globalised cash flows are good

@sarc

well, check this flow of consciousness:

I'm building a new, overarching theory of why global flows of cash and credit are not working.
The basis of this is
"what happens when one country is hit with a crisis".
Big up to Reggie Middleton for that
[for audio-visual learners]

the key points:

The gambling, broke banks are borrowing money from broke governments
because governments can print new money. (U.S., U.K.)
That money goes to keep a shackled country from getting a haircut, and being free.
So that bankers can keep making profits and suffer no losses.
If one country declares official insolvency, then they'll all fall.

The long and short of it:

Money can go wherever it wants.

Credit can be printed by governments- money printing

Big cash holders can stash their money in tax-free tax havens.

The system maximises its potential by going wherever the big money is.

Everything, except for sh*t guano, has been spun into a derivative investment:
the big money is in gambling investments that are unregulated:

derivates, CDOs, CDSs, hedges (e.g. on whether country X will default)
The genius of this is that debts were spun into the above assets,
that were fraudulently sold and
fraudulently assessed as AAA by Fitch, Moody's, etc.
Stockbrokers only care that they get fees and bonuses.
And when this crap implodes, it goes nuclear.

If a country suffers a crisis- Japan's tsunami, Greece's IMF bailout,

the system is stretched to its limits

Banks from one country lend to other countries.

With the bank crisis, countries covered the losses of their banks

and asked their taxpayers to pay for it all.

before the crisis, EVERY country was running a deficit and borrowing from banks and
other countries. The only difference now is that

most liquidity disappeared in 2008 (I don't know why yet)
I MEAN, PHYSICALLY, "WHERE DID IT GO?"
My opinion:
the missing liquidity has been hidden in
an alternate universe by the banksters.
I mean, the police have dug up the back yard at HSBC,
and they can't find a thing!

So, now it's more fun and profitable for the
BIG BOYS (US, UK, EU)
to destroy small (TOO SMALL TO LIVE) countries and
enslaving them to the IMF (Greece, Ireland, Portugal)
than sorting out the cause of the problem.
YES, The EU is SACRIFICING SOME of its OWN CHILDREN

All this money trading is maximised.

There's no such thing as deposit insurance in the true sense.
There's no money under the EU's mattress, in Brussels.

All banks are leveraged 30 or 40 times their deposits.
Fractional reserve banking, or FRACKING.
the government (i.e. taxpayers) provides the insurance, unless it's broke.
the Basel agreement didn't help. Banks would ignore it anyway

if a bank or country fails, other countries' taxpayers will pick up the bill
e.g. Euro group of 15, sorry, 14, sorry 13
as you can see, we're playing 'ten little Indians'
And then there were 12.....

so, countries are overly indebted,
and rely on banks that are over-leveraged.
in other words, they're all circle jerks.

[when the sh*t hits the fan-circle jerks cause that]
Seriously, though, I just heard that government lending is
the lending of last resort
when a private credit market has
"done the raisin" and shrivelled.

Get a haircut and a real job

If one country goes for a haircut, say Greece,
it will knock other countries & their banks into insolvency.
(see Reggie Middleton's talk above)

He calls it the DOMINO EFFECT, for obvious reasons

So, haircuts will only happen when there's a bigger danger to avoid.

Many countries and many of the largest 20 world banks are already insolvent

BROKE!
hiding their derivative losses off the balance sheet (naughty!)
LIVING ON LIFE SUPPORT from other banks and countries, like China

So, the only way for the world to continue is for countries to keep printing money.

Money is now just a blip on a screen. Nobody knows how much anybody really
has in his kitty, until the bank/country becomes insolvent.

Greece still doesn't know how much it owes.
Nobody wants to admit that the big scam today
is designed to plug the
$20? trillion black hole
made by illogical derivatives,
in a loony market, because nobody knows how
to pick up the pieces when the derivs ALL go toxic.
So, banks slowly divulge their derivative debts
when they come due, and the government,
i.e. UK and US
QUIETLY give them more free money to plug
that gap. Whether they need that money or not.
Why not just wipe those derivatives off EVERYBODY's books?
Nobody really treats them as assets, anymore.
No bank is every going to say to another bank
"remember that goat-shit derivative you sold me?"
"well, you owe me 5 billion bucks"
Nobody understands these unregulated agreements,
even the guys who sold them.
They just fall to pieces. like something from a fairy tale,
wherein the Witches of Wall street win.
The money? In that alternate universe thing. Paging Doctor Who.

This insistence on treating this

hidden, fake(?) problem as if it were real
causes big banks and their 'protector' governments to work together.
Back-scratch fever. Partners in crime. Fascism
Banks need the "right" environment in which to operate.

These banks, particularly in the UK, US, Germany, Switzerland

are TOO BIG TO FAIL - TBTF

This causes these oligarchies to break laws because these banks

e.g. Goldman Sachs, JP Morgan, HSBC, UBS, HBOS

must not be allowed to fail, because they will

drag down those countries, and others with them.

The EURO, as any currency, depends on confidence. See what happens when

one country, sorry, two, sorry, three countries

keep knocking the confidence in a currency?
These credit problems become trade problems because everybody needs

good trade numbers to keep this charade going.
They can't afford to lose millions of workers, overnight.
The people might wake up.
so, within reason, it is in the interest of a country
i.e. the US & Germany
to 'destroy' their currency value
in order to increase trade.
Hence all the rumours about Greece defaulting.
Greeks panic because they don't realise it's all a game.

The banks are so busy gambling that they have no time

to lend to businesses.
There's no money in it.
When you get a government-guaranteed gambling racket,
why lend to Mrs Smeddley who wants to borrow
£2 000 to buy a used Nissan?
Or to a company that wants to expand its factory?
Why even insure a car or house owner, when
you're swingin' while you're winnin'
on the stockmarket?

That means business is hampered, and employees are fired/sacked.

Nobody dares ask for a raise.

Saving is now stupid, because interest is 1%, and

inflation is somewhere

between 5 and 10%.
Don't believe the official figures

Do your own research
at the supermarket, the fuel pump, your bills.

Savings are necessary for real economies to grow. People have money.
They put some aside for later in a bank.
Banks use the money to support businesses through loans.
This is now slowing down to 0% in many countries, like the UK.
Their savings are an illusion. Most of the money's in the 'casino'.
If everybody asked for their savings today,
the banks would seize up, close their doors and file for bankruptcy tomorrow.

The prols' humble stockmarket investments are largely gone,
despite the stock market bubble this year.
Their state pension deductions were eaten by their governments,
and so they'll get a meagre pension,
as the number amount stays the same,
and loses 5-10% of its value every year. An illusion.
The post-war boom. An illusion.
Those who have already died might have lived well.

For governments to have money, they need taxes,
but rich people don't pay taxes
corporations don't pay.
They offshore their money.
You buy stuff at one of their stores, and
after they pay staff (meagre wages) and expenses
the profits go bye-bye.
Your paycheck money ends up in the Caymans,
and we're left with a government
that can't pay for proper schools or hospitals or pensions.
Welcome to the Banana Republic of the United Kingdom,

and remember,
we're now paying for the bankers' debts,
on top of our own public services.

shrinking economic activity

and yet big profits are exported.
we're screwed!

You see, the rich are bending the laws of physics.
They say "well, I may be here doing business,
and making a killing,
but you can't touch me, taxman" [adopt mafia voice]
"I'm really in Switzerland, and you're just talking
to my dermal avatar"
Philip Green is just one such avatar. All epidermis.
[as Rich Hall once said, "looks like 10 lbs of sh*t in a five-lb bag"]
His company Arcadia "belongs to his wife", she of Monaco (I'd like to see the divorce on that one), so he snuck away with £1.2 billion in corporation profits. The UK is out £250 million in tax.

For governments to care for their country, they need control of
natural resources (oil, energy supply, water, etc.) which have all been given
to big corporations that export their profits.
They need to regulate the financial and other markets and keep
monopolists from profligate profits and law-breaking.

THAT'S NOW HISTORY.
US- SEC, UK- BANK of ENGLAND, FSA, back to BoE.
In Switzerland, bank whistleblowers are hunted and caged by the government.
In Luxemberk and Jersey as well.

A lack of loans and a lack of confidence, and a lack of job growth
means that housing prices (a huge bubble) have deflated.

Most governments are lying about the true level of the problem,
to avoid panicking the people, as is true in the UK.

Indeed the future of our carbon-based economy is reaching a breaking point.
We need lots of money to invest in alternative energy, or in finding
expensive oil reserves, but

THERE'S NO MONEY TO GO AROUND. NO LOANS, NO INSURANCE.
only the OPEC countries have the potential
to find the money to do this, but that won't help
the 'advanced' Western economies
that are consumers of the product.
[now you know why the US is invading oil-rich countries]

So, the global arbitrage man is operating on margins,
and doesn't know how much he owes.
He just knows that the lights on the screen keep going.
So, everything is just fine.

Meanwhile, outside the castle walls of Wall St. people are losing confidence
in everything as their illusion of 'the GOOD LIFE' comes crashing down.

There is no possibility of a happy ending when nobody knows how to unravel
the ill gambling that's been going on. Every western country is involved in
interlocking debt with every other western country.

The tendency is for bank-governments to kill countries & their banks
& then save them with usurious IMF loans,
because they don't know what else to do.
It's the old "you owe me" type of enslavement.
and stockbrokers are salivating at the possibility.

They get FEES for the paperwork.

Their role in this kabuki theatre is that their short-term market decisions

get them FEES & BONUSES,
whether their move makes money
or destroys the whole world.

until

TOO BIG TO FAIL BECOMES
TOO BIG TO SAVE
Nobody knows when the tipping point will come.
but, it's guaranteed to be a tsunami.
Right now, I think there are countries that recognise
that there is nothing, within the laws of physics,
that they can do to save their countries.
Even when money is a blip on a screen.
So, they do what all politicians do; they lie to their people.
I believe that Italy and Spain are being helped behind closed doors
because their 'failure' would be too hard for
the EU to paper-over.

The IMF is given the task to sort out problems
but, the IMF is the group that enslaved most of
Latin America from the 70s onward
you know: "sell off your utilities to rapacious capitalists"
"tax the poor"
"it'll be good for you"-
that's their logic- hair of the dog that big 'em.
Greece is at the beginning stage of this, right now.

so, we'll soon get:
1 a bigger financial crisis than 2008, followed by
2 chaos and anarchy, when a large enough group of citizens
see nothing but debt, cuts hyperinflation & oppression
they'll says "enough is enough"

[WITNESS WHAT OUR FUTURE HOLDS- don't cry for me, Argentina]

[you don't need to know Spanish to see what's happened. The reporter asks
normal, educated people, who are raiding stores and stealing,
and they say something like "I have 3 kids and no work for years"]

store raids, marches, harrassing politicians, occupying parliament

bye-bye Presidente.

We have the example throughout Latin America.
We have the example of the Asian crisis of the 90s.
We watched with bemusement or indifference.
Well, those were training grounds (see Naomi Klein)
for catching some big game fish. Western Countries!
Chills go down my spine.

The WHOLE system we have says, "greed".
This is a Ponzi scheme that needs growth
to pay off its debts. No growth, no pilfering.

it all started long ago, with

companies that benefit from pay arbitrage

and take jobs to China.

When $1 million is not enough profit for shareholders,

so bosses fire workers.

Short-termism is now taken to its limits.

Fees today; screw tomorrow. There is no "tomorrow" (just as the song says)

The illusion of "a BETTER FUTURE THROUGH GREED" is gone.

We'll eventually get a global currency
(so that nobody will know how bad the economy is)

but the World Bank and IMF will apportion money to their friends.
and the worst thing is, it's all an illusion.
It could stop tomorrow.
It's only little pieces of paper and blips on a screen.
Silver and gold are real!

Or, we can go back to the Iron Age
a hovel (no mortgage), a garden, two chickens, some utensils, and no cash.
If we're willing to do that,
then fractional banking is dead.

I'm glad I got that off my chest.

-Costick67 ~(8^P

[for a good starter. It's got Argentina, Milton Friedman, deregulation, etc.]