A grim Ministry of Finance report circulating in the Kremlin today states that the shocking record rise this past week of the United States outstanding debt to $15.692 trillion (just $600 billion short of their debt ceiling) has pushed the world’s most powerful economy into a situation of its outstanding obligations now being 101.5% of its entire gross domestic product (GDP), which when coupled with Japan’s announcement (the world’s second most powerful economy) that they are following the US into the global Currency War all but seals America’s “national economic suicide.”
Brazil's Finance Minister, Guido Mantega, coined the term “Currency War” in 2010 and has repeatedly blamed rate cuts by central banks in the US, Europe, and Japan, for unleashing a “monetary tsunami” that now threatens to destroy the entire Global economy.
Important to note, this report says, is that immediately after the 2008 Economic Collapse, the United States, Japan and the European Union were facing a “financial Armageddon” of historic proportions as nearly every major bank in the Western world all went broke at the same time.
In order to prevent the collapse of the entire global economic system, this report continues, the US Federal Reserve secretly conducted the biggest bailout in the history of the world to the tune of over $16 trillion which it gave to virtually every major bank and financial institution in America, the EU and Japan.
The name given to this secret bailout of the Western banking system by the US Federal Reserve was called “Quantitative Easing” (QE) which they described as a programme allowing newly created money to be used for buying government bonds or other financial assets. The US Federal Reserve pointed out that QE was different than just printing money out of thin air because that would implies that the newly minted money would be used to directly finance government deficits or pay off government debt (also known as monetizing the government debt), which, in essence is exactly what they did.
Though denied by the US that it is printing money, this report says, the effects of “money for nothing” are readily evident by anyone who buys anything and notices that with each passing week the prices of even the most basic commodities are rising faster than the wages that buy them.
One of the many examples outlined on this in the report is the price of gasoline in the US, where on 31 December 2008 it was at a then 5-year-low of $1.61 a gallon, but as of today is near $4.00 a gallon, all of which Russian Finance Ministry officials blame on the devaluation of the US Dollar because of the Federal Reserves printing of money to give to all of their broke banking elite “friends.”
In an act of “blatant hypocrisy,” this report continues, the US has gone so far as to attack their largest creditor, China, by blaming them for keeping their currency to high, while all the while ignoring the fact that the Chinese currency has appreciated by 31.4% against the US Dollar since mid-2005 due entirely to the Federal Reserve’s continuing to print what will soon become “worthless paper.”
So dangerous and reckless has the US become that Stephen Roach, the non-executive chairman of Morgan Stanley Asia, told Emerging Markets in a telephone interview this past week that, “It seems to me that the scale of this policy blunder is painfully reminiscent of the Great Depression in the 1930s.”
Making this dire situation even worse were the Japanese opening fire in the Currency War this past week when the Bank of Japan announced they would follow the example of the Federal Reserve and print up $61 billion of “new money” to inject greater liquidity into their already stagnant economy. And Japan’s move follows the European Central Bank's decision to inject of €530 billion into the Eurozone banking system in yet another “money printing” scheme to keep their economy from going over a cliff.
In response the Western banking giants efforts to collapse the entire global economy those few responsible nation not printing new money have angrily fired back, and as we can read, in part, as reported by South Africa’s Mail & Guardian News Service in their article titled “BRIC's Sabres Rattle As Global Currency War Heats Up”:
“As political rhetoric heats up, fears are mounting that a global currency war may escalate -- concerns explicitly expressed by the Brics countries -- Brazil, Russia, India, China and South Africa -- in a recent communiqué.
“Excessive liquidity from aggressive policy actions taken by central banks to stabilise their domestic economies have been spilling over into emerging economies,” they wrote following a summit in India, "fostering excessive volatility in capital flows and commodity prices”. In diplomatic speak, that's the equivalent of “knock it off”. The implied threat -- particularly from Brazil -- is “or else”.
Driving the point home, Brazil's President Dilma Rousseff reiterated the group's concerns to US President Barack Obama at meeting in Washington in April. “Expansionist monetary policies,” she said, “ultimately lead to depreciation in the value of the currencies of developing countries, thus impairing growth outlooks.”
To how far the US, EU and Japan will go in continuing to destroy their economies is not known, but with new reports now showing that the United States is preparing military re-education prison camps for their citizens, the EU is being warned that it faces “uncontrollable protests,” and Japan faces an historic energy crisis after all of its nuclear reactors go offline tomorrow, one can only wonder where our world goes from here.
Sorcha Faal
WhatDoesItMean
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