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The Dying Dollar
Federal Reserve and Wall Street Assassinate US Dollar
Dr. Paul Craig Roberts
Since 2006, the US dollar has experienced a one-quarter to one-third drop in value to the Chinese yuan, depending on the choice of base.
Now China is going to let the dollar decline further in value. China also says it is considering undermining the petrodollar by pricing oil futures on the Shanghai Futures Exchange in yuan. This on top of the growing avoidance of the dollar to settle trade imbalances means that the dollar's role as reserve currency is coming to an end, which means the termination of the US as financial bully and financial imperialist. This blow to the dollar in addition to the blows delivered by jobs offshoring and the uncovered bets in the gambling casino created by financial deregulation means that the US economy as we knew it is coming to an end.
The US economy is already in shambles, with bond and stock markets propped up by massive and historically unprecedented Fed money printing pouring liquidity into financial asset prices. This month at the IMF annual conference, former Treasury Secretary Larry Summers said that to achieve full employment in the US economy would require negative real interest rates. Negative real interest rates could only be achieved by eliminating cash, moving to digital money that can only be kept in banks, and penalizing people for saving.
The future is developing precisely as I have been predicting.
As the dollar enters its death throes, the lawless Federal Reserve and the Wall Street criminals will increase their shorting of gold in the paper futures market, thereby driving the remnants of the West’s gold into Asian hands.
PBOC Says No Longer in China’s Interest to Increase Reserves
By Bloomberg News - Nov 20, 2013
The People’s Bank of China said the country does not benefit any more from increases in its foreign-currency holdings, adding to signs policymakers will rein in dollar purchases that limit the yuan’s appreciation.
“It’s no longer in China’s favor to accumulate foreign-exchange reserves,” Yi Gang, a deputy governor at the central bank, said in a speech organized by China Economists 50 Forum at Tsinghua University yesterday. The monetary authority will “basically” end normal intervention in the currency market and broaden the yuan’s daily trading range, Governor Zhou Xiaochuan wrote in an article in a guidebook explaining reforms outlined last week following a Communist Party meeting.
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Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following.
Federal Reserve and Wall Street Assassinate US Dollar
Dr. Paul Craig Roberts
Since 2006, the US dollar has experienced a one-quarter to one-third drop in value to the Chinese yuan, depending on the choice of base.
Now China is going to let the dollar decline further in value. China also says it is considering undermining the petrodollar by pricing oil futures on the Shanghai Futures Exchange in yuan. This on top of the growing avoidance of the dollar to settle trade imbalances means that the dollar's role as reserve currency is coming to an end, which means the termination of the US as financial bully and financial imperialist. This blow to the dollar in addition to the blows delivered by jobs offshoring and the uncovered bets in the gambling casino created by financial deregulation means that the US economy as we knew it is coming to an end.
The US economy is already in shambles, with bond and stock markets propped up by massive and historically unprecedented Fed money printing pouring liquidity into financial asset prices. This month at the IMF annual conference, former Treasury Secretary Larry Summers said that to achieve full employment in the US economy would require negative real interest rates. Negative real interest rates could only be achieved by eliminating cash, moving to digital money that can only be kept in banks, and penalizing people for saving.
The future is developing precisely as I have been predicting.
As the dollar enters its death throes, the lawless Federal Reserve and the Wall Street criminals will increase their shorting of gold in the paper futures market, thereby driving the remnants of the West’s gold into Asian hands.
PBOC Says No Longer in China’s Interest to Increase Reserves
By Bloomberg News - Nov 20, 2013
The People’s Bank of China said the country does not benefit any more from increases in its foreign-currency holdings, adding to signs policymakers will rein in dollar purchases that limit the yuan’s appreciation.
“It’s no longer in China’s favor to accumulate foreign-exchange reserves,” Yi Gang, a deputy governor at the central bank, said in a speech organized by China Economists 50 Forum at Tsinghua University yesterday. The monetary authority will “basically” end normal intervention in the currency market and broaden the yuan’s daily trading range, Governor Zhou Xiaochuan wrote in an article in a guidebook explaining reforms outlined last week following a Communist Party meeting.
=======================
Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following.
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Banks Warn Fed They May Have To Start Charging Depositors
The Fed's Catch 22 just got catchier. While most attention in the recently released FOMC minutes fell on the return of the taper as a possibility even as soon as December (making the November payrolls report the most important ever, ever, until the next one at least), a less discussed issue was the Fed's comment that it would consider lowering the Interest on Excess Reserves to zero as a means to offset the implied tightening that would result from the reduction in the monthly flow once QE entered its terminal phase (for however briefly before the plunge in the S&P led to the Untaper). After all, the Fed's policy book goes, if IOER is raised to tighten conditions, easing it to zero, or negative, should offset "tightening financial conditions", right? Wrong. As the FT reports leading US banks have warned the Fed that should it lower IOER, they would be forced to start charging depositors.
In other words, just like Europe is already toying with the idea of NIRP (and has been for over a year, if still mostly in the rheotrical and market rumor phase), so the Fed's IOER cut would also result in a negative rate on deposits which the FT tongue-in-cheekly summarizes "depositors already have to cope with near-zero interest rates, but paying just to leave money in the bank would be highly unusual and unwelcome for companies and households."
If cutting IOER was as much of an easing move as the Fed believes, banks should be delighted - after all, according to the Fed's guidelines it would mean that the return on their investments (recall that all US banks slowly but surely became glorified, TBTF prop trading hedge funds since Glass Steagall was repealed, and why the Volcker Rule implementation is virtually guaranteed to never happen) would increase. And yet, they are not:
Executives at two of the top five US banks said a cut in the 0.25 per cent rate of interest on the $2.4tn in reserves they hold at the Fed would lead them to pass on the cost to depositors.
Banks say they may have to charge because taking in deposits is not free: they have to pay premiums of a few basis points to a US government insurance programme.
“Right now you can at least break even from a revenue perspective,” said one executive, adding that a rate cut by the Fed “would turn it into negative revenue – banks would be disincentivised to take deposits and potentially charge for them”.
Other bankers said that a move to negative rates would not only trim margins but could backfire for banks and the system as a whole, as it would incentivise treasury managers to find higher-yielding, riskier assets.
“It’s not as if we are suddenly going to start lending to [small and medium-sized enterprises],” said one. “There really isn’t the level of demand, so the danger is that banks are pushed into riskier assets to find yield.”
All of the above is BS: lending has never been a concern for the Fed because if it was, then one could scrap QE right now as an absolute faiure. Recall that as we showed recently, the total amount of loans and leases in commercial US banks has been unchanged since Lehman, with the only rise in deposits coming thanks to the fungible liquidity injected by the Fed.
More: Banks Warn Fed They May Have To Start Charging Depositors | Zero Hedge
The Fed's Catch 22 just got catchier. While most attention in the recently released FOMC minutes fell on the return of the taper as a possibility even as soon as December (making the November payrolls report the most important ever, ever, until the next one at least), a less discussed issue was the Fed's comment that it would consider lowering the Interest on Excess Reserves to zero as a means to offset the implied tightening that would result from the reduction in the monthly flow once QE entered its terminal phase (for however briefly before the plunge in the S&P led to the Untaper). After all, the Fed's policy book goes, if IOER is raised to tighten conditions, easing it to zero, or negative, should offset "tightening financial conditions", right? Wrong. As the FT reports leading US banks have warned the Fed that should it lower IOER, they would be forced to start charging depositors.
In other words, just like Europe is already toying with the idea of NIRP (and has been for over a year, if still mostly in the rheotrical and market rumor phase), so the Fed's IOER cut would also result in a negative rate on deposits which the FT tongue-in-cheekly summarizes "depositors already have to cope with near-zero interest rates, but paying just to leave money in the bank would be highly unusual and unwelcome for companies and households."
If cutting IOER was as much of an easing move as the Fed believes, banks should be delighted - after all, according to the Fed's guidelines it would mean that the return on their investments (recall that all US banks slowly but surely became glorified, TBTF prop trading hedge funds since Glass Steagall was repealed, and why the Volcker Rule implementation is virtually guaranteed to never happen) would increase. And yet, they are not:
Executives at two of the top five US banks said a cut in the 0.25 per cent rate of interest on the $2.4tn in reserves they hold at the Fed would lead them to pass on the cost to depositors.
Banks say they may have to charge because taking in deposits is not free: they have to pay premiums of a few basis points to a US government insurance programme.
“Right now you can at least break even from a revenue perspective,” said one executive, adding that a rate cut by the Fed “would turn it into negative revenue – banks would be disincentivised to take deposits and potentially charge for them”.
Other bankers said that a move to negative rates would not only trim margins but could backfire for banks and the system as a whole, as it would incentivise treasury managers to find higher-yielding, riskier assets.
“It’s not as if we are suddenly going to start lending to [small and medium-sized enterprises],” said one. “There really isn’t the level of demand, so the danger is that banks are pushed into riskier assets to find yield.”
All of the above is BS: lending has never been a concern for the Fed because if it was, then one could scrap QE right now as an absolute faiure. Recall that as we showed recently, the total amount of loans and leases in commercial US banks has been unchanged since Lehman, with the only rise in deposits coming thanks to the fungible liquidity injected by the Fed.
More: Banks Warn Fed They May Have To Start Charging Depositors | Zero Hedge
U.S. 10yr RISING FAST AGAIN!!! 2.810%, Treasury Delays 3-month, 6-month Bill Auctions Due To Technical Glitch
December 2nd, 2013
Read more at U.S. 10yr RISING FAST AGAIN!!! 2.810%, Treasury Delays 3-month, 6-month Bill Auctions Due To Technical Glitch | InvestmentWatch
.S. 10 Year Treasury Note - 2.810%
TMUBMUSD10Y Bond Quote - U.S. 10 Year Treasury Note Bond Price Today (TMUBMUSD10Y:TPI) - MarketWatch
Treasury delays 3-month, 6-month bill auctions
WASHINGTON (MarketWatch) – The weekly 3-montha and 6-month Treasury bill auctions set for later Monday have been delayed until Tuesday, the Treasury Department announced. In a brief statement, the Bureau of Public Debt said the auctions were rescheduled due to an error that occurred during a test of the department’s auction system. The settlement data and all other aspects of both of these auctions remain unchanged, the statement said.
Treasury delays 3-month, 6-month bill auctions - MarketWatch
Auction System Failure Forces US Treasury To Postpone 3, 6-Month Bill Auctions
While nobody is impressed by breaking equity and options markets anymore, since this has become a virtually daily ocurrence and the habituation level is high, bond markets, and especially the US government’s “guaranteed” bond issuance machinery, are a different matter altogether. Which is why any time something out of the ordinary happens, people pay attention. Such as what happened moments ago when the US Treasury announced that it would delay the closing of the 3 and 6 month Bill auctions, originally scheduled to close today, to tomorrow.
The reason: “an error that occurred during a test of Treasury’s auction system.”
This is curious, as it implies there was a test of the system running concurrent with the actual bond auction. One wonders if instead of the stated reason, there simply wasn’t yet another “glitch” with TAAPS, which as we reported in September, had an error due to an order by none other than Goldman Sachs, being stuck in the quere, for reasons unknown resulting in yet another abnormal 3 and 6 month Bill auction.
Auction System Failure Forces US Treasury To Postpone 3, 6-Month Bill Auctions | Zero Hedge
The cracks in the dam keep growing…
From Brian Rogers
There Will Never Be A Failed US Treasury Auction… Until There Is
Guest Post: There Will Never Be A Failed US Treasury Auction... Until There Is | Zero Hedge
Read more at U.S. 10yr RISING FAST AGAIN!!! 2.810%, Treasury Delays 3-month, 6-month Bill Auctions Due To Technical Glitch | InvestmentWatch
December 2nd, 2013
Read more at U.S. 10yr RISING FAST AGAIN!!! 2.810%, Treasury Delays 3-month, 6-month Bill Auctions Due To Technical Glitch | InvestmentWatch
.S. 10 Year Treasury Note - 2.810%
TMUBMUSD10Y Bond Quote - U.S. 10 Year Treasury Note Bond Price Today (TMUBMUSD10Y:TPI) - MarketWatch
Treasury delays 3-month, 6-month bill auctions
WASHINGTON (MarketWatch) – The weekly 3-montha and 6-month Treasury bill auctions set for later Monday have been delayed until Tuesday, the Treasury Department announced. In a brief statement, the Bureau of Public Debt said the auctions were rescheduled due to an error that occurred during a test of the department’s auction system. The settlement data and all other aspects of both of these auctions remain unchanged, the statement said.
Treasury delays 3-month, 6-month bill auctions - MarketWatch
Auction System Failure Forces US Treasury To Postpone 3, 6-Month Bill Auctions
While nobody is impressed by breaking equity and options markets anymore, since this has become a virtually daily ocurrence and the habituation level is high, bond markets, and especially the US government’s “guaranteed” bond issuance machinery, are a different matter altogether. Which is why any time something out of the ordinary happens, people pay attention. Such as what happened moments ago when the US Treasury announced that it would delay the closing of the 3 and 6 month Bill auctions, originally scheduled to close today, to tomorrow.
The reason: “an error that occurred during a test of Treasury’s auction system.”
This is curious, as it implies there was a test of the system running concurrent with the actual bond auction. One wonders if instead of the stated reason, there simply wasn’t yet another “glitch” with TAAPS, which as we reported in September, had an error due to an order by none other than Goldman Sachs, being stuck in the quere, for reasons unknown resulting in yet another abnormal 3 and 6 month Bill auction.
Auction System Failure Forces US Treasury To Postpone 3, 6-Month Bill Auctions | Zero Hedge
The cracks in the dam keep growing…
From Brian Rogers
There Will Never Be A Failed US Treasury Auction… Until There Is
Guest Post: There Will Never Be A Failed US Treasury Auction... Until There Is | Zero Hedge
Read more at U.S. 10yr RISING FAST AGAIN!!! 2.810%, Treasury Delays 3-month, 6-month Bill Auctions Due To Technical Glitch | InvestmentWatch
My co-worker was telling me to go with Scott Trade... I don't know much of shit about stock trading. But i've always wanted to but never really jumped into it, it seems so easy yet so complicated. I'm actually majoring in Business/Finance. Haven't decided if Business Admin, Finance or Accounting although it looks like Finance is the way to go.
A word of advice, to get your feet wet or just as additional strategy, I would suggest watching the ones the heavy hitters invest in like Buffett and Soros or others with great track records. For instance, I bought into a certain stock because I saw it was almost 3 full points less than what one of the big dogs paid for it. They bought 400k shares and I knew they weren't going to sell it for a million+ $ loss. Even if I sell it at their break even point, I make nearly $3 per share or ~30% profit.
With the QE tapering going into effect, the overall speculation is that the market will drop, but for us outsiders it is all pure speculation and guess work, so buyer beware.
Mutual funds provide better portfolio balance as well. Being young, a dip for us is recoverable, which is why we can afford high risk, but a mutual fund spreads the holdings (but you prob know that already through your education).
With the QE tapering going into effect, the overall speculation is that the market will drop, but for us outsiders it is all pure speculation and guess work, so buyer beware.
Mutual funds provide better portfolio balance as well. Being young, a dip for us is recoverable, which is why we can afford high risk, but a mutual fund spreads the holdings (but you prob know that already through your education).
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You think so? Its their data mining potential that makes them valuable, which is why they received CIA front funding as start-ups. Their revenue is driven by advertising dollars, so I think I understand what your saying, as their popularity and use subside so would their relevance, but I think the execs have other plans for these companies to change with the times (time will tell).
Props:
short and short
Don't be silly
@emma
Beanie Babies fell off hella years ago. But if you can get your hands on a Glo worm you'll be set for retirement when they make a come back in 2026 and the price of the OG ones skyrockets to over a millyan.
@emma
Beanie Babies fell off hella years ago. But if you can get your hands on a Glo worm you'll be set for retirement when they make a come back in 2026 and the price of the OG ones skyrockets to over a millyan.
Props:
emma and emma
