US economy in shambles, Long term financial committments like Medicare, Medicaid, Social Security in doldrums & the devaluation/replacement of the US $ is the next step ?.



http://economictimes.indiatimes.com/India-reluctant-to-join-de-dollarisation-chorus/articleshow/4659464.cms


India reluctant to join de-dollarisation chorus at BRIC

15 Jun 2009, 2038 hrs IST, AGENCIES

NEW DELHI: While China and Russia are likely to pitch for the induction of a new global currency to replace the dollar as the world's main reserve
(de-dollarisation) at the first BRIC summit beginning tomorrow in Yekaterinburg, it is most unlikely that India will join the chorus on this issue, according to government sources.

Although India has found congruence in the agenda of other BRIC nations on key international issues like the longstanding demand for restructuring and democratization of international institutions like IMF and the World Bank, tackling terrorism, climate change, it so far distanced itself from challenging the supremacy of dollar and is in favor of increasing SDRs' (Special Drawing Rights), which is the IMF's indigenous currency.

In the face of a deepening economic crisis and the balance of economic power tilting from west to east, Beijing and Moscow are concertedly canvassing for the induction of new currency in the international system . The issue of currency replacement was also raised by Beijing during the G-20 London summit in April this year, but could not find many takers.

Currently the dollar represents about 65 percent of foreign exchange reserves and both Russia and China have parked huge funds in the US treasury and invested heavily in the US treasury bonds, which is widely used by the administration for bailing out domestic industry .

According to sources this is the main reason why both Russia and China are ranting for a neutral currency .

According to the most recent U.S. Treasury Department data Russia holds about 30 percent of its 404.2 billion dollars foreign exchange reserves in treasuries, making it the fifth-largest holder of U.S. government debt.

China, the world's largest holder of U.S. Treasuries, has 767.9 billion dollars. India has not invested so heavily in the treasury bonds, and therefore, it does not have a reason to worry according to a source .

Authoritative sources in the government see this issue as more of an ideological one than a substantive one and, officials on condition of anonymity, say that New Delhi would not like to upset Washington by challenging the dollar supremacy at the BRIC summit, especially at a time when the US is pressurizing Pakistan to nail down terrorism and US Secretary of State Hillary Clinton is about to make her maiden visit to India.

Foreign Secretary Shivshankar Menon has already set the record straight by saying that there will be no America bashing at BRIC and this group of four fastest emerging economies is not directed against anyone.

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Sunny Leone a true Canadian DESI now back in India !.

I like Obama, his communication style, clarity of thought and also for frankly admitting what is wrong with US of A.


But............................................................


1.He is still not moved from Campaigning to Governing.

2.Iranian election is slap on his face.

3.North Korea's rebellion, subsequent nuclear testing & air missle launches again weakens his foreign affair handling capability.

4.The same guys who made money by causing the biggest financial crash in US and subsequently globally are fixing the system under him. It starts right with Timothy Geithner.

5.He has started with Health Care reforms and he is going to run into lots of opposition.

In a recent NBC special where the NBC news anchor Williams had spent considerable time in the White House and Obama himself made a remark maybe in the next 4 or 8 years, meaning that he himself is not sure if he will be re-elected in 4 years to come.

Offlate if you see his responses you'll find that he has come to get a real handle on the seriouseness of the problem that US is in, he seems to be taken an attitude of a Night Watchman than an opener.

Good Luck Obama for your effort, may be the task is too big for one term/one president !.

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Sunny Leone a true Canadian DESI now back in India !.

Future of USA, Wall Street and other related economic issues.

http://www.cnn.com/video/#/video/us/2009/06/07/gps.michael.lewis.int.cnn?iref=videosearch

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Sunny Leone a true Canadian DESI now back in India !.

Pakistan is flooding India with duplicate(Nakli) Indian Money.


Sivakasi & Coimbatore are towns in South India very famous for printing FAKE money.

Now this:

http://www.expressbuzz.com/edition/story.aspx?Title=The+$134.5+billion+mystery&artid=bSuI0|Fzeo0=&SectionID=d16Fdk4iJhE=&MainSectionID=HuSUEmcGnyc=&SectionName=aVlZZy44Xq0bJKAA84nwcg==&SEO=

The $134.5 billion mystery


S GurumurthyFirst Published : 20 Jun 2009 01:10:00 AM ISTLast Updated : 20 Jun 2009 01:11:40 AM IST

The amount is $ 134.5 billion. Many may not have an idea as to what this number adds up to. In Indian currency terms today, of course, it is Rs 6,44,000 crore. But this equals the cash value of the GDP of the bottom 49 countries of the world. The annual income of the entire people of these 49 countries adds up to $134.5 billion. What is the significance of this $134.5 billion? This was the value of US treasury securities which two persons had attempted to smuggle into Switzerland from Italy. It happened on June 3. The persons who attempted this daring act were two Japanese in their 50s. An Italian newspaper reported it on June 10; other media began following it up and kept reporting. But surprisingly none of the mainline newspapers anywhere in the world, except the online Bloomberg, even reported it.


The substance of the report was this. On June 3, the Italian finance police detained two Japanese nationals who tried to enter Switzerland with US Treasury bonds of the value of $134.5 billion. They were caught at Como, which is 50 km from Milano in Italy. They were caught in Chiasso’s train station after an inspection. The two men had hidden US treasury bonds in a suitcase with a false bottom. There were 249 bonds of the face value of $500 millions each amounting to $124.5 billion and another 10 bonds titled ‘Kennedy’ bonds of the face value of $1 billion each, that is $10 billion in all, making it a total of $134.5 billion. The Japanese consul in Milan in Italy confirmed that the detention had taken place; it was trying to confirm with the Italian authorities whether they were Japanese nationals and their identities. The media reported that the Italian police had asked the US Securities Exchange Commission to confirm whether the securities were genuine or not. Financial experts in Italy had already expressed the view that such high denomination securities could not have been issued by the US Treasury in 1934 which was the date appearing according to reports on the 249 bonds valued at $124.5 billion. Also no ‘Kennedy’ bonds ever existed, according to them. A few days later, on June 18, a spokesman of the US Treasury told the media that the bonds seized were fake ones; the US had never issued individual bonds of high value at all. So the US has officially declared the bonds which were being smuggled into Switzerland are fake. But this raises more questions than it answers. Yet none of the mainline media would touch this mysterious subject despite its high and exciting news value.

If the bonds seized by Italian police were fake, it would suggest, as William Pesek, columnist at Bloomberg says, that at the minimum the US risks control over its monetary supplies on a massive scale. There have been reports for long that the US dollars in the denomination of 100s were being counterfeited all over the world. But this is the first time that counterfeiting of US Treasury securities has been found. This report comes at a time when the US economy is going through its worst phase since the Great Depression. As a commentator said, in Asia the fear of counterfeit treasury security makes the genuine ones suspect in the minds of the investors. How will new investors put in their money in US treasury securities if there is no guarantee that the bonds which circulate in the name of the US government are genuine? The commentator further points out that while circulating perfectly counterfeited enemy currency was resorted to by rival governments during the World War II, the Bank of Italy went a step further and issued its very same security twice over with duplicate numbers to conceal the extent of public debt. Could the US government have done something similar? Raising this shocking question and answering it Karl Denninger in his blog titled Market Ticker wonders ‘if the US treasury has been surreptitiously issuing bonds to, say, Japan as means of financing deficits that someone didn’t want reported for the last 10, 20 years’. That the Bloomberg columnist cites Denninger’s comments shows the extent of desperation in the financial world for an explanation for what has happened at Como.

If one looks at the pattern of holding of the US Treasury Securities, even though the US Treasury asserts that it has stopped issuing bearer securities, it has issued its securities to tax haven entities. Tax haven means that the identity of the ultimate owner is opaque. Out of the total of some 3,262 billion worth treasury securities held by foreign governments and banks as of April 2009, the amount of securities held by what the US treasury says as ‘Caribbean banking sector’ is mentioned as 205 billion and that includes Bahamas, Bermuda, Cayman Islands, Netherlands Antilles, Panama and from June 2006 British Virgin Islands. In none of these tax shelters the name of the real investor is ascertainable. Even the British investments into US Treasury takes place through the Isle of Man, the British tax haven. The US government has admitted that it has allowed address-less money, that is black money, into the Treasury bonds. The world of finance has nicknamed this as ‘funny money’. Is the $134.5 billion funny money then?

It is all mysterious. Denninger says, “Let’s hope we get those answer and this isn’t one of those funny things that just disappears into the night”. The Bloomberg columnist says “the US Treasury must go to the bottom of this tale and get the markets informed”. But will that happen? Will the truth come out and will the market ever get informed? Otherwise like many mysteries, this $134.5 billion will remain an unresolved mystery. But this is far too serious a matter to remain mysterious particularly given the depth of the financial crisis the US and thanks to the US the world is in.

QED: If the $134.5 billion bonds were genuine Italy will get 40 per cent of it — that is some $54 billion — as fine from the smugglers. That would solve all its financial problems; its external and public debt will be off its balance sheet.

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Sunny Leone a true Canadian DESI now back in India !.