Another Presentation on What The Federal Reserve Is and How It Came to Be

Submitted by: Francis Soyer 5/18/11

Lets review! After talking with some friends and colleagues some of whom work as professionals in the Financial Services industry specifically Investment Management it is clear to me that some are still confused about what the Federal Reserve Bank is, it's purpose and how it came to be. Rather than waste your time and mine in that I am not a teacher by profession here is a video lecture from a man named Michael Badnarik who explains things much more elegantly and to the point than I can.

World Bank sees end to dollar’s hegemony

By James Politi in Washington Financial Times

Published: May 17 2011 18:41 | Last updated: May 17 2011 18:41

The World Bank expects the US dollar to lose its solitary dominance in the global economy by 2025, as the euro and the renminbi establish themselves on an equal footing in a new “multi-currency” monetary system.

The shift will be driven by the increasing power and strength of emerging market economies, with six countries – Brazil, China, India, Indonesia, Russia and South Korea – accounting for more than half of global growth in 14 years.

According to the World Bank report – released on Tuesday – emerging economies will grow at a rate of 4.7 per cent between now and 2025, a much faster pace than advanced economies which are expected to grow by 2.3 per cent over the same time-frame.
“The balance of global growth and investment will shift to developing or emerging economies,” said Mansoor Dailami, the lead author of the report.

The implications are wide-ranging. For instance, Mr Dailami said this power shift would lead to big boosts in investment flows to the countries driving global growth, with a significant increase in cross-border mergers and acquisitions activity, and a changing corporate landscape in which “you’re not going to see the dominance of established multinationals”.

In addition, a different international monetary system will gradually evolve, wiping out the US dollar’s position as the world’s main reserve currency.

“The current predominance of the US dollar would end sometime before 2025 and would be replaced by a monetary system in which the dollar, the euro and the renminbi would each serve as full-fledge international currencies,” the report said, highlighting what it considered the “most likely” of three scenarios for the currency markets in 15 years.

The report identified the euro as the most “credible” rival to the US dollar, with one caveat. “Its status is poised to expand, provided the euro can successfully overcome the sovereign debt crises currently faced by several of its member countries and can avoid the moral hazard problems associated with bail-outs of countries within the European Union,” the report said.

On China, the report noted that authorities there had already started “internationalising” the renminbi by developing an offshore market in the currency and encouraging the use of the renminbi in settling and invoicing international trade transactions.

“A larger role for the renminbi would help resolve the disparity between China’s great economic strength on the global stage and its heavy reliance on foreign currencies,” the report said.
The scenario presented by the World Bank means that financial institutions will have to “adapt fast to keep up,” said Justin Yifu Lin, the group’s chief economist.

Ex-Sen. Feingold says Lieberman, McCaskill, Hoyer fit for 'shame'

Ex-Sen. Feingold says Lieberman, McCaskill, Hoyer fit for 'shame'


By Michael O'Brien - 05/17/11 12:03 PM ET


Former Sen. Russ Feingold (D-Wis.) has tabbed two Democrats and Independent Sen. Joe Lieberman (Conn.) as fit for "shame" for being too beholden to corporate interests.


Feingold, the former liberal senator who leads a new PAC called Progressives United, singled out House Minority Whip Steny Hoyer (D-Md.), Sen. Claire McCaskill (D-Mo.) and Lieberman (Conn.), an independent who caucuses with Democrats, for a close relationship with corporations.


"This culture of corporate influence and corruption is precisely what we at Progressives United want to change. So we've decided to take on those legislators who are unwilling to stand up to corporate power, and we're naming names," Feingold wrote in an email, asking for $5 donations to "shame" those lawmakers with online ads.

1 Kilo Gold Futures Start Trading On Hong Kong Merc

1 Kilo Gold Futures Start Trading On Hong Kong Merc


Submitted by Tyler Durden on 05/17/2011 20:48 -0400
Hong KongPrecious Metals


As of 8 pm Eastern, the Comex' monopoly to the precious metals futures is over. As we reported previously, today, at 8 am local time, is when the Hong Kong Mercantile exchange would start trading the inaugural Asian precious metal futures contract: the 32 ounce /1 kilo/ gold futures. In the first 30 minutes of trading it appears to have been a subdued session, with just 22 contracts changing hands in the August 2011-June 2012 frame. How this trading will impact prices: nobody knows (yet). The spot price of gold has barely budged in the past hour. That said, now that PM futures fragmentation is starting, we expect that within 2 years we will have various deranged HFT algos trading tonnes of gold, quote stuffing globally, and otherwise creating one of the most volatile trading environments imaginable.

And since we know you are asking: the margin schedule for the HKMerx will be kept and listed by the same LCH.Clearnet that hikes and lowers Irish and Portuguese bond margins by 10% on an almost weekly basis. Let see now how the Comex hikes its gold margins with impunity if it has competition that keeps margins "artificially" low, and provides disgruntled Comex clients with an alternative venue that accepts far less cash collateral to trade.

It's called competition Chicago: get used to it.