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Oct 11, 2015

'Gold bugs' aren't the great concealers; central banks and financial journalists are: GATA | THE GATA DISPATCH on October 11, 2015.

'Gold bugs' aren't the great concealers; central banks and financial journalists are

Submitted by cpowell on Sunday, October 11, 2015.  October 11, 2015

MarketWatch columnist Brett Arends may win this year's award for the most disinformation in financial commentary about gold. His October 9 column, "Here's the Chart Gold Bugs Don't Want You to See" --
-- is misleading from top to bottom.

In the first place, while the gold business has its share of dishonorable people, the gold business is small and its dishonorable people are outnumbered a thousand to one by dishonorable people in government, central banking, and the stock, bond, and real estate businesses. And whatever a few "gold bugs" are hiding from the markets, it is trivial compared to what investment banks and central banks are hiding, about which Arends has yet to show any curiosity.

The World Economic Order is Collapsing And This Time There Seems No Way Out | Will Hutton: The Guardian | Global Economy - October 11, 2015.

The world economic order is collapsing and this time there seems no way out | Will Hutton

Will Hutton
Europe has seen nothing like this for 70 years – the visible expression of a world where order is collapsing. The millions of refugees fleeing from ceaseless Middle Eastern war and barbarism are voting with their feet, despairing of their futures. The catalyst for their despair – the shredding of state structures and grip of Islamic fundamentalism on young Muslim minds – shows no sign of disappearing.
Yet there is a parallel collapse in the economic order that is less conspicuous: the hundreds of billions of dollars fleeing emerging economies, from Brazil to China, don’t come with images of women and children on capsizing boats. Nor do banks that have lent trillions that will never be repaid post gruesome videos. However, this collapse threatens our liberal universe as much as certain responses to the refugees. Capital flight and bank fragility are profound dysfunctions in the way the global economy is now organised that will surface as real-world economic dislocation.

Fed Officials Seem Ready to Deploy Negative Rates In Next Crisis: GATA | THE GATA DISPATCH on October 11, 2015.

Fed officials seem ready to deploy negative rates in next crisis

Submitted by cpowell on Sunday, October 11, 2015By Greg Robb, New York
Saturday, October 10, 2015

Federal Reserve officials now seem open to deploying negative interest rates to combat the next serious recession even though they rejected that option during the darkest days of the financial crisis in 2009 and 2010.
"Some of the experiences [in Europe] suggest maybe can we use negative interest rates and the costs aren't as great as you anticipate," said William Dudley, the president of the New York Fed, in an interview on CNBC on Friday.
The Fed under former chairman Ben Bernanke considered using negative rates during the financial crisis, but rejected the idea.
We decided -- even during the period where the economy was doing the poorest and we were pretty far from our objectives -- not to move to negative interest rates because of some concern that the costs might outweigh the benefits," said Dudley. ...
... For the remainder of the report:
... For the CNBC interview:

IMF and World Bank Disagree About Competitive Devaluations: GATA | THE GATA DISPATCH on October 11, 2015

IMF and World Bank disagree about competitive devaluations

Submitted by cpowell on Sunday, October 11, 2015. The Real Fight to Win the International Currency Wars
By Mehreen Khan
The Telegraph, London
Saturday, October 10, 2015

China's decision to tweak its exchange rate peg with the dollar in August provoked reactionary howls of derision -- from the United States to India -- that Beijing was gearing up for a new wave of international currency warfare.
But do currency wars really work?
Ahead of its bi-annual World Economic Outlook in Peru this week, the International Monetary Fund has waded into the debate. It published a comprehensive set of findings confirming that weaker currencies are still an effective tool for economies to grow their way out of trouble.
An exchange rate depreciation of around 1 0percent, said the IMF, results on average in a rise in exports that will add 1.5 percent to an economy's output.
But both the research and the timing are not uncontroversial. ...
... For the remainder of the report:

U.S. Economy and Monetary Policy: Vice Chairman Stanley Fischer At the Group of Thirty International Banking Seminar, Lima, Peru: FRB | Notifications - October 11, 2015

Speech by Vice Chairman Stanley Fischer on U.S. economy and monetary policy

Vice Chairman Stanley Fischer

At the Group of Thirty International Banking Seminar, Lima, Peru

October 11, 2015

U.S. Economy and Monetary Policy

The U.S. economy continues to grow at a moderate pace, a pace sufficient to generate ongoing improvements in the labor market. On average, payrolls have expanded about 200,000 per month so far this year, and the unemployment rate has declined to 5.1 percent, just a bit above Federal Open Market Committee (FOMC) participants' median estimate of the normal long-run level of unemployment. But there remain additional forms of slack in the labor market that are not fully captured by the standard unemployment rate. The labor force participation rate remains below most estimates of its underlying trend, and an unusually large number of people are working part time but would prefer to work full time. Moreover, nominal wage growth has remained subdued. Real wage growth has also been subdued, possibly reflecting the low rates of productivity growth in the United States economy during recent years.