"More yet!"

 

My buddy would say if I was backing up in the truck

Or lifting up on something :-).

So yeah:

More yet about the $.

Weaponising US dollar and monetary policy risks setting the global economy on fire

April 22nd

(Could?

looks like it already has honestly.)

"When global finance is used to punish political adversaries and economic competitors rather than promote growth, it undermines a global public good"

"For the US too, a powerful currency is also a double-edged sword"

"With the world likely to head towards a recession, what is the future of the US dollar and monetary policy?

Two weeks ago, I explored how difficult it was to know where to put your money in a world turned upside down because of financial and geopolitical risks. There are no simple answers because how you allocate your money depends on your risk appetite and your exact circumstances, which is why broad strategies don’t work in times of massive change."

"Caught in a world between higher inflation, geopolitical risks and possible recession, central bankers in the advanced markets are rethinking what to do in a period when monetary policy has to respond to splits in global supply chains disrupted by tight labour markets and Russia’s invasion of Ukraine."

(Somebody knew what they were doing and the time was right to do it. At some point you just have to face the facts and admit it to yourselves.)

"The global financial system is being split from a dollar-dominated system into one likely to be in blocs with different payment systems. The US dollar system will be dominant for a while yet, but the more the currency is used in terms of sanctions, the more users will want to move away from it."

(I agreed with that March 1, 2022, ask yourself, who else to you know that did?)

"Global finance is seriously conflicted 

as to its real objectives –

 promote growth, 

control inflation 

or go fight the next war."

That might be the most astute statement I've seen of our current situation in a long time.)

"Basically, the four top central banks – the US Federal Reserve, European Central Bank (ECB), Bank of Japan (BOJ) and People’s Bank of China – together run monetary policy for the world as they operate the key reserve currencies."

(Good point.)

"However, the Fed is clearly heads and shoulders above the rest because of the dominant position of the US dollar, which accounts for about 60 per cent of global foreign exchange reserves. The ECB has been expansionary, but the leading quantitative easing champion is the BOJ, whose balance sheet is now 125 per cent of Japanese GDP."

(The other guy on the Financial times piece said 55%, but then lowered it to 47% when analysing its purchasing power. Guess which # I would go with if I was you?

Yeah...

47%

couple that with:

With BRICS countries having more of global GDP?

 Than the G7?

 For the first time ever in 2022?

And hows that grabbing ya right about now huh?

Oh yeah, inflation has peaked BTW.

Sarcasm.)

"When the Fed, ECB and BOJ started on quantitative easing after the 2008 global financial crisis, their balance sheets increased six times from US$4.6 trillion at the end of 2007 to US$27.9 trillion at the end of 2020."

(An increase in $'s 6x over what previously existed, and in only 13 years, and people cant figure out what caused inflation?

They know.

They just dont want you too.

Inflation is always the RESULT of something that was done, it doesn't just happen on it's own.

Our only choice? 

Was to crash the system. 

QE, Bond purcahes, $ printing, all of it.

Our officilas knew where it was going eventually.

It was the only way we could limp our system along a lil farther.

To, as my son would say:

"It's ultimate eventuality."

which is where we are rn.)

"During this period, their total financial assets dropped as a percentage of total Group of 20 (G20) financial assets from 75.5 percent to 63.7 per cent. In the meantime, slower growth in those three economies meant their share of G20 GDP dropped from 66.1 per cent to 56.1 per cent."

(Aging populations aren't really good for growth BTW.)

"If you strip off the veil of money, you would discover that money and finance are like a shell game that hides what is happening in the real economy – the things that matter, such as jobs, food, health and so on. Essentially, life is about reciprocity – if you owe someone, you have to pay back sooner or later in material goods, services or just making that person happy."

(Oh its a shell game alright:

Mark Hanna: Number one rule of Wall Street. Nobody - and I don't care if you're Warren Buffet or if you're Jimmy Buffet - nobody knows if a stock is going to go up, down, sideways or in circles. You know what a fugazi is?

Jordan Belfort: Fugayzi, it's a fake.

Mark Hanna: Fugayzi, fugazi. It's a whazy. It's a woozie. It's fairy dust. It doesn't exist. It's never landed. It is no matter. It's not on the elemental chart. It's not fucking real.")

"It is very powerful and can be weaponised, giving the US government the ability to sanction any dollar holders. However, the neocons in Washington tend to forget they are recommending the US fight World War III on a credit card."

(Not to mention 6500 miles across the pacific

against a modern reconstituted navy

250 miles from it's supply lines etc...)

"The US national debt is already at the same level in relation to GDP that it was at its peak at the end of World War II. At the same time, other people around the world likely understand that holding more US dollars could mean they are funding the next US aircraft that might bomb them to smithereens."

(Countries have woke up and the US weaponizing the $ has just accelerated that process. Seems like everything is in a state of "acceleration" post Covid doesn't it? I wonder why that could be? :-)

Building toward something :-)

Promise.)

"The conclusion is that if the US, European and Japanese central banks keep easing monetary policy to continue supporting their financial system and rescue their economy from recession, the implication is to weaken their currencies. If so, we could get a situation where everyone else starts to devalue their currencies, sparking a global race to devaluation will end up with stagnation and higher inflation."

(Guy nails it.

The only way to save the system is to collapses the currency basically.

"The lack of available good options? To the myriad crisies we Face? 

Tells you exactly where we are.

But, collapsing the currency results in the systems collapse.

It's quite the conundrum to say the least.

Have you talked to your creator lately?

Y'all on good terms?

Do you do it often?

Somebody else got a Holy Book 

that's being played out right in front of their eyes?

Like this one:

Come share it with me.

I wanna know what it says.

There isn't one I assure you.

That might be trying to tell you something.

It really might.

"In a nuclear war, all currencies and financial systems will be nuked. That is the ultimate de-dollarisation."

"Weaponising the world’s money is killing global public goods. If you want a brawl, please don’t break the bar."