Saturday, October 11, 2008

Doesn’t Matter What The BoE Does.

Interbank lending in deep freeze

"The rate at which banks lend to each other has risen despite aggressive measures from governments worldwide to tackle the credit freeze." .................. "Three-month Sterling Libor has risen to 6.285%, while three-month euro Libor stands at 5.366% - near 14-year highs."

Posted by renting2 @ 09:43 AM (1241 views)
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18 thoughts on “Doesn’t Matter What The BoE Does.

  • “a sad picture”? Ooh, because this means expensive mortgages and more falling house prices, and more likelihood that BBC executives will have to offload their but to let portfolios. Now I understand why the BBC meeja people are sad.

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  • planning4acrash says:

    The only reason central banks are pumping in liquidity is because the commercial banks aren’t lending to each other. Why do they lend to each other? To maintain fractional reserves.If A’s reserves are below financial rules, A borrows from B who is over their reserve requirement. This system assumes balance, which rarely occurs during mass defaults. So, to maintain the fractional reserve system, one needs a central bank to provide liquidity when commercial banks have run out.

    First of all, the fractional reserve system stinks. It means that banks are printing and lending out money they don’t have. It is counterfeit and fraud, and the reason why we have inflation and an elite with access to as much money as they want. So, we may want a return to interbank lending, but that system logically ends up where we are today. The old system was a transition to centralised monetary oligarchy. So we need a sound money system where fractional reserves and usery are outlawed. Because even a small use of them will start the economy on a slow march towards the central bank oligarchy we see today, particularly, tho not exclusively in the USA with the private, unconstitutional Federal Reserve.

    The problem is, that the global solution about to be put forward is the Babylonian system of usery and fractional reserves, totally divorced from any limits nations put on it, and, at a scale that dwarfs the Federal Reserve system. Regional currencies like the Euro, and soon to be, the Amero, will be adjuncts to a global bank. This is coming into view with co-ordinated interest rate movements that meet the needs of international financiers with no regard whatsoever to local needs. For example, poor old Spain is being wreaked by these interest rate cuts. Germany is doing a bit better because it needs more liquidity, but the result, for people on the ground is always unbalanced. No one country will ever reach the equilibrium it needs to foster a vibrant free market system.

    But maybe that is the silver lining. What we are seeing, with this globalised Corporate Socialism (layered upon a mutated form of national, but becoming global socialism), is something as, or more inefficient than Communism. Now, Communist Russia was so inefficient that it, even with its vast grain areas, could not feed its people. Investors simply, were bereft of any market signals or rewards. It was sustained by North American grains, because the free market there, exposed to Russian demand, met those demands.

    In a global Corporate/national & global Socialist system, there are no dynamic free markets to meet any needs. The elite, it appears, seem to think that a hybrid between western capitalism and socialism will result in markets that kind of do the job, but I don’t see it working. Their only hope is that the military industrial complex creates an economy and destroys the excesses in society that could otherwise be utilised to liberate the middle classes, who could then rival the ruling oligarchy. They also pin their hopes on technology, that they will be able to bypass the need for a free market, via the efficiency of machines and computers. But anything, when truly efficient, liberates those who use it. And liberation results in freedom. Right now, we have a free market in ideas, and it looks likely that the elite will have to destroy the free internet to maintain control over propaganda and ideas. But instantly, they have destroyed the cutting edge that could have provided enough abundance to sustain their system.

    So their system, even if they get it, is likely to break down. That’s why we hear talk of eugenics. The elite know that a global socialist system cannot work with so many people. When the UN say there are too many people, they mean that there are too many people for the Socialist system they invisage. So, we see the following, we see mercury/formaldehyde in the shots, Aluminum and Barium in persistent contrails, melamine in dairy products from China. Fluoride, chlorine, etc in water, No access to nutritious unpasteurised/unhomogonised milk, then there’s bird flu, they claim to have a vaccine, yet it isn’t physically possible to form a vaccine for a virus that has not evolved yet, so bird flu is militarized. Remember foot and mouth? The first one came from a multi-national company that got full payback. The second time it came out, it turned out that it was from a government bioweapons lab and, a disease that the establishment could not control the first time suddenly went away after whistleblowers exposed it. Then we have farming, with GMO’s that kill rats when they eat it, the EU funding farmers to leave 20% of land fallow, forced to use much of the rest for bio-fuels, so, with land prices high, family farmers who actually know how to meet the needs of the community. So, we replace an independent farming system with orchards, market farming, etc. etc. with land for common grazing, land for grouse and game hunting. Look, the whole thing here, is that we are being attacked, because we are the opposition to the global socialist system.

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  • Anyway. Seeing as they’re not lending to each other, perhaps the banks should do something else – diversification …

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  • The government didn’t attach any performance expectation indicators to the bailout, e.g. “We expect the Libor rate to fall by x within y days” or “we expect rates on tracker or whatever mortgages to fall to z within y days”. This alone is an indication that it chose the package and £ numbers at random and on the basis “we’ve got to do something FFS”

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  • p4ac, none of what you said in the last two paragraphs follows any logic whatsoever. Even a casual glance at what you’ve said reveals that you are trying to shoehorn unconnected events and things you don’t like into your vision of what’s happening.

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  • planning4acrash says:

    shipbuilder, just because you don’t share or can’t perceive my logic, doesn’t necessarily mean that all, or part of it isn’t logical and true. Do you have any specific questions about what I’ve said?

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  • p4ac – food and drink are adulterated, farmland and fisheries industrialised and spoiled, because it’s profitable to do so, not because ‘they’ want to kill us off. Some of the things you mention will kill ‘them’ off as well as ‘us’.

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  • p4ac, i’m afraid logic isn’t an individual charcteristic. You claim that the elite are relying on technology but at the same time are trying to suppress technology and have us all living in the dark ages again. That private business is great, but that privately owned corporations, a natural conclusion to private industry, are evil. Is every corporation evil?
    Big government is bad, but a privately owned banking system is evil. Doesn’t make sense.
    Seemingly the elite’s plan had been to design and put in place an unsustainable monetary system based on growth, the very thing that has promoted world population growth, yet now they want to spend a fortune killing off the population in the slowest and most inefficient way possible. Reducing the population using the means you describe will not achieve the desired effect in the elite’s individual lifetimes – doesn’t make sense. Reducing the amount of the very thing that you need to keep your growth-based money system going doesn’t make sense either.
    I’d like to hear your views on the health system – privately owned as in the US or nationalised as in the rest of the world? Which one is designed by the elite? Or perhaps it is both? Do the elite control China, or the US, or Russia, or all of them? What about the likes of Chavez? Hero or despot?
    The final and most ridiculous claim, is that every single thing happening on the planet now is controlled by this elite, that every event of the past two weeks (indeed the past few centuries) has been carefully choreographed with an inevitable designed conclusion. Yet you say it won’t work because of fundamental flaws in their plan. So…..it’s worked perfectly so far because of their dastardly evil cleverness, but suddenly, when it all comes to a head, the most important part will fail because of a few simple mistakes?
    Really, I can go on all day here.

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  • Absolutely, icarus. There is no plan, just an understanding (that everyone seemingly agrees with) that profit is all.

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  • p4ac – from Wiki on paranoia –

    “Therefore, in common usage, the term paranoid addresses a range of mental conditions, assumed by the use of the term to be of psychiatric origin, in which the subject is seen to generalise or project fears and anxieties onto the external world, particularly in the form of organised behaviour focused on them. The syndrome is applied equally to powerful people like executives obsessed with takeover bids or political leaders convinced of plots against them, and to common people who believe for instance that shadowy agencies are operating against them.”

    Or perhaps the person who wrote this is ‘Common Purpose’……?

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  • planning4acrash says:

    Read Tragedy and Hope by Carol Quigley. There has always been an elite throughout time, to ignore that is to ignore that Paulston owns millions in Goldman Sachs and that Hitler was a supremacist.

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  • planning4acrash says:

    They clearly have their agenda, this is what I have been led to believe their agenda is. The agenda is clearly corporate socialism, and to achieve that, they clearly have to suppress the people. Now, I know what you said about technology, but, certain technology is needed to enslave us, like an internet to track everything and research human behavior, but others would empower us. Some do both.

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  • p4ac. Of course there’s always been an ‘elite’. Our society has always had a ruling class. Evidently you’ve ignored every post i’ve made over the past 6 months here. The existence of a powerful and self-interested number of people at the top of the tree is not in question, it’s obvious.
    What is in question is that the elite are organised into a single body, with ranks and plans and all that other cr*p and are responsible for all that you say they are.
    A healthy cynicism is where you accept that some bad things just happen, while others are planned. Where cynicism turns into paranoia is when you start believing that a single group are behind everything that happens, without exception.

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  • Quigley doesn’t say they’re trying to kill us off. He tried to prove the existence of an elite without ever penetrating its operations or specifying how it manipulated specific events. He relied mainly on government sources, quite possibly vetted. If you want works on the operations of an elite you’d do better to read Anthony C Sutton, Jules Archer, William Domhoff and a few others.

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  • Corporate socialism is an oxymoron. Corporatism is an inevitable consequence of the combination of a free market and human behaviour. It happened before fiat money and it will happen after. Watch ‘the corporation’. Whether we opt for a free market or socialism, there will be those who seek to take power and will succeed because we let them. We let them because people choose individualism and selfishness. It’s always been the way, the change is only within ourselves.

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  • markets freezing because no one has any true idea of the huge scale of the size of the toxic assets at this stage. The banks however due to there trading activities probably have a better idea than the government. The true scale of the losses to come will prove to be so huge the size of the governments intervention will be just a small drop in ahuge ocean. the governments dont have the size of funds available.
    The only partial action left will be to suspend market activity, which will help some aspects of the financial system but will crucify others ie cant see that doing the housing market much good.

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  • Why is the word “aggressive” used so much? It’s used increasingly in all sorts of contexts, as if it’s a good thing. Don’t know about you but I was always brought up being told that aggression was a bad thing.

    As in, “The rate at which banks lend to each other has risen despite aggressive measures from governments worldwide to tackle the credit freeze.”

    Why the need for this macho language? Is it trickle-down from the world of banking and finance, where “masters of the universe” do everything “aggressively”, or consultant-speak?

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  • @ shipbuilder

    Corporatism is categorically /not/ an inevitable consequence of a free market and human behaviour. A corporatist system does NOT have many free markets. They are distorted by the corporations and a distorted market is not free. You may have meant “under-regulated market” – then you would have been correct.

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