Regulation

Bernie and Ocasio-Cortez Declare War on the Poor With Anti-Credit-Card Law | Mises Institute

Posted on by johnbarleycorn12

Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez unveiled sweeping new legislation on Thursday that would impose a federal cap of 15% on credit-card interest rates. The bill would also allow state governments to set interest-rate ceilings even lower than the federal mandate.
— Read on mises.org/power-market/bernie-and-ocasio-cortez-declare-war-poor-anti-credit-card-law

The politicians seldom have the right answer and the unintended consequences of their actions often hurt those they claim to protect.

The LEI is the Means to an End to in the Hunt for Global Taxation | Armstrong Economics

Posted on by johnbarleycorn12

QUESTION: Hi Marty, I wanted to ask you if you know anything about the LEI (legal entity identifier) that brokers are now requesting from clients who trade forex and other derivatives and who have accounts under a business structure? I recently opened a trading account under a business structure (company/trust) and was only told yesterday I have a month to get an LEI (which I have to pay for myself and renew every year) otherwise I cant trade. I have tried to gather info on it but there is only limited info and it is mainly info from the perspective of the reporting entities (such as brokers) and virtually nothing from the traders perspective. It seems like something that has been imposed by the EU. I was wondering if you have also had to obtain an LEI? Cheers D ANSWER: A Legal Entity Identifier (or LEI) is a 20-character identifier that identifies distinct legal entities that engage in financial transactions. The LEI is a global standard, designed to be non-proprietary data that is freely accessible to all so they can track what entities are doing worldwide. More than 600,000 legal entities have registered from 195 countries. This was created as a consequence of the 2007-2008 Financial Crisis. It is interesting how all governments manage to expropriate more power and control with each financial crisis. It was the CDOs created by Goldman Sachs which blew up the world just as the Black & Schol models in options blew up the financial world back in 1998 with the Long Term Capital Management crisis. But the legal entities that have created these catastrophes are NEVER punished. Not a single entity lost its license and not a single director ever when to jail. The people who blow-up the world are always UNTOUCHABLE and the rest of us lose our rights and freedom in the process. The argument back during the 2007-2009 financial crisis was that there was no way to identify corporations and financial institutions to recognize the counterpart corporation on financial transactions. Therefore, the GOVERNMENTS could not figure it out while the counterparties knew who they were dealing with and accepted their credit position. Accordingly, it was impossible for governments to identify the transaction details and track the money flows of individual corporations and institutions. Governments argued they needed a simple identification method of everyone in the world. In 2011, the G20 (Group of Twenty) called on the Financial Stability Board (FSB) to provide recommendations for a global Legal Entity Identifier (LEI). They wanted a cross-border entity to track everyone in the world. This led to the development of the Global LEI System which began issuing these LEIs to create a unique identification of legal entities acting within the entire world economy. The G20 claims this is necessary so they can know the total risk amount in a crisis. However, the G20 is still incapable of estimating individual corporations’ and the financial institution’s amount of total risk exposure. They are incompetent when it comes to analyzing risks across the entire global marketplace. They cannot even resolve the failing financial institutions in Europe because of local regulation that prevents cross-border solutions within the Eurozone. The G20 blames this lack of knowledge was one of the factors that made it difficult for the early detection of the financial crisis, they will NEVER act to prevent anything in the first place. Adding more regulation simply reduces liquidity and shrinks the world economy. The G20, in response to these inabilities of financial institutions to identify organisations uniquely, claim that was the problem so that their solution was that financial transactions in different national jurisdictions can be fully tracked. Currently, the ROC (Regulatory Oversight Committee), a coalition of financial regulators and central banks across the country, cannot possibly act in advance for they fail to comprehend the dynamics of the world economy. Hence, this is just another means of collecting data to be able to hunt for global taxation.
— Read on www.armstrongeconomics.com/world-news/taxes/the-lei-is-the-means-to-an-end-to-in-the-hunt-for-global-taxation/

Never let a good crisis go to waste. More regulations, fees,and hidden taxes follow every crisis.

US Bank Reserves 10% – EU Bank Reserves 1% | Armstrong Economics

Posted on by johnbarleycorn12

QUESTION: What mechanism prevents banks from creating fraudulent electronic deposits of currency? As an IT systems admin, I have the ability to add / subtract / adjust ERP systems inventory / costing outside the normal users ability. I could add widgets to the system at will, but fraud can’t be sustained very long, as the physical widgets can’t be sold, they only exist in the system. Electronic currency, however, is only a ledger entry, and since new currency units are created as loans – What prevents any bank from just changing the numbers in their systems to create more currency units at will? Can’t get my head around this. Thanks for all you do from a little guy just trying to get by! ANSWER: The creation of money electronically in the banking system is the degree of leverage. Reserve Requirement Ratio at the Federal Reserve was increased on January 18th, 2018. It required that all banks with more than $122.3 million on deposit maintain a reserve of 10% of deposits. Banks with $16 million to $122.3 million must reserve 3% of all deposits. They create money that is purely electronic and we do not see it. I deposit $100 and they lend it to you. Now we both have $100 on deposit and the reserve requirement will be $20 for most banks. They then lend it out a third time and there is now $300 on deposit requiring $30. They cannot create entries out of thin air. They are audited and the reserve ratio is strictly enforced in the USA. The Fed will raise and lower that reserve ratio as they see fit based upon economic conditions. At the European Central Bank, things are substantially different. Eurozone banks are required to hold a specified amount of funds as reserves on AVERAGE in their current accounts at their national central bank in each member state which are called “minimum reserves”. Remember, each member retained its own central bank! A bank’s minimum reserve requirement is set for six-week periods called maintenance periods. This minimum reserves level is therefore calculated on the basis of the bank’s balance sheet prior to the start of each six-week maintenance period. Banks have to make sure that they meet the minimum reserve requirement only on an AVERAGE over the course of the maintenance period. This introduces serious risk. The bank can dip below the minimum reserve in the middle of a crisis and at the end of the six-week period, there can be no reserves remaining. So they do not have to hold the total sum in their current accounts at the central bank on a daily basis! Therefore, this is a flexible arrangement that allows the banks to react to short-term changes in the money markets, but it exposes them to tremendous risk in a financial panic. The design was claimed to help stabilize the interest rate banks charge each other for short-term funds. I totally disagree with this concept. Up until January 2012, European banks had to hold a minimum of only 2% of certain liabilities, mainly customers’ deposits, at their national central bank. As the economic crisis has continued in Europe, this 2% level has been to 1%! The total reserve requirements for Eurozone banks stand at only around 113 billion euro currently. Perhaps now people will understand why I have been warning about a MAJOR financial crisis starting in Europe and spreading thereafter around the globe. The general media and the public will NOT understand the reserve ratio disparity so a banking crisis in Europe will be assumed to be the same around the world. Unfortunately, what happens in Europe will NOT stay in Europe. This is also why I STRONGLY urge Europeans to create a stash in the US banks for now. The ECB is seriously looking at creating a cryptocurrency to defeat hoarding just canceling Euro notes. That will end hoarding and they will be able to then enforce negative interest rates. From the ECB view, they are concerned about the coming bank crisis in Europe so the best way to prevent a bank run is to eliminate cash! Europeans should open accounts outside the Eurozone before it is too late. And Prime Minister Theresa May wants to stay linked to Europe. This is when we need people who REALLY are qualified to understand the world financial system. I cannot express how dangerous it has become with politicians who are clueless about how the world economy even functions. UK banks operate under a completely different scheme. In May 2006, the Bank of England began paying interest on bank reserve deposits at its official Bank Rate. This inspired US banks to demand the Fed pay interest on excess reserves. The Bank of England had the ‘reserves averaging’ regime back then whereby the quantity of each bank’s reserves that the Bank of England would pay interest on was restricted to a range around a ‘target’ level of reserves that the bank was obliged to pre-declare. The used to be set on a daily basis but was changed at this time to an average over each monthly maintenance period. The objective was to establish a marginal cost of reserves to the banks which would remain very near to Bank Rate. However, this was dependent upon the provision if the Bank of England supplied the right amount of reserves to enable the banks’ reserve deposits to be within this range. In view of the Bank of England’s desire that wholesale market rates should remain close to Bank Rate was considered to be an improvement over earlier procedures prior to 2006 when reserves were mot paid interest and the Bank of England then had to supply reserves in quantities that exactly matched demand. Consequently, market interest rates tended to move towards the boundaries of the corridor formed by the Bank of England’s deposit and lending facilities. Nonetheless, under the new reserves-averaging regime post-2006, the Bank of England still had to supply reserves in appropriate amounts to meet demand, but it was more flexible. However, the new regime was still ill-equipped to cope with the expansion of reserve supply that the Bank of England then undertook to overcome the breakdown of interbank markets during the financial crisis of 2007-2009. To maintain interest rate transmission within the reserves averaging regime, the Bank of England then widened the range of reserve deposits that they paid interest on from 1% to 60% trading around the Bank of England’s targets. This required the Bank of England to then take steps to reabsorb the excess reserves. The introduction of Quantitative Easing, which began in March 2009, merely created another problem from the reserve perspective. Suddenly, Quantitative Easing caused another larger expansion increase in reserve deposits. Rather than trying to offset this by selling other assets or making further adjustments to the reserves averaging scheme, the entire scheme was simply suspended in favor of paying interest unconditionally on ALL reserve balances. Consequently, I have stated NUMEROUS times before, all central banks are NOT the same!!!!!!!!!!!!!!!!!!! Central Bank Reserve Ratios COUNTRY Bank Reserve Ratio ALBANIA 10.00% ANGOLA 24-May-18 19.00% ARMENIA 24-Feb-14 2.00% ARGENTINA 28-Sep-18 44.00% ARUBA 11.00% AZERBAIJAN 1-Mar-15 0.50% BANGLADESH 3-Apr-18 5.50% BARBADOS 5.00% BELARUS 16-Mar-16 7.50% BULGARIA 28-Nov-08 10.00% CAMEROON 7-Apr-16 5.88% CAPE VERDE 16-Feb-15 15.00% CEN. AFRICA REP 7-Apr-16 0.00% CHAD 7-Apr-16 3.88% CHINA 15-Oct-18 14.50% DEM. 8-Apr-15 2.00% REPUBLIC 7-Apr-16 5.88% COSTA 15.00% CROATIA 11-Dec-13 12.00% CZECH REPUBLIC 20-May-99 2.00% CURACAO 10-Oct-13 18.00% DENMARK 2.00% EGYPT 3-Oct-17 14.00% EQUATORIAL 7-Apr-16 5.88% EUROZONE 18-Jan-12 1.00% FIJI 7-Jul-10 10.00% GABON 7-Apr-16 5.88% GAMBIA 19-Jun-13 15.00% GEORGIA 13-Jun-18 5.00% GHANA 12-Nov-14 10.00% HUNGARY 1-Dec-16 1.00% ICELAND 1-Jun-16 2.00% INDIA 1-Jul-13 4.00% INDONESIA 18-Feb-16 6.50% IRAQ 1-Sep-10 15.00% ISRAEL 6.00% JAMAICA 1-Jul-10 12.00% JORDAN 12-Mar-09 8.00% KAZAKHSTAN 2.50% KENYA 5.25% KYRGYZ REPUBLIC 14-Dec-15 4.00% LITHUANIA 3.00% MACEDONIA 9-Sep-13 8.00% MALAWI 23-May-08 15.50% MALAYSIA 16-May-11 3.00% MALDIVES 20-Aug-15 10.00% MAURITIUS 2-May-14 9.00% MOLDOVA 4-Sep-18 42.50% MONGOLIA 23-Mar-18 10.50% MOROCCO 21-Jun-16 5.00% MOZAMBIQUE 26-Oct-17 14.00% NEPAL 11-Jul-18 4.00% NICARAGUA 15-Jun-18 10.00% NIGERIA 22-Mar-16 22.50% PAKISTAN 12-Oct-12 3.00% PERU 30-Apr-17 5.00% PHILIPPINES 24-May-18 18.00% POLAND 31-Dec-10 3.50% QATAR 16-Mar-17 4.50% ROMANIA 6-May-15 8.00% RUSSIA 27-Jun-16 5.00% RWANDA 5.00% SERBIA 19-Jan-11 5.00% SOUTH 2.50% SRI LANKA 14-Nov-18 6.00% TAIWAN 1-Jan-11 10.75% TAJIKISTAN 20-Mar-17 3.00% TANZANIA 21-Mar-17 8.00% TRINIDAD & TOBAGO 17.00% TUNISIA 1.00% TURKEY 13-Aug-18 8.00% UNITED STATES 27-Oct-16 10.00% URUGUAY 1-Apr-13 25.00% UZBEKISTAN 1-Sep-09 15.00% VENEZUELA 25-Oct-13 19.00% VIETNAM 1-Sep-11 3.00% WEST 16-Mar-17 3.00% ZAMBIA 21-Feb-18 5.00%
— Read on www.armstrongeconomics.com/international-news/europes-current-economy/us-bank-reserves-10-eu-bank-reserves-1/

EU Regulation Leads to Wholesale Slaughter of Sheep | Armstrong Economics

Posted on by johnbarleycorn12

In Bulgaria, a farmer had one sheep that died unexpectedly and another which grew sick but survived. Both animals returned negative test results for a disease known as ovine rinderpest. The Bulgarian Ministry of Agriculture, Food and Forestry slaughtered the entire herd and paid the farmer below replacement cost to save money for the state and then banned them from having livestock for six months. The government explained in a statement that as an EU member state, Bulgaria can legally institute animal vaccines by FORCE if it is in the essential interests of the community it is affecting. However, if Bulgaria adopts that policy, then the EU automatically imposes a ban on live animal trade and the exportation of meat and dairy products for at least two years following such a decision. Therefore, simply because of an EU regulation, animals are just slaughtered on a wholesale basis even if they do not test positive for a disease but might.
— Read on www.armstrongeconomics.com/armstrongeconomics101/regulation/eu-regulation-leads-to-wholesale-slaughter-of-sheep/