No Bank Collapses Before September?

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bail inThe Cyprus model of theft “bail-in” bank collapses is slowly being adopted globally as the solution to enable bankrupt sovereign nation states deal with bankrupt banks. Japan is the latest country to consider such a move, even the EU is about to adopt the policy, but all eyes will be on the G20 in September. It’s strongly suspected that the G20 will announce theft “bail-ins” as the solution to deal with bank collapses. That countries (New Zealand, EU, Canada, UK) have openly being discussing such a drastic solution shows there is expected to be a raft of banks collapsing in the near future.

I have been reporting for some time now that a number of central banks have already published policy documents detailing how bail-ins would work. The Bank of Canada, Bank of New Zealand, and the FDIC and Bank of England jointly, have all published something on the issue.

At its heart is the idea that savers are, in fact, “unsecured creditors” of the banks, and therefore come second only to shareholders should their assets need to be confiscated in order to keep a failed bank going for a little while longer.

Yesterday, Nikkei highlighted that Japan’s Financial Services Agency will enact new rules to force failed bank losses onto “investors”. 

The Japanese Parliament ratified the proposals yesterday.

Also yesterday, Sergei Storchak, a Russian Deputy Finance Minister stated that there would be a declaration by heads of state attending Septembers G20 meeting in St Petersberg which would bring an end to the policy of taxpayer bailouts. The implications of what he said was that the G20 would also be jumping on the bail-in policy instead.

The preparations for widespread confiscation of assets are nearly complete.

Source: UK Column, ZeroHedge

Irish Finance Minister Noonan Proposes Bail In Policy

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Noonan's gesture to depositors

Noonan’s gesture to depositors

Under the presidency of the EU, the Irish finance minister Michael Noonan(2012 Bilderberg attendee) has proposed making the Cyprus theft “bail in” using deposits over €100k policy for future bank collapses. The BIS sets the banking agenda and they want depositors raped when banks collapse along with using “bail ins” to pay for bankers remuneration (big bonuses) according to a recent paper. Judging by the state of European banks, a lot of people are going to have their wealth wiped out and everyone will be at the same wealth level in the Orwellian EUSSR.

Deposits of over €100,000 are likely to be hit in the event of future European bank collapses, according to a proposal put forward by the Irish presidency of the European Council ahead of a key meeting of finance ministers next week.

Discussions on the controversial bank resolution regime, which is likely to see savers with deposits over €100,000 “bailed in” as part of future bank wind-downs, are due to intensify this week in Brussels, ahead of Tuesday’s meeting, which will be chaired by Minister for Finance, Michael Noonan.

“We will try to get some guidance from Ministers about the possible design of the bailout tool,” one EU official said yesterday.

Under a compromise text proposed by the Irish presidency, uninsured deposits of over €100,000 would be bailed in in the event that a bank is resolved, but depositors would rank higher than other creditors in the event of a wind-down.

In this scenario – known as “deposit preference” – depositors would rank at the very end of the process, with other creditors first absorbing losses.

However, some member states have not ruled out the possibility that insured deposits, i.e. deposits under €100,000, would be forced to bear losses in the event of a bank collapse even though these deposits would be likely to be protected by the deposit guarantee scheme.

However, the explicit exclusion of insured deposits from future “bail-ins” could in fact be included in the final text, according to some sources, with some MEPs in particular keen to include such a provision.

Significant differences still remain between states on the issue, with some countries calling for greater flexibility as regards the application of the new rules on a national basis, including the possibility that individual countries could be permitted to exempt large depositors from losses if a bank fails.

The introduction of an EU-wide bank resolution process, which would govern how banks are wound down, is a key strand of the EU’s plan for a pan-European banking union, which was endorsed by EU leaders at last June’s summit.

However, the chaotic Cyprus bailout instilled the issue with greater urgency, with EU lawmakers now keen to provide clarity around bank collapses.

Moving the burden
This year Jeroen Dijsselbloem, head of the group of 17 euro zone finance ministers, said that losses on bondholders and depositors could form part of future bank bailouts as euro zone officials seek to move the burden of bailouts away from taxpayers – as was the case in the Irish bailout – and on to private investors.

The European Commission argues that this switch from so-called “bailouts” to “bail-ins” would result in an allocation of losses that would not be worse than the losses that shareholders and creditors would have suffered in regular insolvency proceedings that apply to other private companies.

While the inclusion of large savers in future bank bailouts is now widely accepted, significant differences still remain between member states.

While the new rules governing bank resolution were first intended to come into place in 2018, since the Cypriot bailout there have been calls from senior EU figures such as European Central Bank president Mario Draghi and EU economics affairs commissioner Olli Rehn to introduce the new regime as early as 2015.

The Irish presidency of the European Council is hoping to reach a common position by the end of next month.

Noonan demonstrate how much you will be left with under the EU plan

Noonan demonstrates how much the EU/Banks intend you will be left with under the plan

 

 

 

 

Source: Irish Times, BIS

Jim Sinclair: Elites Plan To Control The Masses

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As growth grinds to a halt Worldwide, debt levels increase  and unemployment queues continue to grow longer, someone always profits from a collapsing system but the question remains, was it by design or accident? For the US to go off the Gold Standard and dump unlimited dollars into the global financial system coupled with a massively over leveraged banking system, were we not always going collapse under he weight of fiat currency and toxic derivatives? Jim Sinclair goes even further to suggest it was no accident but a frightening plan to control the masses. It may not be too far from the truth, especially when you read Matt Taibbi’s article “Everything is rigged”.

One thing is for sure in light of the Cyprus decision to confiscate deposits and having seen a similar move in the US regarding MF Global customers, you have got to be forewarned when the inevitable collapse comes your way.

The enormous violence in the markets is obscuring a very clear message.  The message from Cyprus, that has also been written in various white papers and signed by central banks, the FDIC, Bank of England, and the BIS, is to get out of the system.

….

People have to understand that going forward large deposits by ‘non-insiders’ are no longer going to be permitted.  The goal of this pre-arranged wealth destruction is to equalize the ‘new rich’ and the ‘upper middle-class.’  Those not on the inside, with the right families and the right companies, are not going to be tolerated in the ‘New Paradigm’ of currency and metal that we are now moving into.

 So the only means of being able to protect yourself will be to understand the answer to the question, ‘What is the final end game for the most powerful families that are in fact running countries and markets?’….

“Take into consideration that the recent and violent drop in the gold price, especially if followed by an equally violent recovery, was primarily for the transfer of physical gold from financial and other entities to the families that are running the Western governments and financial world.

In my opinion that’s exactly what has just happened.  A very strong and immediate recovery, that is sustained, makes the message clear that gold is an ingredient for these wealthy families to maintain their wealth and power, not simply over a generation, but over multiple generations.

We are coming very close to a point where the manufacturing of unprecedented amounts of fiat currency has to have a global impact.  You simply can’t increase the amount of currency as violently as what been done, without having to face the consequences, one of which is the collapse of the purchasing power of those fiat currencies.

The massive and ongoing currency war the world has been witnessing may come to a head much sooner than any of us realize.  So investors must have an understanding of how the system will be preserved, and eventually reset, in order to survive the coming wealth destruction.

Maintaining significant deposits inside banks in the current financial system is setting up that portion of your wealth to be destroyed or stolen from you.  Whereas maintaining physical gold inside a private storage, outside of the banking system, is one of the ways you can survive what is coming.

Physical gold will be the primary beneficiary of the ‘Great Unwind’ that is still in front of us.  This is why the latest attempt to smash gold in the paper market was met with one of the most ferocious physical buying sprees the world has ever seen. 

 Owners of physical gold may end up being the quality non-North American gold companies, as well as individuals which move out of fiat money and into physical gold while the price is cheap.  From now on every dip you see in paper gold will be met by a corresponding move by savvy investors around the world to trade in their fiat money for physical gold.  

“The time to get out of the system is immediately in order not to be destroyed by the ‘Great Equalization’ that is about to take place”.

This phase will serve to bring humanity to its knees.  It is going to be about control of the masses, for the benefit of the few.

Derivatives will be a primary tool for the destroyers of wealth, and bank deposits all over the Western hemisphere will be invaded. So investors must get out of the system and have physical gold and gold related investments in order to survive what is still to come.”

“The price of gold is going to significant new highs, and that drive to new highs will be as a result of a continued move into physical gold.  Because the manipulative tool of the paper market has been revealed as a fraudulent determiner of price, the physical gold price will now be free to move to levels that even you and I will be surprised at, and it will be maintained at that level for generations.”

Source: King World News

Solvenian Banks Close To Collapse

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After Cyprus, next up looks to be Slovenia. Over the weekend there has been an official denial that the banks are about to collapse and we know what that means. If it does turn out to be the case, then another  “bail in” would cause panic right across the Euro area.

 

SloveniaTYE2012Are Slovenian depositors about to get Cyprus’d with a wealth/deposit confiscation?  If the intensity of the denials by Slovenian officials are any indication, a bank crisis is imminent for the tiny balkan nation. 
New Prime Minister Alenka Bratusek attempted to calm Slovenians over the weekend stating: We are absolutely no Cyprus. We don’t need help. All we need is time.
If and when the 2nd bail-in episode in the EU is attempted, expect all hell to break loose across the European banking system as depositors in Greece, Italy, Spain, Portugal, and even France realize that as DISELBOOM openly admitted, Cyprus really was the template for bank failures going forward.

As the AP reports, the official denial is in:


Slovenian officials have a message for the world: Don’t panic — we won’t be the next to fall.
The tiny European Union member is trying to convince its people and foreign investors that it won’t be the next in line for a banking system collapse and a messy international bailout.
“We are absolutely no Cyprus,” says new Slovenian Prime Minister Alenka Bratusek. “We don’t need help. All we need is time.”

Contrary to PM Bratusek’s claims, a recent report by the Organization for Economic Cooperation claims that the equity in Slovenian state banks has been “virtually wiped out.”:

The Alpine country’s banks have been on a lending spree for years, loaning money to unprofitable state companies or privileged officials who used the cash to buy the firms they ran, using the state assets as collateral.
Many such businesses have now collapsed or have huge debts. A recent report by the Organization for Economic Cooperation says that the equity of the state banks has been “virtually wiped out.” As much as 15 percent of all loans are now non-performing, the third-highest ratio in the eurozone, the Paris-based group said.

Which brings us to the important question: Exactly how much gold does Slovenia supposedly own as its reserves that are about to be confiscated by the ECB?  3.20 tons according to Slovenia’s latest report…all likely stored in London and already rehypothecated and leased to bullion banks 1,000 times over.

Que the MSM reports that Slovenia’s 3.2 tons of gold will need to be liquidated.

Source: SilverDoctors

Canada Plans To Use Cyprus Model For Broken Banks – Rob The Depositors

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Looks like the Cypriot model of using depositors money to bailout insolvent banks is being adopted by Canada. New Zealand has similar plans and if you listen to the Dutch Finance Minister, eurozone countries willsimilarly being robbing your money when banks are finally allowed to announance they are bust.

SD has been alerted to an alarming provision that has been buried deep inside the official 2013 Canadian Budget that will result in depositor haircut bail-ins jumping to this side of the pond during the next bank crisis!
Titled ECONOMIC ACTION PLAN 2013 and tabled in the House of Commons by Minster of Finance James Flaherty on March 21st, the official 2013 Canadian budget contains an explicit provision that Canada will pursue the bail-in model for systemically important banks for future bank failures!

Depositor haircuts have just jumped to this side of the pond, effective the next bank crisis/ failure:
From Page 144:

“The Government also recognizes the need to manage the risks associated with systemically important banks—those banks whose distress or failure
could cause a disruption to the financial system and, in turn, negative impacts on the economy. This requires strong prudential oversight and a robust set of
options for resolving these institutions without the use of taxpayer funds, in the unlikely event that one becomes non-viable.”

Translated, Without the use of taxpayer funds means via depositor funds.

And the meat of the provision, from Page 145:

The Government proposes to implement a bail-in regime for systemically important banks. This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital.
This will reduce risks for taxpayers. The Government will consult stakeholders on how best to implement a bail-in regime in Canada.
Implementation timelines will allow for a smooth transition for affected institutions, investors and other market participants…

Confiscating wealth from depositors will reduce risks for taxpayers???  Only those with 100% of their assets in physical gold and silver, or those Canadian depositors who are somehow not also taxpayers perhaps!
The bail-in provision in Canada’s 2013 budget can be found on pages 144,145:
http://www.budget.gc.ca/2013/doc/plan/budget2013-eng.pdf

Source: Silver Doctors

How Russia Could Take Revenege Over Cyprus Deal

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Europe has already had a taste of what Russia can do in 2009, due to the dispute with Ukraine over an unpaid gas bill. That winter the tap was turned off and maybe that was point, to remind Europe not to cross Russia in future. Steve Keen in this CNBC article takes a look at the possible way in which an angry Russia can hit back.

putinGermany might be telling the world not to blame it for Cyprus’ bailout plan, but one analyst told CNBC that Russia could avenge the loss of billions of dollars it has invested and deposited on the island by cutting Germany’s energy supply.

As the Cypriot parliament prepares to vote on a controversial and unprecedented proposal to levy a tax on bank accounts held on the island, the deal has been described as a covert move by Germany and its euro zone partners to tackle what they perceive as Russian money laundering in Cyprus.

Twenty percent of total deposits of the Cypriot banking system are held by Russians and many Russian businesses are registered in Cyprus, making any plan to levy a 15.6 percent tax on deposits over 100,000 a moot point for Russia. The country has also given Cyprus a $3.3 billion loan that Cyprus wishes to extend.

Russia’s leaders have already condemned the European bank levy proposal, with President Vladimir Putin calling it “unfair, unprofessional and dangerous” on Monday. On Tuesday, Russian Prime Minister Dimitry Medvedev added to the growing Russian frustration over the move. “Quite strange and controversial decisions [are] being made by some EU member states. I mean Cyprus. Frankly speaking, this looks like the confiscation of other people’s money,” Medvedev said on Monday.

Steve Keen, professor of Economics & Finance at the University of Western Sydney, told CNBC that Russia could retaliate against the perceived proxy attack on its citizens, and their money.

“If you try to target the Russians, and there’s President Putin acting under the image of the ‘strong man’ of Russia, why would he not then decide to shut down gas supplies to Germany until that was righted?

“If you’re going to attack money laundering then attack it directly, don’t make Cypriot peasants and small businessmen collateral in your campaign against Russian oligarchs. Declare the campaign rather than doing it under the carpet like this too,” he added.

“Russia has been willing to play that card before,” Keen said, alluding to when Russia’s largest state-owned gas and oil supplier Gazprom reduced gas supplies to Europe in 2009 during a dispute with an Ukrainian energy company.

With 36 percent of Europe relying on Russia for its gas supply, the threat or act of limiting supplies gives Russia a powerful card to play should it wish to push home a political point against Germany.

“It is an explosive political situation,” Nick Spiro, head of Spiro Sovereign Strategy, told CNBC. “This is a rubicon which should have never been crossed…This bailout agreement has Germany’s political fingerprints all over it,” Spiro told CNBC Europe’s “Squawk Box.”

“If Germany’s aim was that the larger deposit holders, the Russian ones, were going to bear the brunt of this, then obviously it’s backfired,” he added.

Steve Keen told CNBC that the proposal was tantamount to “blowing the brains out of capitalism” and such a proposal would destroy the euro and the idea of a monetary system.

“It’s mind-boggling that German bureaucrats and politicians can think that this is a sensible way to share the pain,” Keen said. “If you destroy the trust that depositors have in their bank accounts, you fundamentally destroy the oil of capitalism.”

“This is an absurd decision which has to be blocked somehow. If the Russians block it or the Cypriots block, somebody has to block it,” he said, ahead of a crucial debate in the Cypriot parliament over whether to ratify the plan.

Approving the plan is central to Cyprus receiving a 10 billion euro bailout from the European Union and International Monetary Fund (IMF) but as yet, the outcome of the vote is uncertain.

The Cypriot President Nicos Anastasiades reportedly told German Chancellor Angela Merkel and the European Union’s economics affairs commissioner Olli Rehn on Monday that he would stand by what was agreed at a euro zone finance ministers’ meeting last week but “insisted that EU partners offer some additional help,” a state spokesman, Christos Stylianides, told state radio on Tuesday.

(Read More: Cyprus President Is a ‘Fool:’ Gartman)

Stylianides added that President Anastasiades is also likely to talk to the Russian President, Vladimir Putin, on Tuesday.

Against a backdrop of protests in Cyprus and sharp declines in global equity markets on Monday, the German finance minister attempted to deflect blame from his country, saying the solution had not been a German idea and that he was open to it being changed.

“The levy on deposits below 100,000 euros was not the creation of the German government,” Wolfgang Schuble told reporters in Berlin on Monday. “If one reached another solution we would not have the slightest problem,” he added. On Tuesday, however, Schuble said that Germany pressed for a “bail-in” of Cypriot depositors to protect European taxpayers.

Source: CNBC

Swiss Referendum To Repatriate Gold?

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Germany has ratcheted up the pressure on other countries to repatriate their gold reserves. The latest country to press  its Central Bank over gold reserves, is Switzerland. Of course they are unique in that they have true democracy unlike the corrupt Dumb-ocracy version the rest of us have. In Switzerland they can force a referendum  if they can get over 100,000 petition signatures. In this instance its the Swiss National Bank that the people are unhappy with and have 3 demands. Now thats real democracy 🙂

With last week’s announcement by the Bundesbank of the repatriation of 674 tons of German gold from Paris and NY over the next 7 years, we predicted that an avalanche of gold repatriation requests would soon be made to the BOE and the NYFed. 
It appears that Switzerland may be next to the game, much to the dismay of the SNB.  The Swiss gold initiative, an initiative to Secure the Swiss National Bank’s Gold Reserves, launched in March 2012 by four members of the Swiss parliament, has grown to 90,000 supporters. 
Once 100,000 supporters are achieved, the Swiss Parliament must take up the referendum. 

The initiative asserts that the Swiss people should have a right to vote on 3 things, none of which will please the banking cartel:

1. To keep Swiss gold physically in Switzerland (ie repatriate Switzerland’s gold)
2. Preventing/forbidding the SNB from selling any more of its gold reserves
3.  Requiring the SNB to massively increase their gold holdings to a minimum of 20% of its reserves within 5 years, held within Switzerland.

Not surprisingly, the Swiss National Bank doesn’t wish to disclose where it’s physical gold is held, but it may soon be forced to once the initiative achieves 100,000 supporters. 

674 tons repatriated here, 1040 tons repatriated there, pretty soon we’re talking real money!

Checkout google translate of article from Post Finance

Gold initiative prepares the SNB headache
by Lukas Hässig – home to Switzerland must get their gold from abroad? The SVP initiative calling for the missing, only 10,000 signatures. The SNB could get into trouble.

“Already in March 2013 is the deadline for the submission of Gold initiative,” wrote the St. Gallen SVP National and co-founder Lukas ReimannAlthough it was with some 90,000 signatures on its way. “But to crack the necessary 100’000, now the use of all is needed.”

Where are the 1,040 tonnes of gold the Swiss National Bank? The question is now being seriously discussed with us. The response of the SNB remains nebulous. Most of it is here, but some lie abroad, said the central bank.We do not want to be precise,” says SNB spokeswoman Silvia Oppliger. “Maybe we will express more precisely, should the gold initiative come about.”

German gold repatriation provides in USA for red heads

The German Bundesbank initially thought that she needed to accept the emotional issue any further. But so are a growing number of applied citizens and politicians were not satisfied. They put the central bank so long under pressure until it gave way recently. Now bring the Germans back 674 tonnes of gold from the U.S. and from France to England. This corresponds to a value of 27 billion euros currently.

The large gold repatriation of our northern neighbor provides worldwide headlines. «Germany Moving Its Gold Back Home To Satisfy The Paranoid”, headlines the U.S. Internet newspaper Huffington Post; pure populism to appease a population that is seeing ghosts. In Germany, had previously taken hold doubt the actual existence of the gold that is stored in the gold vaults of the Americans. The bars may indeed be covered with a thin layer of gold and otherwise consist of inexpensive iron was feared.

SNB would have to buy up to 100 billion gold

Interestingly, Switzerland has been a long time before the Germans and taken without public vertebral the topic. Circles from the People’s Party launched 16 months ago, the gold initiative. Because the project in parliament remained chance would just started as the last remaining means an initiative, the initiators said then. By referendum, they want to force the SNB to store all the gold in Switzerland and sell no single ton more. In addition to the SNB within 5 years after voting to increase their gold holdings massively so that it accounts for a fifth of the minimum in the whole balance.

At current prices, the rest would go into the money. Currently, the share of gold in all the assets of the National Bank is only at 10 percent. If the SNB reduced its balance sheet is not strong, then it remains a possible adoption of the initiative no other choice than double its gold reserves to 2000 tonnes.

A ton of gold currently costs about $ 55 million. Now can be expected: 2000 tons came to 110 billion dollars, equivalent to about 100 billion francs. By comparison, the SNB now has a capital of 62 billion francs. This does not include higher gold prices that could arise due to the demand of the SNB.

Headache at the guardian of the currency

Where did all that money to come for gold purchases is not clear. It would be nice to reduce the mountain of about 170 billion euros in order to buy gold bars. Only it would take for the many Euros first buyer, and the single currency would yet remain so stable that billion-sales of the SNB would not immediately strengthen the franc against the euro again. This consideration alone makes it clear that the gold initiative although many Swiss arrives, but whose implementation the responsible persons would cause big headaches.

Source: Silver Doctors, Post Finance

Time For Ireland To Default

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David McWilliams writes of Greece’s latest debt deal and how the smart option for Ireland now is to default. Of course when the country is run by school teachers and ex unionists there is no chance, as their only focus is securing funds to pay public sector wages as well as their own.

McWilliams has consistently argued against Irelands odious bank debt which lets face it is just being paid back for bondholders who gambled badly. Now is the time to push for a debt deal. Unfortunately the Presstitutes refuse to debate openly the merits of reneging on payments to bankers. Equally discussion of pulling out of the euro has been muted least it catch on.

ireland toxicbankGreece has defaulted again, and the financial markets have shrugged their shoulders. The euro remained unchanged versus the dollar. The Greek stock market even rallied. What does this tell us? It tells us that, as this column has argued again and again, the markets have no memory. Because it improves the overall position of a country, a debt restructuring will be welcomed since it adheres to the golden rule: a broken balance sheet is made better by less debt not more debt.

The media is reporting this as a “deal” in Greece. It is not, it is yet another default from a country where the economy is destroyed and needs to be nursed back to health rather than punished.

The big news for Greece and for us is that the troika has accepted that the country must be healthy in order to pay debt. This logic applies to Ireland too. Before we focus on the implications of the latest Greek default for us, let’s look at the broader picture. And before you think that I am advocating we follow the Greek route, I am not, I am simply pointing out the reality of the global economy and the realpolitik at the centre of Europe.

Effectively, the troika and the Europa group of Greece’s creditors have “agreed” (rather they have had their hands forced) to restructure their bailout loans. Interest rates will be lowered and even deferred to give Greece breathing room.

The crux of the agreement is that Greece’s debt-to-GDP ratio should reach 175pc in 2016 and 124pc in 2020. So 120pc has become the new sustainability.

It has also calculated that this is how capitalism works. In a crisis, the debtor and the creditor suffer, they both lose out and that’s how the system works. It is called co-responsibility.

The eurozone’s economy is in tatters, carrying too much debt, unable to grow. Italian consumer confidence has fallen to a record low this month. It is now at the lowest level since the series began in 1996. The only countries that seem to be keeping their necks above water in Europe are Bulgaria, Romania and Poland. This is hardly a reassuring picture, is it?

As the great deleveraging continues and unpayable debts can’t be paid, it would be surprising if Athens is the only government to choose to face down its creditors.

This all brings us here to Ireland as we continue to squeeze the economy dry, foisting austerity upon austerity and the local economy falters. Next week will be more of the same. We have been at this for five years now and there is no sign of recovery. It is increasingly clear that the Irish domestic economy will not recover as long as the crushing debt burden on the country’s young workers is not lifted.

And as we all buy and sell to each other in the local economy, your spending is actually my income and my spe- nding is your income. And if we all stop spending at the same time and the Government exacerbates this by slashing spending simultaneously, who is spending? And if no one is spending, who is earning? And if no one is earning, who can possibly be saving without earning?

So you see that what sounds good for the individual, such as “I am saving”, is only good for me if others continue to spend; if we all save at the same time, there is no income.

Now as these macro-economic targets that the Government and the troika set themselves are always debt expressed as a percentage of income, if our income is falling because no one is spending, then debt expressed as a percentage of income will be rising, not falling.

Now is the time to push for a debt deal, instead of the excuses pushed by the government for nearly two years as to why they haven’t.

This is why there has to be a debt deal for these hundreds of thousands of mortgages underwater. We already have 128,000 mortgages in arrears. This figure is rising consistently. There are 400,000 tracker mortgages which will only get more expensive as interest rates eventually rise over the course of the mortgage. These people will face default when this moment arrives and our banks will be bust again.

Now is the opportunity, when the EU is doing deals all over the place, to propose a big bank solution for Ireland’s mortgage debt. Such a deal would aid the Irish recovery, the EU would have the victory it so craves and ordinary Irish people would have the debt relief they so desperately need.

This would allow the economy to breathe again and it could be made the centrepiece of Ireland’s EU Presidency in the next six months. The EU President sets the EU agenda for the period when it has this role. Let’s not miss this chance.

Otherwise Ireland will become known as the country that never misses an opportunity to miss an opportunity. The Greek deal is an opportunity; let’s not throw it away.

Source: David McWilliams

Banks And The Elites To Benefit from Cyber Attack

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A lot of noise has come out of the US in the past couple of years regarding the possibility of cyber attacks. But the important question is who benefits most from this. The simple answer is the banks and elites who can blame the false flag cyber attack as the cause for the impending collapse of the financial system while at the same time having the excuse to implement whatever solution they already have undoubtedly  lined up. This also gives reason to impose restrictions on the internet, which could be used to label any criticism/descent as terrorism hence a clampdown on free speech. 

Nice theory, but if one does occur we know who benefits most.

Here’s what they would get, and what you would lose…  

1)  A Cyber Attack Would Divert Economic Blame Away From Banks And Government

The Federal Reserve created the powder keg atmosphere within our financial system that we experience today using artificially low interest rates which allowed fiat money to be fed into sure-loss housing loans and toxic debt derivatives.  The credit crisis and housing collapse NEVER could have occurred without the direct aid of central bankers.  International lenders like JP Morgan and Goldman Sachs knowingly issued these toxic derivatives into the system while betting against them on the open market in an outright act of fiscal sabotage on numerous countries from Greece to the United States.  Ratings agencies ignored the blatant dangers inherent in the derivatives market and gave toxic securities coveted AAA status.  The SEC, which is supposed to stand guard against this brand of corruption, instead looked the other way, rarely if ever investigating whistleblower complaints against the “Too Big Too Fails”. 

When the American economy collapses (and it will) under the intense weight of this criminality on every level of the market process, the public will come after the banks and those politicians who helped them – unless a scapegoat is offered as a distraction.  A “cyber attack” on our banking system would give perfect cover for the banksters, allowing them to blame the collapse (which was going to happen anyway) on Iranian “terrorists”.  With their new victim status, international banks can then step in as the wounded but valiant “saviors” of the global financial system, centralizing even more power into fewer hands, issuing their new world reserve currency (the SDR) in the wake of a disintegrating dollar, focusing regulatory control within the IMF, all while the foolish populace chases after Muslim boogeymen.

2)  A Cyber Attack Gives Pretext For War

The argument for preemption against Iran over a nuclear weapons program that has never been proven to exist is simply ineffective and childish.  Globalists are beginning to realize that they have overplayed the “expert” card, and dropping a guy in a suit in front of a camera to tell Americans who to bomb is not quite working out like it did a decade ago.  Why not?  Because ten years ago Americans were still reeling from 9/11.  Globalist think tanks like the Washington Institute For Near East Policy now openly call for new attacks to be fabricated (false flag attacks) in order to frighten the American people into supporting a new war against Iran:

The interesting thing about the concept of a cyber false flag is that it leaves no physical fingerprints for average citizens to investigate.  Skeptics who suspect that our own government is the engineer of the attack might never be able to see the virus, coding, or transcripts of the event.  It is much easier to hide a collapsing network infrastructure than it is to hide a real building collapsing at near freefall speed (Building 7) without the aid of a crashing airliner.  With no physical or visible evidence whatsoever, a cyber false flag can be blamed on anyone, and the public will have to take the government at their word.

3)  A Cyber Attack Gives The Government Rationale For Internet Controls

Our government, regardless of which party occupies the presidency, has been chewing through concrete in an attempt to gain regulatory power over the internet and its content.  SOPA, CISPA, the Cybersecurity Act 2012, and on and on.  They do not hide the fact that they want to clamp down on the web, especially the web’s massive independent media presence, which the DHS often refers to as “extremist propaganda and recruitment”.  A cyber attack gives web totalitarians the perfect excuse to fence in our creative commons and silence activist media.  I can hear it now:  “The open and unsecured nature of the internet has given terrorists and terrorist states free reign to attack vital U.S. infrastructure, and it must be restricted for the greater good of the country…”

4)  A Cyber Attack Can Go Global

A cyber attack does not have to be limited to a single country and its networks.  It could be used to strike multiple countries and fuel a global firestorm of systems failures.  Globalists need a macro-crisis, a world-wide catastrophe, in order to present their “global solution” to the desperate masses. This solution will invariably include more dominance for them, and less freedom for us.  A global crisis can also be used to manipulate various cultures to forget concerns of sovereignty and think in terms of one-world action.  Surely, a worldwide breakdown can only be solved if we “all work together and all think alike”, right…? 

Without a doubt, a cyber attack serves the interests of elitist entities and banking monstrosities like nothing else in existence.  Set off a nuke, start WWIII, turn the U.S. dollar into stagflationary dust; a cyber attack tops them all, because a cyber attack can lead to them all while maintaining deniability for the establishment.  The fact that whispers of cyber threats have turned into bullhorn blasted propaganda should concern us all. 

Are we being conditioned for a cyber event in the near future?  That remains to be seen.  However, none of us should be surprised if one does occur, especially in light of the many gains involved for globalists, and all of us should be ready to dismantle and expose any lies surrounding the event before the American public is whipped into a 9/11 style frenzy yet again.

Source: ZeroHedge

Ecuador Demands Repatriation Of One Third Of Its Gold Holdings

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Venezuela was first, then in the last week we heard Romania and Germany were looking to repatriate their gold. Now ZeroHedge reports similar moves by Ecuador. 

Ecuador’s government wants the nation’s banks to repatriate about one third of their foreign holdings to support national growth, the head of the country’s tax agency said.

 Carlos Carrasco, director of the tax agency known as the SRI, said today that Ecuador’s lenders could repatriate about $1.7 billion and still fulfill obligations to international clients. Carrasco spoke at a congressional hearing in Quito on a government proposal to raise taxes on banks to finance cash subsidies to the South American nation’s poor.

…….

Because while Ecuador, with its 26.3 tonnes of gold, may be small in the grand scheme of gold things, all it takes is for more and more banks to join the bandwagon and demand delivery in kind from official repositories (i.e., New York and London), and the myth that is the overcollateralization of hard money by central banks will promptly come to an abrupt, bitter and, likely, quite violent end.

Who is next?

Source: ZeroHedge

Celtic Tiger Comeback My Arse

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Yesterday Irish Taoiseach(Prime Minister) Enda Kenny returned home empty-handed as yet again no bank debt agreement was reached during the EU summit. Many times since his party FG and their coalition parties Labour have come to power, they have promised to take on the bullies in Europe. Indeed Labours leader Eamon Gilmore came to power shouting “Labour’s way or Frankfurt’s way “. Embarrassingly for both parties it has been Frankfurt’s way.

 

The message from Merkel and Germany is clear. Thanks for bailing out German and French banks but its too late now for a deal, so just pay your debts.

 

Despite the Irish Government’s propaganda concerning the economy (including Enda Kenny appearing on front cover of TIME magazine), Eddie Hobbs (economists) writing in the Wall Street Journal summed it up best. 

Prime Minister Enda Kenny recently graced the cover of Time magazine. But according to data from the International Monetary Fund, Ireland has displaced Japan as the world’s most indebted economy. Government, household and nonfinancial company debt add up to 524% of Irish GDP. (The Central Bank of Ireland uses a different basis for calculating the debt of nonfinancial firms; its estimate for total debt would be lower than the IMF’s.) Funding this gargantuan load at an average cost of 4.5% would swallow nearly 24% of GDP—in other words, Ireland’s entire industrial output.

Yet still a Celtic comeback is prophesied. There are three huge problems with this myth:

• Irish taxpayers are still paying for the mistakes of Irish banks. Having started the crisis with a sovereign debt-to-GDP ratio approaching 20%, Ireland will have added another 100% before it’s over. And in a perverse reversal of democracy, two-thirds of this load was foisted on the Irish under pressure from the unelected board of the European Central Bank to save German, French and British banks—together with a panoply of other bank bondholders—from the consequences of their investment decisions.

Nowhere in the euro zone have so few citizens been asked to carry so much to save the union. But even today, with Ireland having met all the targets its creditors have set, there remains stiff resistance, especially from the ECB, to restructuring this part of Ireland’s national debt.

Relying on soft diplomacy, the Irish government seeks to sell its shareholdings in the functioning banks it saved to the new bailout fund, and to ease the punishing burden of repayments on the emergency liquidity provided to Anglo Irish Bank by extending the loan term to 40 years. The total plowed into banks is €64 billion, about 40% of Irish GDP.

• Irish household debt is still unsustainable. According to the IMF, household debt, which currently is as large as Ireland’s national debt, will stand at 185% of disposable income in 2017. The Irish are expected to arrive at this level from a peak of 210% by saving 14% of their income, nearly half of which would have to be redirected into debt repayments. So a decade after the crisis began, Irish household debt will arrive at a level well above the starting point of other crisis economies.

One in five Irish mortgages is in arrears. Yet four years into the crisis the Irish government has failed to introduce a modern, balanced and dignified insolvency regime, relying instead on a mishmash of laws, many of them Victorian and one of them, the Sheriffs Act, dating back to the 13th century.

Modern insolvency legislation would at the very least provide timelines to work through distressed debt. But such reform is being stiffly resisted behind the scenes by the banking lobby and the ECB. The result is a fiasco for Irish families, as the great game of “extend and pretend” continues. The urgent introduction of a standardized insolvency process matched to the scale of bad debts must also be supported by the European Stability Mechanism if fresh capital buffers are required.

Irish labor costs—especially in the public sector—are still too high. Since 1987, the Irish Parliament has callowly transferred wage-setting power to labor unions via the “social partnership” process. But a 2010 deal with public-sector unions, signed amid a brutal period of layoffs and pay cuts in the private sector, goes farther still by fixing pay and pensions for government workers at extraordinarily high levels through 2014. The agreement was named after Ireland’s largest secular temple: Croke Park, headquarters of the Gaelic Athletic Association, where the deal was struck.

Its effect, hardly sporting, is to privatize job losses from the recession and crowd out essential public services. In Greece, Portugal, Spain and Ireland, government employees already enjoy among the EU’s highest pay premia over workers in the private economy. But pay within the Irish public sector is also well above EU levels.

Pay for hospital consultants, teachers and nurses is singled out as especially high by the IMF. Local Irish county managers are paid more than most European prime ministers. Brendan Howlin, the minister in charge of reforming the public sector, is himself a former teacher and trade union activist. The inner cabinet of the Irish government—which comprises the prime minister, the deputy PM, the minister for finance and the minister for public reform—brings the intellectual firepower of three secondary-school teachers and a trade unionist to bear on Ireland’s crisis. All support the public-sector cartel.

The Irish government points to a reduction in public-sector numbers due to a recruitment freeze—as if those who take early retirement are abducted by aliens to a planet beyond the galaxy, and not into Ireland’s Ponzi pension scheme, which quadrupled its liabilities to €120 billion over the past decade while losing most of its assets to the bank bailout.

***

So while Time magazine and others eulogize the plucky leader of the Irish people, the truth is that Enda Kenny leads a Vichy government—captive externally to creditors that still insist on loading bank debt onto the sovereign, and internally to a tribe of insiders led by union godfathers in a deal that protects the government’s own excessive pay and pensions while bankers lean over its shoulders to rewrite insolvency laws.

This isn’t just crony capitalism. It’s crony democracy.

The funny thing is, in Ireland the Government and MSM have shut down any constructive debate on the economy. Certain economists and critics of the economic decisions of this and the previous government have almost been completely silenced.  As Eamon Gilmore says “put on the green jersey“, but isn’t the “patriotic card” always played when a Government is up to no good.

Source: Wall Street Journal

12 Year Old Girl Who Explained Banking System

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12 year old Victoria Grant being interviewed on RT regarding the video she made explaining the banking system.

The original video she made can be found at:

https://alternativeeconomics.wordpress.com/2012/04/11/12-year-old-explains-corrupt-canadian-banking-system/

Spain Is Printing Its Own Euros

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When the SHTF, central banks always resort to money printing. Thats all they know. Just before Ireland was forced into requested a bailout, the Irish Central Bank had to provide ELA to Irish banks to keep the system from collapsing. Reports from WSJ are that the Spanish Central Bank has had to resort to printing money ELA because of the dire situation in Spain. Meanwhile the bank jog/run continues.

As we described in detail yesterday, things are going from worse to worserer as the problems in Spain – more specifically in its banking sector – are deepening as deposit flight accelerates. As the WSJ notes PIMCOs’ comment: “A bank ‘jog’ is happening in Spain – the private sector is leaving the banking system.” But the Bank of Spain isn’t leaving anything to chance. The WSJ disconcertingly highlights that last month the central bank appears for the first time to have activated an emergency lending program that will enable its banks to borrow from the Bank of Spain directly, bypassing the ECB’s relatively tough collateral demands.

The so-called Emergency Liquidity Assistance program is shrouded in secrecy, and the Bank of Spain won’t confirm that it has been used. The Bank of Spain appears to have doled out about EUR400mm under the program, based on publicly available data. That would make Spain at least the fourth euro-zone country – following Greece, Ireland and Portugal – to use the ELA, which generally is reserved for situations when banks have exhausted all other financing options.

As we pointed out yesterday, this would appear to confirm a “full-blown bailout” is imminent, as the collateral problems mount.

 and The Bank of Spain was quick to respond to this reality (with a denial):

Bank of Spain comments in e-mailed statement on WSJ report that central bank provided ELA to lenders:

Sept. 5 (Bloomberg) — Bank of Spain says “liquidity provision to banks other than ordinary monetary policy operations represents an insignificant fraction of total lending by the Bank of Spain to financial system.”

Measures adopted to lift restrictions on interest rates on deposits is not aimed at helping banks attract deposits, central bank says

 

Source: ZeroHedge

Central Banks Leased Out Their Gold, But Will They Get It Back?

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This week there was a big move to the upside as many moved to cover their short positions. Interestingly Eric Sprott spoke to KingWorldNews of the Central Banks leasing out their gold to bullion banks. Presumably this has been for the purpose of suppressing gold prices to protect fiat currency. But they big question is when the SHTF, will they be able to get it back?

The central banks have been leasing their gold, as Sprott suggests.  But what happens when the central banks realize they are not going to get their gold back?  The people they leased it to are the bullion houses.  The bullion houses then sold it to somebody who wanted physical gold

The bullion houses, of course, were later going to buy the gold back from another source, and return the gold to the central banks.  But what happens when the time comes if there is not enough to go around to return the (gold) to the central banks

This is going to be an explosive move to the upside.  I just do not want to be out of the gold market at this time.” 

Commodity trade, Dan Norcini seems to think that we may be getting closer to that moment faster that you think as the last weeks trading in the gold market showed a lot of shorts were rushing to cover their positions.

“Both of these markets (gold & silver) broke significantly out of those ranges.  They did it on good volume, and they did it, surprisingly, when a lot of people really weren’t expecting them to do it.  This caught a lot of people napping with the intensity of the move, and the ferocity with which they broke out.

You had a lot of traders in the speculative community, and by that I mean the hedge funds, had taken out some pretty good size short positions in these markets.  These guys have been making bearish bets.  They’ve been adding shorts.

Those shorts got hit hard this week, and a lot of them ran for the exits, and the rest is history.  A lot of the momentum players are now in these markets.  That tells us that we should expect, as we move forward, to see dips in price begin to be bought because I think the (computer) algorithms are now in a ‘buy’ mode.

So these guys (shorts) got caught with their pants down, and that’s reflected in this week’s COT report.  Even though the COT only goes through Tuesday, we had some pretty big moves the rest of the week, so I expect we had significantly more short covering taking place this week than what’s on that report.

…..

You had a large amount of short covering in gold take place, and new longs come into that market as well.  Their net long position has jumped about 28,000 (contracts) in one week’s time.  That’s a big jump.

Norcini expects more speculators to come piling in which will cause further damage to anyone with a short position.

They (speculators) are coming back (into gold) with a vengeance.  They are coming back in at very low levels of exposure to the long side of the market.  There is a lot of room for these guys to come piling into the market.  There is potential for a very strong move upward as these funds begin to rebuild their positions on the long side.

If we clear $1,680, you’ll see some short covering above $1,680.  But you’ll see a significant amount of short covering, of a panic type nature, if gold goes through $1,700.  In other words if gold gets a ‘handle‘ of 17 in front of it, and gold refuses to break back down, the shorts are in trouble and they know it, and you are going to see them come out of there very quickly.”

Source: King World News

 

 

John Williams, ShadowStats: Hyperinflation is Coming

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Interview with John Williams from ShadowStats giving his opinion that Hyperinflation is coming by 2014. His gives a good sumation of where the US is right now and where he sees it going.

China To Be Major Gold Trade Center

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It should come as no surprise that China, the world’s largest gold producer and buyer should want to become a major gold trading center. The Wall Street Journal has reported such plans after being briefed by an insider.

China has proposed to broaden trading of precious metals in its local market in order to help China become a “major gold trading centre” (see News).

The Wall Street Journal was briefed about China’s plans by “a person involved with the matter.” The paper reports that “the move could increase liquidity and help Beijing gain stronger pricing power for key commodities like gold”.

China is the largest consumer and now the largest producer of gold in the world and has aspirations to become a major gold trading center on a par with London and New York. China is also the fifth largest holder of gold reserves in the world after the U.S., Germany, France, Italy (see table).

Clearly they have ambitions far beyond a major Gold trading center but as a worlds reserve currency, possibly even THE worlds reserve currency.

Chinese officials have spoken of China’s aspirations to have gold reserves as large as the U.S. in order to help position the yuan or renminbi as a global reserve currency. Indeed, it would be only natural for China to aspire to have their currency become the global reserve currency in the long term.

In the longer term, being a major gold trading center would make China a more powerful financial and economic player and indeed could allow them to influence commodity and other important market prices. Indeed, Reuters reported that becoming a major gold trading center “would boost the country’s clout in setting global prices”.

The journal reports that “Beijing’s tight grip on commodities trading and rigid capital controls are among the obstacles in the way.”

The move is also part of the broader financial reforms that Beijing has launched in recent weeks, loosening some of the restrictions on securities investment and allowing banks to price loans at cheaper rates than in the past, that seek to grant market forces a bigger role in both the economy and the capital market.

The moved proposed by market officials would expand trading of precious metals from designated exchanges to the country’s vast interbank market, according to the person involved. The Shanghai Gold Exchange has released draft rules for such interbank precious metals trading, which will include spot, forward and swap contracts for the commodities, said the person.

Current limitations.

At the moment, producers, consumers and investors can trade only spot and futures contracts in gold and silver on the Shanghai Gold Exchange and the Shanghai Futures Exchange, respectively.

Due to limited membership on the two exchanges, many investors, including banks, aren’t able to directly trade the precious metals on the exchanges.

The draft rules were jointly developed by the Shanghai Gold Exchange, which is the world’s biggest marketplace for spot gold trading, and the China Foreign Exchange Trading System, a central bank subsidiary that oversees onshore currency trading.

Plans are afoot to get around this and expand gold trading.

According to the draft rules, the authorities are aiming to launch the interbank trading on Aug. 31, starting with gold contracts, said the person.

That would make gold the first commodity to trade on the interbank market.

The authorities will introduce a “market maker” system for the planned precious metals trading—the first time the system will be used to trade a commodity on the interbank market—with transactions done on an over-the-counter basis as compared to the exchange-based pricing mechanism.

Market makers are firms that stand ready to buy and sell a product at a publicly quoted price to facilitate trade.

An over-the-counter market would allow investors, in this case banks, to trade in large quantities that far exceed the Shanghai Gold Exchange’s current trading volumes, analysts said.

According to the draft rules, banks are allowed to use the new precious metals contracts in the interbank market for proprietary trading only.

The Shanghai Gold Exchange is inviting banks, mostly members of the exchange, to submit applications to take part in the trading, said the person, who expects most major and midsize banks to participate.

The move to let banks become market makers also shows the authorities’ desire to give such better-established and more sophisticated institutions more power in setting prices for major commodities, a common practice in developed markets, said Jiang Shu, senior precious metals analyst at Industrial Bank Co.

Current restrictions and capital controls remain an obstacle to China becoming major gold trading center and to the renminbi becoming an accepted global reserve currency.

The move by China to expand precious metals trading to their glowingly important and vast interbank market is important and another step towards China becoming an economic power on the world stage and one that will rival European nations and the U.S.

Source: Goldcore

UK Customers Moving Accounts From The Big Banks

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Its enevitable that pissed off customers are going to move their accounts when you take into consideration the level of scandals and technical glitches that we have experienced in the UK over the last month. In fact the banking system takes for granted its customers loyalty, but thats a two way street and depends on the banks upholding their end of the bargain. Quite clearly they have been failing miserably to provide stability and honestly which is the cornerstone.

Angry bank customers have been voting with their wallets and bombarding co-ops, building societies and credit unions with applications for current accounts over the past week, after the NatWest computer meltdown and the Barclays rate-rigging scandal.

Data compiled by the campaign group Move Your Money UK shows an explosion in requests to switch from large high street banks to smaller alternatives that consumers hope will take a more ethical approach. Charity Bank, which lends its savers’ money to charities, has seen a 200% increase in depositors; the Ecology Bank has had a 266% jump in applications; and Triodos, a Bristol-based “sustainable bank”, a 51% increase.

Credit unions, which are often small institutions investing people’s savings in their local economy, have seen week-on-week increases of at least 20%, some of them up to 300%. Evidence of the growing number of switchovers comes as Ed Balls, the shadow chancellor, on Sunday calls on the government to make it easier for consumers to switch to another bank or building society.

Its not hard to see why customers are moving, but this has being going on from the start of the year and will most likely increase rather than decrease after the revelations over the past month.

Consumers have been looking for alternatives to the mainstream banks to protest about the revelation that Barclays traders conspired to fix a key interest rate over a number of years; and the IT chaos that left millions of RBS customers unable to access their accounts.

Since the start of this year, Move Your Money UK estimates that an average of 80,000 savers a month have been leaving the crisis-prone banking giants – a total of almost half a million since the start of 2012. The Co-operative Bank, which has seen a 25% rise in applications over the past week, hopes to capitalise on the public’s frustration by trebling its number of branches to 1,000, if it can clinch a deal to buy 632 from Lloyds Banking Group.

Lloyds, which was bailed out by the taxpayer during the financial crisis, was ordered by Brussels to sell the branches when it took over the troubled HBOS.

……..

Adam Scorer, director of external affairs at the advocacy group Consumer Focus, said: “Consumers have decided to mete out their punishment by moving away from banks who have been tarnished by recent events and revelations. RBS have failed on the basics of managing their customer accounts. Barclays have failed on the basics of behaving with honesty and integrity. These might be very different issues, but they both degrade the reputation of banks in the eyes of their customers.” Many British banks shifted from being “mutuals” – owned by their customers – to shareholder-owned public companies in the 1980s and 1990s, in a wave of “demutualisations”, seen as making them more successful. But as bankers’ pay has exploded, and profits flowed to shareholders rather than savers, a growing number of people have begun to warm to the idea of old-fashioned mutuals, including building societies.

Source: Guardian

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