You had better memorize the term: de-dol-la-ri-za-tion

Some say it was Colonel Muammar Qaddafi, who wanted to dethrone the dollar, and so he paid for it with his own life. Others say it was Iraq’s President Saddam Hussein, who wanted to make settlements in a currency other than the US dollar, and he was hanged. Now it is Russia and China, which want to do the same. Just days ago an agreement was signed to this effect.

(i) Russia and China have decided to begin to make mutual settlements increasingly in their respective national currencies, and

(ii) they have decided to bypass the SWIFT system, introducing their own instead.

Moscow has also revealed lately that Russia has stopped using the US dollar and the SWIFT system for settlements in arms trade.

The exchange of goods between Russia and China is significant; Russian weaponry has a lot of clients around the globe. On the other hand both countries, and especially China, have large dollar reserves. And both states are under attack from the West, be it economic sanctions against Moscow, be it American trade war against Beijing.

To administer punishment for such a daring act was a child’s play in the case of Libya and Iraq: the two countries were swiftly dealt with. What can one do with a nuclear superpower on the other hand and Asia’s largest economic tiger on the other?
Continue reading

Enslavement of people through debt is a perfect enslavement

If the American economy is doing so well, why did FED suddenly become so mild in its rhetoric during the last session? At the previous meeting in March, none of the FOMC Committee members was willing to lower interest rates, now there are 7 members who want to pump cheap money into the market. Perhaps it was the reaction to Draghi’s speech in Vilnius, in which the ECB chief announced further bond purchases and stated that he “will use all possible means” to boost the European economy before his term ends in autumn.

It looks like currency wars will continue and the central banks will continue to compete with each other in easing their policies. The markets are happy about this, and stock prices in the USA are setting new records. For European citizens, Draghis’ announcement is rather a threat to their savings. If the ECB introduces the negative interest rate, the sums on their accounts will slowly but surely melt. We have warned about this several times.Data from the retail trade and from orders in industry show that American citizens are not doing so well either. Even in April, i.e. before the new steps Trumps in the trade war, they performed very weakly. Why is that? Unemployment is at its lowest level for 50 years, inflation is low and American companies paid record dividends in the first quarter. Nevertheless, consumers are not willing to spend much. It is because, despite full employment, wages are not raised. Another factor is the huge indebtedness of Americans. An example: only the debts made with credit cards amount to 1 trillion dollars! The point is: the interest rate on loans in the USA remains low, but the interest rate on credit cards is growing and currently averages 17% annually. This means that Americans have to pay 170 billion dollars in interest every year!
Continue reading

Mini-Bots – Thorn in the Eye of Brussels, Rescue for Rome

The renunciation of one’s own sovereignty costs a lot. If a country decides to join the Eurozone, it must accept that it will not be able to devalue its currency in the event of an economic crisis. The Italian Lega is now trying to fulfil its election promises, even though the state coffers are empty. The solution? A parallel currency.

The idea is nothing new. What Claudio Borghi, the economic expert of the Lega Nord, came up with was tried out by Argentine society at the turn of the century: in 2001 the government in Buenos Aires launched “cuasimonedas” to plug its debt hole. Each province issued treasury bonds to meet payment obligations. The most popular became the Patacones of Buenos Aires province, which were given mainly to those employed in the state sector and social recipients, but with which one could pay everywhere.

The introduction of Argentina’s parallel currency initially led to chaos in the country: the rich transferred their dollars abroad (a total of more than 100 billion), the poor and the middle class had no choice and immediately spent the Patacones they received in fear of them becoming worthless overnight. However, this spurred consumption and helped the economy to get back on its feet. The good 2002 and 2003 harvests and the rising commodity prices on the world markets also helped to ease the financial situation of this eighth-largest country in the world. Argentina survived the crisis because it was able to devalue its money and because it has the most fertile soil in the world.
Continue reading

The New Tanker War – Trump Pampers the US Shale Oil Industry

The situation in the Gulf of Oman is getting worse. After the attacks on two tankers, Khamenei said that he would never sit at the negotiating table with the US again.So Iran will continue its nuclear program till the Israeli strategists interpret its advancement as unacceptable and will have Iranian targets attacked. Up to this time a new tanker war is more likely than 30 years ago, of which Gefira warned already in autumn 2018. Our forecasts proved correct.

The attacks could indeed have been carried out by Iranians, and it is quite possible that they were a provocation of the Americans. Such a hypothesis is justified by the analysis of the history of the conflict between the Great Satan and Iran. In August 1953, MI6 and CIA overthrew democratically elected Prime Minister Mohammed Mossadeq for wanting to nationalize the British Anglo-Iranian Oil Company (now BP). The company earned huge sums, of which Iran received hardly anything. The CIA’s Shah Reza Pahlavi, installed in place of Mossadeq, guaranteed the US that Iran would not cross over to the Soviet Union. With the help of the Americanshe founded the secret service SAVAK, which suppressed the population, tortured and committed numerous murders.The Americans were not bothered by this for decades, but today they are outraged by the violation of human rights in Iran: indeed by the violation of their interests in the region.
Continue reading

UKRAINE: Are we in for a white revolution, assassination or coup d’etat?

“I request you to release of duty the head of security, the attorney general and the minister of the defence,” said Ukraine’s President Volodymyr Zelensky in his inaugural speech which he delivered on 20th of May. Were the head of security, the attorney general and the minister of the defence listening? Obviously they were and this might spring them into action. Is it only their posts that the new president is after? Or their heads as well?

While addressing both houses of parliament, Volodymyr Zelensky appealed to the deputies to have new laws passed abolishing the immunity of the members of the legislative and imposing severe punishments for those who have enriched themselves illegally. Ultimately, much to the disbelief of the present, the new head of state said he was dissolving parliament with immediate effect, which means that also the deputies have just lost their well-paying jobs.

Will a coalition form between them and the three ministers who already know they are not tolerated by Volodymyr Zelensky? Is what the new president said a show of political zeal for his so numerous voters (73% of the ballot)? Is he backed by such strong powers that he does not need to reckon with the consequences?

Pundits have been and are still pointing to the political inexperience of the new president. Inexperienced he might well be, but even so would he be acting so foolishly right at the start of his tenure, turning his potential allies and important figures into his bitter enemies? Or were they his bitter enemies anyway and Volodymyr Zelensky merely forestalled their insidious action that is brewing anyway?
Continue reading

A criminal phenomenon

AN INTERVIEW WITH FRANCESCA TOTOLO

“Never before has a criminal phenomenon enjoyed widespread international support by governments, political parties, religious and civilian organizations, popular opinion, and never before has a sovereign state renounced to exercise control over its borders.”

These opening words by Gianandrea Gaiani are a fitting introduction to Francesca Totolo’s latest book Inferno Spa. Gaiani is no stranger to the business of illegal immigration, being an author of several books on the subject. He was interviewed by Gefira in 2017 when the Italian government was then still a center-left pro-migrants coalition. Totolo has agreed to an exclusive interview for Gefira and we recently met her in Florence, where she was presenting her new book.

Francesca Totolo is a freelance investigative journalist and collaborates with a variety of Italian and international press agencies and websites. Her investigations have been published both in Italy and abroad. We could easily call Totolo a diligent – and outspoken – journalist as her new book, which she wrote with Dante’s Inferno in mind, involves just that: solid, painstaking, diligent research and fact-checking. The result is the equivalent of an encyclopedia of who’s who in the business (Spa is the Italian acronym for joint-stock company, equivalent of the German AG) of the immigrants’ industry, an industry which moves an unending flow of human beings and money.
Continue reading

Problems with the labor market and the shrinking middle class in the USA

Most economists are delighted with the situation on the labour market of the world’s largest economy and hardly want to hear about the vision of a recession. They believe that the unemployment rate below 4% (which has been around for over a year) and a sustained increase in new jobs are evidence of the strength of the economy.

They also rejoice because such low unemployment was achieved with moderate household indebtedness. Economists believe that the process if maintained should continue to encourage the optimism of most consumers and encourage them to consume. Until consumers fall into the euphoria of spending (which has always been a harbinger of a crisis or recession), there are still a few quarters of consumption growth ahead of us. The increase will not result from rising salaries, as at such levels salary increases are only possible at a moderate pace, but from the rising household debt, which would be willing to take out loans in such an economic environment.
Continue reading