Debt and The Death Of The Petrodollar

Geopolitical Moves Obliterate U.S Petrodollar Hegemony?

Submitted by Mac Slavo via,
It seems the end really is nigh for the U.S. dollar>
And the mudfight for global dominance and currency war couldn’t be more ugly or dramatic.
The Saudis are now openly threatening to take down the U.S. economy in the ongoing fallout over collapsing oil prices and tense geopolitical events involving the 9/11 cover-up. The New York Times reports:
Saudi Arabia has told the Obama administration and members of Congress that it will sell off hundreds of billions of dollars’ worth of American assets held by the kingdom if Congress passes a bill that would allow the Saudi government to be held responsible in American courts for any role in the Sept. 11, 2001, attacks.
China has been working for years to establish global currency status, and will strengthen the yuan by backing it with gold in moves clearly designed to cripple the role of the dollar. Zero Hedge reports:
China’s shift to an official local-currency-based gold fixing is “the culmination of a two-year plan to move away from a US-centric monetary system,” according to Bocom strategist Hao Hong. In an insightfully honest Bloomberg TV interview, Hong admits that “by trading physical gold in renminbi, China is slowly chipping away at the dominance of US dollars.”
Putin also waits in the shadows, making similar moves and creating alliances to out-balance the United States with a growing Asian economy on the global stage.

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United States Of Insolvency

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Putin Targets US Monetary System: "Aims To Eliminate US Dollar From Trade

De-dollarization is escalating all around the world. With Yuan/Rouble trading volumes up a stunning 400% year-over-year to record highs, and hot on the heels of China's (and much of EM Asia) dumping dollar assets, Russian President Vladimir Putin has just unleashed a new bill aiming to completely eliminate the US dollar from the trade of goods.

As Putin explained last year... trade in Roubles and Yuan will weaken the dollar's influence.

As's Mac Slavo reports, last year Russia began unloading massive amounts of their US dollar reserves. In the month of December 2014 alone Putin sold some 20% of the country’s U.S. Treasurys, a move that further increased tensions surrounding what can only be described as economic warfare between East and West.

Then, as if part of a coordinated effort, this summer it was revealed that China had implemented a similar strategy, dumping half a trillion in dollar denominated assets.

But that’s just the beginning of the end for the US dollar. Amid a major meltdown in Chinese stock markets the People’s Republic sold off billions in dollar assets last week in what was reported to be an effort to stabilize their collapsing financial markets.

And now, as Russia’s economy collapses under the weight of American and European sanctions, including what many believe to be widespread downward manipulation of oil prices, Vladimir Putin is sending a clear signal to the central bank of the world’s reserve currency.

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Get Ready For The Collapse Of The Global Economy

In the years we have been publishing, Daily Stirrer financial correspondent Phil T Looker has consistently predicted the refusal of the market rigging banksters to acknowledge that the developed worlds debt driven economy was FUBAR might delay the economic catastrophe but that would only make the final collapse worse when it eventually happened. Here's another Texas sized helping of financial insight and economic wisdom form former bank business and commercial account manager, now an independent financial management consultant Phil, who is also a regular contributor to The Daily Stirrer
Get Ready For The Collapse Of The Global Economy

The housing association that will no longer build homes for the poor

The Guardian via RSS feed

One of the largest housing associations in the UK last week announced it would no longer build social housing. Instead, its chief executive said, it will only build homes for sale, for rent at full market rates or for shared ownership.

Furthermore, Genesis housing association, which owns and manages about 33,000 homes around London and the south-east, will consider selling or raising the rents on its existing social homes once they become vacant.

The organisation claims that government policies have forced its hand, particularly in light of the recent budget. This is strange when you consider that Genesis has funded much of the research that has influenced this government’s housing policy. To blame the government after you have sponsored thinktanks to successfully influence it is no excuse. In reality, it is part of a deliberate, profit-driven strategy that Genesis and other large housing associations have been following for some time.

The chief executive of Genesis ?reportedly said housing low-income families 'won’t be my problem'

There is no doubt that housing associations are operating in a difficult environment: government funding to build social homes was cut by 60% in 2010 and the impacts of welfare reforms have heavily affected their tenants (and consequently their rental income).

For some time many housing associations have argued that they will diversify into other markets (such as building homes for sale or shared ownership) to ensure that they can still deliver their core social purpose and values. This has meant many associations have become more commercial in their approach so as to create profits to invest in low-rent homes that poor and low-income people can afford.

Read full news report at The Guardian

It seems to us that as with the care sector, humanitarian aid
charities and so on, charity bosses are turning their organisations into commercial enterprises whose ventures are underwritten by we the taxpayers

Financial Fraud: Market Rigging By Any Other Name

Over the past twenty years we have hasd many financial scandals, the dotcom bubble, misselling of investments, toxic debt, derivatives trading, maket rigging and interest rate rigging. And, because I know the Church of Scienceology cult and the Tech worshippers love me so much I'll mention that all these have been made possible by the adoption of digital technologies that to my experienced eye (I was in the computer business for thirty years, several of them spent working for banks and investment houses) a lot of the software used by these trading systems was developed with the intent of facilitating fraud.

The latest scandal which is now breaking but will not be mentioned by mainstream media involves HFT, high frequency trading, the practice of using computers to buy and sell stocks and derivatives every few seconds.

Contrary to what the Tech Heads and Sciencologists will tell you (I remember one wanker writing in The Daily Telegraph that we must cede control of our lives to machines because the algorithm will always make better decisions than the human mind) the machine will always do what its human masters have programmed it to, so if it is programmed to commit fraud it will always commit fraud.

Frontrunning (sometimes known as pump and dump) is the practice of rigging HFT machines to buy certain investments on eastern stock exchanges ahead of markets opening, thus the statistics fed to European or American makets show a leap in prices. The HFT algorithms are programmed to follow the trend and so buy, while those traders who have forestalled the market are selling.

After a while the HFT systems' algorithms notice who is selling and stop buying, the program having predicted a price drop is imminent but by them it is too late. The profit margin on transactions is often half of one per cent or less, but a half per cent of a couple of billion is a nice days wages.

One of the biggest players in this High frequency Trading scam is a hedge fund named ARQ.

Last year, following Michael Lewis' of exposing High Frequency Trading for being nothing more than a sophisticated gimmick enabling market rigging and bulk order frontrunning while pretending to "provide liquidity", the revulsion against HFTs hit a fever pitch.

Several months later, because the market kept going higher, people quickly forgot why they had been so angry at a bunch of computer chips.

However, since the market is once again on the verge of a crisis (see China for details), the authorities who are supposed to regulate traders need to cover their arses. Thus hedge fund ITG, owner of the Posit dark pool, was busted with a $22.6 million penalty for what appears to have been blatant frontrunning of its own clients. The scam seems to be centred on the activities of one manager, Hitesh Mittal.

from via Zero Hedge

Hitesh is the head of AQR's Global Trading Strategies group, running the firm's trading desk and overseeing the group that builds automated trading models and does transaction cost analysis for equities, futures and FX globally. Prior to AQR, he was the global head of liquidity management at Investment Technology Group, where he built its algorithmic trading platform and managed its crossing network, POSIT. He has published several papers on market structure, algorithmic trading, dark pools and transaction cost analysis, and is listed as a co-inventor on three patents. Hitesh earned a B.Eng. in computer science and engineering from JNV University in Jodhpur, India, and an M.B.A. from New York University.

As ITG CEO Bob Gasser noted, "The problematic behavior was led by a senior employee who operated in a manner that violated ITG policy, Gasser said Thursday, without identifying the former worker."

In short, the "former employee" was frontrunning external orders in ITG's own trading dark pool/HFT pod.

Previously, ITG Chief Executive Officer Bob Gasser made several references to a former employee he didn’t identify who was purportedly involved in the case that led to Michaell Lewis' exposá. While apologizing during a conference call with maket analysts, the CEO highlighted the actions of the former employee, who Gasser said was “ultimately severed from the company.”

That former employee is the same Hitesh Mittal as is mentioned above: it turns out he quietly quit ITG by July in when a Traders Magazine article reported then was a "cost-cutting measure." It now appears that he had merely been busted for engaging in what the regulator now confirms was illegal activity.

But it's not what he did there that is notable. It's where he went after - the place: the world's 4th biggest hedge fund, AQR Capital with $136 billion in AUM, run by the outspoken Cliff Asness, who just happens to be one of the biggest supporters of HFT there is.

Plus ça change, plus c'est le meme chose, as they say (or in English, the people who control the machines control the world.)


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Debt Crisis
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Riots In Athens As Betrayed Greeks Take Back Democracy

Betrayed by the legacy parties of conservatism and socialism that led them into the Eurozone by fraudulently cooking the books to give an impression that Europe's basket case economy met impossible conditions required for entry, betrayed again by the left wing radicals elected on a promise that they would accept no more austerity, the Greek people are trying to shape their own history. They aren’t there yet but a coalescence of forces is on the horizon: either a breakaway group from Syriza (probably led by Yannis Varoufakis) will bring down the government of the sellout Tsipras the be left behind.

Ideological labels are not important; the EU is a corporatist, expansionist, fascist dictatorship, what Greece (and every other EU member state) needs, is a genuine people’s government. The riots in the streets of Athens, as the Greek Parliament passed the austerity measures the EU imposed just for the sake of shafting the greeks up the arse to show democracy means nothing in the european Union bureaucratic dictatorship, may be the first sign of the breakup of the EU.

Shrinkage might be a better description of what is likely to happen, greater transparency, more accountability and the end of the neo - Nazi dream of 'ever-closer union' (aka the creation of a single European superstate), the last signifying EU’s role as prototype for Washington-defined globalization and world government.

The typically Nazi or Fascist mix of market fundamentalism and social militarism needed to pull off the creation of a global empire would be difficult to hide. The failure to create a German-led economic monolith for achieving an intra-Europe division of labor, nations rich (North) and poor (South), while providing political cover for NATO in its continued prosecution of the Cold War against Russia and SETO against China. Austerity is repression, pure and simple. It is also, as I recently pointed out, the framework for class warfare, in both cases to the extreme detriment of working people.

The people in the Athens street know this, know that Tsipras and Syriza have not done right by them. The public workers’ union went out on strike Wednesday. Crowds gathered before Parliament in the evening. Tsakalotos, the new finance minister, was shaken, reluctant to approve the bailout, in microcosm, representing the many, in and out of the party, who saw the mounting pressures and if not succumbed then made a forced choice.

This was not the affirmation one expects from a basic settlement, and rather, a period of deliberation, of gathering force that, should the EU turn the screws further, might well explode, not as revolution, but a willingness to say No and from there leave the eurozone and the EU itself. Why would Germany and the other stalwarts, Finland, the Netherlands, and the Baltic countries care? For the reason that Greece is a living refutation of all the stalwarts value: balanced budgets, taxation favoring business growth, gradual diminishment of labor rights, erosion of pension and social-welfare programs, etc. By bringing Greece to its knees validates austerity: there is no other way than this, the best of all possible worlds. Capitalism, both in Europe and America (indeed everywhere), thrives on false consciousness lest its destructiveness becomes apparent. Hence, it must thwart Left social movements; antecedently, it must deny the idea of alternatives, that which shows a better way to social justice, peace, a humane life.


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Financial Coup in Greece

Source: Le Monde Diplomatique

From day to day mainstean and alternative media commentators speculate about when Greece will finally admit is is bankrupt and will have to leave the European Single Currency system, abandon the Euro and return to the Drachman, and the Euronazis of brussels admite they were wrong to bend the rules in order to get Greece to adopt the Euro, and stop piling more agony on the long suffering Greek people and help organize a painless exit.

From France Le Monde Diplomatique reports that four months after Syriza’s victory in the Greek election, with the traditional parties of government since the fall of the military junta, the Panhellenic Socialist Movement (Pasok) and New Democracy (rightwing) have been completely destroyed. The first radical leftist government since the “mountain government” at the time of the German occupation is still very popular despite its struggles to resist EU presuure for more austerity.

Although the "troika", (the IMF, ECB and EU commission) hated because of the harsh economic measures imposed as a price for the bailout and thus to blame for the squbsequent economic disaster, is no longer mentioned, its three parts — the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) — continue to squeeze Greece by imposing the same austerity on the government of Alexis Tsipras.

With GDP down by 25% since 2010 and an unemployment rate of 27% (over 50% among the under 25s), Greece has a social and humanitarian crisis on its hands. But despite the results of the January elections, which gave Tsipras a clear mandate to end austerity, the European Union continues to treat Greece as a naughty child who must be punished for its irresponsible behaviour and to discourage voters in Spain and elsewhere who still believe in the possibility of governments opposed to German domination (that point of view does not bode well for an EU future of ever closer union with France and Germany as the main political and economic powers).

This situation is like Chile in the 1970s, when US president Richard Nixon was determined to topple Salvador Allende to prevent leftwing contagion in America’s backyard. “Make the economy scream,” said Nixon, and when it did, General Augusto Pinochet took over.

A similar, externally orchestrated coup is under way in Greece, using more modern economic tools including manipulating bond markets. Two options remain for Tsipras’s government: to be strangled financially if it keeps trying to implement its programme, or to renege on its promises and fall, abandoned by its voters.


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Europe is coming unglued

Greece - the final solution

Europe bracing itself for the Grexit

European democracy does not extend to Greece

What's the point of the EU imposing economic sanctions on Greece
Brussels Euronazis Message to the New Greek Government: We Don't Care About Humanitarian Issues

We've Come To The End Of The Road Says Greece

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