AIIB: Has The U.S. Lost Its Role As Driver Of Global Economy?
Former U.S. Treasury Secretary Lawrence Summers wrote on April 5 that this month may be remembered as the moment the United States lost its role as the underwriter of the global economic system. His comments refer to the circumstances surrounding China’s launch of a new venture, the Asian Infrastructure Investment Bank (AIIB). Wary of China’s growing ambitions and influence, the United States had advised its allies not to join the institution, but many signed up anyway. The debacle was undoubtedly embarrassing for Washington, but even so, Summers’ prophecy is a bit premature at this stage. ... more
http://www.valuewalk.com/2015/04/aiib-america/
Topic: China "Can't Believe Its Luck" On Investment Bank - page 3. (Read 3620 times)
I'm still waiting because we don't know yet what China will do with that new investment bank. Will anything change? China has already made huge investments in Africa, paying for roads and ports to ship raw materials to its factories. Will it do anything more than that? So far, this new bank certainly looks like a nuclear bomb, but that doesn't mean China wants to use it to destroy the USA.
Well,it just got started virtually the other day so you´ll have to wait a while to see the results - I guess.
Good luck, g
I'm still waiting because we don't know yet what China will do with that new investment bank. Will anything change? China has already made huge investments in Africa, paying for roads and ports to ship raw materials to its factories. Will it do anything more than that? So far, this new bank certainly looks like a nuclear bomb, but that doesn't mean China wants to use it to destroy the USA.
China’s AIIB: The Final Tally
Interesting facts about the members of China’s AIIB — with even more interesting implications.
The deadline for prospective founding members to submit their applications to China’s new Asian Infrastructure Investment Bank (AIIB) came on March 31, leading a flurry of final applications from countries all over the world. When the dust settled, China moved on to selecting who would actually made the cut. Yesterday, the AIIB released its final, approved list of founding members (excluding Taiwan). With 57 countries signed up, the AIIB includes well over a quarter of the world’s nations. Even more interestingly, 16 of the world’s 20 largest economies are on board (with the U.S., Japan, Mexico, and Canada as the holdouts). .......
http://thediplomat.com/2015/04/chinas-aiib-the-final-tally/
Interesting facts about the members of China’s AIIB — with even more interesting implications.
The deadline for prospective founding members to submit their applications to China’s new Asian Infrastructure Investment Bank (AIIB) came on March 31, leading a flurry of final applications from countries all over the world. When the dust settled, China moved on to selecting who would actually made the cut. Yesterday, the AIIB released its final, approved list of founding members (excluding Taiwan). With 57 countries signed up, the AIIB includes well over a quarter of the world’s nations. Even more interestingly, 16 of the world’s 20 largest economies are on board (with the U.S., Japan, Mexico, and Canada as the holdouts). .......
http://thediplomat.com/2015/04/chinas-aiib-the-final-tally/
sometimes good luck follows by bad luck,, by keeping more hope on this bank,, is lot pressure as well as lot countries wants low cheap loans n dont even pay bank n bankrupt,, particularly these european nations having strong history of attacking n looting other countries,, by giving loans to those countries only brings bad luck
Well, the Chinese are quite brilliant of course. First they help Uncle Sam spend itself to bankruptcy in endless war adventures and regime changes leaving a string of ruined basket cases here and there. Then they come in flushed with currency, not weapons and war, and finance the rebuilding of the whole thing. And more. And their Russian partners will join in. The American shell corporation will be on the sidelines licking its wounds for the next decades. That small appendage in westernmost Eurasia called Western Europe will join the Eurasian Trade Zone in due course. This will be
The New World Order.
Good luck, g
sometimes good luck follows by bad luck,, by keeping more hope on this bank,, is lot pressure as well as lot countries wants low cheap loans n dont even pay bank n bankrupt,, particularly these european nations having strong history of attacking n looting other countries,, by giving loans to those countries only brings bad luck
When you think the financial world can’t get any crazier… this happens
April 9, 2015
Medellín, Colombia
The world has truly gone mad.
We’ve become accustomed somewhat in the last several years to historical anomalies such as zero percent interest rates, Quantitative Easing, competitive currency devaluation, etc. by governments and central banks the world over.
It’s almost become the new norm.
But then there’s always something that happens that shocks us all over again.
And just like with any other addiction, the infusion of ridiculous and unsustainable policies has to be that much more potent to have any effect.
Two such developments have just taken place in the financial world.
First, Switzerland became the first to issue 10-year government bonds with a negative yield.
Let that sink in for a moment.
Especially in the last year we’ve seen governments issue short-term debt with negative interest rates. But now the Swiss government is the first that will actually profit from its long-term 10-year debt.
It’s insane.
Just like in a bad infomercial—“But wait, there’s more!”
The government of Mexico just sold 100-year bonds denominated in EUROS. Also the first ever of its kind.
A few years ago, Mexico sold its first 100-year bond—that one was denominated in US dollars. Later, they sold another century-bond in British pounds.
You can just imagine the figures at the Mexican central bank’s meeting going: “Well, that went great. I wouldn’t have believed we could ever get away with that… Hey, what if we tried to do it in euros next time, haha?”
So they did. They took advantage of the European Central Bank’s unprecedented stimulus and issued a 100-year bond in a currency that most likely won’t even be around in the next decade.
Who’s dumb enough to buy this stuff—10-year debt at negative yields and 100-year debt in a doomed currency?
Institutional investors, of course—large pension funds and the like. You might look at news like that and think, well, that’s crazy, I’d never do that. But the fact is, it’s being done with YOUR MONEY.
Just like Winston Churchill commented that it’s false to characterize the fighting at places like the Somme, Verdun etc. in WWI as battles, when they were actually more like prolonged sieges, what’s happening in the financial world today is similar. .... more
https://sep.yimg.com/ty/cdn/realityzone/UFNswiss10yearNegativeInterestBond.html
April 9, 2015
Medellín, Colombia
The world has truly gone mad.
We’ve become accustomed somewhat in the last several years to historical anomalies such as zero percent interest rates, Quantitative Easing, competitive currency devaluation, etc. by governments and central banks the world over.
It’s almost become the new norm.
But then there’s always something that happens that shocks us all over again.
And just like with any other addiction, the infusion of ridiculous and unsustainable policies has to be that much more potent to have any effect.
Two such developments have just taken place in the financial world.
First, Switzerland became the first to issue 10-year government bonds with a negative yield.
Let that sink in for a moment.
Especially in the last year we’ve seen governments issue short-term debt with negative interest rates. But now the Swiss government is the first that will actually profit from its long-term 10-year debt.
It’s insane.
Just like in a bad infomercial—“But wait, there’s more!”
The government of Mexico just sold 100-year bonds denominated in EUROS. Also the first ever of its kind.
A few years ago, Mexico sold its first 100-year bond—that one was denominated in US dollars. Later, they sold another century-bond in British pounds.
You can just imagine the figures at the Mexican central bank’s meeting going: “Well, that went great. I wouldn’t have believed we could ever get away with that… Hey, what if we tried to do it in euros next time, haha?”
So they did. They took advantage of the European Central Bank’s unprecedented stimulus and issued a 100-year bond in a currency that most likely won’t even be around in the next decade.
Who’s dumb enough to buy this stuff—10-year debt at negative yields and 100-year debt in a doomed currency?
Institutional investors, of course—large pension funds and the like. You might look at news like that and think, well, that’s crazy, I’d never do that. But the fact is, it’s being done with YOUR MONEY.
Just like Winston Churchill commented that it’s false to characterize the fighting at places like the Somme, Verdun etc. in WWI as battles, when they were actually more like prolonged sieges, what’s happening in the financial world today is similar. .... more
https://sep.yimg.com/ty/cdn/realityzone/UFNswiss10yearNegativeInterestBond.html
U.S. gets little support in its opposition to AIIB
April 9, 2015
When China rolled out the Asian Infrastructure Investment Bank last October, the stiff resistance from the U.S. (as well as Japan) took the world by surprise. This opposition notwithstanding, AIIB, has so far picked up 27 regional members and seven non-regional members, including the U.K., Germany, France and Italy. In addition, there was a virtual avalanche of applications before the March deadline for founding membership, which included another 23 countries that are currently under consideration. This overwhelming positive response to the AIIB from countries across the globe was perhaps more than China initially anticipated.
Why did the U.S. opposition not convince even its traditional allies to steer clear? Part of the reason was a serious misreading of global sentiments on this matter.
To Asian developing countries, the U.S. opposition reflected a retrograde cold-war mindset that wasn't attuned to their economic wishes and aspirations. To sustain its current growth trajectory, developing Asia needs to invest about $800 million annually in infrastructure, according to an Asian Development Bank (ADB) study. And the existing international development finance institutions, such as the World Bank and ADB, cannot muster sufficient resources to meet this demand. ... more
http://www.baltimoresun.com/news/opinion/bs-ed-aiib-opposition-20150409-story.html
April 9, 2015
When China rolled out the Asian Infrastructure Investment Bank last October, the stiff resistance from the U.S. (as well as Japan) took the world by surprise. This opposition notwithstanding, AIIB, has so far picked up 27 regional members and seven non-regional members, including the U.K., Germany, France and Italy. In addition, there was a virtual avalanche of applications before the March deadline for founding membership, which included another 23 countries that are currently under consideration. This overwhelming positive response to the AIIB from countries across the globe was perhaps more than China initially anticipated.
Why did the U.S. opposition not convince even its traditional allies to steer clear? Part of the reason was a serious misreading of global sentiments on this matter.
To Asian developing countries, the U.S. opposition reflected a retrograde cold-war mindset that wasn't attuned to their economic wishes and aspirations. To sustain its current growth trajectory, developing Asia needs to invest about $800 million annually in infrastructure, according to an Asian Development Bank (ADB) study. And the existing international development finance institutions, such as the World Bank and ADB, cannot muster sufficient resources to meet this demand. ... more
http://www.baltimoresun.com/news/opinion/bs-ed-aiib-opposition-20150409-story.html
The US Dollar Rally Will Crush Stocks…Just As It Did in 2008
The world carry trade for US Dollars is over $9 trillion.
In today’s world of monetary insanity, investors seem to forget that $1 trillion is a staggering amount of money. So to put that $9 trillion carry trade into perspective, if it were a country instead of a carry trade, it would be roughly equal in size to the economy of China, the second largest economy in the world.
Suffice to say, we’re talking about a truly staggering amount of borrowed US Dollars that have been invested into other assets/ investments.
Carry trades only work if the currency you are borrowing in doesn’t rally. As soon as it does, your trade very quickly goes into the red.
This is particularly true if you’re talking about a corporation that has borrowed in US Dollars to fund projects in countries where sales are denominated in other currencies (Europe, Asia, etc.)
The reason for this is that many multi-nationals do not hedge their currency risk. So if, for instance, they are borrowing in US Dollars without a hedge to invest in Europe and the US Dollar rallies, their projects very quickly begin to lose their appeal… and a LOT of money.
Ka-Boom:
more:
http://www.zerohedge.com/news/2015-04-09/us-dollar-rally-will-crush-stocks%E2%80%A6just-it-did-2008
The world carry trade for US Dollars is over $9 trillion.
In today’s world of monetary insanity, investors seem to forget that $1 trillion is a staggering amount of money. So to put that $9 trillion carry trade into perspective, if it were a country instead of a carry trade, it would be roughly equal in size to the economy of China, the second largest economy in the world.
Suffice to say, we’re talking about a truly staggering amount of borrowed US Dollars that have been invested into other assets/ investments.
Carry trades only work if the currency you are borrowing in doesn’t rally. As soon as it does, your trade very quickly goes into the red.
This is particularly true if you’re talking about a corporation that has borrowed in US Dollars to fund projects in countries where sales are denominated in other currencies (Europe, Asia, etc.)
The reason for this is that many multi-nationals do not hedge their currency risk. So if, for instance, they are borrowing in US Dollars without a hedge to invest in Europe and the US Dollar rallies, their projects very quickly begin to lose their appeal… and a LOT of money.
Ka-Boom:
more:
http://www.zerohedge.com/news/2015-04-09/us-dollar-rally-will-crush-stocks%E2%80%A6just-it-did-2008
AIIB – It Just Happened: “The Moment The United States Lost Its Role . . .”
April 6, 2015
Santiago, Chile
Last week, the government of China closed the enrollment window to join its new Asian Infrastructure Investment Bank (AIIB) as a ‘founding member’.
The AIIB, if you haven’t heard of this yet, is designed to essentially displace the Western-controlled IMF and World Bank.
And prior to last Tuesday’s deadline, dozens of nations around the world from New Zealand to Denmark signed up to join.
Even staunch US allies like the United Kingdom and Israel agreed to be part of AIIB.
This is a huge coup for China, and probably the most obvious sign yet that the global financial system is in for a giant reset.
Under the weight of nearly incalculable debt and liabilities, the United States is in terminal decline as the dominant superpower.
From Ancient Rome to the British Empire, this has happened many other times in history.
This time is not different. And everyone else in the world seems to get it. . . except for the US government.
They act as if the financial universe will revolve around America forever—that they can print money, indebt future generations, and wage war as much as they want without consequence.
But they’re completely blind.
Practically the entire world is lining up against them to form a brand new financial system that is no longer controlled by the US government.
In an editorial published in the Financial Times, former US Treasury Secretary Larry Summers summed it up plainly saying that this “may be remembered as the moment the United States lost its role as the underwriter of the global economic system.”
The consequences of this shift away from a US-controlled financial system cannot be understated.
No more endless spending. No more solving problems with more debt and more money printing.
Suddenly it will be time for painful decisions in the US—like slashing Social Security benefits, drastically scaling back the military, and selectively defaulting on the debt.
Make no mistake, this transition is going to be bumpy.
China may already be the largest economy in the world by many measurements. But the Chinese economy is in for some serious strain over the coming months and years as its massive credit bubble bursts.
So in addition to America’s fiscal and monetary challenges, the world is going to have to suffer through a potential Chinese crisis as well.
But this does not affect the long-term story. Remember, nothing goes up or down in a straight line.
On its road to becoming the global superpower in the 20th century, the United States suffered its own series of deep economic setbacks—from the Panic of 1907 to the Great Depression, and several recessions in between.
China’s path will likely be similar.
This is one of the most important trends of our time. And it’s happening right in front of our eyes.
The world is rapidly throwing off US financial domination. The global financial system is starting to reset. Global financial and political dominance is shifting.
As with any great change, there are going to be people who get completely wiped out—primarily, people who didn’t see the change coming or chose to ignore the trend.
The flip side of this is that, for anyone with the intellectual courage and independence of mind to be paying attention, this is a time of extraordinary opportunity.
Some of the wealthiest people in Europe were minted in just a few years during the Weimar hyperinflation of the 1920s.
And some of the greatest fortunes in the world (some of which still exist today) were made in the early days of the United States as the country rose to dominance.
That’s ultimately the opportunity we have today. We can’t do anything about the trend. It’s happening.
What we can control is how we react to it: ignore it at our own peril, or seize the opportunities that come from it.
http://www.valuewalk.com/2015/04/aiib-dollar/
April 6, 2015
Santiago, Chile
Last week, the government of China closed the enrollment window to join its new Asian Infrastructure Investment Bank (AIIB) as a ‘founding member’.
The AIIB, if you haven’t heard of this yet, is designed to essentially displace the Western-controlled IMF and World Bank.
And prior to last Tuesday’s deadline, dozens of nations around the world from New Zealand to Denmark signed up to join.
Even staunch US allies like the United Kingdom and Israel agreed to be part of AIIB.
This is a huge coup for China, and probably the most obvious sign yet that the global financial system is in for a giant reset.
Under the weight of nearly incalculable debt and liabilities, the United States is in terminal decline as the dominant superpower.
From Ancient Rome to the British Empire, this has happened many other times in history.
This time is not different. And everyone else in the world seems to get it. . . except for the US government.
They act as if the financial universe will revolve around America forever—that they can print money, indebt future generations, and wage war as much as they want without consequence.
But they’re completely blind.
Practically the entire world is lining up against them to form a brand new financial system that is no longer controlled by the US government.
In an editorial published in the Financial Times, former US Treasury Secretary Larry Summers summed it up plainly saying that this “may be remembered as the moment the United States lost its role as the underwriter of the global economic system.”
The consequences of this shift away from a US-controlled financial system cannot be understated.
No more endless spending. No more solving problems with more debt and more money printing.
Suddenly it will be time for painful decisions in the US—like slashing Social Security benefits, drastically scaling back the military, and selectively defaulting on the debt.
Make no mistake, this transition is going to be bumpy.
China may already be the largest economy in the world by many measurements. But the Chinese economy is in for some serious strain over the coming months and years as its massive credit bubble bursts.
So in addition to America’s fiscal and monetary challenges, the world is going to have to suffer through a potential Chinese crisis as well.
But this does not affect the long-term story. Remember, nothing goes up or down in a straight line.
On its road to becoming the global superpower in the 20th century, the United States suffered its own series of deep economic setbacks—from the Panic of 1907 to the Great Depression, and several recessions in between.
China’s path will likely be similar.
This is one of the most important trends of our time. And it’s happening right in front of our eyes.
The world is rapidly throwing off US financial domination. The global financial system is starting to reset. Global financial and political dominance is shifting.
As with any great change, there are going to be people who get completely wiped out—primarily, people who didn’t see the change coming or chose to ignore the trend.
The flip side of this is that, for anyone with the intellectual courage and independence of mind to be paying attention, this is a time of extraordinary opportunity.
Some of the wealthiest people in Europe were minted in just a few years during the Weimar hyperinflation of the 1920s.
And some of the greatest fortunes in the world (some of which still exist today) were made in the early days of the United States as the country rose to dominance.
That’s ultimately the opportunity we have today. We can’t do anything about the trend. It’s happening.
What we can control is how we react to it: ignore it at our own peril, or seize the opportunities that come from it.
http://www.valuewalk.com/2015/04/aiib-dollar/
Published on Mar 24, 2015
Over the past couple weeks, large western countries led by the United Kingdom have rushed to join the China-run Asian Infrastructure Investment Bank. March 31st is the deadline for founding members and at least 35 countries, most of them in Asia, have joined. Germany, France, and Italy have followed Britain in saying that they would also join the bank. The eager European applicants have certainly annoyed the United States. Erin weighs in.
https://www.youtube.com/watch?v=ZLAlDCGaiAc
Over the past couple weeks, large western countries led by the United Kingdom have rushed to join the China-run Asian Infrastructure Investment Bank. March 31st is the deadline for founding members and at least 35 countries, most of them in Asia, have joined. Germany, France, and Italy have followed Britain in saying that they would also join the bank. The eager European applicants have certainly annoyed the United States. Erin weighs in.
https://www.youtube.com/watch?v=ZLAlDCGaiAc
A few weeks back, we noted that China (via a state-run media outlet) appeared to be adopting a more conciliatory approach when it comes to describing Beijing’s vision for the Asian Infrastructure Investment Bank. The venture, which Washington did its best to undermine last year, has made an unlikely run at taking center-geopolitical-stage even as other, more ostensibly newsworthy events (such as the veritable collapse of the Yemeni state and the ongoing crisis in Greece) vie for the market’s very limited attention span.
And while we, more than perhaps any other news outlet, have gone to great lengths to demonstrate the importance of what is not only a move by Beijing to inaugurate a sino-Monroe Doctrine but to simultaneously start the world on the path to yuan hegemony, we were also quick to note that there’s such a thing as being too successful, especially when it comes to making sure a whole cohort of Western nations who have just gone out on the proverbial limb in defiance of The White House, are left with some assurance that there’s at least some part of the institution which is actually aimed at promoting infrastructure development rather than operating solely as Beijing’s newest foreign policy tool. .....
http://www.zerohedge.com/news/2015-04-07/china-cant-believe-its-luck-investment-bank
And while we, more than perhaps any other news outlet, have gone to great lengths to demonstrate the importance of what is not only a move by Beijing to inaugurate a sino-Monroe Doctrine but to simultaneously start the world on the path to yuan hegemony, we were also quick to note that there’s such a thing as being too successful, especially when it comes to making sure a whole cohort of Western nations who have just gone out on the proverbial limb in defiance of The White House, are left with some assurance that there’s at least some part of the institution which is actually aimed at promoting infrastructure development rather than operating solely as Beijing’s newest foreign policy tool. .....
http://www.zerohedge.com/news/2015-04-07/china-cant-believe-its-luck-investment-bank
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