Global financial order should reflect change at G 20 Conference.
November 17, 2008
Well there is going to be change alright and most won’t like it…..You won’t be able to see it at first but eventually the dollar will decline more and cease to be the world reserve currency. It started in 1944 at Bretton Woods and some are calling this Bretton Woods II…..Below is one possible feature of the new financial system:
LESSER ROLE FOR U.S. DOLLAR
- The U.S. dollar has been the linchpin of the world financial system since 1944, when the Bretton Woods conference agreed on a pegged exchange rate system with the dollar as the effective reserve currency.
- Although this collapsed in 1971, when the dollar stopped being convertible into gold and gave way to the current model of freely floating currencies, the dollar has remained the favored international currency, although the euro runs a close second.
- Countries including Italy are keen to broaden the base. “Today the dollar is the currency of Bretton Woods, but now it could be that there will be other combinations. The debate on foreign exchange is being reopened,” Italian Economy Minister Giulio Tremonti said on October 15.
Busted in Washington
By MIKE WHITNEY
As expected, the G-20 Economic Summit in Washington turned out to be a total bust. None of the problems which have pushed the global economy to the brink of disaster were resolved and none of the main players who gamed the system with their toxic securities was held accountable. Instead, the visiting dignitaries settled on a toothless “Statement on Financial Markets” which accomplished absolutely nothing. The one noteworthy clause in the entire document is a two paragraph indictment of the United States as the perpetrator of the financial crisis.
The contagion started on Wall Street and that’s where the responsibility lies. It was the result of the Fed’s reckless low interest rates and lack of government oversight. This allowed market participants to create vast amounts of leverage via speculative bets on under-capitalized debt-instruments. The resulting collapse in value of all asset-classes across the spectrum has created a gigantic multi-trillion dollar capital hole in the global financial system which has precipitated violent swings in the stock markets, tightening credit, currency dislocations, soaring unemployment and deflation. Almost all of today’s economic woes can be traced back to legislation that was promoted by key members of the Clinton and Bush administrations. (Many of who will now serve in the Obama White House) The G 20s statement puts the blame where it belongs; on the Federal Reserve and Wall Street.
But this is old news. There’s no point in rehashing the past unless there’s a real interest in bringing the guilty parties to justice or unless the gathered leaders are serious about establishing the rules for a new economic regime. But they’re not, which is why the confab was just another political gab-fest devoid of any serious reforms.
It was interesting, though, to hear Bush, in a rare, unscripted moment, acknowledge that the extreme steps taken by the Fed and US Treasury–since Bear Stearns defaulted 17 months ago–were intended to avoid what he called “a depression greater than the Great Depression.” That’s quite an admission for Bush, as well as a vindication of what CounterPunch has been saying on this site for more than 2 years. And although Bush rejected any personal responsibility for the policies which led to the crisis, it’s clear that he has some rudimentary grasp of its gravity. That’s a start. As he famously opined to the press, “This sucker could go down”.
Despite the outcry for meaningful reform, the summit only reinforces the status quo; the same old American-led financial system. In fact, there appears to be growing consensus that the IMF should spearhead the programs that provide liquidity to the developing countries that are getting pounded by the downturn. This is a major setback. It restores the IMF–which is the “iron fist” of the US Treasury– to its former glory so it can once again use its extortionist loans to thrust faltering nations into structural adjustment, privatization and slave wages. The meetings are breathing new life into the failed neoliberal policies that should be done away with once and for all.
The G 20 statement invokes the same “pro growth”, free market mumbo jumbo. Pro growth is code for low interest credit which allows market speculators to benefit from the steady flow of cheap capital while workers are stuck trying to make ends meet on stagnant wages and a falling dollar. It’s a way of making sure that the playing field is always tilted in favor of Wall Street. Pro growth does not mean strengthening productive activity or manufacturing goods that consumers want to buy. It means expanding credit through derivatives contracts and other leveraged investments to maximize profits on borrowed money. The long-term objective is to put the financial sector above the productive sectors of the real economy. It is a blueprint for maintaining dollar hegemony and Wall Street’s continued dominance over global finance.
The G 20 statement also rejects protectionism which defends the interests of labor and crucial national industries. Again, this just illustrates the blatant pro-Wall Street bias of the meetings where none of the leaders represented the interests of labor or unions. To hell with the working man.
The group called for more government stimulus to minimize the effects of the frozen credit markets, unemployment and deflation. They also demanded greater “transparency and accountability”, although it will probably amount to nothing. Wall Street is not about to give up the Golden Goose; its off balance sheet operations, its Level 3 “marked to fantasy” assets, its “dark pool” trading, and its opaque, convoluted accounting methods. These are the alchemist’s best friends which allow investment gurus with little talent and even less scruples to weave exotic debt-instruments into pure gold. Expect plenty of lip-service from Paulson and his brood about transparency, while revealing next to nothing about their shady activities.
What’s really needed instead of all this diversionary nonsense is strict compliance to a basic set of rules . The rules for financial institutions have been articulated by many market analysts including Karl Denninger (Market Ticker) in his “Genesis Plan”:
1. Force all off-balance sheet “assets” back onto the balance sheet, and force the valuation models and identification of individual assets out of Level 3 and into 10Qs and 10Ks. Enact this requirement beginning with the 3Q 2008 reporting period which begins next month. [ie All assets must be accounted for on the banks balance sheet. M.W.]
2. Force all Over the Counter (OTC) derivatives onto a regulated exchange similar to that used by listed options in the equity markets. This permanently defuses the derivatives time bomb. Give market participants 90 days to get this done; any that are not listed in 90 days are declared void; let the participants sue each other if they can’t prove capital adequacy. [This creates a public exchange so that regulators know whether derivatives contracts are sufficiently capitalized. M.W.]
3. Force leverage by all institutions to no more than 12:1. The SEC intentionally dropped broker/dealer leverage limits in 2004; prior to that date 12:1 was the limit. Every firm that has failed had double or more the leverage of that former 12:1 limit. Enact this with a six- month time limit and require 1/6th of the excess taken down monthly. [The five largest investment banks claimed an aggregate asset-value of $4 trillion before Bear Stearns defaulted. Many, if not most, of those worthless assets are now on the Fed's balance sheet underwritten by the US taxpayer. Too much leverage, simply means that the taxpayer pays the difference when the bank fails. M.W.]
That’s the bulk of it right there. Follow the rules or go to jail.
The world doesn’t need a new Breton Woods or a new world order; it needs a competing vision of global finance. One that will put an end to dollar tyranny, superpower politics and “beggar thy neighbor” economic policies. A system that strengthens national sovereignty, cooperation, and international law. That’s what the G 20 should have been talking about, instead of wasting their time trying to prop up a system that’s rotten to the core.
Mike Whitney lives in Washington state. He can be reached at fergiewhitney@msn.com
This is a long article…read it here at Counterpunch.com
The world has never seen such freezing heat
November 17, 2008
As you read this remember 31,000 scientists have rejected the lie of “global warming”……global warming is only a way to tax the world’s citizens and have global control over countries.
Climate scientists allied with the IPCC have been caught citing fake data to make the case that global warming is accelerating, a shocking example of mass public deception that could spell the beginning of the end for the acceptance of man-made climate change theories.
On Monday, NASA’s Goddard Institute for Space Studies (GISS), run by Al Gore’s chief scientific ally, Dr James Hansen, announced that last month was the hottest October on record.
“This was startling,” reports the London Telegraph. “Across the world there were reports of unseasonal snow and plummeting temperatures last month, from the American Great Plains to China, and from the Alps to New Zealand. China’s official news agency reported that Tibet had suffered its “worst snowstorm ever”. In the US, the National Oceanic and Atmospheric Administration registered 63 local snowfall records and 115 lowest-ever temperatures for the month, and ranked it as only the 70th-warmest October in 114 years.”
It soon came to light that the data produced by NASA to make the claim, and in particular temperature records covering large areas of Russia, was merely carried over from the previous month. NASA had used temperature records from the naturally hotter month of September and claimed they represented temperature figures in October.
The world has never seen such freezing heat
By Christopher Booker
A surreal scientific blunder last week raised a huge question mark about the temperature records that underpin the worldwide alarm over global warming. On Monday, Nasa’s Goddard Institute for Space Studies (GISS), which is run by Al Gore’s chief scientific ally, Dr James Hansen, and is one of four bodies responsible for monitoring global temperatures, announced that last month was the hottest October on record.
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| A sudden cold snap brought snow to London in October |
This was startling. Across the world there were reports of unseasonal snow and plummeting temperatures last month, from the American Great Plains to China, and from the Alps to New Zealand. China’s official news agency reported that Tibet had suffered its “worst snowstorm ever”. In the US, the National Oceanic and Atmospheric Administration registered 63 local snowfall records and 115 lowest-ever temperatures for the month, and ranked it as only the 70th-warmest October in 114 years.So what explained the anomaly? GISS’s computerised temperature maps seemed to show readings across a large part of Russia had been up to 10 degrees higher than normal. But when expert readers of the two leading warming-sceptic blogs, Watts Up With That and Climate Audit, began detailed analysis of the GISS data they made an astonishing discovery. The reason for the freak figures was that scores of temperature records from Russia and elsewhere were not based on October readings at all. Figures from the previous month had simply been carried over and repeated two months running.The error was so glaring that when it was reported on the two blogs – run by the US meteorologist Anthony Watts and Steve McIntyre, the Canadian computer analyst who won fame for his expert debunking of the notorious “hockey stick” graph – GISS began hastily revising its figures. This only made the confusion worse because, to compensate for the lowered temperatures in Russia, GISS claimed to have discovered a new “hotspot” in the Arctic – in a month when satellite images were showing Arctic sea-ice recovering so fast from its summer melt that three weeks ago it was 30 per cent more extensive than at the same time last year. A GISS spokesman lamely explained that the reason for the error in the Russian figures was that they were obtained from another body, and that GISS did not have resources to exercise proper quality control over the data it was supplied with. This is an astonishing admission: the figures published by Dr Hansen’s institute are not only one of the four data sets that the UN’s Intergovernmental Panel on Climate Change (IPCC) relies on to promote its case for global warming, but they are the most widely quoted, since they consistently show higher temperatures than the others. If there is one scientist more responsible than any other for the alarm over global warming it is Dr Hansen, who set the whole scare in train back in 1988 with his testimony to a US Senate committee chaired by Al Gore. Again and again, Dr Hansen has been to the fore in making extreme claims over the dangers of climate change. (He was recently in the news here for supporting the Greenpeace activists acquitted of criminally damaging a coal-fired power station in Kent, on the grounds that the harm done to the planet by a new power station would far outweigh any damage they had done themselves.) Yet last week’s latest episode is far from the first time Dr Hansen’s methodology has been called in question. In 2007 he was forced by Mr Watts and Mr McIntyre to revise his published figures for US surface temperatures, to show that the hottest decade of the 20th century was not the 1990s, as he had claimed, but the 1930s. Another of his close allies is Dr Rajendra Pachauri, chairman of the IPCC, who recently startled a university audience in Australia by claiming that global temperatures have recently been rising “very much faster” than ever, in front of a graph showing them rising sharply in the past decade. In fact, as many of his audience were aware, they have not been rising in recent years and since 2007 have dropped. Dr Pachauri, a former railway engineer with no qualifications in climate science, may believe what Dr Hansen tells him. But whether, on the basis of such evidence, it is wise for the world’s governments to embark on some of the most costly economic measures ever proposed, to remedy a problem which may actually not exist, is a question which should give us all pause for thought.
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Where’s the Birth Certificate
November 17, 2008
Here’s an legitimate again…if we don’t have anything to hide why not unseal everything?
Where’s the birth certificate?
Posted: November 17, 2008
1:00 am Eastern
© 2008
Incredibly, we are just nine weeks away from inaugurating the next president of the United States and, millions of Americans, still have citizenship eligibility questions that have never been addressed by Barack Obama and his entourage.
All that Barack Obama would have to do to put this issue to rest is release his complete birth certificate, revealing where he was born and who were his parents.
It seems a simple thing.
Personally, I doubt the Democratic Party would be so stupid as to run an ineligible candidate for president of the United States. I doubt Hillary Clinton would have accepted defeat at the hands of a candidate ineligible for the job.
So, it would seem Obama is simply thumbing his nose at the Constitution and the concerns of millions of American people. After all, he has made it clear the Constitution doesn’t mean what it says anyway. It’s all a matter of opinion.
Maybe his intransigence on this seemingly ridiculous matter is just his way of showing he will, as president, consider himself above the Constitution. I don’t know any other way to interpret his behavior, do you?
Until last week, no one in the Obama camp would even comment on the controversy surrounding his complete birth certificate, which has never been released publicly. That changed after much hounding by WND staffers who managed to get one official Obama representative to proclaim – anonymously, I might add – that seven lawsuits filed by citizens trying to secure the birth certificate are “pure garbage.”
Obama’s record of non-cooperation and secrecy has now resulted in conspiracy theories that will plague him throughout his administration if he doesn’t address them now with utter transparence. Do I expect him to do so? No, I don’t.
He not only thinks those lawsuits are “garbage.” Evidently, that’s also what he thinks of the people who truly believe the Constitution means what it says and those who believe there ought to be some controlling legal authority determining Obama’s eligibility for the highest office in the land before he is sworn in Jan. 20.
Count me among those who really want to see that birth certificate now.
Imagine the level of secrecy we can expect from an Obama administration that guards his birth certificate with such tenacity.
I’m calling on Barack Obama today to release the entire birth certificate. And just so there is no mistake about what I am calling for, I want the part of the birth certificate that shows which hospital he was born in and who his parents were. That is the only way to establish if he is truly a U.S. citizen. Further, I am asking as a journalist and pundit that if there is any government agency or government official anywhere on the planet who has inspected the birth certificate and can provide those details to the American people, the time to do so is now.
I’m also calling on all my colleagues, from coast to coast and around the world, not to let this matter drop. Apparently it is a point of real sensitivity with Obama people. Good. Let’s rub it in. Let’s demand he produce the birth certificate at every turn – at every press conference, at every appearance, on every talk show.
Could anything be more important than enforcing the requirements of our Constitution?
This is hardly a laughing matter. The longer this soap opera drags on, the more suspicions it will raise – the less credibility our electoral system will have, the more many people will believe the whole political system is rigged.
Who does that benefit?
I honestly can’t imagine.
What possible motivation could Obama have for not producing this simple, innocuous document that every citizen must produce to get a passport, driver’s license or Social Security card?
Are you curious?
So am I?
Where’s the birth certificate, Sen. Obama?
Steve Hilton
babybttrfly
Mike