New World Order University Forum

As we reported in our post “Putting Humpty Dumpty together,” President Obama’s role in the April G20 meetings was limited to arguing for the preservation of tax havens for the elite U.S.-based corporate criminals.

“Obama’s single contribution to the G20 summit was to negotiate with Chinese Premier Hu Jintao that some offshore tax havens will be left open so that the looters can stash their profits free of taxes or oversight.”

Obama’s ability to prevail over China’s Hu Jintao at this meeting was reported as a “triumph” by the lapdog liberal press. So how is the triumph working out today?

The rest of the world is basically united against further criminal U.S. banker exploitation of the world financial system as so many countries have suffered from the bankers’ devious tricks. Only Barack Obama and Gordon Brown support the criminal interests at Goldman Sachs and The City (London’s bankers). Even Brown and Obama must be careful in their public statements to appear to oppose corruption. But their public statements cover continued pillaging, not only by U.S. and London bankers but by all of the global financial institutions. Actually there is a lot of action at the top of the pyramid as the various mafias attempt to pursue their own interests at the expense of everybody else. Here is a report card on recent maneuvering.

Let’s start with the European Union’s attempt to inoculate themselves against predatory hedge funds. The report is at Spiegel. The debate about hedge funds playing a role in “jump-starting” Europe’s economy, providing needed liquidity, improving efficiencies, and so forth are entirely bogus. Hedge funds magnify market volatility through speculation, and they transfer funds from savers and investors to wealthy speculators. Hedge fund regulation isn’t a solution to this problem. The solution is hedge fund abolishment so capital will not accumulate in ruthless, nonproductive, parasitical hands.

The policy of central banks pumping liquidity into the banking system has not led to loan expansion but to a stock market bubble. Asia Times comments on the world of illusion the G8 ministers live in as they plan an “exit strategy” from excessive central bank lending.

“The monetary base has expanded from US$834 billion in May 2008 to $1,806 billion in May 2009, an increase of about 117%. Such an expansion has never occurred in US monetary history. Consequently, the reserves of the U.S. banking system rose from $45 billion in May 2008 to $933 billion in May 2009, an incredible multiple of 21, while the banking system’s level of excess reserves went up by an even larger multiple, from $2 billion to $877 billion in May 2009.”

You should be able to understand from this article why economists are so worried about inflation or higher interest rates. Actually, looking at China’s new massive issuance of consumer loans, we should be anticipating a similar response from overfunded U.S. banks and a resumption of the credit bubble. That has been the goal of U.S. Federal Reserve policies since the crisis started. But at the moment the large U.S. banks are not cooperating.

W. Stroupe reports that the BRIC nations are embracing the new IMF global currency called special drawing rights. Emerging economies are trying to position themselves out of dollar-based assets in case the U.S. currency goes up in smoke. China and Japan, as the largest holders of U.S. Treasury bonds, want to temper abandonment of the dollar because abandonment means their dollar-based assets lose value. But China is actively pushing for the United States and the IMF to issue bonds denominated in yuan. Panda bonds are their solution to the problem of holding too many dollars. If Panda bonds are a successful strategy, one outcome, besides making China stronger, may be to shift the world’s source of credit toward Asia.

If the dollar gives way, the place to go will be emerging market economies outside Japan and China. Meanwhile, the global resource grab means that a small number of countries and a small number of very large companies are positioned to create monopolistic control over world resources.

Investors are already shifting out of Europe. EVRO Intelligence reports a flight from European bonds. This article also calculates the cost to each European government of its bank bailouts.

Spiegel reports that German banks are investing in German government bonds rather than making new loans. We would expect the same to be true more or less everywhere. The bailed out banks are now excessively capitalized and risk averse. They are not going to act in some “greater interest” than the interest of the bank. Banks don’t pass on interest rate reductions to their customers, either. That’s the problem with bank bailouts, no corresponding sense of obligation on the part of the banks. Look for bank regulators to propose more new regulations to force banks to lend.

Obama’s fight to keep tax havens open has been a boon to the European Investment Bank, the EU’s special bank for third world development loans. The report is at EUObserver. Naive folks who are swept up in the “aid Africa” rhetoric should pay attention to this statement:

“Policy analyst Marta Ruiz explained that often the beneficiary of a project funded by the EIB in Africa is a multinational corporation that sets up a subsidiary in a tax haven like Mauritius.”

These bankers pull five times the amount of aid to Africa out of Africa and into their tax havens. As with hedge funds, the tepid government response is “closer regulation” or “more transparency” so that the crooks can continue their game.

Asia Times reports on how Vulture Funds operate to suck money out of third world governments.

The major spokesmen deplore how Vulture Funds operate, and yet, one of the biggest players of all, the World Bank, is rife with similar corruption. Bea Edwards’ report is carried at Asia Times. In a previous post on World Bank corruption we chided Bea Edwards for being a bit naive. We apologize. Edwards’ reporting is solid and thorough in this longer Asia Times piece. The case studies in India and Vietnam were particularly instructive about how the web of corruption extends from the World Bank through government officials and down to the job site. But we’ll stand by our previous statement that the World Bank is fundamentally corrupt. The World Bank does not have authority to prosecute corruption, only to blacklist future loans to recipients found to be corrupt.

The web of corruption among the global elites may be shrinking a bit due to increased reporting and scrutiny, but so far their initiatives are tepid public relations ploys while they support the same financial institutions that caused the global financial crisis. The New World Order controllers are masters of pretending to fix something while leaving the loopholes open. It looks like the bankers are enjoying the ride while unemployment rises, economies around the world shrink, and the world’s leaders meet at endless summits to negotiate further global integration schemes.

If you support globalism, you are also supporting the corrupt global financial institutions that enrich a few elites at everybody else’s expense.

One point to take away from this analysis: claims that the world needs big international banks as sources of development capital are bogus. The bankers take out more wealth than they put in. Until we put a stop to globalism, there will be only a handful of elite beneficiaries of this corrupt system while everybody else suffers.

Of related interest: Spengler examines Obama’s empty foreign policy. We have wanted to write something about Obama’s pointless travels and empty speeches, but we are so bored by the topic we don’t want to bother. Thanks to Spengler for doing the thankless work for us.

Tags: aid to Africa, Bea Edwards, European Investment Bank, International Monetary fund special drawing rights, international tax havens, New World Order corruption, U.S. bank reserves, vulture funds, World Bank corruption

This entry was posted by Director on Saturday, July 18th, 2009 at 8:42 pm and is filed under Global Economy, Obama Administration, U.S. Economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.