Trade war or not New York bankers will have it their way

President Donald Trump is seen at his desk in the Oval Office. Sometimes he works hard, for the…bankers. (Official White House Photo by Shealah Craighead)

The US and China agreed to hold talks on 7-8 January in Beijing to settle their trade differences, which have already eaten into both economies and disturb the global financial universe. If they fail to agree this week, the impact will be worse. It seems things are so bad, that the US Federal Reserve Chairman Jerome Powell was forced to back down from his long term plans to further raise Fed’s interest rates.

According to Reuters, he said “the Fed would be flexible in deciding future interest rate hikes, balancing the steady flow of strong economic data against an array of risks, from slowing global growth to worries about trade, that have spooked investors”. Before discussing the Chino-American trade war, let’s dig a bit into the American monetary developments.

Powell changes course

Right from his nomination as Fed Chairman, Powell has been defending the need for more interest rates hikes because of the “steady flow of strong economic data”. This reality may lead to strong inflation pressures. Nevertheless, last Friday, he bowed before the screams of ‘investors’ and left it to be understood he will “be patient” with Fed’s monetary policy, signalling a hold of interest rates increases. Actually, he went as far as to say “We are always prepared to shift the stance of policy and to shift it significantly, if needed”. This means instead of increases the Fed may launch rate cuts.

Clearly, it was the mammoth New York banks, who forced Powell to think twice before making them pay a bit higher interest on around $4 trillion the Fed has pumped into the banking system (it should have been real loans if the banks paid any noticeable interest rate for that). Even worse, the banks now demand that the Fed even lowers its 2.25% rate. For years – from 2008 to 2016 – this rate had been flat zero, to ‘help’ the banks recuperate from the financial meltdown their insatiable greed for money had inflicted upon the real economy.

Again it’s the banks

Yes, the New York banks feed on other people’s money. Last Friday 4 January, just the possibility of lower or at least steady Fed interest rates sent the S&P and the Dow Jones – the Wall Street stock market main indexes – to the sky up by 3.43% and 3.29% respectively. The Fed’s money is American people’s money which the major US banks get for free or for a token interest rate. Then, they lend it at interest rates averaging of more than 10%, making huge profits without sweating or any proper risk taking. If they fail, the taxpayers will certainly bail them out.

This is exactly what happened in 2008 and will happen again soon. Free or cheap money in the hands of bankers still continues being ‘invested’ in all and every grey derivative or high risk markets. For example, Turkey pays the New York bankers 14% on dollar loans. However, the country may not be able to continue doing so in the future. Then, it will be the US taxpayers who will undertake the burden to save the imprudent bankers, acting as their insurer of last resort. No charge for that whatsoever.

Trump backs bankers

Of course, the banks are not alone in exploiting the real economy and the real people. The impossible ‘America First’ President, Donald Trump is spearheading the bankers fight against Jerome Powell’s efforts to get something back, from what the Fed has freely given them. The White House has repeatedly attacked Powell for continuing to apply the absolute necessary monetary measures which his predecessor Fed head Janet Yellen introduced in 2016.

Trump has repeatedly threatened to fire the Fed Chairman and now the White House war against him has started paying…dividends for bankers. So, last Friday Powell finally accepted to back down from his own policy choices and succumbed to the demands of bankers and Trump for cheaper money.

The Wall St. sharks

The political harlequin of Washington D.C., who promised the ‘left behind’ Americans to actively work for them, is now doing whatever he can to support the major US banks and the Wall Street sharks to continue feeding on the real American economy. At the same time, Trump’s unprecedented trade attacks, mainly against China, have started affecting the real US economy. This brings us to the meeting point of global trade grievances and the Fed’s interest rates.

For weeks, even months, the New York Stock Exchange has been plummeting, with the Wall Street magnates blaming global trade troubles. Last Friday, however, a Powell statement, announced preparedness for a significant shift in monetary policy. This means cheaper charges for the $4 trillion banks have got from the Fed. That’s why the NYSE partied. As noted above, S&P rose by 3.43% and the Dow by 3.29% celebrating the new era of cheaper money.

The trade wars

This is all the banking sharks care about; pocketing Fed’s money, that is, American people’s money, cheaply or even free of charge. They don’t care if Trump’s trade attacks against China have started eating into the US real economy. Theirs is the financial universe preying on the same real economy. Their ‘earnings’ stem not from labor or industry or risk taking of any kind, but rather from their sovereign grip and absolute control of whatever has to do with money. Actually, they create their own money, piles of it.

In conclusion, the NYSE and mammoth banks don’t care if a real trade war erupts with China or the European Union, as long as it doesn’t touch their ability to feed on other people’s money. Trump does his best in this direction, possibly not without important personal gains. Trade war or not, the New York bankers will have what they want.

 

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

Stopping antimicrobial resistance would cost just USD 2 per person a year

The Banking Union may lead to a Germanic Europe

Youth policy in Europe not delivering for young people

IMF: Sorry Greece it was a mistake of 11% of your GDP

Why lay people don’t expect anything good from G20

Pesticides: MEPs propose blueprint to improve EU approval procedure

The Commission neglects the services sector and favours industry

South Asia can become an innovation hub. Here’s how

These 4 Nordic countries hold the secret to gender equality

China in My Suburbs

Earthquake: Monte Dei Paschi Di Siena

UK must make clear what it wants, MEPs say in Brexit debate

G7 summit: Trump Vs. G6 leaders on trade and climate change

Why a healthy planet and a healthy economy go hand-in-hand

Snowden is the “EU nomination” for this year’s Oscars

The challenge of maintaining interest in Primary Health Care in medical students

Cocaine and opium production worldwide hit ‘absolute record highs’ – major threat to public health says UN study

ECB readies itself for extraordinary monetary measures defying Germany

UK Labour Party leader Corbyn readies to change Brexit political backdrop

2019 EU Budget: Commission proposes a budget focused on continuity and delivery – for growth, solidarity, security

Online government services could change your life. But only if you have access to the internet

UN forum to bring ‘big space data’ benefits to disaster response in Africa

Use “blockchain” model to cut small firms’ costs and empower citizens, urge MEPs

Close to final agreement on the EU Banking Union

UN chief welcomes event reuniting families on the Korean Peninsula

EU-U.S. Trade Talks: European Commission presents draft negotiating mandates

Financial Transaction Tax: More money for future bank bailouts?

China, forever new adventures

MEPs agree on new rules to tax digital companies’ revenues

Ship Recycling is the Commission’s Titanic

Dreaming of China

Drought in Europe: Commission presents additional measures to support farmers

Young? You should work out the entrepreneurial heart before the mind

Quicker freezing and confiscation of criminal assets in the EU

Third Facebook-Cambridge Analytica hearing: data breach prevention and cures

Draghi’s 2018 compromise: enough money printing to revive inflation and check euro ascent

Why do medical students have to emigrate to become doctors in 2017?

Poverty data never tells the whole story

Spotlight Initiative – EU and UN fight against domestic violence in the Pacific region

Top UN political official updates Security Council on Iran nuclear deal

Stigmatized, shunned and shamed, International Widows’ Day draws attention to their unique needs

Our present and future tax payments usurped by banks

Commission caps charges on card and Internet payments and enforces competition

Greater support needed for refugees and migrants from Venezuela – UN

China’s cities are rapidly becoming more competitive. Here’s why

Fresh airstrikes kill dozens in conflict-ravaged Syria

EU Commission: The banks are not obliged to finance the real economy

Climate change is speeding up. Our response needs to be even faster

The West – the EU and the US – is writing off Turkey’s Erdogan

The New Year 2016 will not be benevolent to Europe

Everybody against Japan over yen’s devaluation

Syria: UN-backed watchdog says chemical weapon ‘likely used’ in February attack

Presentation of Juncker’s Investment Plan: Can 315 billion euros save the EU?

Brexit: the time has come for the UK to clarify its position

Here are 4 tips for governing by design in the Fourth Industrial Revolution

The Parliament paves the way for the creation of the European Banking Union

Top envoy to Yemen praises ‘flexibility’ of chief negotiators as new UN mission chief is named

Rising landmine blast toll in Afghanistan highlights long-term care needs of survivors

EU budget: Commission proposes most ambitious Research and Innovation programme yet

Capital Markets Union: Making it easier for insurers to invest in the real economy

Moves to create a Kosovo army have ‘deteriorated relations’ with Serbia: UN peacekeeping chief

More Stings?

Trackbacks

  1. […] Continue reading full story: Trade war or not New York bankers will have it their way […]

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s