Category Archives: forex

G7 Finance Ministers and Central Banks Governors Coordinate, Collaborate, and Consolidate

G7 Finance Ministers and Central Banks Governors set to coordinate, collaborate, and consolidate to survive global financial turmoil. U.S. Treasury and Central Bank prepare for global integration and inflation of the dollar as it prints more currency.


As U.S. credit markets deathly tighten to an economic standstill, the European Central Bank (ECB) is committed to prevent and thwart any inflation of the Euro. Meanwhile the ECB is showing the U.S. some temporary charity by providing between USD 40 and 50 billion in overnight operations, USD 40 billion in 28-day operations, USD 20 billion in each one of the 84-day operations and USD 20 billion in each one of the forward US dollar operations.


Nevertheless the ECB is retaining flexibility to react to changing market conditions to protect itself from U.S. hegemony and economic stupidity.


Former U.S. President Jimmy Carter blasted President Bush for his foolish economic policies causing $1 trillion indebtedness to China. The atrocious economic policies of the Bush administration has caused the worst global financial crisis since the Great Depression of the 1930s. Profligate spending, massive borrowing and dramatic tax cuts since President George W. Bush took office in 2001 are fully behind the market turmoil and economic crisis.


The economic situation is an entrenched problem, which is going to take years to correct what has been done economically. Eight years ago, the United States had a budget surplus, low inflation and a stable, strong economy. However deregulation and withdrawal of supervision on Wall Street has encouraged irresponsibility in the U.S. financial system, enabling banks to borrow 30 times their value.


The G-7 have their hands full as they try to help the U.S. economy that has yet to guaranty interbank loans. If a national government does not insure and believe in its own banking system, how can its people have any degree of confidence?


Finance ministers from the world’s top economies posed for pictures and pledged Friday to work together to stabilize global financial markets, but did not provide concrete plans to address the credit chaos sweeping the world.


The G-7 agrees that the current situation calls for urgent and exceptional action. Although they commit to continue working together to stabilize financial markets and restore the flow of credit, to support global economic growth, nobody has been transparent enough to tell us how.


Paulson emphasized collaboration and coordination, which signals eventual consolidation as Pres. Bush has for the past 8 years given U.S. debt to foreign nations. Paulson himself has previously prepared American citizens in talks about more financial institutions failing.


General Motors plummeted to a third of its original value with credit markets freezing up.

The so called assets in the failing mortgage industry are toxic and dafaulted assets at best, which few want.


The finance ministers have their work cut out for them. They surely must announce concrete steps by the end of the weekend if they want to soothe the roiling markets. The stock markets throughout the world are not responding to cheap talk and press hype. We need to see real action. Any thing less tells me central banks are conspiring to consolidate and devalue national currencies so as to usher in a new world order.


The Dow Jones industrial average fell over 1,874 points, or 18%, in its worst weekly decline ever on both a point and percentage basis. Wall Street lost roughly $2.4 trillion in market value during the week.


Markets worldwide fared no better, with every major exchang losing. Black Friday as it was called in Australia caused stock markets to take an 8% nosedive adding to a 42% drop in a year within the Aussie market. The Japanse stocket market has lost 53% this year thus far. Russia’s index has fallen 61% as investors pull out money and flee for cover. The UK’s top companies have fallen 21%.  Germany’s market fell 7% and 28% on the week.


There is no containing the deepening global financial crisis. Central Banks and the Federal Reserve coordinated interest rate cuts did not soothe nervous investors.

The Fed lowered its benchmark interest rate by a half-point to 1.5%. The European Central Bank, which had kept rates unchanged as the Fed engaged in a string of rate cuts over the last year, cut its rate by a half-point to 3.75% – its first cut in five years. The Bank of England also cut its rate by a half-point to 4.5%. The Swiss, Canadian and Swedish central banks also made cuts. Yet the Libor rate rose disproportionately eliminating the usefulness of any cuts as indicated in the markets which failed to respond.


The Dutch and Belgian governments took over Fortis, before selling pieces of it to BNP Paribas. The British are nationalizing mortgage lender Bradford & Bingley.

And some nations, including Ireland, France and Germany, have said that all bank deposits will be insured by their governments for the time being.


Afraid to insure their own bank deposits to the full the United States and United Kingdom are developing plans to inject capital into banks, which would entail acquiring stakes in the institutions.


Some speculate the G-7 countries can work through this crisis by dealing with bad assets, recapitalizing banks, and providing much needed liquidity. Other economists predict it will take up to 2 years to fully work through the economic problems created over the past 8 years. Fixing the financial, regulatory, and supervisory system that failed will take time and not be done overnight.


Each country, of course, will have to take steps to address its particular problems.

U.S. Treasury Paulson himself mentioned that the press and some markets are naive to think that different countries with different financial systems – and different political systems, different laws – are going to come up with precisely the same policy to deal with the issues.


That being said, I am betting on the European Central Bank where China, Russia, Iran, OPEC, Dubai, and other major global financial players are putting their assets and foreign currency reserves. When China who holds $1 trillion in U.S. debt begins to diversify after the Fannie Mae and Freddie Mac fiasco, look for chaos to surface and devastate U.S. markets and plunge the dollar to the basement.


Billionaires George Soros, Warren Buffet, and American hedge fund manager John Paulson are betting against the dollar. I’m putting my money therefore in gold or Euros.


Care to join me?


Buy Euros while the dollar is strong before Wall Street reveals disaster and bankruptcy in America. Warnings from Federal Reserve Chairman Ben Bernanke and Central Banks across the world. Turmoil for global financial markets. Buy Euros or gold now!


Warnings from Federal Reserve Chairman Ben Bernanke and Central Banks across the world. Turmoil and serious consequences for global financial markets. Buy gold or Euros to protect your savings.


Bernanke’s fiscal policy speech to the Bank of International Settlements (BIS) on July 8, 2008 calling the U.S. economy in “turmoil” was quite revealing. Meanwhile Bernanke and Paulson reported to the media and American people the economy was fundamentally strong.


Bernanke told the BIS in July, 2008 it is “Unrealistic to think financial crisis can be eliminated”.


The euro was used in around 37% of all foreign exchange transactions in April, 2007.


Protect your savings!


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Buy Gold or Euros – Dying American Dollar, Rising Euro and Gold, Crisis in U.S. Capitalism

[big]Buy gold and Euros as the American dollar dies amid a crisis in U.S. capitalism.[/big]


Warnings from Federal Reserve Chairman Ben Bernanke and Central Banks across the world. Turmoil and serious consequences for global financial markets. Buy gold or Euros to protect your savings.


Bernanke’s fiscal policy speech to the Bank of International Settlements (BIS) on July 8, 2008 calling the U.S. economy in “turmoil” was quite revealing. Meanwhile Bernanke and Paulson reported to the media and American people the economy was fundamentally strong.


Bernanke told the BIS in July, 2008 it is “Unrealistic to think financial crisis can be eliminated”.


The euro was used in around 37% of all foreign exchange transactions in April, 2007. If you care about protecting your dollar invest in gold or Euros before inflation devours your dollar overnight.


A massive 777 point drop in Wall Street stocks on September 29, 2008 is sufficient evidence of things to come.


If you still are not convinced and like many across America remain nieve trusting “big brother” to take care of you, think again!


“Despite the efforts of the Federal Reserve, the Treasury, and other agencies, global financial markets remain under extraordinary stress. Action by the Congress is urgently required to stabilize the situation and avert what otherwise could be very serious consequences for our financial markets and for our economy.”


Ben S Bernanke: Economic outlook when giving before the Joint Economic Committee, US Congress, Washington DC, 24 September 2008.




“As one banker famously said last year “As long as the music is playing, you’ve got to get up and dance”. Well, if it is the role of the central banker to take away the punch bowl just as the party gets going, perhaps the role of the supervisor is to silence the band so the bankers stop dancing.


Investors did not perform their own due diligence. Instead, they relied on the due diligence of originators and packagers, who lacked interest in exercising this due diligence. They also placed undue reliance on the judgments of the credit rating agencies, and the capacity of modern technology and diversification to manage financial risks.


What can we draw from this? The combination of excess lending with an obvious failure to adhere to fundamental and sound risk management standards not only produced significant losses in mortgage portfolios; it also tainted an asset type that was key in the broader securitisation and credit distribution process.”


Nout Wellink: Responding to uncertainty

Remarks by Dr Nout Wellink, President of the Netherlands Bank and Chairman of the Basel Committee on Banking Supervision, at the International Conference of Banking Supervisors 2008, Brussels, 24 September 2008.




The United States is currently in the midst of a financial crisis, the backwash of which is sweeping through the global financial system. …The most recent wave of financial turbulence is the worst so far since the original US mortgage crisis broke out.


Inflation means that everyone gets less for their money. Oil, electricity and food prices have risen substantially. These goods are an important part of household consumption. …these goods have become more expensive in the world market.”


Stefan Ingves: Financial turbulence, monetary policy and inflation

Speech by Mr Stefan Ingves, Governor of the Sveriges Riksbank, to SACO, the Swedish Confederation of Professional Associations, Stockholm, 24 September 2008.





“What I was afraid of has occurred.


In the USA, the shortcomings of governance in the financial system have been revealed for all to see in the crisis….  To begin with, the Fed was not so well equipped with instruments for the liquidity policy action necessitated by the subprime crisis.”


As I can report from my own experience, but [b]without giving too many secrets away[/b], [i]the Eurosystem has earned a great deal of respect in the international institutions and bodies which are dealing in depth with the financial crisis[/i] and the lessons and implications to be drawn from it.”


Hermann Remsperger: Fundamental issues of stabilising the financial system

Keynote speech by Professor Dr Hermann Remsperger, Member of the Executive Board of the Deutsche Bundesbank, at the conference on “Determinants and implications of the financial crisis” of the Frankfurt School of Finance & Management – Bankakademie, HfB, Frankfurt am Main, 17 September 2008.




First, we should further step up our efforts to build a truly integrated, safe and highly competitive European financial market. The tenth anniversary of the ECB one month ago gave us the occasion to take stock of the achievements in European financial integration over the past decade. We were proud to find that significant progress has been achieved and that the introduction of the single currency has acted as a major driving force in this regard. However, as I would like to underline today, [b]further efforts are necessary to make the single financial market a reality.[/b]


While financial integration is first and foremost a market-driven process, authorities can play an important supportive role in a number of ways, for instance by acting as catalysts for private sector initiatives and by reducing policy-related obstacles to cross-border finance. The Eurosystem can also provide central banking services that support the financial integration process.


[b]Europe is one of the major building blocks of the global economy and, as such, needs to play a very active role in fostering sound financial globalisation.[/b]


Responding to the global financial market correction


[b]Financial integration is proceeding not only within Europe, but also at the global level.[/b] Financial globalisation enables the international community to share significant benefits in terms of enhanced financial efficiency and economic growth, but it also makes the safeguarding of financial stability a more interdependent endeavour. Effectively coordinated international action aimed at addressing financial system vulnerabilities has therefore become very important, as highlighted during the ongoing financial market correction.


The report of the Financial Stability Forum (FSF) on Enhancing Market and Institutional Resilience has been fully endorsed by the international community and provides the main reference point for the necessary improvements.


Lastly, closer ongoing cooperation should be pursued not only between supervisors, but also between supervisors and central banks. Such joint work, to be pursued at all levels (nationally, regionally and globally), would in particular aim to enhance the integration of supervisors’ micro-prudential functions and central banks’ macro-prudential functions in the assessment of possible financial risks and vulnerabilities. This would make a significant contribution to raising awareness of emerging financial system imbalances at an earlier stage and devising effectively coordinated public sector action to address them. …increasingly important to ensure a comprehensive and consistent treatment of the respective financial risks.


Jean-Claude Trichet: Fostering sound financial globalisation – the role of Europe

Speech by Mr Jean-Claude Trichet, President of the European Central Bank, at the Paris Europlace Financial Forum “The Paris Marketplace Contribution to the Global Economy”, Paris, 2-3 July 2008.

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Asian Financial Markets Crumble with the U.S. Dollar

Asian markets crumble…..the Hong Kong stock market loses over 1,000 points in a single day and over 7%…..but the Euro rose.
Put your money in gold or Euros quick if you have a savings account.

Paul F Davis – worldwide speaker, consultant, author, and prophet

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Declining Dollar and U.S. Economy – Greenback has a Heart Attack

As the U.S. economy tanks and the dollar declines many on Wall Street and throughout global financial markets are anticipating the ultimate death of the dollar when the greenback eventually has a heart attack.

Unfortunately as Washington D.C. has shown historically, corporate bankruptcies are commonplace in periods of economic decline as fat cat CEOs leave with the dough, and taxpayers are left picking up the slack for corporate greed and ill management.

When Fannie Mae, Freddie Mac, Lehmon Brothers, and Meryll Lynch all go bankrupt rest assured the U.S. economy is dead. With a 9 trillion dollar deficit as a nation currently spending hundreds of billions of dollars needlessly to fight a war in Iraq, the United States knows no economic restraint.

Corporate bailouts and corporate welfare will only serve to further weaken the dollar and drive OPEC toward the Euro, Yen, and other currencies.  That being said as an investor and savvy consumer, the best way you can protect your money is to learn about foreign currency exchange and be far ahead of the curve before banks in your neighborhood declare bankruptcy, freeze your savings, and diminish your dollar overnight.

Go to and make profits trading currency. Don’t be like millions of Americans losing their hard earned savings, investments, and income to a dying dollar. 

Awake to the reality that America is not indefeatable.  If you didn’t learn this lesson yet from the terrorist attacks of 9-11, you may have to repeat the pain of ignorance and arrogance when the dollar dies and your savings & investments dwindle overnight.

Paul F Davis – worldwide speaker, prophet, and prolific author of 14 books including United States of Arrogance

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