The Fed Chairman Calls For A New International Monetary System

In my article The Debt Bubble Is About To Pop Creating A Debt Cemetery, I write: Ben Bernanke came along and appraised the US and international banking situation and seeing the plunge both in the Landesbank shadow banking system liabilities and the traditional banking systems liabilities, decided to integrate the US banks, KBE, and the too-big-to-fail-banks, RWW, into the central bank via the Fed’s QE TARP Facility.

This constituted a financial and banking coup. This “nationalized” the banks, and in the process of capitalizing them with 1.2 Trillion of US government bonds, which now reside as “excess reserves” at the Fed, privatized the nation’s wealth into the hands of the bankers, and socialized the losses of the bank’s toxic debt to the taxpayers.

The value of the excess reserves, can be observed over time by following  the ETFs EDV and  TLT. When the bond market does turn down, the 1.0 Trillion in excess reserves will simply rot away, that is deteriorate. I do not believe the banks will pull their US Treasuries out of excess reserves and sell them and go short the stock or bond market or buy gold or silver.

The value of the toxic assets residing at the US Fed, can be approximated by observing the mutual fund FAGIX as it has a balanced portfolio of distressed securities. Yes, one can us FAGIX as a proxy to determine the value of the Federal Reserves holdings at any point in time.

And through Quantative Easing 2, he has done even more damage by monetizing the US debt, which has stimulated the bond vigilantes to call the interest rate on the US Government 30 Year, $TYX, bond higher. 

This in conjunction with European sovereign debt shocks stemming from a run on Ireland Banks and a call by Mrs Merkel for a sovereign debt crisis mechanism, has called interest rates higher in Europe and globally.

This has enabled the currency traders to start a global currency war on November 5, 2010, where they sold the world’s currencies, DBV, and the emerging market currencies, CEW, initiating a global bear stock market.  The currency traders are now the world’s sovereign powers; they govern the world economy.

Mike Mish Shedlock in article Bernanke Seeks New International Monetary System, reports: “In speeches before a European Central Bank conference in Frankfurt, Ben Bernanke went on an unprecedented attack, accusing China of throwing a monkey wrench into the global recovery, blaming China for slow global growth and a potential End To The Tepid U.S. Recovery. He also said “The current international monetary has a structural flaw” calling on the “global community, over time, to devise an international monetary system that more consistently aligns the interests of individual countries with the interests of the global economy as a whole.” Finally, he put up a misguided defense of Quantitative Easing that is sure to not go over well in the global community.”

Ben Bernanke’s words are prophetic. I believe that out of a soon coming global economic breakdown, that a global Seignior, an Old English word meaning top dog banker who takes a cut, will arise and establish a global currency system.

In my article, The Debt Bubble Is About To Pop Creating A Debt Cemetery, I provide further thoughts about the soon coming global currency system.

Keyword: globalcurrency, globalcurrencywar


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