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By Rishi Teckchandani
In the last week we have witnesssed one of the biggest Federal Reserve interventions in US economic history. The intervention resembles how drought areas are positively charged when flood gates are opened. Last weeks action flushed the economic system with almost unlimited dollars to be borrowed through the discount window. At any costs the Federal Reserves motive was to prevent a 24 hour liquidity crisis from spreading. It administered the bail-out or in my opinion robbery of one of the oldest Wall Street Investment Banks "Bear Sterns" through its strongly capitalised relationship with JP Morgan. The deal itself was a one-of-a-kind in wall street. Nevertheless it sent panic across wall street faster then a lightning. This was more deadly then a contagious flu for the financial system. I personally feel this action was the only solution. Unfortunetly the action has its ultimate defects. And it looks like a strategy to prevent a dying economic system from collapsing anytime soon. For now the move looks like a short term aid for the highly levered investment banks and could potentially add more damage in the long run. Today the savior or last resort bailer of the US economy is in action. The reason for its actions was simply due to the lack of foreign participation in bailing out the US paper due to already being burned over the last few months. Nobody really has confidence anymore and the Feds have to boast their muscles.
For Proutists, this is very good news. It signifies that we are close to a major economic change. Because in my opinion, the pyschology of investors, consumers, governments and other beings besides traders have not changed. Its not easy to see your house in foreclosure then the stock market rally to 20,000 or as an investors to lose out on Bear Sterns then see JP Morgan shares rise. Or as a foriegn government to stabilise your own inflation when the US is reducing rates and igniting inflation. Traders are the only people enjoying this cosmic drama as it unfolds. The good news for PROUT is that beyond today's intervention there is really no other capitalist-free market protector out there. This weeks action will lead to a long term decline in the US dollar and what used to be a safe haven currency is now looking like ordinary plain white paper. For intelligent persons, they will analyse this situation and bail out on the currency instantly. And whilst countries in South America like Brazil used to be a "gamble" in the past, its looking more like a safe haven investment. Take a look at the US dollar Vs. the Brazilian Real over the last 5 years. This pattern will continue. I don't think there is anymore interest in investing in the US for a long term. The truth is why buy something for 10 cents on the dollar when you can probably get it for 1 cent on the converted dollar in a few years assuming a Zimbawe style inflation. Which I sometimes wonder why it hasn't happened yet? But its coming. The law of Karma will prevail in this situation. I don't see anymore cowardly leaders in emerging countries. India's finance minister is not concerned to a great extent about the sub-prime crisis, neither is Brazil, Hong Kong or Dubai. Even HSBC has closed its US operations and is focusing on international growth markets. The truth is capitalism has bailed its motherland. Investment bankers prefer to work for soveriegn funds in the middle east that pay twice as much in a safer currency.
I really feel the the US will one day look at PROUT as a savior and implement it first because the rest of the world is engaged in positive relations with each other as there economies face a short term difficulty from a US crisis. And domestically, the US faces a long term crisis from a short term resolution. Its painfull to see but I'm not convinced that the problem will be solved. One day the Chinese Yuan will infact trade $1 for 1 Yuan but slowly. They haven't re-valued at the pace the US is pressuring them to do so. But they are doing it slowly. I respect that move because China is not interested in killing its economy and will not obey orders. They rather ignore a crying mature economy from its woes focusing on its own growth and stability. Locking natural resource assets for its own future benefit. They learned the capitilist game very well and are now utilising it against its teachers. Similarly, the US stock markets are being abused by short specialist Hedge Funds creating an unfair investing environment. But this was the same abuse Asia had in its Financial Crisis, Russia had in 1998 and South America. The only difference today is the US markets are being treated as a trade. Its pure Karma.
As for the timing of PROUT, I will leave that to natures force (Prakriti) but it is coming soon. The revolution will come from the ground level. How much longer can we all suffer for? When gas prices hit $8 a gallon? or a Banana costs $11? Give it some time. Its coming. This week a well reputable wall street firm (Goldman Sachs) initiated a $200 target for Oil. Dick Cheney spent time in Saudi Arabia pressing for Oil output increases. Refiners are facing problems dometically with the crack spread! Its really a fact that the cartels are broken. There is no more control and markets will realise that. People must act now before prices reach a point that capitalists ruin the economy for the basis of there system's existence. They are too proud of their system. This pride is falling and will collapse faster then Bear Sterns did in one weekend. How much blood can a human body absorb? The Feds are injecting too much money into this system.
This is my last piece for now. I am moving with the flow towards the middle east region to work for a better empire. An empire that is beginning to respect economic growth and prosperity without losing its culture. And in time its culture will also improve when the ideology of humanity becomes Love All, Serve All, Help Ever and Hurt Never. People must realise we are from the same family and seek the same universal goal. Just like Capitalism is leaving America, I am also leaving. For the time being I see it working in the middle east but over a long duration of time even they will absorb a better economic system if the US is the first to accept PROUT. America can still set an example and be a leader. But it must act otherwise my opinions may become a fact.