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China Reportedly Deployed Tanks to Protect Banks that Froze Depositors’ Funds

China is trying to ease panic over two of the biggest issues threatening social stability in the country—mortgage boycotts and frozen bank accounts. The China Banking and Insurance Regulatory Commission urged banks to increase loan support for real estate developers so they can complete unfinished projects, as thousands of disgruntled home buyers, who pay for homes before they are completed, are staging a mortgage boycott across the country. Locals from Henan claim they have not been able to take any money out from local banks since April. Tanks were reportedly deployed to protect banks that have frozen funds and an announcement by the Henan branch of the Bank of China that savings of depositors in their branch are “investment products” and cannot be withdrawn. According to the India TImes, almost every successful real estate developer is the white glove of powerful families of the Chinese Communist Party (CPC) elite.

UPDATE:  The video and report that a bank declared that depositors’ funds were “investment products” and that tanks mustered in front of a bank in Henan has yet to be confirmed by  a major mainstream media outlet. Newsweek published an article on Thursday and their research suggests that the footage with the tanks was not in fact shot in Henan, but at another location in Shandong province and a journalist for Shanghai Dail reported that the presence of the tanks was “just a standard training exercise.”

China is trying to ease panic over two of the biggest issues threatening social stability in the country—mortgage boycotts and frozen bank accounts.

On Sunday, the China Banking and Insurance Regulatory Commission urged banks to increase loan support for real estate developers so they can complete unfinished projects, as thousands of disgruntled homebuyers are staging a mortgage boycott across the country.
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In China, real estate firms are allowed to sell homes before completing them, and customers have to start repaying mortgages before they are in possession of the new property. These funds are used to finance construction by the developers.
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The payment boycott comes as a growing number of projects have been delayed or stalled by a cash crunch among property developers. Evergrande defaulted on its debt last year, and several other companies are seeking protection from creditors.
Home prices are also falling, putting some buyers underwater: They may be locked into a property that is now worth less than they agreed to pay, making them anguished about meeting their mortgage payments.

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Murder of a Rebel Nation: The Real Coup D’Etat in America Was Financial, Not Military

Patent attorney John Titus explains how Wall Street and banks caused the financial crisis in 2008 using bundled mortgage-backed securities as fraudulent collateral. He said that it was actually a coup d’etat against America and is treason. Alan Greenspan spilled the beans in a 2011 interview and admitted that there was rampant fraud and criminal activity on Wall Street, and that existing laws were violated and need to be enforced.

Summary by JW WIlliams

Patent attorney John Titus explains how Wall Street and banks caused the financial crisis in 2008 using bundled mortgage-backed securities as fraudulent collateral. He said that it was actually a coup d’etat against America and is treason.

In 2012, former President Obama tried to explain why not a single bank or Wall Street executive had been prosecuted when he claimed that some of the behavior on Wall Street was not illegal, so laws had to be changed, but this was a lie.

Titus explained that money is created when banks lend, but banks only lend against collateral as secured debt. He said that 5,000 mortgages worth $200,000 each created $1 billion in new money, but that money rested on zero collateral and coke dust. He said that the entire global crisis was caused by collateral fraud and insiders were well aware of the scheme. Alan Greenspan spilled the beans in a 2011 interview and admitted that there was rampant fraud and criminal activity on Wall Street, and that existing laws were violated and need to be enforced.

Titus said that former Attorney General Eric Holder and former Associate Attorney General Lanny Breuer were installed in top positions to prevent prosecution of bankers. Both were recruited from Covington and Burling law firm that represented the Big Banks.




Uganda Says It Discovered $12 Trillion in Massive Gold Deposits

Uganda announced the discovery of a deposit of 31 million tonnes of gold ore. Critics said that a great deal of gold ore is required to produce a single gram of refined gold and Uganda’s mines are estimated to generate about 217 metric tons of refined gold. The addition of 217 metric tons would raise the world’s “above-ground” refined gold stock by only about one-tenth of one per cent. The estimated world reserves of gold were about 53,000 tonnes of metal content. The gold reserves are mainly located in Australia (10,000 tonnes), Russia (7500 tonnes), the USA (3000 tonnes), South Africa (2700 tonnes), Peru (2700 tonnes), Indonesia (2600 tonnes), and Brazil (2400 tonnes). The Ugandan government has already licensed the Chinese firm Wagagai Gold Mining Company to start production.

The African country of Uganda is in the limelight again, and this time it is literally shining gold. The country has recently announced the discovery of a deposit of 31 million tonnes of gold ore, with extractable pure gold estimated to gross 320,000 tonnes.

Over the last two years, aerial exploration was done across the country, followed by geophysical and geochemical surveys and analyses, Solomon Muyita, spokesperson for the Ministry of Energy and Mineral Development, told Reuters. The government has expressed its intention to attract big investors to develop the Sector hitherto dominated by small wildcat miners.

We explain what the discovery entails for the global Gold market.

What makes Gold valuable?

Gold is a bright, slightly reddish yellow, dense, soft, malleable and ductile metal in its purest form. It is one of the least reactive chemical elements and is solid under standard conditions. Gold is resistant to corrosion and most acids and has unique properties distinct from other metals.

Another reason gold works well in terms of value is that gold does not readily oxidize. Thus, it maintains a constant weight. Other metals, such as iron rusts and copper, get oxidized. Here gold is rare, has a fairly stable volume and doesn’t rust away.

What are the typical uses of gold?

The prime characteristics of being corrosion-resistant and easy -to -work renders gold highly desirable for various purposes, such as decoration. The Industrial demand, especially in the electrical Sector for gold, is mainly due to excellent thermal and electrical properties.

Most of the gold fabricated today goes into the manufacture of jewellery. Still, gold is also an essential industrial metal that performs critical functions in computers, communications equipment, spacecraft, jet aircraft engines, and a host of other products.

Besides, a significant amount is consumed in dentistry and medicine. Continuing research has discovered new applications for gold as a catalyst and in nanotechnology.

Is gold scarce?

Gold often occurs in free elemental (native) form, as nuggets or grains, in rocks, veins, and alluvial deposits. However, gold is not a rare metal. Still, it’s difficult and expensive to find and extract the same in large quantities – it is rarely found in concentrations that make extraction economically viable.

Gold explorers conduct geological surveys to support a profitable mining project targeting concentration levels that are 1,000 times higher than normal. It can typically take between 10 and 20 years after a deposit is discovered before a gold mine is ready to produce material that can be refined into bullion.

How is gold mined?

Gold mine exploration is challenging and complex. It requires significant time, financial resources and expertise in many disciplines – e.g. geography, geology, chemistry and engineering.

The likelihood of a discovery leading to a mine being developed is very low – less than 0.1 per cent of prospected sites will lead to a productive mine. And only 10 per cent of global gold deposits contain sufficient gold to justify further development.

The development of the mine is the next stage of the gold mining process, which involves planning and construction of the mine and associated infrastructure. It generally takes several years, although this varies greatly depending on location.

The gold mining operation stage represents the productive life of a gold mine, during which ore is extracted and processed into gold. Processing gold involves transforming rock and ore into a metallic alloy of substantial purity – known as doré – typically containing between 60-90 per cent gold. Once the gold is purified, it is smelted and pressed into gold bars to be sold in the market.

What is the status of global Gold Reserves?

According to Mineral Commodity Summaries, 2021 by the United States Geological Survey (USGS), the estimated world reserves of gold were about 53,000 tonnes of metal content.

The gold reserves are mainly located in Australia (10,000 tonnes), Russia (7500 tonnes), the USA (3000 tonnes), South Africa (2700 tonnes), Peru (2700 tonnes), Indonesia (2600 tonnes), and Brazil (2400 tonnes).

How is Global Gold supply ensured?

The total world gold supply comes from mining and recycling above-ground gold stocks.

Mine production accounts for the largest part of gold supply – 75 per cent each year. The world mine production of gold was estimated at 3,350 tonnes in 2019 compared to the 3,470 tonnes in the preceding year. The top five leading gold-producing countries were China, Australia, Russia, USA and Canada.

Currently, about 90 countries mine gold, of which there are just seven major players. China has been the largest gold producer in the world, accounting for around 11 per cent of total annual production. But no one region dominates. The other major countries are Australia (10 per cent), Russia (9 per cent), the USA (6 per cent), Canada (5 per cent), Ghana & Peru (4 per cent each) and Mexico & Indonesia (3 per cent each). India’s share in the global gold production is less than 0.05 per cent.

As it is virtually indestructible, nearly all of the gold ever mined is theoretically still accessible in one form or another and potentially available for recycling. The majority of recycled gold, about 90 per cent, is extracted from high-value gold jewellery and 10 per cent from industrial gold.

From where demand for gold comes?

Gold is bought worldwide for multiple purposes – as a luxury good, a component in high-end electronics, a safe-haven investment, or a portfolio diversifier. It covers jewellery fabrication (~34 per cent), technology and industrial purpose (~7 per cent), investments in financial products like ETFs backed by gold and other physical gold investments (~42 per cent) and those held by central banks (~17 per cent).

Gold demand is geographically diverse, but 72 per cent comes from emerging markets, with China and India representing 50 per cent of all demand. While China accounts for around 28 per cent of the global demand, India’s demand accounted for around 22 per cent.

However, as India has little domestic supply of gold, imports primarily satisfy demand. The cost of these imports is partially responsible for today’s current account deficit (CAD). Gold supply in India is primarily met through imports, with less than 1 per cent coming from local mining and about 10 per cent from recycling.

So, how Uganda stumbled upon the vast gold reserves?

Over the last two years, the East African country commissioned aerial exploration across the country, followed by geophysical and geochemical surveys and analyses. The gold can be mined with immediate effect. The government now looks forward to attracting gold miners and investors.

The move follows President Yoweri Museveni’s government’s attempts to ramp up investment in mining to develop resources like copper, iron ore, gold, cobalt, and phosphates.

Most of the deposits were discovered in Karamoja, a parched sprawling area in the country’s northeastern corner on the border with Kenya. Large reserves were also found in the country’s eastern, central, and western regions. According to the Ugandan government, the value of 31 million tonnes of gold ore stands at $12.8 trillion.

Are the numbers plausible?

As mentioned, the numbers put out by the Ugandan mining ministry drew some scepticism. A great deal of gold ore is required to produce a single gram of refined gold.

Typically, a high-quality underground gold mine will yield 8 to 10 grams of refined gold per metric ton of gold ore, according to the World Gold Council (WGC), while a marginal quality mine generates 4 to 6 grams per metric ton.

Suppose one settles on a rough average of 7 grams of refined gold per metric ton of gold ore. This means Uganda’s mines will generate about 217 metric tons of refined gold, a far cry from the 320,158 metric tons of refined gold that the Ugandan Government told the country’s new discovery could produce Reuters. The addition of 217 metric tons would raise the world’s “above-ground” refined gold stock by only about one-tenth of one per cent.

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Biden Regime Admits Ushering In ‘Liberal World Order’ Is More Important than Affordable Gas

Last week, President Biden’s director of the National Economic Council, Brian Deese, when queried about high gas prices that have been linked to the war in Ukraine, said, “What you heard from the president today was a clear articulation of the stakes. This is about the future of the liberal world order and we have to stand firm,” referring to Biden’s commitment to the war in Ukraine, no matter the cost to Americans. His statement shows that high gas prices are a part of the plan.

The Biden White House admitted on Thursday that record-high gas prices are part of a broader scheme to usher in the “liberal world order” at Americans’ expense.

On CNN, Biden’s director of the National Economic Council, Brian Deese, made clear that high gas prices are a part of the plan, as the administration promotes prohibitively expensive electric vehicles to struggling consumers.

“What do you say to those families who say, ‘Listen, we can’t afford to pay $4.85 a gallon for months if not years. It’s just not sustainable’?” the CNN host asked.

“What you heard from the president today was a clear articulation of the stakes,” Deese said. “This is about the future of the liberal world order and we have to stand firm.”

Deese was referring to Joe Biden’s comments at the NATO summit in Madrid, after one reporter asked the president, “How long is it fair to expect American drivers and drivers around the world to pay that premium for this war?” in reference to the ongoing conflict in Ukraine, which only spiked prices that were already elevated long before the war started.

“As long as it takes,” Biden said.

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The Federal Reserve Raises Interest Rates as Inflation Soars

As food, gasoline and and utilities continue to rise, the Federal Reserve recently boosted interest rates by 0.75 percentage points to ostensibly tame soaring inflation by making it more difficult to borrow and buy things like homes and cars. More than 8 million American renters, which amounts to 15% of renters, are late on paying their rent after getting deferrals due to COVID in 2020. Mortgage rates have already surged in response to the Fed’s rate increases this year. The average 30-year mortgage stood at 5.23% on June 9, according to Freddie Mac. That’s up from 2.96% a year earlier. Higher interest rates have raised payments on medium-priced homes by over $600 a month. Average credit card interest rates have topped 20%. The Federal Reserve is the cause of the problems and intends to raise rates again by .75 points again in July.

Earlier this year, the Federal Reserve turned to its most potent weapon — raising interest rates — to combat soaring inflation. But with consumer prices having only accelerated since then, the central bank boosted rates by 0.75 percentage point on Wednesday — its largest hike since 1994 — to try to tame the nation’s fiercest bout with inflation in 40 years.

The rate hike follows the announcements of a 0.25 percentage point hike in March and a 0.5 percentage point move in May — with the latter marking the sharpest increase since 2000.

The Fed had earlier been expected to boost rates by a more modest 0.5 percentage point, but the bank opted for a larger hike after the Consumer Price Index, a broad basket of goods and services used to track inflation, surged 8.6% in May, from an 8.3% annual rate in April. Gasoline prices have continued to hit new highs almost daily amid depleted domestic production and Russia’s war in Ukraine, while food and housing costs are also surging.

The idea behind the Fed’s rate hike is to make it costlier to borrow money, which in theory should tamp demand for purchases that require borrowing, like home buying or buying items with credit cards. With the latest rate increase, consumers and businesses should brace themselves for a hit to their wallet, experts say.

“The cost of borrowing is becoming more expensive, particularly for those with variable rate products,” said Mark Hamrick, senior economic analyst at Bankrate. “Fortunately, on the other side of the rate equation, returns on savings will likely be improving, particularly for those who investigate more generous high-yield savings options.”

By year-end, the federal funds rate — the rate that determines borrowing between banks — could be almost twice as high as its pre-pandemic level of about 2%, according to forecasts.

“It was just a few weeks ago that investors were forecasting the funds rate to be ~2.58% at the end of this year, but that number is now more than 100 [basis points] higher at 3.7%,” analyst Adam Crisafulli of Vital Knowledge told clients in a research note. “And the ‘terminal’ funds rate (the level at which the Fed will stop hiking this cycle) is now seen north of 4%.”

Here’s what the Fed jacking up interest rates could mean for your wallet.

What will the rate hike cost you?

Every 0.25 percentage point increase in the Fed’s benchmark interest rate translates to an extra $25 a year in interest on $10,000 in debt. So Wednesday’s 0.75 percentage point increase means an extra $75 of interest for every $10,000 in debt.

Economists expect the Fed will continue to raise rates throughout the year as it battles inflation. Some analysts now forecast the central bank will announce another 0.75 percentage point increase in July, followed by two 0.5 percentage point hikes in September and November.

By early 2023, the federal funds rate could be 3.75% to 4%, according to TD Macro. That implies a rate increase of at least 2.75 percentage points higher than the current federal funds rate of 1%. For consumers, that means they could pay an additional $275 in interest for every $10,000 in debt.

How could it impact the stock market?

The stock market has slumped this year amid various headwinds, including the impact of high inflation and the Fed’s monetary tightening. But a bigger-than-expected interest rate increase on Wednesday “could be welcomed by stocks,” Crisafulli said before the rate hike was announced.

“It would represent a powerful signal by [Fed Chair Jerome Powell], help the Fed recapture control of the policy narrative and clamp down on the massive change in tightening forecasts,” he noted.

The S&P 500 rose 15 points, or 0.4%, to 3,750 on Wednesday.

Credit cards, home equity lines of credit

Credit card debt will become more expensive, with higher APRs hitting borrowers within one or two billing cycles after the Fed’s announcement, according to LendingTree credit expert Matt Schulz. For instance, after the Fed’s March hike, interest rates for credit cards increased for three-quarters of the 200 cards that Schulz reviews every month.

Consumers with balances may want to consider a 0% balance transfer credit card or a low-interest personal loan, Schulz said. Consumers can also ask their credit card companies for a lower rate, which research has shown is frequently successful.

Credit with adjustable rates may also see an impact, including home equity lines of credit and adjustable-rate mortgages, which are based on the prime rate.

What’s the impact on mortgage rates?

Mortgage rates have already surged in response to the Fed’s rate increases this year. The average 30-year mortgage stood at 5.23% on June 9, according to Freddie Mac. That’s up from 2.96% a year earlier.

That is adding thousands to the annual cost of buying a property. For instance, a purchaser buying a $250,000 home with a 30-year fixed loan would pay about $3,600 more per year compared with what they would have paid a year earlier.

The Fed’s newest rate hike might already be baked into current mortgage rates, said Jacob Channel, senior economic analyst for LendingTree, in an email.

“The Fed’s rate hike may not mean that mortgage rates are going to significantly increase,” he noted.

The housing market reflects one part of the economy where the Fed’s rate increases are slowing demand. Channel added: “These high rates have significantly dampened borrower desire to refinance current loans, and they’re also showing signs of reducing demand for purchase mortgages as well.”

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Cryptocurrencies Crash and Bitcoin Has Lost 70% of Its Value Since November

Major cryptocurrency exchanges like Celsius and Binance froze withdrawal transactions due to “extreme market conditions,” prompting a massive sell-off in the crypto space that resulted in a $500 billion being wiped from the market. Almost every top coin is now worth half or even less than their all-time highs. Bitcoin has dipped below $21,000 and its price is down nearly 70% from its all-time high of $69,000 last November. The immediate trigger for the crypto crash appears to be a massive sell-off by investors panicked by inflation of food, gas and energy prices as a recession looms. Investors are continuing to stay away from riskier assets and the stock market is also plummeting. The Dow Jones Industrial Average closed 876 points lower, while the S&P 500 pulled back 20% from its all-time high, marking the steepest 3-day trading decline of 2022.

Why is crypto crashing today? Cryptocurrency markets have crashed to a new low of this year today (13th June, 2022). The global market cap has shrunk below $1 trillion to $977 billion, around 12 % fall since yesterday. The global cryptocurrency market cap has fallen by around $1 trillion this year while almost every top coin is now worth half or even less than their all-time highs.

The immediate trigger for the crypto crash appears to be a massive sell-off by investors amid heightened inflation fears and pausing of withdrawal by crypto lending service Celsius. Investors are also continuing to stay away from riskier assets, which is reflecting in the stock markets as well.

Bitcoin, the biggest and most popular cryptocurrency, has fallen below $22,000 while almost all altcoins, starting from Ethereum, are bleeding prices since weekend.

Ethereum has fallen to its lowest level in more than 14 months, trading around $1155. Solana has fallen by more than 15% and is hovering around the $27 mark, according to CoinMarketCap data at the time of writing.

Experts say that the crypto price plunge indicate a falling risk appetite of investors. They are clearly wary of risky assets. With all its uncertainties and volatilities, crypto is considered as one of the most volatile instruments for investment purpose.

“The crypto market has been under pressure from the Federal Reserve, hiking the interest rates to combat inflation over the past few months. Bitcoin, Ethereum, and most cryptocurrencies suffered losses over the weekend after a broad sell-off following the data showing US inflation hitting a 40-year high,” said Edul Patel Co-Founder and CEO of crypto investment platform Mudrex.

“As investors seem to have panicked, the number of crypto liquidations has been high since Friday. Bitcoin and Ethereum plummeted as much as 7% each and are currently trading at their lowest at US$25,000 and US$1,300. The bearish trend may likely continue in the next coming days,” he added.

While altcoins have historically underperformed Bitcoin, this time they have an added pressure of potential regulatory roadblocks. A report by CoinDesk quoted an expert as saying that only a small number of altcoins are likely to survive such market movements.

Shivam Thakral, CEO of crypto exchange BuyUcoin said that the rising food, gas, and energy prices are putting tremendous pressure on the crypto market as Bitcoin and Ether have witnessed double-digit losses in the past 24 hours.

“After the consumer price index reported the highest inflation since 1981, financial markets across the globe have seen a sharp downturn,” said Thakral.

“The market is expected to remain choppy in the coming weeks and countries around the globe continue to report high inflation numbers. The current dip in the crypto prices allows investors to buy crypto at 2021 prices and we expect the seasoned investors to take advantage of the dip,” he added.

According to Darshan Bathija, CEO of crypto exchange Vauld, most investors worry that unless inflation numbers start dropping soon, the US Fed may have to tighten reigns by increasing interest rates at a faster pace than anticipated

Read full article here…

NY Post:   https://nypost.com/2022/06/14/crypto-crash-continues-as-bitcoin-briefly-dips-below-21k/




“Somebody’s On Path To Destruct America,” Warns US Oil Billionaire

New York billionaire and refiner John Catsimatidis warned that soaring fuel prices and rising interest rates could devastate the US economy. Last month he warned that the diesel shortage could spur fuel rationing this summer. He said that the Biden administration’s policies are the problem and that “We have 100 years’ worth of oil [in the US]. Let them [the government] open up the spigots and the price of crude oil will come back down to $55, $60, maybe $65 – half.” He said that raising the interest rates will wipe out the real estate industry and everything else in America! Catsimatidis explained that 70% of all transportation to grocery stores across the country are made by diesel trucks which has doubled and is going higher, which means that food prices will rise. Biden, on his first day in office, shut down the Keystone pipeline.

New York billionaire and refiner John Catsimatidis is out with a new warning that soaring fuel prices and rising interest rates could produce a hard landing for the US economy. Catsimatidis warned last month about the diesel shortage on the East Coast, even suggesting the fuel could “be rationed this summer.”

Catsimatidis told Fox Business’ Dagen McDowell that the fuel crisis “will get worse” and said the Biden administration is steering the economy on a path towards recession, indicating this downturn doesn’t need to happen.

Biden’s “obsession” against “turning on North American oil spigots” has skyrocketed energy costs and inflation, he said, adding that the president has been begging Saudi Arabia and other countries for more crude production instead of increasing domestic production.

“We have 100 years’ worth of oil [in the US]. Let them [the government] open up the spigots and the price of crude oil will come back down to $55, $60, maybe $65 – half”, Catsimatidis said. 

He explained it makes absolutely “no sense” to beg Saudi Arabia for crude at $120/bbl. He called on the president to increase domestic drilling.

“[Biden] wants to fly to Saudi Arabia and beg the Saudi Arabians to give us another half a million barrels at $120 a barrel… It makes no sense,” he added. 

Catsimatidis spoke with McDowell on Monday as the national gasoline average at the pump inched closer to $5 a gallon.

Read full article here…




JPMorgan Chase CEO Jamie Dimon Predicts “Hurricane” Will Strike Economy

JPMorgan Chase boss Jamie Dimon urged investors to prepare themselves for turbulence in the market in the weeks ahead – and warned them to brace themselves for a “hurricane” in the economy. Dimon blamed Russian invasion of the Ukraine and the Federal Reserve’s move to tighten monetary policy instead of the corrupt policies of the Federal Reserve and banks. The Federal Reserve is set to begin shedding its nearly $9 trillion in bond holdings this month in a process known as “quantitative tightening.” The Fed is cutting off the pandemic-era flow of cheap money and tightening credit; investors fear it will result in a recession. The bad policies and disruption have been planned, they are not mistakes.

JPMorgan Chase boss Jamie Dimon urged investors Wednesday to prepare themselves for turbulence in the market in the weeks ahead – warning that extraordinary financial circumstances were creating a potential “hurricane” for the economy.

Dimon, the head of the largest US bank, said factors such as the Russian invasion of the Ukraine and the Federal Reserve’s move to tighten monetary policy due to decades-high inflation could stoke chaotic conditions in the market.

“It’s a hurricane. Right now, it’s kind of sunny, things are doing fine, everyone thinks the Fed can handle this,” Dimon said during a conference sponsored by AllianceBernstein, according to Bloomberg.

“That hurricane is right out there, down the road, coming our way,” he added. “We just don’t know if it’s a minor one or Superstorm Sandy or Andrew or something like that. You better brace yourself.”

The Federal Reserve is set to begin shedding its nearly $9 trillion in bond holdings this month in a process known as “quantitative tightening.” Central bank officials are also expected to enact another half-percentage point interest rate at their meeting later this month.

Read full article here…

ZeroHedge:   https://www.zerohedge.com/markets/its-unprecedented-goldman-president-echoes-dimons-hurricane-warning




The “Devastating Consequences” to the Economy Presented by Central Bank Digital Currency (CBDC)

Credit union and banking trade groups have released a joint letter to the House Financial Services Committee warning of “devastating consequences” if the Federal Reserve moves forward with a Central Bank Digital Currency (CBDC) because it would allow the Federal Reserve to compete for deposits against credit unions and banks. Essentially, introduction of CBDC would result in the savings of businesses and consumers to shift away from funding the assets of banks through loans, and instead would fund the assets of the Federal Reserve, such as Fannie Mae and Freddie Mac. Money deposited into accounts at the Federal Reserve cannot be lent back into the economy and credit availability will be severely restricted, causing a slowdown of the economy. Digital currency is inefficient and expensive to implement.

The Federal Reserve (Fed) was presented with a proposal to restructure by moving all commercial bank deposits to so-called FedAccounts, allowing the Fed to confiscate deposits from these FedAccounts in order to tighten monetary policy, allowing the New York Fed to short securities, eliminate the Federal Deposit Insurance Corporation (FDIC), and consolidate all bank regulatory functions under one federal agency.

Credit union and banking trade groups have released a joint letter to the chair and ranking member of the House Financial Services Committee, warning of “devastating consequences” if the Federal Reserve moves forward with a Central Bank Digital Currency (CBDC). The letter was sent on May 25, one day before the Committee convened a hearing on “Digital Assets and the Future of Finance: Examining the Benefits and Risks of a U.S. Central Bank Digital Currency.” That hearing took testimony from only one witness, Lael Brainard, the Vice Chair of the Federal Reserve.

The fact that credit unions, which frequently serve unionized labor, joined with banking trade groups to sign off on the letter, lends credibility to the “devastating consequences” the letter enumerates of a Central Bank Digital Currency.

A CBDC would allow the Federal Reserve to compete for deposits with credit unions and banks. The letter correctly assesses the downside of such a move as follows:

“Private money is created through financial intermediation by banks and credit unions– the process in which financial institutions take deposits and lend out and invest those deposits. Private money is used by financial institutions to provide funding for businesses and consumers and thus supports economic growth. Introducing a CBDC would be a deliberate decision to shift some volume of private money to public money, with potentially devastating consequences for the cost and availability of credit for consumers and businesses. In sum, the savings of businesses and consumers would no longer fund the assets of banks – primarily, loans – but instead would fund the assets of the Federal Reserve – primarily securities issued by the Treasury Department, Fannie Mae, and Freddie Mac.”

In a similar vein, the letter warns:

“In effect, a CBDC will serve as an advantaged competitor to retail bank deposits that will move money away from banks and into accounts at the Federal Reserve where the funds cannot be lent back into the economy. These deposit accounts represent 71% of bank funding today. Losing this critical funding source would undermine the economics of the banking business model, severely restricting credit availability, increasing the cost of credit, and causing a slowdown of the economy. ABA estimates that even a CBDC where accounts were capped at $5,000 per ‘end user’ could result in $720 billion in deposits leaving the banking system.”

The joint letter also calls out the absurdity that the dollar is not already digitized. (Anyone who uses a “pay by phone” method to pay a monthly bill in seconds from their checking account or a debit card to pay for purchases fully appreciates how rapid and streamlined the digital dollar already is.) The credit unions and banking groups write as follows:

“Contrary to the assertions of some CBDC proponents, a U.S. CBDC is not necessary to ‘digitize the dollar,’ as the dollar functions primarily in digital form today. Commercial bank money is a digital dollar, and is currently accepted without question by businesses and consumers as a means of payment.”

In July 2019, NYU Professor and economist Nouriel Roubini also touched on the existing speed of the Visa credit card system versus digital currency in a Bloomberg News interview. Roubini stated:

“…nobody, not even this blockchain conference, accepts Bitcoin for paying for conference fees cause you can do only five transactions per second with Bitcoin. With the Visa system you can do 25,000 transactions per second…Crypto’s nonsense. It’s a failure. Nobody’s using it for any transactions.”

One of the key concerns in Congress and at the Fed appears to be that another country, such as China, might get ahead of the U.S. in the development of their own Central Bank Digital Currency and endanger the U.S. dollar as the world’s reserve currency. At the House Financial Services Committee hearing on May 26, Fed Vice Chair Brainard testified as follows:

“The future evolution of international payments and capital flows will also influence considerations surrounding a potential U.S. CBDC. The dollar is the most widely used currency in international payments and investments, which benefits the United States by reducing transaction and borrowing costs for U.S. households, businesses, and government. In future states where other major foreign currencies are issued in CBDC form, it is prudent to consider how the potential absence or presence of a U.S. central bank digital dollar could affect the use of the dollar in global payments. For example, the People’s Bank of China has been piloting the digital yuan, and several other foreign central banks are issuing or considering issuing their own digital currencies. A U.S. CBDC may be one potential way to ensure that people around the world who use the dollar can continue to rely on the strength and safety of the U.S. currency to transact and conduct business in the digital financial system. More broadly, it is important for the United States to play a lead role in the development of standards governing international digital finance transactions involving CBDCs consistent with the norms of privacy, accessibility, interoperability, and security.”

The credit unions and banking groups’ joint letter addressed that issue as follows:

“…a CBDC does not appear to be necessary to support the role of the U.S. dollar internationally. While many countries have experimented with a CBDC, many have focused on a wholesale model, something not contemplated by the Federal Reserve’s discussion paper. In addition, many have pulled these experiments back as the costs of implementation have become apparent. The Federal Reserve notes that the dollar’s status as the global reserve currency is driven by 1) the strength and openness of our economy, 2) the depth of our financial markets, and 3) the trust in our institutions and rule of law.”

Wall Street On Parade has been skeptical of the invisible hand(s) behind this push for a Central Bank Digital Currency at the Fed – (the Fed being the perpetual provider of bailouts to Wall Street’s casino banks) – ever since a similar invisible hand pushed Saule Omarova forward as President Biden’s nominee to head the Office of the Comptroller of the Currency, the regulator of national banks (those that operate across state lines).

In October of last year, the Vanderbilt Law Review published a 69-page paper by Omarova in which she proposed not just a Central Bank Digital Currency but a hair-raising, radical restructuring of the Fed that would include the following:

(1) Move all commercial bank deposits from commercial banks to so-called FedAccounts at the Federal Reserve;

(2) Allow the Fed, in “extreme and rare circumstances, when the Fed is unable to control inflation by raising interest rates,” to confiscate deposits from these FedAccounts in order to tighten monetary policy;

(3) Allow the most Wall Street-conflicted regional Fed bank in the country, the New York Fed, when there are “rises in market value at rates suggestive of a bubble trend,” such as with technology stocks today, to “short these securities, thereby putting downward pressure on their prices”;

(4) Eliminate the Federal Deposit Insurance Corporation (FDIC) that insures bank deposits in the U.S. and that prevents panic runs on banks;

(5) Consolidate all bank regulatory functions at the OCC – which Omarova was nominated to head.

Read full article here…




Congress Passes $40 Billion Aid Bill to Ukraine, Total Spending to Reach $3 TRILLION

The US now in a proxy war against Russia and Congress passed the $40 billion Ukraine aid bill with zero oversight on spending, despite Senator Rand Paul’s effort to have an inspector general scrutinize the new spending. Tucker Carlson said that this is only the beginning and total spending could reach $3 TRILLION! Most of the money going to arms manufacturers. The total spending plan is not reported publicly, and is only spoken about in private conversations and deals. The public support for war with Russia is close zero.

Link for video:    https://lorphicweb.com/america-last-as-everyday-americans-struggle-the-biden-admin-is-prepared-to-spend-3t-to-defeat-russia/




Fraud: $163 BILLION in COVID Unemployment Funds Stolen

An estimated $163 billion in pandemic-related benefits were fraudulently obtained by criminals, according to the Labor Department. The Biden administration said that it inherited the problem and blamed out-of-date systems and the lack of state-by-state data sharing. Just $4.1 billion of that has been recovered, only 2.4% of the estimated stolen, raising concern the government is not going to get most of it back.

COVID-19 pandemic unemployment benefits wound up being a “a magnet for rip-off artists,” as identity thieves capitalized on rushed benefits the government was not geared up for in a pinch, The Washington Post reported Sunday.

An estimated $163 billion in pandemic-related benefits were fraudulently received, according to the Labor Department.

Just $4.1 billion of that has been recovered, only 2.4% of the estimated stolen, raising concern the government is not going to get most of it back.

“The unprecedented explosion of unemployment claims, combined with years of disinvestment in our unemployment system, lack of state-by-state data sharing and weak identity controls, created a perfect storm for the fraud and identity theft in 2020 that we inherited,” adviser to President Joe Biden, Gene Sperling, told the Post in a statement.

The level of fraud is so prevalent, the $163 billion might be on the low end, according to the report.

“It’s obviously substantial,” U.S. Secret Service’s Roy Dotson, the national pandemic fraud recovery coordinator, told the Post. “I can’t really get into the number.

“We’re all trying to figure that out.”

Read full article here…




Coinbase Crypto Exchange Is Warning Bankruptcy Could Wipe Out User Funds

Coinbase Global, the US’s largest cryptocurrency exchange that also has an investment wing, reported a quarterly loss of $430 million and a 19% drop in monthly users. In the event Coinbase goes bankrupt, it says its users would be considered to be “general unsecured creditors” and might lose all the cryptocurrency in their accounts if it is stored in a wallet controlled by the exchange company. Coinbase holds $256 billion in both fiat currencies and cryptocurrencies on behalf of its customers. Coinbase stock prices hit $429 per share on the day of its initial public offering just 13 months ago — it is now $53 per share. Cryptocurrencies have recently lost value under the threat of increased regulations.

Hidden away in Coinbase Global’s disappointing first-quarter earnings report—in which the U.S.’s largest cryptocurrency exchange reported a quarterly loss of $430 million and a 19% drop in monthly users—is an update on the risks of using Coinbase’s service that may come as a surprise to its millions of users.

In the event the crypto exchange goes bankrupt, Coinbase says, its users might lose all the cryptocurrency stored in their accounts too.

Coinbase said in its earnings report Tuesday that it holds $256 billion in both fiat currencies and cryptocurrencies on behalf of its customers. Yet the exchange noted that in the event it ever declared bankruptcy, “the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings.” Coinbase users would become “general unsecured creditors,” meaning they have no right to claim any specific property from the exchange in proceedings. Their funds would become inaccessible.

That shouldn’t happen.

An individual’s ownership of cryptocurrency is supposed to be immutable and absolute; that’s one of the key selling points touted by blockchain evangelists everywhere. But when a user creates a Coinbase account, they often end up storing their cryptocurrency in a wallet controlled by Coinbase, which means the individual is giving away at least part of their control over their own funds.

Access to a crypto wallet is governed by a private key, which is a long string of characters that effectively acts as a password. Without the key, the cryptocurrency in the wallet can’t be accessed. On Coinbase, the exchange holds the private key and lets users access the funds within the wallet using a more conventional password. The setup makes it easier for users to enter their accounts, by remembering an easier password.

Yet it means that when push comes to shove, Coinbase ultimately governs whether a user gets access to those assets.

Read full article here…

Entrepreneur:   https://entrepreneur-360.com/how-does-coinbase-make-money-15269

Yahoo:    https://www.yahoo.com/now/coinbase-loses-half-value-week-224343809.html