STAFF NEWS & ANALYSIS
The World’s Economic System Failing Fast: China on Brink
By DailyBellStaff - September 29, 2016

ECB and Italy’s bank rescue fund head clash over bailout rules …  The European Central Bank and the head of Italy’s bank rescue fund clashed on Monday over the European Union’s tough conditions on state aid for troubled banks.  Speaking at the same conference in London, one of the ECB’s most senior supervisors said EU states should follow the bloc’s rules when it comes to dealing with problem banks while the head of Italy’s Atlante fund called the resolution process “absurd.” – Reuters

More bad financial news. Italy, Germany and China continue to decay economically as they move toward financial catastrophe.

Banking sectors are trembling and on the way to toppling. Meanwhile, in China, one of the country’s top businessmen just issued a warning that the country’s dreadful real-estate bubble could pop at any time.

This sort of horrible economic narrative is not a coincidence. It has been painstakingly put into place by the world’s elites. It takes a lot of time and effort to shake the prosperity of seven billion people.

But by establishing the dead hand of central banking around the world and then pumping money for decades into the world’s swollen coffers, the grand debacle has been painstakingly prepared. All that is needed now is a shove.

First you create monopoly money issuers – central banks – that can print as much money as their controllers choose. Then you turn on the printing presses and flood the world with money.

Finally, you encourage people, industries and governments to borrow more than they can afford.

This, in simplest terms, is how you destabilize the world’s economy. It may take a 100 years, or 50 or 10, but by encouraging borrowing and supplying the necessary cash, the economic debasement can evolve as necessary.

We call this “directed history.” The catastrophe now looming is supposed to look both natural and inevitable but it’s not.

That doesn’t make it any less frightening. Germany’s largest bank, Deutsche Bank is on the verge collapse and now comes word that Germany’s second largest bank, Commerzbank  intends to cut almost 10,000 jobs and stop paying dividends to shareholders.

Meanwhile Italy and Europe are fighting about Italian bank solvency. Italy wants to put cash into bankrupt Monte dei Paschi di Siena. But EU rules bar state aid to banks except as a last resort.

More, from Reuters:

“There are European rules and those rules have to be followed,” Ignazio Angeloni, a board member of the ECB’s banking supervisory unit told Reuters on the sidelines of a conference organized by Imperial College’s business school.  The rules, known as the bank recovery and resolution directive, set out “modalities” that must be followed in order to “understand what can be done”.

What this means, basically, is that  the arguing continues while Italian banks continue to topple. It’s not just Germany or Italy either. Portugal, Spain and Greece also have bank sectors on the verge of falling apart.

In China, the troubles are even larger as the sector jeopardizing the solvency of the Chinese economy is not banking but real estate – and real estate drives the entire economy of 1.4 billion people.

Here, from CNN:

 China’s richest man’s Hollywood ambitions Chinese billionaire Wang Jianlin made his fortune in the country’s real estate market — and now he’s warning that it’s spiraling out of control.

… After struggling to contain the fallout from the stock market debacle, China’s leaders could face a similar headache in the real estate sector.

The big problem, according to Wang, is that prices keep rising in major Chinese metropolises like Shanghai but are falling in thousands of smaller cities where huge numbers of properties lie empty. “I don’t see a good solution to this problem,” he said. “The government has come up with all sorts of measures — limiting purchase or credit — but none have worked.”

The ongoing banking debacles in Europe could help kill the euro and maybe split the EU itself down the middle. The inevitable deflation of the Chinese real-estate bubble will sink that giant economy into catastrophic depression.

As Europe and China dissolve, the US’s sky-high stock market will deflate as well – maybe in a crash that will far exceed 1929.

Again, it is easy to see these various events as disassociated from one another but they are not. They are all the product of central bank money printing and a determined campaign to ensure that borrowing worldwide outstripped solvency.

The terror of the world’s current climate seems vast and complex but it is really very simple. And the reason behind it is simple too. Those elites running the world want to create heightened global governance.

They intend to destroy the current system in order to replace it with a new one.

And thus, when it comes to the onrushing financial catastrophe, there is probably no turning back. Billionaires and financial executives have been warning about what is to come with increasing frequency and fervor.

No less an authority that former chief economist of the Bank for International Settlements, William White, told the UK Telegraph at the beginning of this year that  the current world economic system is insupportable and that a debt-based collapse is inevitable.

He has called for a global jubilee, of the type that used to take place where debts will be forgiven and financial records expunged. He says nothing less will do if the world is to revive itself economically.

Certainly it is possible that bankers will attempt some sort of jubilee as a way to support people as they restructure the world’s economy and further centralize it.

The tools as usual will be a combination of “carrot and stick.” It is easier to move people where you want them to go if they are broke and desolate and you are holding out the promise of promise of free – “jubilee” – money.

We can see the gradual deterioration of the world’s economy but we are not fooled about the course it is taking nor do we wish to provide false hope about the eventual destination.

Again, this is planned event driven by monopoly central banking, money printing and decade’s of elite determination to indebt the world.

The system is artificial. It has been built from the ground up for just this purpose.

If you can absorb this message; if you can comprehend that you, your family, your community and your country are the target of the catastrophe to come, if you can internalize the disaster now being cultivated, then perhaps you can find ways to take action to minimize its effects.

We’ve stated the solutions many times. It includes positioning yourself to have access to food, potable water and housing even in the face of another Great Depression. Having physical gold and silver close by is also important – and also a way to protect yourself.

The current economic climate is insupportable and worse is to come at some point, though the timing is as yet unclear. It may well be that the catastrophes tip over into hyper-inflation as is now occurring in Venezuela. Prepare yourself now, gradually or all at once. Again, what’s going on is planned.

Conclusion: There is determination behind it, as horrible as that is to say. None of this, ultimately, is by coincidence, anymore than the planting of 100-plus central banks around the world is coincidence. The system is meant to fail. But you don’t have to fail with it.

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  • Samarami

    “…But you don’t have to fail with it…”

    Absolutely. I can be free. Here. Today. Where I’m “at”.

    So can you.

    Sam

    • Sven

      That thinking always sounds good until where you are “at” is hell.

      • MarkinChrist

        It still works there, when it is based upon faith in Jesus Christ. As Paul said, “To live is Christ, and to die is gain”. Now you can truly bwe free.

      • Samarami

        If where you’re “at” is hell, then I can’t help you come out. But I must not contribute to your staying there. Sam

      • Don Duncan

        Each of us must free ourselves mentally. That’s the first step. No one can take it for us. That’s reality.

    • Praetor

      Abstain from Beans! Correct! And may more people learn to Abstain!!!

  • Bernz

    You are correct with one exception. All of the European and Asian turmoil will initially lead to a stock correction. But with no currency other than the Dollar to turn to. The US share market will rise precipitously as foreign capitol flees both bonds and foreign stock markets. The term “Emerging Markets” will have the same inference as the name Enron.

  • georgesilver

    Monday morning no Deutsche Bank?
    Got Gold?

  • FreeOregon

    Jubilee? Yes! All debt, private as well as public. For the moment forget the constitutional niceties. What’s needed is a new, clean, level playing field. To do this you need to invent a way to make creditors whole. The creditors are the ones who stand in your way.

    One suggestion: A new currency, not based on debt. Just Greenbacks. Simply pay off all the debt with new paper. Leave people with their assets, the means of production, a basis for a new beginning. Then, if creditors still want to lend, and people want to borrow, fine. No government borrowing. Not needed. This is, after all, the Age of the Pushbutton. How to limit money supply when rascals run governments? That’s a huge issue. But remember, debt based currency failed to constrain the greedy professional pigs at the trough. A limit, like 3% of GDP would make sense but we know the government lies. Big time. Now. One part of a solution: no professional politicians. What’s the point of electing people with government experience when what they’ve learned is how to lie, cheat, mislead, and live off the production of others?

    • natural human

      I’ve been periodically advocating debt free money in the comments section for several years, but the DB flatly refuses to go there. Which is curious.

      • We are a libertarian publication. We don’t believe in monetary monopolies. If someone or some group wants to issue debt free money that’s fine. If the government wants to issue it via monopoly that’s not fine. Not a very difficult position to understand in our view. And not “curious.”

      • StarValentine

        The Daily Bell has gone there numerous times. I can’t speak for this iteration of the blog, but the last one went there, all the time. There was one lady they used to mention here and there who was a big proponent of this debt-free money idea you speak of. The libertarian approach to currency is quite clear: currency competition. Of course, any type of fiat would not be very appealing if commodity-backed money also existed.

    • Wade House

      Agree 100% with everything you said.
      DEBT-FREE Money is the absolute best way to go!!!

      Greenback, Silver Certificates, T-Notes(U.S. Treasury), C-Notes (Congressional/Constitutional/Coinage) Certificates IE ;
      “Congress shall have the Power to Coin money and Regulate the Value Thereof, and of Foreign coins…” – Constitution US: Art. 1, Sec. 8

      I’m also an advocate of ending the Fractional Reserve System in America…that played a large part in getting US into this mess!

    • esqualido

      Herbert Hoover got a bad rap when the stock market bubble popped in 1929 and the U.S. went into Depression, but he had been an extraordinarily efficient and effective administrator, from the days when as head of the U.S. Food Administration during World War I,his humanitarian relief efforts in wartime Belgium were credited with saving a million people, to a well-administered program of Mississippi flood relief. As the United States Secretary of Commerce in the 1920s he promoted partnerships between government and business, particularly in establishing a national electric grid.
      However, as a self-made millionaire, he believed in personal responsibility for debt, and, in bankruptcy, for corporate assets to be forfeited to the next viable creditor. This solution, rather than a more politically correct one, was eminently simple and fair. But when his Treasury Sec. Mellon called for “liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate… it will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people,” Hoover was branded as insensitive, and combined with truly insensitive handling of the Bonus Army marchers on Washington, his fate was sealed. Nonetheless, Mellon was right. Now we are suffering the consequences of a phony “Compassionate Conservative” George Bush, who increased the national debt by the SUM of all previous debts, and an even more irresponsible Barack Obama who pledged to halve the deficit but instead tripled it.

  • Praetor

    If you can absorb this message. Prepare your selves.

    Jubilee, emancipation and restoration or the right of redemption, (buy back). With these evil doers, you will have a right to buy back your freedom if you can afford it. Buy back your liberty and they will allow you to continue in their game of collectivist governance and control, if you cannot buy your liberty life will continue to be chaos and destruction. If you can absorb ‘their’ message, you will see they offer nothing more than another system that will fail. All their solution lead to destruction.

    The message is always get prepared and the time is now!!!

  • Louis Hissink

    And then I was thinking about what the Bolsheviks did in Russia – their goal was to eliminate the middle class – a category hated both by the proletariat and elites. This involved the physical elimination of the bourgeoise.

    There’s another way however – eliminating them economically by trashing their wealth and printing enough to enable government issued bonds to bail out banks and buying their mortgages. A rather interesting way of gaining control of private property.

    One question always arises however. If after the massive deployment of QE’s one wonders where the ‘cash’ is sitting? This is the cash/credit that the banks are supposed to lend to the entrepreneurs who will kick start the economy, but the bank’s are not lending, so where, I wonder, is all this fiat credit sitting?

    What QE has done is trashed the global middle class, and the only political movement with that as a goal are the socialists who are, actually, in charge as well.

    I wonder how long it will take for these latter day utopians to realise that then as now, their policies of central planning and wealth redistribution will not work.

  • StarValentine

    If central banking can never go away, and the republic is as gone as the republic after Caesar’s assassination, and the new age is here whether we constitutionalists, libertarians, anarchists, and Catonian republicans like it or not, then there are some changes that can be made to the institution of central banking to at least make it honest:
    First and foremost, it should be a priesthood. It is absurd that a role of such absolute and God-like power, like the sole right to issue a nation’s currency, and conjure it from thin air, is entrusted to mere men with the same desires and motivations as all the rest. The central bankers should be sequestered on their own grounds, like monks in a monastery, and they should be wards of the state, supported by the taxpayers as they live out their lives on the central bank monastery grounds. They should be barred from communication with any member of the public on penalty of death, including their own families, ditto for leaving the boundaries of the sacred grounds. All communications with the public should be done through an intermediary, twice a year, and the person picked to relay their message should be randomly selected from the phone book on the day of.
    This way, at least the quackery is fair. This is respectable, honest technocracy quackery. It is absurd to let some guy motivated by “hookers and blow,” or the desire to own a mansion and a yacht, be the head of such a solemn and important institution. If we’re gonna let these people rule our lives and have this extraordinary power, then they should live like Vestal virgins on the peoples’ dime, for life. I’m dead serious.

    • Don Duncan

      “…if we’re gonna let these people rule our lives…”??? You are on the wrong site. We are libertarians, voluntaryists, not minarchists. We don’t accept statism on principle, which means we know it can’t be fixed by compromise or made “honest”. If our theoretical arguments are too complex for you to be bothered with, just look at the history of humanity. Govt., the system of ruled and rulers is unsustainable. It always fails, leaving chaos and destruction, out of which ashes a relatively free society rebuilds, only to be slowly parasitized by statists using the superstition of authoritarianism. Breaking the cycle with a new paradigm of voluntarism is the only answer. Nothing less will do.

      • StarValentine

        Says the guy who hasn’t kicked over a single moneychanger’s table. I’m just calling it like it is. Since the commitment is to nonviolence, WE ARE GONNA LET THEM RULE OUR LIVES.
        Even the patriotic Roman senators, who had no such commitment and actually killed the tyrants Gaius Julius Caesar, Gaius Germanicus Caesar, and Nero, still never got back their republic, or even came remotely close.
        In fact, today, 2,000 years later, the hopes of these senators are widely regarded as a laughable dream.
        I’m sorry to say, but you have ZERO basis for that three sentences you typed, ZERO.
        The Roman empire lasted another 500 years after the death of the republic, and with a much more pliant and unfit, de-masculinized, emasculated, feminized population today, along with the most devastating military capability in human history, and an all seeing electric eye, there is every reason to believe the empire this failed republic will morph into will last just as long.
        I never said central banking worked, I said we should at least insist that the quackery be fair, thinking that was something all of you believers in nonviolence might actually have the courage to do.

        • Don Duncan

          Gandhi proved the power of passive resistance. It forced an overwhelming empire to give up a precious colony. He also noted that it takes courage not to become a martyr. Intellengent resistance is harder than blind rebellion. And it’s the only way to achieve victory against overwhelming force. The Roman senators needed to start a grass roots movement which replaced the old system with a better one. Did they want that? Did they know a better political system? No. ls it any wonder they failed?
          What do you have against money changers? Have you ever been in a foreign country and needed to buy something? What would you do without this service?

          • esqualido

            There is no such thing as passive resistance where central banking or the IRS is concerned. A non-filer once argued that the IRS had no claim on him, as the law to create it had been improperly enacted. He was right, and went to jail. The closest we have got to passive resistance is to pull cash out of banks to prevent being NIRPed; notice how assiduously they have been working to eliminate cash altogether.

          • StarValentine

            Exactly.
            Wesley Snipes
            Irving Schiff
            Attorney Tony Serra

            Just to name three.

          • StarValentine

            So you thought “kicking over the tables of the moneychangers” literally meant kicking over the currency exchange kiosks in the airport. You really thought my thesis was that these specific businesses are what ails the globe. You couldn’t see that “tables of the moneychangers” was a blanket reference to money power and corruption.
            I don’t believe it, Don. I believe you are either a gubmint troll or a bot.

  • Crimson King

    Very good synopsis, and worthy of sharing with friends and family who aren’t awake, at least in hopes they’ll do a little bit of preparing. Frankly, it’s hard to imagine that most people don’t have even the slightest clue about what’s going on and how we’re the targets. The propaganda, the brainwashing, the mind control is that thick and it’s lifelong as well. Poor sheeple. I used to be one of them, so I still do have a modicum of compassion for those still asleep, but not much admittedly. Unfortunately, the sheeple become convinced to join hands with their oppressors time and time again. Voting is one obvious form of that. It’s Stockholm Syndrome on a global scale. Scary time to be alive amidst this sea of willful ignorance.

  • Wade House

    Brilliant Conclusion DB, and thoughtful article.

    I just think we can come up with a few more solutions than food, water and housing.

    If you know you are heading in the wrong direction, take a different route! 🙂

  • esqualido

    “Certainly it is possible that bankers will attempt some sort of jubilee as a way to support people as they restructure the world’s economy and further centralize it.”
    Don’t think for a minute that bankers have any plans for a debt jubilee for anyone but themselves; the obvious proof is shown in the plight of the debt saddled student, who unlike that other “person,” the [banking, for example] corporation, can not discharge his debt through bankruptcy. When the last Clinton was in office, in 1998, the law was revised to remove any timeframe for allowable discharges (it had gone from 5 to 7 years before.)

    • akaGaGa

      “the obvious proof is shown in the plight of the debt saddled student.”

      But Hillary understands! She wants to make college “free” for everybody!

      Long live Hillary!

  • rahrog

    Declare independence from the central governments that are owned by the central banks. SECEDE from the system that was created by evil to destroy mankind.

  • John

    US Presidential Election 2016 / Donald Trump. An inquiry regarding the future of America and the rest of humanity. Spread the link and Download this video and spread it around.
    https://www.youtube.com/watch?v=F5bwLkQY32E

    • colin

      The UBUNTU system proposed by Michael Tellinger and being implemented by him in a small part of South Africa would seem to be an ideal approach for the world although it is not easy to see how it will be achieved

  • No More Neos

    Here are the seven stages of wealth, which has been used for centuries to extract wealth from nations and concentrate power to a select few:

    1. Good Money –

    Every major empire starts out with good money, either gold or backed by gold.

    2. Social Programs –

    As a country develops economically/socially, it takes on more public works, adding layer upon layer

    3.Military Spending –

    As a nation’s affluence grows, so does it’s political influence and spends massively on the military

    4. Wars –

    Nation puts military to use and expenditures explode and nations go to war

    5. Fiat Currency –

    To fund the wars, the costliest of endeavors, nations start to steal wealth of its citizens by replacing their money with fiat currency (value decreed by government and backed by nothing).

    6. Inflation –

    Wealth transfer begins as hyperinflation sets in; Results in riots, eg. Egypt. Price of all commodities and goods go up.

    7. Wealth Transfer-

    Final stage, in mass movement, nation moves out of the currency and into precious metals and other tangible assets. The currency collapses. This results in massive wealth transfer to those who positioned themselves in the right asset class in advance.

    This cycle is predictable. This is what happened to the Roman Empire and every other empire. We are now headed back to the gold standard.

    Read more at http://investmentwatchblog.com/here-is-what-i-learned-from-a-millionaire-about-the-7-stages-economies-go-through-and-how-to-profit-like-the-ultra-rich-during-times-of-economic-chaos/#RDHvExZHD8oHeiD3.99

  • Danny B

    I’m back pounding my drum. While globalization caused a lot of unemployment in the West, that is nothing compared to the unemployment caused by automation. The employment picture crashed in the West when containerized shipping threw all of our manufacturing into global competition. Our earning and wage base shrunk BUT, the financial sector refused to shrink commensurately. The upper loop of the economy survived on continuous infusions of debt money. The lower loop, that depends on actual wages continued to shrink.
    This is all starting to catch up to the upper loop. We have falling wealth production that “they” try to compensate for with rising currency creation. Yes, it’s going to crash. NO, it will NOT result in globalization.
    The self-proclaimed elites can not engender trust and confidence worldwide. Every world leader will have to answer to HIS constituents when they are hungry. World trade will crash,,,as per Sr. Salinas Price.
    It will NOT be revived in some worldwide bastardised version of the Cloward-Piven strategy. You can not manufacture trust and confidence.

    The die was cast, not so much on Jekyll island as it was at Bretton Woods. THAT was the inception of the American hegemony as illustrated by Triffin.

    Our trade deficit is $ 1.5 billion per DAY. This is going to come to an end. Imports are going to stop. Our “exorbitant privilege” has financed the blowing up of most of the world. The R.O.W. is working in unison to bring this to an end. They have financed their own destruction.

    Armstrong’s prediction for 2015.75 came true on precisely that day. It’s ALL downhill from here. The West has hedged it’s paper with MORE paper. China has hedged it’s paper with GOLD. There will come a day when gold draws more confidence than paper.

    Globalization has created global capital flows and global-mean-wages AND global prices for raw materials and commodities. Russia has 11 time zones of raw materials. The high-cost producers in the West are TOAST. Pox Americana is winding down.

    The FED, ESF and PPT are pumping cash into every organism that threatens to default. They are working their way down the financial food chain as ever-more entities discover that they need customers to survive.

    Our system can NOT possibly survive a no-growth environment. “They” say that we need permanent ZIRP. Why not,,, that will bring permanent death to most of the economy;
    http://dollarcollapse.com/money-bubble/fire-economy-dying/
    There will be no revival. There will be no SDR. Armstrong’s model is a confidence model because confidence is all-important. “They” can manufacture desperation but, they can’t manufacture confidence.
    There will be no one-world currency. Greece shows us why not.

    • Bruce C.

      I agree with a lot of what you say. I think it will be especially prescient if Trump wins the US Presidency. If not, things may go totally opposite.

      It is already in the air, and Trump fuels it to varying degrees, that the current system and the people running it are “very stupid [and corrupt] people”. He points it out in almost every major policy decision for the last 30 years. Therefore, if things collapse most(?) people will not think it was “accidental” but the result of either incompetence or evil intent. Either way, people will not accept more stupid solutions by the same crowd. They will retract to more local, familiar, accountable, controllable levels. Trump is sort of an indicator of that trend/”movement”. If Trump doesn’t win it will mean too many people are drunk on the kool-aid and they will be fodder. And the irony will be that those of us who know/knew better will not be the crazy loons who will rise up in panic and be killed by their destroyers who they enabled.

  • Stephen Persaud

    China’s economic miracle is a “Paper Tiger”……..

    http://www.trunews.com/article/52.5-billion-launch-restructure-china-economy

  • Tim Leary

    With cryptocurrencies steadily developing into a solid financial platform where you can be your own bank, the usage of fiat money will necessarily shrink.
    Blockchain applications will further pave the way to global decentralized economy building on the invention of digital computer and the Internet.
    The value that is stored in digital tokens of the future economy has a lot of room for growth against the depreciating value of centrally issued money of the old economy.
    It is not apparent but the tokens can have an actual intrinsic value by allowing useful services to be built on the blockchain and in some cases completely replace the whole machinery of corporations currently providing them.
    Gold and silver serve as a solid base of true value tested over thousands of years and will complement and provide physical backing in the new era of free market money.

    • Carl McWilliams

      Hello Tim Leary: Perhaps DAILY BELL will expand upon your fascinating and profound posit with their wisdom and foresight?

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  • Marathon-Youth

    European Banks admitted to 1 trillion dollars in bad loans earlier in 2016.
    Then BREXIT happened. That removed the financial capital of the EU and the 5th largest economy in the world.
    Germany expects another 5 nations to leave the European Union. If that is true and the banks are in trouble then the Euro currency may become obsolete. That is a crisis.

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