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Project Censored's top 2009-10 story is the plan to replace the dollar, perhaps by debasing it to worthlessness. However, other nations have reacted, Michael Hudson saying by "creat(ing) an international monetary system in which central bank savings do not fund (America's massive debt). Russia, China, India and Brazil have taken the lead."
Others will likely follow. "Finance has become the new mode of warfare." Currency wars are in play for economic competitiveness, nations jockeying with each other during a period of economic weakness, a game putting them all at risk.
QE "is based on the wrong-headed idea that if the Fed provides liquidity, banks will....lend out credit at a markup, 'earning their way out of debt' - inflating the economy in the process."
Not the economy most people think of, however. The Fed's targeting "asset markets - above all real estate, as 80% of (US) bank loans" are for mortgages.
Importantly, Fed gamesmanship puts international finance at risk. "This is what US economic policy and even its foreign policy is now all about, including de-criminalizing financial fraud." In the 1980s, greed was called good, plenty of fraud, of course, with it. Today though, it's massive theft in amounts never before imagined in unknown multi-trillions, lots more to come unless stopped.
Instead of healing ailing economies, they're being wrecked. Hoped for new borrowing isn't happening. Instead, "banks have been tightening their loan standards rather than lending more to US homeowners, consumers and businesses since 2007."
Rather than lend domestically, dollars are flooding world currency markets, hoping insolvent banks can earn their way out of debt, and make America more competitive by debasing the dollar, perhaps replacing it.
Domestically, the market is "loaned up." Borrowing is shrinking, not expanding, a sure way to prevent economic growth. QE I failed, the $1.7 trillion created from March 2009 to March 2010. More worrisome is that QE II entails:
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