No, Mr Bond, I expect you to re-set your economy - Jim Duffy
I love it as it embraces bucketloads of proactivity, foresight, future planning, will to win and sheer ambition to live and prosper. In short, no-one beats James Bond.
And in a movie reality that works well as Mr Bond has carte-blanche to do as he pleases for Queen and country. But what about when one of the highest ranking and most powerful American Treasury official utters these words? Well Janet Yellen, the 78th Secretary of the Treasury, Former Fed Chair and esteemed economist just did. And even James Bond won’t win this fight.
The United States of America boasts 10 Nimitz class “super-carrier” aircraft carriers. These gigantic floating battle fortresses accompanied by all their supporting destroyers and nuclear submarines, we have always been told, help keep world peace. Any country except China and Russia, who do not like being bullied, has to get into line when one of these carriers is parked off its coast and poised to strike. Peace keeping is a well known euphemism for extending American political and financial power, so the average American can feel good, get teary eyed at the Star Spangled banner and be free to eat McDonalds. I fear these carriers may be strategically deployed more often over the next couple of years as Janet Yellen goes all James Bond and America dictates global monetary policy to the G7, G20 and all other “G”s remaining.
Ms Yellen stated this week, “as I prepare to meet with me colleagues from around the world this week at the IMF and World Bank Spring Meetings, I find myself thinking back to the policymakers who gathered in Bretton Woods a year before I was born to define our post-war order.” One could be forgiven for thinking Yellen was getting all misty-eyed. But, nothing could be further from the truth. This “innocent” statement is code for only one thing. America sets the agenda, America is the agenda and America will always be the agenda. In short, we set the world order back then in 1944 and we are about to “re-set” it. It is a not just a warning shot, but an instruction to all others that if you don’t play ball, it won’t end well. America needs to borrow big, so you will all borrow big.
You see America is currently in the throes of massive fiscal stimulus that’s built upon debt that is built upon even more debt. At $28 Trillion and rising, there is no way to pay off this debt. With every sentence I write here, it goes up $100,000. So, rather than even attempt to pay this down, America is gonna borrow more to “stimulate” its economy and generate wealth that will then pay it down. But, for the USA to do so means that the US dollar would collapse against other currencies. One only needs to look at the strength of the pound or the Euro in the last year to see how the US currency is struggling. So, the diktat within the coded message to her colleagues is this. We borrow likes there’s no tomorrow and you do too. That way Americans continue to live the dream, our dollar stays strong against you, everyone’s debt rises “together” and we will not need to park a US aircraft carrier off your coast to make you comply.
Make no mistake the global economic re-set is coming and everyone will fall in line. Janet Yellen went on, “Though it was a different time, I empathise with the enormous weight they faced….. Our current juncture is no less significant - what we do in the coming months will have profound impacts on the trajectory of the global economic order.”
Feels a bit Spectre - like eh Mr Bond?
Jim Duffy Create Special
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