by Jim Willie, Golden Jackass via Silver Doctors:
The aggravated global financial situation is working toward a series of powerful climax events. It cannot be saved. It is cratering. It is rotting from the inside. It is fracturing. It will fail. The fiat paper currency system and its many attendant systems are seizing up, being rejected, and are failing in what has begun to be the grandest financial event in modern history.
Last weekend, the Chinese announced the creation of a new 100 billion Yuan fund which will operate more like a window to convert sovereign bonds to Gold bullion in very high volume. The target is the ever-present toxic USGovt debt paper cluttering and contaminating the global banking system. The conversion to Gold bullion will be seen as a declaration of financial war. We are entering a new phase.
In 2006 my work warned that China will move from outsourced producer to trade partner, then to trade rival, finally to opponent in trade war. They are moving to executioner of the King Dollar.
The aggravated global financial situation is working toward a series of powerful climax events. The various USDollar platforms are either undergoing seizure or suffering from abandonment by primary players. The grand Reich Finance application is failing finally, with extraordinary lies, propaganda, market rigging, doctored statistics, and $trillion patches leaking. The Western banking system is being lashed at another level, after the multi-lateral lashing with derivatives tied the big Western banks all together following the Lehman killjob in 2008. A new global lashing has begun to show itself, yet another obscenity.
Witness the export of QE globally by the USFed via the unlimited vast Dollar Swap facilities (massive slush funds). The new 5 BLICS nations under Western thumb are being used to purchase huge tracts of USTreasury Bonds, surely using Dollar Swap funds, on behalf of the USFed master criminal organization. One is left to wonder what the sweetener was for the five nations, like perhaps shared narcotics funds, or a promise of hidden banking system relief. The self-dealing using nations to buy USTBonds with free money has come to the fore, in another desperate attempt to save the system. It cannot be saved. It is cratering. It is rotting from the inside. It is fracturing. It will fail. The fiat paper currency system and its many attendant systems are seizing up, being rejected, and are failing in what has begun to be the grandest financial event in modern history.
Review many of the extreme events in progress to conclude a systemic failure occurring in full view. It will be very difficult to paint this wall effectively with a phony message before it crumbles and falls. World’s central banks hit the panic button in early May. Once again their actions are proving that all Western markets are rigged. For Germany and Italy each to sport negative (or near negative) bond yields on their 10-year security is a grand obscenity and perversion. Bond market bailout is constant, control universal, using derivative props, a true disappearance of free markets. The USTreasury Bond market has been effectively destroyed, the convulsion phase having begun. The QE is not stimulus, but instead more like an overdose of potassium to the heart. The USTreasury Bond market is dying a horrible death. It is ruined by USFed monetary policy, in parallel to the wrecked economies from capital destruction. QE is fast killing the USTBond market, whose dead features are easily identified. The systemic risk is rising quickly. A solution is urgently required, rooted in Gold.
- USTreasury Bond market volume is down markedly to danger levels
- USFed is the principal buyer, lapping up all paper sold
- USFed soaks up Indirect Exchange in the $billions for foreign asset purchases
- USFed uses fake money to cover hidden derivative losses in the $trillions
- USFed balance sheet has turned toxic, with cancerous growth
- REPO market dried up, stuck in reverse
- Dollar Swap market dried up, stuck in reverse
- Negative interest rates at big banks, stuck in reverse
- Yields are hyper-sensitive with no stability, due to diminished liquidity
- Money market funds are a wasteland with no returns given
- Hidden Petro-Dollar damage from dismantled derivatives
- Strain to the primary bond dealers (surprised not all dead yet)
- Strain to pension funds and insurance companies, stuck in mud
- The USFed is exploiting secondary nations to export QE, a global lashing.
MEET THE BLICS NATIONS
The USFed is using derivatives and formal vehicles to integrate the bond monetization scheme. To be sure, QE is being exported via a global integration process, using several front offices under control. A vast new lattice work is under hidden construction. They involve permanent reciprocal currency arrangments, whereby foreign outpost central banks tap Dollar Swap lines to invest in USTreasurys. Witness emergence of the BLICS (not BRICS) nations, a new proxy entity. QE is being exported. The systemic risk is being spread to secondary nations, whose endorsement might be laced with deep bribery and privilege, if not protection. The credit goes to Chris Hamilton, in his Hambone’s Stuff analysis. The Jackass takes no credit, except to stand on a hill and trumpet the QE export claim in global contamination of the monetary system and universal spread of risk. Let us expound upon his work, and provide some details, which include two of his graphics. The data is from public source, namely the TIC Report from the USGovt. The banking leaders who have sacked control of the USGovt have a perverse practice to inform their victims.
USEconomic growth has been both a fraud and a fallacy since 2007. Both Zero Interest Rate Policy and Quantitative Easing serve as life support in a bizarre episode from the Twilight Zone which has merged with our reality. The US Federal Reserve is using 17 central banks working in concert through currency swaps to maintain the fraudulent monetary system, which are probably tied into Forward Rate Agreements (FRA) and Interest Rate Swap derivatives between central banks.
Chris Hamilton states, “QE is when the USFed and USGovt stepped in and took over the economy in order maintain asset values. The USFed and USGovt intervened in markets to artificially increase asset prices and create [if not] enhance the wealth effect for unsuspecting sheeple masses. The global govternments and central banks began their debt binge to postpone the inevitable crash, kicking the can down the road. The landing strip is fast approaching and the plane’s nose is down, but the plane’s landing gear wheels are not. What comes is a crash of epic proportions or a statist market take-over, or possibly a market holiday where asset valuations are politically determined and set by controlling governments.” The end of free markets occurred long ago. Next comes the end in a politically stamped and approved openly visible process, where working toward a controlled financial economy has failed in a glorious manner.
In the last three years, tremendous distress has befallen the USTreasury Bond complex. If not the London Whale event, or JPMorgan bankers leaping out of buildings, or the Belgium Bulge of $420bn in USTBonds exposed, it has been misdirections like Operation Twist to conceal the vast shifts behind the USFed walls. Legitimate buyers of USTBonds have largely vanished. Taking their place is the main QE window, JPMorgan derivative machinery, Wall Street carry trade, and hidden BLICS hands. The USFed has exported QE while it claims to wind it down. The criminal banking syndicate has been integrating the USTBond purchase program to new proxy fronts. The TIC Report reveals their identity, all friends to the fascist state. Notice the huge decline in official bond holdings by the typical traditional former allies. No more!
BELGIUM, LUXEMBOURG, IRELAND, CAYMAN, SWISS
The hidden evidence is coming to the fore. The challenge is to identify which entities are buying USGovt debt in the form of USTreasury Bonds. The USFed is no longer permitted to purchase additional USGovt debt issuances due to its ownership limits, unless it changes the portfolio rules. Or else, the USFed chooses not to add to its $4.5 trillion toxic balance sheet, since wrecked beyond repair. In recent months, six nations have been carrying the load of maintaining USTreasury yields at ZIRP. Those nations are Japan and the BLICS: Belgium, Luxembourg, Ireland, Cayman Islands, and Switzerland.
From June 2011 to January 2015, the USFed has bought $825bn in USTreasurys, while the BLICS have quietly bought $818bn in USTreasurys during the same timespan. These are small nations without huge trade surpluses. The source of data is the Treasury International Capital (TIC) Report provided by the Federal Reserve itself. The only remaining offices for purchasing USTreasury debt securities comes down to just Japan and BLICS nations. The USGovt and USFed have conspired as a Ponzi Scheme, using digital counterfeit to purchase perhaps all net new USTreasury debt since July 2011. QE has been exported in a den of thieves and a nest of lies.
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