TARPLEY’S ASSESSMENT Spells trouble for Bank Control-
Euro Momentarily Stabilized — German Ban on Naked Credit Default Swaps Is Working
Merkel putting her foot down bringing the Banks to heel-
Webster G. Tarpley
TARPLEY.net
May 21, 2010
Tuesday’s German ban on naked credit default swaps – a measure repeatedly demanded by this web site over recent months — has been in effect now for about three days, and it is working. The panic slide of the euro has been stopped for now, and the forces of depression and destruction have been re-directed against US stocks, commodities, and certain emerging markets. The goal of euro stability has been momentarily achieved. Sarkozy, who talked a good game of limiting speculation, has been exposed as a Euro-wimp, too weak to buck the Anglo-Saxons and go along with Berlin. The Germans had to act alone because of the obvious sabotage of the eurogarchs of the Brussels Commission, which is now promising to come up with their proposal by October (!). Given the ferocity of the hedge fund assault, many Europeans by October will have lost their shirts, and will be living under bridges dressed in barrels, if more measures are not taken this month.
The German ban on certain derivatives marks an historical watershed, the first time in decades that a major economic power has acted in overt violation of the implied rules of financial globalization, rules which pertain to the hot-money casino system which has dominated the world since the early 1990s.
German Finance Minister Schäuble appears determined to press on in the fight against the speculators with or without the Euro-wimps and the US-UK pro-derivatives bloc. On the eve of the EU finance ministers’ meeting held today, Schäuble told reporters that markets were genuinely out of control, and that the German government intended to regulate over-the-counter derivatives. He intends to take this effort to the G-20 meeting in Canada.
“I’m convinced the markets are really out of control,” Schäuble said. “That is why we need really effective regulation, in the sense of creating a properly functioning market mechanism.” Risks and rewards were currently “completely unbalanced,” he added. “We need transparency for all market participants.”
Therefore, Schäuble said, over-the counter transactions need to be regulated. Furthermore, attention must be paid to the ratio of financial transactions to the real exchange of goods and services. “They bear no relationship to each other,” the minister said. “But, forgive my saying so, minimum profits of 25 per cent are simply unimaginable in the real economy. It isn’t healthy.” Schäuble was adamant that Continue reading Euro Momentarily Stabilized — German Ban on Naked Credit Default Swaps Is Working.
Comments are closed.