on Foreign Relations website.
  • Along with the so-called BRICS bank—whose membership so far is limited to Brazil, Russia, India, China and South Africa—the AIIB poses a real “challenge to the existing global economic order,” which, of course, Western nations have dominated since the establishment of the International Monetary Fund (IMF) and the World Bank in the final days of World War II. As one unnamed European official told The New York Times, “We have moved from the world of 1945.” That Washington’s closest Western allies are now racing to join the AIIB over U.S. objections offers yet more evidence that the “unipolar moment” celebrated by neoconservatives and aggressive nationalists 25 years ago and then reaffirmed by the same forces after the 2003 Iraq invasion is well and truly. And yet, these same neoconservatives continue to insist that—but for Obama’s weakness and defeatism—the United States remains so powerful that it really doesn’t have to take account of anyone’s interests outside its borders except, maybe, Israel’s. (That Washington’s closest Western allies are now racing to join the new bank over U.S. objections could also presage a greater willingness to abandon the international sanctions regime against Iran if Washington is seen as responsible for the collapse of the P5+1 nuclear negotiations with Tehran. Granted, Iran’s economy—and its potential as a source of investment capital—is itsy-bitsy compared to China.)
  • Indeed, commentators are depicting US allies’ decision to join the AIIB (see here, here, and here as examples) as a debacle for U.S. diplomacy. The Wall Street Journal editorial board has predictably blamed Obama for defeat, calling it a “case study in declining American influence” (although it also defended Washington’s decision against joining and accused Britain of “appeasing China for commercial purposes.”) What the Journal predictably didn’t mention was a key reason why the administration did not seek membership in the new bank: there was virtually no chance that a Republican-dominated Congress would approve it. Indeed, one reason Beijing launched its initiative and so many of our allies in both Asia and Europe have decided to join is their frustration with Republicans in Congress who have refused to ratify a major reform package designed to give developing countries, including China, a little more voting power on the Western-dominated governing boards of the IMF and the World Bank. The Group of 20 (G20) biggest economic powers actually proposed this reform in 2010, and it doesn’t even reduce Washington’s voting power, which gives it an effective veto over major policy changes in both institutions. As a result of this intransigence, the United States is the only G-20 member that has failed to ratify the reforms, effectively blocking their implementation.
  • Paul Merrell on 22 Mar 15
     
    U.S. global hegemony is rapidly disintegrating as former puppet states in Europe jump from the dwindling dollar economy to the rising remnimbi/ruble BRICS economies. And many of the "stans" south of Russia threatened by U.S. mercenaries provided by the Gulf Coast States are jumping in that direction too, along with Turkey, a NATO member. The Stans involved are oil and natural gas rich; combined with Russian oil and gas, they have enough oil and gas reserves to rival the Gulf Coast States.  The most interesting part to me is the debate now under way in the EU over dropping out of NATO and creating a replacement European mutual defense force that excludes the U.S. I'm beginning to hit some chatter about inviting Russia into that hypoethesized treaty. That makes sense for the EU because it would give Europe the benefit of Russian nuclear deterrence, both in land and submarine-based ICBMs. I'm not convinced that Russia would sign on. Russia is already running joint military exercises with China, which is playing the role of Russia's economic savior at this point. So China might have the final say on that scenario. A pan-Eurasian mutual defense treaty? What would be left of the U.S. Empire without NATO, particularly given that the dollar would surely collapse before such a treaty were signed? The War Party in Congress has only one tool to work with, war, and when all you have is a hammer, all problems look like nails. Current U.S. military power is built around the capacity to wage two major wars concurrently, but is very heavily dependent on NATO to do so. I'm not sure at all that the War Party has what it takes to cope with a peaceful group boycott by other NATO members. 
Paul Merrell

U.S. urges allies to think twice before joining China-led bank - Yahoo Finance - 0 views

finance.yahoo.com/...taly-join-china-002209014.html

economic-warfare dedollarization AIIB Germany France Italy Luxembourg EC

shared by Paul Merrell on 20 Mar 15 - No Cached
  • (Reuters) - The United States urged countries on Tuesday to think twice about signing up to a new China-led Asian development bank that Washington sees as a rival to the World Bank, after Germany, France and Italy followed Britain in saying they would join. The concerted move by U.S. allies to participate in Beijing's flagship economic outreach project is a diplomatic blow to the United States and its efforts to counter the fast-growing economic and diplomatic influence of China. Europe's participation reflects the eagerness to partner with China's economy, the world's second largest, and comes amid prickly trade negotiations between Brussels and Washington.
  • European Union and Asian governments are frustrated that the U.S. Congress has held up a reform of voting rights in the International Monetary Fund that would give China and other emerging powers more say in global economic governance.
  • Washington insists it has not actively discouraged countries from joining the new bank, but it has questioned whether the Asian Infrastructure Investment Bank (AIIB) will have sufficient standards of governance and environmental and social safeguards. "I hope before the final commitments are made anyone who lends their name to this organization will make sure that the governance is appropriate," Treasury Secretary Jack Lew told U.S. lawmakers. Lew warned the Republican-dominated Congress that China and other rising powers were challenging American leadership in global financial institutions, and he urged lawmakers to swiftly ratify stalled reform of the IMF.
  • ...6 more annotations...
  • In a joint statement, the foreign and finance ministers of Germany, France and Italy said they would work to ensure the new institution "follows the best standards and practices in terms of governance, safeguards, debt and procurement policies." Luxembourg’s Finance Ministry confirmed the country, a big financial centre, has also applied to be a founding member of the $50 billion AIIB.
  • A spokeswoman for the European Commission, the EU's executive arm, endorsed member states' participation in the AIIB as a way of tackling global investment needs and as an opportunity for EU companies.
  • Lew told lawmakers that the U.S. delay in ratifying the agreement was undermining its credibility and influence as countries question the United States' commitment to international institutions. “It's not an accident that emerging economies are looking at other places because they are frustrated that, frankly, the United States has stalled a very mild and reasonable set of reforms in the IMF,” Lew said.
  • Some Republicans have complained the changes would cost too much at a time Washington is running big budget deficits. The reforms have also ran afoul of a growing isolationist trend among the party's influential Tea Party wing.
  • Washington says it sees a role for the IAAB given Asia's immense infrastructure needs and regards it as a potential partner for established institutions like the ADB. But its strategy of questioning the IAAB's standards has drawn criticism from some observers, who say the administration should have been more accepting of the new bank or offered alternatives within the existing institutions. "If you try to fight the rising power's peaceful ascent you sow big problems in the future," said Fred Bergsten, a former top international affairs official at the U.S. Treasury and currently a fellow at the Peterson Institute in Washington. Scott Morris, a former U.S. Treasury official who led U.S. engagement with the multilateral development banks during the first Obama administration, said Washington was paying the price for delay on IMF reform. "It's a clear sentiment among a pretty diverse group of countries: We would like to mobilize more capital for infrastructure through MDBs (multilateral development banks)," said Morris, now with the Washington-based Center for Global Development. "And the U.S. stands in the way of that and now finds itself increasingly isolated as a result.”
  • Japan, Australia and South Korea remain notable regional absentees from the AIIB. Australian Prime Minister Tony Abbott said at the weekend he would make a final decision on membership soon. South Korea has said it is still in discussions with China and other countries about possible participation. Japan is unlikely to join the AIIB, but ADB head Takehiko Nakao told the Nikkei Asian Review that the two institutions were in discussions and could work together.
  • Paul Merrell on 20 Mar 15
     
    Oh, man. Angela Merkel just hitched Germany's wagon to China's, which implictly means Russia's and the rest of BRICS too. Plus the European Commission, UK, France, Italy, and Luxembourg   Keep in mind that China will open its RMB trading centers in the major financial hubs in September and that the folks in Brussels are making noises about a European combined defense organization, independent of NATO anjd the U.S.   I want more information to be certain that there is more here than moves to create bargaining leverage with Washington, D.C.. but it might soon be time to buy a wheelbarrow to carry my walkabout spending money. Wow!
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