Friday, October 15, 2010

Why the U.S. Has Launched a New Financial World War -- and How the Rest of the World Will Fight Back

What is to stop U.S. banks and their customers from creating $1 trillion, $10 trillion or even $50 trillion on their computer keyboards to buy up all the bonds and stocks in the world, along with all the land and other assets for sale in the hope of making capital gains and pocketing the arbitrage spreads by debt leveraging at less than 1 per cent interest cost? This is the game that is being played today.


Finance is the new form of warfare - without the expense of a military overhead and an occupation against unwilling hosts. It is a competition in credit creation to buy foreign resources, real estate, public and privatized infrastructure, bonds and corporate stock ownership. Who needs an army when you can obtain the usual objective (monetary wealth and asset appropriation) simply by financial means? All that is required is for central banks to accept dollar credit of depreciating international value in payment for local assets. Victory promises to go to whatever economy's banking system can create the most credit, using an army of computer keyboards to appropriate the world's resources. The key is to persuade foreign central banks to accept this electronic credit.


U.S. officials demonize foreign countries as aggressive "currency manipulators" keeping their currencies weak. But they simply are trying to protect their currencies from being pushed up against the dollar by arbitrageurs and speculators flooding their financial markets with dollars. Foreign central banks find them obliged to choose between passively letting dollar inflows push up their exchange rates - thereby pricing their exports out of global markets - or recycling these dollar inflows into U.S. Treasury bills yielding only 1% and whose exchange value is declining. (Longer-term bonds risk a domestic dollar-price decline if U.S interest rates should rise.)
More Here..

8 comments:

  1. In this article ,Michael Hudson outlines well the nature of the dollar hegemony Empire system and the background to why America a bankrupt Ponzi economy, is now engaging in wild money printing obliging it to launch currency wars in combination with its military wars against the third World peoples.
    With their own currencies values and economies and peoples livings standard under attack other countries will be forced to respond tit for tat.
    The article gives plenty of food for thought and is well worth reading.

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  2. Floating currencies help address big trade imbalances. As One countries spends more than it products, naturally its currency declines until it reachs a balance or swings the other way. Asia has no allowed its currency to float for decades and has make the whole system instable which will result in a collapse

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  3. Those in the know...Know.

    But as for the 98% of Americans who can't be bothered with numbers and facts...They still live in the Matrix.

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  4. 6:39 You have no clue.
    Stop making arbitrary comments until you develop a fucking intelligence quotient.
    Do not come on here and write total and utter spill until you have a fucking idea of what the situation is about.
    You know fucking nothing so"GOODBYE"Bullshitter.

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  5. 3.40
    this sort of arrogant abusive name calling and your assertion of superior inteligence contributes nothing to a discussion on the real basis for threatened currency wars as outlined in the full article by Hudson.
    Its more constructive to show WHY the comment by 6.39 is one sided and wrong not simply make abusive attacks.
    3.40 you do not even actualy put forward your own alternative view!
    just personal abuse.

    Tell us with some actual facts why 6.39 views are wrong!
    Someone is indeed just being an abusive know all ,high IQ but superior dimwit here!

    Personaly, I think that 6.39 simply repeats the Americanist political propagandist thinking of americans and their Fed -to blame others- for the problems of currency manipulation ,rather than look at the way the dollar hegemony system works .
    A critism of 6.39 could be that 6.39 has clearly not read or is incapable of understanding what Hudson is saying .

    So 6.39 attemps to blame "Asia" without investigating the facts ,just mechanicaly repeating his "we good they bad" understanding of standard US economics.

    "As One countries spends more than it products, naturally its currency declines "

    Now what country might that be over the last few decades ?

    And has its once strong currency been deliberately devalued by its manipulating excesses of money printing?

    Just who has been manipulating the value of currencies used for international trade here?

    Why should the other country be blamed if it only seeks to maintain a stable parity ?

    This currency war by the US using the Dollar Hegemony has actualy been going on for years.

    China for one ,appears to have had enough and decided to fight back and is now telling America it has to solve its own problems, not seek a free ride on Chinas back by exporting its economic crisis, by gettintg other countries to bend over.

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  6. international corps will survive either way, china yaun up?..move to cambodia..move to guatamala...sudan!..haha. all want best currency for exports, why? because big corps will leave otherwise, thus no jobs for them and riots etc..They tell us that it's to devalue USD to bring back jobs..how far would we devalue? big corp can fetch workers for $2-$10 across the globe...makes one think that we're in for some hurt here huh, and has been the trend..or/and the real/other reason is it's a fine way to pay down some US debt, but I dunno. I don't see any one enriched in it except for the fewer, also think step by step it will get more ugly for everyone all over..which is a good setup for a non-competing currency-which is perfect to track and monitor..out of the ashes, control

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  7. 8.16
    international corps will survive either way, china yaun up?..move to cambodia..move to guatamala...sudan!..haha. all want best currency for exports, why? because big corps will leave otherwise, thus no jobs for them and riots etc..They tell us that it's to devalue USD to bring back jobs..how far would we devalue? big corp can fetch workers for $2-$10 across the globe..."
    Globalism
    This was the trap of the Third World economies under the Dollar Hegemony ,the necessity of getting 'development'and a cut for the local elites through building export of labor created wealth economies.
    With the investment of the Elites profits in US treasuries and property bubble bonds .
    A competitive race to the Cheapest labor bottom and even more poverty for most of the worlds peoples.
    Americans loved the Globalism ,the Credit supply vendor finance and the Cheap labor products while whining endlessly they were not up to American standards!
    With the crash of the Great Ponzi Economy Americans will now join the globalist race to the Cheap labor bottom.

    Starting with Austerity.
    In order to expand their own export industries.
    I figure That without the Dollar Hegemony US labor ,in a free trade competitive world, is worth to capital about the same as Chinese labor .
    a few bucks a day and the obligatory company song and kowtow to the boss.
    Enjoy!
    But only if they get can cut the cost of wars get off the unemployment rolls ,pull their finger out and make themselves productive for capital without subsidies .
    A GDP 70% driven by consumption of wealth not labor productivity of wealth will no longer work.

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  8. i love american idols =)

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