IMF saves the world

What a lovely organisation the IMF is.

THE IMF IS THE BEST THING IN THE WORLD

While we are told there isn’t any more cheap credit anymore, the IMF has it by the bucket load. I’ve noticed it over the last few weeks announcing it’s open generosity to ‘help’ countries. So it’s lending to people that have no money.

The old story.
 
Meanwhile in the credit-less world, the FED lowers interest rates making it cheaper to borrow credit that doesn’t exist when we have been told that it was low interest rates in the early 2000’s that tempted people to take out loans that they couldn’t afford.

My view remains that interest rates do need to come down significantly – and quickly,” Prof Blanchflower told an academic audience in Canterbury – source

One would have thought that if your feet are been eaten by piranhas, the first thing you do is get your feet the hell out of the water. I’m obviously wrong. The best thing to do is immerse your legs too – obviously!
Meanwhile Hungary whose banks I don’t think invested in the US sub-prime market to any great extent is also being bailed out.

The British govt is borrowing in the light of a lack of credit and yet spending loads in “rescuing” banks who still have no credit. A year ago, people wondered why the hell the govt was bailing out the Northern rock rather than just let it fail. It was totally illogical from an economic thing to do then and of course something shady was going on. It should have been allowed to collapse into its own funeral pyre. So why did Darling put about £2000 of debt on every Brits head in saving NR?

It couldn’t be because by taking the first most difficult step along the way to defraud people that they could then say “we have to continue now or we’ll have wasted all that money on NR last year.” – could it?
 From a business point of view it was always the obvious choice to let NR collapse. Once it collapsed, then pick up the pieces. But this wouldn’t have left people scared that they would lose their jobs and homes, so it wasn’t done.

All these gambling dens should be allowed to crumble. It is not in ANY citizens interest to allow these financial pirates to be allowed to be in business. I can’t believe the governments have bought their toxic debts and then thrown credit at them. Now I read the average USan is something like $70,000 in debt, and that’s before all other debts are included.

Does anyone really believe that the village idiot Bush/bLiar/Brown/Skaro.Barelustonly and so on actually have power or influence over what’s happening? They always act in a reactionary manner, indicating there are string pullers working the system and working the glorious “leaders” too.
But back to the lovely IMF.

Big picture digesters know when you take a loan from the IMF, your in BIG trouble. IMF = Instantaneously Monetarily Fooked.

Now the IMF, the European Central Bank and other EU institutions are going to have to step in and support the Hungarian economy with multi-billion dollar loans, and the price they will demand is likely to mean harsh economic reforms and cuts in government spending.  – source

People need the IMF like a hole in the head. Governments know IMF loans really crish their civillians. We’ve seen this virtually EVERY time countries borrow from the IMF. IMF loans are supposed to put the debtor in a situation whereby he cannot repay. That way the debtor nations cedes control over important aspects of the countries economy.

But where does the IMF get this credit/issuance of debt from? Doesn’t it come from member countries? But those countries like the UK are already borrowing heavily. Why are they giving a loan to Hungary for pity’s sake?

Not only that…

“The US seems to be keen to push Pakistan towards the IMF” 
Sartaj Aziz, former finance minister – source

“Iceland’s central bank has raised its key interest rate to 18% from 12%… part of its agreement with the International Monetary Fund, from which it borrowed $2bn (£1.3bn).” – source

People need the IMF like a hole in the head.

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Examination of financial deritatives – scams included.

It seems likely that the derivatives ‘market’ are a most powerful of the powerful scams entertained by the fraudulent financial system we have today.
http://www.theponytail.net/DOL/DOLnode8.htm

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Such things would be impossible under an Islamic system of economics.

Essentially, a derivative is a bet/gamble. The bets are categorized according to some familiar recognisable conditions, such as “futures” and “options” etc.

One might think of ‘interest(rate)’ as being the greatest evil and in most respects you’d be right, becasue it is the doorway through which every other bit of dirty trading, such as derivatives, has come. But what makes derivatives so much more dangerous (IMO) is (that the graphic above highlights) is that you can bet upon a bet.  And it doesn’t stop there. You can then go ahead and then bet upon a bet upon a bet, and so on. – This is similiar to what ‘rogue traders’ (incidently, there only rogue when they lose and therefore gain exposure) like Nick Leeson did. You can try and bet away a bad bet, if that one fails you repackage and wrap your lost bet in an even bigger bet. And it’s not just people like Leeson or Societe Generale’s Jerome Kerviel who do it.

“Professional investment may be likened to those newspaper competitions in which the competitors have to pick out the six prettiest faces from a hundred photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors as a whole; so that each competitor has to pick, not the faces which he himself finds the prettiest, but those which he thinks likeliest to catch the fancy of the other competitors, all of whom are looking at the problem from the same point of view.”

“It is not a case of choosing those which, to the best of one’s judgment, are really the prettiest, nor even those which average opinion genuinely thinks the prettiest. We have reached the third degree when we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practise the fourth, fifth and higher degrees.”

Keynes, John Maynard The general theory of employment, interest and money. (London : Macmillan, St. Martin’s Press, 1936. page 156.

Quote taken from: http://www.projects.ex.ac.uk/RDavies/arian/scandals/derivatives.html

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Bets can be swapped or sold many times over resulting in derivatives being highly complicated, highly interdependent and highly intertwined. If you don’t already, you should by now be having alarm bells going off in your head.

The amount of fictional money that can get tied up is enormous and it’s usually based on virtually nothing. It’s quite similiar to gambling on credit.

Fractional reserve banking is despised by virtually every Joe Soap who (thanks mainly due to the internet) learns about it. Fractional reserve banking involves say, a bank which has $1,000 in its vault being able to  lend out $10,000 or $100,000, that is 1000% or 10,000% respectively the amount it actually has in it’s vault. {example given featuring fractional reserve banking at the 10% or 1% level respectively)

We despise it for a number of reasons, one of which is becasue we have discovered a scam previously hidden from our eyes which we know is fundamentally wrong/corrupt or at the very best, bad practice.

I’m pretty sure that instinctive sence of right & wrong would make us detest financial interest(rates) if we came froma situation whereby it had never been part of out lives, but then suddenly imposiiton of use of interest(rates) is levvied upon us. However, being brought up with interest(rates) as a way of life has clouded our humanistic default hatred of it. And in fact, we are encouraged to engage in it. It’s spun sometimes as being “good”, for example when we chase high interest(rate) savins deposit accounts.

We put our $20,000 in the bank (which it then puts in its vault and then can lend out $200,000 {10% fractional reserve banking} at say 3% as a mortgague for instance, giving an interest payment of 6,000 over 20 years (=$120,000 in interest) plus the capital sum of $200,000, meaning the bank will get paid $320,000 from an initial amount of just $20,000 from you. They might offer you a 15% interest rate on your savings account and so, per year you’d get an extra $3,000. Yet they got $6000 per year, double what they give you, from a loan which they could only offer in the first place becasue you depositied your money with them.

And of course every year they have an extra $3,000 real cash (sadly the mortgague payer can’t pay the loan with conjured up money – but there ins’t anything to stop banks conjuring money!!) which then can go into their vault and become an amount of $30,000 on offer for more loans !!!

& Lets not forget the conditions they impose upon you for using their account. Typically: You can’t withdraw more than a small amount at a time and/or you must maintain a certain amount of savings or end up paying a nasty penalty (giving the banks more real cash to put intheir vaults etc.. etc…) gobbling up YOUR money.

So are these high interest(rate) accounts really “good”?

If you think yes, then you’ve forgotten probably the most painful part about it. Who ultimately pays for your interest? The people who bear the heaviest brunt of this is the most of the 3,000,000,000 people on the planet living on or below the $2 paper dollars a day line (the ‘standard’ of gaguing severy poverty). They pay. So unless you have no heart, surely you can no longer think of interest as good.

{Re: diagram. Some simplification yes, but not bad I feel for 478×533}

Disagree? Perhaps you havent read ‘Confessions of an Economic Hitman’ by John Perkins.

The thing about interest is that it plays a vital role in almost all derivatives, and the people that lose when big powerful companies decide to ‘cash’ in on their derivatives {or hold on to them until they will increase in ‘value’} is naturally enough those LARGE companies and not the majority of people (even in 1st world countries) who aren’t involved in them.

I’ve just started reading Matthias Chang’s “The Shadow Money Lenders” and already in the introduction it’s plain that the scope of the the scam – the derivatives market, is monumental. Cheching out the Apendices, as of Sept 30, 2007, JP Morgan Chase & Co had about $92,000,000,000,000 that’s USD $92 trillion dollars worth of derivatives yet only $1 trillion worth of assets. And this pattern is repeated across the board. Citygroup is next, $39 trillion derivatives, $2.4 trillion assets. This pattern repeats itself for the 25 magacrop institutions presented, giving a total derivative holding of $179 trillion yey only $10 trillion assets.

Almost 18 times the amount of bets and bets of bets (sometimes called hedges) the amount of extra phoney money deeply intertwined across the rotton international banking sector.

Hopefully now the scale of what’s coming is evident. LTMC’s collapse in 1998 simply becasue the Russians defaulted on a bloody loan, was said to have been a whisker away from total collapse of the worlds econony i.e. revelation of the fraud and it’s total disentanglement, {info here and yet more derivatives scam stuff} but since then the market has mushroomed, which to me was the bubble necessary to encapsulate and stave off the milder collapse LTMC would have brought about.

The Future’s bright. The future’s orange.

P.S. and oddly enough, Orange County in the US lost $1.600 million ($1.6 billion) by “trading” derivatives. Wikipedia says of the matter:

“Orange County is a good example of what happens when derivatives are used incorrectly” – WikiLobbox.

 Ho Ho! that’s funny! Well even though much money is probably phoney anyway, but in a phoney system, it’s pretty near real!  But the point here is, the characteristic of derivitives is that somewhere, someone will get burned, like all bets, and that’s their characteristic consequence not the accidental misfurtune [punn not intended] as Wikilobbox portrays.

 

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