China cuts interest rates again to spur economic growth

[Publicus]

Rumor has it when Xi arrives in Washington next week Obama will declare him a refugee.

An economically displaced person.

Send him to a relief camp in Utah. Get assigned building a new railroad connection to a new airport.

[Naam]

does the President of the United States and Leader of the Free World (copyright FAUX News) need any leverage over a head of state? isn't it a fact that if Obama says "jump" Xi will answer "how high Bwana Barack"?

[Publicus]

does the President of the United States and Leader of the Free World (copyright FAUX News) need any leverage over a head of state? isn't it a fact that if Obama says "jump" Xi will answer "how high Bwana Barack"?

The post does speak in the direction of the central point.

It goes without saying that Xi Jinping and the CCP Boyz in Beijing, as well as the people of the CCP China, know the USA will come riding to the rescue of the economy and social stability and peace. The Chinese people want peace and development, prosperity.

The US reconstructed Japan and South Korea and the Chinese people are well aware of it. USA also sponsors successful Taiwan, is a model for success in Singapore, supports prosperous and free Hong Kong vs Beijing. In a stark contrast, the CCP Boyz single project in the region is North Korea. The Chinese people know this and more as they shake their heads.

I reiterate with more than tongue in cheek what I've been noting throughout the thread, which is that the CCP Boyz next five-year plan will in various ways come from the US Treasury Dept, the Fed, IMF. (The next five-year plan is due in mid 2017 but could occur sooner.)

Putin is completely the opposite. Putin not only spits in your eye, he makes it a point to spit as often and as much as possible. What Putin really wants to do is blind you so he can kick where it hurts most, then pull out his heavy duty Russian scissors. The guy is vile. Which is why he and Russia are going down with a lot of help from the Nato countries. Russians themselves want to tell the world how much grief and hardship they can bear and be proud of it.

China goes down and gets a helping hand. Putin and Russia go down as they get a final swift kick.

[Harsh Jones]

does the President of the United States and Leader of the Free World (copyright FAUX News) need any leverage over a head of state? isn't it a fact that if Obama says "jump" Xi will answer "how high Bwana Barack"?

The post does speak in the direction of the central point.

It goes without saying that Xi Jinping and the CCP Boyz in Beijing, as well as the people of the CCP China, know the USA will come riding to the rescue of the economy and social stability and peace. The Chinese people want peace and development, prosperity.

The US reconstructed Japan and South Korea and the Chinese people are well aware of it. USA also sponsors successful Taiwan, is a model for success in Singapore, supports prosperous and free Hong Kong vs Beijing. In a stark contrast, the CCP Boyz single project in the region is North Korea. The Chinese people know this and more as they shake their heads.

I reiterate with more than tongue in cheek what I've been noting throughout the thread, which is that the CCP Boyz next five-year plan will in various ways come from the US Treasury Dept, the Fed, IMF. (The next five-year plan is due in mid 2017 but could occur sooner.)

Putin is completely the opposite. Putin not only spits in your eye, he makes it a point to spit as often and as much as possible. What Putin really wants to do is blind you so he can kick where it hurts most, then pull out his heavy duty Russian scissors. The guy is vile. Which is why he and Russia are going down with a lot of help from the Nato countries. Russians themselves want to tell the world how much grief and hardship they can bear and be proud of it.

China goes down and gets a helping hand. Putin and Russia go down as they get a final swift kick.

You still dont seem to understand what is at play here. The debtor in this situation is not in the position of strength. How well did this work in 2008 for Wall Street and the Fed. In case you missed it, Fanny and Freddie did go under and were bailed out.

Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814

Jan. 29 (Bloomberg) -- Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said.

Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”

I wonder if Russia will give a goodwill warning to China this time, when it comes to treasury debt , as they did with the GSE debt.

Edited September 11, 2015 by Harsh Jones

[Publicus]

does the President of the United States and Leader of the Free World (copyright FAUX News) need any leverage over a head of state? isn't it a fact that if Obama says "jump" Xi will answer "how high Bwana Barack"?

The post does speak in the direction of the central point.

It goes without saying that Xi Jinping and the CCP Boyz in Beijing, as well as the people of the CCP China, know the USA will come riding to the rescue of the economy and social stability and peace. The Chinese people want peace and development, prosperity.

The US reconstructed Japan and South Korea and the Chinese people are well aware of it. USA also sponsors successful Taiwan, is a model for success in Singapore, supports prosperous and free Hong Kong vs Beijing. In a stark contrast, the CCP Boyz single project in the region is North Korea. The Chinese people know this and more as they shake their heads.

I reiterate with more than tongue in cheek what I've been noting throughout the thread, which is that the CCP Boyz next five-year plan will in various ways come from the US Treasury Dept, the Fed, IMF. (The next five-year plan is due in mid 2017 but could occur sooner.)

Putin is completely the opposite. Putin not only spits in your eye, he makes it a point to spit as often and as much as possible. What Putin really wants to do is blind you so he can kick where it hurts most, then pull out his heavy duty Russian scissors. The guy is vile. Which is why he and Russia are going down with a lot of help from the Nato countries. Russians themselves want to tell the world how much grief and hardship they can bear and be proud of it.

China goes down and gets a helping hand. Putin and Russia go down as they get a final swift kick.

You still dont seem to understand what is at play here. The debtor in this situation is not in the position of strength. How well did this work in 2008 for Wall Street and the Fed. In case you missed it, Fanny and Freddie did go under and were bailed out.

Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814

Jan. 29 (Bloomberg) -- Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said.

Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”

I wonder if Russia will give a goodwill warning to China this time, when it comes to treasury debt , as they did with the GSE debt.

Re-read the post you quoted. My post you quoted sums up the situation presented in your post and the attitude respectively of the Russians and the Chinese that I had pointed out. Putin pulled out his Russian scissors but the Boyz threw a net over him.

The news report was made in 2008 so it's been known since then, although it is understood to use it now to make your point. Your point is of course that the crashes and collapsing in the CCP China and the endless downward spiral in Russia will produce the downfall of the United States and its destruction, i.e., monetarism, after which true 19th century gold standard based capitalism will be possible led by the CCP China and Putin's Russia.

Your posts say Russia and China will destroy the United States to save the world from the evil empire of the United States.

[NeverSure]

Because the Balance of Payment accounts are based on double-entry bookkeeping, the annual current account and capital account have to net to zero, so that any current account deficit is offset one-to-one by a capital account surplus (deficit) and the balance of payments therefore always nets out to (equals) zero. And that's why it's called the "balance" of payments, because once we account for trade flows and capital flows, everything balances, and there are no deficits or surpluses on a net basis.

The way the US sells Treasuries to China means the US has a "capital account surplus." And China has a "capital account deficit." You see, when the US ships currency to China in exchange for real stuff, that's a deficit for the US. But when China ships currency to the US in exchange for Treasury bonds, that's a deficit for China.

Class dismissed

Now let's hold that class, because you don't understand a damn thing about double entry bank bookkeeping while I was a bank auditor.

You have it all wrong because bank accounting is the inverse of our accounting. It's a mirror image and it is confusing at first. You have to learn to breath it because at first it doesn't make sense, even to an accountant.

For instance, if you or I have cash on hand it's an asset and it's a liquid asset at that. But the cash the bank has in its vault is a liability because it is a debt - money held for and owed to depositors. The more cash a bank has on hand the deeper in debt it is for that cash. It belongs to depositors and is owed.

If you or I have a bank loan it is a liability because it is owed to the bank. That same loan and all such loans on the bank's books are bank assets because they are owed to the bank. They are like accounts receivable to the bank.

Now walk into a bank on your first day and try to post the general ledger and you will fail. You will be asking "Is this a debit or a credit" for the entries because it's hard to figure out until you "own" the concept. If I put through a debit to suspense and offset it (double entry) with a credit to cash to balance cash overnight until we can fix it, did I raise or lower the bank's assets or liabilities? What does a credit to cash mean?

Well anywhere else a credit to cash would raise the cash total on the books and increase assets. But in this case since cash is a liability (red ink literally) crediting it with a black credit will lower the amount of the (red, liability) cash and the bank will have a lower total of liabilities - cash.

Now please go play with the other boys, will you?

Cheers.

yes yes.. All of the money the Fed printed in QE 1,2,3 and the next QE is the Feds liability. That.... is... a problem.

Dumb. The Fed has never printed money. That's not its domain. Only the ignorant that listen to the ignorant continually parrot that line.

There aren't more USD in existence in the world than there were before QE other than that needed to meet global expansion.

The ignorant believe that QE somehow dilutes the USD because they have no concept of what "increasing the money supply" means. The money supply to the economy is increased by increasing the percentage of depositors' money that banks may loan. This is augmented by lowing interest rates at the overnight window to encourage lending by banks.

The money supply is the amount of money available to the economy to get it rolling and keep it rolling. Banks have that money already but their reserve requirements fluctuate by Fed requirements either loosening or tightening how much they can make available into the economy. That's it and that's all of it.

The Fed can pull that money back in - reducing the money supply by tightening reserve requirements and that's it and that's it and that's all of it.

You are never going to understand this and I don't know why I waste my time. I explain something and you just change the subject to some more of your uninformed comments.

[NeverSure]

almost no one except the countries mentioned above with whom China has signed swap agreements and the dozen countries which will sign very soon these kind of agreements to bypass the Dollar. none of your diversional yada yada can't change that fact.

talking about shit... just look at your various ridiculous postings crowned by "only the US-Dollar is the international unit of trade" and recognise shit²

disclaimer: i too am convinced that the US-Dollar will remain for years to come not only the reserve currency but also the dominant reference currency used in bilateral trade. but that does not mean that bilateral trade can't be carried without the slightest involvement of USD.

even totally macroeconomic ignorants will realise that when looking at trades between countries which have adopted the €UR. exceptions are eggsburts such as Bill from Boise, Idaho; Buck from Duluth, Minnesota; Hank from Little Rock, Arkansas and Bubba (aka Joe) from Quails Hollow, Oregon just prove the rule

You're out of your league here Naam. Your field is obviously not banking.

Cheers.

[Harsh Jones]

Because the Balance of Payment accounts are based on double-entry bookkeeping, the annual current account and capital account have to net to zero, so that any current account deficit is offset one-to-one by a capital account surplus (deficit) and the balance of payments therefore always nets out to (equals) zero. And that's why it's called the "balance" of payments, because once we account for trade flows and capital flows, everything balances, and there are no deficits or surpluses on a net basis.

The way the US sells Treasuries to China means the US has a "capital account surplus." And China has a "capital account deficit." You see, when the US ships currency to China in exchange for real stuff, that's a deficit for the US. But when China ships currency to the US in exchange for Treasury bonds, that's a deficit for China.

Class dismissed

Now let's hold that class, because you don't understand a damn thing about double entry bank bookkeeping while I was a bank auditor.

You have it all wrong because bank accounting is the inverse of our accounting. It's a mirror image and it is confusing at first. You have to learn to breath it because at first it doesn't make sense, even to an accountant.

For instance, if you or I have cash on hand it's an asset and it's a liquid asset at that. But the cash the bank has in its vault is a liability because it is a debt - money held for and owed to depositors. The more cash a bank has on hand the deeper in debt it is for that cash. It belongs to depositors and is owed.

If you or I have a bank loan it is a liability because it is owed to the bank. That same loan and all such loans on the bank's books are bank assets because they are owed to the bank. They are like accounts receivable to the bank.

Now walk into a bank on your first day and try to post the general ledger and you will fail. You will be asking "Is this a debit or a credit" for the entries because it's hard to figure out until you "own" the concept. If I put through a debit to suspense and offset it (double entry) with a credit to cash to balance cash overnight until we can fix it, did I raise or lower the bank's assets or liabilities? What does a credit to cash mean?

Well anywhere else a credit to cash would raise the cash total on the books and increase assets. But in this case since cash is a liability (red ink literally) crediting it with a black credit will lower the amount of the (red, liability) cash and the bank will have a lower total of liabilities - cash.

Now please go play with the other boys, will you?

Cheers.

yes yes.. All of the money the Fed printed in QE 1,2,3 and the next QE is the Feds liability. That.... is... a problem.

Dumb. The Fed has never printed money. That's not its domain. Only the ignorant that listen to the ignorant continually parrot that line.

There aren't more USD in existence in the world than there were before QE other than that needed to meet global expansion.

The ignorant believe that QE somehow dilutes the USD because they have no concept of what "increasing the money supply" means. The money supply to the economy is increased by increasing the percentage of depositors' money that banks may loan. This is augmented by lowing interest rates at the overnight window to encourage lending by banks.

The money supply is the amount of money available to the economy to get it rolling and keep it rolling. Banks have that money already but their reserve requirements fluctuate by Fed requirements either loosening or tightening how much they can make available into the economy. That's it and that's all of it.

The Fed can pull that money back in - reducing the money supply by tightening reserve requirements and that's it and that's it and that's all of it.

You are never going to understand this and I don't know why I waste my time. I explain something and you just change the subject to some more of your uninformed comments.

The Fed conjures money on its computer , marking up accounts with dealer banks. (This does lead to more base money which does lead to more paper bank notes.)

Lets ask Ben Bernanke the question... You call yourself a banker and claim to be in touch with whats going on but you missed this ?

https://www.youtube.com/watch?v=6hnG_iWAauY

From the video I quote "It is much more akin to money printing then borrowing"

Look at this chart. Assets eh... where did the Fed get the money to buy these "assets" ? Does it have iPhone factories like China does ?

[Harsh Jones]

does the President of the United States and Leader of the Free World (copyright FAUX News) need any leverage over a head of state? isn't it a fact that if Obama says "jump" Xi will answer "how high Bwana Barack"?

The post does speak in the direction of the central point.

It goes without saying that Xi Jinping and the CCP Boyz in Beijing, as well as the people of the CCP China, know the USA will come riding to the rescue of the economy and social stability and peace. The Chinese people want peace and development, prosperity.

The US reconstructed Japan and South Korea and the Chinese people are well aware of it. USA also sponsors successful Taiwan, is a model for success in Singapore, supports prosperous and free Hong Kong vs Beijing. In a stark contrast, the CCP Boyz single project in the region is North Korea. The Chinese people know this and more as they shake their heads.

I reiterate with more than tongue in cheek what I've been noting throughout the thread, which is that the CCP Boyz next five-year plan will in various ways come from the US Treasury Dept, the Fed, IMF. (The next five-year plan is due in mid 2017 but could occur sooner.)

Putin is completely the opposite. Putin not only spits in your eye, he makes it a point to spit as often and as much as possible. What Putin really wants to do is blind you so he can kick where it hurts most, then pull out his heavy duty Russian scissors. The guy is vile. Which is why he and Russia are going down with a lot of help from the Nato countries. Russians themselves want to tell the world how much grief and hardship they can bear and be proud of it.

China goes down and gets a helping hand. Putin and Russia go down as they get a final swift kick.

You still dont seem to understand what is at play here. The debtor in this situation is not in the position of strength. How well did this work in 2008 for Wall Street and the Fed. In case you missed it, Fanny and Freddie did go under and were bailed out.

Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814

Jan. 29 (Bloomberg) -- Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said.

Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”

I wonder if Russia will give a goodwill warning to China this time, when it comes to treasury debt , as they did with the GSE debt.

Re-read the post you quoted. My post you quoted sums up the situation presented in your post and the attitude respectively of the Russians and the Chinese that I had pointed out. Putin pulled out his Russian scissors but the Boyz threw a net over him.

The news report was made in 2008 so it's been known since then, although it is understood to use it now to make your point. Your point is of course that the crashes and collapsing in the CCP China and the endless downward spiral in Russia will produce the downfall of the United States and its destruction, i.e., monetarism, after which true 19th century gold standard based capitalism will be possible led by the CCP China and Putin's Russia.

Your posts say Russia and China will destroy the United States to save the world from the evil empire of the United States.

My point was to you that the DEBTOR is not in the position of strength in these situations. The US and Wall Street was the debtor and China and Russia were the creditors in the mortgage backed security market and look what happened. Did Wall street "call in" their debt paper ? No. Wall Street fell flat on its face because of Chinese and Russian actions.

[Publicus]

The smokescreen put up by the G-20 last week has cleared to expose the CCP China economy as being as dead in the water as Titanic had been before she plunged down into the deep.

The G-20 public statements were that there's nothing to worry too much about really and that the Boyz can pull things back together. Now come the reports from the actual events and developments of the meeting of finance ministers, central bankers, major banking and investment houses.


China just gave the game away


Chinese leaders expressed deep concern for their country's economy last weekend at a meeting of G-20 nations in Ankara, Turkey.

That is weird for two reasons.

First, China's leaders are normally incredibly confident about their economy in public.

Second, amid the worry — despite the Chinese economy's visible slowdown and dramatic action over the past month — officials maintained that the economy would continue to grow at 7% annually.

Basically, that means Chinese officials just gave the game away: They expect us to believe that the country's economy will close this year growing the same way it did last year: 7%, always 7%.

Something here doesn't fit.

http://www.businessinsider.com/china-leaders-show-concern-at-g20-2015-9

There is almost no way that China's economy is growing as well as the government says it is.

For years, experts have questioned whether China cooks its books.

"The question is not whether they're right, it's how wrong are they," says Derek Scissors, an Asia expert at the American Enterprise Institute.

But you don't need a PhD in statistics to figure it out this time.

Just take a look at what China's government has been doing lately: making a surprise devaluation of the yuan in an effort to boost exports, propping up its markets by actually buying stocks, spending big and cutting interest rates in an effort to stimulate its economy.

China wouldn't be taking these actions if the country really was chugging along at the 7% growth rate that the latest government data claims.

"China could be in the world's greatest depression and they would still report 7%," says Gordon Chang, a China expert and author of "The Coming Collapse of China." Dr. Chang says his sources have the year's growth rate at 2.2% unless things turn worse than they already are.

http://money.cnn.com/2015/08/21/news/economy/china-economy-slowdown/

And we have this from China expert John Mauldin, author of A Great Leap Forward?

We Don’t Know Whom to Trust in China.

Until 2–3 months ago, most China watchers believed that the country’s leaders had a thoughtful, comprehensive economic plan. I don’t know many people who think so anymore.

So when I say that China’s leadership has no experience in dealing with a modern economy, I mean it in that context. They’ve done a heck of a job for the last 35 years, especially given where they started. What they have done is unprecedented. So hats off. But just as we keep reminding investors that past performance is not indicative of future results, so should we be skeptical about the future quality of government decisions. And frankly, I did not expect the truth of that assertion to become apparent so quickly and so blatantly in China.

If the leadership did have a plan going into the stock market tumble, it must have gone out the window. The on-again, off-again interventions and conflicting statements could not have been part of any rational plan, unless the plan was to confuse everyone. They succeeded, if that was the case. They are clearly making up their game plan in the middle of the game.

In the space of about two months, Beijing reversed years of statements that had almost convinced the world that China really believes in market discipline. That PR campaign is now in shambles. The best-case interpretation is that the leadership is in disarray amid Xi Jinping’s corruption crackdown and unable to coordinate its messaging and intervention strategies – which is obviously not good, either.

Many people thought that at least the central bankers at the PBOC were competent and as immune from political interference as it is possible to be in China. No more. The PBOC may well have tried to assert its independence; but if it did, it failed.

The Chinese government is once again a “black box,” at least in terms of its economic policy. We don’t know who is making the decisions, nor can we be sure what they want to accomplish.

Just a few weeks ago, we all thought China wanted to float the renminbi so it could go in the IMF’s reserve currency basket. The IMF has bent over backwards trying to help China do this, even extending the review period by a year so China would have more set-up time. Beijing is not taking the hints. Either they have abandoned that goal or they don’t understand what they need to do to accomplish it.

http://www.businessinsider.com/dont-confuse-chinese-stocks-for-economy-2015-9?

[NeverSure]

The Fed conjures money on its computer , marking up accounts with dealer banks. (This does lead to more base money which does lead to more paper bank notes.)

Lets ask Ben Bernanke the question... You call yourself a banker and claim to be in touch with whats going on but you missed this ?

Son, you just keep saying and showing things you don't understand.

Here is the Fed's own website (St. Louis Branch) showing how much currency is printed and in circulation in the whole world. It's only about 1.3 trillion USD to supply all worldwide needs for USD currency.

But you say in regard to your charts that "this does lead to more paper bank notes."

No it doesn't and no it hasn't.

There is no hope for you because you believe you already know it all. You aren't worth the trouble or I'd teach you how this works. You can't learn because you won't listen.

Cheers.

[NeverSure]

Look at this chart. Assets eh... where did the Fed get the money to buy these "assets" ? Does it have iPhone factories like China does ?

Wow. Let's get some theory and some terms straight.

The US debt has increased from just over $10 tril when Obama took office in 2008 to about $18 tril today. That increase in debt is where the Fed gets money!!!

Unlike some countries such as the UK and broader, the EU, the US Fed is prohibited by law from buying newly issue US treasuries. The money has to be truly borrowed. When the US needs more money it has borrowed it, increasing the debt which does not equal printing money or increasing the money supply or printing currency.

There's your answer. It was borrowed.

There is some affect from "Fractional Reserve Banking" but that can be brought back in by an overnight change in regulations when the Fed increases bank reserve requirements in the US.

So, your homework:

Define fractional reserve banking.

Define "the money supply" as opposed to also defining "the currency supply". Study printing and coining of currency as opposed to increasing the money supply - M1, M2, M3, etc. Be sure you understand the difference between "money" and "currency" because it's obvious you don't.

Learn how the end of the QE's will decrease the money supply, just as QE's increased the money supply (but not the total amount of money - just the amount of existing money that is available to the general economy).

Never in my life have I ever run across anyone who, while so wrong about so much, was so arrogant in his ignorance as you are.

Apologies to Ronald Reagan, but "It isn't so much that you are ignorant. It's just that you know so many things that aren't so."

[Harsh Jones]

The Fed conjures money on its computer , marking up accounts with dealer banks. (This does lead to more base money which does lead to more paper bank notes.)

Lets ask Ben Bernanke the question... You call yourself a banker and claim to be in touch with whats going on but you missed this ?

Son, you just keep saying and showing things you don't understand.

Here is the Fed's own website (St. Louis Branch) showing how much currency is printed and in circulation in the whole world. It's only about 1.3 trillion USD to supply all worldwide needs for USD currency.

But you say in regard to your charts that "this does lead to more paper bank notes."

No it doesn't and no it hasn't.

There is no hope for you because you believe you already know it all. You aren't worth the trouble or I'd teach you how this works. You can't learn because you won't listen.

Cheers.

There somebody that doesn't understand, and its not me. This is the leakage from QE in the chart. It is not a coincidence that it started rising about when the Bush stimulus checks came out, Tarp, Obama stimulus and all of the QE's.

DEFINITION of 'M1'

A measure of the money supply that includes all physical money, such as coins and currency, as well as demand deposits, checking accounts and Negotiable Order of Withdrawal (NOW) accounts. M1 measures the most liquid components of the money supply, as it contains cash and assets that can quickly be converted to currency. It does not contain "near money" or "near, near money" as M2 and M3 do.

[Harsh Jones]

Look at this chart. Assets eh... where did the Fed get the money to buy these "assets" ? Does it have iPhone factories like China does ?

Wow. Let's get some theory and some terms straight.

The US debt has increased from just over $10 tril when Obama took office in 2008 to about $18 tril today. That increase in debt is where the Fed gets money!!!

Unlike some countries such as the UK and broader, the EU, the US Fed is prohibited by law from buying newly issue US treasuries. The money has to be truly borrowed. When the US needs more money it has borrowed it, increasing the debt which does not equal printing money or increasing the money supply or printing currency.

There's your answer. It was borrowed.

There is some affect from "Fractional Reserve Banking" but that can be brought back in by an overnight change in regulations when the Fed increases bank reserve requirements in the US.

So, your homework:

Define fractional reserve banking.

Define "the money supply" as opposed to also defining "the currency supply". Study printing and coining of currency as opposed to increasing the money supply - M1, M2, M3, etc. Be sure you understand the difference between "money" and "currency" because it's obvious you don't.

Learn how the end of the QE's will decrease the money supply, just as QE's increased the money supply (but not the total amount of money - just the amount of existing money that is available to the general economy).

Never in my life have I ever run across anyone who, while so wrong about so much, was so arrogant in his ignorance as you are.

Apologies to Ronald Reagan, but "It isn't so much that you are ignorant. It's just that you know so many things that aren't so."

Here is the text of the interview from Fed chair Ben Bernanke that you didn't watch that I provided in my post. I know you are from the school that thinks there is some black magic in central bank balance sheet expansion.(since you like hiding behind technicalities) You are also from the school that thinks economics is an exact science. But you probably don't even realize this because you don't understand that economics is subjective.

Bernanke: "To lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed, so it's much more akin, although not exactly the same, it's much more akin to printing money than it is to borrowing."

Interviewer: "You've been printing money then?"

Bernanke: "Well... effectively and we need to do that"

Edited September 14, 2015 by Harsh Jones

[NeverSure]

The Fed conjures money on its computer , marking up accounts with dealer banks. (This does lead to more base money which does lead to more paper bank notes.)

Lets ask Ben Bernanke the question... You call yourself a banker and claim to be in touch with whats going on but you missed this ?

Son, you just keep saying and showing things you don't understand.

Here is the Fed's own website (St. Louis Branch) showing how much currency is printed and in circulation in the whole world. It's only about 1.3 trillion USD to supply all worldwide needs for USD currency.

But you say in regard to your charts that "this does lead to more paper bank notes."

No it doesn't and no it hasn't.

There is no hope for you because you believe you already know it all. You aren't worth the trouble or I'd teach you how this works. You can't learn because you won't listen.

Cheers.

DEFINITION of 'M1'

A measure of the money supply that includes all physical money, such as coins and currency, as well as demand deposits, checking accounts and Negotiable Order of Withdrawal (NOW) accounts. M1 measures the most liquid components of the money supply, as it contains cash and assets that can quickly be converted to currency. It does not contain "near money" or "near, near money" as M2 and M3 do.

You are underlining the tiny part - physical currency, and glossing over the large part which is the deposit accounts and other components of M1...

There is only about $1.3 trillion in US currency in the world while M1 is around $3,000 billion. LINK

[NeverSure]

Here is the text of the interview from Fed chair Ben Bernanke that you didn't watch that I provided in my post. I know you are from the school that thinks there is some black magic in central bank balance sheet expansion.(since you like hiding behind technicalities) You are also from the school that thinks economics is an exact science. But you probably don't even realize this because you don't understand that economics is subjective.

Bernanke: "To lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed, so it's much more akin, although not exactly the same, it's much more akin to printing money than it is to borrowing."

Interviewer: "You've been printing money then?"

Bernanke: "Well... effectively and we need to do that"

This is because the interviewer and Bernanke knew what they meant and you don't.

I have said the the Fed can increase the money supply with anything similar to QE, but that when they reverse QE later (increase banks' reserve requirements and raise interest rates) that increase of the money supply will unwind and the money supply will decrease. In the meantime no real additional USD were created for the long term. It's a paper shuffle which can go either way.

You simply can't track the difference between the total amount of USD in the world and the "money supply". End of.

[Publicus]

Japanese Researchers Think China’s GDP Could Crash to Minus 20 Percent in Next 5 Years

Uh, yeah, that is the headline and you and I did read it correctly. Minus 20% GDP growth in the CCP China and what's not in the headline is that they're talking 2017-2018.

Daiwa Institute of Research in Japan is consistent with many other global marketmakers that the present GDP claims out of Beijing of 7% growth are robotics or are simply blue smoke and mirrors. Others say the actual growth this year will be no better than 4%, others say no better than 3%, while yet others see growth at 2.2% with a distinct possibility of zero growth or worse.

Daiwa which is the second largest securities firm in Japan simply takes the data forward and more comprehensively to find a major collapse occurring now and going forward. It's a big economy and even it takes some time to fall apart, but 2017-2018 now appears not off the mark. (Nomura is the largest securities and financial firm in Japan and was the first to call the bursting of the housing and property bubble, forecasting two years ago a "major downward adjustment" of the Chinese economy: c-r-a-s-h.)

The report supports the current narrative that China has channeled too much money into infrastructure spending, much of which is not generating the required return.

“It is not an overstatement to point out that this is of the utmost concern for those involved in the global financial markets,” it states in the report.

And while the analysts give the regime in China some leeway to manage an economic downswing, the large number of bad loans from bad investments in the system eventually will be too much to handle. “China is still likely to be faced with the threat of a financial collapse,” states the report, "even if the central government intervenes."

http://www.tradingeconomics.com/china/producer-prices

Statue of Chairman Mao Zedong sillouetted in smog outside stock exchange in Shanghai.

China stocks lost all their gains of this year in the market crash of the summer.

According to Daiwa, this waste of resources and inefficiency in the use of capital and labor will lead to a massive adjustment—downward. In the best case scenario, this means 4 percent growth for capital spending (rather than 10–20 percent in the last decade) and zero percent GDP growth. However, this is not the most likely scenario.

“Of all the possible risk scenarios the meltdown scenario is, realistically speaking, the most likely to occur,” the reports states without sugarcoating.

Even though the researchers didn’t want to put it into words, the minus 20 percent growth at around 2017–2018 is clearly represented by the green charts in the lower right diagram of the following chart series.

Daiwa’s calculations for future Chinese growth rates. (Daiwa Institute of Research)

Xi's vision of a "community of common destiny" sees Chinese economic prosperity enriching surrounding nations as well, earning China the world's respect and helping fulfill what Xi calls the "Chinese dream."

Whether that dream is fulfilled or goes sour, China shoulders a greater responsibility for global events than perhaps at any time in its history. Xi talks a lot about a "new normal." This is it.

http://asia.nikkei.com/magazine/20150827-THE-GREAT-FALL/On-the-Cover/China-is-brewing-a-global-economic-storm?page=2

Edited September 14, 2015 by Publicus

[ExpatOilWorker]

Here is the text of the interview from Fed chair Ben Bernanke that you didn't watch that I provided in my post. I know you are from the school that thinks there is some black magic in central bank balance sheet expansion.(since you like hiding behind technicalities) You are also from the school that thinks economics is an exact science. But you probably don't even realize this because you don't understand that economics is subjective.

Bernanke: "To lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed, so it's much more akin, although not exactly the same, it's much more akin to printing money than it is to borrowing."

Interviewer: "You've been printing money then?"

Bernanke: "Well... effectively and we need to do that"

This is because the interviewer and Bernanke knew what they meant and you don't.

I have said the the Fed can increase the money supply with anything similar to QE, but that when they reverse QE later (increase banks' reserve requirements and raise interest rates) that increase of the money supply will unwind and the money supply will decrease. In the meantime no real additional USD were created for the long term. It's a paper shuffle which can go either way.

You simply can't track the difference between the total amount of USD in the world and the "money supply". End of.

For comparison reasons, do you know what M1 and money supply is for China and how much it has changed sine 2008?

[Harsh Jones]

Here is the text of the interview from Fed chair Ben Bernanke that you didn't watch that I provided in my post. I know you are from the school that thinks there is some black magic in central bank balance sheet expansion.(since you like hiding behind technicalities) You are also from the school that thinks economics is an exact science. But you probably don't even realize this because you don't understand that economics is subjective.

Bernanke: "To lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed, so it's much more akin, although not exactly the same, it's much more akin to printing money than it is to borrowing."

Interviewer: "You've been printing money then?"

Bernanke: "Well... effectively and we need to do that"

This is because the interviewer and Bernanke knew what they meant and you don't.

I have said the the Fed can increase the money supply with anything similar to QE, but that when they reverse QE later (increase banks' reserve requirements and raise interest rates) that increase of the money supply will unwind and the money supply will decrease. In the meantime no real additional USD were created for the long term. It's a paper shuffle which can go either way.

You simply can't track the difference between the total amount of USD in the world and the "money supply". End of.

You thought by getting into the technical aspects of central bank balance sheet expansion (metaphorically known as money printing) that you could confuse enough ppl to make you look smart. Fail.

I have said the the Fed can increase the money supply with anything similar to QE, but that when they reverse QE later (increase banks' reserve requirements and raise interest rates) that increase of the money supply will unwind and the money supply will decrease

You can't just make a statement that has no place in realty and expect to get away with it because it says so in a Keynesian text book.

The act of the Fed reversing QE means that they will be selling the bonds that they purchased (via balance sheet expansion aka money printing) on the open market and taking the dollars back (yes,its liabilities)

So who is going to buy this debt on the open market ? China ? Nope they are selling. Gulf states ? No they stopped buying and are feeling the oil squeeze. American citizens ? With a savings rate that never gets close to double digits , no. And not if the "American consumer" is the focal point of the US keynesian economy. They have to borrow and spend, so that China can lend and produce. High interest rates and a Fed who is selling rather then buying, turns this whole dynamic on its head. Hence why they have been hood winking ppl like you and Pubicious into saying that they will raise rates, when they won't because they cant if they want to prop up this version of the economy.

[NeverSure]

One more time. Bernanke didn't say they print money and he didn't say they cause more $USD to come into existence. No he didn't. For those who can understand what he meant, the Fed has been "increasing the (percentage of existing USD) money supply that is available to the general economy.

Ending QE will be raising interest rates to discourage borrowing and tightening bank lending requirements. Banks will be required to lend a smaller percentage of depositors' money.

That will decrease the money supply that is available to the general economy.

It won't affect the amount of USD there is in existence, but rather affect the amount that is available to the economy. The supply of money will decrease without affecting the total amt. of USD in the world.

[ExpatOilWorker]

Here is the text of the interview from Fed chair Ben Bernanke that you didn't watch that I provided in my post. I know you are from the school that thinks there is some black magic in central bank balance sheet expansion.(since you like hiding behind technicalities) You are also from the school that thinks economics is an exact science. But you probably don't even realize this because you don't understand that economics is subjective.

Bernanke: "To lend to a bank we simply use the computer to mark up the size of the account that they have with the Fed, so it's much more akin, although not exactly the same, it's much more akin to printing money than it is to borrowing."

Interviewer: "You've been printing money then?"

Bernanke: "Well... effectively and we need to do that"

This is because the interviewer and Bernanke knew what they meant and you don't.

I have said the the Fed can increase the money supply with anything similar to QE, but that when they reverse QE later (increase banks' reserve requirements and raise interest rates) that increase of the money supply will unwind and the money supply will decrease. In the meantime no real additional USD were created for the long term. It's a paper shuffle which can go either way.

You simply can't track the difference between the total amount of USD in the world and the "money supply". End of.

For comparison reasons, do you know what M1 and money supply is for China and how much it has changed sine 2008?

From the look of the below graph, the Chinese M1 is now bigger than USA's and it has really accelerated upwards since 2005. The redback is doomed.

[Publicus]

<<snip>>

It goes without saying that Xi Jinping and the CCP Boyz in Beijing, as well as the people of the CCP China, know the USA will come riding to the rescue of the economy and social stability and peace. The Chinese people want peace and development, prosperity.

The US reconstructed Japan and South Korea and the Chinese people are well aware of it. USA also sponsors successful Taiwan, is a model for success in Singapore, supports prosperous and free Hong Kong vs Beijing. In a stark contrast, the CCP Boyz single project in the region is North Korea. The Chinese people know this and more as they shake their heads.

I reiterate with more than tongue in cheek what I've been noting throughout the thread, which is that the CCP Boyz next five-year plan will in various ways come from the US Treasury Dept, the Fed, IMF. (The next five-year plan is due in mid 2017 but could occur sooner.)

Putin is completely the opposite. Putin not only spits in your eye, he makes it a point to spit as often and as much as possible. What Putin really wants to do is blind you so he can kick where it hurts most, then pull out his heavy duty Russian scissors. The guy is vile. Which is why he and Russia are going down with a lot of help from the Nato countries. Russians themselves want to tell the world how much grief and hardship they can bear and be proud of it.

China goes down and gets a helping hand. Putin and Russia go down as they get a final swift kick.

You still dont seem to understand what is at play here. The debtor in this situation is not in the position of strength. How well did this work in 2008 for Wall Street and the Fed. In case you missed it, Fanny and Freddie did go under and were bailed out.

Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=afbSjYv3v814

Jan. 29 (Bloomberg) -- Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said.

Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”

I wonder if Russia will give a goodwill warning to China this time, when it comes to treasury debt , as they did with the GSE debt.

Re-read the post you quoted. My post you quoted sums up the situation presented in your post and the attitude respectively of the Russians and the Chinese that I had pointed out. Putin pulled out his Russian scissors but the Boyz threw a net over him.

The news report was made in 2008 so it's been known since then, although it is understood to use it now to make your point. Your point is of course that the crashes and collapsing in the CCP China and the endless downward spiral in Russia will produce the downfall of the United States and its destruction, i.e., monetarism, after which true 19th century gold standard based capitalism will be possible led by the CCP China and Putin's Russia.

Your posts say Russia and China will destroy the United States to save the world from the evil empire of the United States.

My point was to you that the DEBTOR is not in the position of strength in these situations. The US and Wall Street was the debtor and China and Russia were the creditors in the mortgage backed security market and look what happened. Did Wall street "call in" their debt paper ? No. Wall Street fell flat on its face because of Chinese and Russian actions.

Wall Street fell flat on its face because of Chinese and Russian actions.

The Russians and the Chinese together against Wall Street or anything are a coupling of losers whose currency isn't worth a dime any more. If it ever had been worth that much.

The impact on the USA of the ongoing crashing of significant institutions of the CCP economy is not simply a matter of debtor/creditor, or of double entry bookkeeping and balance sheets, although they are all vitally involved.

US runs a trade deficit because (in part) its dollars are needed throughout the world as either the global reserve currency or the global currency of trade, or both. Either way, foreign governments hold close to $9 Trillion USD in their forex reserves. The yuan, which the CCP Boyz have put in the tank indefinitely, runs trade surpluses in the interest of having, well, trade surpluses.

The US provided the bucks, China provided the products. Present developments and events indicate which half of the equation got the better of the deal, especially now that the CCP paradigm economy is revealed as more mirage than miracle.

Now comes the forex reserve selling by the submerging emerging markets that are so attuned to the CCP bucks and Putin's tsarism. Reserve reversal is the present mode and RR is already occurring globally by EMs (emerging markets) from now through next year or beyond.

Global markets expect that by the end of next year, 2016, EMs excluding China will do reserve forex selling of $1.5 Trillion. Add to that the CCP's expected $2 Trillion of reserve reversal selling that has already begun and that would leave $1 Trillion for the midas touch Boyz to finish things off with by making their brief big fortune into a small one.

I think that the USA will somehow weather the all of it.

Edited September 15, 2015 by Publicus

[Publicus]

My point was to you that the DEBTOR is not in the position of strength in these situations. The US and Wall Street was the debtor and China and Russia were the creditors in the mortgage backed security market and look what happened. Did Wall street "call in" their debt paper ? No. Wall Street fell flat on its face because of Chinese and Russian actions.

Wall Street fell flat on its face because of Chinese and Russian actions.

The Russians and the Chinese together against Wall Street or anything are a coupling of losers whose currency isn't worth a dime any more. If it ever had been worth that much.

The impact on the USA of the ongoing crashing of significant institutions of the CCP economy is not simply a matter of debtor/creditor, or of double entry bookkeeping and balance sheets, although they are all vitally involved.

US runs a trade deficit because (in part) its dollars are needed throughout the world as either the global reserve currency or the global currency of trade, or both. Either way, foreign governments hold close to $9 Trillion USD in their forex reserves. The yuan, which the CCP Boyz have put in the tank indefinitely, runs trade surpluses in the interest of having, well, trade surpluses.

The US provided the bucks, China provided the products. Present developments and events indicate which half of the equation got the better of the deal, especially now that the CCP paradigm economy is revealed as more mirage than miracle.

Now comes the forex reserve selling by the submerging emerging markets that are so attuned to the CCP bucks and Putin's tsarism. Reserve reversal is the present mode and RR is already occurring globally by EMs (emerging markets) from now through next year or beyond.

Global markets expect that by the end of next year, 2016, EMs excluding China will do reserve forex selling of $1.5 Trillion. Add to that the CCP's expected $2 Trillion of reserve reversal selling that has already begun and that would leave $1 Trillion for the midas touch Boyz to finish things off with by making their brief big fortune into a small one.

I think that the USA will somehow weather the all of it.

I need to edit my post above but it was past the editing time, so I make this unusual kind of post.

My statement in the post immediately above that, The US provided the bucks, China provided the products. isn't what I'd meant to say.

I'd meant to say the US provided the investment capital and technology alike, the Boyz sent the bucks by the boatload.

And that now the party's over....

[thaibeachlovers]

Oh Lordy, reading some of the posts on here is becoming like climbing the unclimable mountain.

All I know is that whatever happens, like everytime before, the little guy like me is going to be worse off.

[Publicus]

The Fed will announce its rate decision at 1 am Thailand time which is a few hours from now.

The CCP Boyz are strongly against an increase of the rate, which would be the first increase since 2008. This demand comes from the Beijing which has set off a currency war throughout this region and whose economy went negative during the first quarter and looks like 2015 GDP 'growth' of between zero to 3% at best. Exports are collapsing, manufacturing has been negative most of the year, stock markets have collapsed, there's a housing/property bubble and the list gets longer than a baby's arm.

I think the Fed won't increase its rate this time but that and 25 bucks can get me into Starbucks in Manhattan. There's a good case for an increase but the Fed is super cautious about such things. To the Fed no case is strong enough. Inflation is too low and employment data isn't comprehensive enough. The Fed is divided along the lines of 60-40 which for the Fed is not clear or strong enough to move forward. The Fed is an 80-20 institution, so some Fed hawks would have to change sides for an increase to be adopted, which could happen but then Starbucks might give me a free espresso too.

Generally speaking, global central and private bankers expect an increase, economists expect no increase, global corporations strongly want an increase, US markets don't really care, emerging markets are praying the Fed does nothing while the Boyz are instead demanding no increase. No increase won't help the Boyz, it's just that an increase will change their headaches into migraines.

Suggestions from outside the Fed propound an increase ranging from 12.5 basis points to 50 basis points. There's a strong advocacy outside the Fed for a "one and done" increase of 50 bp to let the economy deal with it throughout next year. That would be okay except next year is an election year and the Fed is careful not to have people accusing it of tilting the election either way. A one and done would be unprecedented but it can't be ruled out.

What nobody wants is the last time the Fed did a major rate increase in 1994, when it increased their rate each month for several months, which screwed up the economy. So if there might be an increase, it would be 25 bp now and watch the economy throughout next year, or 50 points now then do nothing next year unless something drastic occurs they don't like.

What the CCP Boyz absolutely do not understand (besides a modern economy) is that the Fed acts in the interests of the United States. The Boyz continue to believe the Fed will act in their interest because the two interests would be the same. They are not the same however.

[Harsh Jones]

One more time. Bernanke didn't say they print money and he didn't say they cause more $USD to come into existence. No he didn't. For those who can understand what he meant, the Fed has been "increasing the (percentage of existing USD) money supply that is available to the general economy.

Ending QE will be raising interest rates to discourage borrowing and tightening bank lending requirements. Banks will be required to lend a smaller percentage of depositors' money.

That will decrease the money supply that is available to the general economy.

It won't affect the amount of USD there is in existence, but rather affect the amount that is available to the economy. The supply of money will decrease without affecting the total amt. of USD in the world.

Again.. how many times do I have to say this... What I mean by money printing is central bank balance sheet expansion. Not physical money printing of notes and coins. Bernanke said that accounts with the Fed are MARKED UP BY THE FED. That is balance sheet expansion which by reality, is dollar stock expansion.

Your last sentence is so contradictory that I will let it speak for itself.

[Harsh Jones]

Re-read the post you quoted. My post you quoted sums up the situation presented in your post and the attitude respectively of the Russians and the Chinese that I had pointed out. Putin pulled out his Russian scissors but the Boyz threw a net over him.

The news report was made in 2008 so it's been known since then, although it is understood to use it now to make your point. Your point is of course that the crashes and collapsing in the CCP China and the endless downward spiral in Russia will produce the downfall of the United States and its destruction, i.e., monetarism, after which true 19th century gold standard based capitalism will be possible led by the CCP China and Putin's Russia.

Your posts say Russia and China will destroy the United States to save the world from the evil empire of the United States.

My point was to you that the DEBTOR is not in the position of strength in these situations. The US and Wall Street was the debtor and China and Russia were the creditors in the mortgage backed security market and look what happened. Did Wall street "call in" their debt paper ? No. Wall Street fell flat on its face because of Chinese and Russian actions.

Wall Street fell flat on its face because of Chinese and Russian actions.

The Russians and the Chinese together against Wall Street or anything are a coupling of losers whose currency isn't worth a dime any more. If it ever had been worth that much.

The impact on the USA of the ongoing crashing of significant institutions of the CCP economy is not simply a matter of debtor/creditor, or of double entry bookkeeping and balance sheets, although they are all vitally involved.

US runs a trade deficit because (in part) its dollars are needed throughout the world as either the global reserve currency or the global currency of trade, or both. Either way, foreign governments hold close to $9 Trillion USD in their forex reserves. The yuan, which the CCP Boyz have put in the tank indefinitely, runs trade surpluses in the interest of having, well, trade surpluses.

The US provided the bucks, China provided the products. Present developments and events indicate which half of the equation got the better of the deal, especially now that the CCP paradigm economy is revealed as more mirage than miracle.

Now comes the forex reserve selling by the submerging emerging markets that are so attuned to the CCP bucks and Putin's tsarism. Reserve reversal is the present mode and RR is already occurring globally by EMs (emerging markets) from now through next year or beyond.

Global markets expect that by the end of next year, 2016, EMs excluding China will do reserve forex selling of $1.5 Trillion. Add to that the CCP's expected $2 Trillion of reserve reversal selling that has already begun and that would leave $1 Trillion for the midas touch Boyz to finish things off with by making their brief big fortune into a small one.

I think that the USA will somehow weather the all of it.

Russia and China single highhandedly with their creditor position caused the biggest bankruptcy in US history with their dumping of US mortgage paper. Fact.

Germany is one of the biggest exporters per capita in the world yet it is 17th in the world in US treasury holdings. Behind such boat anchors and Ireland and India. So your assertion that exporters need USD and US debt is factually wrong.

China is top US creditor and Brazil 5th largest creditor. (submerging markets as you call them) Can you please explain to the people how it is a positive for the US for these countries to sell their dollar debt on the open market and buy back their own currency ? This puts more dollars on the open market and less of the said currencies on the market. That damn Econ 101 again.

The only reason the US has bought this much time since the financial crisis is because these 2 countries were buying up dollars and dollar debt 100's of billions at a time. While the Fed was out buying by the trillions too. Now the "submerging markets" have stopped buying and will become sellers and the Fed is claiming to become a seller too. And you think the dollar will rise.

[Harsh Jones]

The Fed will announce its rate decision at 1 am Thailand time which is a few hours from now.

The CCP Boyz are strongly against an increase of the rate, which would be the first increase since 2008. This demand comes from the Beijing which has set off a currency war throughout this region and whose economy went negative during the first quarter and looks like 2015 GDP 'growth' of between zero to 3% at best. Exports are collapsing, manufacturing has been negative most of the year, stock markets have collapsed, there's a housing/property bubble and the list gets longer than a baby's arm.

I think the Fed won't increase its rate this time but that and 25 bucks can get me into Starbucks in Manhattan. There's a good case for an increase but the Fed is super cautious about such things. To the Fed no case is strong enough. Inflation is too low and employment data isn't comprehensive enough. The Fed is divided along the lines of 60-40 which for the Fed is not clear or strong enough to move forward. The Fed is an 80-20 institution, so some Fed hawks would have to change sides for an increase to be adopted, which could happen but then Starbucks might give me a free espresso too.

Generally speaking, global central and private bankers expect an increase, economists expect no increase, global corporations strongly want an increase, US markets don't really care, emerging markets are praying the Fed does nothing while the Boyz are instead demanding no increase. No increase won't help the Boyz, it's just that an increase will change their headaches into migraines.

Suggestions from outside the Fed propound an increase ranging from 12.5 basis points to 50 basis points. There's a strong advocacy outside the Fed for a "one and done" increase of 50 bp to let the economy deal with it throughout next year. That would be okay except next year is an election year and the Fed is careful not to have people accusing it of tilting the election either way. A one and done would be unprecedented but it can't be ruled out.

What nobody wants is the last time the Fed did a major rate increase in 1994, when it increased their rate each month for several months, which screwed up the economy. So if there might be an increase, it would be 25 bp now and watch the economy throughout next year, or 50 points now then do nothing next year unless something drastic occurs they don't like.

What the CCP Boyz absolutely do not understand (besides a modern economy) is that the Fed acts in the interests of the United States. The Boyz continue to believe the Fed will act in their interest because the two interests would be the same. They are not the same however.

Hilsenrath already hinted that there won't be a rate rise. (i predicted that Hilsenrath would be the next Fed mouthpiece in the US stocks thread)

[Harsh Jones]

Lol how many times will ppl be fooled. And there is a lot of them on this thread who got duped yet again.

No rate hike just like I knew.You can't unwind a ponzi scheme

[Publicus]

My point was to you that the DEBTOR is not in the position of strength in these situations. The US and Wall Street was the debtor and China and Russia were the creditors in the mortgage backed security market and look what happened. Did Wall street "call in" their debt paper ? No. Wall Street fell flat on its face because of Chinese and Russian actions.

Wall Street fell flat on its face because of Chinese and Russian actions.

The Russians and the Chinese together against Wall Street or anything are a coupling of losers whose currency isn't worth a dime any more. If it ever had been worth that much.

The impact on the USA of the ongoing crashing of significant institutions of the CCP economy is not simply a matter of debtor/creditor, or of double entry bookkeeping and balance sheets, although they are all vitally involved.

US runs a trade deficit because (in part) its dollars are needed throughout the world as either the global reserve currency or the global currency of trade, or both. Either way, foreign governments hold close to $9 Trillion USD in their forex reserves. The yuan, which the CCP Boyz have put in the tank indefinitely, runs trade surpluses in the interest of having, well, trade surpluses.

The US provided the bucks, China provided the products. Present developments and events indicate which half of the equation got the better of the deal, especially now that the CCP paradigm economy is revealed as more mirage than miracle.

Now comes the forex reserve selling by the submerging emerging markets that are so attuned to the CCP bucks and Putin's tsarism. Reserve reversal is the present mode and RR is already occurring globally by EMs (emerging markets) from now through next year or beyond.

Global markets expect that by the end of next year, 2016, EMs excluding China will do reserve forex selling of $1.5 Trillion. Add to that the CCP's expected $2 Trillion of reserve reversal selling that has already begun and that would leave $1 Trillion for the midas touch Boyz to finish things off with by making their brief big fortune into a small one.

I think that the USA will somehow weather the all of it.

Russia and China single highhandedly with their creditor position caused the biggest bankruptcy in US history with their dumping of US mortgage paper. Fact.

Germany is one of the biggest exporters per capita in the world yet it is 17th in the world in US treasury holdings. Behind such boat anchors and Ireland and India. So your assertion that exporters need USD and US debt is factually wrong.

China is top US creditor and Brazil 5th largest creditor. (submerging markets as you call them) Can you please explain to the people how it is a positive for the US for these countries to sell their dollar debt on the open market and buy back their own currency ? This puts more dollars on the open market and less of the said currencies on the market. That damn Econ 101 again.

The only reason the US has bought this much time since the financial crisis is because these 2 countries were buying up dollars and dollar debt 100's of billions at a time. While the Fed was out buying by the trillions too. Now the "submerging markets" have stopped buying and will become sellers and the Fed is claiming to become a seller too. And you think the dollar will rise.

Russia and China single highhandedly with their creditor position caused the biggest bankruptcy in US history with their dumping of US mortgage paper. Fact.

No one can produce anything other than the vaudeville entertainer of economics and finance ZeroHedge that accurately and credibly documents that because it is a Mad Max fantasy by those who want the United States to collapse so the CCP Boyz in Beijing and Putin can take control of the global economy.

The inflation that would occur in the CCP China, Russia, Brazil, and the crash of exports in each of 'em if they made any grand sale of US Treasuries would be devastating to their economies. It would crash their economies in a short order depending on the extent of a selloff, the bigger the sale the faster the crash boom bang for all of 'em.

Who would buy their grand selloff? Who could buy such a submerging emerging market suicidal grand selloff? Institutional investors and central banks would buy the instruments in euros, yen, pounds. Then what would these new holders of US debt need to do with their new holdings? They's have to negotiate them in US dollars. Back to square one. Meanwhile bye-bye the economies of the CCP Boyz, Russia, Brazil and any other suicidal maniacs.

None of this would ever be necessary anyway. This is because the Fed and only the Fed controls US base money domestically and globally, not any other foreign government or entity. This is the major reason the Secret Service operates globally against counterfeiters of the currency and against espionage would-be manipulators of the USD as money and its supply. Always, 24/7 globally.

The Fed also has extraordinary authority to deal effectively with any domestic or international movement against the US dollar, economy, financial system. The scenarios presented by the Mad Max America haters who want to see the US economy and its financial system brought to a collapse is exactly the kind of thing the Fed is naturally empowered to kill. The Fed has many more powers than those discussed here.

So just for instance.....

As of March 2015, China is the largest holder of U.S. Treasury bonds and

therefore has considerable influence over the market. This is why many

people think China can put pressure on the United States to get more global

influence.

However, this argument is often overrated as the bonds are still in custody

in the United States and U.S. authorities have considerable power to stop

any kind of market manipulation.

Because China holds so many dollars, they are also vulnerable to a

dollar devaluation, something the Fed can control through various

forms of quantitative easing.

"All we have to do is inflate our currency and pay China back in cheaper dollars

and that reflects a wealth transfer from China to the United States. So China is

completely vulnerable to that.

*“If the Chinese started dumping bonds, all it would take is one phone call

from the president to the Treasury to freeze the bond accounts,”

James Rickards, the author of best-seller “Currency Wars,” told Fox Business.

Read more at http://www.liveleak.com/view?i=456_1432115333#75M5KuOXHraq1O7X.99

The following not only applies to the CCP Boyz in Beijing, but to the gangsters in Moscow and the losers in Brazil all of which have currencies and economies that are drastically in the tank....

There are two reasons why China’s huge investment in U.S. government bonds has stirred controversy in recent years.

First, if the country stops buying or elects to sell even a small portion of its position, Treasury prices would fall and yields would rise. The result of higher rates, in turn, would likely be slower economic growth and higher borrowing costs for the U.S. government.

Second, China’s huge Treasury position is seen as leaving the United States economically vulnerable to the decisions of a foreign government.

That may seem like a potential danger, until you consider why China is buying so much U.S. debt.

The reason is highly technical in nature, but the short answer is that China is buying Treasuries to help depress the value of its currency (the yuan). A cheaper yuan makes the country's exports less expensive for foreign buyers, thereby keeping the country’s export-based economy chugging along. Consequently, the Chinese economy would suffer as much, if not more than, that of the United States if China were to suddenly stop buying U.S. debt.

It’s also important that since China holds such a large position in U.S. debt, the nation has a vested interest in maintaining the health of the Treasury market. Naturally, this provides ample motivation for China to avoid any action that would cause Treasury prices to plunge.

http://bonds.about.com/od/bondinvestingstrategies/a/Chinadebt.htm

Exports over there are tanking and the yuan is appreciating, which is why the Boyz intervened last month to try to reverse the appreciation by CCP government diktat. All this did was set off a currency war throughout East Asia to include Asean. The principal effective result going in to the new year is a neutralising of the CCP commanded depreciation as the other currencies also depreciate.

My god, this is not Econ 101, it is 7th grade math and sophomore in college logic.

Edited September 17, 2015 by Publicus