Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Central Banks and The Dollar Hitting the BRICS

Politics / Emerging Markets Jul 18, 2014 - 02:36 PM GMT

By: Dr_Jeff_Lewis

Politics “We are pleased to announce the signing of the Treaty for the establishment of the BRICS Contingent Reserve Arrangement (CRA) with an initial size of US $100 billion. This arrangement will have a positive precautionary effect, help countries forestall short-term liquidity pressures, promote further BRICS cooperation, strengthen the global financial safety net and complement existing international arrangements.... The Agreement is a framework for the provision of liquidity through currency swaps in response to actual or potential short-term balance of payments pressures.”


Parallel phenomena are trickling their way up from the darkness in monetary sentiment. It may be symbolic for now, but the politics in the U.S. with the symbolic and the organizing structure of alternative reserve currencies represent yet another shift toward a phase transition in dollar confidence.

The BRICS and Their $3 Billion

Ultimately, these BRIC- sovereigns are acting the same as any prudent investor.

They are diversifying. They are venturing out as a natural consequence of the dollars fading preeminence.

They are attempting to reduce dollar exposure. But they are also testing the limits.

They can't do it too fast, or they will miss the opportunity.

And then there was this...

End the Fed whispers, political limits of printing coincide with the final frontier of fiat.

Earlier this week, politicians proposed a bill that would limit the powers of the Federal Reserve.

The actions this week by House Republicans indicate that there is a legitimate risk that the Fed "may reach the political limits of money printing."

This is a bit late and purely symbolic.

The Fed is fully captured by the Treasury.

Politics will not stand for deflation - as it would destroy the banking system and the elite oligarchs.

It is the same issue with the debt ceiling. The debt ceiling can never be permanently removed without triggering the end of what is left of dwindling confidence in the dollar.

Everyone knows we are in a currency war - but no one "wants" to understand in a visceral way.

But it’s too late. Bailouts will happen again to the surprise of everyone, including lawmakers.

Confidence is like skin in the game and the current financial system is the poster child for the absence of flesh.

Which isn't much of a stretch considering that the entire house of cards is based on debt and confidence to begin with.

The inflection point will come and change everyone's perspective all at once.

At this point it is like attempting to explain certain phenomena that can only be experienced on a personal sense in order to fully embrace it.

I have spent a lifetime in the ocean, surfing in large swell conditions.

My home beach is a typical beach-break set up. Exposed to open ocean energy. Waves break along outer sandbars and come straight in toward the beach. The journey to the outside where wave energy first reaches outer sandbars is often a brutal ordeal.

One faces rolling trains of exploding energy in sets of 10 or more a few seconds apart - and no channel around them.

It requires a lot of patience, endurance, and a bit of strategy and luck.

Much like being a long term physical precious metals investor enduring decades of blatant manipulation and very little reward.

The rest of the world has a different idea of surfing. Dreams of lifestyle and a different idea of money and currency.

The rest of the world partakes in a point break, where waves gently wrap around an elbow of land and anyone can access the impact zone by paddling around the inside.

This can be dangerous because too soon people often find themselves in a situation that in reality is much different than what they originally planned for.

Mike Tyson is often attributed with the expression "Everyone has a plan when they step into the ring...until they get hit in the face."

There is an advantage to paying dues - with skin in the game; especially when it comes to the phase transition.

The Black Swan will be like the first punch in the face. Most think they will see it coming and have time to react. The reality is always different.

All of the bubbling exuberance we see - what appears to be a slow tributary often relegated to the fringe, is just part of a larger phenomenon. The fall of paper currencies will occur gradually and then arrive all at once in one big confusing geometric collapse that no one saw coming except for a tiny few.

For more articles like this, and/or for a breath of fresh silver market reality amidst the stench of denial and technically meaningless short term price obsessed madness, check out http://www.silver-coin-investor.com

By Dr. Jeff Lewis

    Dr. Jeffrey Lewis, in addition to running a busy medical practice, is the editor of Silver-Coin-Investor.com

    Copyright © 2014 Dr. Jeff Lewis- All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Dr. Jeff Lewis Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in