The Competing Currency War threatens to disrupt international relations
The year 2013 will be the year when the USDollar is isolated and set up for rejection
A return to the Gold Standard is in the works. The key to the solution is a USDollar alternative, actually trade settlement outside the USD
A Gold Trade Note is coming, the basis of Eastern trade, serving as a Letter of Credit
THE CURRENCY WAR HAS REACHED A HIGH FEVER PITCH
Watch for a G-20 Meeting flash point, especially if the US & UK boycott the conference in Moscow beware the requiem for the US nation.
(Reuters) - The global “currency war” could get even worse if Europe joins the fray, says the man widely credited with coining the term.
Brazilian Finance Minister Guido Mantega told Reuters European countries should focus on reviving their economies with more investments, rather than trying to weaken the euro to protects jobs as France has suggested ahead of next week’s meeting of G20 economic powers.
Global ‘credit supernova’ turns 2013 bull into bear. Bill Gross warns about Fed’s cheap-money schemes.
Bill Gross predicting a “Credit Supernova.” Yes, that’s what the “Bond King” sees dead ahead. He knows, his firm has $2 trillion at risk of collapsing into the “Black Hole” coming after the Credit Supernova, when the Federal Reserve cheap money finally explodes in America’s face, brings down the economy, again.
Gross’s Credit Supernova metaphor is the explosive headline on his latest Pimco newsletter. So what’s a supernova? Jump over to the Space.com’s parallel universe where you’ll discover a supernova happens when a “blindingly bright star bursts into view in a corner of the night sky … burns like a … brilliant point of light.”
A supernova is “the explosion of a star that has reached the end of its life … Supernovas can briefly outshine entire galaxies and radiate more energy than our sun will in its entire lifetime.”
Yes, a supernova is the “explosion of a star that has reached the end of its life.”
“End of its life?” Is America’s star economy burning out? Sure sounds like it: Gross is doing more than just hinting with his Credit Supernova metaphor. He’s predicting the collapse of the American economy and global financial markets, far worse than the 2008 Wall Street bank credit collapse, worse than the 2000 dot-com crash.
As the folks over at Business Insider put it: “Investment banks have morphed markets with ‘Ponzi Finance.’ And time is almost up.”
Trouble Coming to Paradise: The Real Economy Fades Rapidly After Each And Every Infusion Of Promises From The Central Banks
The Macro Indicators are signaling there is potential trouble coming to paradise.
Goldman Sachs points out in a recent study that there is a remarkably strong correlation which has emerged as a result of global central bank policy initiatives. The steely eyed Tyler Durden at Zero Hedge points out:
We have noted the odd cyclicality in macro data (and its leading effect on the market) and it seems Goldman Sachs has also noticed that something is different this time. For 15 years, the seasonal patterns in Goldman’s macro index have been mild to totally negligible; but since 2009, something changed.
As the chart below indicates, it really is different this time as the macro cycle has become extremely short and consistent (drop in H1, rise in H2) – and is evident not just top-down but bottom-up in payrolls and ISM for instance. Goldman expounds pages of statistical jiggery-pokery to show what we suspected – that this is not weather or seasonality effects, and is not just US (UK and Europe see same pattern of six month cycles); but appears driven by central-bank policy actions (which have been more concentrated in Q4/Q1). 2013 is playing out exactly as the last three years has – with a downdraft that is set to continue for the next few months – though they note that stability in oil prices this time (and recent expansion of easing efforts – Fed and BoJ) may shift the pattern. For now, it appears the macro cycle is becoming shorter and warrants concern as they are unable to find anything but ‘reality’ as a driver of this odd cyclical pattern as the real economy fades rapidly after each and every infusion of promises from the Central Banks.