This would actually be a blessing in disguise, especially for the people of Japan, China and S. Korea. Because the US has had a trade deficit for more than 45 years straight, trading partners have had to accept US treasury bonds for goods. Since China already has over $1 trillion, along with Japan, they have the perfect reason for not buying anymore US treasury bonds, althugh they had the perfect reason a long time ago: we prodece thingds, send them to the US and get wothless pieces of paper that say IOU. These countries can now use those resources to upgrade their own standrds of living, instead of importing inflation from the United States . The real loser is the American consumer who will be paying alot more for what he used to get for cheap and at the same quality. When China Japan, Korea, and the rest of the world, realize that The US is the largest debtor nation in the history of the world, and they’re not getting paid back the full amount of their bonds, either through default or devaluation of the dollar via infltion,ie QE 1-3. and possibly QE4 when the next recession hit, which is already long overdue, they are going to start selling treasury bonds like a hot potato at the same time the Federal Resreve back is also supposed to be unwind8ng its $4.5 trillion balance sheet of US bonds and mortgaged backed securities into the open market.
If everyone is selling US bonds, who’s going to be buying as the 35+ year bond market bubble pops? . And since global interest rates worldwide are the lowest in over 5,000 years, when they begin to rise sharply, over one quadrillion in derivitives will collapse making the 2008 crises look like a pimple on a big fat white gluteus maximus. The entire credit mrket will freeze because every asset had counterparty risk which defaulted and created another chain reaction. The only asset which is not simultaneously somebodyelse’s liability is holding physical gold. Has been for over 5,000 years, and still is now.
0 ( +0 / -0 )
If Trump is right, the less government you have, the more your economy grows through competition and less regulations. Since government doesn't produce anything, it has to suck the wealth out of what's left of a real economy.
0 ( +0 / -0 )
America, the number 1 consumer nation, is also the largest debtor nation in the history of the world. That's only counting Treasury Bonds. Forget about over $100 trillion in unfunded liabilities and personal debt. When the largest customer has over 94 million people, the largest in history, not participating in the labor force, and over 40 million on food stamps, rents rising over 8% per year, what disposable income is left for imports?
-1 ( +0 / -1 )
Didn't more people die from napalm filled bombs dropped on Tokyo, which burned people alive? That's pretty much been erased in Western history books. But then again, the victor usually rewrites the history to their vantage.
-3 ( +2 / -5 )
No mention, that the global economic recession, might be due to global government debt, which now exceeds over $260 trillion dollars. The US is the largest debtor nation in the history of the world, while Japan has the highest debt to GDP ratio of any industrialized nation at over 260%. No mention that it might be time to consider cutting government to a level where they won't have to borrow from the future and tax people through currency devaluation, ( inflation). No, they want to focus on tax evasion. Yes, with so much debt, they need negative interest rates just to make the payments. Problem is, people will take their money out of the bank and put it in a safe at home. Solution for the bankers: In the name of keeping us safe from money laundering, tax evaders, it's time to outlaw cash!! Yes, force people to keep their hard earned savings in a bank, in digital form, and charge them for it! What better way to tax people without them even knowing it? Then everyone gets a digital chip, like a branded cattle, where all there finances can be seen by their respective masters in government. Round the sheep up, build walls around each avenue of escape, and get them ready for slaughter.
2 ( +3 / -1 )
Gold is up almost $20 an ounce today after this announcement made the dollar weaker against the Yen, in addition to the Federal Reserve move NOT to raise interest rates. The scheme of central bank round coordinated devaluation is coming to an end because the Shanghai physical gold market which opened on April 19th, 2016 is causing arbitration in the paper market of COMEX. In other words, paper gold contracts are being replaced by the real thing. There's a reason why gold has been money for over 5,000 years: governments can't print it up from thin air.
-1 ( +1 / -2 )
As I recall, global stock markets crashed in January, the most in history, after the Federal Reserve rates 25bps on December 16, 2015. So it was probably, a knee jerk, flight to safety reaction. Except, they're jumping from the frying pan into the fire. Sure, as owner of the world's reserve currency, the dollar, the US can simply print as much money as it wants and go into as much debt as it wants. But what you get back, isn't going to have the same purchasing power when the bond matures, because the real rate of inflation is much higher than governments report.
0 ( +2 / -2 )
The world went on a grand experiment in the global currency system on August 15th, 1971 when President Nixon defaulted on the Bretton Woods agreement signed after WWII. The dollar was agreed to be the World's Reserve Currency after WWII, because they had the strongest economy, and they scared the daylights out of everyone by dropping nuclear bombs on Hiroshima and Nagasaki. But the most important factor, was that the US would back the dollar with gold, at the rate of $35 and ounce for any trade imbalances. So holding the dollar was as good as holding gold at that time. All other currencies were linked to the dollar, which was linked to gold. After Nixon broke that link, governments around the world were free to print as much paper currency as they wanted and go into unlimited debt, which in effect is borrowing from future earnings to fund the present. We now stand at an unprecedented $230 trillion in worldwide government debt. The US is the largest debtor nation in the history of the world. A benign sounding 2% inflation rate, compounded will wipe out the purchasing power if a person lives to an average of 75 years. Add to that, a negative interest rate, and you'll be lucky to buy a bento for lunch when you reach retirement age. The good news, is that every 70 years or so, we have a global monetary reset. That's where the world's reserve currency changes hands, because the current holder has reckless monetary policy, but even more, nobody wants to hold their debt because they print more paper to borrow more money just to pay the interest on that debt. It's already happened twice in recent history. Once before WWI, and again prior to WWII.
2 ( +5 / -3 )
US banks were fined over $200 billion the last couple years but nobody went to jail. The department of justice, led by Eric Holder, an Obama appointee said, "they're just too important to prosecute". You see, the US is the largest tax haven in the world. You just have to be in the right club.
-2 ( +1 / -3 )
The crime rate will only get worse as Abenomics has only served the very rich and made the common man worse. Don't feel too bad, it's the same playbook from the US.
-1 ( +0 / -1 )
The last six months have seen manufacturing in the US decline 16 consecutive quarters, ( not seen outside a recession), food stamps spiking up, debt spiking, and the amount of part time low paying jobs increasing dramatically. Yea, and Obama says, just believe, hope and change, believe, and you'll feel a lot better.
-1 ( +0 / -1 )
There's no evidence that printing more money out of thin air increases the wealth of a nation. However, it does increase the wealth of those at the top who get the money first, and hurts the guys at the bottom who might get some of the crumbs.
-1 ( +0 / -1 )
With sales dropping in the US, and minimum wage in California to climb to $15 an hour by 2022, its a smart move. The US consumer, about 60%, are living paycheck to paycheck. Over 70% couldn't come up with $1,000 for an emergency. Besides that, we all know their food is bad for your health.
0 ( +1 / -1 )
What if they speak Japanese? How do you tell them apart? It's like an Irish and an Englishman; an Indian or Pakistani; a Mexican or a El Salvadorian; a Nigerian or a black American; a Saudi Arabian or an Iranian, a Tongan or a Samoan? Funny thing, is that most race hate involves those we look like the most.
-2 ( +0 / -2 )
Inflation, was defined, as simply, "an increase in the money supply" by Webster's Dictionary, before the government changed the definition to, "an increase in consumer prices", as measured by the Consumer Price Index. Problem is, the CPI doesn't measure financial inflation: an increase in the price of stocks, bonds, and real estate in particular. Since the US dollar is the World's Reserve Currency, and is no longer backed by gold, there is no constraint on how much governments can print, and they can deceive the common person into thinking their currency is not sinking because they are all measured against each other. This has been going on for so long, that people can't see it without going back decades. The US is the largest debtor nation in the history of the world, and Japan has the highest debt to GDP ratio of any industrialized country in the world. When you have debt, you cannot pay back, the easiest way is to default is to print up your fiat currency ( paper backed by nothing) and tax your people through their loss of purchasing power. The propaganda machine of central banks and governments, is that inflation is good for the economy. See Argentina or Brazil to get a glimpse of what happens when governments want more inflation, but can't put the genie back in the bottle.
1 ( +2 / -1 )
Many US porn films have a little interview either before or after with the girls in which the girl explains that she willingly engaged in the activity and found it stimulating. Unfortunately, the interview could also have bee coerced. I guess the only solution, to keep everyone 100% safe, is to create another government agency. Yes, the Ministry of Porn is coming. These government employees would be there with tape recorders waiting for the word, " stop" or " don't" , so they could jump in and stop the film in a second. There would be a big studio where all porn would have to be filmed. The government could provide government made rubbers, and provide government made lubricants, so it would be "safe" for the poor abused Japanese women. The would have to mandate a porn minimum wage so the girls would be paid fairly. All scat films would be banned under the department of health if bacteria counts reached unacceptable levels.
-1 ( +1 / -2 )
If Trump becomes president, he's said he's going to make other countries pay 100% of the cost for America defending them against ? , whatever. The fact is, by the time Obama leaves office, the US will have over $20 trillion in funded, bonded debt, to other countries. But, wait, that's just the tip of the iceberg. There's over $100 trillion in unfunded debt liabilities that were promised to American citizens. Social security, Medicare, federal pensions, Fannie Mae, Student Loans, etc.. There's only two ways out: default or print more paper money. Politicians almost always go for the later if they can. Problem is, they've been doing it since 1971, and the world has more than enough US debt.
-2 ( +2 / -4 )
Abenomics, Quantitative Easing, or Whatever it takes, are all the same, from Japan, America, or Europe : The central bank buys more government bonds, drives interest rates lower, and increases the debt and money supply. Interest rates, the cost of capital, and thus the most important component of an economy, used to be set by the free market. This was the decision of millions voting with their dollars. Now we have central bankers, caught between a rock and a hard place. Can't raise rates because of too much government debt, and they've already reached zero so they have to go negative. The market solution will come when sovereign bond markets worldwide begin to implode.
-1 ( +0 / -1 )
There is no evidence that 2% inflation is the best amount for an economy to grow. If that were the case, wouldn't 4% be twice as good? The real reason why central banks tout inflation as the magical elixir is because they have so much debt, the only way to pay it, is to inflate it away. Problem is, if you're not getting a raise, you're purchasing power is constantly going down.
4 ( +7 / -3 )
A minuscule 25bps has caused the global markets to go down the most in history since January 1st. That's because the bubble is so big, it only takes a tiny pin.
-1 ( +0 / -1 )
Let's see : Turkey was fencing stolen oil from ISIS and Saudi Arabia has a competing oil pipeline to the Iran, Syrian Russian one, which, backed by the US, CIA trained rebels/terrorists, now ISIS, wants to overthrow Assad to perpetuate the Petro Dollar recycling system so that the world will always need dollars and the government can borrow in perpetuity.
3 ( +3 / -0 )
Not many people know that the only thing supporting the dollar, is the fact that OPEC agreed with the United States to sell oil only in US dollars. With over $17 trillion dollars held outside the US, and primarily held as reserves to buy oil from OPEC, it allowed the US to become the largest debtor nation in the world. After all, since 1971, when Nixon un pegged the dollar to gold, nothing backs the dollar, which was given the status of the world's reserve currency after WWII because the US agreed to back it up with gold at $35 an ounce. What does this have to do with Syria? Well, turns out that Russia, Syria, and Iran are building a huge oil pipeline that would sell oil to Western Europe, competing with a similar pipeline from a Saudi backed neighbor Kawate. The bottom line, is that when other countries, don't have to waste money hoarding dollars to buy oil, and they can buy it using their own currency, a flood of dollars will come back to the United States causing an inflationary collapse and a deflationary collapse in financial markets; specifically US Treasury bonds. So, the key for the US was to overthrow the Syrian government and install a puppet, like the Shaw of Iran. The CIA trained Al Qaeda rebels in Jordon to overthrow the democratically elected president of Syria. Problem is, he's one of Russia's closest allies, and they have a naval port and the gas pipeline investment they can't lose. Iran also has is Russia's ally for economic reasons. So when the Saudis , come in, backed by the US, to fight ISIS, notice how they only target the "bad terrorists. " The bad ones, just happen to be Syria's own government forces. That's why they don't want to let them in their country. This theatre of War has turned into a Kabuki play. Nothing is real. It's all about the money, as usual. The Petro Dollar is the last pillar of strength for this bankrupt country: The largest debtor nation in the history of the world. And that's not counting over $150 trillion in unfunded liabilities. Good luck getting social security.
3 ( +5 / -3 )
The good news is that we won't have to wait until 2020 before the global monetary system collapses. After defaulting on the Bretton Woods agreement in 1971, and severing any link between the World's Reserve Currency and gold, the dollar, which anchored all other currencies and thus limited debt government expansion to the amount of dollars in reserve, which was anchored by the amount of gold in reserve, served to constrain the belief that debt doesn't matter, and instead of letting the people vote on what to spend their money on, governments could indebt future generations simply by raising debt ceilings or borrowing more from their central bank. The global government debts, are being prevented from coming apart right now through trillions in derivative interest rate swaps. The cracks are widening as pending defaults in the oil sector, Greece, Puerto Rico, and the commodity sector have Deutsche Bank on the brink of bankruptcy, which will cause another Lehman event like in 2008, but on a global scale. When you have the Federal Reserve, sitting with $4.5 trillion on their balance sheet with only about $58 billion in capital, using mark to model accounting ( something you and I would go to jail for), picture an inverted pyramid about to tip over. Park cash into undervalued assets with no counter-party risk: like physical gold.
0 ( +0 / -0 )
Abewrongics isn't going to work anymore than America's version, called quantitative easing. This magical "inflation" the Keynesians keep pushing as the elixir for economic recessions, is now pushing over $200 trillion in worldwide sovereign debt. When you force interest rates negative, print more money, and devalue the currency, the income disparity between citizens grows exponentially because the groups like government and banking get the money first and the 90% of the people at the bottom don't see much of it if anything because their not getting better jobs, raises, and don't have their life savings in the stock market. The problem comes when defaults, cause defaults, which cause further defaults. A house of cards. Just like 2008, but bigger. Much, much bigger, because by printing more debt and spending more to solve the collapse of 2008, these central banks not only didn't solve the problem of too much debt and too much spending: they made it exponentially worse. Interest rates, the most important factor of an economy, which sets the price of capital and checks mal investment, needs to be set by the free market. Not a group of central bankers who think they are dialing a thermostat up or down. What they're playing with is a nuclear reactor.
5 ( +5 / -0 )
Shortly after the Federal Reserve raised interest rates 25bps on December 16, 2015 global markets have had an historic drop since the beginning of the year. Interest rates are perhaps the most important function of an economy. Instead of letting the free market decide the price of money, we've had global central bank pegs, through debt monetization, artificially pegging them at 0%, or in the case of Japan, Germany, and Switzerland, a negative percentage in he hopes of greater economic growth. The reality, for the US in particular, is that with over $19 trillion in funded debt, and over $110 trillion in unfunded liabilities, the government is broke. Rather than tell its creditors, you're only going to get .01 on the dollar, they've made up this meme that inflation equals economic growth, so they can print more money through the central bank. The creditor gets paid back, with currency that is worthless. It may seem that the Yen is getting stronger compared to the dollar, or the Euro, because they are only measured against each other. it's as if they all jumped out of the plane together. They're all falling, just at different rates. Everyone is losing purchasing power. The only form of currency which has lasted over 5,000 years is gold. That's what you need to measure you're currency against. A form of money that can't be printed out of thin air, has no counter party risk, has intrinsic value, and is accepted world wide.
3 ( +3 / -0 )
I wonder if Japan's tax code is like the IRS? You're guilty until proven innocent. Taxes will only increase because government debt is increasing at an historical pace.
0 ( +0 / -0 )
The stock market might stay elevated if they can manage negive interest rates worldwide, and pretend that everything is just fine while the world enters a world wide depression as evidenced by the Baltic Dry Indext and dropping oil prices. Problem is, whatever fiat currency you have, will be worth less everyday as measured against the oldest, most honest currency in the history of man kind for over 5,000 years: GOLD
-1 ( +1 / -2 )
From omnipotent to impotent, the negative interest rate policy back fired as the Nikkei 225 dropped off the cliff yesterday. It's the pinacle of Keynesian debauchery to think you'll be a wealthier nation by printing more money. All you do is rob your citizens of purchasing power, but enrich the 1% who get their hands on the money first.
1 ( +1 / -0 )
Here in Hawaii, we have thousands of Korean Bars that are begging for Japanese to spend there money and buy them a drinkie. Maybe they developed this skill during the war?
-15 ( +3 / -18 )