http://www.usawatchdog.com/germany-secretly-planning-on-joining-brics-jim-willie/ Dr Jim Willy has been saying for some time that Germany will join the BRICS Nations which include Brazil, India, China and South Africa. If Germany joins this will speed up the demise of the US $.This will be a powerful economic unit that has both production and high tech abilities.

They already have two banks,CRA or Credit Reserve A/C and the BRICS Development Bank. They want to back their currency with gold.France was told not to deliver war ships to Russia and ignored that sanction. Germany has 3000 companies that do business with Russia and will probably ignore US sanctions also.

The question is for us, can we rely on the USA as an ally as they begin to have serious problems at home? Would we too be better off joining the BRICS as China is our largest trading partner.

No Arjay, we cannot rely on the USA to protect us indefinitely - that's why we need to have our own nukes, biological weapons too.

If Tibetans had nuclear weapons at the time, they would still be free people today.

If the Tibetans had nukes they would not be the same Tibetans the world respects as a peace loving spiritual people. If the Tibetans had nukes back in the 1950's or 60's, and used them in defence, it would have triggered a massive nuclear war and we would all probably be non-existant now.

Is Yutusu saying the world would be a safer place if everyone has nukes and/or biological weapons? Or does he support selective distribution to only the countries he approves. Tough talking from a declared anarchist. Looks more like a quick recipe for world annihilation to me.

No offense but such thinking is as ridiculous as the American NRA's defence of extending the 'Right to Bare Arms' to unlimited assault weapons, machine guns and even bazooka's if so desired.

Australia should stick with the USA and aim to build strong economic relationships throughout the East.

Yuyutsu, my apologies for misspelling your name in previous post.

The entire Western world will "join" the BRICS, as excessive Third World immigration drags our living standards *down* to their level.

Poverty on this planet is not created by China. It is the debt money creation system that enslaves people making them ignorant,having too many children and poor.

Our Western Economic system is on the verge of the biggest collapse before the 1890's Depression.$1500 trillion is tied up in the gambling derivative market to which our shares and pension funds are connected. This phoney derivative market is 21 times the GDP of the planet. When it comes down our money will be worth zilch. This is why the BRICS Nations want a new monetary system.

Poverty on this planet is not created by China.
Arjay,
My believe also. It is created by those western greed mongers who exploit China & other countries for cheap labour & massive profits.
Those Brand-name greed mongers need to be combed through by tax departments.
We consumers are put into a situation where we really can't purchse anything not made in sweat shops because of the greed mongers, thereby making us guilty by association.

Indy, what is a low wage sweat shop to you is still a happy escape from rural subsistence farming hell, & often near starvation, for millions of Chinese.

Germany jumping ship would spell the end of the disastrous experiment called the EU. That should save the member states billions, & perhaps even return them to prosperity. What to do with half a million useless bureaucrats would then become a problem. We would have to be careful they didn't try to export this bunch of freeloaders to Oz, to get rid of them.

Next how do we disband that other disaster, the UN.

escape from rural subsistence farming hell, & often near starvation, for millions of Chinese.
Hasbeen,
Of course I'm aware of that but it is still exploitation & that's my gripes. I recall an Australian sheilah bartering in Indonesia for a difference of 20 Cents. The stupid cow thought it was a hilarious game whilst the poor bloke selling soup from his homemade trolley was trying to feed his kids. It's a matter of the West cultivating a mentality which is very quickly becoming it's Waterloo & I don't mean that in toilet kind of sense even though the mentality of many is toilet level.

There is an old saying, keep your allies close but your enemies even closer. During WW2 they drew a line just above Brisbane where the Japanese would be stopped. We cannot trust the USA to protect us when the civil unrest happens.

The USA is in deep trouble with the Central Bankers having total control of money and Govt. In real terms according to Dr Willie they have had 4yrs of negative growth. The only growth has been in the money supply. The same can be said about Australia. Abbott is de-industrialising this country. The real rate of inflation is way above 3%.Since our inflation is created as debt by private banks, we just sink deeper into the mire.

I say we go with the BRICS on the proviso that we can create much of our new money debt free by Govt banks just like Russia and China does.

Abbott is de-industrialising this country.
Arjay,
Abbott can't because Rudd/Gillard beat him to it. Secondly, Abbott is not doing that anyway, that's just what you want us to believe. Labor got us into the mess that you acccuse Abbott for now. You're not very observant are you ?
If I gave you $10. & asked you to get lunch for 20 people, what would you do ? Blame yourself for not manging to get lunch or blame me for not givining you enough ? Need I say more ?

Dear ConservativeHippie,

<<Tough talking from a declared anarchist.>>

This is not completely accurate: I do deny any right of anyone to rule over another against their will, but if consent is given then I see no problem with having states and governments. The only fundamental problem with existing states is that participation is not voluntary.

<<If the Tibetans had nukes back in the 1950's or 60's, and used them in defence, it would have triggered a massive nuclear war and we would all probably be non-existant now.>>

If the Tibetans had nukes in 1950, then all chances are that they wouldn't be attacked, so they wouldn't need to use them.

Tibet HAD an army. It was voluntary and highly motivated, but alas it was small, ill-trained and ill-equipped.

BTW, there couldn't be a massive nuclear war in the 1950's because the Chinese didn't have nukes yet and the number of bombs worldwide was small.

<<Is Yutusu saying the world would be a safer place if everyone has nukes and/or biological weapons?>>

I was only saying that Australia would be a safer place.

<<does he support selective distribution to only the countries he approves>>

I didn't mention distribution: Australia should build its own nukes.

<<'Right to Bare Arms'>>

Who and why are you asking for 'Rights'? If a massive enemy threatens to kill or enslave you, then you do what it takes, you don't ask for permission.

<<Australia should stick with the USA>>

Tibet begged America to save her from the Chinese, but America turned its back. What makes you think that when push comes to shove, Americans wouldn't rank avoiding a nuclear winter above the freedom of Australians?

Oh wouldn't it be wonderful.

That would be the end of the second most corrupt organisation on earth, the EU. I'll bet many are praying for it.

We would have to have the navy out in force if it happened. Just imagine how many of the half million or so bureaucrats would be displaced.

There would be a whole new market for people smugglers in EU bureaucratic refugees looking for a public service to infect, & ours would be a prime target.

Then we could really get serious eliminating that most corrupt organisation, the UN. How many corrupt bureaucrats would that send out looking for a victim to infest.

Ageed Hasbeen on the UN elimination. Nigel Farage of UKIP is almost as big as Labour. The EU is falling apart. Christine Lagarde recently hinted at the IMF having a role in a new world currency as an extension of special drawing rights. The IMF has no money or gold to back it with. Some are saying that China and Russia could have 40,000 tons of gold. So in this era of money printing,would sane Govts use the Yuan backed by gold or the IMF fiat counterfeit stuff?

This is why the Western Oligarchs want war with Russia and China. They are losing their power because of their own greed and have destroyed their own economies. When Putin stopped them going into Syria, this was the big game changer. Putin also knows that if they get their defence missile shield in the Ukraine this will threaten their security.I'm hearing Putin will soon move on the Ukraine and just take it.

We've always lived in dangerous times with these power hungry war mongers but this is probably the worst.

The EU is to Europe what Labor is to Australia but the Europeans have woken up. 50% of Australians are still waiting for the alarm to go off.

Arjay, it's good to see that your enthusiasm for all things anti-American continues unabated. It makes enjoyable reading - of the laughing-out-loud sort, in fact.

As usual, this thread's chuckle is caused by the clear indications that you don't actually understand what you are writing about.

>>They already have two banks,CRA or Credit Reserve A/C and the BRICS Development Bank.<<

The BRICS grouping has recently established the New Development Bank, which is a sort of World Bank/IMF clone, with a capital target of $100bn ($10bn each now, another $10bn each later). It is denominated in US$, interestingly. To put it into some perspective, Westpac alone has a balance sheet more than five times the size of the NDB.

The "CRA" you talk about is not a Bank. It is a Contingent (not Credit) Reserve Account of another $100bn - also denominated in US$ - that is a pool of money teach country can dip into if they get into trouble. Here it is in full:

http://www.pbc.gov.cn/publish/english/955/2014/20140717154639176510565/20140717154639176510565_.html

It is in effect an inter-member stability fund. It has two instruments,one is designed to be used in response to actual short-term balance of payments pressures, the other to potential short-term balance of payments pressures.

The creation of the NDB is a good, wholesome and welcome development, and stands as legitimate competition to the activities of the World Bank and the IMF. However, it is only a rabidly one-eyed anti-West observer who could read into it anything more sinister than another potential source of loans for developing economies.

>>They want to back their currency with gold.<<

The NDB is a Bank, not a currency. And you may have noticed that there is no hint of either the Bank or the Contingent Reserve Account being backed by gold, or any other mineral for that matter.

As for Germany "joining the BRICS", why would they do that? It has absolutely nothing that they want or need, financially or politically.

And finally, t is worth pointing out that bilateral trade between the US and China reached close to $600bn last year.

Drop, meet ocean.

Arjay "backed by gold"

Gold only has a value because people say it does.
Same with pieces of paper or digits in a bank computer record.

In reality, *nothing* has any "value".

Gold, paper, digits or anything else humans invent or use only has a value because we say it does.
Gold is no more valid a form of valuation than seashells.

I find all this pro-gold/anti-paper propaganda both amusing and sad.

Pericles the BRICS capital is more like $500 billion. Our banks have derivative exposure of $22 trillion and their money printing does not equal productivity. China has the productive capacity and Russia has the technology and energy. Germany joining the BRICS will end the EU and the power of the US Federal Reserve. This is why they want war with Russia/China.

The US people are fine, it is the banking parasites who are destroying their economy and ours,that I take exception to. Your invective and ad hominem says it all in regards to your credibility. You think it is just fine for the Wall St criminals to steal from the people via money printing and derivative scams.

Shockadelic gold only has value because of its rarity and women like wearing it. Gold has uses in electronics but silver has 10,000 uses in industry and is far cheaper. Our fiat currency is now coming to an end because of the greed of our central bankers.

Precious metals are rare,a medium of exchange, store of wealth and portable. Max Keiser now has a cyber currency called Maxcoin backed by silver. He knows the BITCOIN bubble can collapse again unless something of value backs it.BITCOIN does not grow fast enough to equal growth. Thus this coupled with speculation sees its value sky rocket.

Fiat currency can work if responsible people control the supply. This means having a formula that limits banks and Govt from creating too much. Inflation is a form of taxation since it depreciates our spending power and savings.

Many are now saying the derivative bubble is $2000 trillion. This is 28 times the GDP of the planet. Total of precious metals is about $15 trillion. Many of our assets like housing are way over valued. When the collapse happens,where does all this money go? It is called hyper-inflation.3 things will become very expensive. Food, energy and precious metals.

Still driving the fact-free highway I see, Arjay.

>>Your invective and ad hominem says it all in regards to your credibility.<<

Pointing out your inaccuracies is hardly either of these, I think. No matter, back to the facts.

>>Pericles the BRICS capital is more like $500 billion<<

I have no idea what you believe constitutes "the BRICS capital", but it is a matter of record that the five nations involved with the NDB have only stumped up $10 billion each at this point, and have agreed to another $10 billion some time in the future. Probably when they have decided where they will start investing the dough, because as you know, they haven't lent a red cent yet.

NDB is an investment bank that intends to make loans to infrastructure projects without the onerous IMF-style conditions. Mind you, we have yet to see exactly what conditions they will impose - I doubt if they will be in the business of gifts, after all. But one thing is for sure, there is no BRICS currency, nothing they are doing is backed by gold, and it has sod-all to do with warmongering. As I pointed out, there is $600bn of bilateral trade involved, between China and the US alone.

Here's today's biggest Arjay dream-bubble though, it's a doozy:

>>Many are now saying the derivative bubble is $2000 trillion.<<

Since you have made it abundantly clear in the past that you haven't the faintest clue how derivatives work, you can pick any number you like and it will still be utterly meaningless.

Like this one.

Tell us oh mighty Pericles how your derivative scams work. Even those who work in the scams do not fully understand them because they are designed to this way like tax law.

If they a form of insurance how can they be worth many times the real assets ? It's a big bubble ready to collapse and that's why a Glass Steagall Act is crucial to our survival. More lies and deception from your ilk.

I'll try, Arjay. Although history tells me that it will be a waste of time.

>>Tell us oh mighty Pericles how your derivative scams work. Even those who work in the scams do not fully understand them because they are designed to this way like tax law.<<

Try this:

http://www.napf.co.uk/PolicyandResearch/DocumentLibrary/0356-Derivatives-and-Risk-Management-Made-Simple.aspx

Although the NAPF wants to charge money for this, you can get a free copy online by going to www.jpmorgan.com and typing NAPF into the "Search JP Morgan" box at the top of the page. Here you will find out all you need to know.

Especially Section 4. Market Risk Methodologies, where the concept of "netting" is discussed.

"The global exposure is the absolute value of the notional exposure of each individual derivative after applying any hedging and netting benefits of longs and shorts. It is a metric reflecting the net leverage and provides a better understanding of the net derivative exposure arising from derivatives in the portfolio compared to the gross notional exposure metric"

In layman's terms, this means that you can ignore the "gross" position, and simply keep an eye on the position after you have balanced out the long and the short positions.

Which is, in a nutshell, why you don't have to keep awake at night worrying about your figure of "$2000 trillion" [giggle] in the global derivative market. That's like saying I have a mortgage of $500k on my house, and my house is worth $550k, so my exposure is $1.05 million. When quite obviously you are $50k ahead of the game, not a million plus in hock.

Let me know when you have digested that simple concept, and I will be happy to respond to any further questions you may have.

In other words it is gambling. They bet against their own stocks so if they go down they win on the derivatives.The whole market is zero sum gain. Everyone is betting for and against losses/gains.It is an appendage parasite of the real market and when it goes will take us all down. Your definition of derivatives is a BS of generalisations which define nothing specific.That's the way they like it.

The banking derivatives have priority over depositors ie unsecured lenders and share holders. My bank calls it a form of insurance. How can an insurance policy have a greater notional value than your assets? The derivative losses must be honoured first. This is why they want to bring in "bail in " to cover their expected derivative losses. Since all the QE ie money printing, the derivative market has doubled. Only those scamming the system thinks it's OK.

Dear Arjay,

I agree that what is going on in the financial markets is wrong and immoral.

I agree that Australia should back the Australian dollar with gold - and we have enough gold for that in our soil.

We should either carry physical gold coins in our pockets, or their paper/electronic representation.

What I do not agree with is joining any block of common currency with other countries. I just can't understand why you want it.

Arjay, gold only has a value because of ancient myths and superstitions that made it "special" in the first place.

"Our fiat currency is now coming to an end"

Paper/digital money is a far too convenient and easily comprehensible form of valuation/exchange for it to "end" altogether.

Currencies may be severely reevaluated, but they won't vanish.

"3 things will become very expensive. Food, energy and precious metals."

And only two of them will keep you alive.
Try buying your groceries with precious metals.

"In other words it is gambling."

The trading of shares, not just the derivatives, is too.
Do you think any of those automated e-trades are "investments"?
Bull/bear = red/black.

"What I do not agree with is joining any block of common currency with other countries. I just can't understand why you want it."
Yuyutsu I said we should join if we are allowed to create our own money debt free which currently is not the case with our Govt.

Shockadelic, Backing currency by precious metals stops the production of too much fiat money. There has to be some limiting factor to bring back stability. Remember that the currency will only be backed by a small % of gold. The Elites in 1872 replaces all the cheap silver money with their gold thus bringing on the 1890's Depression. You don't make gold an absolute unit of money. It only backs the fiat money, limiting over supply. A ton of gold is worth about $50 million so there will have to be a ratio of say 50:1 gold to currency. Perhaps BITCOIN will refine itself into a more stable currency.

"There has to be some limiting factor to bring back stability."

I don't see what gold has to do with that.

You can limit inflation by printing fixed amounts of money and stopping fractional-reserve banking.

Gold is not itself immune to inflation.
As it becomes more difficult to find new sources, won't it's value go up, up, up?

Sure, if you like.

>>In other words it is gambling. They bet against their own stocks so if they go down they win on the derivatives.<<

In much the same way as insurance is gambling. You bet against not having an accident in your car, so if you do, you get a payout.

It's about exposure. If you do not insure your car, you will lose a bundle if you crash it. If you insure your car, you pay out some money each year, and only get any of it back if you have an accident.

Let's take the simplest possible example. If you buy a bunch of computers in US$ from Taiwan, you agree a price that gives you a profit margin. Until they arrive in Australia - bearing in mind you might commit to a year's worth of stock - you are exposed to losing money on the exchange rate if it goes against you. So you lock in an exchange rate - and your profit margin - by buying forward dollars at a specific rate.

It gets a lot more complex than that, of course. Your forward currency contract now has a value of its own, so if at some point you think there is a better chance that the exchange rate will benefit you, you can trade that instrument on to someone who - say - wants to hedge in the other direction. Think of that on a larger scale, and you have the essence of the derivative market.

But again, the key metric is always the difference between the put and call options, and not, as you insist on believing, the two of them added together.

Pericles I've checked the stats on world derivatives and $2000 trillion is not an exaggeration. This represents $285,000 for every person on the planet and they are woven into the real productive market.

What happens when infinite money meets finite labour, energy and resources ? Hyper-inflation, stagflation and worse. As Gerald Celete ,Max Keiser and many others say,it is not a matter of if, but when the really big collapse happens.

Shockadelic, nearly all the traditional forms of assets are over way over valued. Gold during the Great Depression was $35 per oz. We've had a 40 fold increase in inflation which gives us todays price of approx. $1400 per oz.However never before have we had so much money printing on a global scale and the pop is 3.5 times today. You have to start looking at other assets as your super will be worth nothing in a global monetary collapse. Also note that even money in the bank is not safe as plans for "bail in" are on the cards.

Other assets not over valued are farm land, some commercial, some artwork, some diamonds, opals, and precious metals. Gold and silver shares are not doing well because the cost of production is more than 50% of the market price. Our residential land is way over valued by at least 40-50%.Foods that can be stored are also a good investment.

You keep missing the point, Arjay.

>>This represents $285,000 for every person on the planet and they are woven into the real productive market.<<

Try reading this Slate article all the way through - it shouldn't take you long.

http://www.slate.com/articles/news_and_politics/explainer/2008/10/596_trillion.html

The article was written in 2008, so the figure they use - $596 trillion - could well have moved today to the $2,000 trillion you refer to. But, as the article points out, this is an aggregate of all contracts, puts and calls, and therefore is not a measure of exposure at all.

"Within that $596 trillion are derivatives that effectively relate to the same assets—if you have a contract to buy euros in January and I have one to buy euros in April, we may end up buying the same currency, but its notional value will get counted twice. Moreover, in many instances, the "notional amount" is just a benchmark that never even changes hands—as in the case of the interest-rate swap, by far the most common type of derivative. Likewise, because derivatives are often used to hedge risks, there's a good probability that many contracts in the system essentially cancel one another out."

As the Financial Times put it, in the same year...

"Gross numbers are no basis on which to estimate the impact of the market in credit derivatives; net exposure is the place to start."

Hope this helps calm your fears.

Pericles I've seen people who deal in them interviewed and they don't understand the ramifications.$596 trillion is still 8 times the GDP of the planet. If our banks were healthy,they would not need to deal in them. The market is based on faith and once the panic hits,there no amount of QE will save it.

You are still missing the key point, Arjay.

>>$596 trillion is still 8 times the GDP of the planet.<<

It doesn't matter a fig whether it is $596 trillion or $2,000 trillion. The important number is the difference between the puts and calls.

Let me make it very, very simple.

There's this guy in the pub tossing a coin. One onlooker bets $10 it will come down heads, the other bets $10 it will come down tails.

If it comes down heads, one guy wins ten bucks, the other one loses ten bucks. But the total amount of money in the pub has not changed by a single cent.

You would understand all of this if you read some factual documents, instead of echoing the garbage you find on conspiracy web sites.

Arjay, if so many assets are overvalued, wouldn't the bursting of those bubbles cause prices to go down, not the opposite, hyperinflation?

Very good and has many improvements exciting new.