Perspectives on the global economic changes

Neshant · Post by **Neshant** » 01 Jun 2014 00:12

AbhiJ wrote: How should this be read w.r.t. French - US relations?

None. They already know what was going on.

The money is refunded to the France via the back door.

This is simply to deter other non-european countries from trading.

Neshant · Post by **Neshant** » 01 Jun 2014 09:02

Austin · Post by **Austin** » 01 Jun 2014 09:20

panduranghari wrote:Recent agreement between Russia-China to use local currency bypassing Dollar is perhaps another piece in the jig saw. Will Russia extend this gesture towards India? I hope he will.

They did say they are open to the idea of trading with China and India in local currency ..and within BRICS these two countries can have guranteed GDP growth of 5-6 % for many years to come.

Having said that we need to put our house in order first clean up the economic mess we are in and set for target growth of 8 % and reduce inflation. Once we get our ball rolling Rupee will gain its own strength and can be used for inter BRIC trading......Its just a matter of time this will happen it depends on us how early we want to get there by fixing our house.

chanakyaa · Post by **chanakyaa** » 02 Jun 2014 06:42

REMARKS BY PAUL A. VOLCKER AT THE ANNUAL MEETING OF THE BRETTON WOODS COMMITTEE WASHINGTON, DC – MAY 21, 2014
A NEW BRETTON WOODS???

http://www.brettonwoods.org/sites/defau ... ay2014.pdf

chanakyaa · Post by **chanakyaa** » 02 Jun 2014 06:57

(From The Diplomat)

Are China and Russia Moving toward a Formal Alliance?
Unlikely in the near future, but the U.S. should not make the strategic mistakes necessary to make it happen

http://thediplomat.com/2014/05/are-chin ... -alliance/

Austin · Post by **Austin** » 02 Jun 2014 13:24

^^ Not sure its the right thread to post it but there would be any Formal Military Alliance between China and Russia as Putin had stated some weeks back when asked the same question and his answer was Block Based Alliance are outdated.

China leading SCO and Russia leading CSTO are already co-operating in counter-terrorism related activities.

Where we might see an alliance is in Economic Field , China is the largest consumer of Energy and Russia has the largest reserves of Energy and pumps as much as Saudi does .....being border country its a win win thing as pipelines are cheaper way to transport gas/oil over Ships using LNG or Crude.

Another area for them to co-operate is trade in mutual currency and build up Gold Reserves to take care of future eventualities. Also Investement ,Trade and other Economic Activities.

Considering India and China is the only country that is guaranteed to grow above 5 % , Russia has a lot to gain in trading with these countries and at some point in time trade in Rupee/Yuan/Rouble that would be convenient to all three and gives option for other countries as well.

For eg just the China-Russia Gas deal is suppose to add 0.4 % GDP each year from 2015 onwards which is significant for Russia as its not suppose to grow beyond 3 % Russia-China gas deal may add 0.4% to GDP growth from 2015

panduranghari · Post by **panduranghari** » 02 Jun 2014 17:15

udaym wrote:REMARKS BY PAUL A. VOLCKER AT THE ANNUAL MEETING OF THE BRETTON WOODS COMMITTEE WASHINGTON, DC – MAY 21, 2014
A NEW BRETTON WOODS???

http://www.brettonwoods.org/sites/defau ... ay2014.pdf

Thanks for this great piece. Just shows how the power brokers think. Inspite of the misery heaped on the world, they still cannot own up to the cause of this problem. By all accords, except British and American, Bretton Woods 1945 was a massive failure. They dithered from implementing a equitable system and the price is there for everyone to see.

Some points;

1.The two words, “Bretton Woods”, still seem to invoke a certain nostalgia – memories of a more orderly, rule-based world of financial stability, and close cooperation among nations. Following the two disasters of the Great Depression and World War II that at least was the hope for the new International Monetary Fund, and the related World Bank, the GATT and the OECD.

How cute. Domination of the world financial system by WASPs was so nice.

2.Robert Triffen had persuasively pointed out the ultimate dilemma in building a monetary system and the provision of international liquidity on the base of a single national currency. The invention of the Special Drawing Rights was a response to that critique, but the limited provision of SDR’s and sense of commitment was not enough to suppress the spreading concerns.

Triffins Dilemma has a solution. It will be implented wheh USD fails.

3.The suspension of gold convertibility of the dollar as a transitional means of inducing the realignment, however controversial at the time, became inevitable.

Good. It allowed the east to rebuild their gold reserves.

4.The current travails of the Eurozone (the equivalent of an absolute fixed exchange rate regime) carry interesting lessons. A single currency with the free flows of funds among the member states simply could not substitute for the absence of a unified banking system and incentives for disciplined and complementary national economic policies.

Volcker may be god to many but he sees the world from his Keynesian prism. Time will prove he is wrong. There is no need for a unified banking system. A correct indicium is what you need. As i said time will prove things.

Austin · Post by **Austin** » 02 Jun 2014 21:48

QE At Work: Pouring Cheap Debt Into The Shale Ponzi

chanakyaa · Post by **chanakyaa** » 03 Jun 2014 06:40

(Source: Bloomberg) Ecuador Sends Gold Bricks to Goldman Sachs in Liquidity Hunt

http://www.bloomberg.com/news/2014-06-0 ... -hunt.html

Ecuador agreed to transfer more than half its gold reserves to Goldman Sachs Group Inc. for three years to give the government easier access to cash.

The central bank said it will send 466,000 ounces of gold to Goldman Sachs, worth about $580 million at current prices, and get the same amount back three years from now. In return, Ecuador will get “instruments of high security and liquidity” and expects to earn a profit of $16 million to $20 million over the term of the accord. The central bank didn’t detail additional terms of the transactions, such as any fees or financing costs paid to Goldman Sachs.

The deal comes as the South American country’s government, which defaulted on about $3.2 billion of bonds five years ago (the finance minister definitely deserves a medal), seeks to cover a budget deficit forecast by the Finance Ministry to swell to a record $4.94 billion this year. President Rafael Correa said in April he also planned to sell about $700 million of foreign debt this year in the country’s first international bond sale since the 2008 and 2009 default.

“Gold that was not generating any returns in vaults, causing storage costs, now becomes a productive asset that will generate profits,” the central bank said in the statement. “These interventions in the gold market represent the beginning of a new and permanent strategy of active participation by the bank, through purchases, sales and financial operations, that will contribute to the creation of new financial investment opportunities.”

Reserves Drop

Michael DuVally, a spokesman for New York-based Goldman Sachs, declined to comment. Central Bank President Diego Martinez didn’t respond to requests made through the bank’s press office seeking more information on the transaction.

The country’s gold reserves fell by $605 million, or 55 percent, to $493 million in the week ending May 23, according to a separate report on the central bank’s website. The bank, which was stripped of its autonomy in a 2008 constitutional referendum, had about 845,000 troy ounces of gold as of April 14, according to data compiled by Bloomberg.

Last year, Goldman Sachs proposed a swap with Venezuela to provide $1.68 billion in cash to be backed by $1.85 billion of that country’s gold, documents obtained by Bloomberg News showed.

The deal, which wasn’t completed, would have carried an interest rate of 7.5 percent plus the three-month London interbank offered rate. (holy $hit) Venezuela would have kept its exposure to gold, with the nation posting the precious metal or cash to a margin account if the price fell and Goldman Sachs posting U.S. dollars if it rose, the documents show.

Ecuador’s deal with Goldman Sachs is a signal the central bank is short on cash, Vicente Albornoz, the dean of the Universidad de las Americas business school in Quito, said in a telephone interview. The funds should help prop up government spending this year needed to drive economic growth.

“About the only thing that’s clear is that they’re converting part of their reserves into some sort of cash equivalent,” Albornoz said. “If the government doesn’t find funds to finance the deficit, it’ll have to cut spending.”

Austin · Post by **Austin** » 03 Jun 2014 09:34

So essentially they will just print paper and give it to Ecuador and in turn will buy half their gold , In the name of High Security and Liquidity

Neshant · Post by **Neshant** » 03 Jun 2014 20:45

What will be pushed is the IMF SDR with tight rules on countries to lock everyone into this system.

It will be promoted as a benefit to developing countries . But the reality is the west controls all major oil producers which makes the idea of any benefits incurred from paying for oil in SDR (partly local currency) just an illusion.

The only reason the G20 was formed was to promote the SDR central banker theft operation I suspect.

vishvak · Post by **vishvak** » 03 Jun 2014 21:07

So the Goldman Sachs prefer actual gold over paper gold. Well Ecuador govt can't complain since the Ecuador govt isn't a bank to understand details.

TSJones · Post by **TSJones** » 03 Jun 2014 22:55

Nobody is going to back Ecuador loans w/o collateral, not even you guys would be willing to do that after Ecuador defaulted on its bonds in 2008-2009. Goldman is willing to do it with collateral then more power to them. They are in the business of making a profit. This way, Ecuador can issue more bonds with Goldman underwriting them and Ecuador can make ssome money at it by using some of their gold as collateral. You can do this with practically any commodity as well as real estate. Standard business transaction.

chanakyaa · Post by **chanakyaa** » 04 Jun 2014 06:53

Nobody is going to back Ecuador loans w/o collateral, not even you guys would be willing to do that after Ecuador defaulted on its bonds in 2008-2009. Goldman is willing to do it with collateral then more power to them. They are in the business of making a profit. This way, Ecuador can issue more bonds with Goldman underwriting them and Ecuador can make ssome money at it by using some of their gold as collateral. You can do this with practically any commodity as well as real estate. Standard business transaction.

Most of what is said above is basic finance and can be argued as reasonable business transaction. So, no arguments there. But, we are not here to discuss basic finance on BRF. We hope to see under the hood, peel several layers and see underneath to the best of our abilities for Indics.

There is nothing wrong in what GS is doing. I would do the same. Exploiting incompetent borrower, loan sharking is an age old technique. Not developed by GS but definitely mastered by GS. No wonder, post 2008 crisis, Dodd-Frank included "ability-to-pay" rule to ensure that banksters do not exploit less savy borrowers (call them subprime or whatever) like Ecuador banana republics of the world. Between Gold (hard asset) and currency, hard asset can't be created out of thin air. There is real cost associated with it. Liquid asset, with respect to the discussion above, on the other hand is produced with little cost (i.e. interest rates held artificially low). If one can manage to fix Gold price, as in case of Barclays and many others while printing unlimited fiat currency, wallah, all problem are gone.

Gold Fix Study Shows Signs of Decade of Bank Manipulation

http://www.bloomberg.com/news/2014-02-2 ... ation.html

The London gold fix, the benchmark used by miners, jewelers and central banks to value the metal, may have been manipulated for a decade by the banks setting it, researchers say....

TSJones · Post by **TSJones** » 04 Jun 2014 07:32

udaym wrote:
Nobody is going to back Ecuador loans w/o collateral, not even you guys would be willing to do that after Ecuador defaulted on its bonds in 2008-2009. Goldman is willing to do it with collateral then more power to them. They are in the business of making a profit. This way, Ecuador can issue more bonds with Goldman underwriting them and Ecuador can make ssome money at it by using some of their gold as collateral. You can do this with practically any commodity as well as real estate. Standard business transaction.
Most of what is said above is basic finance and can be argued as reasonable business transaction. So, no arguments there. But, we are not here to discuss basic finance on BRF. We hope to see under the hood, peel several layers and see underneath to the best of our abilities for Indics.

There is nothing wrong in what GS is doing. I would do the same. Exploiting incompetent borrower, loan sharking is an age old technique. Not developed by GS but definitely mastered by GS. No wonder, post 2008 crisis, Dodd-Frank included "ability-to-pay" rule to ensure that banksters do not exploit less savy borrowers (call them subprime or whatever) like Ecuador banana republics of the world. Between Gold (hard asset) and currency, hard asset can't be created out of thin air. There is real cost associated with it. Liquid asset, with respect to the discussion above, on the other hand is produced with little cost (i.e. interest rates held artificially low)

The point of this is that Ecuador's GNP and governance there of, was unable to support its issuance of bonds for exchange of international currency, so they defaulted. That should be a point indics and non indics alike recognize; i.e. Ecuador screwed the pooch. In order to issue bonds in the future, which all countries must do because tax revenue is not steady year around, then a third party must be found to underwrite the bonds. Which obviously requires some sort of collateral. If ecuador pays back the bonds then they will get their gold back.

panduranghari · Post by **panduranghari** » 04 Jun 2014 17:31

Austin · Post by **Austin** » 05 Jun 2014 17:32

The ECB cut its benchmark rate from 0.25% to 0.15%

Rate reduction due to the threat of deflation in the euro zone, analysts say

Austin · Post by **Austin** » 05 Jun 2014 21:30

what is the significance of this move ?

ECB cuts deposit rate below zero in historic move

TSJones · Post by **TSJones** » 05 Jun 2014 21:36

Austin wrote:The ECB cut its benchmark rate from 0.25% to 0.15%

Rate reduction due to the threat of deflation in the euro zone, analysts say

the germans have played a tough game always thinking of erhardt in their banking philosophy. but what they forget is they also had the us army helping them at the same time so they could institute tough banking policies but still get us army spending. i've messaged a number of german citizens about this but they stil don't get it. now they are faced with deflation and minmum us army spending. if they don't act right now their products will be priced out of the market. we'll see if they acted in enough time.

Neshant · Post by **Neshant** » 06 Jun 2014 07:47

Austin wrote:what is the significance of this move ?

if it were me, I'd be taking all my money out of the bank in cash.

since banks are leveraged up, that would produce a huge margin call if many people did the same.

panduranghari · Post by **panduranghari** » 06 Jun 2014 13:18

Austin wrote:what is the significance of this move ?

ECB cuts deposit rate below zero in historic move

They are daring US fed to do the same. The fed is in between rock and a hard place.

What will be the consequence of decreasing interest rates?

Money will loose more value. It will force ppl to invest in something rather than keep money in the bank- which may increase the money flow. However M3 will lag behind in real time. Calls for increasing access to money wil be heard. A trickle will lead to a flow then a deluge. Ppl will want to buy best assets in this time.

I told you a couple of months back. ECB will want deflation to bite really hard before they intervene. Decrease in interest rates will make people complain. But ECB will carry on with their agenda of keeping inflation overall in eurozone below 2%. That is their mandate and they will stick to it.

However, USFed will have to react as money -Eurodollars- will move to US increasing the M3 into higher i flation zone

Austin · Post by **Austin** » 06 Jun 2014 14:09

Thanks for the response , Meanwhile

Renminbi use surges in home of US dollar

Neshant · Post by **Neshant** » 10 Jun 2014 20:22

Apparently the negative interest rate is only for banks depositing their reserves at the ECB. It is to encourage them to lend that money out.

The whole idea of free market capitalism has gone out the window with "wise men" sitting in ivory towers dictating what should happen to capital. The capital itself having been stolen from productive society through debauchery and transferred to their cronies the private banks.

panduranghari · Post by **panduranghari** » 11 Jun 2014 17:44

This is Crazy

The furnace-like roar to prevent financial immolation must move faster all the time. The Wall Street Journal reported in April that "Xie Daoliang's business survives by trading almost exclusively in a virtual currency, but not by choice. Mr. Xie makes bulldozer treads and other parts for heavy machinery. These days, when he makes a sale he seldom gets paid in cash. Instead, he gets a piece of paper with a value printed on it and a promise from a bank that it will pay at an arranged point in the future. In China's economic slowdown, businesses are having troubles paying suppliers, and banks are getting shy about lending, so cash is scarce. The notes-a form of IOUs known as acceptance drafts - are increasingly being used instead, and Mr. Xie says they really get around... 'At the moment, there's no cash. It's all just bills,' says Mr. Xie... 'It's unreasonable.' Acceptance drafts, which are similar to postdated checks but are guaranteed by a bank or state-owned enterprise, have been a fixture of trade in China for years. But corporate treasurers, chief financial officers, people at small loan firms and analysts say that as the economy slows, cutting into companies' sales, the bills are being passed around more and more. Driving the exchange of paper, analysts say, is an unwillingness, or inability, by banks to meet demand for cash loans, especially from smaller companies. 'The credit transmission mechanism is breaking, or even broken,' said Leland Miller, president of the China Beige Book, a quarterly survey of Chinese businesses and banks. 'Firms are having a difficult time getting access to funding, and for small firms it's extraordinarily difficult.'"

This is close to deflation as possible. However, the deflation always leads to hyperinflation.

Understand these 2 posts;

http://www.financialsensearchive.com/fs ... /0212.html
http://www.financialsensearchive.com/fs ... /0318.html

Fallacy One. The belief that a “dollar” is a “dollar” and that the deflationary history of gold standard currencies applies to symbolic currencies (an “apples to oranges” fallacy).
Fallacy Two. The belief that the US Great Depression proves the case for unstoppable monetary deflation during depressions, when it in fact proves that a sufficiently determined government can immediately break monetary deflation at will, even in the midst of depression.
Fallacy Three. The belief that inflation and deflation take wealth from all of us equally, when what they actually do is redistribute the wealth among us.
Fallacy Four. The widespread belief that Japan experienced powerful price deflation that the government was powerless to fight. It didn’t.
Fallacy Five. The fundamental mistake of thinking that “deflation” is “deflation”, which leads to confusing price deflation with asset deflation, and means missing the real lessons and dangers of what happened in Japan, which is the persistent asset deflation that has defeated all government interventions (another “apples to oranges” fallacy).
Fallacy Six. The dangerous belief that deflation protects you from inflation. More specifically, the vocabulary confusion that leads to the belief that asset deflation protects you from monetary inflation, or that the destruction of the value of your assets is somehow historically proven to protect the value of your money.

Austin · Post by **Austin** » 12 Jun 2014 11:29

The End Of US Economic Dominance: Nails In The Dollar-Standard's Coffin

Mike Maloney (of The Hidden Secrets of Money) has demonstrated that that every 30-40 years the world has an entirely new global monetary system, that the current monetary system (the U.S. dollar standard) is aging and becoming unstable, and, just like the previous monetary systems, will soon implode. The following wide-ranging clip shows that the "Nails in the Coffin of the Dollar Standard" are now coming faster and are more furious than ever before. He believes that there will be a global currency crisis before the end of this decade and that the days of the dollar standard are numbered. This will lead to a massive deflation followed by an overnight devaluation of the dollar and huge overnight revaluation of gold, and, though it will be painful for most, it is the greatest opportunity in history for those who are prepared.

panduranghari · Post by **panduranghari** » 12 Jun 2014 17:42

^^^^I hope more people watch this. Especially those of limited means.

The K winter approaches as Maloney says.

link
According to Harry Dent, "You need to prepare for that crisis, which will occur between 2014 and 2023, with the worst likely starting in 2014 and continuing off and on into late 2019."

Charles Nenner Research (source)
Stocks should peak in mid-2013 and fall until about 2020. Similarly, bonds should peak in the summer of 2013 and fall thereafter for 20 years. He bases his conclusions entirely on cycle research. He expects the Dow to fall to around 5,000 by 2018 – 2020.

Kress Cycles (Clif Droke) (source)
The major 120 year cycle plus all minor cycles trend down into late 2014. The stock market should decline hard into late 2014.

Elliott Wave (Robert Prechter) (source)
He believes that the stock market has peaked and has entered a generational bear-market. He anticipates a crash low in the market around 2016 – 2017.

Market Energy Waves (source)
He sees a 36 year cycle in stock markets that is peaking in mid-2013 and will cycle down for 2013 – 2016. “… the controlling energy wave is scheduled to flip back to negative on July 19 of this year.” Equity markets should drop 25 – 50%.

Armstrong Economics (source)
His economic confidence model projects a peak in confidence in August 2013, a bottom in September 2014, and another peak in October 2015. The decline into January 2020 should be severe. He expects a world-wide crash and contraction in economies from 2015 – 2020.

Cycles per Charles Hugh Smith (source)
He discusses four long-term cycles that bottom in the 2010 – 2020 period. They are: Credit expansion/contraction cycle, Price inflation/wage cycle, Generational cycle, and Peak oil extraction cycle.

Harry Dent – Demographics (source)
Stock prices should drop, on average, for the balance of this decade, perhaps as low as 3,300 on the Dow Jones Industrial Average. Demographic cycles in the United States (and elsewhere) indicate a contraction in real terms for most of this decade.

Sun Spot Cycles
They are due to peak in the summer of 2013 and decline into 2019. Market tops often occur at or near peaks in sun spots. This is an approximate 10 – 13 year cycle. Economic and political upheavals tend to occur at or near the peak of sun spot cycles.

Lucky 13
1987, 2000, and 2013 marked stock market highs, all 13 years apart.

War Cycles

Larry Edelson (source)
His research shows that the world-wide tendency to fight major wars rises and falls over time. He currently projects a peak about 2020 with rising war fever from 2013 until 2020. There is no shortage of possible war zones. As conditions worsen during the balance of this decade, nations will be inclined to distract and control their populace via wars, increased government control, and management of the economy.

Long-Term War Cycles
1780, 1860, 1940, 2020? About every 80 years there has been a major war involving the United States.

Gold & Silver

Jim Sinclair (source)
He expected a major low in gold price cycles in March or April of 2013; however, June provided an even lower low. He still expects gold to rally much higher from here. “Gold is going to and through $3,500 in the not too distant future.” He has decades of experience in the markets and has successfully understood and traded gold since the 1970s.

Alf Field (source)
He uses Elliott Wave theory to analyze gold. His first major target for gold is $4,500, for Intermediate wave III of MAJOR THREE. Wave IV will be a correction and wave V will take gold much higher thereafter.

Charles Nenner Research
He expects gold to bottom about now and rally substantially from here. He called the top in gold two years ago. He called for a bottom about now in the $1,300s. He expects a large rally that lasts several years.

Larry Edelson
He projects a low for gold in June 2013 followed by a substantial rally until about 2020, possibly to $10,000.

Armstrong Economics
Gold is likely to be weak until after October 2015 and then move strongly higher into January 2020. Gold will rise primarily due to the collapse of paper currencies in the period from 2015 – 2020.

Other Cycles

Comet ISON
This comet will be visible in October and November 2013 – it is expected to be the brightest comet in years, perhaps many decades. Highly visible comets often indicate sudden changes in leadership, political systems, and financial systems. Possible changes include the failure or redesign of the Euro, a dollar crash, assassination of a major leader, impeachment, derivative implosion, martial law, international war, and a major economic default.

JR Nyquist on global cooling and food production (source)
He discusses long-term solar output cycles. He anticipates that an approximately 200 year cycle in solar output will reduce average temperatures, available water, and crop yields. He expects higher food prices and famine during the next decade. The last cold cycle low was around the time Napoleon marched into Russia.

100 year anniversaries
1913 was an important year. It marked the beginning of the Federal Reserve and the income tax in the US. 2013 has already shown that essentially all digital communications and internet activity are tracked and recorded by the government. It has also marked the authorization for military control and martial law in the United States. Further, bank account and brokerage confiscations (bail-ins) have already occurred; and more “bail-ins” are likely. 2013 could mark the beginning of what might evolve into WWIII – starting in the Middle East.

Austin · Post by **Austin** » 13 Jun 2014 08:11

Oil Is Rising on Iraq crisis
http://oil-price.net/

WTI $106.53
Brent Crude $113

Austin · Post by **Austin** » 14 Jun 2014 09:47

U.S. Economy’s First-Quarter Contraction Could Be Even Worse Than You Thought

chanakyaa · Post by **chanakyaa** » 14 Jun 2014 18:01

Oil Is Rising on Iraq crisis
http://oil-price.net/

WTI $106.53
Brent Crude $113

In my view, the oil price manipulation is indirect taxation, without hell any representation, on the developing economies. They are paying with their thollar savings. Pitrothollar recycling on a fast track. The major difference between Beetish colonialism and New World colonialism is that, Beetish physically occupied the country, imposed, demanded, and collected taxes. New rulers do it do it using currency, without occupying territory (they learned from from Beetish experiment that occupation is unpopular. Indirect taxation is very efficient but difficult to understand)

Neshant · Post by **Neshant** » 15 Jun 2014 04:24

The Chinese-Russian yuan-ruble agreement on energy exports is an attempt to break this hegemony.

India needs to find a way out as well but has nothing near the amount of goods that China has to entice oil exporters to take their currency as payment.

Austin · Post by **Austin** » 15 Jun 2014 14:11

Neshant wrote:The Chinese-Russian yuan-ruble agreement on energy exports is an attempt to break this hegemony.

India needs to find a way out as well but has nothing near the amount of goods that China has to entice oil exporters to take their currency as payment.

India can have a Rupee-Rouble Oil Deal if we can get a long term Oil and Gas Deal like China did ..the Russians are more than keen to move away from USD/Euro for Oil Transaction and many Russian Economist have mentioned Yuan and Rupee to be added to Oil basket.

I dont see Russia relation with West getting any better medium term and its an opportunity for us to get a deal with Russians , would be benefetial for both with Russia moving its Oil/Gas Trade from being Euro Centric to Asia Centric which is where the growth will happen in next 2 decade and Indian Rupee and Economy getting a boost from such trade.

Neshant · Post by **Neshant** » 16 Jun 2014 00:26

Russia may want yuans but I doubt they want rupees.

With yuans they have lots of consumer goods to purchase from China.

With Rupees, there is not much they can get from India because it produces hardly anything they need.

chanakyaa · Post by **chanakyaa** » 17 Jun 2014 05:15

Argentine Bonds Plunge After U.S. Court Rejects Appeal

How does Argentina manage to default again??

The most important question is the following...
What is this case doing in the U.S. courts?

For Argentina, it’s the price of doing business. The country has defaulted seven times since gaining independence from Spain in 1816. Needing to reassure wary investors, the country agreed in its bond contacts that New York law would govern the provisions and any disputes would be adjudicated in New York courts....

in article http://www.bloomberg.com/news/2014-06-1 ... t-q-a.html

Austin · Post by **Austin** » 17 Jun 2014 08:05

Total US debt soars to nearly $60 trn, foreshadows new recession

America - its government, businesses, and people - are nearly $60 trillion in debt, according to the latest economic data from thethe St. Louis Federal Reserve. And private debt - not government borrowing - is the biggest reason for the huge deficit.

Total US debt at the end of the first quarter of 2014, on March 31 totaled almost $59.4 trillion - up nearly $500 billion from the end of the fourth quarter of 2013, according to the data. Total debt (the combination of government, business, mortgage, and consumer debt) was $2.2 trillion 40 years ago.

“In 50 short years, debt has gone from being a luxury for a few to a convenience for many to an addiction for most to a disease for all,” James Butler wrote in an Independent Voters Network (IVN) op-ed. “It is a virus that has spread to every aspect of our economy, from a consumer using a credit card to buy a $0.75 candy bar in a vending machine to a government borrowing $17 trillion to keep the lights on.”

According to a 2012 study published in the Economist, rapid growth in private debt is a better predictor of recessions than increases in public debt, growth in money supply, or trade imbalances. Consumer credit in the US rose by 22 percent over the last three years, reaching a record-high $3.18 trillion in April, the Fed reported on Friday.

Credit card use (or revolving credit) rose by $8.8 billion, while non-revolving credit like auto loans and student loans made by the government surged up by $18 billion in April. Non-revolving credit jumped by 8.2 percent over the last year, while revolving credit only rose 2.2 percent over the same time period.

“For a while after the recession it was trendy to cut up your credit cards and get out of debt,” Michael Snyder wrote in an InfoWars op-ed. “But that fad wore off rather quickly, didn’t it?”

Snyder noted that 56 percent of all Americans have a subprime credit rating, and that the average monthly car payment in the US is $474. He added that 52 percent of homeowners are overextended on their mortgages and “cannot even afford the house that they are living in right now.”

Debt is hurting young adults the most. Millennials say they are spending at least half their monthly paychecks on paying off debt, a recent Wells Fargo survey found. And two years out of college, half of all graduates are still relying on their parents or other family members for some sort of financial help, according to a University of Arizona study, which also found that only 49 percent of graduates are working full-time.

"Whether or not a weak labor market is increasing the need for intergenerational support -- a likely driver in today's economy -- our data clearly showed that many young adults today may not be earning enough to make it on their own, even when working full time," the report stated.

Most of the debt that young adults face is student loan debt, which totals more than $1.2 trillion, according to the Federal Reserve. Of that debt, approximately $124 billion is more than 90 days delinquent.

“What we have done to our young people is shameful. We have encouraged them to sign up for a lifetime of debt slavery before they even understand what life is all about,” Snyder wrote.

The Congressional Budget Office predicts that the economy will stall by 2017 because Americans will continue spending, but wages and wealth won’t be going up - leading to increased income inequality in the country, the Guardian reported.

“That ever-increasing gap between income and consumption has been filled by borrowing,” the Guardian said. “These were the debt dynamics in the lead-up to the recession. But they are also the dynamics leading out of the crisis, and continuing today with no end in sight.”

Economists have not agreed on how to stave off the impending crisis. But Americans’ addiction to spending on credit will not help.

“The problem is, the more debt we have, the more future income must be used to pay the debt and its interest, which reduces the money we have to spend on things. This works to slow the economy,” Butler wrote.

“Eventually, the negative effect of the debt load becomes stronger than the positive effect of the added spending and a recession is triggered — or worse.”

Austin · Post by **Austin** » 17 Jun 2014 09:00

Neshant wrote:Russia may want yuans but I doubt they want rupees.

With yuans they have lots of consumer goods to purchase from China.

With Rupees, there is not much they can get from India because it produces hardly anything they need.

As of Today yes but we are not looking at 100 % payment of Rupee instead of USD/Euro.

We can always start from 10-20 % in Rupee-Rouble payment and gradually over period of years increase in volume.

10 Years from now Indian Economy would be on a qualitatively different level and probably with Rupee you can purchase a lot of consumer goods from India.

Even the Chinese didnt start yesterday , There was some initiative in Rouble-Yuan trade which lead to bigger deals every year.

panduranghari · Post by **panduranghari** » 17 Jun 2014 19:16

udaym wrote:Argentine Bonds Plunge After U.S. Court Rejects Appeal

How does Argentina manage to default again??

The most important question is the following...
What is this case doing in the U.S. courts?

For Argentina, it’s the price of doing business. The country has defaulted seven times since gaining independence from Spain in 1816. Needing to reassure wary investors, the country agreed in its bond contacts that New York law would govern the provisions and any disputes would be adjudicated in New York courts....

in article http://www.bloomberg.com/news/2014-06-1 ... t-q-a.html

The jews are punishing Argies for giving asylum to the Nazi folks who escaped and for waging war with Britain over Falklands.

However, Over decades, the resources of Argentina were stolen from its people by the corrupt government enabling the centralized ownership of capital outside of the country. In a free market, capital resources will never become so centralized because they are most efficiently and profitably used when deployed in service to their regional populace. Only with the help of a corrupt government can capital ownership become so centralized (and separated from reality) that people end up dying.

My secretary who lived in Argentina talks about the horrors. She and her 2 tiny children were bound, gagged and were burgled while her Husband was out.

Capitalism in practice is the most efficient use of capital resources as directed by the free market through the invisible hand described by Adam Smith, protected but unencumbered by government. In the case of Argentina, its previous socialist state ownership of its most valuable resources was far closer to real capitalism than the private ownership by global corporations which the corrupt government enabled. This caused the highly inefficient neglect and ultimate destruction of local capital resources for the enrichment of corrupt politicians and the global conglomerates in far-away lands they assisted. I think ArthaKranti can achieve that.

This was also enabled by the centralized monetary and debt system of the international US dollar reserve system and the International Monetary Fund.

In Argentina, this culminated in economic, monetary, and political collapse beginning in late 2001. We, the rest of the world, are at the very beginning stages of this same collapse.

Solution to the problem - We do not need a New World Order and a single global currency. That would be centralization in the WORST way. We need all regional currencies only in competition with Gold as a wealth reserve. Public debts which were taken on in the name of the many but only benefited the few should either be written off or else charged to the few that benefited if they can be identified. This will be the result anyway, in the case of political failure. Corrupt and misguided politicians can only keep such a flawed system going if they remain in power.

Neshant · Post by **Neshant** » 18 Jun 2014 07:27

From what I've heard, Argentina is sitting on one of the largest off shore oil fields ever found.

If so, they should be in the black just a few years from now.

Also uncle wants to take control of that country as it did with Eye-rack and Lib-YA.

abhishek_sharma · Post by **abhishek_sharma** » 18 Jun 2014 07:40

Does He Pass the Test? Paul Krugman

Stress Test: Reflections on Financial Crises
by Timothy F. Geithner
Crown, 580 pp., $35.00

panduranghari · Post by **panduranghari** » 18 Jun 2014 18:00

Neshant wrote:From what I've heard, Argentina is sitting on one of the largest off shore oil fields ever found.

If so, they should be in the black just a few years from now.

Also uncle wants to take control of that country as it did with Eye-rack and Lib-YA.

Then its in Argetinas interest that the oil stays below ground. Otherwise we know what will happen.

panduranghari · Post by **panduranghari** » 18 Jun 2014 19:15

abhishek_sharma wrote:Does He Pass the Test? Paul Krugman

Stress Test: Reflections on Financial Crises
by Timothy F. Geithner
Crown, 580 pp., $35.00

Wow. Just f wow. Krugman is trying to blame his chums for QE not working. Wasnt he calling for QE (which he confirmed in the above post - He wanted 400b$ per year instead of 800b$ over a few years.)