Some Responses to ECB QE

A few days back, in Turmoil in the Markets, I drew attention to the likelihood of the European Central Bank engaging in Quantitative Easing to prevent the Eurozone sliding further into recession and deflation. Here’s a round-up of some responses to the ECB’s Mario Draghi’s announcement of 1.1 trillion euro QE package.


ECB President Mario Draghi’s decision to undertake quantitative easing allows the 18 nations that have abandoned their local drachmas, lire, deutschemarks, etc. in favor of the euro to directly borrow money and buy their own national debt. The initial bond buying program is more than twice the size expected and includes eurozone peripheral members referred to as the PIIGS: Portugal, Italy, Ireland, Greece, and Spain. More importantly for the Davos crowd, the ECB’s commitment is open-ended for “whatever it takes” to create at least 2 percent inflation.

Although the Left has been screaming for such action over the last eighteen months, Draghi’s primary duty as president of the ECB was to control inflation. But when the eurozone actually fell into deflation of -0.2 percent last month, the ECB Board approved allowing the monetary debasement. But the plan only commits the ECB to buy up to 20 percent of the bonds and delegates 80 percent of the purchases to be bought by individual member’s central banks. This means each country will retain their nation’s default risk.

The structure of the deal will probably not impact the effectiveness of quantitative easing, but the political message is foreboding: “If things go badly, everyone is on their own,” according to Stratfor. This game changer is the first reversal from the process launched in 1951 for a eurozone becoming “an ever closer union,” with the eventual goal of becoming a “United States of Europe.”

Telegraph’s Ambrose Evans-Pritchard:

The decision amounts to an act of political defiance by a majority bloc in the Governing Council – unmistakably a debtors’ cartel of Latin states and like-minded states – and therefore opens an entirely new chapter of the EMU story.

This Latin revolt is to violate the sacred contract of EMU: that Germany gave up the D-Mark and bequeathed the Bundesbank’s legacy to the ECB on the one condition that Germany would never be out-voted on monetary issues of critical importance…

What is at stake is German political consent for the euro project. Bernd Lucke, the leader of the AfD anti-euro party, called today’s decision an “act of desperation and the introduction of eurobonds by the back door” by the ECB.

The Bavarian Social Christians (CSU) are also furious. “With this decision, the ECB has crossed the Rubicon,” said Angelika Niebler, the party’s parliamentary leader. The Bavarian finance minister, Markus Soder, said: “unlimited purchases of sovereign bonds threaten to bring down the whole system.”

On the Left, Die Linke lashed out at the decision, calling it a gift for insiders. It plunders the savings of the poor to make the “super-rich even richer” by driving up asset prices.

Mr Draghi may have saved Italy from a debt-deflation trap in the nick of time. He may have gained another year or two for Southern Europe to recover before radical populist parties sweep the stale elites from the political scene. But in doing so he risks losing Germany.

Zero Hedge’s collection of responses (my emphases added):

First the insanity of the ECB QE itself. The problem with Europe’s economy, what drives it into high unemployment and deflation, is that people are not spending. If QE would really be aimed at reviving the economy, or at battling deflation, it would need to assume that people will start borrowing on a massive scale just because Draghi buys bonds – and soon perhaps even stocks – from bankers. There simply is no logic in that. The stated goals, pro-growth and anti-deflation, are not true. It’s a sleight of hand.

In order to achieve the stated goals, money would have to reach the real economy. As it stands, the best Draghi can do is to ‘hope’ it will. That’s not enough by a mile. This is not about doubts over its effectiveness, that’s baloney, we know it’s not effective when it comes to the stated goals. It will still leave Europe with no growth, and deeper deflation, and now €1.1 trillion deeper in debt. While banks can grow their reserves.

and in the same piece:

QE For The Eurozone Is A Gigantic Confidence Trick. It Should Fool No One

…It was promised that it would yield new investment. It has not. It was promised that it would “pump money into the economy”. It has not. It was also feared that printing money would lead to hyper-inflation. It has not, for the simple reason that no one gets to spend the money. It is a bookkeeping transaction between a central bank and a commercial bank. It means nothing as long as banks are told to build up their reserves. Money in circulation matters. The whole of Europe, including Britain, is chronically short of demand, which is why deflation is such a menace.

Nobody is applauding QE much, it seems. It’s not going to help. Germany will back away.

And now my two bits.

Last week my bank told me that I had been cleared to borrow £3,300 (which I hadn’t asked for). But what am I supposed to spend it on? I’ve stopped spending, because a smoker like me is not welcome anywhere.

Up until 2011, I was a regular twice-a-year visitor to Spain. Since Spain banned smoking in January 2011, I haven’t been back. And I haven’t been anywhere else either.

I don’t go anywhere much in the UK either, because I’m not welcome there too (even though it’s my native country). I visited London a year or so back, and when I stepped off the train in Paddington, and took a look out onto the access road that leads inside the station, there was a forlorn crowd of about 100 people standing there, silently smoking. It’s etched in my memory.

I don’t do anything much now except, in summer, get in my car and drive to some distant pub with a garden, to sit and drink a pint of beer, and smoke a few cigarettes, and drive back again. I don’t want to stay in any hotel or B&B, because I’m not welcome in those places either. So my range is restricted to about 50 miles max, if I want to be home by nightfall, and of course my alcohol consumption has to be restricted too.

You can wave all the £3,300 loans you like in my face, I’m not going to spend it, because there’s nothing I want to spend it on.

The European economy isn’t being strangled by a shortage of money. It’s being strangled by regulations. Regulations on businesses (ask Dick Puddlecote!). And regulations on consumers (No smoking, no drinking, 20 mph for the next 2 miles, etc, etc). We have a whole army of highly paid bureaucrats and lobbyists working round the clock to make us stop spending money, and making it harder and harder for the producers to sell things (e.g. Plain Packaging).

People can’t buy or sell what they like, so they’re stopping buying and selling.

What Europe needs isn’t QE or low interest rates. What Europe needs is deregulation. And the EU is itself the primary regulation generator. So that’s what’s going to have to go.

The best thing that Greece (and most of southern Europe) could do would be to leave the EU, and leave behind all of its innumerable rules and regulations at the same time (like I was suggesting last night).

But nobody seems to see things this way. So I can only suppose that, as the engine of the economy meets stronger and stronger regulatory resistance, it’ll just stall completely. And there will be a whole slew of business failures across the whole economy, and sky-rocketing unemployment, and civil disturbances.


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34 Responses to Some Responses to ECB QE

  1. Hello,

    As Frank mentioned a few posts ago, my comments are being pre-moderated.

    I wanted to log in to thank Walt for his kind words. I thought I could find him on other blogs, but I couldn’t and I want him to know that I fully accepted his best wishes for me as genuine and I am most appreciative of them.

    Also, I wanted to thank mikef317 and all the others for welcoming me back with words of encouragement. My email address is on the ‘About Me’ tab on the link if you want the full version of what I wrote, which doesn’t disrespect Frank or anybody else. I can send a ‘carbon copy’ to Frank.

    I just didn’t want you thinking I didn’t appreciate your caring. I had written a brief treatise on what more can be done to forward our cause, as blogging alone isn’t getting us anywhere. I have been active for 13 years and we just get treated worse and worse.

    I will put it together in a coherent format.

    Best wishes,


    • The Blocked Dwarf says:

      ” as blogging alone isn’t getting us anywhere”

      Can’t disagree with that -unusually for anything you say, I know, and while we’re on the subject HOW THE SWEET F**K did you manage to get Frank (surely one of the most ‘liberal’ bloggers around) to put you moderation?! This might sound ‘mote and beam’ but if I were you I would be questioning my ‘attitude’.

      Anyways, when you’re right, you’re right. The only way I can see of getting the smoking bans relaxed is with serious financial backing and by putting ‘innocent’ business owners out of business. A start would be to boycott buying any UK Duty Paid cigarettes. Put Mr Patel out of business (although I doubt Mr Patel makes enough on the sale of a packet of smokes these days to really notice). The way to win concessions is by making it impossible for the police to function. If every police officer on the beat is spending all evening charging ‘black’ smokers- who light up anywhere and everywhere and when the Police are called then refuse to accept the on-the-spot Fine thingy, insist on being charged etc.

  2. Jude says:

    Same thing is happening in Australia, people have stopped spending. We have a government telling people that we are in a “budget crisis”, (not true), we have increasing restrictions on smoking, alcohol, and basically anything that the puritans believe is bad for health. Its been a very long time since people were given any good news at all, and the stupid government here wants to bring in more austerity measures, cutting funding to those areas that support the most vulnerable, but ignoring issues such as upper class welfare, (which dwarfs any welfare spending for those most vulnerable, such as the unemployed, sick, disabled, old etc).

    We have smoking bans, fines and draconian laws, along with the failed plain packaging nonsense, while the treasurer himself, on the night before bringing down an austerity budget, that of course hurt those least able to afford it, was photographed smoking a cigar with his finance minister, apparently smoking bans only apply to those filthy working class people.

    I used to love my country, it was a laid back place, where pinch mouthed puritans were at best simply ignored, now on the eve of our national day of celebration, if I could afford to move somewhere else, where there is more freedom, I would.

    As it is, I will keep to myself, and enjoy my vapes, I wont be spending any money on vaping in my state, as they have banned the sale of vape gear here, so my money will go overseas.

    • Yup Exactly! And add in the BULLSHIT Health cost savings they made up to cover their asses over lost revenues their fucking Lifestyle health laws caused…………

      • Jude says:

        The smoking bans are only the tip of the iceberg as far as political and corporate corruption go. People are treated as little more than machines, units of labour, unless of course you happen to be one of the money bags. I’m so tired of it all. This is not a right or left wing thing, that division exists only in the spin put out by the corrupt greedites, and their “useful idiots”.

        • nisakiman says:

          “State ‘should offer parenting lessons to every family'”

          “We have small families and we need to make the most of each child economically, as well as everything else,” he said. (My emphasis)

          As you say, Jude, people are treated as little more than machines.

        • Worse than that Nsakiman obamacare being deemed a tax is a tax on your body by the government. In other words they just made it official they own every so called citizen. Even the NHS is based upon a tax but its part of your payroll deductions each payday much like Americas FICA taxes. This tax is not as much on your income as it is on you demanding even if your not working you still must pay a tax or be enrolled period. Unless your got good money to pay the bribes to obamas fixers and get a excemption from it!

  3. But the plan only commits the ECB to buy up to 20 percent of the bonds and delegates 80 percent of the purchases to be bought by individual member’s central banks. This means each country will retain their nation’s default risk.

    YUP! Exactly

    The European economy isn’t being strangled by a shortage of money. It’s being strangled by regulations. Regulations on businesses (ask Dick Puddlecote!). And regulations on consumers (No smoking, no drinking, 20 mph for the next 2 miles, etc, etc). We have a whole army of highly paid bureaucrats and lobbyists working round the clock to make us stop spending money, and making it harder and harder for the producers to sell things (e.g. Plain Packaging).

    Yup Exactly! Its not just the smoking ban its the all of it and its not just in the EU its worldwide as they pressed home the FCTC on everybody which forced them to have to inflict their citizens with smoking bans or they wouldn’t get any world bank and IMF loans ie NO BAILOUTS.

    That’s what was loaded in just the FCTC treaty and no doubt its the same in all the other treaty deals and non-deals that have been foisted upon every country in the world via UN mandates and other such BS like carbon taxes that do nothing but take more money away from struggling people and their own nations……….

    The whole scheme has to go for its these world Elitists policies and keneysian economics that destroyed the world economy not greed for just money but greed for absolute power!

  4. Lepercolonist says:

    My love of travel vanished after the bans. It’s a big pain-in-the-ass now. Not worth the hassle.
    “People are not spending.” Wonder why ?

    • nisakiman says:

      As I’ve mentioned recently, I’m currently in Thailand (who’s government are completely in thrall to the FCTC, and not only implement it with enthusiasm, but gold-plate it), and Bangkok for me is something of a smoker’s nightmare.

      You could spend all day going round Bangkok without finding one spot to have a cigarette. It is a city of (non-smoking, air-conditioned) shopping malls. The transport system in many cases delivers you directly into these upmarket malls (want to buy a Rolls-Royce? A Lamborghini? Maserati? Or maybe Dior or Versace or Hermes? Just get off the BTS at Siam and cross the small [non-smoking] bridge in to Paragon mall…). Naturally, you can’t smoke anywhere in or around the BTS stations. And if you find some places with tables outside in Siam Square, they will all have these dinky little ‘no smoking’ signs on every table. It drives me nuts. However, I’ve found that if I sit at one of these outside tables (with their dinky little ‘no smoking signs) and order a cup of iced coffee and just light up anyway, nobody turns a hair. Maybe it’s the ‘don’t-even-think-about-pointing-to-your-dinky-little-no-smoking-sign’ expression on my face that persuades them not to tell me I can’t smoke. Dunno.

      It’s only when you move downmarket that it gets easier to have a ciggy, and where I am now (Ubon Ratchathani) which is an hour flight from Bangkok near the Lao border, things are much more relaxed.

      But after being used to living in Greece, Bangkok is a real shock to the system. And international airports are a lottery. Oddly, the airports in Bangkok tend to have smoking lounges airside, which not that many airports do.

      Yes, travel ain’t what it used to be.

  5. The Blocked Dwarf says:

    I just went to pay this month’s phone bill online (and couldn’t cos BT is down again but that has nothing to do with this comment). Before logging on to BT I first checked the balance of my current account and it stood at £399 in plus.
    Yes I know, most of the commentators here probably have many times that amount in their current account. But I am on benefits because I care for my disabled wife 24/7 and today is the last day of the month. The last day of what used to be ‘Baked Beans Week’. At midnight tonight the money for next month goes into my account.

    So why am I telling you this? Until 2007 I always had more month than money no matter how I earned (and there were times when I didn’t leave the house without at least £500 in cash in my pocket). I haven’t had an overdraft for almost 20 years but until 2007 the last week of the month was always ‘down to the wire’

    I don’t live a particularly frugal life, nothing like the poverty of my childhood. I run a car, I smoke 40-60 a day, we eat well and there are very few packets with ‘Tesco Everyday Value’ on them in my cupboards except for the toilet roll cos I refuse to pay large amounts for something I wipe my arse with, the bills are paid on time (well most of them anyways). We have long foreign holidays -always driving so I can smoke. I can’t recall the last BT cut us off for non-payment. I can even be The Bank Of Dad for my 3 supposedly ‘adult’ sons.

    Since 2007 I have simply stopped spending money. I no longer spend £40-£80 a week in cafes. We don’t go out for meals. We don’t socialise in anyway really. Now, not all of that is down to the Smoking Verbot, it’s hard to socialise when your wife is a sweet little paranoid-psychotic, but a lot of it is. I try and make a point not supporting any business that doesn’t want my custom. Nearly everything I purchase is purchased online and if possible from abroad.

    I reckon that that is typical for most smokers and the reason for the financial malaise Europe finds itself in. As you , Frank, say: there is nothing I want to spend money on.

  6. psok says:

    As always, the great economy rules. the real world avoids all the bullshit rules, pays no tax, steals, cheats and kills.

  7. ‘Cigarettes, whisky, and wild, wild women’

    Having spent 113 years and 14 days on this earth, Henry Allingham is used to breaking records.

    He is one of three British men still alive who actively served in the First World War, is the last surviving founder of the Royal Air Force, has long held the record for being the oldest man in Europe and earlier this year he became Britain’s most ancient man ever after overtaking John Evans, a Welsh former coal miner who died in 1990 aged 112 years and 295 days.

    But when Mr Allingham woke up yesterday morning at St Dunstan’s care home for blind ex-service personnel, in Ovingdean, near Brighton, the supercentenarian was informed that he had suddenly achieved the highest age-related accolade for men.

    Tomoji Tanabe, a Japanese retired civil engineer, had died peacefully in his sleep overnight. He was 113 years’ and 274 days’ old and had more than 50 great-grandchildren. Having foregone alcohol and cigarettes all his life, Tanabe had became the world’s oldest man in January 2007.

    That mantle has now passed to Mr Allingham – the first time a British person has ever held such a title.

    A St Dunstan’s spokesman said that the oldest man on Earth greeted the news by simply returning to bed after breakfast for a celebratory nap.

    For someone who has seen three different centuries, six monarchs, two world wars (and 18 world cups), becoming the oldest living man is, perhaps, something of a non-event.

    Mr Allingham is quieter these days, but no codger at heart. In contrast to Mr Tanabe’s asceticism, he attributes his longevity to “cigarettes, whisky and wild, wild women”.

    The Air Mechanic First Class is best known publicly for his war record, because of the many public engagements he has attended – up to 70 some years – including regular meetings with the Queen, politicians and soldiers returning from theatres of war in Iraq and Afghanistan.

    Yet he dislikes talking about conflict, saying only: “War’s stupid. Nobody wins.”

    He added in an interview recently: “Like so many, I have tried to forget my time in the war. In the last few years I have met other veterans, and we never spoke one word of the war, not one.”

    One of the many remarkable things about him – particularly given the mores of his time – has been his willingness to talk about mental health. “I’ve had two major breakdowns,” he recalled, “one during the war and one after. But both when I was trying to do the work of three men.

    “The trick is to look after yourself and always know your limitations.”

    On the key to a long and prosperous existence, he added: “I don’t know if there is a secret, but keeping within your capacity is vital.”

    Allingham was born on 6 June 1896 in Clacton, east London, and his father died when he was a baby. One-hundred-and-thirteen years later his dynasty includes six grandchildren, 12 great-grandchildren, 14 great-great-grandchildren and one great-great-great-grandchild.

    In the meantime, he has personally experienced the events now known about predominantly through history textbooks. At the time of his birth, the Football League had only two divisions and 23 teams, including long-since-departed mainstays such as Bootle FC and Northwich Victoria.

    Just two months earlier, the first ever modern Olympics had taken place in Greece, with 15 international teams, among them that of the Austro-Hungarian Empire.

    Mr Allingham’s earliest memories include cheering WG Grace at the Oval in 1903 and watching soldiers returning from the Boer War – an occasion which eventually inspired him to join the military himself.

    In 1915, shortly after his mother’s death, he joined the Royal Navy Air Service, initially to help maintain sea planes. But high casualty rates – and Mr Allingham’s enthusiasm for taking to the air – meant that he soon joined in with air missions, serving as a spotter with Britain’s fleet of flimsy biplanes. A year later he narrowly escaped death at the Battle of Jutland; a German shell hurtling towards his merchant ship, the Kingfisher, ricocheted on the water and whistled clear over the ship’s deck. He went on to fight at Ypres – where standing in two-feet of water in the trenches particularly haunted him – the Somme and Passchendaele.

    Yet another of the exciting episodes in Mr Allingham’s life began in 1919 when he left the air force and went into the burgeoning motorcar industry, joining the design department at Ford cars in Dagenham.

    The engineering skills he learnt there were put to use during the Second World as a designer of countermeasures to the German navy’s magnetic mines.

    The 113-year-old spent over half a century married to his first and only wife, Dorothy, with whom he tied the knot in 1919, shortly after returning from the First World War. Together they had two daughters, Jean and Betty, who emigrated to the US and both died in the 1980s.

    Dennis Goodwin, the founder of the First World War Veterans’ Association and a long-time friend of Mr Allingham, said he was not surprised by his pal’s relaxed response to yesterday’s news. “He is philosophical, he will take it in his stride like he does everything else,” Mr Goodwin said.

    “I think he has done so well to now because the more you engage people and focus attention on them, the more they develop a will to live.

    “And that’s the case with Henry. If he had been allowed to vegetate he would have disintegrated.”

    For his family, the news is yet another reason to be proud of an extraordinary man.

    “It’s fantastic news,” said Mr Allingham’s nephew Ronald Cator, 74, who is one of just a handful of relatives who does not live in the US, where Mr Allingham’s two daughters emigrated many decades ago.

    “He is very frail now, but I’m sure he’ll be pleased to hear it. We are very proud of him.”

  8. prog says:

    Bill Bonner..

    Dow up big time – 259 points, or 1.5%
    Gold up too – to over $1,300 an ounce.
    This year is going to be a hoot. Boom, bust, lies and claptrap – we’re going to have it all!
    What accounts for yesterday’s big bullish surge? From Bloomberg:

    ‘The MSCI Emerging Markets Index added 0.8% to 983.53. Russia’s dollar-denominated RTS Index rose the most in the world and the ruble strengthened as the ECB’s move encouraged investors to buy riskier assets.
    Gauges in Poland, Hungary and the Czech Republic increased at least 0.9%. Oil producer Petroleo Brasileiro led gains in Brazil. Asian stocks jumped as China pumped funds into the financial system.
    ECB President Mario Draghi unveiled a quantitative easing plan of 60 billion euro a month until at least the end of September 2016. The move, which is intended to counter slowing growth and the threat of deflation, may spur capital inflows into developing countries. China’s monetary authority used open-market operations to add cash to the financial system for the first time in a year and spurred loans amid a fund shortage.,’

    Awe and Wonder

    Will this bold move help the euro-zone economy? Will it make Europeans richer, happier, better lovers or better sportsmen?

    Not if it works like the US version.

    The funniest part of this story is that Draghi made his announcement with a straight face. What a comic – a real Leslie Nielsen. As we saw yesterday, the average American is poorer than he was before the QE programs began.

    But all over the world, speculators are running wild. In a single day, following Draghi’s big news, they made a cool $1 trillion.

    Where does this money come from?

    Corporations are not worth a penny more than they were on Wednesday. Why would they be? All that has happened is that the European Central Bank has pledged to use money it doesn’t have to buy assets that are already extraordinarily expensive.

    Bonds from Italy, Spain and France are already priced at levels never before seen in human history. On the evidence, never have investors had more faith in European governments’ ability to service their debt… or more faith in the currency in which their obligations will be honored.

    This alone makes our mouth drop in awe and wonder. Never before in history have these very same governments been so deep in debt with so little prospect of ever paying that debt back. And never before have their central bankers been so openly committed to devaluing the money they are supposed to be protecting.

    All of which is mind-boggling… extremely funny… or both.

    Europe’s QE program is supposed to “counter slowing growth and the threat of deflation.”

    But how does Mario Draghi know how fast an economy should grow? How does he know what prices should be?

    Oh, we are being mean-spirited to ask. It’s like asking an aging prizefighter if he really needs another blow to the head; we’re just making fun of him.

    Yes, another giant money-printing scam is under way – this time in Europe. This will put two of the world’s biggest economies – Japan and Europe – in full liquidity-pumping mode.

    The dollar goes higher. American chests fill with pride – apparently unaware that they are losing the “race to the bottom.”

    Their exporters will find their sleds rubbing up against hard stone and soft mud. Especially their oil exporters! For the price of oil has dropped in half in the last six months.

    Silver Linings… No Clouds

    According to TV’s Larry Kudlow, the US enjoys the equivalent of a “giant tax cut” thanks to low oil prices.

    Nine months ago, he said it was enjoying an “economic renaissance” thanks to high oil prices (which brought a boom in the fracking states).

    What a great time to be an investor. Silver linings everywhere – with no clouds. And when you are riding your bike, all roads are downhill.

    Yesterday, we promised to tell you why America’s middle classes have lost ground.

    It barely seems possible. America is the crown of capitalism, isn’t it? And doesn’t the 21st century – which we live and breathe every day – carry in its balmy air the elixir of growth, progress and riches beyond our imagination?

    How is it possible… with so many more lawyers… so many more economists… so many more public servants – all striving, sweating, straining to make life better for us all – that we have less real, spendable wealth than we had before the century began?

    State of the Union

    We are staggered by the question.

    And once we recover our footing, we will come up with an answer. It is too big a subject to tack onto this Diary entry, but we will give a hint by asking another question:

    Who makes life better? Who actually adds to humans’ wealth, happiness and the quality of their lives?
    Government employees?

    Is it the people who say they are working to create a better world – like President Obama in his State of the Union address:

    … helping working families feel more secure in a world of constant change… That means helping folks afford child care, college, health care, a home, retirement – and my budget will address each of these issues, lowering the taxes of working families and putting thousands of dollars back into their pockets each year.
    Or is it another class of people altogether – people who are too busy turning out products and services to feed you a line of B.S.?

    You can guess. But you may not know that those people are disappearing.

    More about them on Monday…

    • Just heard on FOX since 2008 the dow is up 230% the S&P 260% Now how do they go up and everything else is wiped out………..stimulus and QE in unlimited mass cash from th FED pumps……….all the inflation is in the markets plastic values just waiting for a warm sunny day to melt it all to a puddle of useless burning mass!

    • Its simply called the CURRENCY WARS just like in the last depression they all did the same things then as now……….kept printing fake dollars to no real values and debased currencies until it all finally collapsed. All they are doing is putting off the eventual collapse for a tad longer. While the rest of us have been there since 2008!

      • Ian Beattie • 2 days ago

        When we print money it’s called “counterfeit,” but when governments print money they call it “stimulus”….

        • It surprises me that hyperinflation has not occurred yet. Europe and the United States has printed money for years, but hyperinflation has not happened. I wonder how much longer we will wait before it happens.

          Its because its mouse click dollars were for wall st not main street or even the alleyway! In 1929 they had to print real money today they just create it out of thin air on computers and they say overnite they are worth xxxx and the FED goes ok! Then they tell banksters at the cash window heres another cool 50 billion now go buy my buddy obamas cousins stock and pump it up then dump it in 2 weeks and let the vultures feast. Then we tax the heck out of them on gains at the end of the year and get it back making the revenue stream look real to all the rest of the idiots.

  9. This Is The Beginning Of The End For The Euro

    The long-anticipated collapse of the euro is here. When European Central Bank president Mario Draghi unveiled an open-ended quantitative easing program worth at least 60 billion euros a month on Thursday, stocks soared but the euro plummeted like a rock. It hit an 11 year low of $1.13, and many analysts believe that it is going much, much lower than this. The speed at which the euro has been falling in recent months has been absolutely stunning. Less than a year ago it was hovering near $1.40. But since that time the crippling economic problems in southern Europe have gone from bad to worse, and no amount of money printing is going to avert the financial nightmare that is slowly unfolding right before our eyes. Yes, there may be some temporary euphoria for a few days, but it is important to remember that reckless money printing worked for the Weimar Republic for a little while too before it turned into an utter disaster. Now that the ECB has decided to go this route, it is essentially out of ammunition. The only thing that it could potentially do beyond this is to print even larger quantities of money. As the global financial crisis begins to unfold over the next couple of years, the ECB is pretty much going to be powerless to do anything about it. Over the next couple of months, we can expect the euro to continue to head toward parity with the U.S. dollar, and eventually it is going to go to all-time lows. Meanwhile, the future of the eurozone itself is very much in doubt. If it does break up, the elite of Europe will probably try to put it back together in some sort of new configuration, but the damage will already have been done.

    Over the next 18 months, the European Central bank will create more than a trillion euros out of thin air and will use that money to buy debt. The following is how this new QE program for Europe was described by the Telegraph…

    The combined monthly purchases of public and private sector securities will amount to €60bn euros,” said Mr Draghi at a press conference following a meeting of the ECB’s governing council.

    “They are intended to be carried out until end-September 2016 and will in any case be conducted until we see a sustained adjustment in the path of inflation,” he added, meaning the package will amount to at least €1.1 trillion.

    Mr Draghi’s package of asset purchases, including bonds issued by national governments and EU institutions such as the European Commission, is intended to boost the eurozone’s flagging economy and to ward off the spectre of deflation.

    When you print more money, you drive down the value of your currency. And the euro has already been crashing for months as you can see from the chart below

    As I write this, the euro is down to $1.13. And most analysts seem to agree that it is likely heading even lower.

    How low could it ultimately go?

    One prominent currency strategist recently told CNBC that he believes that it is actually heading beneath parity with the U.S. dollar…

    The euro plunged to an 11-year low on Thursday, after the European Central Bank announced that it would begin a 60-euro monthly asset purchasing program. But it could still have a ways to fall.

    Brown Brothers Harriman global head of currency strategy Marc Chandler predicts that the euro, which fell as low as 1.1362 on Thursday after trading near 1.4000 in May, is heading below 1.0. That widely watched level is the point at which it will just take a single U.S. dollar to purchase a euro, a condition known in the currency markets as “parity.”

    I totally agree with Chandler.

    In fact, I believe that the euro is ultimately going to break the all-time record low against the dollar.

    I also believe that the current configuration of the eurozone is eventually going to fall to pieces. The euro may survive as a currency, but Europe is ultimately going to look a whole lot different than it does right now.

    In fact, we could see things start to come apart for the eurozone as soon as Sunday. If Syriza wins a decisive victory in the upcoming Greek elections, it could create all sorts of chaos…

    The polls put Alexis Tsipras and Syriza ahead of the ruling New Democracy party of Greek Prime Minister Antonis Samaras.

    Tsipras has vowed to convince the ECB and euro zone to write down the value of their Greek debt holdings to allow him to increase public spending and stimulate job growth.

    “There is a good chance they could win, and if they begin moving away from fiscal austerity, other members of the EU are going to say: ‘No more lending, no more life support.’ On Monday morning you’ll know,” De Clue said.

    But of course Europe is far from alone. Financial problems are erupting all over the planet, and central banks are getting desperate.

    Over the past week, seven major central banks have made moves to fight deflation. But the more that they cut interest rates and print money, the less effect that it has. And eventually, the people of the world are going to seriously lose confidence in these central banks as they realize what a sham the system really is.

    I think that these recent words from Marc Faber are very wise…

    “My belief is that the big surprise this year is that investor confidence in central banks collapses. And when that happens — I can’t short central banks, although I’d really like to, and the only way to short them is to go long gold, silver and platinum,” he said. “That’s the only way. That’s something I will do.”

  10. prog says:

    They’re very tough on counterfeiting, aren’t they? But gov printing money without really having much to back it with surely amounts to the same thing – damage to the economy. Actually, they have – it’s Joe public who ultimately takes full responsibility for national debt.

  11. Welcome to Law Enforcement Against Prohibition

    Law Enforcement Against Prohibition is an international 501(c) 3 nonprofit organization of criminal justice professionals who bear personal witness to the wasteful futility and harms of our current drug policies

  12. Bloomberg: Uncle Sam Is Coming After Your Savings

    By Nick Sorrentino on January 24, 2015

    Make no mistake, the government wants your savings. They want as much as they can get politically. The president recently floated the idea of taxing 529 plans, used to save for college, to pay for community college for people other than your kids. Why should the money your earned, and saved, go to your family? Better for the government to take your money from you so that it can give a gift to political allies.

    Some people might call this theft. But not us. Oh, not us.

    As Megan McArdle explains, the assault on 529 plans (though thankfully it’s not going anywhere) is likely only the beginning. The middle class may very well see more efforts to raise taxes on them, soon.

    Let’s just say that if you continue to live in a so called “blue state” you have been warned.

    From Bloomberg)

    Yes, I know that tax rates used to be much higher in the middle of the 20th century. However, eye-popping, high-double-digit rates fell on a much smaller share of the population, and therefore didn’t raise all that much money; they were mostly symbolic, especially since they were combined with a much more generous array of deductions. Also, there’s a reason that countries largely stopped trying to enact such heavy tax rates; in an era when global capital, and people, move pretty freely, they turned out to be mostly counterproductive. This is also why we don’t try to tax the bejesus out of capital income, much as many would like to; old capital flees, and new capital doesn’t get formed, as savers decide it’s not worth it.

    What that tells us is that politicians will need to reach further down the income ladder in order to fund new spending — indeed, to fund the spending we’ve already done, in the form of entitlement promises. Where will they go for that money

  13. The Confiscation of Bank Deposits and The Derivative Debt: Ellen Brown on GRTV

    Last month’s G20 Summit in Australia came and went without the protests and riots we’ve come to expect…

  14. Davao gets millions in anti-smoking fines

    BusinessWorld Online Edition

    DAVAO CITY — The Davao City Anti-Smoking Task Force collected almost P1.5 million in fines from local tourists after they were caught lighting up in public areas for the period January to November 2014

    The amount could have reached almost P22 million if all the 4,396 violators were able to pay the fine of P5,000 each. Those who failed to do so are facing criminal charges in court.

    “We have intensified the implementation of the anti-smoking ordinance but local tourists still smoke in public areas,” said Dr. Domilyn C. Villareiz, co-chairperson of the Anti-Smoking Task Force.

    The number of persons apprehended was 19% higher than the 3,690 recorded in the same period the previous year.

    Ms. Villareiz noted that the violations are not due to lack of awareness of the city’s regulation, but “those who are already addicted to smoking will take the risk of being caught.”

    The Comprehensive Anti-Smoking Ordinance of Davao City was first enacted in 2002, a year before Congress approved the Tobacco Regulation Act of 2003, and was expanded in 2012 to include all tobacco products such as e-cigarettes and shishas.

    The fine was also increased to the current P5,000 from P2,000.

    Specifications for designated smoking areas in commercial and business establishments were also amended to 10 meters from entrances and exits with an area not larger than five square meters.

    Ms. Villareiz urged both domestic and foreign tourists to comply with the city’s ordinance to avoid the fine as well as the required counseling that has to be done within Davao City.

    According to data from the Department of Tourism, more than 1.4 million tourists, mainly local, visited Davao City in 2013 and the city government was aiming for a 10% increase in 2014.

  15. Smoking Scot says:

    “But nobody seems to see things this way.”

    Wouldn’t say that Frank, an awful lot of people see exactly the same picture as yourself. Not much point in saying so. Those who can take avoiding action, although I felt the move by the Swiss was a perfect Bulltrap.

    Your comment about Syriza now seems to be fact. Whatever happens they’ll lead the next Greek government, so anyone thinking of buying Euro’s tomorrow might want to delay that for a while. They’ll be cheaper on Tuesday and quite probably lots cheaper by the end of the week.

    About our spending, I still find it odd that the articles you quote make no mention of what’s important to government. Tax. And two of the highest taxed are tobacco and booze. Of course we, the smoker, know that nothing else we buy donates anything close to the gov’t. Regular stiff’s probably don’t factor that into their economic models. Pity.

    Then there’s the production, processing, ditribution, marketing, retailing side to consider.
    Put very simply we can have as many Costas and Nero’s and Starbucks as we like, but the tax take on a standard cup’s naff all and Starbucks haven’t paid diddly squat in tax for several years.

    Then there’s the effect of crowdfunding. Brilliant idea, however they take the very best startup’s and find the money they need. That’s excellent, but it does leave the banks with the higher risk business startup’s – and in many cases they’re hardly worth a second glance.

    Now the biggest kick in the gonads for the banks: Pensioner Bonds.

    That soaks up millions of Pounds with interest rates the banks couldn’t even begin to match. Where’s it coming from? Banks, Building Societies and such is where.

    It’s a double whammy for banks, but they’ve got no choice other than grin nicely and say the correct thing.

    (I’ll avoid going into virtual currencies, the amounts flowing into them, the tax that cannot be collected and so on. Too yesterday.)

  16. Jan Johnson

    30 mins ·


    No one wants to live under the IMF’s austerity plans. That’s clear from the election results here. No opinion. I hope the leftist lean works for a country weary of suffering and pain.Again no opinion but generally when one leans that far to the left everyone shares the pain.

    Greece’s anti-austerity Syriza party officially wins parliamentary elections

    Greece’s radical leftist party, Syriza, is leading the country’s parliamentary election, claiming 36.5 percent of the vote, and leaving the ruling New Democracy party in…

    • Greece’s radical leftist party, Syriza, is leading the country’s parliamentary election, claiming 36.5 percent of the vote, and leaving the ruling New Democracy party in second place with 29.22 percent, according to the first official results.

      The votes have so far been counted at 25 percent of polling stations across the country, the Interior Ministry of Greece said.

      Greek Prime Minister, Antonis Samaras, has acknowledged defeat and congratulated Syriza’s leader, Alexis Tsipras, on the phone regarding his victory in the election, Reuters reports.

      The exit-polls earlier revealed that Syriza, has won between 35.5 and 39.5 percent of the vote in the national parliamentary election, leaving the New Democracy party more than 10 per cent behind.

      The New Democracy party, led by Greek Prime Minister, Antonis Samaras, has received between 23 and 27 percent of the vote.

      • A senior New Democracy party member, health minister Makis Voridis, has conceded defeat to Syriza in the elections.

        “We lost. The extent of that result is not yet clear,” Voridis told Mega TV.

        If the results of the exit polls are officially confirmed, Syriza will become the first ruling anti-austerity party in Europe


        • Smoking Scot says:

          Oh the extent is now very clear. They got whooped… big time


          Syriza are two seats short of an outright majority. Golden Dawn have 6.3% and came in 3rd and… to my intense delight that anti-smoking twat, George Papandreou’s new party – Democrat Socialist Movement – didn’t even get to the 3% threshold.

          Next stop Spain!

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