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Yes, the impact on the holders of debt by the sovereigns, is the first order effect, isn't it? What is the second order effect? Budgetary adjustment is only a small part of the equation. At the end of the day, the holders of Euro currency outside of Eurozone will end up subsidizing the Grexit. Higher living standards in Europe must mean transfer of wealth from developing nation to developed nations, no?If there is s Grexit, i.e. exit of Greece from Euro, then unlike last time the disproportionate burden will be shared by the Greeks and the sovereigns of Euro Zone and EU who have lent money to Greece. There are very few private investors of Greece public debt left. Most of them have moved on. In case of EU governments who have given money to Greece, this will entail budgetary adjustments.
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We asked him where he thought the gold price will be in five years and he said “measurably higher.”
In private conversation I asked him about the outstanding debts… and that the debt load in the U.S. had gotten so great that there has to be some monetary depreciation. Specially he said that the era of quantitative easing and zero-interest rate policies by the Fed… we really cannot exit this without some significant market event… By that I interpret it being either a stock market crash or a prolonged recession, which would then engender another round of monetary reflation by the Fed.
He thinks something big is going to happen that we can’t get out of this era of money printing without some repercussions – and pretty severe ones – that gold will benefit from.
India can continue using what ever USD that remains in it's hand.Christopher Sidor wrote:Not feasible. They have no money. It is like India using USD as its currency, defaulting on its sovereign debt and then still saying that India will continue to use USD. Where will India get USD?
USD = US Dollar.
Thats exactly is what is called 'exorbitant privilege'. You have found out the cause of the problem. And the problem is not Euro. The problem is dollar which suffers from Triffins Dilemma. Euro eventually frees us to pursue the personal choices which Dollar has never allowed us to. Interesting times.udaym wrote:Yes, the impact on the holders of debt by the sovereigns, is the first order effect, isn't it? What is the second order effect? Budgetary adjustment is only a small part of the equation. At the end of the day, the holders of Euro currency outside of Eurozone will end up subsidizing the Grexit. Higher living standards in Europe must mean transfer of wealth from developing nation to developed nations, no?If there is s Grexit, i.e. exit of Greece from Euro, then unlike last time the disproportionate burden will be shared by the Greeks and the sovereigns of Euro Zone and EU who have lent money to Greece. There are very few private investors of Greece public debt left. Most of them have moved on. In case of EU governments who have given money to Greece, this will entail budgetary adjustments.
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If by quantum you mean actual size/number , the off my head I remember Chinese Debt is around $23 trillion and US its around $60 trillion.ramana wrote:Austin, Also helps is we know the quantum of debt?
IndiaChina accounting for 10.7 MMbbl/d of the total increase. As China's economy moves from dependence on energy-intensive industrial manufacturing to services, the transportation sector becomes the most significant source of growth in liquid fuels use, and the country's liquid fuels consumption more than doubles from its 2010 level. In the Reference case, China replaces the United States as the world's largest consumer of liquid fuels by 2035 (Figure 7).
Compare to what Russia Energy Minister says about Domestic Oil ProductionThe gap between India’s oil demand and supply is widening, as demand reached nearly 3.7 million barrels per day (bbl/d) in 2013 compared to less than 1 million bbl/d of total liquids production. EIA projects India’s demand will more than double to 8.2 million bbl/d by 2040
525 million tons corresponds to roughly ~ 10 million bbl/d by 2035Energy Strategy of Russia until 2035 is not intended to reduce the volume of oil production, but change the structure of production in the region. This was reported by the TV channel "Russia 24" Russian Energy Minister Alexander Novak.
"We do not expect a decline in production, they will be at the level of 525 million tons of oil by 2035," - he said.
MOSCOW, March 2. /TASS/. The Russian Ministry of Finance expects the $30 billion capital outflow in Q1, Finance Minister Siluanov said on Monday.
"Concerning the capital outflow, we expect it as totaling about $30 billion in the first quarter and $90-100 billion in annual terms. This is slightly lower than our assumption in the outlook, which was equal to $120-130 billion," the minister said. The said figure covers $60-70 billion of foreign debt repayments, Siluanov added.
One of the proposals in the letter sent by Finance Minister Yanis Varoufakis to Greece’s international creditors was the use of students, housekeepers, and even tourists to serve as undercover tax inspectors. He said that they could be paid an hourly rate “on a strictly short-term, casual basis” for no more than two months.
“The very ‘news’ that thousands of casual ‘onlookers’ are everywhere, bearing audio and video recording equipment on behalf of the tax authorities, has the capacity to shift attitudes very quickly,” wrote Mr Varoufakis in the 11-page letter, sent on Thursday to Eurogroup Chief Jeroen Dijsselbloem, the eurozone’s chief negotiator, and obtained by the Financial Times.
Financial Times reports that the reaction from eurozone officials to the tourist plan was received with humor. They thought the proposal was hilarious and even laughed when they read it. “It’s quite hilarious, if it were not so tragic, that this is what a government in an industrialised country comes up with,” said one eurozone official involved in the talks.
Chinese reaction:
The Chancellor of the Exchequer, George Osborne said:
I am delighted to announce today that the UK will be the first major Western country to become a prospective founder member of the Asian Infrastructure Investment Bank, which has already received significant support in the region.
This government has actively promoted closer political and economic engagement with the Asia-Pacific region and forging links between the UK and Asian economies to give our companies the best opportunity to work and invest in the world’s fastest growing markets is a key part of our long term economic plan. Joining the AIIB at the founding stage will create an unrivalled opportunity for the UK and Asia to invest and grow together.
American reaction and some analysis:"China welcomes the decision of the British side," the Chinese Finance Ministry said.
The White House statement reads: “This is the UK’s sovereign decision. We hope and expect that the UK will use its voice to push for adoption of high standards.”
Why did the US pick a fight? Why did they decide to public air their grievances after the fact, which will do nothing to change the facts on the ground but will surely damage US-UK relationships? Has to be the work of the foreign policy prodigy Mr. Barak Obama again. Could SK and Australia follow suit? They've been teetering on the fence for a while now. The deadline to becoming a founding member is March 31st, which is coming right up. Seems like China and India are really one-upping the US this round. I suppose that's what you get when you don't give developing countries their share of say in the IMF and the WB.“I think the US has had its questions about the UK posture towards China on other issues and I suppose this announcement probably triggered renewed concern in Washington about overall British politics vis-à-vis China. But [we] don’t normally arbitrate these things in public and I’m a little unsure as to why the US has chosen to pick a fight with the UK on this bank at this time, because I thought it had somewhat softened its posture on the bank. It’s a bit surprising to me,” said Matthew Goodman, senior adviser for Asian economics at the Center for Strategic and International Studies.
Hopefully, BRICS bank will consider that too while making policies - so as to give preference to BRICS countries and even out any unfairness elsewhere, for example IMF.Austin wrote:US have stalled IMF reforms for many years now and dont want to give BRICS economy their valid shares in the IMF.
Analysts point out that European countries, which continue to dominate the IMF’s board of directors and stand to lose the most clout under the reforms, have been happy to let the U.S. block the legislation even while publicly deploring the congressional delays. While American voting power would be mostly undiluted under the reforms, the greater power given to emerging countries would come largely at the expense of smaller European countries that would lose voting shares.
(Reuters) - International Business Machines Corp is considering adopting the underlying technology behind bitcoin, known as the "blockchain," to create a digital cash and payment system for major currencies, according to a person familiar with the matter.
The objective is to allow people to transfer cash or make payments instantaneously using this technology without a bank or clearing party involved, saving on transaction costs, the person said. The transactions would be in an open ledger of a specific country's currency such as the dollar or euro, said the source, who declined to be identified because of a lack of authorization to discuss the project in public.
The blockchain - a ledger, or list, of all of a digital currency's transactions - is viewed as bitcoin's main technological innovation, allowing users to make payments anonymously, instantly, and without government regulation.
Rather than stored on a separate server and controlled by an individual, company, or bank, the ledger is open and accessible to all participants in the bitcoin network.
The proposed digital currency system would work in a similar way.
"When somebody wants to transact in the system, instead of you trying to acquire a bitcoin, you simply say, here are some U.S. dollars," the source said. "It's sort of a bitcoin but without the bitcoin."
IBM is one of a number of tech companies looking to expand the use of the blockchain technology beyond bitcoin, the digital currency launched six years ago that has spurred a following among investors and tech enthusiasts.
The company has been in informal discussions about a blockchain-tied cash system with a number of central banks, including the U.S. Federal Reserve, the source said. If central banks approve the concept, IBM will build the secure and scalable infrastructure for the project.
IBM media relations office did not respond to Reuters emails about this story and the Fed declined to comment.
However, there are signs that central banks are already thinking about the innovations that could arise through digital currency systems. The Bank of England, in a report in September 2014, described the blockchain's open ledger as a "significant innovation" that could transform the financial system more generally.
Instead of having ledgers maintained by banks that act as a record of an individual's transactions, this kind of open ledger would be viewable by everyone using the system, and would use an agreed-upon process for entering transactions into the system.
The project is still in the early stages and constantly evolving, the source said. It is also unclear how concerns about money-laundering and criminal activities that have hamstrung bitcoin.
Unlike bitcoin, where the network is decentralized and there is no overseer, the proposed digital currency system would be controlled by central banks, the source said.
"These coins will be part of the money supply," the source said. "It's the same money, just not a dollar bill with a serial number on it, but a token that sits on this blockchain."
According to the plans, the digital currency could be linked to a person's bank account, possibly using a wallet software that would integrate that account with the proposed digital currency ledger.
"We are at a tipping point right now. It's making a lot more sense for some type of digital cash in the system, that not only saves our government money, but also is a lot more convenient and secure for individuals to use," the source said.
I smelt a rat when France and Germany were inviting India & China to take a bigger share in the IMF by increasing their funding. It was pitched as a great opportunity but I knew it was a trap. China put 40 billion in and India 10 billion.Austin wrote:Well Europe/US does not want to give voting right because they want to use IMF and World Bank as an extended means of Political and FP.
Its a good tool to enslave nation with debt they cannot pay or bankrupt them if required or dictate budget policy.
A person on benefits with 4 kids from 4 different men living in a trailer park in some non de script US town has better standard of living than many educated middle class in the rest of the world.DavidD wrote:1.4 billion people in Asia without access to electricity, almost double that number without access to sanitation. That's simply unacceptable in the 21st century. Any help the Asian countries can get is welcomed, even better if it mostly originates from Asia itself.
Per latest reports, it seems like Australia and SK are preparing to conditionally sign on to the AIIB as well.
Well, we need to have a particular understanding that world is not fair. 10 Billion $ worth of investment and yet we are not much closer to fair share...
Clever way of passing some of German & French bad bank loans onto India & China.
India could have done some foreign direct investment in Greece with that money instead of channeling it through the IMF mafia.
Thanks for the stereotyping but Caucasian women in the US who have four children are few and far between. Never mind with a different father for each child. The average number of children per white woman is 1.5, meaning we're not replacing ourselves. not even close. By 2030 or a little thereafter, there will more "minority" children in public schools than white children. Also I don't know where you get your information, but due to automation and foreign outsourcing of manufacturing jobs, the working poor and lower middle class have been left behind economically for *decades*. In fact, Walmart, Target and other discount stores plus McDonald's have seen their sales stalemate if not out right plummet. There is no growing demand for cheap Chinese goods anymore. The working poor and the lower middle class simply don't have the money. There is barely any demand in the US but it's better here in the US than Europe because of the sub-genius leaders of the ECB.panduranghari wrote:A person on benefits with 4 kids from 4 different men living in a trailer park in some non de script US town has better standard of living than many educated middle class in the rest of the world.DavidD wrote:1.4 billion people in Asia without access to electricity, almost double that number without access to sanitation. That's simply unacceptable in the 21st century. Any help the Asian countries can get is welcomed, even better if it mostly originates from Asia itself.
Per latest reports, it seems like Australia and SK are preparing to conditionally sign on to the AIIB as well.
To say US has an interest in raising the standard of life for the rest of the world is down right factitious.
IMO, USA should be kept out of any initiative which we hope should succeed. The demise of US will be associated to AUTOMATIC improvement in standard of life in ROW esp. The developing world. Why? Because if ROW improves the standard of life,the American trailer park residents will pay the price.
Can USA afford this?
Just saying. Mr. Clean MMS did give $10b to IMF.vishvak wrote:Well, we need to have a particular understanding that world is not fair. 10 Billion $ worth of investment and yet we are not much closer to fair share...
Clever way of passing some of German & French bad bank loans onto India & China.
India could have done some foreign direct investment in Greece with that money instead of channeling it through the IMF mafia.
panduranghari wrote:A person on benefits with 4 kids from 4 different men living in a trailer park in some non de script US town has better standard of living than many educated middle class in the rest of the world.DavidD wrote:1.4 billion people in Asia without access to electricity, almost double that number without access to sanitation. That's simply unacceptable in the 21st century. Any help the Asian countries can get is welcomed, even better if it mostly originates from Asia itself.
Per latest reports, it seems like Australia and SK are preparing to conditionally sign on to the AIIB as well.
To say US has an interest in raising the standard of life for the rest of the world is down right factitious.
IMO, USA should be kept out of any initiative which we hope should succeed. The demise of US will be associated to AUTOMATIC improvement in standard of life in ROW esp. The developing world. Why? Because if ROW improves the standard of life,the American trailer park residents will pay the price.
Can USA afford this?
TSJ and others..In response to above TSJones wrote:
Thanks for the stereotyping .... Also I don't know where you get your information, ....
New Delhi: Pressed by the government for a greater say, the International Monetary Fund (IMF) on Monday promised to look into alternatives to make the country a top ten shareholder as the US was "not ratifying" the quota reforms at the multilateral lending agency.
In a meeting with IMF chief Christine Lagarde, who is on a two-day India visit, Finance Minister Arun Jaitley pitched for early implementation of IMF quota reforms to give a more say to emerging economies like India.
Ms Lagarde, who also called on President Pranab Mukherjee and met Prime Minister Narendra Modi, emphasised that IMF is a global multilateral institution where countries like India must have a bigger say.
"Finance Minister Arun Jaitley during his meeting with IMF Managing Director Christine Lagarde called for early implementation of the 2010 IMF quota and governance reform," an official statement quoted him as saying.
Earlier in the day, the IMF chief said in a lecture at a college here that the US is "not ratifying" the quota reforms that would facilitate larger roles of emerging economies at the multilateral institution.
The IMF is looking at alternatives to realign quotas that will put India into the top 10 shareholders, she said.
How will you pay for groceries or gasoline in the future? According to Kabir Sehgal, author of the new book “Coined,” it might not be the old familiar greenback. As technology advances, so do currencies and payment systems.“Look at Amazon (AMZN) points, Starbucks (SBUX) points. These are effectively the new currencies,” he says. “There are more frequent flyer miles in circulation than dollars, so it's one of the biggest currencies in the world.”Sehgal believes that the future of money may involve the linking of corporate currencies.“What if you could go in a taxi and pay with your Starbucks points, or go to Starbucks and pay with Amazon points?” he says. “So effectively you can link up all these corporations and create one unified corporate currency, and it may be very user-friendly.”He also thinks that mobile phones will likely become the payment device of the future. In recent years Apple Pay (AAPL), Google Wallet (GOOGL), and M-Pesa have been created to facilitate these transactions.“So increasingly the mobile phone can be the way to pay for items and increase speed in a store,” he says. “Starbucks for example, is it quicker to pay with a mobile phone? Sure, the line will go faster and it's better for consumers, better for Starbucks.”
As for digital currencies, such as Bitcoin, Sehgal thinks it’s unlikely they will gain traction as an alternative to the U.S. dollar. He points out that the U.S. government still maintains the ultimate power to determine what is a currency. Importantly, taxes in the U.S. can only be paid in U.S. dollars.
“I think what we're seeing now is the Bitcoin will thrive as a technology, not necessarily as a currency,” he says. “Bitcoin is way to transfer files in authenticated manner. That technology will remain and flourish.”Sehgal says it isn’t illegal to create currency, noting that both Philadelphia and Ithaca created their own local currencies in the 1990s as a way to stimulate economic activity.America has a long history of using many different currencies. “If you look at the Civil War, there are 8,000 currencies in United States circulating throughout America,” Sehgal points out.