Bernanke is Man of the Hour: Inflation and the IMF Threats
At 2:15 p.m. ET, Ben Bernanke, chairman of the Federal Reserve, will make waves in the world of economists and Wall Streeters. For the first time in the 98-year history of the nation’s central bank, the chairman will talk to the press after an interest rate decision, fulfilling a promise he made at his first confirmation hearing back in 2005. (Source: ABC News)
Federal Reserve Shrugging Off IMF Insinuation
Sovereignty is the quality or authority of being independent and in charge of the conditions you live under.
Tea Partyiers are calling for the dissolution of the Fed — that is nothing new. Let me repeat: that is nothing new. John Birchers, Goldwater Republicans and Libertarians have been calling to end the Federal Reserve for decades. It is part of their return-to-the-gold-standard platform.
While many mainstream media reporters are stating Bernanke is speaking to everyday Americans about inflation here in the U.S., I believe he will be sending a strong message to the IMF — we control our monetary policy.
The Federal Reserve strengthens U.S. sovereignty and U.S. authority as it enables the United States to operate independently of global monetary policy makers. There is a fight going on right now between the IMF and the United States. The IMF wants to reduce the U.S. sovereignty by replacing the dollar as the world currency with SDRs, Special Drawing Rights. (see June 2010 Bloomberg excerpt below). Reducing U.S. sovereignty would undermine our authority around the world. For that reason, and that reason alone, I believe Bernanke will, through his well thought out comments, re-establish the authority of the United States today in his unprecedented press conference. He will through his comments assert the United States controls its monetary policy through the Federal Reserve. We will assert our authority and power through our currency and there is no way we are giving that authority up.
The U.S. is seen as weak right now and it’s enemies are looking at this as a prime opportunity to press agendas to further weaken the U.S. The IMF attack on the dollar is but one challenge we face. The other is the incessant call to return to the gold standard. Another is even coming from the left-wing as the Second Bretton Woods Summit was held earlier this month to discuss global governance of financial capitalism. No consensus came out of that summit.
In an article from Forbes we get a clearer view of where Soros stands: he wants more regulation of central banks as does Obama, and many Democrats to avoid another economic meltdown in the future.
Critics mistakenly argues “that Soros and well known economists like Joseph Stiglitz are calling for the dollar to be replaced as a world currency. That is false. They are saying that a weak dollar is forcing Central Banks around the world to turn to other currencies and hard assets because they are losing value on their dollar based assets. They are turning to the euro and to gold to build up reserves. But they are not doing this at a rate that puts the dollar under serious threat of being debased as the global reserve and trade currency of choice.”
In Kenneth Rapoza’s article he states” SDRs are light years away from ever becoming a tradable currency. Yes, they could become part of a Central Bank’s foreign reserves, but if they account for 10% of them in some countries, I’d be shocked. SDRs are used by IMF member nations to pay each other their IMF loans. Americans will not be going to ATM machines to withdraw SDRs with Soros and Obama’s pictures on them to buy bread in the socialist bread lines within –let’s put money on it — the life cycle of planet Earth.
I’ll be doing a followup after Bernanke speaks today.
I listened to a comprehensive report on inflation yesterday on Los Angeles 1070 radio Business Hour. Food – up; Gas – up; Retail goods – up; Gold continues to climb and now silver is surging; John Harris’s Summer of Rage is developing as predicted.
(SINGAPORE) Silver rallied to an all-time high as investors sought to protect their wealth against accelerating inflation and a weaker dollar with holdings in a metal that also benefits from economic growth. Spot gold also reached a record.
Immediate-delivery silver climbed as much as 5.4 per cent to US$49.79 per ounce, beating the previous peak, which according to research company GFMS Ltd was US$49.45 in 1980.
1980 was a particularly nasty year; Inflation in 1980 hovered between 13 and 14%. Credit card rates were very high; The Prime lending rate hit 21.50% in December 1980. These were very tough years for most Americans including myself as I was in my prime earning years and just could not get ahead. My best years, were the Clinton years, otherwise, it has been a battle to make a decent living. Now, we are in a similar situation, if not worse. Bernanke is really driving the bus now and I have every confidence in him that he will make astute decisions that will help the recovery long term, preserve our monetary authority, and strengthen our sovereignty.
Bloomberg June 6, 2010 -(Bloomberg) — The International Monetary Fund said it’s possible to take the “revolutionary” step of creating a new global reserve currency to replace the dollar over time.
The IMF’s so-called special drawing rights could be used as the basis for a new currency, First Deputy Managing Director John Lipsky told a panel discussing reserve currencies at the St. Petersburg International Economic Forum today.
“There are many, many attractions in the long run to such an outcome,” Lipsky told a panel discussing reserve currencies at the St. Petersburg International Economic Forum today. “But this is not a quick, short or easy decision,” he said, adding that it would be “quite revolutionary.”
The SDRs would have to be delinked from other currencies and issued by an international organization with equivalent authority to a central bank in order to become liquid enough to be used as a reserve, he said.
As much as 70 percent of the world’s currency reserves are held in dollars, according to the IMF, leading to calls for nations to diversify their cash piles to avoid excessive exposure to the U.S. economy as it quadruples its budget deficit in a bid to counter the worst recession since the Great Depression.
IMF Special Drawing Rights, click here
Forbes: Soros Bretton Woods Meeting Not So Scary, click here
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