0% Global Interest Rates Totally Destroys Banking

[Joanne98]

October 29, 2008

Elaine Meinel Supkis

World stock markets are shooting up like a rocket based on the perception that the G7 central bankers and politicians will restart the destructive status quo that involves the US allowing the flood of exports to enter our country and devastate our industrial base. Great news, eh? All this will be fed by an orgy of 0% financing. Sounds like all those auto commercials. As we watch the entire concept of banking go into this moral collapse, it pays to look closely at the deals we are accepting here. Just like those auto loans at a fake 0% interest rate: read the fine print and see the truth.

Three-Month Libor for Dollar Falls to 3.42 Percent, BBA Says

The comparable euro rate fell 2 basis points to 4.83 percent today, the 15th consecutive decline, BBA data showed.

The LIBOR rate is finally falling. Or so hope our foolish experts. If only they can get this low enough, all will be well! I recall, during the previous 20 years, everyone who pretends to be economic experts marveled at how cheap credit was and how low inflation was, that is, after the 1971-1982 waves of increasingly bad hyperinflation.

I lived through this entire span of time as a working mother who had to cope with these waves of inflation as well as swimming in the real estate shark pool a lot of the time. So I always was hyper-aware of the interest rate fluxes. Also, we did business overseas so we were aware of currency valuation fluxes, too. Since this is personal and not something I read in a book, I have vivid memories of my problems during this time and how I coped with these sometimes, huge problems.

From 1971 onwards, as the US government and the private banking conspirators in the Federal Reserve struggled to keep the economy growing while piling up huge debts thanks to wars, the goal was always to have credit as cheap as humanly possible. The business about 'taking away the punchbowl when the party gets interesting' was just pure propaganda.

At no point has this ever happened. In the past, the Fed raised interest rates whenever anyone overseas came to knocking at the front gates of Fort Knox, demanding their new-minted dollars which often were created overseas via lending, be turned into physical gold. For example, when the Fed dropped interest rates to restart the US economy after the Great Crash of 1929, France merrily made loans in France based on their DEBT trade with the US and then they raided Fort Knox for gold! Even as the government was demanding the US bankroll Germany's reparations by lending to Germany so Germany could give these dollars to the US and then France would take these same dollars and trot back to the US to demand gold!

Now, we don't care about any of this since Europe tried this yet again in the 1960's and drained away 75% of the gold at Fort Knox. Now, we simply have no gold peg. Nations now live with this floating currency game which is making many people very rich and even more people, very poor.

The LIBOR rates are now dropping but are still hundreds of basis points above the fake rates set by the central bankers. The news that the LIBOR has dropped has to be offset with the news that the LIBOR drop hasn't even begun to catch up with the rate of artificial drops being engineered by the punch bowl boys in the central banks.

Continued>>>
http://elainemeinelsupkis.typepad.com/money_matters/2008/10/elaine-meinel-supkis--------------british-leader-calls-for-larger-imf-bailout-fund-prime-minister-gordon-brown.html

[Joe Chi Minh]

1. Wow. What a fascinating article! But more scary than anything, in that Elaine sees

a Keynesian economic policy as risible, but she does not suggest an alternative (at least an explicit one), which would not be much harsher on the population, for whom obviously unemployment would continue to soar.

One positive aspect I believe in, but which Elaine does not seem to consider at all, is synergy. I'm very much of the view that when people really work together for the common good, from the richest to the poorest, it will produce unexpected synergies. God will give "increase", as it were. Not that steering most of the richest away from enmity to the common good would be the easiest of undertakings.

[flamingdem]

2. I agree with you and think that Obama will spark synergy

and the cooperation of the world to solve economic problems.

(But it won't be easy.. no no no)