Saturday, August 27, 2016

EES: One World Currency introduced by The Cartel - Settlement Coin

Well, it finally happened.  Mark your calendars for the year 2016 as 'the year' a real One World Currency has been announced.  But don't worry - as we explain in Splitting Pennies - Understanding Forex - MONEY DOESN'T EXIST.
How is it possible, you say - when we haven't heard about it in the news?  Let's start with the 'lead' story on this breaking event:
UBS, Deutsche Bank, Santander and BNY Mellon have partnered up to create a new digital currency to facilitate intra-bank settlements, the FT reports. The cryptocurrency will use blockchain technology underpinning the Bitcoin.
Why is this different than any other Bitcoin startup - there sure have been many.  Because these are the banks that control the global currency market, also known as AKA 'the cartel' according to court documents.  
Checkout some of the stories leading up into this climatic moment:
So why does any of this matter?  Central Banking policy has run the global economy into the ground.  Central Banks OWN $25 Trillion of Financial Assets.  $13 Trillion worth of Government Bonds in the world have NEGATIVE YIELDS.  The financial system as it is now, is on the path for implosion. 
Settlement Coin apparently is targeting 'back office settlement' to reduce costs which are about $80 Billion per year.  But why then does RT compare it with SDRs:
If implemented, the new cryptocurrency would be the first to be used officially between major financial institutions. The concept resembles the IMF’s Special Drawing Right (SDR), introduced in 1964. Based on a basket of currencies (the US dollar, euro, the Japanese yen, pound sterling and the soon to be joined Chinese yuan this October), it is used to supplement the IMF’s member countries’ official reserve. As of March 2016, 204.1 billion SDRs equivalent to about $285 billion had been created and allocated to countries.
Has the world gone mad, and people don't understand the difference between "Blockchain" and "Bitcoin" and "Cryptocurrency" and "US Dollars" ?  We have to note here, RT needs to hire some "Forex Experts" to consult with their authors on this topic.
To clarify, the big banks are working on multiple blockchain projects, as well - most of them have filed patents for their own crypto currencies, most notably, Citi: 
Citi Research released a 56-page report [LINK REDACTED 6/21/2017] on bitcoin saying that it is not going to disrupt banks or credit card networks. It says there will be increased transaction costs for bitcoin to provide increased volume. As for the use of bitcoin in remittance payments, it says bitcoin’s advantage dissipates when the “last mile” cost of converting to fiat currency is considered. The report notes the growth of bitcoin mobile apps in developing countries but sees regulations rising that put them in question. It claims existing payment systems are generally efficient. The report also talks about Ripple and Ethereum as well as government-backed digital currencies. There is also an extensive summary of bitcoin’s legal status in different countries.
Once implemented, these banks have the means to quickly connect this new cryptocurrency "Settlement Coin" to their existing global network, as well as adding their own proprietary currencies such as "CitiCoin."
It will take some time before the cryptocurrency is even released, and still probably years before it's widely accepted.  What makes this week's announcement unique is that, for the first time the banks publicly announced they are making a new digital 'crypto currency' that isn't issued by a central bank, that can be implemented by them across and without borders, which is a perfect fit for a replacement of the US Dollar and other fiat currencies when they completely run out of QE steam.
But here's the real clincher, exposing this as a real One World Currency:
One of those resources is the real-time gross settlement (RTGS) system used by central banks (it's typically reserved for high-value transactions that need to be settled instantly), and the other is central bank-issued cash.  Using the Utility Settlement Coin (USC) unveiled today, the five-member consortium that has sprung up around the project aims to help central banks open-up access to these tools to more customers. If successful, USC has the potential to create entirely new business models built on instant settling and easy cash transfers.  In interview, Robert Sams, founder of London-based Clearmatics, said his firm initially worked with UBS to build the network, and that BNY Mellon, Deutsche Bank, ICAP and Santander are only just the first of many future members.  "Cash is a leg to almost every trade," said Sams, who previously worked for nine years as a derivatives trader with Sanctum FI, also in London. "In order to get most of the benefits of a distributed ledger in settlement, there has to be cash on a distributed ledger rail."  How transactions might be processed, and who will own the nodes, has also not been shared. But what we do know based on a statement from the company is that Clearmatics described the USC as "a series of cash assets" for currencies, including US dollars, euros, British pounds and Swiss francs.
For those who understand that it's monetary policy driving the value of currencies down, not supply and demand, there's no need to read between the lines - they spell it all out real simple.
For a quick primer for those who don't know, the Federal Reserve is the sole issuer of US Currency (not the US Mint, who prints notes and coins.)  The Federal Reserve is a private institution, owned by the banks.  It was previously thought that, the idea of a one world currency was preposterous, because, how would all countries agree on having a single central bank?  But here's the workaround - the Forex banks have a monopoly on the global monetary system.  So by forcing their central bank partners to use "Settlement Coin" in order to save on hefty settlement fees (and it will solve the problem of the recent SWIFT hacks as well - part of the plan??? )
A few scenarios here - one, the banks knew that if they didn't do it, some new players might do it.  Two, this plan was hatched long ago by some clandestine CIA op, starting with the release of Bitcoin, leading into the global one world cryptocurrency, all sponsored by Illuminati.  Three, central banks have legitimate concerns about security (such as because of recent hacks) and have no real way out of QE, they can't stop it and they can't continue it.  This is a parallel financial system in which assets can be transferred over to.
To learn more about Forex, checkout Splitting Pennies - the pocket guide to make you an instant Forex genius!  If you're a non-US citizen or Pension Fund looking for a real Forex investment with a proven track record, checkout Magic FX Strategy.  

Toward a Global Realignment

As its era of global dominance ends, the United States needs to take the lead in realigning the global power architecture.
Zbigniew Brzezinski is a counselor at the Center for Strategic and International Studies and was the National Security Advisor to President Jimmy Carter from 1977-81. He is the author, most recently, of Strategic Vision: America and the Crisis of Global Power.

Friday, August 26, 2016

Big banks buckle down to build better bitcoin

UBS, Deutsche Bank, Santander and BNY Mellon have partnered up to create a new digital currency to facilitate intra-bank settlements, the FT reports. The cryptocurrency will use blockchain technology underpinning the Bitcoin.
The banks are working with London-based blockchain startup Clearmatics, and the official launch is expected in 2018, according to the media.
“Today trading between banks and institutions is difficult, time-consuming and costly, which is why we all have big back offices. This is about streamlining it and making it more efficient,” Julio Faura, head of R&D and innovation at Santander told the FT.
All four banks are members of the 50-strong R3 consortium of financial institutions exploring ways of blockchain usage in the financial system.
“You need a form of digital cash on the distributed ledger in order to get maximum benefit from these technologies. What that allows us to do is to take away the time these processes take, such as waiting for payment to arrive. That frees up capital trapped during the process,” said Hyder Jaffrey, head of financial technology innovation at UBS.
According to a report by a consulting firm Oliver Wyman, the world spends up to $80 billion every year to clear and settle trades.
This post sponsored by LIQUID CLAIMS

Thursday, August 25, 2016

"Central Banks Now Own $25 Trillion Of Financial Assets"

With 85% of Wall Street telling Citi they expect a "dovish hike signal" from Yellen tomorrow, which means a polite request for another BTFD opportunity, even if as BofA says "expectations for a dovish Fed are coinciding with macro strength in the US (most obviously in housing & consumer spending) as well as highest level of wage inflation since Jan’10"...
... here is a quick reminder of where we currently stand from BofA's Michael Hartnett, from a brief note titled The Liquidity Supernova & the "Keynesian Put."
* * *
Risk assets are now supported by the new ”Keynesian Put”, the expectation that fiscal measures will be deployed to combat any renewed weakness in the economy/markets (independently of any larger political projects). But asset prices remain primarily supported by excess monetary abundance across the world:
  1. There have been 667 interest rate cuts by global central banks since Lehman;
  2. G7 central bank governors Yellen, Kuroda, Draghi, Carney & Poloz have been in their current posts for a collective 17 years, yet only one (Yellen in Dec’15) has actually hiked interest rates during this time;
  3. Central banks own $25tn of financial assets (a sum larger than GDP of US + Japan, and up $12tn since Lehman);
  4. There are currently $12.3tn of negative yielding global bonds (28% of total);
  5. There is currently $8tn of negative yielding sovereign debt (54% of total).
Do not expect any unwind of this $25 trillion in risk asset support to be unwound any time soon, or perhaps ever, or else...
The Crab Nebula supernova

YOUR POCKET GUIDE TO BE A FOREX GENIUS - SPLITTING PENNIES


Blockchain Pitched as Way to Simplify FX Trading Databases

A year-old technology firm wants to simplify currency markets by streamlining the way trading data is stored using blockchain-based technology.
Cobalt DL, a London-based firm created last year by former Traiana Inc. Chief Executive Officer Andy Coyne, announced Wednesday that it began beta testing on a distributed ledger network, which the firm hopes can cut post-trade costs and provide a singular database for foreign-exchange transactions. Set to launch in 2017, the network will create a single record for each trade.
“The execution in the FX markets over the last 10 years has really accelerated,” Coyne said. “If you’re not simplifying, if you’re not taking the opportunity to recreate the whole shared trade system, I think you’re missing an opportunity.”
The platform, according to a statement, is expected to save “billions of dollars” for market participants by avoiding things like charges for ticketing, staffing and licensing. Currently, many are burdened by having to maintain multiple systems and layers to maintain records, Coyne said.
The network will use blockchain concepts like encryption and digital signatures to create the unified system. Blockchain, the software that powers bitcoin, is a type of distributed database that’s being touted as a way to upend the financial industry.
Cobalt already has eight “leading institutional FX participants” signed on to use the system. The firm declined to specify the firms. The announcement comes 18 months after Coyne left Traiana, which was owned by ICAP Plc, an independent brokerage firm that provides a similar system.

For more FX info checkout Splitting Pennies - Understanding Forex

Monday, August 15, 2016

Will Ireland Be First Country In World To See Bail-in Regime?

Deposit bail-in risks are slowly being realised in Ireland, after it emerged overnight that FBD, one of Ireland's largest insurance companies, have been moving cash out of Irish bank deposits and into bonds.
Revelations regarding deposit bail-in risks came in the wake of warnings of a new property crash centred on the housing market in Ireland. The former deputy governor of the Central Bank warned in an op-ed in a leading international financial publication, Project Syndicate, that Ireland is at risk of another housing market crash.
Insurer FBD has moved over €150 million out of the Irish banking system and into corporate and sovereign bonds over the past year. The move was prompted by low returns offered by bank deposits and the risks that deposit bail-in rules could see deposits confiscated.
FBD chief executive Fiona Muldoon told the Irish Independent that the "extremely low returns offered on term deposits by banks, coupled with fears that new bail-in rules introduced this year by the European Union could expose bank bondholders and depositors to bailing out a failed lender, meant it has shifted investments away from banks."
The new deposit bail-in mechanism is designed to protect banks and is touted as a way to prevent taxpayers being liable for bailing out collapsed lenders. It is believed that it leaves bank bondholders and deposit customers with more than €100,000 on deposit at risk of footing the bill.
There is a belief that bail-ins only relate to “the wealthy” and "rich" depositors as they will be imposed on those with deposits greater than national deposit guarantees. These deposit “guarantees” are generally the ‘big round’, arbitrary number of say €100,000, $250,000 and £75,000. These are not particularly large amounts and could amount to the entire life savings of a pensioner, a family or indeed it could be the entire capital of a small to medium size business enterprise.
An example of this is the UK where the deposit guarantee was arbitrarily, suddenly and with little fanfare quietly reduced from £100,000 to £75,000 just last year in July 2015.
Thus, it is important to note that the arbitrary round number in the various government deposit guarantees can be, and probably will be, reduced to a lower number – say the new round number of €50,000, £50,000 and $50,000 -  depending on the severity of the next banking crash.
In the event of bail-ins, governments and banks are likely to seek to impose deeper haircuts on creditors including depositors in order to bail-out and protect the failing banking system.
FBD's deposits with Irish banks were reduced from €451 million to €305 million in recent months. FBD made a €3.1m loss in the first half of the year.
As reported by the Irish Independent:
"As they mature, and as the bank bail-in rules come into play, it's no longer the case that for corporate investors depositing at a bank is risk free," she added.
"To be honest, the return is abysmal now. We've gone back to a more typical investment portfolio for an insurance company."
"You have to be paid for the risk you take," she added. "You might entertain the bail-in risk if you were being properly paid. But if you've a bank trying to charge you for leaving your money with them, you're not inclined to take any risk at all."
The recent bank stress tests showed that Irish banks are the most vulnerable in the EU in the event of another financial crisis.
Meanwhile, the risk of another property crash centred on the housing market has been warned of by a respected economist. Stefan Gerlach, who left the Central Bank of Ireland earlier this year to become Chief Economist at BSI Bank in Zurich, asked:
"Having endured the collapse of its housing market less than a decade ago, Ireland has lately been experiencing a blistering recovery in prices, which already have risen in Dublin by some 50% from the trough in 2010, is Ireland setting itself up for another devastating crash?”
Among the concerns he expresses in an article titled 'The Return of Ireland’s Housing Bubble' for the global finance think-tank Project Syndicate is that the Central Bank here is coming under undue pressure from the construction industry and politicians to relax the loan to value and loan to income ratios on mortgage lending it introduced last year.
He warns that while housing bubbles are easy to spot, there are a number of conflicts of interest that make it hard to take action as the market gets out of control as reported by Newstalk:
"The obvious question is why nobody stepped in before it was too late. The answer is simple: while the bubbles are inflating, many people benefit. With the construction sector thriving, unemployment falling, and banks lending freely, people are happy – and politicians like it that way."
"Many in Ireland might find that conclusion overly pessimistic. Maybe they are simply hoping that, this time, the luck of the Irish will hold. Perhaps it will, and this time really is different. But there isn’t much evidence of that," he concludes.
The 'Bail-in regime' is one of the greatest financial risks to investors, savers and indeed companies internationally today. Yet it remains the most poorly covered financial risk and is largely ignored by financial advisers, brokers and not surprisingly governments and banks.
The growing financial risk in all western countries has not been properly analysed. In a world already beset with huge deflationary pressures and still insolvent banks, the bail-in regime and confiscating deposits, especially from job creating companies, would be extremely deflationary and would likely contribute to severe recessions.
This is something we warned of when we first conducted our extensive research on the developing global bail-in regimes after the Cyprus bail-ins in 2013. Diversification of deposits remains vital and one important way to protect against a bail-in is owning physical gold. Taking delivery of gold coins and bars and owning bullion in allocated and segregated storage in the safest vaults in the world is a prudent way to protect against the deposit bail-in regime.
Gold and Silver Bullion - News and Commentary
Gold Prices (LBMA AM)
15Aug: USD 1,339.20, GBP 1,037.21 & EUR 1,198.85 per ounce
12Aug: USD 1,336.70, GBP 1,032.60 & EUR 1,199.02 per ounce
11Aug: USD 1,344.55, GBP 1,037.05 & EUR 1,206.06 per ounce
10Aug: USD 1,351.85, GBP 1,035.11 & EUR 1,209.23 per ounce
09Aug: USD 1,332.90, GBP 1,025.80 & EUR 1,201.74 per ounce
08Aug: USD 1,330.00, GBP 1,019.84 & EUR 1,198.86 per ounce
05Aug: USD 1,362.60, GBP 1,036.39 & EUR 1,222.53 per ounce
Silver Prices (LBMA)
15Aug: USD 19.90, GBP 15.40 & EUR 17.81 per ounce
12Aug: USD 19.87, GBP 15.33 & EUR 17.81 per ounce
11Aug: USD 20.21, GBP 15.56 & EUR 18.13 per ounce
10Aug: USD 20.34, GBP 15.55 & EUR 18.19 per ounce
09Aug: USD 19.70, GBP 15.18 & EUR 17.77 per ounce
08Aug: USD 19.66, GBP 15.04 & EUR 17.74 per ounce
05Aug: USD 20.22, GBP 15.36 & EUR 18.14 per ounce

Recent Market Updates
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- Why Italy’s bank crisis could be a ‘ticking time bomb’

http://www.zerohedge.com/news/2016-08-15/deposit-bail-warning-ireland-bail-risk-uk-very-high