Here Come the SDR Bonds (FREEPOM)

Economics, FREEPOM5 Comments

A Part of the Solution to the Problem of Global Growth

By JC Collins

Over two years ago now I began a series of articles titled SDR’s and the New Bretton Woods. The ten post series focused on the SDR and its eventual evolution into an internationally traded asset. There was very little information out there at the time on this future transformation of the IMF’s Special Drawing Right currency, and POM broke new ground on many of the facts, trends, and methodologies behind the transition to a multilateral monetary framework.

Each month more and more information and confirmation of the POM thesis emerges which further validates much of what has been presented to readers for over two years. The latest validation comes from the G20 Communique from last weekend’s summit in Shanghai.

China and the TPP

Economics, Premium POM

The Integration of Western and Eastern Trade-Blocs

By JC Collins

Last week a special United States-ASEAN summit was held in California. The purpose of the meeting was to align trade strategies and have all members of the ASEAN trade bloc join with the Trans-Pacific Partnership.

In October of 2015 I wrote a piece titled TPP and the AEC – Parallel Trade Agreements. In that post we reviewed how the TPP and the ASEAN Economic Community were two parts of the one hinge which acted as the point of integration between the United States and China within the multilateral monetary framework.

From that post:

“There is as much confusion and misinformation about the relationship between the Trans-Pacific Partnership (TPP) and the ASEAN Economic Community (AEC) as there has been regarding the integrated relationship between the International Monetary Fund and the Chiang-Mai Initiative Multilateral, and to a larger extent, the BRICS led institutions.”

Aloha from the South China Sea (FREEPOM)

Cultural, Economics, FREEPOM, Geopolitical, Multilateral Investment Strategies9 Comments

Chinese Capital Outflows and the Buying of American Business Interests

By JC Collins

Early last year the Chinese government threatened the United States with funding and arming Hawaiian independence activists who want to restore the islands’ constitutional monarchy. The story passed with little fanfare until just days ago when the Chinese made a comparison between setting up defensive arms on the man-made islands in the South China Sea, to the US establishing military facilities on the Hawaiian Islands.

Are the G20 Nations about to Depreciate the US Dollar?

Economics, Premium POM

By JC Collins

There are increased discussions taking place between the G20 finance ministers and central bank governors that a decision should be made at this weekend’s meetings in Shanghai to depreciate the US dollar against select currencies. The meetings, which are being held on February 26th and 27th could very well signal the beginning of the exchange rate transition which we have been reviewing here on POM for the last two years.

As we have thoroughly covered, the increasing global deflation and slowing growth would act as the monetary and financial catalyst to spur the economic reforms and promote the required monetary policy changes to support the multilateral framework. This is exactly what is now taking place.

Has the “Made in America” Dollar Depreciation Begun?

Economics, Premium POM

Just as American Exports Are Set to Explode

By JC Collins

When we hear that the Chinese renminbi has depreciated against the US dollar we automatically think that the RMB is weakening everywhere. After all, the USD is the global benchmark on currency valuation. But we need to consider that the renminbi’s valuation is also based on a basket of trade weighted currencies. (See post China Just Ended the Dollar Peg…for the most part) Under this exchange regime the RMB has remained stable, even though Chinese monetary authorities have lowered the daily fixed rate against the dollar.

Over the last few days the dollar has been depreciating, which has caught many by surprise. Most POM readers will understand that this depreciation of the dollar has been expected, and in fact, has been a strategy of the both the Federal Reserve and the US Treasury for many years now.