STAFF NEWS & ANALYSIS
Central Bankers Use Brexit to Argue for Increasing Financial Centralization
By Daily Bell Staff - July 01, 2016

Kiss Your Domestic Bias Goodbye, Central Bankers of the World … In a globalized world, managing domestic economic conditions requires having one eye focused abroad. For evidence, look no farther than the global monetary policy fallout from Britain’s June 23 vote to leave the European Union. – Bloomberg

Brexit reverberations continue to generate calls for more central banking coordination.

Just yesterday, we wrote about Mario Draghi’s demand for more centralization, HERE, and now we seen a Bloomberg article on the same subject.

More:

A Federal Reserve official said U.S. monetary policy needs to take global events into account.

The examples all point in one direction: If you’re a central banker concerned with your own nation’s economy, you can’t afford to ignore the international context.

The article quotes Robert Kaplan, president of the Dallas Fed as saying in a Thursday interview, “… In order to serve the United States, we’ve got to be aware of, and up-to-date on, financial and economic conditions globally.”

Kaplan also said that globalization had tied together the fate of major economies and that the tumultuous market-fallout regarding Brexit was another sign of the necessity for this increased coordination.

“Is there contagion? What does Ireland do? What does Scotland do? What do other EU countries do?” Kaplan said. “It will take a significant amount of time to see how all that unfolds.”

The article makes it clear that Draghi’s comments on Tuesday were not casual ones.

Brexit is obviously being used as justification for more overt centralization. And this seems to include more coordination with governments as well.

Ultimately, the arguments point towards all sorts of financial consolidation sooner or later, including a worldwide central bank and a consolidated currency.

More overt coordination of monetary policy worldwide will also lead to increased volatility and market swings. This is the opposite of what central banks would argue will happen but historically speaking increased centralization always creates market difficulties.

Our perspective has always been that these difficulties are intended to take place because each market crisis allows participants to call for more centralization, which is the ultimate goal of central  bankers and officials at the Bank for International Settlements.

Conclusion: As this centralization continues to take place, we would not be surprised to see coordination yield to additional, considerable market swings later in 2016. The remedy that central bankers are contemplating as a result of Brexit is one that traditionally aggravates volatility.

Posted in STAFF NEWS & ANALYSIS
  • Bruce C.

    These spokes “persons” for the monetary system are a bunch of morons.

    What “Brexit reverberations”? I don’t see why the financial markets gave a damn about Brexit in the first place but as of today that’s old news anyway.

    These guys are shooting themselves in the foot by losing their cool and acting too quickly. There is no obvious financial crisis or even much financial market volatility to speak of right now. I don’t understand why they didn’t create more problems first before so magnanimously offering their solution.

    People are catching on to globalist game and they don’t like it. It’s becoming increasingly known that many problems have been caused by the very things that the elite sociopaths and narcissists want more of.

    Central bank predictions and economic analyses are famously wrong, so people are not trusting them as much. The failure of the economy (and not just the US) to improve as they said it would is a recent example, along with the failure to create the price inflation they want (even though that’s actually a good thing), and their lack of conviction enough to raise interest rates as they’ve been wanting to do. They are losing credibility. They’ve actually demonstrated that they don’t know what they’re doing and are usually wrong.

    This isn’t a good time for them to be asking for a promotion.

    • esqualido

      The most amazing thing is that the Fed is still generally portrayed in the media as the Good Fairy, albeit at times confused, when the fact is they both conduct the greatest shell game known to man as well as to contribute directly to currency destruction. In a free market, the markets and the multitudes determine where interest rates go, but this immense power has been granted to a privately owned corporation that happens to run a huge secretive New York trading desk. They very effectively massaged public expectations of several interest rate hikes in 2016, and could have profited massively by pulling the rug in June. To the extent that the government, largely under the control of the banks that own the Fed, can be persuaded to heap up new debt, they are free to provide virtually interest-free funds to these same banks (all the time arguing that because of the size of the debt, rates cannot go up much if at all). Unlike the cockroach, who at least has the modesty to flee when the light goes on, they are shameless, as in Draghi’s recent call for even more centralized control.

  • nameless

    Its humorous that The Daily Bell swallows their propaganda.

  • rahrog

    The Ruling Class was moving toward a one world central bank and one world monetary unit prior to Brexit. Folks all over the world are catching on to TRC’s rigged market games. Brexit is about freedom of choice, not what some market happens to be doing on a given day.

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