Apr 012016
 
 April 1, 2016  Posted by at 8:32 am Finance Tagged with: , , , , , , , , ,


William Henry Jackson Jupiter & Lake Worth R.R., Florida 1896

Asia Stocks Head for Biggest Drop in 7 Weeks Amid Broad Declines (BBG)
Hong Kong Retail Sales Plunge the Most in 17 Years (BBG)
A Bear Market Is Now Underway And It’s Likely To Be A Painful One (Felder)
Foreigners’ ‘Dumb Money’ Flees Japan Stocks (BBG)
‘Protectionist’ China Tax on Overseas Purchases Set to Kick In (WSJ)
Global Steel Industry Facing ‘Ice Age,’ Top China Mill Warns (BBG)
China’s Anbang Abandons $14 Billion Bid To Buy Starwood Hotels (Reuters)
The UK Once Made 40% Of Global Steel. Soon It May Produce Almost None (BBG)
Britain Courts Fate On Brexit With Worst External Deficit In History (AEP)
A Plan To Turn The Euro From Zero To Hero (Andricopoulos)
In Technology We Trust -Maybe- (Coppola)
How To Hack An Election (BBG)
Canada To Accept Additional 10,000 Syrian Refugees (Reuters)
Greece, Turkey Take Legal Short-Cuts In Race To Return Migrants (Reuters)
Amnesty Says Turkey Illegally Sending Syrians Back To War Zone (Reuters)
Turkey ‘Shooting Dead’ Syrian Refugees As They Flee Civil War (Ind.)
Greek Asylum System Under ‘Insufferable Pressure’ (IRIN)

Nikkei off 3.55%.

Asia Stocks Head for Biggest Drop in 7 Weeks Amid Broad Declines (BBG)

Asian stocks headed for the biggest decline in seven weeks as Japanese corporate sentiment deteriorated and a broad-based selloff from consumer discretionary stocks to healthcare engulfed the region’s equities markets. The MSCI Asia Pacific Index slid 2.2% to 126.04 as of 1:49 p.m. in Tokyo. The gauge climbed 8.2% in March, the best month since October, to end a tumultuous quarter for global markets. Equities had rebounded from lows in February as the Federal Reserve reassured investors that it won’t rush to increase borrowing costs. A stellar performance in March was tested immediately on the first day of the second quarter. Japan’s Topix index lost 3.4%, the worst start to a quarter since 2008, after the Tankan index of confidence among large manufacturers missed economist estimates.

“After strong gains from their February lows, shares are overbought and vulnerable to a pullback,” said Shane Oliver, head of investment strategy at Sydney-based AMP Capital Investors Ltd., which oversees about $122 billion. “March quarter Tankan business conditions and confidence readings were disappointing.” The Tankan index of sentiment among large manufacturers fell to a reading of 6 in the first quarter, the lowest level since mid-2013, from 12 in the previous three months, the Bank of Japan reported Friday. Economists had expected a reading of 8. A positive number means there are more optimists than pessimists among manufacturers. The Shanghai Composite Index lost 1.3% even after China’s official factory gauge showed improving conditions for the first time in eight months, suggesting the government’s fiscal and monetary stimulus is kicking in.

A jump in the official factory gauge was overshadowed by a cut in the nation’s credit rating by Standard & Poor’s. S&P cut the outlook for China’s credit rating to negative from stable, saying the nation’s economic rebalancing is likely to proceed more slowly than the ratings firm had expected. The reduction may not have much of an impact on the markets as it comes at a time when the nation’s stocks are rallying and the currency is stabilizing, according to Sinopac Securities.

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Retail sales are getting bad in multiple locations.

Hong Kong Retail Sales Plunge the Most in 17 Years (BBG)

Hong Kong’s retail sales in February have plunged the most since 1999 as fewer Chinese tourists visited the city during the Lunar New Year holiday. Retail sales dropped 21% in February to HK$37 billion ($4.8 billion) year on year, according to a statement from Hong Kong’s statistics department. Combining January and February, sales fell 14%. The monthly decline is the worst since January 1999 when sales were also down 21%. “Apart from the severe drag from the protracted slowdown in inbound tourism, the asset market consolidation might also have weighed on local consumption sentiment,” a government said in a statement on Thursday. “The near-term outlook for retail sales will still be constrained by the weak inbound tourism performance and uncertain economic prospects.”

The government will monitor closely its repercussions on the wider economy and job market, it said. Chow Tai Fook Jewellery, the world’s largest-listed jewelry chain, and Sa Sa International reported slumping sales over the holiday when mainland Chinese tourists to the territory dropped 12% during Feb. 7-13. The stock market rout and a slowing Chinese economy have affected consumer sentiment for luxury goods, Chow Tai Fook has said. Mainland China tourists “are unlikely to come back in the short term,” said Forrest Chan at CCB International Securities. Hong Kong residents are also consuming less due to stagnant property values and the weak stock market, he said. “Hong Kong’s retail market will continue to fall for the rest of 2016 as all the negative factors won’t be solved in the near term,” Chan said.

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Margin debt. Next up is margin calls.

A Bear Market Is Now Underway And It’s Likely To Be A Painful One (Felder)

NYSE margin debt fell again during the month of February. After the selloff in stocks that kicked off 2016, this should come as no surprise. Investors are usually forced to reduce leveraged bets during these sorts of episodes in the stock market. In fact, this forced selling can actually exacerbate the volatility. And because margin debt is only now beginning to come down from record highs, surpassing those seen at the 2000 and 2007 peak, this should be of concern to most equity investors. To fully appreciate this risk, I prefer to look at margin debt relative to overall economic activity. When leveraged financial speculation becomes large relative to the economy, it’s usually a sign investors have become far too greedy. As Warren Buffett would say, this is usually a good time to become more fearful, or conservative towards the stock market.

Not only did margin debt recently hit nominal record-highs, it hit new record-highs in relation to GDP, as well. In other words, over the past several decades, investors have never become so greedy as they did recently. And yes, this includes the dotcom bubble. One reason I prefer this measure is that it has a fairly high negative correlation with forward 3-year returns in the stock market. When investors become too greedy, returns over the subsequent 3 years are poor and vice versa. As of the end of February, the latest forecast implied by this measure is for a loss of about 35% over the next three years. While this measure is pretty good at forecasting 3-year returns that doesn’t help much for investors concerned with the next year or so. In this regard, it may be helpful to observe the trend of margin debt.

Where is the nominal level of margin debt relative to its 12-month moving average or simply its level from one year ago? Historically, when these indicators turn negative from such lofty levels, a bear market, as defined by at least a 20% drawdown, is already underway. Right now both of these measure are, in fact, negative. So margin debt right now is sending a very clear signal that investors have recently become very greedy. This suggests returns over the next several years should be very poor. Finally, the trend in margin debt also suggests that a new bear market is likely underway. If history is to rhyme, that means a decline of at least 20% in the S&P 500 is very likely to occur sometime soon. And because of the sheer size of the potential forced supply that could come to market in this sort of environment, that could easily be just the beginning.

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Abenomics chapter 827-B.

Foreigners’ ‘Dumb Money’ Flees Japan Stocks (BBG)

Brian Heywood, who oversees about $2 billion mostly in Japanese equities, is putting on a brave face as the market tumbles and many foreigners head for the exit. The CEO of Taiyo Pacific Partners says he welcomes the selling by overseas investors as it gives him a better chance to beat his benchmark. His logic is that many money managers invest indiscriminately in Tokyo, pushing up the entire Topix index and making stock-picking less effective. Heywood says his fund is outperforming the equity gauge this year, while declining to give details.

Foreign investors offloaded shares for 12 straight weeks, with net selling reaching a record earlier this month, as they lose faith in the Bank of Japan’s monetary policy and Prime Minister Shinzo Abe’s commitment to reviving the economy. The Topix is down 13% in 2016, and while Taiyo’s biggest holdings have posted strong gains, many others have fallen. “We don’t do well when there is a flood of money into Japan, because it’s dumb money,” Heywood, 49, said in an interview during a visit to Tokyo last week. “When the market punctures, there are companies that we want to add to. The market overreacts. We know the company. We’re at 3% and we’d like to be at 6%. We use it as an opportunity.”

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We’re going to see a lot of ‘hidden’ protectionism going forward. Globalization is now turning against individual nations.

‘Protectionist’ China Tax on Overseas Purchases Set to Kick In (WSJ)

China is tightening its grip on cross-border e-commerce, imposing a new tax system on overseas purchases that form a growing business catering to Chinese consumers with an appetite for foreign goods. The changes, announced by the Finance Ministry last week, include raising the so-called parcel tax that is currently imposed on foreign retail products that e-commerce firms ship into China. Moreover, such goods sent directly to consumers will now be treated as imports and will be subject to tariffs and value-added and consumption taxes, whose rates vary depending on the type and value of goods. The ministry said the changes, which become effective April 8, are intended to put foreign and domestic products on an equal footing.

Industry analysts said the move seems designed to give a boost to “made-in-China” products and could dent a small, but growing, market for foreign goods sold by Alibaba, JD.com. and other e-commerce players. Those marketplaces feature nutritional supplements and food by brands such as Ocean Spray, as well as diapers and other baby and maternal products. They form a slice of the 5 trillion yuan ($773 billion) in sales by e-commerce firms in China last year, double the level of 2012, according to Beijing-based research firm Analysys International. The new levies could dampen some demand, just as an increasing number of retailers world-wide are hoping to sell into China, said Charles Whiteman, senior vice president of client services for MotionPoint, a technology company that helps international retailers sync their e-commerce websites across languages and currencies.

“Increases in prices always have the effect of driving demand down,” but the effect will be “modest,” Mr. Whiteman said. “It probably won’t be too noticeable for branded products,” for which consumers are willing to pay a premium. Chinese consumers have demonstrated a willingness to pay more for products such as cosmetics, infant formula and other baby products. Chinese e-commerce companies have said that such products form the vast majority of the imported products sold on their websites, because of product-safety concerns in China. Alibaba and JD.com said they expected robust demand from Chinese consumers for overseas products, especially high-quality ones, to continue, even with the changes in policy.

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Yeah, that metaphor sort of works.

Global Steel Industry Facing ‘Ice Age,’ Top China Mill Warns (BBG)

The crisis engulfing the global steel industry is so severe that one of China’s top producers has warned a new Ice Age has set in as mills confront overcapacity and rising competition that threaten their survival. “In 2015, China experienced a slowdown in economic growth and excess steel capacity, which caused the domestic and overseas steel industry to enter into an ‘Ice Age’,” Angang Steel said after posting a net loss of 4.59 billion yuan ($710 million) for last year. There are severe challenges, fierce competition and difficult survival conditions, it said. Steel demand in China is shrinking for the first time in a generation as growth slows and policy makers seek to steer the economy toward consumption.

Faced with declining sales at home, mills in the top producer – which accounts for half of global supply – have shipped record volumes overseas, heightening competition from Europe to the U.S. Tata Steel Ltd. in India said this week it’s planning to sell off its loss-making U.K. plants, prompting Prime Minister David Cameron to call crisis talks on Thursday. The steel industry is set for a “severe winter,” Angang said, describing the market that it and others faced as complex. Output of steel by the country’s fourth-biggest producer contracted 4.4% last year, and the company is seeking to reduce costs and boost efficiency, it said.

Benchmark steel prices sank 31% in China last year, pummeling mills’ margins and spurring the government to step up efforts to force the industry to shut overcapacity and shift workers to other jobs. While reinforcement bar has rebounded since November, Daniel Hynes, senior commodities strategist at Australia & New Zealand Banking Group Ltd., forecasts the rally may not last. “The short-term rally we’ve seen in steel prices will give way to the longer-term dynamic of weaker steel consumption in China,” Hynes said by phone on Thursday. “I suppose the positive thing is that maybe the restructuring we’re seeing in the steel industry will speed up the rationalization of the market.”

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This is becoming a curious case. Rumor has it Anbang couldn’t produce details on how they would finance the deal.

China’s Anbang Abandons $14 Billion Bid To Buy Starwood Hotels (Reuters)

China’s Anbang Insurance said on Thursday it has abandoned its $14 billion bid for Starwood Hotels & Resorts Worldwide, paving the way for Marriott International to buy the Sheraton and Westin hotels operator. The surprise withdrawal marks an anticlimactic end to a bidding war that had pitted Marriott’s ambitions to create the world’s largest lodging company, with about 5,700 hotels, against Anbang’s drive to create a vast portfolio of U.S. real estate assets. It also represents a blow to corporate China’s growing ambitions to acquire U.S. assets. Anbang’s acquisition of Starwood would have been the largest takeover of a U.S. company by a Chinese buyer.

“We were attracted to the opportunity presented by Starwood because of its high-quality, leading global hotel brands, which met many of our acquisition criteria, including the ability to generate consistent, long-term returns over time,” Anbang said. “However, due to various market considerations, the consortium has determined not to proceed further,” Anbang added, referring to the joint bid it had put together with private equity firms J.C. Flowers and Primavera Capital. Anbang did not offer Starwood a reason for not following through on its raised offer of March 26, according to people familiar with the matter. They asked not to be identified disclosing confidential discussions. “The reason of withdrawal is simple – Anbang isn’t interested in a protracted bidding war,” Fred Hu, Chairman of Primavera, told Reuters..

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What happens when all your priorities are short term.

The UK Once Made 40% Of Global Steel. Soon It May Produce Almost None (BBG)

The U.K. once made nearly half the world’s steel. Soon it may produce almost none. Tata Steel plans to sell its U.K. business which include the country’s last blast furnace sites in Scunthorpe and Port Talbot. Used to turn iron ore into steel, these giant plants are the focus of the entire industry. They are also the assets that may prove the most difficult to unload, according to at least one potential buyer. Should Tata’s plants follow Redcar, shut last year, the U.K. would become the first member of the Group of Seven leading economies to operate no blast furnaces. It’s a far cry from its Victorian metal-bashing heyday when Britain produced about 40% of global supply. But beyond the immediate impact on employment, does it matter? Does a major industrial economy need to produce steel, a material vital to industries from construction to car making?

“They’re probably done for,” said Keith Burnett, vice-chancellor at the University of Sheffield, a place that won the moniker Steel City before the industry’s decline. “But if we accept that, it’s a really big step and the long-term consequences are to lose the capabilities to make our own railways, make our own weapon systems, make our own nuclear reactors.” The U.K. was already the industrial world’s laggard when it comes to steel, producing just 12.1 million tons in 2014, less than a third of what Germany makes each year and just over a tenth of Japan’s 110.7 million=ton output. China is the world’s biggest producer making about half the world’s 1.67 billion tons of steel.

British steelmaking has been in relative decline for more than a century, eclipsed by the by the U.S. by the start of World War I and later overtaken by Germany. In the 1970s and 1980s, inefficient and outdated plants led to production falling 64% to less than 10 million metric tons, and the country’s output slipped below France, Italy and Belgium. Still, manufacturing in steel-consuming industries is buoyant. U.K. car production hit a 10-year high last year with 1.6 million cars being made in Britain as overseas sales reached record numbers. The country employs 2.6 million people in manufacturing, much of it steel related, and it accounts for 44% of exports.

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More of the same short term focus that will end up damaging Britain for decades to come.

Britain Courts Fate On Brexit With Worst External Deficit In History (AEP)

Britain’s current account deficit is the worst ever recorded in peace-time since the Bank of England started collecting records in 1772 under the reign of George III. Even during the grimmest moments of the First World War it only slightly exceeded the eye-watering figure of 7pc of GDP racked up in the fourth quarter of last year. No other country in the OECD club is close to this. It has been getting worse for the last four years in a row. Excuses are running thin. The Government can no longer blame the double-dip recession in the eurozone, our biggest export market. Europe has been recovering for three years and is currently enjoying as much growth as it is ever likely to see. The UK deficit is prima facie evidence of a nation living beyond its means, reliant on foreign capital to fund consumption.

Global investors have so far chosen to overlook this chronic deterioration, accepting the stock assurance from London that it is a temporary blip caused by declines in investment income. This may change as the vote on Brexit draws near and the polls tighten. Most investors in Asia, the US, and the Middle East have treated the referendum as political pantomime, taking it for granted that British voters would (as the world sees it) make the “rational” choice. “Very few people have been focusing on the current account. Brexit is now bringing it firmly into focus. We are getting a lot more questions about this from clients in Europe,” said David Owen from Jefferies. The dawning realization that Britain might indeed opt for secession has clearly begun to rattle markets. Sterling has fallen 9pc against a trade-weighted basis since November. The spread between Gilts and German Bunds has been creeping up, an early warning sign of trouble.

The Bank of England’s Financial Policy Committee noted signs of stress in the sterling options market in a statement this week, and warned that it may become harder to the inflows of capital needed to cover the external deficit. Lena Komileva from G+Economics said the current account deficit is now so large that it leaves the country vulnerable to external shocks, amplifying the potential impact of Brexit. Britain’s credit-driven consumer credit is “plainly unsustainable”. The UK savings ratio has fallen to a record low of 3.8pc. Consumer credit has risen by 44pc over the last year to £1.3bn. “We are not very different from the structural fragility of the economy that we had prior to the 2007 global crash,” she said. The Office for Budget Responsibility warned earlier this month that households are running an “unprecedented” deficit of 3pc of GDP – worse than the pre-Lehman peak – with no improvement expected through to the early 2020s.

People are running through savings and taking on debt to fund their lifestyles and buy new cars. They are expected to spend £58bn more than they earn this year, rising to £68bn by the end of the decade. This roughly mirrors what was happening just before the 2007 financial crisis when people were treating their homes as a cash machine, drawing down £50bn a year in home equity. Events were to show brutally that this was not benign.

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Well, one can dream, surely. But without -unacceptable to many- ‘transfers’ from north to south, can the euro survive at all?

A Plan To Turn The Euro From Zero To Hero (Andricopoulos)

It is difficult to read the history of inter-war Europe and the US without feeling a deep sense of foreboding about the future of the Eurozone. What is the Eurozone if not a new gold standard, lacking even the flexibility to readjust the peg? For the war reparations demanded at Versailles, or the war debts owed by France and the UK to the US, we see the huge debts owed by the South of Europe to the North, particularly Germany. The growth model of the Eurozone now appears to be based largely on running a current account surplus. Competitive devaluation is required to make exports relatively cheap. While this may have been a very successful policy for Germany during a period of high economic growth in the rest of the world, it cannot work in the beggar-thy-neighbour demand-starved world economy of today.

As I’ve explained elsewhere, reasonably large government deficits are very important for sustainable economic growth. However, in the Eurozone this is prohibited both by the Stability and Growth Pact (SGP) and by the fear of losing market confidence in the national debt. At the same time credit growth for productive investment is constrained by weak banks and Basel regulation. And the Eurozone as a whole is already running a large current account surplus; the rest of the world will not allow much more export-led growth. Helicopter money would be a solution, but politically this is a long way away. Summing up, if economic growth cannot be funded by government deficits, private sector debt, export growth or helicopter money it is very difficult to see where nominal GDP growth can come from.

In a way, this can be seen as a Prisoner’s Dilemma. Every country knows (or should know) that if all states provided fiscal stimulus, the Eurozone would benefit from more economic growth. However, for any individual state, a unilateral fiscal boost would increase their own government debt whilst giving a fair amount of the GDP growth to other states (because some of the stimulus would go to increasing imports from the other nations). And if all others provide stimulus, then it is in an individual state’s interest to take the benefit of the other states’ stimulus, and become more competitive versus the rest.

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We could do with more blockchain scrutiny.

In Technology We Trust -Maybe- (Coppola)

David Andolfatto of the St. Louis Federal Reserve wonders if investors see Bitcoin as a “safe asset”. By this he means the sort of asset that investors run to when economic storm clouds gather and other asset classes start to look dangerous: “Loosely speaking, I’m thinking about an asset that people flock to in bad or uncertain economic times. In normal times, it’s an asset that is held despite having a relatively low rate of return, perhaps because of its use as a hedge, or because of its liquidity properties.” Like gold, in fact. In important respects, Bitcoin is indeed like gold. Digital gold. It is “mined”, with mining becoming more difficult and expensive as undiscovered supplies dwindle.

There is an absolute limit (21 million) on the number of bitcoins that can ever be mined: once all have been “discovered”, the supply is fixed, unless the Bitcoin community decides that the hard limit should be changed – which at present seems rather less likely than mining asteroids for gold. The gold-like nature of Bitcoin protects it from hyperinflationary collapse, believed by many goldbugs and Bitcoin geeks to be the inevitable future of today’s government-issued fiat currencies. And, importantly, it is not under the control of governments or central banks. Neither the political mafia nor the economics establishment have any say over how, when or if it is produced, nor over its market price. For people who believe that “GUBBMINT WILL STEAL YOUR MONEY”, Bitcoin is possibly even more secure than gold.

After all, in the 1930s the US government confiscated private sector gold holdings. But it has no means of confiscating Bitcoin holdings, since identifying exactly who holds them is costly and difficult, and they can easily be transferred out of reach anyway. Bitcoin is, after all, an international currency with its own highly efficient money transfer technology. Like gold, Bitcoin’s market price tends to be volatile. And like gold, its value also tends to be counter-cyclical. When the US economy weakens, or global risks rise, up goes gold…..and Bitcoin. The profiles of both vis-à-vis the US dollar since the end of 2013 look remarkably similar. We can perhaps say that investors run to gold when trust in government and its instruments fails. In God We Trust becomes In Gold We Trust. But where does Bitcoin fit in?

Bitcoin’s advocates claim that the system is a “trust-free system”, because there are no intermediaries. But for the system to work at all, there must be trust – trust that the technology will work. In Gold We Trust becomes In Technology We Trust. It is perhaps not surprising that Bitcoin use is highest among those with a background in computer science. But hang on. There’s a problem, isn’t there? After all, governments are human constructs. And so are cryptocurrencies. The coders behind Bitcoin are human. Why should anyone have more trust in a digital currency created by an anonymous group of coders accountable to no-one than in a democratically-elected government accountable to everyone? Why is an essentially feudal governance model “safer” than a democratic one?

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The election hit man.

How To Hack An Election (BBG)

It was just before midnight when Enrique Peña Nieto declared victory as the newly elected president of Mexico. Peña Nieto was a lawyer and a millionaire, from a family of mayors and governors. His wife was a telenovela star. He beamed as he was showered with red, green, and white confetti at the Mexico City headquarters of the Institutional Revolutionary Party, or PRI, which had ruled for more than 70 years before being forced out in 2000. Returning the party to power on that night in July 2012, Peña Nieto vowed to tame drug violence, fight corruption, and open a more transparent era in Mexican politics. Two thousand miles away, in an apartment in Bogotá’s upscale Chicó Navarra neighborhood, Andrés Sepúlveda sat before six computer screens.

Sepúlveda is Colombian, bricklike, with a shaved head, goatee, and a tattoo of a QR code containing an encryption key on the back of his head. On his nape are the words “” and “” stacked atop each other, dark riffs on coding. He was watching a live feed of Peña Nieto’s victory party, waiting for an official declaration of the results. When Peña Nieto won, Sepúlveda began destroying evidence. He drilled holes in flash drives, hard drives, and cell phones, fried their circuits in a microwave, then broke them to shards with a hammer. He shredded documents and flushed them down the toilet and erased servers in Russia and Ukraine rented anonymously with Bitcoins. He was dismantling what he says was a secret history of one of the dirtiest Latin American campaigns in recent memory.

For eight years, Sepúlveda, now 31, says he traveled the continent rigging major political campaigns. With a budget of $600,000, the Peña Nieto job was by far his most complex. He led a team of hackers that stole campaign strategies, manipulated social media to create false waves of enthusiasm and derision, and installed spyware in opposition offices, all to help Peña Nieto, a right-of-center candidate, eke out a victory. On that July night, he cracked bottle after bottle of Colón Negra beer in celebration. As usual on election night, he was alone.

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Bright spot. Europe must study Canadian law.

Canada To Accept Additional 10,000 Syrian Refugees (Reuters)

Canada will take in an additional 10,000 Syrian refugees, adding to the more than 25,000 already received in the last few months, said immigration minister John McCallum. McCallum told the Canadian Broadcasting Corp he was responding to complaints from Canadian groups who want to sponsor Syrian refugees but did not have their applications processed quickly enough to be among the government’s initial target of 25,000. “We are doing everything we can to accommodate the very welcomed desire on the part of Canadians to sponsor refugees,” McCallum said in a phone interview with CBC News from Berlin, where he is meeting with the German interior minister. The Liberal government won election in October 2015 pledging to bring in more Syrian refugees more quickly than the previous Conservative government.

Private groups including church, family and community organizations had lined up to sponsor Syrian families. The welcome contrasts sharply to Europe, where resettlement has sparked an anti-migrant backlash amid security fears. While there have been some delays finding permanent housing for refugees arriving in Canada, particularly in large cities like Toronto where the housing market is tight, the resettlement program has been mostly smooth. [..] . A total of 26,200 Syrian refugees had arrived in Canada as of 28 March, according to the immigration department. But nearly 16,000 more applications are in process or have been finalized, even though the refugees have not yet arrived, according to official figures.

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Fast and loose.

Greece, Turkey Take Legal Short-Cuts In Race To Return Migrants (Reuters)

Greece and Turkey are rushing through changes to their asylum rules in a race to implement a EU-Turkey agreement on the return of refugees and migrants from Greek islands to Turkey from next Monday, EU officials and diplomats said. Both Athens and Ankara must amend their legislation to permit the start of a scheme – denounced by the U.N. refugee agency and rights groups – to send back all migrants who crossed to Greece after March 20. The policy is meant to end the uncontrolled influx of refugees and other migrants in which more than a million people crossed into Europe last year, causing a political backlash and pitting EU countries against each other. Greece, which started evacuating hundreds of people stranded in Athens’ Piraeus port on Thursday, submitted to parliament an asylum amendment bill on Wednesday.

Brussels said it had assurances from Athens that it would be passed this week. But it does not explicitly designate Turkey as a “safe third country” – a formula to make any mass returns legally sound – and a senior official of the United Nations High Commissioner for Refugees said that change did not remove its concerns about protecting the rights of asylum seekers. “Our concerns regarding legal safeguards remain unchanged and we hope that the Greek authorities will take them fully into consideration,” UNHCR Europe director Vincent Cochetel said. The EU executive’s spokeswoman, Natasha Bertaud, was unable to say how exactly rejected asylum seekers would be removed from camps on Greek islands or transported back to Turkey, saying those details were still being worked out.

[..]The Greek bill does not name Turkey, but Bertaud said that was not essential provided rules were in place allowing people to be sent back to a “safe third country” or a “safe first country of asylum”, and each case was examined individually. EU officials said the formula was devised to get around unease among lawmakers in Greece’s ruling Syriza party at declaring Turkey safe when it is waging a military crackdown on Kurdish separatists and is accused of curbing media freedom and judicial independence. Asked why Turkey was not mentioned, Greece’s alternate minister for European affairs, Nikos Xydakis, told To Kokkino radio: “It cannot be in a law, because the examination of each application for asylum will be on a case by case basis. That is the safety trigger under international refugee law. Each person is a special case.”

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“It is a deal that can only be implemented with the hardest of hearts and a blithe disregard for international law..”

Amnesty Says Turkey Illegally Sending Syrians Back To War Zone (Reuters)

Turkey has illegally returned thousands of Syrians to their war-torn homeland in recent months, highlighting the dangers for migrants sent back from Europe under a deal due to come into effect next week, Amnesty International said on Friday. Turkey agreed with the EU this month to take back all migrants and refugees who cross illegally to Greece in exchange for financial aid, faster visa-free travel for Turks and slightly accelerated EU membership talks. But the legality of the deal hinges on Turkey being a safe country of asylum, which Amnesty said in its report was clearly not the case. It said it was likely that several thousand refugees had been sent back to Syria in mass returns in the past seven to nine weeks, flouting Turkish, EU and international law.

“In their desperation to seal their borders, EU leaders have wilfully ignored the simplest of facts: Turkey is not a safe country for Syrian refugees and is getting less safe by the day,” said John Dalhuisen, Amnesty International’s Director for Europe and Central Asia. Turkey’s foreign ministry denied Syrians were being sent back against their will. Turkey had maintained an “open door” policy for Syrian migrants for five years and strictly abided by the “non-refoulement” principle of not returning someone to a country where they are liable to face persecution, it said. “None of the Syrians that have demanded protection from our country are being sent back to their country by force, in line with international and national law,” a foreign ministry official told Reuters.

But Amnesty said testimonies it had gathered in Turkey’s southern border provinces suggested the authorities have been rounding up and expelling groups of around 100 Syrian men, women and children almost daily since the middle of January. Many of those returned to Syria appear to be unregistered refugees, though the rights group said it had also documented cases of registered Syrians being returned when apprehended while not carrying their papers. Amnesty also said its research showed the authorities had scaled back the registration of Syrian refugees in the southern border provinces. Those with no registration have no access to basic services such as healthcare and education. [..] “The large-scale returns of Syrian refugees we have documented highlight the fatal flaws in the EU-Turkey deal. It is a deal that can only be implemented with the hardest of hearts and a blithe disregard for international law,” Amnesty’s Dalhuisen said.

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How can Europe continue with the Turkey deal under these conditions?

Turkey ‘Shooting Dead’ Syrian Refugees As They Flee Civil War (Ind.)

Turkish security forces have shot dead refugees escaping from the Syrian conflict, according to reports. UK-based monitoring group the Syrian Observatory for Human Rights alleged 16 people seeking sanctuary in Turkey have been shot over the past four months. They said those killed included three children. Other examples compiled by the Syrian Observatory include the alleged killings of a man and his child at Ras al-Ain, at the eastern end of the Turkish-Syrian border. In the west of the country, two refugees were reportedly shot dead at Guvveci on 5 March. “It’s in all areas. It happens to people coming from Idlib, Aleppo, Isis areas, Kurdish areas,” a spokesman for the Syrian Observatory told The Independent.

Other sources, including a Syrian people smuggler based in Turkey and an officer of the UK-supported Free Syrian Police, told The Times they believed the number of refugees killed by Turkish forces was actually far higher. They said this was because people killed on the Syrian side of the border were buried in the conflict zone, where record keeping is much more difficult. The smuggler told the newspaper refugees attempting to cross the border would now “either be killed or captured”. Citing Turkey’s former open-door refugee policy, he added: “Turkish soldiers used to help the refugees across, carry their bags for them. Now they shoot at them.” It is not the first time Turkish authorities have faced criticism over their treatment of refugees. In March, the Turkish Coast Guard allegedly attacked a dinghy filled with migrants in the Aegean. The latest allegations are likely to cast further scrutiny on the EU migrant deal with Turkey.

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“This is how true refugees are lost. Do we really think that a Somali woman who has been raped will sit down and merrily rattle off her experiences?”

Greek Asylum System Under ‘Insufferable Pressure’ (IRIN)

As Greece prepares to deport an initial 500 migrants and refugees on Monday under a controversial agreement between the EU and Turkey, senior Greek officials say the pressure to process applications quickly has become too great, at the expense of legal and ethical standards. “Insufferable pressure is being put on us to reduce our standards and minimise the guarantees of the asylum process,” Maria Stavropoulou, who heads the Greek Asylum Service, told IRIN. “[We’re asked] to change our laws, to change our standards to the lowest possible under the EU directive [on asylum procedures].” Under the terms of the 18 March agreement, Greece must screen all new arrivals from Turkey as quickly as possible and return those deemed not in need of international protection on the basis that Turkey is a “safe third country” or “first country of asylum” where they were already protected.

Most of the pressure, according to Stavropoulou, is coming from “countries that are very invested in the deal with Turkey working.” Germany, which received more than one million asylum seekers last year, took a leading role in negotiations with Turkey during a tense two-day summit earlier this month. In addition to having to screen and return new arrivals, Greece is also dealing with high numbers of asylum applications from the more than 50,000 refugees and migrants who were already trapped inside Greece before the agreement with Turkey came into effect. An overland route through the western Balkans to Germany has been closed for a month and many of those who cannot afford to pay smugglers to find a new route to Western Europe are now applying for asylum in Greece. Authorities here expect to receive just under 3,000 applications in March, double the figure for January and three times last year’s monthly average.

But even as the numbers have mounted, so has the pressure for speedy processing. The Greek Asylum Service has just hired three dozen new personnel, bringing its total staff to 295. But it says it will need at least double that number to handle the expected caseload in the wake of the EU-Turkey agreement. The European Commission has estimated that some 4,000 personnel are likely to be needed in Greece and is sending reinforcements. Many of those slated to join the effort are coastguard officers, but some 800 are asylum experts and interpreters from other member states and from the European Asylum Support Office, the EU’s coordinating body for asylum matters. The first 60 are to arrive in Greece on Sunday.

[..] Some asylum experts believe that the pressure for rapid screening will mean that vital information for determining asylum claims is overlooked. “It always takes time,” said Spyros Kouloheris, head of legal research at the Greek Council for Refugees (GCR), the country’s most respected legal aid NGO. “Someone who is traumatised will speak in fits and starts. They appear not to be telling the truth. We’ve lost a lot of cases because we didn’t have the time, the information, the culture, the experience, to understand that the more broken up the narrative, the more likely it is that there is a background of torture and abuse. This is how true refugees are lost. Do we really think that a Somali woman who has been raped will sit down and merrily rattle off her experiences?”

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Home Forums Debt Rattle April 1 2016

This topic contains 16 replies, has 8 voices, and was last updated by  TheTrivium4TW 3 years, 7 months ago.

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  • #27555

    William Henry Jackson Jupiter & Lake Worth R.R., Florida 1896 • Asia Stocks Head for Biggest Drop in 7 Weeks Amid Broad Declines (BBG) • Hong Kong Ret
    [See the full post at: Debt Rattle April 1 2016]

    #27556

    DIYer
    Participant

    England no longer making steel —
    It’s nice to have coal, if you are going to make steel. Anthracite coal is especially good. And not just for the heat produced by burning it, but also the chemistry of the steel. Iron and carbon sort of go together.
    Anyway, isn’t the UK past ‘peak coal’ by now?
    It’s sort of an old-fashioned idea, but I’d think it would be easier to make steel, glass, concrete, etc. near to where the fuel and components are found.

    Does English steel make sense, really, with iron ore imported from Australia and coal from America?
    (and then too, of course, there’s the little no-demand thingy ..)

    #27557

    Dr. Diablo
    Participant

    “reasonably large government deficits are very important for sustainable economic growth.”

    Full stop. Would spending money you don’t have create growth? Sure. “Sustainable” growth? No. By definition, unless you talk about increasing deficits, exponentially increasing (due to interest rate) forever. And “Very important” for growth? Has everyone in the world forgotten that you can expand your economy on savings and productivity? I know it’s been 100 years, but it IS possible. So one sentence: wrong, wrong, and wrong.

    “[Bitcoin] is not under the control of governments or central banks. Neither the political mafia nor the economics establishment have any say over how, when or if it is produced, nor over its market price. For people who believe that “GUBBMINT WILL STEAL YOUR MONEY”, Bitcoin is possibly even more secure than gold.”

    Also wrong. If any single entity can get enough of the blockchain, they can view all transactions. If they have that much ownership, they can then also trade amongst themselves to rig the price, no differently and in fact easier than HFT’s do. How would they do that? Well, print digital money infinitely as a matter of national security until they bought +50% basically for free? Can anyone tell me why they wouldn’t immediately?

    BitCoin also has critical liabilities compared to physical currencies: one, to use it, you need an entry record (as you transfer out of the bank system) and a purchase endpoint that interacts with a legitimate (we hope) business or bank. It can be shut off or taxed instantly at that point. There is no “underground” BitCoin in that regard. It also depends on a pretty good internet and electric. Although that doesn’t seem at risk right now, it didn’t seem so for Ukraine or Syria recently, or a 1st world country like Germany in 1938. Nevertheless, it was just about to be difficult to access indeed.

    Point being: wrong, wrong, and wrong. Although gold may also be outlawed, confiscated, taxed, with the addition of a highly technical digital side, BitCoin is clearly more fragile and less reliable than a pet rock. Especially the HFT and visibility sides. If you use it, just be aware of what it is and what it isn’t; the story about it being private, fair, and non-government has some significant holes.

    #27558

    rapier
    Participant

    Take this under advisement. That being Zero Hedge is a disinformation machine. Some things are true, some things are not. (in my opinion ZH is an arm of the powers that be to engage in ‘modified limited hangout’ (look it up), to stir up alt economics fans in the direction of the right, and to disclose policy moves in a non official way)

    At any rate who needs helicopters for helicopter money and to boot why have currency at all.

    https://www.zerohedge.com/news/2016-04-01/who-needs-helicopters-draghi-plans-fool-proof-ecb-backed-debit-card

    #27559

    TheTrivium4TW
    Participant

    >>Full stop. Would spending money you don’t have create growth? Sure. “Sustainable” growth? No. By definition, unless you talk about increasing deficits, exponentially increasing (due to interest rate) forever. And “Very important” for growth? Has everyone in the world forgotten that you can expand your economy on savings and productivity? I know it’s been 100 years, but it IS possible. So one sentence: wrong, wrong, and wrong.<<

    No, diablo, you can’t. This is the libertarian fallacy, and one big reason why the Debt-Money Monopolist controlled Rockefeller Foundation financed Mises’s libertarian ideas.

    Let’s use a simple example and see if you can prove my claim wrong using actual numbers.

    You are society and I am the Debt-Money Monopolist that lends you money.

    I loan you $20 @ 5% interest per year. At the end of 1 year, you owe me $21 due to double entry bookkeeping adjustments that add $1 interest liability to your balance sheet and $1 interest asset to my balance sheet.

    Please tell me how you can “grow” that $20 into more money by saving and investing (or any other means under the sun) if I hold onto my $1 interest and don’t lend more money into existence.

    Good luck with that. 🙂

    People assume they comprehend the mechanics of the monetary system, but they really do not. The entire Debt-Money Monopolist Fascist Mega-Corporatocracy (DMMFMC) spews incessant mis/disinformation, but we still have to understand how it works. This zero-sum game “trap door” mechanism is almost never discussed and never discussed in the simple $20 example I created to help people better understand the mechanics.

    Establishment libertarian thought is completely blind to this facet of debt-based money issuance… and so ingrained in their views that most are incapable of learning it even in this simple format. Either that, or they are controlled opposition like Steve Keen.

    “In our time, the curse is monetary illiteracy, just as inability to read plain print was the curse of earlier centuries.”
    ~ Ezra Pound

    #27560

    seychelles
    Participant

    MLH

    Back to the Future: The “modified, limited hang out,” c. 2013


    and with regard to ZH, yes, overall it is a “confusing” site…

    #27561

    Dr. Diablo
    Participant

    I think we’re on the same side here. My point was, you can’t loan a thing you don’t have to *sustainably* grow. Because prima facie you’re promising to deliver a reward you don’t (yet) have. If you have debt-based money this will never, ever work. But it’s worse than that. Even if you have a commodity-based money you’re very, very likely to have it, because beyond even fractionally-reserve lending against a commodity standard, *promises* are the ultimate in inflating the money supply, and they’re not tied to a standard, a law, or a rule. Human optimism says “If you do this job, when it’s done, I’ll pay you from the profits.” How do you stop that inflation, promising more goods than there are to deliver, based on hopes for tomorrow? (I will point out that a commodity standard can create more of the commodity, like gold at 3% p.a., and also such standards inflate AND deflate around the standard, as the world did through the 19th century. So where would you get the 21st dollar? A guy in California dug it out of the ground. However in reality this still wouldn’t be a primary driver–paper derivatives of bullion would still inflate and deflate, be promised and default.)

    Nevertheless, we can limit this nonsense to safer levels and put in firewalls for default. From a system backed with nothing (post-2001) to a fractional system that has standards and accounting (70s), to a commodity standard containing the paper on top (pre-WWI) to a system primarily, but not exclusively commodity-based (middle ages), all the way back to a goods-trading economy, each one more stable than the last, but none without flaw, for the fault is in ourselves.

    But back to my point, if a credible figure promises to pay people tomorrow for hamburgers today, will they go out and make them? You bet they will. And later, when he doesn’t pay, the “malinvestment” of the artificial economy collapses, all the producers are angry, and all the extra burgers are wasted, and confidence is shattered as they try to recover from wasting time and money on doing something stupid. That’s why it’s not sustainable. It’s just that, unlike hamburgers, economic fraud of low interest rates and malinvestment takes far, far longer to discover and fail. Long enough that one generation parties, and the next generation dies.

    This is why even with digital numbers, you can’t exponentially increase a money system at an increasing rate forever: at some point people realize it’s totally absurd for every infant to have $1m in debt when born, but if not a million, then a billion, a trillion, a quadrillion. It ends. Wimpy doesn’t pay. Because he can’t.

    #27562

    seychelles
    Participant

    “…for the fault is in ourselves.”
    This is the most important observation, the elementary particle. We are inherently defective and contradictory beings. The best we can do is to understand how this frailty manifests itself in cyclical changes through time and to proactively position ourselves within the evolving structure.

    #27563

    TheTrivium4TW
    Participant

    >>I think we’re on the same side here. My point was, you can’t loan a thing you don’t have to *sustainably* grow.<<

    Hi diablo, this is exactly true. Note that “growth” is arbitrarily defined as debt-based money growth, NOT the growth of actual physical production. If an economy sells 3 items for $10 one year and 2 items for $11 then next year, the “GDP growth” is reported as +10% even though the contraction in the physical world was 33%. Contrary to common thought, statistics don’t actually lie, liars misuse statistics and conceal the actual data and logic underlying the statistic so people won’t be able to discern what the statistic actually means.

    Your are absolutely correct that exponential debt-growth is unsustainable, just like any other exponential function. The DMMs know this as well. A debt-based implosion of the economy is a feature, not a bug. That’s when they bust debtors and seize their assets using everyone’s beloved government agents to do the dirty work.

    Check out “Power of the Purse” – I’m about halfway through and it is good so far. I can’t vouch for what comes next, though… it might be golden or rusty. I’ll comment after I’ve watched all 4.5 hours of it.

    >>But back to my point, if a credible figure promises to pay people tomorrow for hamburgers today, will they go out and make them? You bet they will. And later, when he doesn’t pay, the “malinvestment” of the artificial economy collapses, all the producers are angry, and all the extra burgers are wasted, and confidence is shattered as they try to recover from wasting time and money on doing something stupid. That’s why it’s not sustainable. It’s just that, unlike hamburgers, economic fraud of low interest rates and malinvestment takes far, far longer to discover and fail. Long enough that one generation parties, and the next generation dies.<<

    It is actually worse than that. Yes, debt-based money bubbles create malinvestment, but they are an effect, not a cause. The reason that this system is unsustainable is much more fundamental than malinvestment. You could invest perfectly and this system would still fail. Debt-money systems are prima facie fraud. They are literally a weapon of warfare used to subjugate a people through the use of deception.

    The real reason for failure (from an ordinary person’s standpoint, this system works GREAT for the Debt-Money Monopolists!) is two-fold. Going back to the $20 example, you only have $20 and you owe me $21 and I control the $1 you need to pay me back, THEREFORE, YOU’VE ALREADY “FAILED” BEFORE YOU EVEN STARTED. You can invest that $20 perfectly, but you can’t earn what doesn’t exist.

    The second mechanism is the one the DMM has in play. The following is the real reason that inflation must be targeted or else the system implodes. I don’t want to steal just your $20 collateral, so, I “inflate” by creating another $20. Now you can earn that $1 from the new $20 and pay back your debts, but the new borrower has $19 and owes $21 after one year – the amount owed grows, too. This is exponential growth in debt and, as I said, all exponential function either 1. fail or 2. end up in infinity, and the latter doesn’t happen.

    When the exponential debt-growth fails, the entire system collapses right into the hands of the Debt-Money Monopolists because you (all the debtors, including governments!) don’t have enough money to pay back your debts. All the net monetary wealth of the DMMFM-C (Debt-Money Monopolist Fascist Mega-Corporatocracy) IS EVERYONE ELSE’S INEXTINGUISHABLE DEBT, AND INEXTINGUISHABLE DEBT WILL BE BUSTED AND COLLATERAL ASSETS SEIZED. Say “goodbye” to all those “UN Heritage” sites once the Banksters call in the debts and society is impoverished and can’t pay.

    >> Wimpy doesn’t pay. Because he can’t.<<

    But that debt has collateral which will be seized by the criminal TBTF&Jail DMMFM-C cabal.

    How to Be a Crook

    #27564

    TheTrivium4TW
    Participant

    >>“…for the fault is in ourselves.”
    This is the most important observation, the elementary particle. We are inherently defective and contradictory beings. The best we can do is to understand how this frailty manifests itself in cyclical changes through time and to proactively position ourselves within the evolving structure.<<

    seychelles, but what is the fault? You’ve identified the source of the fault, but what is the fault itself that needs to be corrected?

    Can it be summed up thusly, from top (DMM arch villain) to bottom (Joe and Jane 6-pack), “Individuals do not care about others equal to how they care about themselves.”

    BTW, that insight didn’t originate with me – I’m just parroting it because I believe it to be correct.

    #27565

    Raleigh
    Participant

    “We’re going to see a lot of ‘hidden’ protectionism going forward. Globalization is now turning against individual nations.”

    Isn’t it about time that globalization was kicked to the curb? Aren’t “individual nations” what the establishment has been trying to obliterate? It seems that someone else (usually unelected bodies like the World Trade Organization, the U.N., Bank for International Settlements, central banks, the up-and-coming trade treaties, etc.) gets to dictate what an individual nation has to do. And when people finally have enough of this crap and rise up, they’re called protectionists, racists, fascists, unintelligent. Or the people are told, “But at least you have a democracy and you get to vote for your candidate,” but the establishment neglect to mention that they, not you, gets to select the candidate. How’s that for democracy?

    China already has tariff protection, and yet they get to ship product into the U.S. with little to no trade protection. That’s why the system has worked the way it has. Increased profits when the multinationals ship product back into the U.S. AND tax relief. Great system. Think I’ll try that, then I’ll post from jail.

    Nice racket if you can get it.

    #27566

    seychelles
    Participant

    “Individuals do not care about others equal to how they care about themselves.”
    Oh my such a cynical view! But the self IS the ultimate identity group. The faultS…I did not introduce “fault” into the blog BTW…are TNTC but include greed, unfairness, shortsightedness, dishonesty, racism, lack of introspection and lack of discipline. These are consequential to our genetically-determined basis for “cognition”, which induces maladaptive thoughts and behaviors as refuges from madness.

    #27567

    Raleigh
    Participant

    seychelles – as in we think too much and love too little? Too much ego, and too little consciousness? And if things were reversed, we’d be thinking that “all men are my brothers”, we’d become enlightened? Is that what you mean?

    #27568

    seychelles
    Participant

    Raleigh
    Maybe too much consciousness and too little truth-and-understanding modulated subconsciousness. “All men are my brothers” is utopian dreaming except at the level of “we are all made from the same clay.” Toynbee emphasizes that “long-term” successful societies have been supported by conceptual pillars of love and ethics, which I believe are the essential ingredients of a “meaningful” life.

    #27569

    TheTrivium4TW
    Participant

    hi seychelles, I argue that it is reality, regardless of what word is used to describe the discerner of that reality.
    Clearly, the Debt-Money Monopolists don’t treat the millions they impoverish and starve to death equal to themselves. I think most people on this site can get that point.
    I argue that ordinary people are smitten with the same problem. When people like me expose the human predator Debt-Money Monopolist class and the exact mechanism they use to systematically asset strip entire societies with mathematical precision, they don’t take action. Most won’t even do the middle school math and admit it is correct – and that rate appears to vary directly with level of education… the more people are schooled, the less able they are to admit an establishment organization is a fraud. How could a person who cares about others be so callous as to let an entity far worse than Ted Bundy run around on the loose without even bothering to warn people? Nobody that actually cared for other people could do that. Which is my point. It is cynical. It is also observably true. Sure, there are exceptions, but they are really, *really*, **really** frustrated people – and for good reason.

    #27578

    Babble
    Participant

    @The Trivium4 You state: I loan you $20 @ 5% interest per year. At the end of 1 year, you owe me $21 due to double entry bookkeeping adjustments that add $1 interest liability to your balance sheet and $1 interest asset to my balance sheet.
    Please tell me how you can “grow” that $20 into more money by saving and investing (or any other means under the sun) if I hold onto my $1 interest and don’t lend more money into existence.

    Simple answers but lets use a greater sum of money such a $15,000. a consumer would the buy a car so they could travel to a job which they can now work and produce an income. this is a return on investment of the loan. This can also be used for getting an education using a loan, though this can certainly be abused. Worked produced is value and is stored as money. Even depositing it into a savings account with fractional reserve allows it to be be partially loaned out again. If one assumed that the money was totally wasted or burned then this would be an obvious disaster. However, money loaned is used to purchase labor, goods and services which again produces value, all of which is used to pay back the interest and capital.

    #27591

    TheTrivium4TW
    Participant

    Hi Babble, this is a very important point. Remember, I’ve simplified the system so as to bring out a key point. There is a fundamentally flawed assumption in your scenario. If I, as the Debt-Money MONOPOLIST, only create $15,000, where oh where does the money come from that would be available to pay wages? It doesn’t exist – and that’s the point. So, no, you can’t work to pay off your debts because there is no money in which to earn BECAUSE I CONTROL THE ISSUANCE OF DEBT-BASED MONEY INTO SOCIETY.
    THAT is the point I’m making here.
    Check your premises and validate them… don’t uncritically assume them.

    Now, lets take a scenario where I create $20 billion – that’s enough to create a pretty big economy for a significant number of people. Using the same 5% interest rate, society has $20 billion, I have $1 billion, and society owes me $21 billion.
    Society has $20 billion and society owes me $21 billion. In this more realistic scenario (the same flaw is in place, though, from the perspective of ordinary people), I will only bankrupt and asset strip A PERCENTAGE OF THE POPULATION AT ANY ONE TIME, not the whole thing. Those who are able to pay their debts within the broader system will make it impossible for others to pay their debts… say $15 billion is paid back as soon as it is issued (keep the math simple, the principle is the same if paid back later, though)… then the remaining $5 billion outstanding still owes the $1 billion in interest… with access to only the $5 billion they owe because I control the $1 billion in interest required to make their debt extinguishable.

    The takeaway is that jobs don’t create money. Labor doesn’t create money. Businesses don’t create money (outside the Debt-Money Monopolist controlled banking system). No, the DMM creates money through their corporate fronts and then business and labor ALL FIGHT FOR THE MONEY THAT DMM DECIDED TO PUT INTO THE SYSTEM – AND NO MORE.

    They who control a society’s monetary system are the de facto rulers of said society.

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