Skip to main content

Why a new market crash will be profitable for the oligarchy

Despite all the warnings of a new market crash, no government, bank, or, international organization, are taking effective measures to deal with it. The excuse is that the international financial system has become so complex that no one knows how to avoid a new crisis.

globinfo freexchange

But several recent developments in the markets and contradictory advice and statements by experts, can be explained only if some try to profit from a collapse of the markets, and are betting in a giant "shorting".

When markets go up, the result is accumulated profits due to the increased value of the shares and other financial products. But investors can bet also on the fall of the markets and values of the shares, through the so-called shorting.

In simple words, the shorting works as follows: an investor borrows shares from a broker, betting that the price will fall. After the shares are sold, the investor's account is credited accordingly. After a period of time, the investor must return the borrowed shares to the broker. If the price has dropped in the meantime, the investor will make a profit proportional to the fall in equity prices. How is done? “It's the virtual economy, stupid!”

The profitable side of a crash

In today's capitalism, even a crash of the markets could bring profit. First, the coverage of losses through public funds is a given fact. The losses of most banks in 2008 were covered by state funds. Something similar is done for every non-negligible falling of the markets through "quantitative easing" and similar interventions. The ECB, the Bank of England, the US Federal Reserve, or, the People's Bank of China, are throwing huge sums in the corresponding markets to buy stocks and bonds, for the purpose of recovering the stock markets.

The big banks and large investment institutions are well aware of what to do when they will come across a new market crash: they will resort again to the central bank of the state, which will support them again, with the excuse that they are «too big to fail ", as in 2008.

Second, the large-investors know how to steer the markets, how to bet on a new crisis, and how to take advantage. Therefore, it should not be surprising that the warnings about the upcoming crash, come not only from "well-meaning" analysts who worry about the economy, but also by large-investors. No one would expect by them to proclaim that a new crisis comes.

Even if a crash is inevitable because of the bubble in the international economy, the timing and the manner through which it will occur can be affected by targeted interventions in the markets. The amounts needed for such a shorting of the the market are huge. The hedge funds, which have at their disposal a total of more than 2 trillion dollars are holding a leading position among the usual suspects for interventions of this magnitude.

Controversial actions and statements

Several recent developments indicate that something is "cooked" in the markets. During the first week of January, some hedge funds and companies, through only one US bank, made the largest investment in the US since 2010, through shares of total value of 3 billion dollars.

In August, the Chinese government banned the shorting and the operation of certain hedge funds in the markets of China. Of course, the Chinese plutocrats who gained about one trillion dollars from China in 2015, shorted the Chinese market indirectly. This money was not invested in other markets, but in deposits and luxury properties in London and the US.

In January, international banks warned investors to sell everything because a crash is coming. But these warnings serve those who intend to buy the "sold out" shares cheaply, waiting for a temporary recovery in the stock markets, in order to "short" the market and receive the earnings later, as soon as the crash happens.

The various Croesus of the international economy, urged the investors at this year's Forum in Davos not to invest their money. They also urged central banks not to intervene in the economy. But they didn't explain, why the last eight years did not complain at all about the interventions of central banks from which they got richer, and why now, they believe that the markets will recover without new investments and state interventions.

The objectives of the deliberate confusion

In 2008, the experts were seeing the bubble, did nothing to prevent the crisis and came out winners. In 2016, they seem to be better prepared. They spread confusion deliberately, to gain even more from the next crisis.

A peculiar war of impressions has already begun. For example, the big investor George Soros is stating that he bets on the decline of Asian currencies, and the Chinese Government responds that any movement against the Chinese currency will fail.

A more likely target for shorting is Eurozone, as the euro, with the complexities of the refugee issue and the Brexit, is becoming increasingly an easy prey. Whatever the goal, there must be first a non-negligible rise of the markets, on which to build a shorting and the subsequent fall.

When such a rise will be observed with the subsequent fall of the markets, should not be seemed strange the fact that behind the pin that will prick the bubble of the global economy, lies a giant shorting.

Article by Michalis Gianneskis, translated from the original source : tvxs.gr

Read also:


Comments

Popular posts from this blog

WikiLeaks paper reveals Congressional think tank specific techniques for 'persuading' audiences

This document was obtained by WikiLeaks from the United States Congressional Research Service. The CRS is a Congressional "think tank" with a staff of around 700. Reports are commissioned by members of Congress on topics relevant to current political events. Despite CRS costs to the tax payer of over $100M a year, its electronic archives are, as a matter of policy, not made available to the public. Individual members of Congress will release specific CRS reports if they believe it to assist them politically, but CRS archives as a whole are firewalled from public access. This report was obtained by WikiLeaks staff from CRS computers accessible only from Congressional offices.
globinfo freexchange
A report from April 12, 2007, was "Prepared primarily for congressional staff members called upon to help prepare speeches for Members,” and “provides basic guidance on obtaining speech material, using it to prepare a speech draft, and presentation.”, as we read in the abstract. …

Mystery solved: here's why the Western mainstream media suddenly 'discovered' the war in Yemen

globinfo freexchange
Why it took so long for the Western mainstream media to 'discover' the war in Yemen and the war crimes committed by the Saudi coalition in full co-operation with the US?
One might think that the humanitarian disaster there - caused also by the blockade of goods for the relief of the civilians - has become so obvious, condemned multiple times by the UN, that the media finally forced to speak about it.
In previous article we attempted to explain the 'unexplained phenomenon' and the fact that CNN surprisingly returned to the issue to openly condemn the US support to the Saudi coalition atrocities against civilians in Yemen.
Yet, despite that the Saudi regimes have been, traditionally, the best allies of the Western neocolonialists, this time, the US had serious reasons to overthrow the Saudi crown prince Mohammed bin Salman (MBS). And, surprisingly enough, at the center of this underground conflict lies an attempt by the US to privatize Aramco, Saudi Arab…

Recent US elections confirmed that progressives will have to fight two monsters at once: Donald Trump and corporate Democrats

failed evolution
Nancy Pelosi's speech after Democrats took the House in recent US elections was not just a huge disappointment. Many progressives became furious about her empty speech, which was full of the most obsolete political generalities and cliches.
But it was not just that Pelosi didn't want to committ that Democrats will fight for specific issues - in favor of the vast majority of Americans - that returned in the political debate by Bernie Sanders and the progressive movement.
She actually 'gave the finger' to the progressives straight and clear.
If you don't believe it, just check her own words: “... we will strive for bipartisanship. [...] we have a bipartisan marketplace of ideas that makes our democracy strong ...
Translation: ‘We will do business as usual. The bipartisan dictatorship will remain strong and under the control of the plutocratic elite. Nothing will change, don't bother.
That's all you need to know.
Here is another evidence that the c…

The Snowden files: NSA's plans for a hundred percent coverage of every square inch of the planet

NSA wants to take its battlefield targeting alert system that they used to kill people in Iraq and in other war zones and implement it globally, so that they can target anybody anywhere.
globinfo freexchange
Suzie Dawson, asylum-seeking journalist and current President of the Internet Party of New Zealand, is being targeted by New Zealand intelligence agencies as a result of her activism in the Occupy movement and against the TPP, among other causes.
Dawson spoke with Jimmy Dore and made some astonishing revelations coming from Edward Snowden that were very little known. Here are the most impressive:
According to the NSA, it takes a whole village for them to spy on the UN. That's a direct quote they worked with the State Department and the CIA to spy on and monitor and infiltrate the United Nations.
The NSA was literally planning a system of global control. They refer to it in their documents as the global network and they want that spying network to cover the entire globe. They actua…

The establishment apparatus fabricates another poll to 'adjust' popular preference in favor of Joe Biden, against Bernie Sanders

globinfo freexchange
In late August, we identified an effort by Politico (rather sloppy), to present Joe Biden as the most suitable leader for the Democratic party, based on the fact that he could beat Donald Trump.
The sloppiness of the effort was proved by the way in which Biden was promoted against Bernie Sanders, despite that the latest was beating Trump with the same percentage, according to Politico's poll.
It was CNN that came now with another poll to contribute to this pro-Biden operation and actually verify the title of our article back then. That is, corporate Democrats will promote Joe Biden against Bernie Sanders. Indeed, as usatoday reports:
           Former Vice President Joe Biden holds a wide lead over the other potential candidates to challenge President Donald Trump in 2020, a CNN survey found. About a third of respondents named Biden as their choice to carry the Democratic banner in the next presidential election (33 percent), while Vermont Sen. Bernie Sanders cam…

Liberal plutocrats preparing ground to wipe out progressives and directly take over the Democratic party in US

globinfo freexchange
Through his own humorous style, comedian Lee Camp pointed out something quite serious. As he explained, Facebook's founder and CEO, Mark Zuckerberg, fulfilled all the conditions necessary to run for president of the United States.
One key condition is certain and obvious: tons of money.
Another one, is to pretend to be religious. And this condition is, of course, particularly important in the America of Donald Trump. Indeed, as Camp says, the former Atheist Mark Zuckerberg has suddenly found religion.
And the most recent fulfilled condition by Facebook's boss, was to secure the alliance with the US deep state.
Indeed, on October 11, Facebook announced the removal of 559 pages and 251 accounts from its service, accusing the account holders of “spam and coordinated inauthentic behavior.” The primary thread connecting victims of the purge seems to be that they are critics and/or opponents of the American political “mainstream” or “establishment.”
Also, as Ben Nort…

George Soros tried to get rid of Yanis Varoufakis because the neoliberal regime could not handle Greece and Ukraine simultaneously

globinfo freexchange
In a recent interview at the Greek channel, Crete TV, the former Greek Minister of Finance, Yanis Varoufakis, made some interesting revelations. Among other things, he actually confirmed what the blog thought until now to be an exaggerated far-right conspiracy theory. He essentially confirmed that George Soros intervenes directly to political leaderships, substituting political institutions in Europe and elsewhere.
Varoufakis said that, on June, 2015, George Soros tried to contact Alexis Tsipras via his own ‘channels’. In the interview, Varoufakis claims that he had no idea what Soros wanted to talk about.
As Varoufakis also writes in his book Adults in the Room: My Battle with Europe's Deep Establishment, for years he has been falsely portrayed by the pro-troika establishment and the anti-Semitic Right as Soros’s stooge in Greece.
Yet, Soros’s message to the Greek prime minister, Alexis Tsipras, came as a perverse vindication. ‘Fire Varoufakis! Europe cannot affo…

Major cheerleader of the Iraq war says entire Arab world is completely dysfunctional!

globinfo freexchange
           I got news for you. The entire Arab world is dysfunctional right now. Completely dysfunctional. And I think it has the potential to be a giant Yemen. A giant human disaster area.
Guess who said that, and most importantly, why he said it:

For a moment we thought that a miracle was about to happen. We thought that Thomas Friedman would become one of the few exceptions that would declare regret for supporting the Iraq war, in a self-criticism short 'crisis'. You know, the war that was based on big lies and opened Pandora's box for the Middle East chaos. But no. It was too good to be true.
As Ben Norton of the Real News explains:
For the past two years, many leading pundits have been portraying Mohammed bin Salman (MBS) as essentially the savior of the Middle East, if not of the world. Thomas Friedman is probably the most egregious example. But Thomas Friedman is a powerful New York Times columnist, a so-called expert on the Middle East. And he, of c…

New poll gives evidence that the establishment upgrades the identity-politics weapon to crush Bernie Sanders and his progressive movement

globinfo freexchange
Another suspicious poll came out to promote various establishment options against Bernie Sanders. As the Hill reports:
President Trump trails Michelle Obama, Oprah and Sen. Kamala Harris (D-Calif.) by double digits in potential 2020 presidential races, according to a new poll.
Trump also trails several other female candidates in potential races, although by slimmer margins, the Axios poll conducted by SurveyMonkey found.
The poll shows Trump trailing by 13 points to Obama among registered voters polled, by 12 points to Oprah and by 10 points to Harris. He's also down by 9 point to Sen. Amy Klobuchar (D-Minn.) among registered voters surveyed, by 6 points to Sen. Kirsten Gillibrand (D-N.Y.) and by 5 points to his 2016 opponent, Hillary Clinton.
The closest race would be between Trump and Sen. Elizabeth Warren (D-Mass.), the poll found. Warren has a 2-point lead among registered voters, according to the poll.
The poll includ…

The real reason the knives are out for Mohammed bin Salman

In the six weeks before Khashoggi’s disappearance, MBS not only managed to anger the U.S. military-industrial complex but the world’s most powerful bankers.
by Whitney Webb
Part 4 - Trouble in neoliberal paradise
While it is impossible to know MBS’ exact reason for getting cold feet in his once-ambitious plans to privatize the kingdom, we can guess. Indeed, there is a reason that MBS’ elders in the Saudi Royal family have long rejected neoliberal reforms and the mass privatization of their economy.
A 2016 report from Foreign Policy succinctly states why past Saudi Royals have avoided “free-market reforms” as the older generations of the House of Saud “understand the fragility of a monarchy whose brittle pillars rest on the quiescence of conservative clerics and a merchant class hostile to the free-market reforms that will undercut their privileges.” However, far more Saudis than just the “merchant class” have grown accustomed to the largesse of the Saudi state, as the majority of Saudi c…