More Mad Max Dot Connecting

[Celebration]

http://wallstreetexaminer.com/blogs/winter/?p=1537

The absolute orgy of Dollar recycling continued this week, the time to the tune of $18.7 billion added to foreign central banks (FCB) custodial holdings. In reality the Ponzi finance source has never been more flush. Since January 10, the tally is $156.2 billion or $625 billion annualized, for a 30% growth rate. This in turn is fueling the hyper-inflationary Mad Max effects in these countries as they turn to the printing press to offset this operation.


The operation works like this: exporters (or speculators) bring USD to Saudi Arabia’s or Taiwan’s central bank (FCB), etc, etc, and exchange USD for local currency. FCB prints the money to fund the USD exchange, and then ships the USD hot potato back to the US via securities purchases. Export/speculators take the local currency and get a hold of goods, commodities, and materials causing even more maladjustment, crack up boom hoarding, and now hyper-inflation. This results in too many trashy US securities (and debt to foreigners) outstanding, and too much local currency abroad. In the example of hoarding I note from the March 29th Economist, an article called Pile Up a chart (that I can’t replicate) showing 60 million tonnes of iron ore stockpiles sitting in China’s ports. That’s up from 40 million tonnes last summer, and is probably just the tip of the crack up boom.

Now that the USD recyclers economies are being wrecked in an orgy of suicidal self-abuse, one would think that the dots would have been connected long ago. It is no longer just that these FCBs hold severely overpriced Treasury and housing agency securities ($2.215 trillion worth), now that have infected the entire planet with hyper-inflationary conditions. It truly appears that they intend to wait for the palaces to be stormed before doing anything (too late) about it.

[snot]

1. Are you saying 30% per annum has been the rate re- the USD? nt

[Celebration]

2. it means the annualized increase in USD paper

Held by the foreign banks.

We are in a state of complete imbalance. Since the foreign banks have to exchange the money, they put their excess dollars into our paper. Why? I don't know. It's causing inflation in their countries. Craziness abounds.