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Wednesday, 1 July 2015

Greece Surrenders its Sovereignty to Brussels


The Syriza government is backing down after the realization that Brussels will declare economic war on Greece by deliberately trying to plunge the country into total ruin, far worse than the sanctions imposed on Russia. This is a sad day for the entire world. It is a terrible example that the Troika is the new equivalent of a Roman Triumvirate – the death of democracy. Europeans will remember this day for it is when national sovereignty died.

We have a copy of a letter sent from Greece to the EU accepting all terms. This is a surrender of sovereignty and no doubt the truth of this turnaround will be hidden from the public at large worldwide – not just the Greek people. All our fears of moving into Economic Totalitarianism are coming true. Democratic principles are dead: long live Totalitarianism. No doubt, this was the toast in Brussels last night (behind the curtain, of course).

The Great Banking Game of the BIS

Tony Montana: Black market lord, servant to the international oligarchy.

Tony Montana: Black market lord, servant to the international oligarchy.

Greece is now in the news for the left socialist Syriza Party caving (predictable) to the IMF’s economic terrorism, resulting in bank runs and capital controls.  Echoing the previous two bail outs back to 09 and 10, the new “plan” will undoubtedly result in more collateral seizure of Greek assets for the engineered debt crisis shock doctrine that controls virtually all nations.  Nothing new here, but it is illustrative for understanding the global banking structure that emerged from World War II at the Bretton Woods Conference in 1944.  However, as we will see, the real structure extends further back into the shadows of World War I.

Originally Bretton Woods’ plan tied to the U.S. dollar-backed by gold, in 1971, the dollar became fiat (Nixon shock), resulting in a global fiat system centered around command and control large-scale economic planning and fixed exchange rates.  Under he guise of economic stability, the ruse was sold that this system would provide “security” and prevent rampant speculators from wrecking economies due to tying them to central banks.  While there is some truth to this position of regulation limiting rampant speculation, the limitations of central banks only works if central banks are independent and national, printing their own currency.  Of course, they are not, and the ability of the megabanks to own national economies through bailouts and being “too big to fail” shows however well-intentioned or effective that may have been in the past, it is no longer the case.

The Marshall Plan was an aspect of this Bretton Woods restructuring for Europe, and in regards to the incorrect myth of western conservatives concerning the ridiculous notion that the U.N. was a “Soviet Plot” (when the land was donated by the Rockefellers), Dr. Kerry Bolton cites Quigley:

The eminent American historian Carroll Quigley, Foreign Services School, Georgetown University, Harvard and Princeton, describes the post-war situation leading to the Cold War, stating that the immediate policy of the USA rested on free trade and aid via the Marshall Plan which would have included assistance for economic recovery to the Soviet bloc. However the USSR saw this as a means for the USA to establish its pre-eminence in the post war era. Quigley, a liberal globalist who saw the “hope” of the world being through a world government, wrote:

On the whole, if blame must be allotted, it may be placed at the door of Stalin’s office in the Kremlin. American willingness to co-operate continued until 1947, as is evident from the fact that the Marshall Plan offer of American aid for a co-operative Europe recovery effort was opened to the Soviet Union, but it now seems clear that Stalin had decided to close the door on co-operation and adopted a unilateral policy of limited aggression about February or March of 1946. The beginning of the Cold War may be placed at the date of this inferred decision or may be placed at the later and more obvious date of the Soviet refusal to accept Marshall Aid in July 1947.[14]

Quigley refers to the American initiative for atomic energy “internationalization” and how this arguably very dangerous scenario for world domination was again scotched by Stalin:

The most critical example of the Soviet refusal to co-operate and of its insistence on relapsing into isolation, secrecy, and terrorism is to be found in its refusal to join in American efforts to harness the dangerous powers of nuclear fission.[15]

This was the reason for the Cold War, and while the dialectic was in a sense managed, it another sense it was not.  The atomic race is connected to this, as the Baruch Plan was rejected by the USSR, as the U.S. sought to use energy dominance as a means of overt control. Aside from these matters, the Cold War was also fueled economically as a race to further hedge control on the part of the Anglo-American Atlanticists through shadow banking power.  Targeting Russia as the continual “Great Game” foe, the Atlanticists’ global economic structure allowed the West to establish the means of economic terrorism through the IMF and other entities, as I have highlighted with Yeltsin and Russia in the 90s, and the Ukraine coup more recently.

Bolton again comments on Bertrand Russell and the Fabian Atlanticists genocidal attitude towards CIA and NGO operations against Russia, even in the Stalinist regime:

Pacifist guru Bertrand Russell wrote in 1946 in the Bulletin of Atomic Scientists, expressing frankly the liberal internationalist attitude towards the USSR, which was anything but benign. Russell, who was to play a key role along with many other eminent liberals and leftists as Stalin-hating Cold Warriors in the CIA founded Congress for Cultural Freedom,[26] makes it plain that the atomic bomb represented the ace card to the forcible establishment of a world state:

The American and British governments… should make it clear that genuine international co-operation is what they most desire. But although peace should be their goal, they should not let it appear that they are for peace at any price. At a certain stage, when their plans for an international government are ripe, they should offer them to the world… If Russia acquiesced willingly, all would be well. If not, it would be necessary to bring pressure to bear, even to the extent of risking war.[27]

Seen in this context, the 2009-2015 Greek financial crisis can be understood as a maintenance of the Greek participation in the EU, as well as making sure Greek does not pivot towards Russia.  Syriza’s leftist socialism even appears to play into the oligarchical cabal by putting on a front of opposition to the IMF’s shock therapy, while caving within no time in surrendering a platform that was all centered around further IMF loan sharking.  This is why the banking oligarchs have perpetually funded and supported leftist, socialist and internationalist movements, as they have a common universalist impetus – the so-called humanitarian human rights initiative.  As Plato noted, democracy leads to tyranny and mob-ocracy, run by oligarchs. Why might this be?

“Democracy” is premised on the lowest common denominator as a cult of conformity. Built within it are the seeds of its own self-consuming destruction, as the bar for universalist “unity” is continually lowered and mass marketed based on the appeal to baser and baser appetite fulfillment of the utilitarian “happiness” principle. Of necessity, it must politically force the false equalitarian conformism it’s based on universally, leaving total destruction in its path.  This is why the mega-banks and their NGOs, think tanks, shell companies, intelligence agencies and social engineers constantly foist endless color revolutions, terror groups, hashtag revolutions, terror groups, etc., because the wrecking ball power these destabilizing groups have are tremendously advantageous to centralized (banking) interests seeking consolidation of national assets, economies and pensions (as well as running black markets!).

At the apex of this public structure is the Bank for International Settlements, the central bank of central banks.  Ironically, the BIS issues reports that are at times accurate, warning the policies of their dozens of member banks are rather destructive, even mentioning the toxic nature of public-private debt mixing scams. Admitting the perpetual debt-based hole is unsustainable, the banker members don’t seem to pay much attention to these “warnings” – in other words, reading a little between these lines, the policies parasitically wreck and loot the host nations.

A bankster-dominated speculative economy that is government-backed by the collateral of the people’s savings and wealth quickly devolves from a production-based economy to a financial gambler’s speculative economy.  As we read concerning the BIS’ own statement, it becomes evident the global government was in the process of consolidation at the time of even World War I through the Young Plan and the BIS as a management of reparations (a World War prior to Bretton Woods, the IMF and World Bank).  The real reason it was established was a secretive CIA-Swiss enclave for world management where the Swiss government has no jurisdiction.  Throughout the Cold War, this oligarchy was emboldened to expand into international control through the continual looting of Russia or any of its potential allies:

“Established on 17 May 1930, the Bank for International Settlements (BIS) is the world’s oldest international financial organisation. The BIS has 60 member central banks, representing countries from around the world that together make up about 95% of world GDP.

The head office is in Basel, Switzerland and there are two representative offices: in the Hong Kong Special Administrative Region of the People’s Republic of China and in Mexico City.

The mission of the BIS is to serve central banks in their pursuit of monetary and financial stability, to foster international cooperation in those areas and to act as a bank for central banks.”


Manhattan Apartment Prices Soar To Record On Billionaire Bid

Three weeks ago in “Beef Prices Hit Record: Up 30% In The Past Two Years,” we noted that although the Fed may continue to claim inflation is non-existent, for those Americans who can't afford a house and thus have to rent, inflation is all too real.

The soaring cost of housing is a topic we’ve covered extensively and indeed, as we showed in “America’s Housing Problem: Buying And Renting Are Both Unaffordable,” many Americans face the rather harrowing prospect of not being able to afford a downpayment (even at the token 3% level now allowed by Fannie and Freddie) while facing an inexorable rise in rents, meaning, in WSJ’s words, that many households are“stuck between homes they can’t qualify to purchase and rentals they can’t afford.” 

In the latest example of the soaring cost of living in America, Manhattan apartment prices just hit a record, with average sale prices leaping 11% to an astounding $1.87 million in Q2, the highest in the quarter or so century of record keeping.

 Bloomberg has more:

The average sale price of all co-ops and condominiums was $1.87 million, up 11 percent from a year earlier and the highest in 26 years of data-keeping, according to a report Wednesday by appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate. Resale apartments and units in new developments each set their own price records amid interest from both investors and buyers who intend to live in the homes.


Buyers clamoring to own property in Manhattan found few choices on the market, pushing them into bidding wars, especially for resale apartments. Listings totaled 5,730 at the end of June. While that’s up 1.3 percent from a year earlier, the inventory is still 20 percent below the 10-year average, according to Miller.


Resellers have been hesitant to list their homes because rising prices may leave them unable to trade up, Miller said. At the same time, developers adding new units to the market have focused on building ultra-luxury towers aimed at billionaire investors as a way of recouping their high land costs.

Yes, a boom in “ultra-luxury” units “aimed at billionaires”, a sure sign (not really) of a healthy market and further evidence that thanks to seven years of global QE and ultra-accommodative monetary policy that has served to balloon the assets of the wealthy, the super rich (and perhaps a few oligarchs) are now clamoring for ways to spend it all and once you’ve added to your $100 million home collection and bought a few Picassos at Christie’s, we suppose a luxury unit or two overlooking the New York skyline is just as good a place as any to park a few million. Here’s Bloomberg again:

The owners of a co-op at 360 W. 20th St. sold the property last month for $700,000 more than they were seeking after a bidding war broke out among 14 interested buyers, said Meris Blumstein, the Corcoran Group broker who sold the Chelsea property.

The sellers listed the renovated two-bedroom apartment near the High Line in March for $2.5 million, the lowest they were willing to accept. A month later, the unit, which includes a 650-square-foot (60-square-meter) yard and temperature-controlled wine storage for 240 bottles, went into contract with a buyer who agreed to pay $3.2 million.

Another seller in the neighborhood, Victor Vecchiariello, listed his West 23rd Street condo for $999,000, and attracted several bids at an open house held on a snowy day in March. On the advice of his broker, Scott Harris of Brown Harris Stevens, Vecchiariello held a second open house and ended up selling the 754-square-foot apartment for $1.28 million.

One or two of the bidders “might have said, ‘I’m going to step away,’” said Vecchiariello, a partner in Ernst & Young LLP’s tax division. “But most of them came back. They upped their offers a bit.”

So there you have it America, you are being priced out of homeownership by the bored billionaire crowd thanks in no small part to the lunatics in the Eccles Building who, if asked, will swear that any day now, the fabled "wealth effect" will finally begin to trickle down, and maybe then, you too will be able to afford to purchase a home or, at the very least, scrape together enough to pay rent on your one bedroom apartment which, as we've shown, may currently be a rather monumental task.

The 75 Trillion Dollar Shadow Banking System Is In Danger Of Collapsing

Shadow Banking System - Public Domain

Keep an eye on the shadow banking system – it is about to be shaken to the core.  According to the Financial Stability Board, the size of the global shadow banking system has reached an astounding 75 trillion dollars.  It has approximately tripled in size since 2002.  In the U.S. alone, the size of the shadow banking system is approximately 24 trillion dollars.  At this point, shadow banking assets in the United States are even greater than those of conventional banks.  These shadow banks are largely unregulated, but governments around the world have been extremely hesitant to crack down on them because these nonbank lenders have helped fuel economic growth.  But in the end, we will all likely pay a very great price for allowing these exceedingly reckless financial institutions to run wild.

If you are not familiar with the “shadow banking system”, the following is a pretty good definition from investing answers.com

The shadow banking system (or shadow financial system) is a network of financial institutions comprised of non-depository banks — e.g., investment banks, structured investment vehicles (SIVs), conduits, hedge funds, non-bank financial institutions and money market funds.

How it works/Example:

Shadow banking institutions generally serve as intermediaries between investors and borrowers, providing credit and capital for investors, institutional investors, and corporations, and profiting from fees and/or from the arbitrage in interest rates.

Because shadow banking institutions don’t receive traditional deposits like a depository bank, they have escaped most regulatory limits and laws imposed on the traditional banking system. Members are able to operate without being subject to regulatory oversight for unregulated activities. An example of an unregulated activity is a credit default swap (CDS).

These institutions are extremely dangerous because they are highly leveraged and they are behaving very recklessly.  They played a major role during the financial crisis of 2008, and even the New York Fed admits that shadow banking has “increased the fragility of the entire financial system”…

The current financial crisis has highlighted the growing importance of the “shadow banking system,” which grew out of the securitization of assets and the integration of banking with capital market developments. This trend has been most pronounced in the United States, but it has had a profound influence on the global financial system. In a market-based financial system, banking and capital market developments are inseparable: Funding conditions are closely tied to fluctuations in the leverage of market-based financial intermediaries. Growth in the balance sheets of these intermediaries provides a sense of the availability of credit, while contractions of their balance sheets have tended to precede the onset of financial crises. Securitization was intended as a way to transfer credit risk to those better able to absorb losses, but instead it increased the fragility of the entire financial system by allowing banks and other intermediaries to “leverage up” by buying one another’s securities.

Over the past decade, shadow banking has become a truly worldwide phenomenon, and thus it is a major threat to the entire global financial system.  In China, shadow banking has been growing by leaps and bounds, but this has the authorities deeply concerned.  In fact, according to Bloomberg one top Chinese regulator has referred to shadow banking as a “Ponzi scheme”…

Their growth had caused the man who is now China’s top securities regulator to label the off-balance-sheet products a “Ponzi scheme,” because banks have to sell more each month to pay off those that are maturing.

And what happens to all Ponzi schemes eventually?

In the end, they always collapse.

And when this 75 trillion dollar Ponzi scheme collapses, the global devastation that it will cause will be absolutely unprecedented.

Bond expert Bill Gross, who is intimately familiar with the shadow banking system, has just come out with a major warning about the lack of liquidity in the shadow banking system…

Mutual funds, hedge funds, and ETFs, are part of the “shadow banking system” where these modern “banks” are not required to maintain reserves or even emergency levels of cash. Since they in effect now are the market, a rush for liquidity on the part of the investing public, whether they be individuals in 401Ks or institutional pension funds and insurance companies, would find the “market” selling to itself with the Federal Reserve severely limited in its ability to provide assistance.

As far as shadow banking is concerned, everything is just fine as long as markets just keep going up and up and up.

But once they start falling, the whole system can start falling apart very rapidly.  Here is more from Bill Gross on what might cause a “run on the shadow banks” in the near future…

Long used to the inevitability of capital gains, investors and markets have not been tested during a stretch of time when prices go down and policymakers’ hands are tied to perform their historical function of buyer of last resort. It’s then that liquidity will be tested.

And what might precipitate such a “run on the shadow banks”?

1) A central bank mistake leading to lower bond prices and a stronger dollar.

2) Greece, and if so, the inevitable aftermath of default/restructuring leading to additional concerns for Eurozone peripherals.

3) China – “a riddle wrapped in a mystery, inside an enigma”. It is the “mystery meat” of economic sandwiches – you never know what’s in there. Credit has expanded more rapidly in recent years than any major economy in history, a sure warning sign.

4) Emerging market crisis – dollar denominated debt/overinvestment/commodity orientation – take your pick of potential culprits.

5) Geopolitical risks – too numerous to mention and too sensitive to print.

6) A butterfly’s wing – chaos theory suggests that a small change in “non-linear systems” could result in large changes elsewhere. Call this kooky, but in a levered financial system, small changes can upset the status quo. Keep that butterfly net handy.

Should that moment occur, a cold rather than a hot shower may be an investor’s reward and the view will be something less than “gorgeous”. So what to do? Hold an appropriate amount of cash so that panic selling for you is off the table.

In order to avoid a shadow banking crisis, what we need is for global financial markets to stabilize and to resume their upward trends.

If stocks and bonds start crashing, which is precisely what I have projected will happen during the last half of 2015, the shadow banking system is going to come under an extreme amount of stress.  If the coming global financial crisis is even half as bad as I believe it is going to be, there is no way that the shadow banking system is going to hold up.

So let’s hope that the financial devastation that we have seen so far this week is not a preview of things to come.  The global financial system has been transformed into a delicately balanced pyramid of glass that is not designed to handle turbulent times.  We should have never allowed the shadow banks to run wild like this, but we did, and now in just a short while we are going to get to witness a financial implosion unlike anything the world has ever seen before.