Some concepts of inflation, currency and finance ... (3 / 3)
Keywords: money, cost, Friedman, Keynes, chicago boys, monetary, Central Bank, ECB interest rates
Again, a straw-shaped beam! Look at the beautiful curves that to us (from a document BNP Paribas Resarch): that of the deviation from the objective of 4,5%, and that of the cumulative deviation from 98 (the deviation from the goal is called money gap). These curves are at the bottom of this article.
But you tell me, because since you have read Friedman and adopted his beautiful theory, if at all times and in all places, inflation is caused by too much money, then one of two things: either we had a growth stronger than 2% predicted, or we had a terrible inflation slayer pensioners beyond 2% target ...
Lost and re-lost. On average about 2% growth, and "inflation" below 2%. So the question is 1000 billion, but where did the money go?
I'll help you: remember ... the way governments and central banks calculate inflation excludes strangely ... the price of real estate assets and the financial assets. Bizarre? You say strange?
As we listen to some financial circles, or read the works of some experts, it seems that the answer is clear. Yes, it's true, the planet (because it's not just Europe, it was the same story in the US and around the world) would crumble under the excess liquidity that is ... ie money! Developed not knowing what to do! Globally, the monetary base (that is to say the money issued by central banks) increasing at a rate of ... 20% per year! Clearly, and this will probably do a back flip with surprise at all accustomed JT 20 hours of having well integrated "It is wrong, it is nearly bankrupt, there's enough money, the lives in France its means. " Money, they are people, and even they are people too, so much that he does not even know where to invest, the poor (although the playground is now global, with free movement of capital).
Amazing, no? So that some specialists from the Seraglio (bankers, as Jean Peyrelevade, former president (and rectifier) Crédit Lyonnais, and Patrick Artus, Chief Economist of CDC Ixis) begin themselves to move in and take the Sonette alarm. Artus even speak of "capitalism without project" because the profits of large groups accumulate and invest more ... except to redeem for considerable sums their own actions (to artificially maintain the profitability of the dividend the shareholder). Large groups do not know what to do with their accumulated money mountains! And as the Artus says in his recent book "Capitalism is now self-destruct," this is largely due to central banks, whose complicity, to borrow the term used by the author, is obvious for fostering easy creation of money behind stock and housing bubbles.
Because do not believe that the ECB will go it alone in this strange paradox. Since 10 years, his American counterpart, the Fed has just helped to double the amount of dollars circulating in the world (an average increase of ... 8% annually coincidentally). As the mechanism is not ready to stop, the Fed found a radical way for us to stop coming titillate on this somewhat paradoxical: NEW! from March 23 2006, it no longer publishes the figures of money supply M3! surprising decision announced laconically and without real justification ... except the fact of not making show task: the incredible increase in the amount of money created in recent years.
For information, a little embarrassed the armholes without doubt, the ECB had announced it in 2003 M3 the control objective would not be regarded as a pillar of European monetary policy! The only outstanding mastery of the rattle for the crowds and the famous so-called "inflation" (redacted in fact what makes the task yet: the price of financial and real assets as explained above). Do not be surprised if one of these days, M3 disappears tables of the ECB ...
So here is very strange all the same and brings us back to the beginning of the story and Friedman. To prevent the State rotates printing money, some have managed from the end of 60 years, but particularly over the following decades, to remove the famous board of the hands of the people's representatives to put in safer hands ... for them. And now than done, printing money starts to turn more beautiful! Contradiction? Yes, at a minimum, but I would say more: Scam!
Who benefits because that money all charges ink (even virtual) is not yet dry? To those who take advantage of speculative bubbles thus generated: real estate and financial assets. And do not tell me that the first-time buyer or an employee who has three unfortunate actions of his company is one of the winners. This is only a screen intended to justify the extent of the hold-up! Because of course, the new money created ex nihilo remember the (from nothing so) through loans granted to some, enters the economy through certain specific doors. This is of course the role of lenders (banks) to sort, like a vigil (a "physiognomist") at the entrance to a nightclub. And I'm not sure that the unemployed, the Rmiste or a population group have the "proper dress code" to return. However, all financial engineering, a complexity that we can hardly imagine, developed in recent years in favor of a minority of investors, is based on a cheap credit to speculate on financial markets world in a way that the typical person to be hard to imagine. This population there, suit and tie, is of course welcome at the banquet of easy credit.
It should be seen there obviously the latest avatar as of the historic concentration of wealth whose magnitude only increase. apparent miracle of modern finance: the more you borrow money, the more you get rich! I struggle to explain this to my old mother ... Other times, other customs are told. And other monetary system, especially. (...)
- The currency scam of creating money
- Slip curve M3 the EU zone to the objective of 4,5%:
- Curve of the Cumulative gap M3 over the goal:
- The author of these pages site
- Listen and download radio broadcasts "From Under and Men" in .mp3
- What the consumer price index?
- The European Central Bank website