From Forbes Magazine this week,
The Federal Reserve's Explicit Goal: Devalue The Dollar 33%
"The Federal Reserve Open Market Committee (FOMC) has made it official: After its latest two day meeting, it announced its goal to devalue the dollar by 33% over the next 20 years. The debauch of the dollar will be even greater if the Fed exceeds its goal of a 2 percent per year increase in the price level."
"An increase in the price level of 2% in any one year is barely noticeable. Under a gold standard, such an increase was uncommon, but not unknown. The difference is that when the dollar was as good as gold, the years of modest inflation would be followed, in time, by declining prices. As a consequence, over longer periods of time, the price level was unchanged. A dollar 20 years hence was still worth a dollar. But, an increase of 2% a year over a period of 20 years will lead to a 50% increase in the price level. It will take 150 (2032) dollars to purchase the same basket of goods 100 (2012) dollars can buy today. What will be called the “dollar” in 2032 will be worth one-third less (100/150) than what we call a dollar today."
A 33% devalue broken down, if it was gradual and controlled, would be 11% devalue each 7 years. Roughly. That was me saying that. I like smaller numbers to work with. To continue:
"Why target an annual 2 percent decline in the dollar’s value instead of price stability?" ... [yadda yadda yadda a bunch of stuff in the article I don't understand, now to sum up:] "In other words, a gradual destruction of the dollar’s value is the best the The Federal Open Market Committee (FOMC) can do."
Just as I thought.
"The Fed’s finger prints in the form of monetary manipulation are all over the dozen financial crises and spikes in unemployment we have experienced since abandoning the gold standard in 1971. The financial crisis of 2008, caused in no small part by the Fed’s efforts to stimulate the economy by keeping interest rates too low for, as it turned out, way too long is but the latest example of the Fed failing to fulfill its mandate to achieve either price stability or full employment."
Anyone who thinks the economy is getting better has potatoes for brains. Baltic Dry Index plunged to a 20 year low this week. The BDI is always used as a barometer and a harbinger of the strength or weakness of the global economy, because it is a snapshot of commodity trade through global shipping. Here is another take on the Fed's plan to devalue the dollar. He is easy to understand.
I used to love our economy. But just as Jesus is nearing His return, He is showing us that it is not something to cling to. Just as He is showing us that our ways and our management of His earth are flawed, we release attachment to our man-made constructs and ready ourselves for His currency, truth, and His economy, faith.
Tweet
Showing posts with label economy. Show all posts
Showing posts with label economy. Show all posts
Thursday, February 9, 2012
Wednesday, September 14, 2011
International alarm grows over fate of Europe's failing economy
I had written last night that Greece was said to be defaulting. However, those reports were almost immediately retracted. I wrote that no matter if the default is now or later, it will come, given the numbers. The level of debt Greece is staggering under cannot be borne much longer. Nor can Italy's, Spain's, or even the US's debt be borne by those nations much longer for that matter.
This Jefferies report quoted in Zerohedge lays it out clearly on how and why the European economic failure will be just as bad if not worse than the one the US suffered in 2008. Jefferies is a full-service securities and investment banking firm serving companies and their investors globally, not some pajama blogger or fringe guy who thinks he has a handle of geo-political economics. This is the real deal. In the report, Jefferies lays out the European end game.
"The bottom line is that it looks like a Lehman like event is about to be unleashed on Europe WITHOUT an effective TARP like structure fully in place. Now maybe, just maybe, they can do what the US did and build one on the fly - wiping out a few institutions and then using an expanded EFSF/Eurobond structure to prevent systemic collapse. But politically that is increasingly feeling like a long shot. Rather it looks like we will get 17 TARPs - one for each country. That is going to require a US style socialization of each banking system - with many WAMUs, Wachovias, AIGs and IndyMacs along the way. The road map for Europe is still 2008 in the US, with the end game a country by country socialization of their commercial banks. The fact is that the Germans are NOT going to pay for pan European structure to recap French and Italian banks - even though it is probably a more cost effective solution for both the German banks and taxpayers."
It is a very good report. Even I understood it, and math and economics is not my strong point.
British economics reporter Ambrose Evans-Pritchard wrote about Germany's and Greece's mutually assured destruction. Pritchard is another guy I like to read. He is sound. He wrote,
Germany and Greece flirt with mutual assured destruction
Bild Zeitung populism has prevailed. Germany is pushing Greece towards a hard default, risking the uncontrollable chain reaction so long feared by markets.
"Whoever thinks that Greece is an easy scapegoat, will find that this eventually turns against them, against the hard core of the eurozone," said Greek finance minister Evangelos Venizelos. Greece can, if provoked, pull the pin on the European banking system and inflict huge damage on Germany itself, and Greece has certainly been provoked."
In the wake of all this economic news from Europe, Moody's downgraded France's largest banks today.
"Moody’s Investors Service downgraded two of France’s biggest banks Wednesday, Société Générale, Crédit Agricole, citing their exposure to the Greek economy and the fragile state of bank financing markets. It kept a third, BNP Paribas, under review ... France brushed off concerns about its biggest banks Wednesday, insisting that it had no plans to nationalize any of them despite a credit rating downgrade linked to their exposure to the limping Greek economy."
The Polish Finance Minister warned that Europe was about to collapse, though his comments engendered a firestorm under which he 'clarified' and partially retracted. He said,
"While speaking at the European Parliament in Strasbourg on Wednesday, Polish Finance Minister Jacek Rostowski warned that Europe was in grave danger of collapsing if the euro zone debt crisis was not resolved rapidly. Europe must be saved at all costs, he added. Anxieties regarding the euro zone debt crisis have been mounting this week. Many judge US Treasury Timothy Geithner's announcement that he will attend a meeting of euro zone finance ministers in Wroclaw this Friday as yet another sign of the seriousness of the situation. “We should not deceive ourselves, if the euro falls apart, then Europe will not survive the shock for long,” said Mr Rostowski during his speech on Wednesday. ... Also speaking in the European Parliament on Wednesday, European Commission President José Manuel Barroso also underlined that Europe's future was at stake. “We are facing the biggest crisis of this generation,” said Mr Barroso. “It's a struggle for the political future of Europe, for European integration as a whole,” he added."
It IS a struggle to hold things together when all the forces of evil, history, and prophecy are tearing them asunder. The final empire that reforms out of this crisis and emerges in the last days will fall apart, as well. This is foretold in Daniel 2.
Wayne Blank wrote, "In the Bible study Daniel's Statue we looked at the curious prophetic symbol found in the book of Daniel. The vision of the statue was given by God to King Nebuchadnezzar of Babylon in a dream. The dream was interpreted by the prophet Daniel. The statue was a composite, made up of different materials to represent the successive human empires that ruled the land of the Bible and beyond. With the starting point of the Babylonian "head of gold" plainly stated to us by Daniel, Bible History and secular history both provide us with the other pieces of the puzzle that fit perfectly: after the Babylonian empire came the Persian empire (the chest and arms of silver); then the Greek empire (belly and thighs of bronze); and finally the Roman empire (the legs of iron). The legs of iron terminated in the feet which were composed of a mixture of iron and baked clay. Daniel provides us with a fascinating description of the "feet." The iron in the feet is described as a group of different peoples (nations) that despite their differences in language and culture, come together for a short time to fulfill an important stage in God's plan. The "baked clay" in the feet is the necessary binding agent that holds the pieces of iron together. A common religion, led by a popular, and eventually great miracle-performing leader, is thought to be the baked clay."
We do not know what the exact catalyst will be for the last Empire to emerge, nor are we told exactly when, but we do know that it will happen. Will Europe collapse all the way, only for the antichrist to arise from the chaotic smoke of the falling empire? Will Europe hang on and the antichrist appear at the right moment to offer a solution so that it will not fall? Either way, the pieces are in the air and it is both exciting and unnerving to watch them play out their final arc in the face of bible truth.
Tweet
This Jefferies report quoted in Zerohedge lays it out clearly on how and why the European economic failure will be just as bad if not worse than the one the US suffered in 2008. Jefferies is a full-service securities and investment banking firm serving companies and their investors globally, not some pajama blogger or fringe guy who thinks he has a handle of geo-political economics. This is the real deal. In the report, Jefferies lays out the European end game.
"The bottom line is that it looks like a Lehman like event is about to be unleashed on Europe WITHOUT an effective TARP like structure fully in place. Now maybe, just maybe, they can do what the US did and build one on the fly - wiping out a few institutions and then using an expanded EFSF/Eurobond structure to prevent systemic collapse. But politically that is increasingly feeling like a long shot. Rather it looks like we will get 17 TARPs - one for each country. That is going to require a US style socialization of each banking system - with many WAMUs, Wachovias, AIGs and IndyMacs along the way. The road map for Europe is still 2008 in the US, with the end game a country by country socialization of their commercial banks. The fact is that the Germans are NOT going to pay for pan European structure to recap French and Italian banks - even though it is probably a more cost effective solution for both the German banks and taxpayers."
It is a very good report. Even I understood it, and math and economics is not my strong point.
British economics reporter Ambrose Evans-Pritchard wrote about Germany's and Greece's mutually assured destruction. Pritchard is another guy I like to read. He is sound. He wrote,
Germany and Greece flirt with mutual assured destruction
Bild Zeitung populism has prevailed. Germany is pushing Greece towards a hard default, risking the uncontrollable chain reaction so long feared by markets.
"Whoever thinks that Greece is an easy scapegoat, will find that this eventually turns against them, against the hard core of the eurozone," said Greek finance minister Evangelos Venizelos. Greece can, if provoked, pull the pin on the European banking system and inflict huge damage on Germany itself, and Greece has certainly been provoked."
In the wake of all this economic news from Europe, Moody's downgraded France's largest banks today.
"Moody’s Investors Service downgraded two of France’s biggest banks Wednesday, Société Générale, Crédit Agricole, citing their exposure to the Greek economy and the fragile state of bank financing markets. It kept a third, BNP Paribas, under review ... France brushed off concerns about its biggest banks Wednesday, insisting that it had no plans to nationalize any of them despite a credit rating downgrade linked to their exposure to the limping Greek economy."
The Polish Finance Minister warned that Europe was about to collapse, though his comments engendered a firestorm under which he 'clarified' and partially retracted. He said,
"While speaking at the European Parliament in Strasbourg on Wednesday, Polish Finance Minister Jacek Rostowski warned that Europe was in grave danger of collapsing if the euro zone debt crisis was not resolved rapidly. Europe must be saved at all costs, he added. Anxieties regarding the euro zone debt crisis have been mounting this week. Many judge US Treasury Timothy Geithner's announcement that he will attend a meeting of euro zone finance ministers in Wroclaw this Friday as yet another sign of the seriousness of the situation. “We should not deceive ourselves, if the euro falls apart, then Europe will not survive the shock for long,” said Mr Rostowski during his speech on Wednesday. ... Also speaking in the European Parliament on Wednesday, European Commission President José Manuel Barroso also underlined that Europe's future was at stake. “We are facing the biggest crisis of this generation,” said Mr Barroso. “It's a struggle for the political future of Europe, for European integration as a whole,” he added."
It IS a struggle to hold things together when all the forces of evil, history, and prophecy are tearing them asunder. The final empire that reforms out of this crisis and emerges in the last days will fall apart, as well. This is foretold in Daniel 2.
Wayne Blank wrote, "In the Bible study Daniel's Statue we looked at the curious prophetic symbol found in the book of Daniel. The vision of the statue was given by God to King Nebuchadnezzar of Babylon in a dream. The dream was interpreted by the prophet Daniel. The statue was a composite, made up of different materials to represent the successive human empires that ruled the land of the Bible and beyond. With the starting point of the Babylonian "head of gold" plainly stated to us by Daniel, Bible History and secular history both provide us with the other pieces of the puzzle that fit perfectly: after the Babylonian empire came the Persian empire (the chest and arms of silver); then the Greek empire (belly and thighs of bronze); and finally the Roman empire (the legs of iron). The legs of iron terminated in the feet which were composed of a mixture of iron and baked clay. Daniel provides us with a fascinating description of the "feet." The iron in the feet is described as a group of different peoples (nations) that despite their differences in language and culture, come together for a short time to fulfill an important stage in God's plan. The "baked clay" in the feet is the necessary binding agent that holds the pieces of iron together. A common religion, led by a popular, and eventually great miracle-performing leader, is thought to be the baked clay."
We do not know what the exact catalyst will be for the last Empire to emerge, nor are we told exactly when, but we do know that it will happen. Will Europe collapse all the way, only for the antichrist to arise from the chaotic smoke of the falling empire? Will Europe hang on and the antichrist appear at the right moment to offer a solution so that it will not fall? Either way, the pieces are in the air and it is both exciting and unnerving to watch them play out their final arc in the face of bible truth.
Tweet
