Archive for August, 2012

  • The prime value, which also seems to demarcate the inner club from the rest of the BIS members, is the firm belief that central banks should act independently of their home governments. This is an easy position for Leutwiler to hold, since the Swiss National Bank is privately owned (the only central bank that is not government owned) and completely autonomous. ("I don't think many people know the name of the president of Switzerland-even in Switzerland," Pohl joked, "but everyone in Europe has heard of Leutwiler.") Almost as independent is the Bundesbank; as its president, Pohl is not required to consult with government officials or to answer the questions of Parliament-even about such critical issues as raising interest rates. He even refuses to fly to Basel in a government plane, preferring instead to drive in his Mercedes limousine.

    Ruling The World of Money: The Money Club – Part 3

    The prime value, which also seems to demarcate the inner club from the rest of the BIS members, is the firm belief that central banks should act independently of their home governments. This is an easy position for Leutwiler to hold, since the Swiss National Bank is privately owned (the only central bank that is not government owned) and completely autonomous. ("I don't think many people know the name of the president of Switzerland-even in Switzerland," Pohl joked, "but everyone in Europe has heard of Leutwiler.") Almost as independent is the Bundesbank; as its president, Pohl is not required to consult with government officials or to answer the questions of Parliament-even about such critical issues as raising interest rates. He even refuses to fly to Basel in a government plane, preferring instead to drive in his Mercedes limousine.

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  • There is, however, another reason why the central banks regularly transfer deposits to the BIS: they want to provide it with a large enough profit to support the other services it provides. Despite its name, the BIS is far more than a bank. From the outside, it seems to be a small, technical organization. Just eighty-six of its 298 employees are ranked as professional staff. But the BIS is not a monolithic institution: artfully concealed within the shell of an international bank, like a series of Chinese boxes one inside another, are the real groups and services the central bankers need-and pay to support.

    Ruling The World of Money: The Money Club – Part 2

    There is, however, another reason why the central banks regularly transfer deposits to the BIS: they want to provide it with a large enough profit to support the other services it provides. Despite its name, the BIS is far more than a bank. From the outside, it seems to be a small, technical organization. Just eighty-six of its 298 employees are ranked as professional staff. But the BIS is not a monolithic institution: artfully concealed within the shell of an international bank, like a series of Chinese boxes one inside another, are the real groups and services the central bankers need-and pay to support.

    Continue Reading...

  • Originally, the central bankers sought complete anonymity for their activities. Their headquarters were in an abandoned six story hotel, the Grand et Savoy Hotel Universe, with an annex above the adjacent Frey's Chocolate Shop. There purposely was no sign over the door identifying the BIS, so visiting central bankers and gold dealers used Frey's, which is across the street from the railroad station, as a convenient landmark. It was in the wood-paneled rooms above the shop and the hotel that decisions were reached to devalue or defend currencies, to fix the price of gold, to regulate offshore banking, and to raise or lower short-term interest rates.

    Ruling The World of Money – Part 1

    Originally, the central bankers sought complete anonymity for their activities. Their headquarters were in an abandoned six story hotel, the Grand et Savoy Hotel Universe, with an annex above the adjacent Frey's Chocolate Shop. There purposely was no sign over the door identifying the BIS, so visiting central bankers and gold dealers used Frey's, which is across the street from the railroad station, as a convenient landmark. It was in the wood-paneled rooms above the shop and the hotel that decisions were reached to devalue or defend currencies, to fix the price of gold, to regulate offshore banking, and to raise or lower short-term interest rates.

    Continue Reading...

  • Documentary on the events that led to the economic collapse of Argentina in 2001 which wiped out the middle class and raised the level of poverty to 57.5%. Central to the collapse was the implementation of neo-liberal policies which enabled the swindle of billions of dollars by foreign banks and corporations. Many of Argentina's assets and resources were shamefully plundered. Its financial system was even used for money laundering by Citibank, Credit Suisse, and JP Morgan. The net result was massive wealth transfers and the impoverishment of society which culminated in many deaths due to oppression and malnutrition. Official name: Memoria del Saqueo by Fernando Solanas 2003.

    Argentina’s Economic Collapse

    Documentary on the events that led to the economic collapse of Argentina in 2001 which wiped out the middle class and raised the level of poverty to 57.5%. Central to the collapse was the implementation of neo-liberal policies which enabled the swindle of billions of dollars by foreign banks and corporations. Many of Argentina's assets and resources were shamefully plundered. Its financial system was even used for money laundering by Citibank, Credit Suisse, and JP Morgan. The net result was massive wealth transfers and the impoverishment of society which culminated in many deaths due to oppression and malnutrition. Official name: Memoria del Saqueo by Fernando Solanas 2003.

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  • Anyone who is currently speculation/investing in stocks, thought wrong that current stock market is a free market. The market is setup mainly for the big boys and not ants (the rest of us). Sometimes some ants wins but they (the big boys) will make sure that the winning ants is small just to paint a picture into the other unsuspecting ants that the market is still a free market that anyone can win. It is a confidence game. When confidence  in a financial system fails, the whole system collapse. The big boys would not allow that to happen. They need the masses/ants to continue to use the system so that their own wealth in the system is maintain. Once in a while, the big boys will pull out some of their wealth and convert it into hard asset like gold, property, painting, antics cars, etc but they will not pull out all of their wealth all at once since they still the system up and running and they need ants to run it.

    News – ‘Buy on speculation, sell on news’ the way to go for now?

    Anyone who is currently speculation/investing in stocks, thought wrong that current stock market is a free market. The market is setup mainly for the big boys and not ants (the rest of us). Sometimes some ants wins but they (the big boys) will make sure that the winning ants is small just to paint a picture into the other unsuspecting ants that the market is still a free market that anyone can win. It is a confidence game. When confidence in a financial system fails, the whole system collapse. The big boys would not allow that to happen. They need the masses/ants to continue to use the system so that their own wealth in the system is maintain. Once in a while, the big boys will pull out some of their wealth and convert it into hard asset like gold, property, painting, antics cars, etc but they will not pull out all of their wealth all at once since they still the system up and running and they need ants to run it.

    Continue Reading...

  • In this current environment where money are mostly digital, access to banking, especially electronic banking, is crucial. One of the main advantage is ease of use. But the other aspect of electronic banking is something that most people not aware of. Every transaction can be monitor, recorded and stored indefinitely (storage is not an issue since storage cost per GB has drastically reduced). Which means that people with agenda on their mind. It is not always the government that is interested in the information but other special interest group like bankers, corporation or any entity with deep pocket money (since the data can be package and sold to the highest bidder). But government are the most happy bunch of all groups since they can maximise their tax collection! Compared to now where government depends on 'honesty' of its citizen to report their income. A little bit of scare tactics also help in collecting the tax but its nothing compared to sitting in front of monitor and seeing every transaction done by each of its loyal subjects and clicking on each to mark as taxable!

    News – Better access to banking services

    In this current environment where money are mostly digital, access to banking, especially electronic banking, is crucial. One of the main advantage is ease of use. But the other aspect of electronic banking is something that most people not aware of. Every transaction can be monitor, recorded and stored indefinitely (storage is not an issue since storage cost per GB has drastically reduced). Which means that people with agenda on their mind. It is not always the government that is interested in the information but other special interest group like bankers, corporation or any entity with deep pocket money (since the data can be package and sold to the highest bidder). But government are the most happy bunch of all groups since they can maximise their tax collection! Compared to now where government depends on 'honesty' of its citizen to report their income. A little bit of scare tactics also help in collecting the tax but its nothing compared to sitting in front of monitor and seeing every transaction done by each of its loyal subjects and clicking on each to mark as taxable!

    Continue Reading...

  • Initially, it will be affordable homes. But lucky early people who buy the property in current environment, will most likely only see the monetary gain from acquiring the said property. Most of the government land is located in the prime location, almost everyone will find ways to convert their "affordable" homes into "affordable" paychecks. People knew that everything is rising around them especially food price. So, when everything in term of price is rising around them, what else that they have that can counter or reduce their burden? When someone start selling the "affordable" homes at the higher price, automatically every other property around them start to rise. It is come naturally since current environment is a speculative environment where people are forced to speculate in everything (stocks, property, commodities, currencies, etc) to counter the effect of inflation.

    News – Making way for affordable homes

    Initially, it will be affordable homes. But lucky early people who buy the property in current environment, will most likely only see the monetary gain from acquiring the said property. Most of the government land is located in the prime location, almost everyone will find ways to convert their "affordable" homes into "affordable" paychecks. People knew that everything is rising around them especially food price. So, when everything in term of price is rising around them, what else that they have that can counter or reduce their burden? When someone start selling the "affordable" homes at the higher price, automatically every other property around them start to rise. It is come naturally since current environment is a speculative environment where people are forced to speculate in everything (stocks, property, commodities, currencies, etc) to counter the effect of inflation.

    Continue Reading...

  • What you see is not what you get. Someone or something is obviously unloading JCY starting 17/8 until 24/8. But now CIMB is recommending a "trading buy"? They who already despise this unwanted stock need someone to take the baggage because in this environment, when someone selling there must be someone on the other side who is buying. Therefore, to cut to the case, when someone profit from stock market, there must be the other side who had to bit the bullet and hold on to losses. To create and induce the appetite of buyer to buy the "unwanted" stocks, is the role of media. With news from "credible" source (Bankers. Who say bankers are bad? They had the welfare of the masses in their [stone cold] heart)and a bit of sparkle here and there, no need much effort (except couple of thousand bucks for fees) to entice the unsuspected masses to buy the unwanted baggage.

    News – Beaten JCY recoups losses after CIMB’s “trading buy” call

    What you see is not what you get. Someone or something is obviously unloading JCY starting 17/8 until 24/8. But now CIMB is recommending a "trading buy"? They who already despise this unwanted stock need someone to take the baggage because in this environment, when someone selling there must be someone on the other side who is buying. Therefore, to cut to the case, when someone profit from stock market, there must be the other side who had to bit the bullet and hold on to losses. To create and induce the appetite of buyer to buy the "unwanted" stocks, is the role of media. With news from "credible" source (Bankers. Who say bankers are bad? They had the welfare of the masses in their [stone cold] heart)and a bit of sparkle here and there, no need much effort (except couple of thousand bucks for fees) to entice the unsuspected masses to buy the unwanted baggage.

    Continue Reading...

  • One of the more popular variants of the broken window fallacy is that natural disasters result in economic growth. I remember when Katrina came around, there was no shortage of pundits (recent Nobel laureate Paul Krugman included) describing it as having created economic activity and growth, because, after all, rebuilding all the destruction will add to GDP! But was Katrina really beneficial? Imagine there is a city that is leveled by an earthquake. The residents then rebuild their city. This adds to GDP and is hailed as creating economic activity and growth. But is that an accurate assessment?

    Broken Window Fallacy

    One of the more popular variants of the broken window fallacy is that natural disasters result in economic growth. I remember when Katrina came around, there was no shortage of pundits (recent Nobel laureate Paul Krugman included) describing it as having created economic activity and growth, because, after all, rebuilding all the destruction will add to GDP! But was Katrina really beneficial? Imagine there is a city that is leveled by an earthquake. The residents then rebuild their city. This adds to GDP and is hailed as creating economic activity and growth. But is that an accurate assessment?

    Continue Reading...

  • GDP is a measure of economic output, and not economic growth. You can blow up a city and rebuild it, which creates output, but does nothing for growth. In fact, this is precisely what wars and natural disasters do. They destroy wealth that must be replaced, hence boosting output in the short run. However, the net effect is that there has been zero economic growth, only replacement of the lost wealth. Economic growth is an increase in real wealth, not a temporary increase in output.

    News – Strong growth sustainable for now, say economists

    GDP is a measure of economic output, and not economic growth. You can blow up a city and rebuild it, which creates output, but does nothing for growth. In fact, this is precisely what wars and natural disasters do. They destroy wealth that must be replaced, hence boosting output in the short run. However, the net effect is that there has been zero economic growth, only replacement of the lost wealth. Economic growth is an increase in real wealth, not a temporary increase in output.

    Continue Reading...