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.

 

the sting Milestone

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

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

Mergers: Commission clears acquisition of Refinitiv by London Stock Exchange Group, subject to conditions

The world wide web is 30 years old. What better time to fight for its future?

UN humanitarian coordinator condemns Central African Republic hospital attack as ‘inhuman and unworthy’

Coronavirus: EU guidance for a safe return to the workplace

Polish de facto ban on abortion puts women’s lives at risk, says Parliament

ECB indicates south Europeans can endure more austerity

Protecting the Treaties in the interest of all Europeans: the College takes solemn oath to serve the EU

What is adversarial artificial intelligence and why does it matter?

Three ideas for leaders to be more successful in the 21st century

This root vegetable could help alleviate hunger and end soil erosion. Here’s how

Why are the financial markets shivering again?

The Commission tries to stop the ‘party’ with the structural funds

“America first” policy goes against EU-US partnership, say MEPs

Innovation can transform the way we solve the world’s water challenges

Anti-vaxxers are hurting vaccination campaigns. We need to fight back

Here are three ways Africa’s youth are defeating corruption

How to Create a Clear Vision For the Future of Healthcare

UN chief condemns deadly attacks in Afghanistan

The EU tells the bare truth to the UK that there is no such thing as easy divorces

EU-China Leaders’ meeting: Delivering results by standing firm on EU interests and values

How blockchain can manage the future electricity grid

Workplace bullies could now go to jail in South Korea

Here are 3 ways venture capital can fund a better future

Von der Leyen in Ireland: Our mutual solidarity is here to stay

Human rights in Brussels and in Beijing: a more balanced approach needed

The UK is on a record-breaking run of coal-free power

4 things to know about the state of conflict today

Health privatization to blame for health inequality or poor investment in public health?

EU imposes provisional anti-dumping tariffs on Chinese solar panels

These scientists are using sound waves to filter plastic fibres from washing machine wastewater

Elections in Britain may reserve a surprise for May’s Tories

COP21 Breaking News_05 December: Ban Ki-Moon Closing Address at COP21 Action Day Innovation, Imagination, Faster Climate Action

The Challenger Within – Mental Health In Romania During Lockdown

Ramp up nuclear power to beat climate change, says UN nuclear chief

UN chief urges top digital tech panel to come up with ‘bold, innovative ideas’ for an ‘inclusive’ future

We need to talk about how we define responsibility online – and how we enforce it

World Cancer Day: Early cervical cancer diagnosis could save lives of over 300,000 women

Tools of asset development: Renewable Energy Projects case

EU lawmakers vote to reintroduce visas for Americans over “reciprocity principle”

Guterres underlines climate action urgency, as UN weather agency confirms record global warming

Is history a new NATO weapons against Russia?

How to describe chronic pain beyond numbers? A Brazilian measuring instrument

Greferendum: the biggest political gaffe in western modern history to tear Europe apart? #Grexit #Graccident

Brexit: MEPs concerned about citizens’ rights

EU Trust Fund Bêkou for the Central African Republic extended until 2020

Addressing the challenges of COVID-19 vaccination

UN standing with Zimbabwe, Malawi, Mozambique as Southern Africa death toll from deadly cyclone mounts

Here’s why infrastructure will make or break our response to climate change

State aid: Commission approves €300 million public support for the development of ultrafast broadband network in Greece

Next time you fly, could you be boarding a train instead of a plane?

Youth leaders share positive visions of the future, as Guterres launches UN75 in New York

This Norwegian cruise line plans to power its ships with rotting fish

Chatterbox Rome Declaration cannot save the EU; Germany has to pay more to do that

Gaza probe finds ‘reasonable grounds’ Israeli forces committed international human rights violations

EU summit: No energy against tax evasion and fraud

Newly displaced fleeing attacks in northeast Nigeria, top 2,000

Why building consumer trust is the key to unlocking AI’s true potential

UN Human Rights chief urges Venezuela to halt grave rights violations

Innovative urban financing can make our cities stronger

At this Italian bookshop, children swap their recycling for something to read

More Stings?

Advertising

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