Following the prescription of the U.S. Federal Reserve begun under Ben Bernanke, the president of the European Central Bank, Mario Draghi, is about to unleash the monetary torrent that is referred to as quantitative easing. With the Eurozone remaining mired in a sea of economic stagnation, fiscal debt crises and enduring deflation, Draghi is gearing up the printing presses, boasting that the ECB will succeed where the Eurozone politicians failed.
With a 1.1 trillion euro quantitative easing program about to be launched, which is roughly equivalent to $1.250 billion USD, many in the markets are hoping that the perceived improvement in American economic metrics attributed the Fed’s quantitative easing will come to Europe soon. The massive debts that will never be repaid and the unprecedented distortions created in the U.S. market by those loose monetary policies are at present out of sight. There is such desperation in the Eurozone, amplified by the impotence of the political class, that the ECB is, just as with the Fed in the U.S., the last hope for the European economy.
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The Eurozone economy is dead in the water, the ill winds of economic recession are blowing and the politicians are dumfounded. Once again, the European Central Bank must step in with radical monetary fixes to cope with the lack of coherent economic and fiscal policy by the sovereigns. With ECB interest rates already at a nominal 0.05 percent–essentially zero interest rate– a desperate ploy has just been announced.
Mario Draghi, president of the ECB, has made it known that he will now be buying up troubled assets and collateralized debt. The hope is that this will cool off the heat of threatening deflation, while kick-starting the Eurozone economy. If that fails, he will no doubt then resort to quantitative easing. Stay tuned.
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Continuing a two year trend that has seen the once AAA rating of French sovereign debt reduced, the ratings agency S & P announced it is cutting its rating on government debt from Paris to AA. This decision flows from the moribund state of the second largest economy in the Eurozone, which is suffering from high unemployment, large public deficits and a failure to engineer strong economic growth.
The government of French President Hollande came to office on a pledge to create new jobs by defying the austerity trends of other Eurozone partners, in part to be financed by higher taxes. The populist message of Hollande, once translated into public policy, has failed to lift the French economy, and notwithstanding the boasts of politicians in Hollande’s administration, S & P clearly sees sovereign debt issued by France as being less credit worthy in the wake of current fiscal and economic policies.
In the meantime, the European Central Bank, which under its president, Mario Draghi, has followed in lockstep with the Fed’s Ben Bernanke in implementing a near zero interest rate policy (ZIRP), has just cuts its interest rate from half a percent to a quarter of a percent. The most recent rate reduction by the ECB, in conjunction with S & P’s lowering of France’s credit rating, demonstrates that the fiscal and economic woes in the Eurozone are far from over. The Eurozone crisis continues.
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WALL STREET KILLS--A CHILLING NOVEL ABOUT WALL STREET GREED GONE MAD
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To the delight of equity markets, ECB president Mario Draghi has announced officially that the European Central Bank will purchase Eurozone bonds in the secondary market, with three-year maturities, theoretically without any limits. In effect, Draghi has told the world that the ECB will run its printing presses at warp speed, and conjure out of thin air whatever quantities of euros are required to combat what Draghi calls “market distortions.”
The Bundesbank opposes the move, and Germany’s traditional fear of inflationary policies by central bankers will no doubt be awakened. Draghi’s position is that he has no choice, if the euro is to be saved. His policy measure reminds me of what a U.S. Army officer once said, after his unit destroyed a village during the Vietnam War: “We had to destroy the village in order to save it.” Draghi may have unleashed a desperate policy measure which, in attempting to save the euro, will ultimately bring about its demise.
WALL STREET KILLS--A CHILLING NOVEL ABOUT WALL STREET GREED GONE MAD
To view the official trailer YouTube video for “Wall Street Kills,” click image below:
In a world dominated by high finance, how far would Wall Street go in search of profits? In Sheldon Filger’s terrifying novel about money, sex and murder, Wall Street has no limits. “Wall Street Kills” is the ultimate thriller about greed gone mad. Read “Wall Street Kills” and blow your mind.
Increasingly, amidst the worsening Eurozone debt crisis. the European Central Bank is becoming the center of gravity for not just insolvent sovereigns within the Eurozone; the bulk of the global economy is facing towards the ECB president, Mario Draghi, in much the same way as the pious do towards Mecca. With the bulk of Europe, including not only the Eurozone countries but also the UK mired in recession and unending economic crises, the bond vigilantes and investors have largely given up on the politicians.
Will Mario Draghi follow the pattern of the U.S. Federal Reserve and its chairman, Ben Bernanke, in dropping loads of cash from his virtual helicopter, freshly conjured out of thin air through the magic of the central bank’s printing press? It is a sign of the times, and the incessant global economic crisis, that supposedly sophisticated investors are desperately hoping for the unleashing of a torrent of legal counterfeiting by the central bankers as the final chance to ward off fiscal calamity.
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WALL STREET KILLS--A CHILLING NOVEL ABOUT WALL STREET GREED GONE MAD
To view and listen to the YouTube video audio excerpt “Wall Street Kills,” click image below:
Sex, murder, financial power and pathological greed come together in the explosive suspense thriller by Sheldon Filger, WALL STREET KILLS: A NOVEL ABOUT FINANCIAL POWER, VIOLENT SEX AND THE ULTIMATE SNUFF MOVIE.
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The latest report from the World Economic Outlook, released by the International Monetary Fund, cuts its forecast on global GDP growth. Of greater importance is the focus the IMF placed on the Eurozone debt crisis. According to the IMF report, “The utmost priority is to resolve the crisis in the euro area.”
The IMF appears to be standing with those who are calling for the European Central Bank to replicate the loose monetary policies and money printing of the U.S. Federal Reserve and its chairman, Ben Bernanke. The report virtually pleads for the ECB president, Mario Draghi, to place his printing presses in overdrive.
“The ECB should ensure that its monetary support is transmitted effectively across the region and should continue to provide ample liquidity support to banks under sufficiently lenient conditions,” so says the International Monetary Fund in its report. It appears that the IMF is seeking Weimar style solutions to the European debt crisis, obviously forgetful of what those policies did for Germany in the 1920s and early 1930s.
WALL STREET KILLS--A CHILLING NOVEL ABOUT WALL STREET GREED GONE MAD
To view and listen to the YouTube video audio excerpt “Wall Street Kills,” click image below:
Sex, murder, financial power and pathological greed come together in the explosive suspense thriller by Sheldon Filger, WALL STREET KILLS: A NOVEL ABOUT FINANCIAL POWER, VIOLENT SEX AND THE ULTIMATE SNUFF MOVIE.
This video provides a free audio reading from chapter one of “Wall Street Kills.” The scene depicted involves two characters from “Wall Street Kills” having a business conversation in a Los Angeles suburb. One character is Peter Hoffman, director of new business development for a secretive Wall Street hedge fund and private equity group. The other character is Daniel Iachino, president of a major independent film company specializing in “adult entertainment” for niche markets. Hoffman is on a mission to investigate if portraying unsimulated violent death in the
form of entertainment would be a lucrative business investment. The conversation between the two men quickly focuses on the phenomenon of snuff movies.
ECB President Mario Draghi, it is rumored, will cut interest rates, in a frantic effort to retard the rampaging Eurozone Debt Crisis. Since assuming the ECB presidency, Draghi has engaged in stealth quantitative easing, buying up sovereign bonds, and engaging in other monetary gimmicks. But nothing seems to be working. With ECB rates already very low, there is not much left to be cut.
The schism is over supposed austerity measures in the vulnerable Eurozone countries with large sovereign debts neutralizing any impact from ECB monetary policies. However, the real issue involves the bond markets; will they open up their coffers and offer more loans to countries that already have an unsustainable debt to GDP ratio? In the Eurozone, both economic /fiscal and monetary policies are totally detached from the harsh realities of the marketplace.
Only a few weeks after the latest version of the Greek bailout package, the President of the European Central Bank, Mario Draghi, is boasting that the worst of the Eurozone debt crisis is “over.” He made this remarkable claim in an interview with a German publication. Draghi boasted that the economies of the Eurozone were now stabilizing.
Draghi must be toking some powerful weed, or otherwise he is attempting to repeat U.S. Fed Chairman Ben Bernanke’s previous boasts about economic “green shoots.” The latest PMI figures from Germany, which show that the country’s manufacturing sector is weakening, and other similar statistics from elsewhere in the Eurozone, make ECB president Draghi’s boast sound bizarre, to say the least.
Despite Mario Draghi’s high profile delivery of rosy prognostication, the Greek debt crisis is far from over, and the other PIIGS nations (Portugal, Ireland, Italy and Spain)have not seen their dangerous debt and deficit to GDP ratios, poor economic growth figures or catastrophic levels of unemployment magically improve. Draghi may be a wonderful propagandist for the Eurozone, but he is no magician.
It appears that the European Central Bank under the leadership of Mario Draghi is following in lockstep with the policy prescription devised by the Chairman of the U.S. Federal Reserve, Ben Bernanke. Just as the Fed expanded its balance sheet to over $2 trillion, in the process becoming the lender of last resort to U.S. banks that would otherwise have been insolvent without the cheap credit from Bernanke (and changing accounting rules from “mark to market” to “mark to fantasy”), the ECB is now doing exactly the same in the Eurozone.
Already, through its stealth quantitative easing program, the European Central Bank has expanded its balance sheet by more than $1.3 trillion, thus preventing Europe’s banks from collapsing due to the weight of worthless assets they hold in sovereign loans to insolvent (and defaulting)nations such as Greece, along with Ireland, Portugal, Italy and Spain on their balance sheets.
It is no surprise that many investors, and certainly all the banks, are cheering central bankers such as Bernanke and Draghi. They seem to ignore the fact that if money printing by central banks were truly an effective method of restoring genuine economic growth, than counterfeiting would be legal for us all, and not just the trans-sovereign central banks.
It appears that the ECB is abandoning its policy of monetary prudence, and imitating U.S. Fed Chairman Ben Bernanke in running its printing press wildly. Mario Draghi, ECB boss, has made available cheap loans to European banks experiencing liquidity problems. In response, more than 500 European banks stampeded to the ECB discount window, and have borrowed nearly 490 billion euros, equivalent to $643 billion USD at current exchange rates. Clearly, the European banks had desperate need for new capital, while the Eurozone politicos hope the banks will use the newly minted euros to buy European sovereign debt.
Nouriel Roubini I think described this rather nicely as in essence quantitative easing and stealth debt monetization. As with Ben Bernanke’s repeated bouts of money printing, I don’t think this new loose monetary policy by Mario Draghi will avail itself of any meaningful results. Since the global financial and economic crisis was unleashed in 2008, money printing by central banks has been a symptom of the problem, not its solution.
Officer Larry of the NYPD is on his way to Zuccotti Park in lower Manhattan to arrest peaceful protesters involved with the Occupy Wall Street movement. Being a public spirited member of the New York Police Department, Officer Larry does remind us that there is a global economic crisis underway that rivals the Great Depression of the 1930s.
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