Money Matters: IMF Praises Imperial Money Creation By US and Europe

Elaine Meinel Supkis

The IMF protects the European and American empire as these entities violate all sorts of IMF rules. Indeed, instead of being forced to use FOREX reserves which the US barely has, both the Bank of Europe and the Federal Reserve were allowed to talk about INFINITE money creation and how they could make merry money forever without any limits! Ever! Why isn't the IMF condemning this and demanding an accounting for the half a trillion + poured into the banking system without a penny or euro coming out of any FOREX reserves? Indeed.

Economic Growth and Financial Market Development: A Strengthening Integration
Speech by Rodrigo de Rato, head of the IMF:

3. This episode of turbulence represents the first real test of structured finance and related credit derivative markets, and of the complex instruments being traded in these markets. It should be said at the outset that these markets, which have grown rapidly in recent years, have brought many benefits. By enabling market participants to better diversify risk, the cost of credit has been lowered world-wide, and a much larger segment of the population has been able to access credit, providing an important boost to global growth.

4. However, some participants have under-estimated the risks related to both the liquidity and the pricing of these complex instruments. Deepening concern about the situation of a number of financial institutions exposed to these risks has had a significant impact on the liquidity of the interbank markets. Fortunately, a number of central banks throughout the world have been quick to react with significant injections of liquidity, with an aim to restoring orderly market conditions. Nevertheless, looking forward, there remains considerable uncertainty about the implications of the ongoing liquidity squeeze for financial markets and for the outlook for the real economy more broadly.

The International Monetary Fund is run by the satellite nations of the UK/USA empire which has ruled the planet for 200 years, first one then the other. The rival European empires that fought this huge empire have surrendered in the last 60 years and are now content to puff of this empire because they imagine they will still be able to stride the earth as rulers even if they are carrying the ermine train of the Emperor.

Only, as per usual with all dying empires, we chose to be led by a monkey king who is naked, to boot. This pure lunatic has caused our empire to do the stupidest imaginable things and all the dead empires in Europe which are now small, pitiful powers, they stumble after him, holding his tatty, ragged robe as high as possible as they slip and slid on the elephantine droppings he leaves in his wake.

Indeed, this is a wake. The greatest of all empires is dead. The IMF is a cruel, vicious extention of European/American imperial rule. When smaller, former colonial nations in Africa, Asia or South America get in financial trouble, they must go to the IMF for loans. The IMF then ravages their social services, their national infrastracture, their water service, ports and above all, any natural rescources of interest to the rulers of the European/American global empire. The cruelty is so great that up until two years ago, we could read every few months about 'IMF riots' as starving or desperate masses rush their capitals, demanding bread or water!

No more. The IMF is now a puppet show for small children. The rats and vampires who inhabit its halls no longer strike fear in the hearts of the third or second tier nations. Indeed, they are rapidly outpacing the European/American empire! And this is thanks to the greedy rulers of that empire! Hahaha. Talk about turning of tables!

Watch how the demented fool running the IMF talks about hege funds and private equity as being good things! Wow! And then he hedges his rash, foolish comments by talking about how SOME of them MAY have overreached and not understood risk.

If I were the leader of the Furies, I would be rubbing my hands in anticipation for the day I can put Rato in some hell that mimics a third world country run by the IMF! Hell, I would like to park him in Baghdad. Today. Now let's go back to Ratso's ridiculous speech:

6. The economic fundamentals, both in the large industrial economies and in most major emerging economies, including Brazil, remain strong. Our latest projections anticipate sustained global growth of about 5 percent both in 2007, and 2008, with major emerging markets leading the way. However, the balance of risks has tilted to the downside when compared with a few months ago, reflecting the impact of the recent turbulence in financial markets. These risks bear close watching.

7. The principal risk is that financial market developments affect the real economy through declining asset prices, tightening financial conditions with a repricing of risk, and weaker confidence. In such circumstances, the concern would be that consumption could suffer in the United States, producing knock-on effects elsewhere. However, to the extent that financial conditions return to normal, we believe these risks will likely be mitigated, as most corporations remain highly profitable and household finances continue to be sustained by solid employment growth. Thus, the U.S. economy should continue to grow at a moderate pace this year.

Employment is growing? Eh? Wot? Just this month alone, 36,000 real estate/mortgage employees suddenly were unemployed. Not to mention a host of drudges working for dead hedge funds. Are they in better paying jobs this last week? No? Eh? Wot? HAHAHA. Note how the first world imperialists are always utterly cheerful about prospects when they examine their own handsome selves but are picky and whiny when they examine others like say, the Chinese. Like an obese woman judging fashion models with a critical eye, the IMF claims the world's economy will grow 5% but the US will grow, too! How, I ask him?

With China growing a massive 11%+ and Russia growing as well as Brazil...oh, do note how he picks out Brazil! Brazil knows IMF riots. Brazil has been under the IMF thumb and when it doesn't do what the Empire demands, the CIA moves in and helps stage a coup, the murder of indigenous people and students! Argentina and Chile, ditto! The weakness of the European/USA empire is how more and more nations are throwing off not only the IMF yoke but the CIA seems unable to stage coups except in the Gaza Ghetto and the tattered remains of Palestine. Even there, it is a failure. And in Iraq, a giant failure.

The IMF just saw the imperial banks solve a huge collapse of the banking system by simply printing money and giving it away in mass quantities! Wow! Did any of these nations doing this subtract this money from their FOREX reserves? HAHAHA again. No way, Jose'! That is for second and third world nations, not the empires! The Bank of Europe even had the arrogance and gall to openly announce they had INFINITE money to lend! Wow. And the US assured that if they had to lower interest rates and print money, no problem! Whoosh went the presses and voila! Half a trillion in loans appeared magically. Did China loan us all half a trillion? Did Japan? Will I die laughing?

Did the IMF? Don't they have the various top tier nations giving it money to lend in case of national banking distress? Didn't we just have that? And how much did the IMF loan the big banks in the imperial centers? Nothing?

NOTHING! And so the status quo was saved...by cheating. Now we will see these same clowns go to China and lecture the Dragon on sober banking standards and how they must not have inflation! Nope. Inflation is evil except when Germany, England or the USA is inflating. Then it is wisdom. Time to turn to American politics, the heart of the double standard economic rules, the USA and its desire to have something for nothing.

From the Washington Post:

The race for president has a hot new issue: what to do about the economy's credit crunch. And the candidates, as usual, do not agree.

Former senator John Edwards (D-N.C.) wants to allow homeowners to shed "excessive mortgage debt in bankruptcy" and create a large Home Rescue Fund to help prevent foreclosures.

To pay my bills, build a house and fight the sudden injury of my husband in court, my family lived in a tent complex for 10 years. Today, I just went through a very violent storm with 70 mph winds, downpours and trees falling all over the place and back during that time, I had to lie in a hole under the bed where we could be safe if the world crashed in over our heads. We didn't declare bankruptcy. We went hunting for food, I grew food, we had chickens and we had sheep. It was a very harsh life. My family loved much of that time, I was often cheerful while being worried sick.

For example, someone gave me a 50 gallon container of kerosene so I could have lamps at night! Whee! Now back to the wild bidding war for houses: the bidders didn't look to the future. They didn't weigh the consequences of their choices. They didn't pick small houses when tempted by bigger houses. American houses became bigger and bigger and bigger. They ballooned even as the housing balloon billowed ever bigger.

I saw on CNN today a video of a balloon in Canada that blew up and caught on fire and the huge thing came crashing down into a trailer park. This is a good example of our housing situation. How can we reinflate this balloon that should have never happened? Houses wouldn't have risen in cost if the foolish bidders didn't raise the price? The price of rentals actually dropped during this time because everyone was buying. And the population of America didn't double in 5 years but the building of housing acted as if there was this giant wave of new people. Housing in select markets shot up while much of the nation saw housing values fall. For example, in the Midwest, housing was collapsing even when interest rates were low. Everyone wanted to move to fun places: California, Las Vegas, Miami Beach.

Again: this was very childish. The infantilism is obvious. Especially with the gambling dens. This was totally senseless. The ecological stresses created by our madcap housing boom concentrating on building in very inappropriate or useless places is part of this problem. I, personally, don't want to bankroll these people who ran off to California, Florida or Nevada, just for example. If they and the developers were brainless, heedless and plain stupid, why compound this by enabling them to do more?

Indeed, much of this new housing was built where volcanoes, earthquakes, flash fires and hurricanes ravage relentlessly. These are not geological stable places. True, where I live gets hit every couple of hundreds of thousands of years by Ice Ages. But that is quite rare compared to, say, the chances of Miami getting wrecked by a Catagory 5 hurricane or California's San Andreas suddenly jumping north by 500 yards in 2 seconds! Or Mt. Rainier blowing up.

If people want to live in those places, fine. But to charge me trillions of dollars for this privilage, frankly, ticks me off. Very, very much, in fact. If they turn over their McMansions to the government because they bit off more than they can chew, the government can sell them to whomever. But the banks who paid for all this can jump in a lake. My own bank was founded in 1933 by the state workers in NY. This bank has no hedge funds and doesn't play the stupid games these idiots running the California or Florida banks played. They loaned money to fellow bank customers who live here in NY and everyone knows each other. Intimately. They are all state workers and their families!

Once the big banks fall, we can start over again. I will volunteer my own bank, SEFCU, for training courses on how to run a safe banking system. This is after we get rid of the Federal Reserve and the IMF. But right now, the politician's desire to save reckless buyers and stupid bankers is only so they can get money from rich people in trouble who want the Fed to bail them out. I say, fie on all of them.

Washington Post:

Sen. John McCain (R-Ariz.), on the other hand, is eager to avoid a broad and potentially expensive bailout and to target for assistance only the borrowers who have been taken advantage of by lenders.

Buying a house is an important thing. For this, you hire lawyers. A feature of the housing boom was the use of lawyers to find ways AROUND the rules and regulations. And banks conspiring with buyers to goose credit scores that were below 750, for example. Even the Washington Post advised home sellers to go under the table and pass a downpayment as a loan to the buyer so the buyer would get better 'points' and thus, a lower interest rate! Everyone was gaming the system. So the victimizaton was the least of what was going on. Sellers, brokers, real estate agents, refi people, people in homes rising in value so they could tap it for extra money to use to go on vacation, etc: these people are nearly everyone. Who cheated whom? They were all out to get as many bags of money out of this magical system of ever-rising house value coupled with infinite money being created out of thin air at super-low below the rate of inflation interest rates.

This party was missing one person: the savers. And savers are the foundation of any banking system. We lost this. And giving more money to more people who played this game and made this problem appear will utterly destroy us! For already, we savers are pushed against the wall to the point, many of us are buying gold out of total fear! Gold makes no money for banks, so to speak. And smart gold buyers get a safe and lock it up at home so it can't be confiscated like that truck driver with too much cash in Texas.

Washington Post:

Edwards and Sen. Barack Obama (D-Ill.) have called for the creation of a fund by the federal government to help homeowners refinance their mortgages to avoid foreclosure. Edwards has not said specifically where the money for the fund would come from. Obama spokesman Bill Burton said Obama thinks the fund should be "partially paid for by penalties on lenders who acted irresponsibly and committed fraud."

Hahaha. Penalties? Like, the top five banks just had to trot off to the Federal Reserve to get $25 billion each so they could get the system going again? Or why not just drop rates to near zero again a la Greenspan and then give it away? To hell with the savers! And this is the bitter medicine: the only way to fix our broken banking system isn't to save people's houses build in all sorts of utterly inappropriate places but to repudiate the housing boom totally and forbid another from appearing. The last thing we need as infrastructure in the USA is more distant suburbs all over the place that are accessible only by car! And we don't need endless vacation housing. If we can afford this, we can afford to pay the going rate that will appeal to savers so they will allow banks to lend their money again.

Washington Post:

Dodd wants the FHA to provide more loan insurance to those who need it. He has also called for an end to penalties for early payment of subprime mortgages. And he, like other Democrats, would allow the mortgage finance giants Fannie Mae and Freddie Mac to buy more mortgages for their portfolios, which would inject much-needed liquidity into the moribund sector.

Fannie Mae and Freddie Mac had to save us the other two housing bubbles I have lived through and they can't keep doing this forever. Where does their money come from? A printing press under Bernanke's garage? Of course. Which is why we have 'inflation.' I am all for ending the penalties for early paying off of subprime mortgages but only if subprimes are outlawed in the future. Indeed, outlawing all the goofy things we just saw this last 7 years would be the smart thing to do but the banking giants loved the easy money and the elimination of appealing to savers! They want no savers, only saviors in the form of the Federal Reserve!

And why isn't the IMF attacking the Federal Reserve today? HAHAHA. Right.

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Comments

the world's biggest woodpecker - yup - that sounds like all govts everywhere all right!!

and the bear sounds like the advantage takers.

no adults left?

well they/we will have to clean up - at some point.

i too am mad about no reward for saving - and then the media points at us and says - where are the savers - well duh??

love your blog. just love it!! bettyo

Posted by: Betty Old | August 25, 2007 at 09:16 PM

Elaine,

China just called and that want to thank you for the financial advice....

http://www.metafilter.com/64139/Gold-Foil-Hat-Apocalyspe-next-week-Help

After they make their money both ways in late September could you see to it that they send a couple of boxes of Ben Franklins my way?

Posted by: patience | August 26, 2007 at 01:29 AM

Hi, Betty, and thanks for the links, Patience. I followed the link and it went to a dead end as far as information is concerned. It was someone quoting an unknown web site so I put that down as pure rumor until there is hard information.

In banking collapses, holding cash is king. In depressions, cash is also king. In inflation times, hoarding hard goods is king. Gold might not rise in value like various other things but this is due to governments selling gold. The US sold off another $4.5 billion of Fort Knox just this last quarter, for example. Europe has sold literally TONS of gold.

Posted by: Elaine Meinel Supkis | August 26, 2007 at 09:37 AM

Wow!! Love the blog and will be watching for more. I will be writing you to cite some of your clames and get your sources for some research

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