fakeologist wrote: ↑Tue Sep 21, 2021 12:28 pm
In pre-Covid times, the world economy was on the verge of another colossal meltdown. Here is a brief chronicle of how the pressure was building up:
June 2019: In its Annual Economic Report, the Swiss-based Bank of International Settlements (BIS), the ‘Central Bank of all central banks’, sets the international alarm bells ringing. The document highlights “overheating […] in the leveraged loan market”, where “credit standards have been deteriorating” and “collateralized loan obligations (CLOs) have surged – reminiscent of the steep rise in collateralized debt obligations [CDOs] that amplified the subprime crisis [in 2008].” Simply stated, the belly of the financial industry is once again full of junk.
Remember back during that time period, and what came immediately afterward, and remember what the right-wingers told us. “The Z-Man” was telling us that “Trump was doing pretty good on the economy.” But of course people who know what they are talking about, like the economists at BIS, knew that the economy was “overheating” due to “leverage.” When the lock-downs were implemented, and Trump sent out a measly $1500.00 for people to live on, right-wingers like RamZPaul screamed bloody murder, what about the inflation?
The inflation was in the stock markets and the financial assets. But right-wingers like Z-Man and RamZPaul love it when there is massive, historically high inflation, in the financial system. They consider that a “strong economy” and even – laughably – call it a “free market.” Then, when the economy “overheats” and we enter the inevitable deflationary spiral, these right-wingers are the first to start warning about … inflation.
You just can’t make it up.
9 August 2019: The BIS issues a working paper calling for “unconventional monetary policy measures” to “insulate the real economy from further deterioration in financial conditions”. The paper indicates that, by offering “direct credit to the economy” during a crisis, central bank lending “can replace commercial banks in providing loans to firms.”
Right-wingers love massive money inflation, and high levels of debt, as long as it has the fig leaf of “capitalism” by laundering all of that money printing through commercial banks. You get the inflation – inflation in asset prices – and you get the debt – not just public debt, but private debt too. This is well functioning capitalism. This is what right-wingers want, this is what they demand. Then, when it all blows up, they blame anything except for their own policies.
It’s stunning. Right-wingers are always 180 degrees from truth and reality. To paraphrase a real conservative, Chesterson, right wingers reject the new, progressive lies, not for the truth, but for the old lies they were used to.
15 August 2019: Blackrock Inc., the world’s most powerful investment fund (managing around $7 trillion in stock and bond funds), issues a white paper titled Dealing with the next downturn. Essentially, the paper instructs the US Federal Reserve to inject liquidity directly into the financial system to prevent “a dramatic downturn.” Again, the message is unequivocal: “An unprecedented response is needed when monetary policy is exhausted and fiscal policy alone is not enough. That response will likely involve ‘going direct’”: “finding ways to get central bank money directly in the hands of public and private sector spenders” while avoiding “hyperinflation. Examples include the Weimar Republic in the 1920s as well as Argentina and Zimbabwe more recently.”
Pay close attention here: “going direct” – getting “central bank money directly in the hands of public and private sector spenders.” This is what right-wingers scream about, but the actual people who know how the system works – who are not brainwashed by right-wing economic illiteracy – understood that if the newly printed money went into the banks, the banks would just continue to inflate asset prices and offer lower and lower quality loans – thus, making the systemic problem even worse, which would lead to … another, even worse deflationary collapse six months later.
22-24 August 2019: G7 central bankers meet in Jackson Hole, Wyoming, to discuss BlackRock’s paper along with urgent measures to prevent the looming meltdown. In the prescient words of James Bullard, President of the St Louis Federal Reserve: “We just have to stop thinking that next year things are going to be normal.”
15-16 September 2019: The downturn is officially inaugurated by a sudden spike in the repo rates (from 2% to 10.5%). ‘Repo’ is shorthand for ‘repurchase agreement’, a contract where investment funds lend money against collateral assets (normally Treasury securities). At the time of the exchange, financial operators (banks) undertake to buy back the assets at a higher price, typically overnight. In brief, repos are short-term collateralized loans. They are the main source of funding for traders in most markets, especially the derivatives galaxy. A lack of liquidity in the repo market can have a devastating domino effect on all major financial sectors.
Hilariously, The Z Man is infamous for telling everyone how they “don’t understand economics” then turns around and says, “I just don’t know what these Wall Street guys are doing.” The “Wall Street guys” were doing exactly what people like Z-Man and RamZPaul demand, inflating the stock market, lowering taxes, thus increasing debt, and something irrelevant, like cutting food stamps, because poor people are just “lazy” and “dependent on the government.”
17 September 2019: The Fed begins the emergency monetary programme, pumping hundreds of billions of dollars per week into Wall Street, effectively executing BlackRock’s “going direct” plan. (Unsurprisingly, in March 2020 the Fed will hire BlackRock to manage the bailout package in response to the ‘COVID-19 crisis’).
Before Covid. Were the right-wingers sounding the alarm about this “big government” activity? No, they were celebrating Trump’s strong stock market!
Again, before Covid:
19 September 2019: Donald Trump signs Executive Order 13887, establishing a National Influenza Vaccine Task Force whose aim is to develop a “5-year national plan (Plan) to promote the use of more agile and scalable vaccine manufacturing technologies and to accelerate development of vaccines that protect against many or all influenza viruses.” This is to counteract “an influenza pandemic”, which, “unlike seasonal influenza […] has the potential to spread rapidly around the globe, infect higher numbers of people, and cause high rates of illness and death in populations that lack prior immunity”. As someone guessed, the pandemic was imminent, while in Europe too preparations were underway (see here and here).
18 October 2019: In New York, a global zoonotic pandemic is simulated during Event 201, a strategic exercise coordinated by the Johns Hopkins Biosecurity Center and the Bill and Melinda Gates Foundation.
21-24 January 2020: The World Economic Forum’s annual meeting takes place in Davos, Switzerland, where both the economy and vaccinations are discussed.
23 January 2020: China puts Wuhan and other cities of the Hubei province in lockdown.
11 March 2020: The WHO’s director general calls Covid-19 a pandemic. The rest is history.
BlackRock Authored the Bailout Plan Before There Was a Crisis – Now It’s Been Hired by three Central Banks to Implement the Plan
https://wallstreetonparade.com/2020/06/ ... -the-plan/
The BlackRock plan further explains why, for the first time in history, the Fed has hired BlackRock to “go direct” and buy up $750 billion in both primary and secondary corporate bonds and bond ETFs (Exchange Traded Funds), a product of which BlackRock is one of the largest purveyors in the world. Adding further outrage, the BlackRock-run program will get $75 billion of the $454 billion in taxpayers’ money to eat the losses on its corporate bond purchases, which will include its own ETFs, which the Fed is allowing it to buy in the program.
Helicopter money is also spelled out in the BlackRock plan, which explains why simultaneously with the $454 billion Congress carved out for the Fed under the CARES Act, fiscal stimulus was also “going direct” with $1200 checks and direct deposits to the little people of America and Paycheck Protection Program loans and grants “going direct” to small businesses.