Global Financial Tsunami

By P Chong     Mon. 15 August 2011

Not since 1917 has the United States of America been faced with the downgrading of its Credit Rating until this fateful Friday on 5 August 2011 from its AAA standing to AA+. Standard & Poor’s well justified its action evidently by US’ ceaseless mounting national debt & its inability to pay.

David Walker, former US Comptroller General, says he’s not surprised that Standard and Poor’s downgraded the U.S. credit rating for the first time in history.

There’s no doubt that these are tough times.

Europe and the US are both wrestling with the reverberations of the GFC as the various governments on either side of the Atlantic confront the reality that throughout 2008 and 2009 they were obliged to bail out the privately run financial miscreants with massive injections of taxpayer moneys, just to prevent a complete meltdown of the global financial system. It has been a close-run thing, and the latest aftershocks are an indicator that we have further to go. (National Times AU).

Setting aside all political rhetoric, just through simple common sense of the “Man in the Street” as against the “Men in Wall Street” – great financial wizards or more correctly manipulators & crooks, the game of living it up beyond the economic limit cannot go on & on. The world at large cannot be held at bondage to keep on supporting the glamour & luxuries that’s been put on show.

  • Robbing Peter to pay Paul

  • Cutting the cloth according to your fit

  • Simple economic rule of supply & demand

  • Over-subscription hits on pride & plight

are all familiar to the layman, but completely thrown out of the window by the game that politicians play!

Take a close look at the above map of “National Debt by Country”. The key to take note is the debt percentage to the GDP (Gross Domestic Product). With the exception of Russia, most of the great rich countries, show a dismal performance in this economic aspect.

They say that the “Gate of Hell” has three main entrances: anger, lust & greed. In this case, GREED is the biggest culprit. The Romans had their fall. Similarly, such fate awaits the mighty & tall. For far too long, US has been pulling the economic wool over the eyes of the world – its currency has no tangible value as backed by gold . . . only the world’s confidence support it as the reserve currency. It’s really “toilet” paper money which US Treasury resorts to printing in plentiful amount in short term measures for long term benefits.

I remember the days during the Japanese Occupation in Malaysia, my father was landed with bags & bags of Japanese notes that were worthless as toilet paper! These days in Zimbabwe, people are going around with bundles of paper money for just daily shopping needs. Want to own a Zimbabwe billion dollar note?

There’s no such thing as being “Too big to fail!”

Without order, chaos will prevail!

Watch out! This financial virus is fast catching on globally!!!

Who Owns The U.S.?

By P Chong 2 March 2011

Google Image: Obama

Who owns the U.S.? Certainly not the Congress nor the White House nor the U.S. citizens. Read on this short concise & shocking report & find out . . .

U.S. NATIONAL DEBT CLOCK

The Outstanding Public Debt as of 01 Mar 2011 at 07:37:14 AM GMT is:

$14,152,979.452.299.10

The estimated population of the United States is 310,121,353 so each citizen’s share of this debt is $45,636.91

The National Debt has continued to increase an average of $4.12 billion per day since September 28, 2007!
 Concerned? Then tell Congress and the White House!

Seven generations from now we will all be owned by the banks and be impoverished if this continues!

(This debt clock is maintained by Ed Hall (edhall@brillig.com). It was last calibrated using information obtained from the U.S. Department of the Treasury dated 25 February 2011. Population figures are derived from the U.S. Bureau of the CensusPopulation Clock.)

Whatever the rhetoric that Obama or the politicians or economists offer, figures speak louder than words. Facts & figures won’t lie. Without inputs & only withdrawals the coffers soon run dry. It can only disasters! Regardless of how much closer Obama’s budget brings U.S. economy into a balance of payments not seen since 2001, it will continue to run deficits for the next decade, and the national debt will just keep growing every year.

The Treasury Department and the Federal Reserve Board estimate that while most of the country’s $14 trillion debt is held by private banks in the U.S., as of December 2010r, about $4.4 trillion of it was held by foreign governments that purchase its treasury securities much as an investor buys shares in a company and comes to own his or her little chunk of the organization.

Looking at the list of our top international creditors, a few overall characteristics show some interesting trends: Three of the top 10 spots are held by China and its constituent parts, and while two of our biggest creditors are fellow English-speaking democracies, a considerable share of our debt is held by oil exporters that tend to be decidedly less friendly in other areas of international relations.

China $891.6 billion 20.40%
Japan 883.6 billion 20.20%
United Kingdom 541.3 billion 12.40%
Oil Exporters 218 billion 5.00%
Brazil 180.8 billion 4.10%
Caribean Banking

Centres

155.6 billion 3.60%
Hong Kong 138.2 billion 3.20%
Canada 134.6 billion 3.10%
Taiwan 131.9 billion 3.00%
Russia 106.2 billion 2.40%
Source: U.S. Bureau of Economic Analysis (2009)    

Let’s hope Russian president Dmitry Medvedev, the least of the 10 creditors, doesn’t come to collect.

Over the years, America’s status as a creditor or debtor has changed enormously. In the early 1980s, America’s net international investment position averaged $350 billion, or 11 percent of GDP, making the United States the world’s largest creditor. Today, it is the world’s largest debtor – by far.

Foreign governments have taken notice – in particular, China, which now holds more U.S. Treasury debt than any other country. In the 12 months through April, China’s portfolio of Treasury debt securities has soared by more than a quarter of a trillion dollars to over $800 billion.

In its annual financial stability report issued on Friday, China’s central bank once again declared there were serious problems with the global monetary system’s reliance on a single dominant currency – the dollar. An estimated 65 percent to 70 percent of China’s $2 trillion in foreign exchange reserves, the world’s largest stockpile, is held in dollar-denominated assets.

Google Image

The People’s Bank of China is taking steps in the right direction with its expansionary monetary and fiscal policies. It is making available & possible for its trading partners to use the Yuan as the currency of exchange instead of solely dependent upon the U.S. dollar.

The people in the Middle East . . . the Tunisians, the Egyptians, the Libyans . . . their loss as compared to the American citizens are but pittance. Now it looks like the upheaval, riot & civil unrest are spreading to other parts of the Middle East . . . Bahrain, Saudi Arabia, Oman, Yeman and others.

Google Image: Middle East Unrest

It’s democracy gone crazy!

Or is it just a ploy & secret agenda of vested party (or parties) to wrest & control the wealth of oil in the region?