“Whatever It Took”: A Look Back At The Mario Draghi Era And His Catastrophic Legacy


24-10-19 05:52:00,

Eight years after he took over from Jean-Claude Trichet, today Mario Draghi held his last Governing Council meeting before Christine Lagarde takes over on 1 November. Draghi leaves Europe in a recession, the ECB without ammo, a wealth divide unlike any seen since the Great Depression, and his successor facing an unprecedented revolt across the ECB’s governing counsel.

In short, his legacy is nothing short of catastrophic, although his advocates will quickly chime in: he managed to kick the can for 8 years. Well, he sure did, and in the process made the accumulated imbalances, and the coming crisis, that much worse.

* * *

During his 8 years in charge, the Euro Area eventually emerged from a period of sovereign debt crises and saw unemployment drop to 7.4%, its lowest since May 2008. However, inflation proved too stubborn to return to target (averaging 1.19% over the period), standing at just +0.8% in September, while five-year forward five-year inflation swaps standing at 1.202%, just shy of all time lows…

… so, as DB’s Jim Reid notes, “not exactly a vote of confidence from the markets that they expect the ECB to get inflation back up again anytime soon.”

Another remarkable achievement, or lack thereof, is that unlike Yellen or Powell, Draghi was never able to raise rates during his term, instead pumping ever-more liquidity into the financial system as he fought one crisis after another, while making the rich richer, resulting in Europe’s biggest wealth divide in history.

According to Bloomberg, Draghi will be remembered for his pledge to do “whatever it takes” to save the euro during the regional debt meltdown in 2012. Perhaps, but while Europe’s sovereign debt crisis is virtually assured to return, one thing that will never “normalize” is the ECB’s balance sheet, which in our view, is Draghi’s true lasting legacy. Under the Italian central banker, the ECB expanded moral hazard to an art form, setting a price guarantee not only for government bonds but also backstopping corporate debt. The result: the ECB balance sheet has hit level that can never be unwound without triggering a new crisis.

Seen in this light, in addition to “whatever it takes”,

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‘Whatever happened to suicide watch?’ Suspicion reigns as Epstein’s secrets die with him


10-08-19 06:07:00,

The death by apparent suicide of convicted pedophile Jeffrey Epstein shocked few pundits. Given his previous attempt on his own life and powerful connections, how could Epstein have been left alone to kill himself?

Epstein was found dead in his Manhattan jail cell on Saturday morning, with law enforcement sources telling multiple media outlets his death was a suicide. The 66-year-old millionaire had been held in custody since his arrest last month on charges of child sex trafficking and conspiracy.

Puzzlingly, Epstein had supposedly been placed on suicide watch since he was found “injured and in a fetal position” in the cell two weeks ago, after a suspected hanging attempt. “Logistically speaking how does a person hang himself in solitary confinement under suicide watch?”asked conservative commentator Matt Walsh.

I’m sorry but it’s extraordinarily fishy that a prisoner with this high of a profile, who had already allegedly attempted suicide before, was able to kill himself with success in a federal prison.

This is an enormous scandal that must be investigated. Was he helped? https://t.co/XjcMkkz4BL

— Emma Vigeland (@EmmaVigeland) August 10, 2019

So, suicide watch. That means a paper dress. Having no access to shoelaces. Monitored 24/7 (23 hours with a guard outside, everything else is on CCTV). How’s he fashion a noose for himself? Did they take him off suicide watch? Did a guard get paid to look the other way? Weird.

— Ian Miles Cheong (@stillgray) August 10, 2019

Adding to the conspiracy, one of Epstein’s alleged victims claimed to have been trafficked by the financier to a ‘who’s who’ of the world’s rich and powerful, including British Prince Andrew, billionaire investor Glenn Dublin, “another prince,” a “foreign president,” a “well-known prime minister,” and the owner of a French “large hotel chain.” The alleged victim’s testimony was unsealed on Friday, hours before Epstein’s suicide.

Even mainstream media talking heads and their followers saw conspiracy. Within an hour of the news breaking, “Clintons” and “#ClintonBodyCount” – referencing a decades-old conspiracy theory that Bill and Hillary Clinton are responsible for a string of suspicious suicides – were also trending on Twitter behind “Epstein.”

Authorities couldn’t keep Epstein alive by putting him under 24 hour surveillance?

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Whatever Happened to Peak Oil? | New Eastern Outlook


31-12-18 01:57:00,


Back during the early days of the Bush-Cheney administration, countless articles and even official statements by the International Energy Agency and various governments proclaimed the onset of what was termed Peak Oil. This was a time when former Halliburton CEO, Vice President Dick Cheney, was named to head the White House Energy Task Force. In the run up to the March 2003 war on Iraq, peak oil or absolute decline in world oil reserves seemed a plausible explanation, if not justification, for the G.W. Bush invasion of Iraq. This author was also for a time persuaded that could explain the oil war. Yet, today we hear little about peak oil. Why, is interesting.

Peak Oil was and is an invention of certain financial circles along with Big Oil to justify among other things ultra-high prices for their oil. The peak oil theory they promoted to justify the high prices, hearkened back to the 1950’s and an eccentric oil geologist with Shell Oil in Houston named King Hubbard.

Bell Curves and such

While working for Shell Oil in Texas, Marion King Hubbert, or King, as he preferred to be known, was asked to deliver a paper to the annual meeting of the American Petroleum Institute in 1956, an event that would become one of the most fateful examples of scientific fabrication in the modern era.

Hubbert posited all of his 1956 conclusions, including that the US would reach oil peak in 1970, on the unproven assumption that oil was a fossil fuel, a biological compound produced from dead dinosaur detritus, algae or other life forms originating some 500 million years back. Hubbert accepted the fossil theory without question, and made no evident attempts to scientifically validate such an essential and fundamental part of his argument. He merely asserted ‘fossil origins of oil’ as Gospel Truth and began to build a new ideology around it, a neo-Malthusian ideology of austerity in the face of looming oil scarcity. He claimed oil fields obeyed the Gaussian bell curve, itself an arbitrary heurism.

For the giant British and American oil companies and the major banks backing them, the myth of scarcity was necessary if they were to be able to control the availability and price of petroleum as the lifeline of the world economy.

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Whatever It Takes

Whatever It Takes

08-08-18 03:19:00,

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

At the end fiat money returns to its inner value – zero.”  – Voltaire

 “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.” – Mario Draghi July 26, 2012

On July 26, 2012, European Central Bank (ECB) President Mario Draghi essentially guaranteed the ECB would not allow the markets to cripple the Euro region. This shot across the bow finally remedied the instability caused by the sovereign debt crisis. The markets quickly reversed the damaging trends and uncertainty that had plagued the Euro-zone for months.

Draghi’s statement essentially boiled down to a promise that the ECB would print unlimited amounts of money to stop the “harmful” will of investors.

Fiat currency, be it dollars, euros, yen, or any other major currency today, are backed by confidence in the government, its ability to tax and the status of its economy. Importantly, however, it is also largely based on the trust and confidence in the central bank that issues those notes. If Draghi did not have the market’s trust and confidence, his statement would have been ignored, and there is no telling what might have happened to Greece or the Euro for that matter.

In September 2016, the Bank of Japan (BOJ) introduced Quantitative and Qualitative Easing (QQE) with Yield Curve Control. The new policy framework aimed to strengthen the effects of monetary easing by controlling short-term and long-term interest rates through market operations. The announcement also introduced an “inflation overshooting commitment” with the BOJ committed to expanding the monetary base until the year-over-year inflation rate “exceeds and remains above the 2 percent target in a stable manner.” Essentially, the BOJ pulled a “Draghi” and promised to do “whatever it takes” to ensure interest rates did not rise more than they wanted.

Recently, the BOJ amended the 2016 statement because bond investors were increasingly testing the central bank’s resolve. We are not claiming this just yet, but if the BOJ is losing the trust and confidence of investors, they could be the first domino in a long line that will change the markets drastically.

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