The Pursuit of a Multi-Currency System

JC CollinsEconomics, Premium POM9 Comments

A Fear-Free Analysis

By JC Collins

Back in 2011 the World Bank published a report titled Global Development Horizons – Multipolarity: The New Global Economy (GDH2011). In that report it laid out three potential scenarios for the future framework of the international monetary system. These three scenarios were:

Status quo of the USD based framework.
A multicurrency system which better reflects the realities of the emerging economies.
An SDR based reserve system.
It was decided that scenario two, a multicurrency system, would offer the best opportunity to rebalance the international monetary system and contribute to global growth. Under this option the USD could remain at the head of a multicurrency system for a longer period of time. This would make such a transitioning multicurrency system stable as wealth incrementally shifts from the developed economies to the developing, or emerging, economies.

The Petro-Renminbi Emerges

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China & Saudi Arabia to End Dollar Pegs + China’s New Crude Benchmark Index

By JC Collins

It would appear that an agreement of sorts has been reached between world powers over the last week or so. This would correspond with the annual World Economic Forum meetings in Davos, Switzerland. Not to mention that Chinese President Xi Jinping and King Salman of Saudi Arabia also met and released a communique titled “Comprehensive Strategic Relationship”, along with another “senior Chinese official” affirming that it is the intention of the People’s Bank of China to “decouple” the renminbi from the US dollar.

Over the last few days a list of interesting things has taken place on the geopolitical front. First, Saudi Arabia came out and stated its willingness to work with Iraq and Russia on making cuts to crude production. Second, Israel is throwing Turkey under the bus and openly stating that ISIS has benefited from oil sales to Istanbul. Third and fourth are the above mentioned Communique, and statement by a senior Chinese official in Davos, regarding the exchange rate arrangement with the US dollar.

A Hidden Mystery (FREEPOM)

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The 12+1 Symbolism of the Federal Reserve System

By JC Collins

“A Federal Reserve Bank is a regional bank of the Federal Reserve System, the central banking system of the United States. There are twelve in total, one for each of the twelve Federal Reserve Districts that were created by the Federal Reserve Act of 1913.” – From Wikipedia

“The number twelve frequently occurs among ancient peoples, who in nearly every case had a pantheon consisting of twelve demigods and goddesses presided over by The Invincible One, who was Himself subject to the Incomprehensible All-Father. This use of the number twelve is especially noted in the Jewish and Christian writings. The twelve prophets, the twelve patriarchs, the twelve tribes, and the twelve Apostles – each group has a certain significance, for each refers to the Divine Duodecimo, or Twelvefold Deity, whose emanations are manifested in the tangible created Universe through twelve individualized channels.” -Manly P. Hall, The Secret Teachings of All Ages

In the ancient mysteries there is a ritualistic procession which describes the path from confusion and despair to enlightenment and exultation. This process places the individual, or groupings of individuals, such as nations, on a journey of hardship and suffering, only to come out the other end liberated and illuminated.

Surviving the First Fed Rate Increase

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By JC Collins

It looks like things may be settling down after the first Federal Reserve rate increase in almost a decade. The volatility was expected and there will be more to come. Contrary to doom and gloom reports and the constant propaganda of everything is horrible and the end is near, global markets are rebounding and the price of crude is beginning to rise.

Whether the low this week constitutes the low from which further appreciation will be based on is challenging to determine. The deflation which has been taking place internationally has not yet ran its full course. More will come. More will come after each rate increase.

The Fourth Wall (FREEPOM)

JC CollinsCultural, FREEPOM22 Comments

By JC Collins

Where is the warmness of that lost innocence?

Mother, why did you leave me here amongst the smoking ruins of this place?

This place.

Place.

Space in-between.

Gasp.

The emptiness.

After four days of aptitude testing I was walked into a room with a large desk. Behind the desk sat a military psychologist who politely greeted me and told me to take a seat. He reeked of Aqua Velva and cigarettes.

“Thank you for spending the week with us,” he said.

Let the Debt Defaults Begin

JC CollinsEconomics, Premium POM16 Comments

By JC Collins

As with any major monetary transition, there will be a period of volatility and unwinding as the international monetary system rebalances towards the multilateral framework. The ongoing up and down of markets and valuations over the last few weeks will soon shift into debt defaults and corporate bankruptcies.

How bad this gets will depend on the political willingness to accept the larger and more macro debt restructuring mechanisms which are sure to follow on the heels of increasing volatility and political uncertainty.

One only need to look at the daily price swings for gold. A $25 daily swing is becoming common as the price of gold swings up and crashes back down again. This pattern keeps repeating throughout all markets. Commodities, especially crude, just keep grinding down further and further.

Don’t Fear a Crash of the Dollar

JC CollinsEconomics, Multilateral Investment Strategies, Premium POM16 Comments

Dollar Depreciation and Renminbi Appreciation
By JC Collins
Last July I published a post predicting that the US dollar would begin to depreciate at the beginning of 2016. This date range was based on the effective inclusion date of the Chinese renminbi in the Special Drawing Right Basket (SDR) of the International Monetary Fund.
Other factors which were considered was the eventual passing of the 2010 IMF Quota and Governance Reforms in the US Congress, which did in fact happen as predicted by the end of 2015.
The start date of the Asian Infrastructure Investment Banks (AIIB) and the BRICS New Development Bank (NDB) also helped determine the date range provided. The AIIB just celebrated its official launch and it was communicated that the first infrastructure loans would be issued in the second half of 2016.

Über Cool (FREEPOM)

JC CollinsCultural, FREEPOM25 Comments

Consolidation through the Expansion of Worldwide Socialism

By JC Collins

The World Economic Forum is publishing a study which states that 5 million jobs will be lost to advances in artificial intelligence, robotics, genetics, and other advancements by the year 2020. This study correlates well with other policy papers by some banks and international institutions which suggest that 80% of human jobs will be replaced by 2030 or 2040.

There are some obvious questions which arise. What will replace these lost jobs? How will humans earn a living when there are no jobs to replace the ones which have been taken over by Robbie Robot? And how does this connect to the multilateral monetary transition?

The Gears Are Grinding Down – Redux

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By JC Collins

The post was originally published on January 20, 2015.

It has become common knowledge in the mining industry here in Canada that the large oil companies began holding strategy sessions over a year ago to address this downturn in the market. The “sustainable cost reduction strategies” were slow in coming at first but are now being developed and implemented from one day to the next.

The industry is witnessing layoffs in the tens of thousands with more to come. For each energy sector job lost there will be 4 or more service industry jobs lost as well. This spider web of cause and effect will mean a slow down in the broader economy with reduced revenues for everything from local pubs and restaurants, to clothing stores and regional manufacturers.

The Coming Islamic Revolution in Saudi Arabia

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A Closer Look at a Strategy of Maintaining Production alongside Declining Reserves

By JC Collins

It is common for companies faced with financial hardship to run as long, hard, and fast as they can for cash. There are many companies today which have employed such a strategy in this latest downturn in crude prices and increasing world-wide deflation. But applying such a strategy to a state, or perhaps a monarchy, is not something which most analysts would consider.

The actual reserves held by Saudi Arabia are not a very well-kept secret. The kingdom has done its best over the years to confuse the world as to its actual petroleum reserves, but most in the industry are well aware of the fact that the reserves are in decline. Saudi has been investing in alternative sources of energy, alongside China, which is extremely telling of the efforts and planning which the House of Saud is implementing as a strategy to offset declining petroleum revenue.