Saudis spurn chance to help IMF

Japan confirms that the G20’s only aim is to stabilise, not to cure, the financial system.

QUOTE FROM ABOVE
Japan argues that it is important to make more funds available to the IMF in case the effects of the financial crisis continue to spread.
UNQUOTE

There is no way that the G20 will take whatever further actions are necessary to cure the patient, that is, to cure the financial system.

The G20’s only aim is to stabilise the patient within her straitjacket of worthless digital liquidity.

G20 declaration
http://www.whitehouse.gov/news/releases/2008/11/20081115-1.html
SNIP
7. Against this background of deteriorating economic conditions worldwide, we agreed that […] we will:
Continue our vigorous efforts and take whatever further actions are necessary to stabilize the financial system.

see my other comments under
World leaders agree action plan for reform, global growth
WASHINGTON, Nov 16, 2008 (AFP)
By Adam Plowright
http://www.zawya.com/story.cfm/sidANA20081116T015907ZQKQ42/World%20Leaders%20Agree%20Action%20Plan%20For%20Reform%2C%20Growth

Dubai is in talks with the United Arab Emirates government over a loan facility that would make state funds available to companies as international sources of capital dry up.
( Dubai in UAE talks over state funds
Financial Times, Nov 18 2008 18:15
http://www.ft.com/cms/s/498e4468-b59b-11dd-ab71-0000779fd18c,s01=1.html

Ivo:
What does that sentence mean?

The FT article concludes:
Borse Dubai said the rising cost of borrowing should be cancelled out by falling interest rates. “Even if Borse Dubai pays plus 300 basis points on the loan, the cost will be about the same,” said an official involved in the refinancing discussions.

Ivo:
Can somebody explain to me how interest rates can fall if there is
only one lender
and an oversupply of would-be borrowers?

How can interest rates fall if there is only the lender of one and only resort,
who used to be called the lender of last resort,
to meet the heavy demand of would-be borrowers?

“Abu Said Al Khudri reported Allah’s messenger as saying: “gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt for salt. (When a transaction is) like for like, payment being made on the spot, then, if anyone gives more or asks more, he has dealt in riba, the receiver and the giver being equally guilty.”
Sahih Muslim

This Hadith of Prophet Muhammed establishes two things:
ONE ‘money’ in Islam is either precious metals such as gold and silver, or commodities such as wheat, barley, dates and salt.
TWO when gold, silver, wheat, barley, dates and salt were used as money, their value was ‘inside’ and not outside’ the money. Hence, it is established that ‘money’ in Islam must possess intrinsic value.
(Imran N. Hosein, “Explaining the Disappearance of Money with Intrinsic Value”, paper delivered at the International Conference on the Gold Dinar Economy, held in Kuala Lumpur, July 24-25, 2007)

Gulf Single Currency
Single currency 'will make Gulf more stronger'
Wednesday, 19th November 2008
http://www.gulf-daily-news.com/Story.asp?Article=235099&Sn=BUSI&IssueID=31244
SNIP
MANAMA: The GCC needs to accelerate its move towards a single currency which would make the whole region much stronger.
That was the message to the seminar from Standard Chartered Bank economist Marios Maratheftis.
Once the states put in place a central bank and the necessary institutions a common currency could be up and running in a matter of weeks, he said.
"People talk about the problem of convergence before setting up a single currency but that is not an issue here," he said.
"With the exception of Kuwait all the GCC currencies are pegged to the dollar so you have in effect a single currency in place.

On a positive note, Mr Maratheftis said that in the wake of the crisis the GCC should push ahead faster in adopting a single currency which, if backed by a strong regional government bond market could pave the way for a free floating currency that would be attractive to central banks around the world as a hedge against fluctuations in the oil price.
( Cash is king in turmoil
By ARTHUR MACDONALD
19th November 2008
http://www.gulf-daily-news.com/Story.asp?Article=235102&Sn=BUSI&IssueID=31244

Dubai in UAE talks over state funds
Financial Times, Nov 18 2008 18:15
http://www.zawya.com/Story.cfm/sid20081118_4843_429/Dubai%20In%20UAE%20Talks%20Over%20State%20Funds

I'm just a dreamer,
but maybe, next week, Friday 28 November, at a United Nations Summit in Doha on the crisis,
the whole planet will become as bright as the Saudis.

Maybe, the planet will start examining the causes of the crisis. Those causes are worthless digital liquidity and fractional-reserve banking. The latter allows banks to multiply the former at will. (How can there then be a credit crunch? Good question!)

Maybe, the planet will stop maintaining the corrupt dollar-regime at all cost.

Maybe, the planet will stop caricaturing everything (oil, gas, gold, euro, etc.) which does not suit the said regime.

Qatar confirms UN summit on financial crisis
http://www.zawya.com/Story.cfm/sidANA20081118T183434ZQVL70/Qatar%20confirms%20UN%20summit%20on%20financial%20crisis
SNIP
DOHA, Nov 18, 2008 (AFP) - Qatar confirmed on Tuesday that it will host later this month a summit on the global financial crisis at the request of UN chief Ban Ki-moon.
Qatar's Prime Minister Sheikh Hamad bin Jassem bin Jabr al-Thani made the announcement at a joint news conference with his Polish counterpart David Tusk.
On Monday the United Nations said that Ban has summoned more than 20 heads of state and governments to Doha on November 28 to discuss the global financial crisis.

Bernanke Says Federal Reserve Won't Reveal Details on Loans http://www.bloomberg.com/apps/news?pid=20601087&sid=aS1eWoJj0sKc&refer=home
SNIP
Nov. 18 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said the central bank won't disclose details of the $2 trillion in emergency loans of taxpayer funds because doing so would stigmatize banks needing the money.

USA automakers’ bail-out will lead to civil unrest in the USA.

Please allow us to throw the dollar-regime out
so that we can develop our own stability.

FreeGold versus IMF

http://bphouse.com/honest_money/freegold-versus-imf/
SNIP

When human intelligence is confronted with the highest truths, it is in the same situation as the bat who is dazzled by the light of the sun, writes Aristotle in lines 993b9-11 of his Metaphysics.
For Thomas Aquinas, in the Preface to his “Commentary on the Book of Causes” (Super Librum De Causis Expositio), this bat becomes an owl whose eye cannot perceive the sunlight well because of the sun’s intense brightness.

Here’s the consolidation of the papers which I submitted, but did not present, to the GCC Currency Forum 2008, held in Dubai on 15 June 2008

Today, 10:41 AM

AUTHOR: azuro

SUBJECT : Saudis - IMF

http://www.goldforum.com/forum/showthread.php?p=152#post152

QUOTE

Saudi Arabia at the weekend resisted international pressure to copy Japan's example and give the International Monetary Fund additional funds to bail out ailing economies. It has opted instead to focus on domestic expenditures amid complaints from Saudi commentators that the west was attempting to "steal" the oil exporter's wealth.

Is this an act of resistance against dollar dictatorship by a former $-loyalist also fed up with the constant dollar bullying !?

I do think so .

UNQUOTE

A Single Currency for the GCC

13 September 2008

http://blogs.zawya.com/goldiswealth/080914122511/

SNIP
If the GCC marks its Gold reserves to market, whereas the dollar, to which the GCC single currency would remain pegged (in a basket), marks them to the model of $42 or so an ounce, we would have a contradiction in the GCC single-currency system. Does that explain why the launch of the GCC single currency should be postponed until … ?

When you think about it, the [European Central Bank] would like nothing better than for the dollar to get stronger as it inflates. If the USA can keep the game going just a little longer while the GCC can get on board of FreeGold and while everybody also gets what he wants, that’s good for everybody, right?

Dubai refutes being in talks with federal gov. to get loans - 19Nov08 (0:35)
http://www.zawya.com/video/default.cfm/sidVID20081119144057
Dubai government confirms that companies that are in need for financial support are few.Our money

Dubai denies talks with federal gov't over funding
by Dylan Bowman and Reuters on Wednesday, 19 November 2008
http://www.arabianbusiness.com/538832-dubai-in-talks-with-federal-govt-over-funding
SNIP{
UNDER CONSIDERATION: Dubai has denied it is in talks with the federal government to set up a fund for state-owned companies. (Getty Images)
Dubai is not in talks with the UAE federal government to create a state-funded loan facility to help firms facing tight borrowing conditions, a government official said on Wednesday.

The dollar regime, as represented by the Financial Times of London, was trying to build perceptions of doom and gloom for its challengers who, as the FT is afraid to mention, are investing at home and who are thereby developing their own stability independently, and outside of the action radius, of the chaos of the dollar regime.

The regime’s attempts have failed.

So will its attempts to keep a tight (monetary and thus military) rein over this planet.

Dubai does not want to assess the causes of the crisis.

Dubai only accepts examining the impact of the crisis.

Dubai sets up panel to assess crisis impact
By Gaurav Ghose, Financial Features Editor
Published: November 20, 2008, 00:01]
http://www.gulfnews.com/business/Markets/10261173.html
SNIP
Dubai: The Dubai government has set up a new committee to assess the impact of the global financial crisis on the emirate’s economy, a senior official said on Wednesday.

“The purpose of the high-level committee is to look at the impact of the global financial crisis on Dubai and what can be done in sectors, including real estate and banking,” said Nasser Al Shaikh, Director-General of Dubai Department of Finance, at a luncheon organised by the UAE Bankers Forum.

“We cannot be in a state of denial about the challenges… [The committee] will make recommendations to the Ruler on the way forward for critical areas that have to be tackled to withstand future challenges,” said Al Shaikh, who is also a member of the committee.
UNSNIP

Ivo:
Note how Dubai says that it cannot be in a state of denial about the challenges.
Maybe someone will have the bright idea to include the examination of the causes of the crisis in(-to) the challenges.

The dollar regime does not accept any blame

‘Challenges yes, but no regrets'
By Gaurav Ghose, Financial Features Editor
Published: November 20, 2008, 00:01
http://www.gulfnews.com/business/Economy/10261098.html
SNIPS
"You cannot blame the banks as they were caught off guard," Al Shaikh said, adding it would take time for the situation to normalise.
+
He also denied a Financial Times report of ongoing talks between Dubai and the UAE federal government to crate a state-funded loan facility to help firms facing difficulty in accessing capital amid tightening global credit markets.
UNSNIP

Ivo:
So how the heck do you expect them to examine the causes of the crisis?

To repeat:
Worthless digital liquidity and fractional-reserve banking are fraudulent.

It is surprising to see Dubai banks allege that they were caught off guard by riba-inspired practices.

Moreover, those banks have no regrets about that. I will refrain from commenting on this last point.

Ivo Cerckel

ECB releases new details of money market dollar lending
Web posted at: 11/20/2008 2:20:16
AFP
http://www.thepeninsulaqatar.com/Display_news.asp?section=Business_News&subsection=market+news&month=November2008&file=Business_News2008112022016.xml
SNIPS
The ECB obtains dollars from the US Federal Reserve through what is known as a reciprocal currency arrangement, or swap, and lends them to eurozone banks which have operations and/or financing needs in the US currency.
+
This week, only six banks offered euro cash for the dollars, compared with 52 that put up collateral against the loans, which along with the amounts involved indicated a clear preference for that option.

Japan economists call for 'Obama bonds'
By Kosuke Takahashi
Nov 19, 2008
http://www.atimes.com/atimes/Japan/JK19Dh01.html
SNIPS
TOKYO - Japanese economists, increasingly concerned that the United States might seek to pay its enormous and growing debt obligations in a weakened US dollar, are looking to the possibility of US Treasuries being issued in yen.
+
“The US will be forced to issue foreign currency-denominated US Treasures in its hour of need," said Mizuno. "The US cannot finance its deficit by itself. The US financial system cannot survive without foreign investors. We will see 'Obama Bonds' in the future."

The Speech We Should Have Heard at the G-20
By Gabor Steingart
11/18/2008
http://www.spiegel.de/international/germany/0,1518,591104,00.html
SNIP
At the financial summit in Washington, the international community was unduly respectful of the United States, neglecting to probe more deeply into the reasons for the crisis. Only one attendee was unruly -- German Finance Minister Peer Steinbrück. Here's the message he didn't deliver to Bush.

Reflation Challenge & Gold
By: Jim Willie CB, GoldenJackass.com

Posted Wednesday, 19 November 2008http://news.goldseek.com/GoldenJackass/1227131103.php

SNIP
When asked about economic prospects, a standard answer lately of mine has been to observe important signals not of recession but of potential disintegration.

Ivo:
After the disintegration, the Khaleej dinar can be introduced

Our friends from the pink paper are confirming that Dubai will only assess the impact from the crisis.

The causes of the crisis remain taboo.

But more surprisingly, they continue to allege that the Dubai government is in talks with the UAE federal authorities over a potential facility that could make funds available to companies that need help as other sources of financing dry up.

The Financial Times is even reporting that the Dubai government will stand behind companies that need help in the refinancing of their debt.

Dubai pledges steps to counter downturn
By Simeon Kerr in Dubai
Published: November 19 2008 19:32 | Last updated: November 19 2008 19:32
http://www.ft.com/cms/s/0/b736b3e0-b665-11dd-89dd-0000779fd18c.html
SNIP
As the clouds of the financial crisis gather over Dubai, a government official said on Wednesday that the emirate would take strong measures to deal with the impact of the economic downturn.
Nasser al-Shaikh, director-general of the department of finance, said the government was not in denial about the challenges it faced and had set up a committee during the past few weeks to explore ways of steering its way through the present crisis.
The Financial Times this week reported that the Dubai government was in talks with the United Arab Emirates federal authorities over a potential facility that could make funds available to companies that need help as other sources of financing dry up.
“We are making various changes to the whole business model,” Mr Shaikh told reporters at a bankers’ meeting in Dubai. “We are revisiting sovereign and corporate debt, revenues and ways of doing things. We want Dubai to be the first place to rebound when the recovery starts.”
He said the Dubai government would stand behind companies that needed help in the refinancing of their debt.

Emirates Business 24/7 confirms that the Dubai government will continue to promote riba.

Dubai sets up financial panel
Mohamad Al Kady on Thursday, November 20, 2008
http://www.business24-7.ae/Articles/2008/11/Pages/11202008_257385463fd94edea05fffd876135473.aspx
SNIP
However, [Nasser Al Shaikh, Director-General of the Dubai Department of Finance] said Dubai's government would be ready to support any local company that may need help to refinance its debt.

I said 13 hours ago in “The dollar-regime was trying”:
The dollar regime, as represented by the Financial Times of London, was trying to build perceptions of doom and gloom for its challengers who, as the FT is afraid to mention, are investing at home and who are thereby developing their own stability independently, and outside of the action radius, of the chaos of the dollar regime.

The Financial Times writes however:
Saudi Arabia at the weekend resisted international pressure to copy Japan's example and give the International Monetary Fund additional funds to bail out ailing economies. It has opted instead to focus on domestic expenditures amid complaints from Saudi commentators that the west was attempting to "steal" the oil exporter's wealth.

I must thus humbly apologise to the Financial Times for what I have written. I am hereby doing that.

The final title of the FT article is:

Saudis spurn chance to help IMF by focusing on domestic woes
http://www.ft.com/cms/s/0/39d1b7e8-b448-11dd-8e35-0000779fd18c.html

“by” does not mean “in order to” I think.
So, Saudi Arabia is just ignoring the IMF.

Reminds me of the bumper sticker “I’m not deaf. I’m just ignoring you.”

Again, my apologies to the Financial Times.

I am afraid next week’s Doha United Nations conference will only address measures to contain the consequences of the crisis.

I am afraid the conference will not in any way try to prevent future crises from occurring.

I am afraid the conference will not in any way address the causes of the crisis.

DEVELOPMENT: U.N. Looks to Doha Summit for Answers
By Thalif Deen
http://ipsnews.net/news.asp?idnews=44778
SNIP
UNITED NATIONS, Nov 19 (IPS) - As the spreading global financial crisis threatens to cripple banks, stock markets and manufacturing industries in the developing world, the United Nations is now focusing on the outcome of a major international conference on Financing for Development (FfD) scheduled to take place in Doha next week.
+
[U.N. Under-Secretary-General for Economic and Social Affairs Sha Zukang] said the FfD conference will provide "an early opportunity to send a clear signal of the urgency of considering these matters while ensuring counter-cyclical and other measures to contain the consequences of the ongoing financial turmoil."

Yes,
the sentence before that one is:
Zukang said the current financial crisis throws a spotlight on the international community's failure to adequately address systemic issues.

Ivo:
Yes,
systemic, that would mean that the causes will be addressed.

But
why does the sentence I quoted in my previous reaction then limit the objective of the summit to the containment of the consequences of the crisis?

When will those causes finally be addressed?

At the end of day? After the Greater Depression?

Under no circumstance, will you examine the causes of the crisis.

In any circumstance, you will limit your investigation to examining how you THINK you can overcome the crisis.

The debate next week in Doha will be strictly limited to the manner in which we ASSUME we can overcome the crisis.

QUOTE
[H E Sheikh Hamad bin Jassem bin Jabor Al Thani, Prime Minister and Foreign Minister said]
that international cooperation was needed to help overcome the crisis.

(Qatar welcomes UN proposal for debate on crisis
The Peninsula
20 November 2008
http://www.zawya.com/story.cfm/sidZAWYA20081120033016/Qatar%20welcomes%20UN%20proposal%20for%20debate%20on%20crisis

The art of economics consists in looking
not merely at the immediate
but at the longer effects of any act or policy;

it consists in tracing the consequences of that policy
not merely for one group
but for all groups.

(Henry Hazlitt, 1946
http://jim.com/econ/chap01p1.html )

Gulf States must pay for USA automakers?

US seeks 300 billion dlrs from Gulf states: report
AFP http://www.zawya.com/Story.cfm/sidANA20081120T070709ZRBW53/US%20Seeks%20%24300%20Billion%20From%20Gulf%20States
SNIPS
KUWAIT CITY, Nov 20, 2008 (AFP) - The United States has asked four oil-rich Gulf states for close to 300 billion dollars to help it curb the global financial meltdown, Kuwait's daily Al-Seyassah reported Thursday.
+
The daily said the United States plans to use the funds to help the ailing automobile industry, banks and other companies suffering from the global financial turmoil.

I have a four-pronged comment. First, Japan is generous to offer to give the IMF $100 billion dollars. But who will be the final recipients of the money after it reaches the IMF? Will it go to inject more money in AIG, Fannie and Freddie? Or will it go to bail out GM, Ford and the likes? The developing countries have so far been affected less than the developed countries and they may not receive much help from the proposed IMF money. Second, will the United States which is primarily responsible for the crisis match Japan’s offer? British Prime Minister Brown forgot to stop in German and France on his way to the Gulf to ask for donations to the IMF. Nicolas Sarkozy knows better. Third, the oil petrodollars are in fact a monetary exchange for oil reserves which are a depletable resource found in the desert. Japan’s export money is a renewable resource and Japan is well developed. Fourth, the Gulf region and the Middle East has been affected badly and their governments are asked to fix their own house first.

Having said all that, I will be remiss if I did not say that the oil-exporting countries have a stake in the health of the world economy. A healthy world economy means more oil exports and higher oil prices. But the current problem is of such a magnitude that oil money can not fix it. OPEC countries have already lost $700 billion because of lower demand and lower prices. Gulf countries have also suffered huge losses for investing in Europe and the United States. They have paid their dues. They should now use their money to fix their own broken doors before the ceiling will fall on them.