Alex Jones has made a splash with some letters to customers issued by Chase Bank, a too-big-to-fail monster bailed out by taxpayers. It says outbound telegraphic transfers will be banned coming up in a month or so. I've anticipated this, since having a Government involved in currency always leads to poverty, The failure rate on paper currency is 100%. The USDollar will be no different.
The limits on how much cash they will process, note they add both cash collected and cash distributed is being limited too. This is to force your customers to pay by electronic means, which will allow the powers that be to kick the can down the road, except that while it delays the inevitable, it means the crash will be exponentially worse.
Now this is not to say there will be no way to make int'l payments, it just means that we will go back forty years to letters of credit in int'l payments, so banks and the socialist states can control payment flows.
The problem with this is there are maybe fifty people left on planet earth, like me, who understand that letters of credit are not security, just a mechanism. When a million bankers re-introduce letters of credit for business, there will be astonishing losses as the sheep are eaten by the wolves.
At the same time, currency fluctuations are hammering Chinese exporters.
Feel free to forward this by email to three of your friends.
The limits on how much cash they will process, note they add both cash collected and cash distributed is being limited too. This is to force your customers to pay by electronic means, which will allow the powers that be to kick the can down the road, except that while it delays the inevitable, it means the crash will be exponentially worse.
Now this is not to say there will be no way to make int'l payments, it just means that we will go back forty years to letters of credit in int'l payments, so banks and the socialist states can control payment flows.
The problem with this is there are maybe fifty people left on planet earth, like me, who understand that letters of credit are not security, just a mechanism. When a million bankers re-introduce letters of credit for business, there will be astonishing losses as the sheep are eaten by the wolves.
At the same time, currency fluctuations are hammering Chinese exporters.
Besides the rising value of the currency, increased production costs and possible adjustments to foreign trade policies in the near future also hampered domestic exporters from clinching long-term orders with overseas buyers, Liu said.One report suggested the Chinese should require payment in RMBY. Just like the good old days under Mao.
"But the key factor is the rising value of the renminbi, which, as far as most Chinese exporters are concerned, will lower their profits in the future," Liu said.
Feel free to forward this by email to three of your friends.
2 comments:
Hi John, from above: "letters of credit are not security, just a mechanism"
If I'm understanding this correctly, there really is nothing to stop either party from reneging on the purchase agreement?, but since we are dealing with known, established suppliers/manufacturers, breaking an agreement should be very rare? We are primarily relying on reputation and established relationships for everyone to fulfill their side of the agreement?
But letters of credit do give us credibility and assurance when dealing with everybody in our "web" (designers, manufacturers, sales reps, retailers, etc.)? Letters of credit are sufficient in getting things done and making deals go forward, without any cash from exchanging hands (at least initially)?
In 80% of the time, letters of credit fail for some technical reason, a rather untenable reliability rate. But you have it exactly right, when the LC fails, we proceed anyway (taking the bank off the hook) because the deal is based on relationship, not security in an LC.
The LC was once a voluntary method, but when the state arrogated the crime of usury unto itself, made possible by the nonfeasance of Churchmen, the Letter of Credit morphed from a voluntary event of benefit to all parties into its present abusive system.
With the letter of credit "cash" does change hands before anything happens, when the buyer opens the letter of credit.
What gives you credibility is the quality of your work, not a letter of credit. The letter of credit merely signals that you CAN pay, not that payment will be effected.
But note the words, credibility, credit. Our entire system is built on a ponzi scheme where fiat (faith) currency is built on the credibility that our overlords can mulct enough from its victims to make the usury payments to the lenders (in this case largely the Chinese.)
None benefitting from this system wants to see it fail. Those who do not benefit are not aware they are the victim. It is a very sweet system, for the beneficiaries. going back to LsC to control currency flows will prolong the system.
What do they say? If you have not figured out who the mark is within 2 minutes of joining the poker game, it is you.
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