Japan Carry Trade Is Inflating Many More Balloons
April 25, 2008
Elaine Meinel Supkis
The launching of yet another balloon economy is underway. Like the priest in Brazil who filled a thousand balloons with helium and then vanished into the skies and then fell into the Atlantic and drowned, so it is with our global economy: may a thousand balloons fill! These many mini-balloons are rapidly being filled this very day. But the results won't come in till later. Global markets are shooting up again thanks to the flood of funny money. The yen is getting weak rapidly thanks to the Bank of Japan utterly ignoring inflation at home. And the battle over the collapsing US manufacturing sector continues underground as well as in Europe. All nations that go for the balloon/funny money/cheap loans game are seeing erosion in wages.
Search suspended for balloon stunt priest
The Rev. Adelir Antonio de Carli has been missing since Sunday, when he lifted off from the port city of Paranagua strapped to 1,000 balloons. Denise Gallas, the treasurer of de Carli's parish, said Thursday that the priest's family chartered a twin-engine plane.The cleric's former flight teacher called his disappearance a "tragedy foretold."
Paragliding instructor Marcio Andre Lichtnow, who gave courses to de Carli three years ago, described him as a "headstrong, anxious individual who was always in a rush."
One could easily say, the global economy based on endless US bubbles of various sorts is also a 'tragedy foretold'. One can weary of talking about this. The deliberate inflation of global currencies pegged on a strong euro is now underway yet again, even worse than last year. WE had exactly half a year of contraction of the Funny Money™ supply. And far from being done, it is increasing. They will pump into world financial markets as much money as they can to inflate a thousand balloons in every possible country. This is what happens when bankers 'cooperate': they conspire to flood the world with red ink! And instead of accepting limits to the amount of red ink they may produce or else they create hyperinflation, they simply decided to collectively ignore real inflation.
This is why the demons of inflation are now squatting right on top of food and fuel. Gold is dropping, as I predicted. Stocks are rising because of Funny Money™. But the effects of this wealth will flow directly towards things people can't escape or do without. This is the nature of the beast! If we all want to evade the inflationary forces, we end up simply surrendering as they take over either taxes, food or fuel or in the present case, all three. Since this leads to violent social disorder, the bankers and rulers have to jigger things so this inflation isn't quite so obvious. But they can't inflate a thousand balloons without also inflating the dangerous balloons that lead to collective destruction!
This is the riddle they can't fix! They struggle to find some mechanism that will detour this effect. They first thought, if they simply pretended food and fuel inflation was meaningless, no one would notice inflation. But it is being hammered home into the brains of even the most math-challenged, inert heads of American consumers. The hidden debts we have accumulated are also beginning to be more apparent. For the last 30 years, the trade deficit has been increasingly ignored. When it started, there was wild panic. By over the years, this vanished into either despair or ignorance. Then, when the Japanese carry trade allowed infinite debts to accumulate, the trade deficit soared to unimaginable heights. While our rulers assured us that this was good, not totally evil.
For it killed inflation! They could merrily pump thousands of balloons and no one would be the wiser! It didn't even show up, for 7 years, in food and fuel. But slowly, it did. Now, the process is wide open and all inflationary forces are being expressed in food and fuel prices and this is destroying family incomes across the entire earth, not just in the USA. Nations with huge trade surpluses like China or Saudi Arabia have raging inflation, too.
How to stop China from stealing our jobs
By Howard Richman, Raymond Richman and Jesse RichmanOn April 18, China won another battle in its one-sided trade war against the United States when America's last remaining motorcycle maker, Harley-Davidson, announced plans to lay off 730 workers. These workers will join the approximately 2.3 million Americans who have already lost their good-paying manufacturing jobs to the Chinese strategy of selling to the United States without buying from us.
American workers have less money to spend on motorcycles because they have been losing good-paying jobs in the U.S. manufacturing sector and taking lower-paying and less productive jobs in the service and government sectors.
The Chinese motorcycle market is huge, about 24 million sold in 2007, up about 15 percent from the previous year. If China were willing to let their people buy Harley-Davidson motorcycles, then Harley-Davidson's exports could keep its workers employed. Harley-Davidson would be expanding its sales with China and the United States economy would be growing with the Chinese economy.
The Richman family and I have chatted on the phone in the past. I am glad their anti-free trade articles are being published. They are correct about taxes having a big effect on trade ratios. And they are beginning to agree with me that the carry trade has a HUGE effect, too. Any and all articles about global inflation that leaves out the dire effects of the Japanese carry trade are useless. Indeed, I must say that for the last 5 years, I have been one of the very, very few people who can see clearly how this works and why we are seeing greater, not less inflation right now and why it is global and not local.
Tax cut propels China stocks to biggest gain since late 2001
(Xinhua) -- The overnight announcement of a cut in share trading taxes drove Chinese stocks 9.29 percent higher in soaring turnover on Thursday, with the key Shanghai Composite Index up 304 points to 3,583.03, the largest gain since Oct. 23, 2001, when daily limits were introduced.The policy change, which slashed the stamp tax from 0.3 percent to 0.1 percent effective immediately, was announced two days after the benchmark index had fallen to half its peak of October 2007.
For the yen is now dropping against the dollar and the euro, dropping rapidly and doing this because the Japanese central bank is conspiring to do this to us. They decided to utterly ignore Japanese inflation and so the hole in the bucket, the gaping hole connecting all world currencies to the Outer Darkness is widening, not narrowing! When the yen rose in value, the world's banks addicted to this easy Funny Money™ suddenly had no liquidity. They spent trillions to regain it and it didn't work...until the yen began to weaken. Then, voila! Liquidity reappears! WHAT A SHOCK.
This liquidity is PURE POISON. But it boosts profits and values of everything and anything since it seeks to be attached to someone, anyone who will promise to pay some interest no matter how small. The tiny interest being paid to Japan balloons as it moves through various hands from the offshore pirates to US Treasuries into Wall Street, etc, this .5% interest creates trillions in lending and this is protected by the Derivatives Beast. Who is now growing massively again.
Foreigners 'cut inflation and avert skills shortage'
The Work Foundation rejects assertions that foreign workers have taken jobs from Britons and forced down wages. Its report, released today, argues that the influx has in fact helped to reduce inflation and interest rates and enabled the country to avert damaging skills shortages.Britain has been kept on a "stable growth path" thanks to immigration, the foundation says, with newcomers boosting the economy by 1 per cent in 12 months after the European Union expanded in 2004.
The conclusions contradict the recent analysis of the Lords Economic Affairs Committee, which said competition from immigrants had a damaging impact on the low paid and on training for British workers.
The think-tank argued that the rising national minimum wage had established a "strong pay floor", which was protecting workers from exploitation.
This article is an example of 'free trade' goons: immigrants flooding into the dying empires are NOT dropping wages, they are KILLING INFLATION. HAHAHA. Anyone who buys this is insane. And many news paper owners are harping on this! They love it. The New York Times, one of the biggest 'Free Trade Flat Earthers' is now firing a huge number of reporters and editors because they are not making enough money! Amazing. And I bet these people will be replaced just like the financial papers have fired Americans and Brits and hired Indians and Chinese to do business reports. Writing daily stories is easy. Analyzing things is hard. But since the WSJ, WP and NYT all are pro-free trade and pro-Japanese carry trade, this leaves absolutely no room for any sincere realistic analysis.
Report alleges abuse in Asia shrimp industry
Workers in Southeast Asia's shrimp industry suffer regular abuse and sometimes live in what amounts to virtual slavery, a human-rights organization said Wednesday.Sexual and physical abuse, debt bondage, child labor and unsafe working conditions are common in Thailand and Bangladesh's shrimp processing factories, the Solidarity Center said in a 40-page report.
And much of our 'cheap foreign labor' is more akin to slave labor. Germany has the world's biggest export trade profits on earth. They have a strong currency, high interest rates, unions, taxes and socialism. The nations that have less and less of these things have less economic power. Japan still has these things that Germany has but has dropped the 'good pay' part and now is withering on the vine and can keep alive only by utterly lying about economic matters and flooding the planet with easy lending. Germany is not doing this. China is imitating Germany, heading away from the cheap, slave labor and weak currency. Their currency has been strengthening against the dollar and they are bitterly angry about Japan and the US conspiring with the G7 partners to play the weak currency/Japan carry trade game. But they are switching gears yet again. They are probably going to try to isolate China from this flood of Funny Money™. This means world trade will shift yet again and the US won't like it. Already, the price of Chinese goods is rising rapidly here in the US. This means our bosses will have to talk about inflation and raise interest rates or the dollar dies even worse against the German currency, the euro.
Comptroller of the Currency
Administrator of National BanksComptroller of the Currency John C. Dugan said today that, with problem loans rising, it’s imperative that bank management identify and address problems realistically and that the OCC deal with national banks in a consistent and balanced way.
The OCC has spent a good deal of time evaluating what went wrong during the late 1980s and early 1990s, and the lessons learned from that period – including a recognition of mistakes made by the OCC – will help the agency deal with problems in the current environment, Mr. Dugan said in a speech to the Exchequer Club.
In the last real estate downturn, he said, OCC examiners tended to make unilateral adjustments to real estate appraisals that had become outdated due to clear changes in the markets. Today, he said, the OCC’s preference is to direct management to obtain a new appraisal, and then give the bank a reasonable amount of time to review that appraisal and use it to make decisions about how to classify loans.
The Comptroller also noted that the OCC did not give enough credit in the last downturn to bank management that was dealing realistically with problems.
“When we see that bank management is realistically recognizing losses and taking tough steps to deal with problems, we are going to give the bank more latitude than we will when we find a management team in denial that forces us to do their work for them,” the Comptroller said.
The poor OCC struggles with few tools to contain the messes created by the many thousands of balloons inflated by the central bankers. But they will fail simply because the desire to pour endless helium into infinite balloons has overwhelmed our central banks. They consider it a victory if they succeed in flooding this planet with money. This is why I hammer on this topic so much: NO ONE in power is LEARNING ANYTHING AT ALL! The profound gulf between reality and their stupid desires for easy money yawns even greater now, not less. Now on to a good editorial about all this from International Forecaster:
Manipulations in time of War and Hunger
By Bob Chapman:The GSA had been in effect since 1933 and was passed due to abuses, which were found to be a substantial contributing factor to the Great Depression. This wise piece of legislation had kept us out of trouble for over six decades. Both Executive Order 12631 and the GLBA will go down in history as the most ill-advised and most abused financial orders, laws and regulations ever devised, perhaps in the history of our country. The Executive Order currently gives the PPT the right to enter any markets to create stability in the face of a crisis, but instead they use this power on a 24/7 basis to hide from the public all the damage that has been intentionally or unintentionally done to our economy by various Illuminist schemes, including the abuse of the GLBA which allowed banks to pawn off fraudulently rated toxic waste, which quite often the banks themselves or their subsidiaries had created, on their clients and to hold it for those clients in offshore accounts called SIV's.
*snip*
These moronic acts by former Presidents and Congresses are what allowed the psychopathic creation of hundreds of trillions in derivatives by way of "financial engineering" in order to absorb the rampant money being supplied by the Fed to fuel financial sector profits in order to cover up the damage being done to the economy by free trade, globalization, off-shoring, outsourcing and illegal immigration. The money was pumped in through the primary dealers via the repo pool and was loaned out to other foreign and domestic banks and to client dupes like hedge funds, insurance companies, pension funds and other institutional investors in order to purchase the toxic waste, often with maniacal degrees of leverage. The sales proceeds were then re-loaned to the mortgage companies so they could fund more fraudulent mortgages which could then be securitized into more toxic waste for resale, thus rolling the money over and over, with the Fed's periodic money injections allowing them to expand the amount of loan money available overall to keep the bubble going. All caution was thrown to the wind to bring in even the unqualified so that the fees and commissions would keep rolling in.
His entire article is a good read. I am relieved to see someone agrees with me! He, like myself, struggles to figure out all the tricks, games, cons and schemes going on so we can chart a sane course. Old Ron Paul hopes to find an easy solution, namely, return to the gold standard. But I fear this is now virtually impossible except if we have a global government. Perhaps the Chinese will force this down on us? They are increasingly the ones who probably could do it. The US is much too deep in debt, like England and Japan, to do this. It would bring down total economic chaos due to systems with way too much debt suddenly stuck with trying to pay for this with money that has limits.
The Plunge Protection Team which Bob refers to is supposedly mythical yet all of us suspicious people who watch things closely can see clearly that it exists and it is run out of the White House and is in cahoots with Wall Street's top 5 financial houses. We saw it in naked panic when it rammed through the Bears Stearns deal. A deal that has launched a thousand lawsuit balloons. Heh. And in 10 years we might learn all the ugly details the principal criminal con men are studiously hiding from us today.
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