When analyzing the Federal Reserve monetary expansions, pundits only assess economic issues like inflation, balance sheets, bubbles or public debt. Significant as they are, it will be very useful that all this smart people were added to the camp of those who want to “save the planet”. Let me to pin down it.
On January 27 OTC Derivatives Supervisors Group (ODSG) and major market participants met at the Federal Reserve Bank of New York to discuss how to improve infrastructures and reduce risks in derivatives markets, supporting G20 objectives. They agreed to set out those plans in a letter to the ODSG by March 31.
We will continue to focus on increasing standarization and transparency, as well as the further development and innovation of central clearing facilities to reduce counterparty credit risk. We must continue to advocate for solutions that will extend central clearing benefits to a broader set of participants in a safe and sound manner.
These are the words of Mr. William Dudley of the New York Fed. But before the letter reaches its destination, the President sould look this charts.
Direct relationship between OTC market growth, foreign purchases of US debt and China’s coal consumption is obvious. And of course also between the disorderly monetary expansion cheered by the Fed, american deficits, global imbalances and Asian country CO2 emissions. This chart is enough.
We are in luck, because ODSG wants to support “G20 objectives” and we can read the notes of an attendee of the 2010 G20 meeting. According to the documents, the delegates concluded that a process of fiscal consolidation would be the key solution to the crisis, involving country-specific ideas with central coordination. Although the delegates evidently discussed the need to address the sovereign debt crisis “through cutting expenses and not through increased taxes”, that statement is immediately followed in this attendee’s notes by the idea of introducing carbon taxes.
I have never bought “save the planet” lema, because to save something we need first to find the culprit and the fault. And in this case the matter is really subjective. But now I like it so much, because to reduce carbon footprint G20 wants to tax everybody. But brother, is necessary to see first financial institutions practising what they preach and began to grab the taxes where the root is. OTC markets are the key to reduce carbon emissions and we need more “fiscal consolidation” and “increased transparency” indeed to do it. Otherwise they were watching the straw in the eyes of others, but not the beam in them.
If someone wants to audit the Fed, what will need first is to change the motto and search something banks seems to understand very well: the carbon footprint. And this is a really pretty one:
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The end of cheap coal is closer than we believe
Everything that has been explained above, is only a kinky introduction to what I want to explain next.
In Spain we are discussing what to do now with national coal. And I have write an article in Libertad Digital to explain what is hapening in international coal markets and help our mislead and futile politics in their decissions. Humbly, I thing is a must-read piece.
About coal markets we need to consider this 5 points:
We need in a hurry monetary stability in order to deal with energetic tightness. And the Federal Reserve is doing just the opposite. Somebody has to explain to the Congress urgently that we need a STRONG DOLLAR POLICY NOW AND TIGHT RATES if we want to reduce the mess we have now in front of us. But Mr. Bernanke is only thinking in Fed’s financial partners and probably he is leading us to the worst case scenario: inflation with shortages.
Let deflation run its course is the best thing he can do to remove all the bad investments. Is not possible to achieve International Energy Outlook 2010 Reference Case Scenario. Perhaps return to some kind of gold standard would be a good idea, Ben.
Marcos Ferrer. Qmunty.com.
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4 Comments
youri Carma
(@Twitter) 28 Feb 2011 11:02 am
The attack on coal plants by the green fascists is based on two basic lies. First one is the CO2 lie while also ifnoring “Climategate”. The second one is based on peoples ignorance regarding knowledge about how our electric energy actualy is produced.
100% clean burning coal plants exist today but the public has been totaly left in the dark by that fact. Coal is easy and cheap to produce ant abundant on earth. That’s the reason why the New World order had to come up with a plan to change that. The on fraud based Carbon Tax is a way to get world power by letting every global citizen pay directly to the banksters and can be taxed on almost anything including new born babies who exhale CO2 which the plants and the trees thrive on. The more CO2 the better plants and trees grow. In fact the earth is in a CO2 poor fase cause in the past CO2 levels on earth would be sextien fold with better wiildlife.
This carbon scam can be added to the long list of fraud like bogus Triple-A MBS, the infinite money printing in the FIAT system, market manipulation, racketeering, account fraud and son and so forth.
physis
28 Feb 2011 11:02 am
Dear youri, I am with you.
But the goal is to twist the carbon argument and to bat it strong against the financial pitcher.
And by the way, to propose a gold standard return.
youri Carma
(@Twitter) 28 Feb 2011 04:02 pm
The reason why Rothschild went into coal!
A Coal-Mining Champion Named Rothschild http://www.businessweek.com/magazine/content/10_50/b4207027620369.htm
The future fifth baron from the fabled banking clan is leading a $3 billion deal to create an Indonesian powerhouse that would be ideally positioned to profit off China’s voracious appetite for coal
Warren Buffett Could Be Eyeing Coal http://www.businessinsider.com/warren-buffett-could-be-eyeing-coal-2010-12
immegumedge
(@Twitter) 04 Mar 2011 08:03 pm
Liberty has restraints but no frontiers.