Currency Wars

Posted on May 6, 2010 by stacyherbert| 32 Comments

Stacy Summary:   As part and parcel of this year’s sovereign debt crises, the accompanying currency wars are going to cause the most noticeable consequence to the man on the street.  I have spoken to people who lived through a currency crisis and the trauma was still visible a decade later.  Anyway, no doubt this blog post from Jesse will trigger much conversation . . .

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32 Responses to Currency Wars

  2. Pez | May 6, 2010 at 8:20 pm |

    “I realize that the SDR is just another fiat currency, a somewhat artificial construct for the accounting of international trade, a fiat of fiats if you will. It may even be inherently unstable in the midst of the controlled demolition of most fiat currencies that is now underway.”

    It’s more like, the ship is going down. Which life boat should I take? hmmmm let me think. I’ll go with the lifeboat with the fat people, they’ll make good eats later!

    We’re all doomed…except the ultra-wealthy, god’s chosen ones.

  3. FiatMentalist | May 6, 2010 at 6:34 pm |

    Anytime snoot, keep laying it out there, your posts are an education for me.

    http://www.youtube.com/watch?v=bcrEqIpi6sg

  4. frances snoot | May 6, 2010 at 6:11 pm |

    @Fiat:
    Thanks. That cheered me up.

  6. frances snoot | May 6, 2010 at 2:05 pm |

    Well, Angel’s quote is this:

    “The crisis has given birth to a new and more inclusive global governance. We are all aware of this fact.”

    Does this align with Jesse’s astonishing prelate?

    “But from a portfolio perspective it could be useful to take some of the power to control the world’s money supply away from the Anglo-American banking cartel and its politicians who have proven themselves to be unworthy of such a great responsibility.”

    Did the Anglo-Americans control the money supply? What function has the BIS had within the international system? What function the exchange rate index and how will the change to a new system of exchange rate valuation affect world currency value? (change to a ‘multilateral’ system run by a central/global regulator based on inflation flucutations) Will the new governance be run from EU institutions/law?

  7. frances snoot | May 6, 2010 at 1:58 pm |

    http://www.oecd.org/dataoecd/62/41/45089607.pdf

    Remarks by Angel Gurría
    Secretary-General
    OECD
    Berlin, 28 April 20
    2010

    “The

  8. frances snoot | May 6, 2010 at 1:55 pm |

    Global governance through international law:

    http://ime.bg/en/articles/from-administration-to-stagnation-monsieur-sarkozy-s-speech-in-davos-and-the-contribution-of-the-ilo/

    (remember the insistance by Merkel/Sarkozy/Obama that a global financial system needs global governance)

    “The

  10. frances snoot | May 6, 2010 at 12:44 pm |

    We need SDRs to do international settlements? What do we need those for?

    SDR’s are the unit of account at the heart of our international financial system, Mother.

  11. frances snoot | May 6, 2010 at 12:29 pm |

    Here’s the spin on O’Niell’s paper:

    http://moneymorning.com/2010/03/19/yuan-dethrone-dollar/

    Here’s the chapter text from Chatham House:

    http://www.chathamhouse.org.uk/files/16146_r0310_ims.pdf

  14. Marc Authier | May 6, 2010 at 12:13 pm |

    Gordon’s bottom is Brown. Couldn’t stop myself. It’s soo yummy specially an election day.

  15. frances snoot | May 6, 2010 at 11:59 am |

    Of COURSE the reserve asset will not circulate like a currency: everyone knew that, right? The idea is to end imbalance between regional currency blocs (aka former sovereign territories). Unfortunately, the inordinate privilege will extend to those who retain assets denominated within the sdr unit. Those would be the same criminals who fostered their own advantage through basel regulations.

    Oh, I’m speculating.

    No wonder the press is sucking up more than ever: well, is it preferable to be a barnacle on the lifeboat? (I think not: when do you get a breath of fresh air?)

    Neo-colonialism is being pursued in every form through the ‘aide’ being giving to the emerging economies via IMF SBA/credit facilities/sdr transfers.

    O’Niell talked about the yuan being traded on the forex. (hahahaha) What a lie. These guys don’t want to share their export profit: its their own trade ‘currency’: they’ll give us ‘our democracy’ instead of access to liquidity.

    When does the shtf? Santa says Christmas (sdr reweight, yuan added?):

    “FT: Is there going to be a tipping point, a moment at which the dollar is fatally weakened? Or does it just sort of carry on?

    GS: As long as the renminbi is tied to the dollar, I don’t see how the decline in the dollar can go too far. Now, of course, to some extent it’s very helpful because with the US consumers saving more and spending less, exports can be way for the US economy to be balanced. So, an orderly decline of the dollar is actually desirable.”

    http://www.ft.com/cms/s/0/6e2dfb82-c018-11de-aed2-00144feab49a.html?catid=20&SID=google&nclick_check=1

    (That would be George Soros, not Goldman Sachs…funny they have the same initials!)

  16. The Dork of Cork | May 6, 2010 at 11:32 am |

    Yes I believe silver is going to crash and gold to soar as the US stock market crashes.
    I just hope that my Euros hold some value as I wish to pick up silver on the cheap.
    US companies are very dependent on Euro revenue – in Ireland we are very familiar with this process as we are essentially a conduit for US companies who wish to channel revenues back to New York.

  19. Martijn | May 6, 2010 at 10:59 am |

    Has the UK treasury already released the info regarding Brown’s bottom it was supposed to?

  20. Marc Authier | May 6, 2010 at 10:56 am |

    British election results today. Hope we will have some fun with the hanging of parliament. “Parle et ment” Parlement we say in french. “Talk and lie”.

  22. Marc Authier | May 6, 2010 at 10:44 am |

    The British are about to hang their parliament. Good idea. I got some real strong rope if you need some. :)

  23. FreeMarkets | May 6, 2010 at 10:38 am |

    It looks as though Greece is falling to the Empire along with Poland

  24. Troy Ounce | May 6, 2010 at 10:38 am |

    Jesse is great.

    Yeah, we’re being ruled by a bunch of cynical gangster.

    We, with the help of the internet, will destroy them, though.

    Transparency to the financial gangsters is like the mirror to count Dracula

  25. Mother Earth | May 6, 2010 at 10:37 am |

    We need SDRs to do international settlements? What do we need those for?

    This is like “You need the Starwars cape to go with the starwars gun”.

    You don’t need the frikin gun.

  26. FreeMarkets | May 6, 2010 at 10:36 am |

    @FiatMentalists – I agree with you – fork tongue and all that. Very close to the intl’s!

  27. FiatMentalist | May 6, 2010 at 10:03 am |

    Niall Ferguson is a professor historian/banker cheerleader/hedge fund adviser insider type. I personally wouldnt trust him.

    http://en.wikipedia.org/wiki/Niall_Ferguson

  28. Creative Destruction | May 6, 2010 at 9:39 am |

    @ Mike/Liverpool

    Reminds me of the line by Hemingway about one of his characters going broke – very slowly at first, then all at once.

    And one more thing: gold is not getting killed, fiat currencies are killing themselves softly. Gold is just a temperature gauge.

  30. Creative Destruction | May 6, 2010 at 9:31 am |

    @ Ptah

    Turn that frown upside down. That’s what the banks did when they made the governments eat their losses.

  31. Creative Destruction | May 6, 2010 at 9:30 am |

    @ Stacy,

    Check out Schoon’s latest article. I think he would make an interesting guest:

    http://www.drschoon.com/articles/AmericaAtTheCrossroads.pdf

  32. Ptah | May 6, 2010 at 9:28 am |

    Last – feeling pessimistic today …