EuroDollar - Global FInancial System in one ChartA lifelong student of Monetary History, Macro/Micro Economics - at this particular
point in time, an obligation needs to be fulfilled.
We tend to be Anglo-Centric as Americans. Yes, we do observe Global Markets
and their underlying dynamics as core to one's thesis for Trading purposes.
All is well and good in that vain.
Unfortunately, it is barely the tip of the iceberg.
Beneath the surface exists a behemoth.
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If you are unfamiliar with arrangements made during June 1944... no problem.
Allied Leaders met to arrange the Global Chess Board for the Anglo-Sphere.
They had 2 items on their collective agenda:
1. Rebuild Europe
2. Establish a Global Monetary system/order aka the International Monetary System.
44 Nations attended the follow-on meetings @ Mount Washington Hotel in Bretton Woods,
New Hampshire during the first 3 weeks of July 1944.
Agreements in Summary:
1. Acceptance of the US Dollar as the Reserve Currency - opening the Gold-Exchange Window.
2. What came to be known as the Marshall Plan began its lengthy formative process to
reconstruct Europe.
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The United States had accumulated 70.37% of the Worlds Gold in exchange for Productive
Capacities during the War, and thereafter for its Industrial output, imbuing a confidence
in the Dollar - "It was as good as Gold."
It was not until the Marshall Plan was well underway, that the "Others" found the BR1 agreement
less than desirable, it had numerous flaws for their purposes.
They developed a "System" of exchange in February of 1957 - Eurobank Dollars later became
known as the "EuroDollar".
The "they" is important for 2 primary reasons.
1. "They" - the "Others" run the Financial arrangements and by extension - the planet.
2. It is a private, unregulated, Exchange outside the auspices of the United States and its
Central Bank - The Federal Reserve chartered in 1913.
Our Central Bank, as all Central Banks... receive marching orders from the Conduit
between the Private Global Banking systems and Central Banks Globally. This conduit
is the Bank of International Settlements or more commonly known as the BIS.
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Monetary malfeasance was quite common in our relatively short Nation's history.
The 1st Bank of the US failed, Jackson ended the 2nd, Lincoln paid the price for
attempting his own unit of exchange free from the Vig, Kennedy... yeah... ditto.
Within the United States, there were a great many crises.
Globally, there was a great deal more.
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The Private system never really had the havoc inflicted upon its henchmen, the "Central Banks."
Authur Burns, Paul Volker, Alan Greenspan, Ben Bernanke, Janet Yellen, and now Jerome Powell,
like his predecessors served under the complete control of the Private World Monetary Order.
Our Federal Reserve manages one thing - Expectations.
Well, they do manage Base Money and Bank Reserves... another "Expectation"
as Bank Reserves are not Money, they are a SWAP. It is an Inter-Bank settlement
mechanism.
"Don't fight the Fed" -
They are not at all engaged in the actual Global Financial System.
The Private System dwarfs the Public System, by orders of magnitude.
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Over the Decades following BR1, things began to unravel for the US Dollar Seniorage (Reserve
Currency Privilege).
Spending on Wars (Korea and Vietnam), LBJ's Great Society, Aero-Space, and persistent Defense
Spending, Social Programs, reckless spending due to Political corruption... all took their toll.
The Public System began showing signs of immense stress when the London Gold Pool collapsed.
On August 2, 1971, the full monty hit the United States as Nixon observed Degaulles warships arrive
in New York harbor to collect France's Gold - Nixon knew he has no choice but to close the
Gold Exchange Window.
This action placed the United States on a purely FIAT System of exchange.
More importantly, it freed the Private System of a very large shackle, the finite supply of US Dollars.
People incorrectly assume the FIAT Dollar became the Petro Dollar.
In no way, shape or form did it. That is simply a fraud built up on a very dubious foundation.
Yes, Kissenger agreed to give the Saudis a Price hike in exchange for the following.
1. Acceptance of US Treasuries as Currency.
2. Arm the Kingdom to its desires (which were immense.)
3. Guarantee their Sovereignty.
Nothing more, nothing less. An actual fraction of total Global Exchange.
The "Petro Dollar" is a myth, it should seem quite simple on the surface, but
decades of misdirection often lead to the adaptation of History's great frauds.
BR1 flaws gave way to a floating exchange rate. Trade and Financial flows were
no longer limited by Gold.
Nor were they limited by Oil, ever. We never moved to an "Oil" based system.
Utter nonsense never accept the Petro Dollar analysis, it is a total fraud. A flawed
thesis usually perpetrated by those who seem to believe we will be returning to a
Gold Standard.
That does not suggest Energy, Gold, Resources are not Tier 1 Assets, they indeed are
in fact held as SDR Assets. It is a mere fraction of a fraction of the Total Reserves.
This is a very large distinction for the Club we are not members.
The EuroDollar removes currency from the national store of "Reserves."
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The rest as they say - "is History."
Let's circle back to the Euro Dollar for further insights into which we are hostage.
US Dollars on deposit outside the United States - initially these were actual physical
Dollars printed by the Treasury.
They did, however, evolve into a Hybrid Virtual Ledger System that has assumed the role
of the Global Monetary Reserve.
Moving Gold from cage to cage at depositories, physical paper notes... unnecessary.
The first real "Cashless" System arrived long ago, 65 years to be exact.
A Private System that operates outside ALL Nations and their regulations and most
importantly - Central Banks.
They do as they please when they please - in the Shadow Monetary System.
None of this System's actions ever show up in any/all statistics put for by any one
Nations Fiscal and Monetary Accounting.
Not one thin Dime.
There is no quantitative or qualitative metric to observe.
Great Gig eh?
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There is much more to the underlying Private System than can or should be extolled here.
A great deal more, that would consume hundreds of pages.
For now, hopefully, this inspires people to do their own work on how the evolution of the
actual Monetary System functions and why the Chart within is vitally important.
You will discover very quickly, that the largess of the Private System is exponentially larger.
A flattening Yield Curve to Inversion is a warning of a Supply Shock - a historic one.
