Many of you have already seen this Reuters news report, but it's significant enough to warrant highlighting and some commentary. In fact, it can be argued that this is an over statement of direct confrontation between China and the Obama Administration: U.S. is currency war's "tomb maker" -China economist
"The dollar's depreciation may appear to be market-driven. In reality, it is a depreciation coloured by very strong, deliberate actions," Li said in the paper, which serves as the chief mouthpiece of China's ruling Communist Party.Here's the link to the news report in case you have not seen it: China's Warning Shot
Up to this point acknowledgement of the nascent global currency war, led by the United States, has been largely relegated to commentary and debate in the various internet forums, blogs and truth-seeking media outlets (King Word News, LemetropoleCafe.com etc).
With this publicly overt, front-page statement issued to the world by the Chinese Government, China has elevated this global financial conflict into the dangerous realm of visible sovereign rhetoric and conflict. Not only has China thrust the issue of competitive currency debasement into full public view, but it has pointed out the obvious attempt by the United States to make - via aggressive, motivated dollar devaluation - its uncontrolled borrowing and spending problems the problem of the world:
"If the global financial crisis was about nationalising private debt, then in the post-crisis period the urgent need of the United States is to internationalise its national debt," he said.Make no mistake about this. With this front-page statement by the Chinese Government via this Chinese economist, China is directly engaging in a war of rhetoric that could well polarize the global community into the emerging market "wants" and the Western developed countries who "had it and are losing it." See the above quote from Hemingway if you are curious about how this could eventually play out...
Helicopter Ben Starts The Engines - On A Whole Fleet Of Money-Dropping Helos
Bernanke Sees Case for `Further Action' With Too-Low Inflation Here's the article: LINK
Yesterday the primary dealers were the primary buyers of the long-bond auction. Wall Street took down a stunning 59% of the entire auction. This is not bidders going thru Wall Street. This is direct monetization of the Treasury auction. This is so-called Quantitative Easing - "sterilized" money printing - because the Fed, indirectly through the banks - has taken in an asset against the electronic issuance of currency. I also believe that the Fed - although I don't have time to run through the "forensic" work to prove it outright - is also outright increasing the money supply without taking "assets" onto its balance sheet (I use "assets" because most of the toxic garbage the Fed has assumed is worth 10 cents on the dollar at best).
You guys can read the news release, but please understand that this statement implies that Bernanke is getting ready to monetize the mortgage crisis:
He said the central bank could expand asset purchases or change the language in its statement, while saying “nonconventional policies have costs and limitations that must be taken into account in judging whether and how aggressively they should be used.”So there it is. The Fed will print money electronically, buy the fraudulent mortgage paper from Bank of America et, al. AND thanks to the deal Wheelin' Dealin Tax Cheatin' Tim Geithner cut with the Fed on behalf of the Taxpayer, ultimately the middle class taxpayers who still work and do not feed off the Government breast of food stamps and the interminable unemployment benefits will end up paying for this mess. My bet is we collapse before this all actually unfolds.
Most of you have likely seen this chart, which was posted ad nauseum around the internet yesterday. But this is one of those pictures that has a 1000 words. I added just 22 of my own to emphasize the point of the chart (thanks to Sprott Asset for sharing that with the world):