strategic-culture | For decades, we were led to believe that the world-system put in
place after WWII provided the U.S. with unrivalled structural power.
Now, all that’s left is structural fragility, grotesque inequalities,
unpayable Himalayas of debt, and a rolling crisis.
No one is fooled anymore by the Fed’s magic quantitative easing
powers, or the acronym salad – TALF, ESF, SPV – built into the Fed/U.S.
Treasury exclusive obsession with big banks, corporations and the
Goddess of the Market, to the detriment of the average American.
It was only a few months ago that a serious discussion evolved around
the $2.5 quadrillion derivatives market imploding and collapsing the
global economy, based on the price of oil skyrocketing, in case the
Strait of Hormuz – for whatever reason – was shut down.
Now it’s about Great Depression 2.0: the whole system crashing as a
result of the shutdown of the global economy. The questions are
absolutely legitimate: is the political and social cataclysm of the
global economic crisis arguably a larger catastrophe than Covid-19
itself? And will it provide an opportunity to end neoliberalism and
usher in a more equitable system, or something even worse?
Wall Street, of course, lives in an alternative universe. In a
nutshell, Wall Street turned the Fed into a hedge fund. The Fed is going
to own at least two thirds of all U.S. Treasury bills in the market
before the end of 2020.
The U.S. Treasury will be buying every security and loan in sight while the Fed will be the banker – financing the whole scheme.
So essentially this is a Fed/Treasury merger. A behemoth dispensing loads of helicopter money.
And the winner is BlackRock—the biggest money manager on the planet,
with tentacles everywhere, managing the assets of over 170 pension
funds, banks, foundations, insurance companies, in fact a great deal of
the money in private equity and hedge funds. BlackRock — promising to be
fully “transparent” — will buy these securities and manage those dodgy SPVs on behalf of the Treasury.
BlackRock, founded in 1988 by Larry Fink, may not be as big as
Vanguard, but it’s the top investor in Goldman Sachs, along with
Vanguard and State Street, and with $6.5 trillion in assets, bigger than
Goldman Sachs, JP Morgan and Deutsche Bank combined.
Now, BlackRock is the new operating system (OS) of the Fed and the Treasury. The world’s biggest shadow bank – and no, it’s not Chinese.
Compared to this high-stakes game, mini-scandals such as the one around Georgia Senator Kelly Loffler are
peanuts. Loffler allegedly profited from inside information on Covid-19
by the CDC to make a stock market killing. Loffler is married to
Jeffrey Sprecher – who happens to be the chairman of the NYSE, installed
by Goldman Sachs.
While corporate media followed this story like headless chickens,
post-Covid-19 plans, in Pentagon parlance, “move forward” by stealth.
The price? A meager $1,200 check per person for a month. Anyone knows
that, based on median salary income, a typical American family would
need $12,000 to survive for two months. Treasury Secretary Steven
Mnuchin, in an act of supreme effrontry, allows them a mere 10 percent
of that. So American taxpayers will be left with a tsunami of debt while
selected Wall Street players grab the whole loot, part of an
unparalleled transfer of wealth upwards, complete with bankruptcies en
masse of small and medium businesses.
Fink’s letter to his shareholders almost gives the game away: “I believe we are on the edge of a fundamental reshaping of finance.”
And right on cue, he forecasted that, “in the near future – and
sooner than most anticipate – there will be a significant reallocation
of capital.”
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