Debt Rattle June 18 2015
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Wynand Stanley Cadillac touring car at Yosemite in snow 1919 • Greece Is Solvent But Illiquid. What Should The ECB Do? (Paul De Grauwe) • Greek Centra
[See the full post at: Debt Rattle June 18 2015]Soros indicates where western financial elites want to draw the lines of global monetary order.
Split China away from Russia (and Iran, not said as such) by including the Renmenbi in the SDR, as that comes up for revision this fall. He is very harsh on Russia, and outright lies about Crimea and Ukraine.
Soros argues to let the Renmenbi into the SDR, and engage China fully in the current Bretton Woods (latest revision) framework, or risk military WW-3. That is disingenuous as what I believe he fears is a loss of his global financial order.
https://www.zerohedge.com/news/2015-06-17/global-disorder-reigns-george-soros-warns-washington-mend-relations-china-or-face-wo#comment-6209159
Interestingly, he paints the Neocon “Project for a New American Century” as a failed project, a thing of the past, now.From Zerohedge:
“Earlier today we reported about a very sad development for the freedom of speech, or at least the illusion thereof, when one of, if not the best, critical Federal Reserve reporter in the mainstream media, WSJ’s Pedro da Costa found he was no longer “invited” to the Fed’s quarterly press conference. His transgression: daring to ask Yellen some very uncomfortable questions during the March 2015 press conference.”
Every other reporter ought to stand up with Pedro da Costa and boycott the conferences, but they won’t. They’ve got mortgages and cars to pay for, families to provide for. Same thing with professors. Increasingly, if they do not toe the line, they will be eliminated.
“The contingent employment that awaits many of today’s graduate students and that is the fact of life for many of today’s faculty is further conservatizing. Although all faculty are supposed to enjoy academic freedom, contingent faculty whose writing or teaching causes trouble are easily dismissed. A contract is simply not renewed, or a department chair says, “Sorry, we have no sections for you to teach,” and that’s the end of the matter. This precarious situation conduces to playing it safe, making no demands, and keeping students happy.”
Imagine how easy your job would be if everyone threw you soft lobs. With no tough questions asked, you might really be able to further your own agenda! No transparency needed – none. No dissenting opinions allowed. Keep everyone afraid of their jobs: compliant professors and journalists who never rock the boat, and because of this a public in a darker-than-dark ignorance.
“Greece’s central bank has issued a last plaintive scream before the axe falls, as if delivering an Aeschylean curse. […] Never before has such a “monetary policy” report been published by the central bank of a developed country, or indeed any country. It is a political assault on its own elected government.”
Of course it’s political, just like all of the European political appointees we’ve seen in the last few years. That central bank board ought to be hauled out of there yesterday. They were instrumental in creating Greece’s problems, and it is now crystal clear they were and are against the Greek people. Get rid of them and, while they’re at it, strip them of their wealth and estates. Let them see what it feels like to eat dog food. Of course, I’m sure all of their wealth is now safely in some Swiss bank accounts, otherwise they wouldn’t be making such statements.
“Greece’s central bank has issued a last plaintive scream before the axe falls, as if delivering an Aeschylean curse. […] Never before has such a “monetary policy” report been published by the central bank of a developed country, or indeed any country. It is a political assault on its own elected government.”
Of course it’s political, just like all of the European political appointees we’ve seen in the last few years. That central bank board ought to be hauled out of there yesterday. They were instrumental in creating Greece’s problems, and it is now crystal clear they were and are against the Greek people. Get rid of them and, while they’re at it, strip them of their wealth and estates. Let them see what it feels like to eat dog food. Of course, I’m sure all of their wealth is now safely in some Swiss bank accounts, otherwise they wouldn’t be making such statements.
“The former official said that several Greek journalists were “trained” in Washington D.C. in order to support the positions of the IMF and the European Commission in Greek media.” It’s a pretty sure bet that this is going on everywhere, on all topics. What a find! Seldom do we get to hear from these whistleblowers. These guys (elite) are idiots if they think that an elastic band does not eventually snap back with such force that they’re obliterated. I love the line from Dickens’ Tale of Two Cities:
“Along the Paris streets, the death-carts rumble, hollow and harsh. Six tumbrels carry the day’s wine to La Guillotine. All the devouring and insatiate Monsters imagined since imagination could record itself, are fused in one realization, Guillotine. And yet there is not in France, with its rich variety of soil and climate, a blade, a leaf, a root, a sprig, a peppercorn, which will grow to maturity under conditions more certain than those that have produced this horror. Crush humanity out of shape once more, under similar hammers, and it will twist itself into the same tortured forms. Sow the same seed of rapacious license and oppression over again, and it will surely yield the same fruit according to its kind.”
Just one more post, and then I’ve got to come up for air.
“The Troika’s recent abrupt shift to a much harder line seems to have emerged from the G7 meeting in Bavaria over the weekend of June 6-7. At that meeting, US president Barack Obama reportedly agreed with the hardliners, giving them a green light. […] So why the abrupt harder line and ‘take it or leave it’ proposals? […]
First, Plan A does not appear politically possible at this point, either in Greece or Germany. Second, default may in fact represent what the Germans want. Greece’s debt is unsustainable. Greece cannot repay it with more austerity. Seven years of depression is the limit and the Greek people are in rebellion against the Troika program. It is equally apparent that Greece can not ‘grow out of’ the debt, notwithstanding Syriza’s proposals to do so. Just do the numbers, as they say. With debt nearly twice the size of Greece’s annual GDP, it would take decades of continuous 3% GDP growth to pay off the debt. And given the state of the global economy, and Europe’s even worse economy, there’s no way 3% growth will continue for decades, or even for the next several years for that matter. It just won’t happen. So, if Greece can’t repay and if it can’t grow out of it, and if German politics won’t provide any more debt or allow a restructuring of the current debt that includes forgiving part of that debt—then the only option that remains is to let a crisis happen. In other words, let it go to default. […]
A default for the Troika is actually attractive in some ways. First, with its recent authority to inject US$1.2 trillion in QE, the ECB has sufficient funds to bail out northern Europe banks and bondholders who may be negatively impacted by a default. […] …a default would also reduce the value of the Euro. And that’s not all bad in the view of European export-oriented corporations. […] A default would have serious short term economic effects within Greece. Capital flight from Greece would intensify in the event of a default. Capital controls would have to be imposed. The Syriza government would most likely have to call an election, and that may be precisely what the Troika wants as well. With only a majority of 12 in the Greek Parliament, the Syriza government might just lose political control in the Parliament. A new government might prove more amenable to Troika demands, especially if a Troika engineered even deeper economic crisis in Greece is successfully blamed on Syriza and Tsipras by a Euro-wide public media barrage aimed at Syriza. No doubt the Troika’s big business supporters still within Greece would assist. […]
What we have seen in recent months and weeks is a classic capitalist bargaining strategy. If capitalists or their managers don’t like the other party’s negotiators, they undermine their reputation within their own team. The tactic is to make them appear incompetent and then go around them and have them replaced. […] Having succeeded once in sidelining Varoufakis, the Troika strategy now is apparently to create a further crisis in order to replace Tsipras himself and dislodge Syriza from a majority position in the Greek parliament by forcing Greece to call new elections. If that succeeds, it just may get the Troika a more pliable negotiating partner later this summer. In the meantime, a default crisis lowers expectations on both sides and makes compromise later this summer more possible than at present.”
Good read.
Long Beach, California and fracking:
“It’s estimated the Wilmington reserves originally contained 3 billion barrels of oil, with around 300 million barrels left in the tank today. In 1940, Long Beach began to sink as a result of so much oil being drained from beneath the city. By the early 1950s, this so-called “subsidence” phenomenon was causing the city’s elevation to drop by approximately 2 feet per year. The results were destructive: Streets cracked, pipes warped, and buildings became unsafe. The sinking even caused minor geological tremors. In 1953, Long Beach began injecting water into the oil reservoirs, and the subsidence stopped. […]
It’s safe to say the wells have been a bit of a cash cow for Long Beach, accounting for almost 5 percent of the city’s total budget–almost $80 million annually over the past two years alone. The city has used nearly every technique in the oil playbook to pump the liquid loot out of the ground, including the contentious practice known as hydraulic fracturing or fracking. […]
So why are environmental activists so worried? To begin with, they argue, fracking pollutes groundwater and excessively wastes precious supplies during a severe drought–some 70 million gallons were diverted for use in fracking last year in California alone. In fact, the California Environmental Protection Agency admitted in early February that state officials allowed more than 2,500 fracking wells to dump wastewater into protected underground aquifers, mostly in Kern County. Nonetheless, oil and gas development has been exempt from the mandatory water restrictions Brown announced in early April.”
https://www.counterpunch.org/2015/05/22/what-the-frack-is-happening-under-long-beach/
Hard to turn down this kind of money. Who cares about water restrictions and aquifers!
The Swiss option exists. A Tobin tax that captures ALL transactions, including cross-border ones. If every time a Franc passed over the border in any direction it had to pay a 3% tax, not only would that give pause to the arbitragers and safe haven searchers because they would face the reality that when they NEEDED to extract the money again they would lose another 3%, but the Swiss government would have a nice cashflow that it could use to soften the damage to Swiss social and economic activity.
BUT we all know its never going to happen so the Swiss people just better get used to living right up there on the top of the currency peak with no food, no water and a very cold wind blowing.
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